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Wednesday, 17 June 2009
Page: 6472

Mr McCLELLAND (Attorney-General) (6:35 PM) —Access to justice is an important issue and a priority for the government. In the last two years, as a result of one-off funding, we have been able to put additional money—I think in the order of $47 million—into the system for community legal centres and legal aid commissions. I would be the first to say I would like to do better than that. I would also be the first to say that I would like to be able to do that on a more sustainable basis. We are looking at options with the state governments as to what we can do to enhance that. The reality is that all the research suggests that resources put in to assist people early in the piece can significantly reduce the costs subsequently incurred not only by the individuals but by the community. Part of that funding goes into a number of things—in particular, domestic violence and the areas covered by domestic violence but also areas where people are likely to suffer prejudice from the financial crisis. Hence, financial counselling has been regarded as very important.

In the area of bankruptcy, the reality in these times is that there has been an increase in the number of bankruptcies. We have increased funding by $14.3 million over two years to the Insolvency and Trustee Service Australia not only to enforce and administer bankrupt estates but also to provide assistance and advice. Generally, ITSA provides significant services. It is also obviously the case—from media reports and from the fact that we have just issued a discussion paper on potential reforms in the area of bankruptcy—that they inevitably will have some controversy, depending on the particular interest in the community represented. Essentially, the thrust of the reforms is intended to encourage people to obtain advice early if they appear to be insolvent and, where appropriate, at an early stage to enter into debtor agreements. The evidence suggests that creditors of those persons who have entered into debtor agreements in those circumstances recover in the order of 72c in the dollar. From bankruptcy they recover in the order of 6.2 per cent. I think those are the figures. If we can achieve that outcome at the same time as impose obligations on people to be frank—and, indeed, to consider penalties if people are not genuine in the information they produce—we may achieve some balance in the system. Clearly, there is some work to be done, but it is an important debate to be had.

I will go to the issue of the family law restructure. Again, the government proposes to act on the recommendations of Des Semple, who was an expert retained to advise the government on what was becoming quite a dysfunctional situation in the operation of the Family Court and the Federal Magistrates Court in particular. There were media reports—and, indeed, there was some substance to some of the reports—of quite trivial issues of disputation. The thrust of the government’s measures is obviously to save resources but to put resources back into the system—for instance, to use the savings to fund additional counsellors—and also to ensure a more effective allocation of resources between the two courts. For instance, there is disproportionate use of family counsellors in the Federal Court and less than adequate use of family counsellors at the doorstep of the court, which by and large tends to be the Federal Magistrates Court.

There are also inbuilt inefficiencies. Judges, because the matters are more complex, tend to set aside a number of days for hearings yet—as we all know—with lawyers they can resolve, making it easier for judges to use up those vacant days by facilitating a transfer of matters from magistrates to judges. We believe that will enhance the capacity of the courts—that is, the Family Court and the Federal Magistrates Court—to deal with their collective workload in the interests of litigants and taxpayers. We think it is a very effective initiative. In summary, Des Semple said, ‘To do nothing is no option.’ Something needs to be done and we believe the recommendations are sound.