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Monday, 23 November 2009
Page: 8621

Senator SHERRY (Assistant Treasurer) (9:07 PM) —I table revised explanatory memoranda relating to the Crimes Legislation Amendment (Serious and Organised Crime) Bill 2009 and the Fair Work Amendment (State Referrals and Other Measures) Bill 2009 and move:

That these bills be now read a second time.

I seek leave to have the second reading speeches incorporated in Hansard.

Leave granted.

The speeches read as follows—

Appropriation (Water Entitlements and Home Insulation) Bill 2009-2010

The Appropriation (Water Entitlements and Home Insulation) Bill 2009-2010 provides urgent funding to cover rebate payments made under the Home Insulation Program and departmental costs associated with the acceleration of the water buy backs within the Murray-Darling Basin system that are addressed in a further Bill to be introduced shortly.

The measures provided for in this Bill allow administered funding of $695.8 million for the Home Insulation Program to be brought forward (from 2010-11) and departmental funds of $4.9 million to be brought forward ($4.4 million from 2013-14 and $0.5 million from 2014-15) from the Water for the Future - Restoring the Balance in the Murray-Darling Basin program.

The $695.8 million for the Home Insulation Program is part of the $985.8 million bring forward of funding included in the Mid-Year Economic and Fiscal Outlook 2009-10. The remaining $290 million is required less urgently and will be included in the 2009-10 Additional Estimates Appropriation Bill (No.3).

The Home Insulation Program has seen unprecedented demand from householders with over half a million homes being insulated to date. The uptake level has exceeded initial expectations for the program.

The Bill requires immediate passage as the administered appropriations provided to the Department of the Environment, Water, Heritage and the Arts for 2009-10 are close to being exhausted. Based on the current take-up rate under the Home Insulation Program, the 2009-10 appropriation will be exhausted by late December 2009.

The current uptake rate for the Program is another positive confirmation of the success of one of the Government’s Stimulus Package measures in supporting jobs in not only the manufacturing industry but also in installer job creation and associated logistics. The rate of expenditure is in keeping with providing rapid job support and economic stimulus. Improved energy efficiency for Australian households is also being delivered.

The departmental costs within this Bill are for the Department of the Environment, Water, Heritage and the Arts and will provide adequate resourcing to efficiently implement the Government’s water purchase program in 2009--10.

Appropriation (Water Entitlements) Bill 2009-2010

The Appropriation (Water Entitlements) Bill 2009-2010 requests urgent funding for the Department of the Environment, Water, Heritage and the Arts to accelerate water buy backs within the Murray-Darling Basin system.

The measures provided for in the Bill will enable $650 million for water buy backs to be brought forward from later years of the Restoring the Balance in the Murray-Darling Basin program under Water for the Future.

The objective of the Restoring the Balance in the Murray-Darling Basin Program is to purchase water entitlements to restore the environmental health of the Murray-Darling Basin system, and to smooth the transition to the lower sustainable diversion limits anticipated in the new Basin Plan. To date, the Restoring the Balance in the Murray-Darling Basin Program has secured the purchase of more than 600 gigalitres of water entitlements.

The funding bring forward in this Bill will enable a further acceleration of environmental water purchasing and provide for new water purchase initiatives in 2009-10.

The total appropriation sought in this bill is $650 million, comprising:

  • $320 million, which the Minister for Climate Change and Water announced on 3 November 2009, and which was included in the Mid-Year Economic and Fiscal Outlook (MYEFO) 2009-10 - brought forward from 2010-11 ($220 million) and 2011-12 ($100 million); and
  • a further $330 million, brought forward from 2010-11 ($100 million), 2011-12 ($100 million) and 2013-14 ($130 million), to provide for additional water buy backs in 2009-10, and which has been decided since MYEFO 2009-10.

The Bill requires immediate passage. The administered appropriations currently provided to the Department of the Environment, Water, Heritage and the Arts are not sufficient to cover the cost of trades that are likely to be offered to the Government under the water purchase program in 2009-10. With the additional appropriation, vendors will receive timely settlement of their water trades under the Restoring the Balance in the Murray-Darling Basin program.

Departmental costs of $4.9 million will also be provided to the Department of the Environment, Water, Heritage and the Arts to support the accelerated water buy backs. The departmental funding is outlined in the Appropriation (Water Entitlements and Home Insulation) Bill 2009-2010.

Crimes Legislation Amendment (Serious and Organised Crime) Bill 2009

General introduction

Organised crime affects many areas of social and economic activity, inflicting substantial harm on the community, business and government.

It has been estimated to cost the Australian economy at least $15 billion each year. 

In his Inaugural National Security Statement, the Prime Minister, the Hon Kevin Rudd MP, gave an assurance that the Government would act to address the threat posed by organised criminal activity.  The Crimes Legislation Amendment (Serious and Organised Crime) Bill delivers on that assurance.

The security of Australia is the Government’s highest priority, and maintaining that security requires decisive action to target serious and organised crime.

It is important that we put strong laws in place to combat organised crime. 

We need to target the profits of crime and remove the incentive for criminals to engage in organised criminal activity. 

We also need to empower our law enforcement agencies to defeat the sophisticated methods used by those involved in organised criminal activity to avoid detection.  Appropriate access to covert investigative tools, such as controlled operations, assumed identities and telecommunications interception, will assist police to investigate and disrupt criminal activities.

It is also vital to ensure offences extend to people who commit crimes as part of a group.

In April 2009, the Standing Committee of Attorneys-General (SCAG) agreed to a set of resolutions for a national response to organised crime. 

This Bill implements the Commonwealth’s commitment as part of the national response to enhance its legislation to combat organised crime by:

1.   strengthening criminal asset confiscation and targeting unexplained wealth

2.   enhancing police powers to investigate organised crime by implementing model laws for controlled operations, assumed identities and witness identity protection

3.   addressing the joint commission of criminal offences, and

4.   facilitating greater access to telecommunications interception for criminal organisation offences.

1.   Strengthened criminal asset confiscation

The ability to trace, restrain and confiscate the benefits criminals derive from offences is a vital part of an effective justice system.

The Bill will implement a range of measures to extend and enhance the Commonwealth confiscation regime.  Several of these measures respond to recommendations in the review of the Proceeds of Crime Act 2002 made by Mr Tom Sherman AO, in 2006.

New unexplained wealth provisions will be a key addition to the Commonwealth criminal asset confiscation regime.

These provisions will target people who derive profit from crime and whose wealth exceeds the value of their lawful earnings.

In many cases, senior organised crime figures, who organise and derive profit from crime are not linked directly to the commission of the offence. They may seek to distance themselves from the offence to avoid prosecution or confiscation action.

Unlike existing confiscation orders, unexplained wealth orders will not require proof of a link to the commission of a specific offence.

However, there must still be a connection between the unexplained wealth and criminal offences within Commonwealth legislative power.

The Bill will also provide for freezing orders that will prevent a financial institution from processing withdrawals from a specified account for a period of up to three days.

Sometimes, there is only a very short window between law enforcement uncovering the illegitimate assets of a criminal group and those assets being transferred to avoid confiscation.

The new freezing orders will ensure offenders cannot frustrate restraining orders by using the time it takes to obtain a restraining order to dissipate funds.

Freezing orders will be strictly limited in duration and application and can only be sought where there are reasonable grounds to suspect an account contains the proceeds of an offence.  A person affected by a freezing order may also apply to have reasonable expenses excluded from the order.

The Bill will simplify arrangements for legal aid commissions to recover costs incurred by people who have assets restrained under the Proceeds of Crime Act 2002.

It has always been intended that legal aid commissions be reimbursed for the provision of legal assistance to persons whose assets have been restrained under that Act.

This is to ensure that all persons the subject of proceedings under the Act would be able to seek assistance from legal aid commissions without impacting adversely on other legal aid priorities.

The existing scheme, which requires legal aid commissions to recover legal costs directly from a person’s restrained assets,  has proven complex and at times, subject to delay.

Under the new scheme, legal aid commissions will be able to recover legal costs incurred by a person with restrained assets directly from the Confiscated Assets Account.

The Commonwealth will then recover the amount from the person who received the legal aid, up to the value of the restrained assets.

The Bill will also improve other aspects of the existing confiscation regime, including by ensuring information obtained under the regime can be disclosed to agencies with functions under the Act, which are generally law enforcement functions.  The information may be provided if it will assist in the prevention, investigation or prosecution of criminal conduct.

2.   Cross-border investigative powers

Organised crime does not respect borders, and it is vital that police are able to work across jurisdictions with the same ease. 

The 2002 Leaders Summit on Terrorism and Multi-Jurisdictional Crime agreed that there should be a national set of laws for cross-border investigative powers. 

Model laws for controlled operations, assumed identities, surveillance devices, and witness identity protection were then endorsed by the Standing Committee of Attorneys-General in 2004.  

A key aspect of the model laws is that they provide for the mutual recognition of authorisations and warrants issued in other jurisdictions. 

This will enable more effective investigations across jurisdictions and reduce the risk of losing evidence.   The availability of consistent sets of powers across jurisdictions also facilitates closer cooperation between law enforcement agencies.

The Commonwealth implemented model laws for the use of surveillance devices in 2004.

This Bill implements the model laws for controlled operations, assumed identities and witness identity protection, replacing the existing regimes in the Crimes Act 1914

In doing so, some modifications have been necessary to reflect, for example, the unique role of the Commonwealth for national security and the investigation of crimes with a foreign aspect.

Controlled operations

In undercover operations, law enforcement officers may be authorised to do certain things that would otherwise be illegal in order to obtain evidence of a serious offence. 

For example, a shipment of drugs might be allowed to pass through border control in order to follow the trail to the buyers or distributors. 

In these kinds of operations - called controlled operations - the authorised person is protected from criminal responsibility and indemnified against civil liability for their actions. 

The admissibility of the evidence that is obtained is also preserved.

There are appropriate limits on this; controlled operations do not authorise conduct likely to cause death or serious injury, or involve the commission of a sexual offence. 

There are also strong accountability mechanisms in place to ensure that the exercise of these powers is publicly accountable.

The Bill also responds to concerns arising from the High Court’s decision in Gedeon v Commissioner of the New South Wales Crime Commission.

Following Gedeon, there is a real risk that there is insufficient protection for persons authorised under State or Territory controlled operations laws who commit Commonwealth offences. 

The new controlled operations regime will recognise corresponding State and Territory laws - removing the need to seek a separate Commonwealth authorisation. 

Further, the Bill will provide for retrospective protection for evidence obtained from, and persons who participated in, validly authorised State or Territory controlled operations. 

Assumed identities

The use of assumed - or false - identities is an important law enforcement tool allowing operatives to protect their real identity and infiltrate criminal groups.

Authorised persons can make requests to government and non-government agencies to obtain evidence of an assumed identity. 

For example, a fictitious driver’s licence or credit card. 

Persons using assumed identities would be protected from criminal liability arising only from their authorised use of that identity. 

For example, a person using a fake driver’s licence would not be prosecuted for having a fake ID, but could still be prosecuted for dangerous driving. 

Further, a person who is authorised to acquire a fake driver’s licence, but is not qualified to drive, will not be authorised to drive a vehicle. 

The new assumed identities regime will recognise things done in relation to an assumed identity authorised under a corresponding State or Territory law.

The safeguards and accountability measures for the new assumed identities regime in some cases exceed the protections provided in the model laws. 

For example, a person who has an assumed identity will commit an offence if he or she fails to return evidence of an assumed identity when requested to do so. 

This will act as a deterrent to those who may seek to use their false identity after the authorisation has ceased.

Witness identity protection

The Bill also puts in place a comprehensive scheme that protects the safety of witnesses who are undercover operatives and the integrity of operations in a transparent and accountable way.  This will ensure that participants in controlled operations and authorised users of assumed identities are not exposed in court proceedings.

Undercover operatives may be required to give evidence in legal proceedings.

The witness identity protection regime will allow an operative to give evidence using a pseudonym. 

For example, the operative could appear in court under his or her assumed identity.

In some cases, it may be necessary to protect the operative’s true identity to ensure their safety or to avoid prejudicing current or future investigations or security activity.  

While this is clearly in the public interest, this must be balanced against the right of an accused person to a fair trial.  

The witness is not anonymous or secret - defence counsel can still cross examine them and test their credibility.

The operative is still bound to tell the truth.

The operative will need to declare matters relevant to their credibility, for example, any prior convictions or allegations of professional misconduct.

This information is made available to defence counsel as part of the witness identity protection certificate. 

The court may allow defence counsel to ask questions which may reveal the witness’ true identity where there are compelling circumstances and it is in the interests of justice to do so.

The court will also be able to require the real identity of the witness to be disclosed to it. 

3.   Joint commission

The Bill introduces a new joint commission provision which is targeted at offenders who commit crimes in organised groups.  This provision builds upon the common law principle of ‘joint criminal enterprise.’

If a group of two or more offenders agree to commit an offence together, the effect of joint commission is that responsibility for criminal activity engaged in under the agreement by one member of the group is extended to all other members of the group. 

Joint commission targets members of organised groups who divide criminal activity between them.  If, for example, three offenders agree to import heroin into Australia and two of the offenders each bring in 750grams of heroin, all three offenders can be charged with importing a commercial quantity.

4.   Telecommunications interception

The ability for law enforcement to intercept telecommunications is integral to the fight against organised crime. 

Telecommunications interception warrants are already available for the investigation of serious offences of a certain type or which carry a penalty of more than seven years imprisonment.

The penalties for organised crime association and facilitation offences are generally lower and therefore telecommunications interception cannot currently be used to investigate them.

However, in order to fight organised crime we must be able to target those who support the activities of criminal groups.  

The Bill will make telecommunications interception available for the investigation of offences relating to an individual’s involvement in serious and organised crime.

This will be limited to the individual's involvement in criminal organisations committing offences that are punishable by at least three years imprisonment. 

The amendments will allow law enforcement agencies to access stored communications such as emails and text messages, as well as real-time interception of targets’ communications.

This limit recognises the invasive nature of telecommunications interception and seeks to balance the need for operational effectiveness. 

These amendments will ensure that law enforcement agencies are equipped with the necessary tools to effectively combat organised crime.


In conclusion, this Bill contains a range of measures to comprehensively target serious and organised crime through enhanced asset confiscation, the introduction of joint commission and improving the ability of law enforcement agencies to conduct investigations.

Together these measures represent a significant advance on the tools available in the fight against serious and organised crime.  They are an important part of this Government’s commitment to keeping Australia safe and secure.

I commend this Bill.

Fair Work Amendment (State Referrals and Other Measures) Bill 2009

The Rudd Labor Government promised in Forward with Fairness to abolish the Coalition Government’s unfair Work Choices industrial relations laws and create a simpler, balanced and modern workplace relations system.

We achieved this with the commencement of the Fair Work Act 2009 on 1 July this year.

We now mark the next stage in implementing our plan, with the introduction today of the Fair Work Amendment (State Referrals and Other Measures) Bill 2009.

Before I outline the key features of the Bill, it is important to recall the stages of the Government’s workplace relations reforms that have been implemented to date.

Legislation passed by the Parliament to date

The Workplace Relations Amendment (Transition to Forward with Fairness) Act 2008 was introduced into Parliament on 13 February 2008.

It abolished the making of new AWAs and introduced the No-Disadvantage Test to ensure workplace agreements could no longer disadvantage employees. That Act also started the process to create new modern awards, which when coupled with the National Employment Standards, will complete a fair and comprehensive safety net of conditions for employees.

Award modernisation will result in the creation of around 150 easy to find and apply modern awards with national application to replace more than 4,000 state and federal instruments.

The next step of the Government’s workplace relations reform process was the passage of the Fair Work Act 2009 which commenced on 1 July 2009 and established:

  • A comprehensive safety net of minimum wages and employment conditions that cannot be stripped away;
  • a new agreements framework, with bargaining in good faith at the enterprise level at its heart; and
  • A new industrial umpire to oversee the system, Fair Work Australia, and a new education and enforcement body, the Fair Work Ombudsman.

We proposed in Forward with Fairness that a uniform national system would be achieved either by State Governments referring powers for private sector workplace relations, or other forms of cooperation and harmonisation. Our vision is for a workplace relations system that is fairer, simpler and more flexible and promotes productivity and economic growth; and a system where businesses, large and small, are covered by one national law and system.

The Fair Work (State Referral and Consequential and Other Amendments) Act 2009 which I introduced to Parliament on 27 May this year was the first stage in implementing this national system.

That Act supported a renewal of Victoria’s referral of workplace relations powers from 1 July 2009 to provide continued certainty of coverage to the working people and employers of Victoria.

I indicated that the Act’s framework would be adapted in future Commonwealth legislation to accommodate anticipated further references of power from other States, while observing that the reference framework may require amendment to account for the views and needs of other States choosing to refer.

The benefits of a national workplace relations system for the private sector

The Bill I introduce today answers the many calls made by business over many years to end the overlap and duplication of state and federal workplace relations systems; to end the inefficiency, uncertainty and legal complexity for Australian businesses and employees.

For example, the Australian Chamber of Commerce and Industry has stated:

The level of complexity created by competing state and federal workplace relations systems is a decades-old problem which has been thrown into sharp relief by our contemporary market economy. Replication, overlap and confusion between state and federal workplace regulation has become increasingly unsustainable.

And the Australian Industry Group has also noted the complexity and wastefulness of multiple systems:

On top of this, all but one of the States continued to develop and enhance their own industrial systems. No matter how well many of these systems operate the fact remains that no employer wants to be faced with dealing with six different systems in order to expand its business throughout Australia. The intermeshing and clash of these systems has nourished generations of industrial lawyers.

In answer to these calls, the previous Government took the significant step of relying upon the corporations power of the Constitution to regulate for a national workplace relations system.

But for many Australian employers and employees, Work Choices only continued - and exacerbated - the problems of complexity, confusion, overlap and waste.

We committed in Forward with Fairness to work cooperatively with the state governments to create a uniform national workplace relations system for the private sector. And with today’s Bill, we demonstrate once more the Rudd Labor Government’s commitment to achieving important national reform through cooperative federalism.

This partnership approach is in stark contrast to the bullying tactics of the former Coalition Government. Their refusal to work with the States resulted not only in grossly unfair laws, but in an unwieldy system characterised by legal complexity and uncertainty of coverage.

In the absence of referrals of power from the states, the question of which system applies depends upon whether a business is a ‘constitutional corporation’ or not.

This means that corporations that derive revenue through donations (such as charities) or through government grants may not fall within the corporations power. The jurisdictional coverage of an employer can change at any particular point in time if its activities change.

For example, a charity raising money for medical research could open a second-hand goods shop to raise funds only to find it is now seen as ‘trading’ and that this leads to a change in its jurisdictional coverage.

The question of coverage also depends on the nature of the entity running the business. For example, a professional services firm (say an accounting or medical practice) might run as a partnership or sole trader and be in a state system. A very similar business down the street might be incorporated and therefore in the federal system and on a different award.

And there are many more examples of perverse outcomes, confusion and complexity.

There are thousands of employers and employees who are not trading corporations but who have been in the federal system for a long time, as a result of long-standing awards made in settlement of an inter-state industrial dispute. These awards were preserved on a transitional basis under Work Choices. In the absence of state referrals of power, employers and employees on these transitional awards would have fallen back to the state systems from March 2011.

For example, approximately 70% of the farm businesses covered by the Transitional Pastoral Award are unincorporated and without this Bill, these farmers and their employees would fall back into State systems. And the uncertainty they were facing under Work Choices was exacerbated by the fact that many farmers operate across state borders and would have had to commence to apply different state and federal workplace relations laws.

In support of farmers, the National Farmers Federation has been a vocal proponent of a uniform national workplace relations system, stating that “the overwhelming majority of farmers will be stranded [in the event that states do not refer their powers to the Commonwealth]” and that this would be “totally unacceptable”.

The uniform national workplace relations system for the private sector will resolve once and for all the confusion and complexity I have described.

Employers and employees will for the first time have the same laws, tribunals, minimum conditions, rights and entitlements as their counterparts doing the same work, regardless of whether they are within the same state or across a border; regardless of whether they are trading as a corporation, a sole trader or a partnership.

The new national system will make it far easier for businesses and employees to find the information they need. This will result in a permanent, intrinsic efficiency for businesses, especially for small businesses that do not have the benefit of specialised human resources staff.

With this Bill and associated state referrals, the Fair Work system will provide a single point of access for all private sector workplace relations services for Australia. There will be one website, one phone number, one tribunal and one inspectorate.

This means that governments and tax-payers will benefit too. Nationally, state governments spend upwards of $60 million of tax-payers’ money each year maintaining duplicate administrative functions and regulation. The new system will be far more efficient into the future.

Cooperative federalism and the benefits of State referrals

For all of these reasons, there is significant support among the states for the national system.

The Governments of South Australia and Tasmania have announced their intentions to follow the Victorian Government’s lead and make referrals of their private sector workplace relations powers. This is a significant vote of confidence in the new Fair Work laws.

Both State governments have introduced legislation into their respective parliaments to facilitate these referrals of power from 1 January 2010.

In leading these important reforms for their respective states, South Australian Minister for Industrial Relations, the Hon Paul Caica MP, and the Tasmanian Minister for Workplace Relations, the Hon Lisa Singh MP, have noted the broad support within their states to participate in a national workplace relations system and the significant benefits that will flow to employees and employers.

At this time, the Queensland Government has agreed in principle to refer powers to the Commonwealth, subject to resolution of related issues. I am confident that we can reach an agreement on these issues.

The New South Wales Government has not yet made a decision regarding its participation, but has engaged cooperatively with the Commonwealth to progress the national workplace relations system.

This leaves Western Australia as the only State to declare publicly that it will not to refer its powers. Unfortunately this decision puts Western Australia out of step with all other states and prevents Western Australian employers and employees from reaping the benefits of the national system.

I note that the Chamber of Commerce and Industry of Western Australia has publicly indicated support for a Western Australia referral, citing the obvious problems of complexity, uncertainty and duplication.

The Chamber joins many other business groups in supporting a national approach to workplace relations including harmonisation of occupational health safety laws, as essential reforms for the long-term productivity and efficiency of the national economy.

I urge the Western Australian Government to reconsider its decision.

Supporting state referrals

And this brings me to the Bill before us today.

To give effect to South Australia and Tasmania’s referrals, I introduce to the House the Fair Work Amendment (State Referral and Other Measures) Bill 2009.

Once enacted the Bill will give effect to the references of South Australia, Tasmania and any other State that refers its workplace relations matters to the Commonwealth on or before 1 January 2010. These references will enable the Commonwealth to:

  • extend the Fair Work Act in referring States to cover unincorporated employers and their employees, outworker entities and extend the operation of the general protections;
  • amend the Fair Work Act so that it applies uniformly in referring States; and
  • establish arrangements for the transition of referral employees and employers from State industrial or workplace relations systems to the new national system.

Initial reference

The Fair Work (State Referral and Consequential and Other Amendments) Act 2009 inserted Division 2A into Part 1-3 of the Fair Work Act with effect from 25 June 2009. Division 2A gave effect to Victoria’s workplace relations reference to the Commonwealth.

Schedule 1 to this Bill will insert Division 2B into Part 1-3 of the Fair Work Act to give effect to State references of workplace relations matters to the Commonwealth after 1 July 2009 but on or before 1 January 2010. The creation of Division 2B is necessary to accommodate differences in the timing of State references.

Like Division 2A, Division 2B will extend the meaning of national system employee and national system employer to encompass all employees and employers in referring States subject to exclusions relating to State public sector and local government employment.

Like Division 2A, Division 2B will also extend the definition of outworker entity, and extend the operation of the Fair Work Act’s general protections in referring States.

Amendment reference

The Bill will give effect to references enabling amendment of the Fair Work Act in respect of specified subject matters, to the extent that such amendments would otherwise be outside Commonwealth power. The Bill’s amendment reference provisions will enable the Fair Work Act to be amended to apply to all employers and employees in referring States uniformly. Consultation on amendments will be governed by a supporting inter-governmental agreement.

The subject matters of the amendment reference provisions correspond with the matters regulated by the Fair Work Act.

State public sector and local government

The Bill recognises that referring States can choose the extent to which matters relating to State public sector or local government employment are included or excluded from references.

Schedule 3 to the Bill amends the Fair Work Act to also enable States to exclude by declaration certain State public sector and local government employers over which the Commonwealth currently has jurisdiction (such as constitutional corporations) from the Fair Work Act.

Declarations would be able to be made by the State in relation to certain kinds of entities that are integral to State public administration or local government activities and which are therefore regarded as appropriately regulated in State systems. To be effective, a declaration would need to be endorsed by the Minister administering the Fair Work Act.

Termination of reference

The Bill will enable referring States to terminate their amendment references and remain in the national system in the following circumstances:

  • by proclamation of the State Governor with six months notice, if the amendment references of other referring States all terminate on the same day; or
  • by proclamation of the State Governor with three months notice, if the Governor considers that an amendment to the Fair Work Act is inconsistent with the fundamental workplace relations principles.

The fundamental workplace relations principles encompass requirements that the Fair Work Act should provide for, and continue to provide, for:

  • a strong, simple and enforceable safety net of minimum employment standards;
  • genuine rights and responsibilities to ensure fairness, choice and representation at work;
  • collective bargaining at the enterprise level with no provision for individual statutory agreements;
  • fair and effective remedies through an independent umpire;
  • protection from unfair dismissal; and
  • an independent tribunal system and an independent authority able to assist employers and employees within a national workplace relations system.

These principles prescribe fundamental values that the Commonwealth and relevant states have jointly declared to be essential features underpinning a fair and effective national workplace relations system.

Transitional arrangements for State referral employers and employees

The State references will support the transitional arrangements for State referral employers and employees set out in Schedule 2 to this Bill.

Schedule 2 to the Bill deals with instruments and processes on foot in State workplace or industrial relations systems and deals with federal awards and agreements made in reliance on the conciliation and arbitration power.

Schedule 2 to the Bill also makes amendments to the Fair Work Act and other Commonwealth Acts that are consequential on new referrals.

The transitional arrangements set out for incoming State instruments are, as far as possible, consistent with current arrangements for existing national system employers and employees.

The key features of the transitional arrangements are as follows:

  • State awards and State agreements will be preserved as federal instruments in the same terms as the State instrument. These will be known as Division 2B State awards and Division 2B State employment agreements.
  • Division 2B State awards and State employment agreements will operate on a ‘no-detriment’ basis with the National Employment Standards and the national minimum wage order.
  • A Division 2B State award (other than a Division 2B State enterprise award) will continue to apply as a federal instrument for a period of 12 months from referral commencement. After that time, a relevant modern award will cover the relevant employees and employers.
  • During the 12 month period, Fair Work Australia will be required to consider whether a modern award should be varied to provide appropriate transitional arrangements for incoming State employees and employers.
  • Further, FWA will be able to make remedial take-home pay orders where the take-home pay of one or more employees is reduced as a result of movement to the modern award.
  • A Division 2B State employment agreement will continue to operate as a federal instrument until replaced at any time by a new enterprise agreement under the Fair Work Act or terminated in accordance with the provisions of the Bill.
  • This Bill provides a model dispute resolution clause to be prescribed by the regulations which applies in relation to Division 2B State awards. Dispute resolution terms in State employment agreements will continue as terms of the Division 2B State employment agreements derived from them.
  • The new transfer of business rules in the Fair Work Act will apply to transfers that occur on or after the referral commencement. Division 2B State instruments will be transferable instruments for the purposes of the Fair Work Act transfer of business provisions.
  • Bargaining and industrial dispute processes under State systems will not be carried over into the new system. Bargaining participants will either have lodged a State agreement for approval by a State tribunal before the referral commencement or commence bargaining for a new enterprise agreement under the Fair Work Act. This will ensure an orderly transition to collective bargaining in the national system.
  • As a general rule, proceedings in relation to conduct that occurred before the referral commencement will remain subject to State laws and be dealt with in State systems.

Other amendments

Schedule 1 to the Bill also makes a number of amendments to Division 2A of Part 1-3 of the Fair Work Act for consistency with the arrangements set out in new Division 2B.

Schedule 3 to the Bill makes a number of amendments to the Fair Work Act to enable State Ministers to intervene in court proceedings and make submissions in relation to matters before Fair Work Australia.

Inter-governmental agreement

States participating in the national system will each be party to a multilateral inter-governmental agreement which outlines the principles of the national workplace relations system for the private sector and the roles and responsibilities of those participating States and Territories and the Commonwealth.

On 25 September 2009, workplace relations ministers from the Commonwealth, Victoria, South Australia, Tasmania, the Northern Territory and the Australian Capital Territory signed the multi-lateral agreement.

Education activities to accompany references

I advise the House that the Commonwealth will provide additional services to assist transferring employers and employees to understand the new system. Education activities will include telephone advice and visits to workplaces to be implemented in cooperation with referring states. There is scope for states to deliver services on behalf of the Commonwealth during the transition and constructive discussions on these arrangements are continuing.


The Government is well on the way to achieving a uniform national workplace relations system for the private sector.

The fundamental basis of the new system was established with the passage of the Fair Work Act: fairness for working people, flexibility for business and the promotion of productivity and economic growth for the future prosperity of our nation.

I commend the Bill.

Family Assistance Legislation Amendment (Participation Requirement) Bill 2009

This R4202bill introduces a new requirement for families receiving family tax benefit part A for children aged between 16 and 20.

To be eligible to receive family tax benefit part A, children between 16 and 20 must be studying full-time towards, or have completed, Year 12 or its equivalent.

Exemptions may be granted in special circumstances which will be detailed shortly.

This new participation requirement for FTB part A supports the Australian Government’s determination to increase the number of young people with a Year 12 or equivalent qualification.

The FTB changes complement the requirement recently introduced for youth allowance by the Social Security Amendment (Training Incentives) Act 2009.

The evidence makes it clear that young people who leave school early are less likely to make the transition into employment or further education than those who complete Year 12.

We also know that people of working age who don’t reach Year 12 or an equivalent level of education are more likely to be unemployed.

And if they are working, they are less likely to earn as much as people with a higher education.

In fact, for every year of extra education a person can expect to earn - on average - around $100 a week more.

And in times of economic downturn, early school leavers are at greater risk of disadvantage.

Looking back at the recession of the early 1990s, we find young people who didn’t complete Year 12 were around three times more likely to be unemployed or not undertaking further education than their peers who had completed Year 12.

This bill implements an important element of the agreement reached at the Council of Australian Governments meeting on 30 April 2009 - as part of the National Youth Participation Requirement and the Compact with Young Australians.

Broadly, the Compact with Young Australians will guarantee an education or training place for all young Australians under 25 who are not in work or education.

To support the Compact, the National Youth Participation Requirement will make participation in education, training or employment compulsory for all young people until they turn 17.

This bill introduces an activity test into eligibility requirements for an FTB child aged between 16 and 20 under the family assistance law.

To be eligible, a young person must be undertaking full time study in an approved course of education or study that will allow or assist them to complete Year 12 or an equivalent level of education.

The activity test will also be satisfied if a young person has completed their final year of secondary school or equivalent level of education, generally considered to be a Certificate level II qualification.

Exemptions may be granted if a young person’s circumstances meet one of three criteria.

The first is that there is no locally accessible approved course of education or study, and no such course available by distance education.

The second is that there is no place available in the course, or the young person is not qualified to undertake it, or lacks the capacity to study due to a physical, psychiatric, intellectual or learning disability.

An exemption may also be granted if there are special circumstances which make it unreasonable for the young person to undertake the course.

The Secretary of the Department of Families, Housing, Community Services and Indigenous Affairs will be able to establish guidelines concerning the special circumstances discretion, through a legislative instrument which will be subject to Parliamentary scrutiny.

There will also be some flexibility for a different study load, where this is appropriate to the young person’s circumstances.

The Secretary will be able to set a specific number of hours per week of study for a young person for the purposes of the new activity test.

The changes made by this bill complement existing eligibility rules for family tax benefit part A for dependants aged 21 to 24, and for family tax benefit part B for young people aged 16 to 18, which both specify a full-time study requirement.

FTB part B is not paid to a family after the end of the calendar year in which the young person turns 18.

The new participation requirements will apply from 1 January 2010 for new claimants and end of year lump sum claimants.

Families who have already claimed payments by instalment for a period before 1 January 2010 will have the new rules applied from 1 May 2010.

This later starting date for existing customers will give Centrelink adequate time to make necessary IT system changes.

This bill, along with the new youth allowance legislation, encourages young Australians to gain the skills and experience they need to move into work or further education.

It reflects the Australian Government’s commitment to do all we can to give every young Australian the best possible chance in life - recognising that education is vital to securing a productive, independent future.

Higher Education Support Amendment (VET FEE-HELP and Tertiary Admission Centres) Bill 2009

This R4194Bill amends the Higher Education Support Act 2003 as part of the Australian Government’s extension of the VET FEE-HELP Assistance Scheme to certain subsidised students from 1 July 2009.

The Government’s VET FEE-HELP Assistance Scheme provides financial assistance to students to ensure those wanting to study diploma and above qualifications in the vocational education and training sector are able to make real choices about their training without the burden of paying up-front fees.

The Government is committed to broadening and increasing Australia’s skill levels, and increasing the number of people with diploma and advanced diploma level skills is a key element of this commitment.

The availability of VET FEE-HELP is expected to significantly contribute to the Council of Australian Governments target to double the number of diploma and advanced diploma completions by 2020.

In this context, the Bill allows for provisions which support the expansion of VET FEE-HELP to more training organisations and State government subsidised students, even further removing financial barriers to study for those students.

From 1 July 2009, the Government extended VET FEE-HELP assistance to certain State government funded students with the aim of increasing access to financial assistance. As part of that extension, eligible State government-subsidised students will have a reduced VET FEE-HELP debt. This bill implements these changes for all eligible students from 1 July 2009, ensuring no eligible students are disadvantaged.

In addition, the Bill includes technical amendments to ensure that Tertiary Admissions Centres are able to perform certain functions in relation to personal information on behalf of both higher education and VET providers.

Tertiary Admissions Centres play an increasingly important role in the Australian tertiary system. These Centres add to the efficiency and productivity of the administration of the Australian tertiary system by centralising and co-ordinating admissions procedures on a state-wide basis.

These amendments ensure that student information may be appropriately shared between relevant Commonwealth agencies, higher education and VET providers and Tertiary Admissions Centres.

These measures are part of the Government’s commitment to ensuring that higher education and VET providers continue to play a leading role in equipping Australians with the knowledge and skills to make Australia a more productive and prosperous nation.

I commend this Bill.

Personal Property Securities (Consequential Amendments) Bill 2009


The Personal Property Securities (Consequential Amendments) Bill represents the next stage in the Government’s harmonisation of Australia’s personal property securities laws.

Currently there are over 70 Commonwealth, State and Territory laws, as well as common law and rules of equity governing security interests in personal property.

These different laws vary in their application according to the form of the transaction, the nature of the debtor or the jurisdiction in which the property is located. This adds significantly to transaction costs.

Personal property securities reform is an important part of COAG’s deregulation agenda.

By harmonising the current laws and creating a single national online register, the reform will have a real impact for business and consumers. Transaction costs will be reduced and businesses will be able to use more types of personal property to secure lending, resulting in them being able to secure lower interest rates.

This Bill will amend 25 Commonwealth Acts that deal with the creation, registration, priority, extinguishment or enforcement of interests in personal property.

The amendments are necessary to facilitate the establishment of a single national legal regime for security interests in personal property. The amendments will clarify the operation of legislation that will operate concurrently with the Personal Property Securities Bill once enacted.

This Bill also makes minor amendments to the Personal Property Securities Bill 2009 which was passed by the House on 16 September.

Amendments to other legislation

The Personal Property Securities (Consequential Amendments) Bill contains measures designed to harmonise language and concepts with the Personal Property Securities Bill.

The amendments will reduce complexity and increase consistency in the arrangements for creating, dealing with and enforcing security interests in personal property.

Importantly, the amendments will support a seamless transition to a single national Personal Property Securities Register by amending provisions in Commonwealth legislation that provide for the registration of security interests on a separate Commonwealth register.

For example, the Shipping Registration Act 1981 will be amended to change the current regime for creating and registering mortgages over ships. Such transactions solely within the ambit of the Personal Property Securities Bill.

Existing mortgages over ships, currently registered on the Australia Register of Ships, will be migrated to the Personal Property Securities Register.

The result will be that the Personal Property Securities Register will be the sole register for the registration of mortgages and other security interests in ships.

Amendments will also be made to the Designs Act 2003, the Trade Marks Act 1995 and the Patents Act 1990.

The registration of security interests on registers created by those Acts made after the commencement of the PPS scheme will have no effect on the registered owner of the intellectual property interest.

This will encourage registration of security interests in intellectual property on the PPS register and resolve any conflict between the PPS register and the intellectual property registers.

This Bill will also reinforce the privacy protections applied to the PPS Register.

The Privacy Act 1988 will be amended to confirm that unauthorised uses of Register data are ‘interferences with privacy’ under the Privacy Act and subject to the Privacy Commissioner’s powers of investigation.

The amendments effected by the Bill will resolve possible conflicts between the PPS Bill and Commonwealth legislation that provides for other interests in personal property.

The Bill will make it clear that the PPS scheme cannot be used to frustrate other legitimate interests in personal property.

In relation to the Commonwealth’s maritime and fisheries legislation for example, this Bill ensures that enforcement action taken under such legislation will not be circumvented by a secured party attempting to enforce a security interest under the Personal Property Securities Bill.

This Bill will also ensure that current rights and interests are preserved after the new PPS scheme commences operation.

In particular, where Commonwealth legislation has clearly provided for the priority of an interest in relation to a security interest in the same property, that priority will be preserved upon implementation of the Personal Property Securities Bill. An example is the priority of statutory liens held by Air Services Australia under the Air Services Act 1995.

Some additional amendments to Commonwealth legislation will be needed before the PPS scheme commences.

I foreshadow now that the Corporations Act 2001 will need to be amended as part of personal property securities reform.

Prior to the introduction of those amendments, the Government will conduct a consultation process on the proposed amendments in accordance with the inter-governmental Corporations Agreement. That consultation process will begin shortly.

Amendments to the PPS Bill

On 25 June 2009, the Senate referred the provisions of the Personal Property Securities Bill to the Senate Standing Committee on Legal and Constitutional Affairs for inquiry and report.

I thank the Committee for its thoughtful consideration of the Bill.

The Committee released its report in August 2009 and recommended that the Government consider the stakeholder concerns raised with the Committee and any further concerns brought to the Government’s attention until 30 September 2009. The Government has done this.

Following consideration of the submissions made to the Senate Committee and subsequently to my Department, a small number of minor amendments to the Personal Property Securities Bill were identified and are included in the Bill I introduce today.

The amendments will, among other things, address stakeholder comments that the operation of some provisions could be clarified and correct drafting errors.

The amendments have been included in this Bill because the PPS Bill is supported by a referral of legislative power by the States.

Moving Government amendments to the PPS Bill itself would cause some States to have to revisit their referral legislation.

The method adopted here - which provides the Parliament with the same opportunity to consider the changes to the Bill as Government amendments - will allow the States to continue the referral process without interruption.

I am pleased to advise that NSW, Queensland, South Australia and Victoria have all passed their referral legislation. I anticipate Western Australia and Tasmania will introduce their referral legislation shortly.


This Bill will facilitate the establishment of a single national regime for secured lending over personal property.

By harmonising legislation across the Commonwealth statute book, the Bill will provide greater consistency and support a seamless transition to the new national personal property securities regime.

A recent World Economic Forum survey ranked Australia second among global financial centres.

Making Australia’s secured transactions law more certain and consistent and less complex and costly will facilitate international investment in Australian businesses.

This will further strengthen Australia’s position as a leading global financial centre.

Tax Laws Amendment (Resale Royalty Right for Visual Artists) Bill 2009

This R4206Bill amends the tax law to apply a streamlined tax treatment to payments made in relation to the resale royalty right for visual artists, instead of the more complex trust taxation rules which would otherwise apply.

The proposed resale royalty right, which the Resale Royalty Right for Visual Artists Bill 2008 will establish, entitles eligible visual artists to a royalty payment on the sale price of any commercial resale of their original works of art over $1,000 for works acquired after that legislation takes effect. This will allow visual artists to share in the commercialisation of their work in the secondary art market. The resale royalty payable is 5 per cent of the sale price.

This Bill ensures that the body appointed by the Arts Minister as the resale royalty collecting society is not taxed on amounts it collects on behalf of resale royalty right owners and holds pending allocation to them. Specifically, the Bill exempts from income tax in the hands of the collecting society resale royalties, and interest on resale royalties, collected or derived by the collecting society. The collecting society is also not taxed on other income it may derive in an income year, up to a maximum of either 5 per cent of its total income or $5 million, whichever is the lesser.

When a payment is made from the collecting society to the resale royalty right holder, this amount is generally included in the individual’s assessable income. However if, for any reason, any part of this amount is or has been taxable in the hands of the collecting society, the amount to be included in the artist’s assessable income is reduced to reflect this.

This streamlined treatment is analogous to that which already exists for copyright payments handled by copyright collecting societies.

The Bill also makes several technical amendments to simplify the existing provisions in the tax law dealing with the treatment of copyright collecting societies. The operation of these provisions is not affected.

Finally, the Bill also amends the definition in the tax law of a copyright collecting society to ensure that if such a body were appointed as the resale royalty collecting society, it would not lose its status as a copyright collecting society merely because of that fact.

Full details of the measures in this Bill are contained in the explanatory memorandum.

Debate (on motion by Senator Sherry) adjourned.

Ordered that the Appropriation (Water Entitlements and Home Insulation) Bill 2009-2010 and the Appropriation (Water Entitlements) Bill 2009-2010 be listed on the Notice Paper together and that the Crimes Legislation Amendment (Serious and Organised Crime) Bill 2009, Fair Work Amendment (State Referrals and Other Measures) Bill 2009, Family Assistance Legislation Amendment (Participation Requirement) Bill 2009, Higher Education Support Amendment (VET FEE-HELP and Tertiary Admission Centres) Bill 2009, Personal Property Securities (Consequential Amendments) Bill 2009 and Tax Laws Amendment (Resale Royalty Right for Visual Artists) Bill 2009 be listed as separate orders of the day.