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Legal and Constitutional Affairs Legislation Committee


In Attendance

Senator Brandis, Attorney-General, Minister for the Arts


Mr Chris Moraitis PSM, Secretary

Mr Tony Sheehan, Deputy Secretary, Strategic Policy and Coordination Group

Mr David Fredericks, Deputy Secretary, Civil Justice and Legal Services Group

Ms Katherine Jones, Deputy Secretary, National Security and Criminal Justice Group

Outcome 1—A just and secure society through the maintenance and improvement of Australia's law and justice framework and its national security and emergency management system

Access to Justice Division

Mr Greg Manning, First Assistant Secretary

Dr Albin Smrdel, Assistant Secretary, Courts Tribunal and Justice Policy

Ms Elizabeth Quinn, Assistant Secretary, Legal Assistance

Ms Kelly Williams, Assistant Secretary, Marriage and Intercountry Adoption

Ms Sara Samios, Executive Director, Tribunals Amalgamation Taskforce

Ms Tamsyn Harvey, Assistant Secretary, Family Law

Civil Law Division

Mr Matt Minogue, First Assistant Secretary

Mr Andrew Walter, Assistant Secretary, Commercial and Administrative Law

Ms Cathy Rainsford, Assistant Secretary, Native Title Unit

Ms Jane Fitzgerald, Assistant Secretary, Classification

Ms Petra Gartmann, Assistant Secretary, Legal Services Policy Coordination

Ms Toni Pirani, Assistant Secretary, Commonwealth Representation Royal Commission

Constitutional and Corporate Counsel Division

Mr James Faulkner SC, First Assistant Secretary

Ms Helen Daniels, Special Advisor

Corporate Division

Mr Stephen Lutze, Chief Financial Officer

Mr Justin Keefe, Assistant Secretary, Service Centre

Mr Trevor Kennedy, Assistant Secretary, Financial Management, Framework and Property

Criminal Justice Division

Mr Iain Anderson, First Assistant Secretary

Mr Anthony Coles, Assistant Secretary, Criminal Law and Law Enforcement

Ms Catherine Smith, Assistant Secretary, Crime Prevention and Federal Offenders

Mr Michael Pahlow, Assistant Secretary, AusCheck

Ms Tara Inverarity, Head, Operation Sovereign Borders Legal Issues Taskforce

Defence Abuse Response Taskforce

Mr Matt Hall, Executive Director

Emergency Management Australia

Mr Mark Crosweller AFSM, First Assistant Secretary

Mr Aaron Verlin, Assistant Secretary, National Disaster Recovery Programmes

Mr Chris Collett, Assistant Secretary, Crisis Coordination

Mr Mike Norris, Acting Assistant Secretary, Dignitary and Major Events Security

Ms Rachel Antone, Assistant Secretary, National Security Training, Education and Development

Information Division

Ms Joann Corcoran, First Assistant Secretary

Mr Shaun McGuiggan, Assistant Secretary, Innovation Service and Delivery

International Law and Human Rights Division

Mr John Reid, First Assistant Secretary

Ms Anne Sheehan, Assistant Secretary, International Law, Trade and Security

Mr Bill Campbell QC, General Counsel

Mr Paul Pfitzner, Acting Assistant Secretary, Human Rights Policy

Ms Sue Robertson, Assistant Secretary, International Human Rights Law

International Crime Cooperation Division

Ms Catherine Hawkins, First Assistant Secretary

Mr Kieran Butler, Acting Assistant Secretary, Transnational Crime and Corruption

Mr Chris Faris, Acting Assistant Secretary, International Crime Cooperation Central Authorities

Ms Elizabeth Brayshaw, Acting Assistant Secretary, International Legal Assistance

National Security Law and Policy Division

Ms Jamie Lowe, First Assistant Secretary

Ms Catherine Jones, Assistant Secretary, National Security Policy and Capability

Ms Anna Harmer, Assistant Secretary, Electronic Surveillance Policy

Ms Annette Willing, Assistant Secretary, Office of the National Security Legal Adviser

Mr Cameron Gifford, Assistant Secretary, Counter-Terrorism Law

National Security Resilience Policy Division

Dr Carolyn Patteson, Acting First Assistant Secretary

Mr Andrew Rice, Assistant Secretary, Cyber and Identity Security Policy

Mr David Campbell, Acting Assistant Secretary, Cyber Security Operations and Infrastructure Modelling

Mr Michael Jerks, Assistant Secretary, Critical Infrastructure Protection

Ms Samantha Chard, Assistant Secretary, Emergency Management Policy

People Strategy

Ms Rachael Jackson, Assistant Secretary

Royal Commission into Institutional Response to Child Sexual Abuse

Mr Philip Reed, Chief Executive Officer

Royal Commission into Trade Union Governance and Corruption

Ms Sue Innes-Brown, Chief Executive Officer

Mr Mark Ney, Commander, Police Taskforces

Strategy and Delivery Division

Ms Sarah Chidgey, First Assistant Secretary

Ms Ayesha Perry, Assistant Secretary, Strategy and Delivery

Mr Will Story, Assistant Secretary, Constitutional Recognition of Indigenous Australians

Outcome 2— Participation in, and access to, Australia's arts and culture through developing and supporting cultural expression

Ministry for the Arts

Ms Sally Basser, First Assistant Secretary

Ms Asha Rajah-Clarke, Acting Assistant Secretary, Access and Participation

Ms Lyn Allan, Assistant Secretary, Creative Industries

Mr Simon Kelly, Acting Assistant Secretary, Collections and Cultural Heritage

Dr Stephen Arnott PSM, Assistant Secretary, Arts Development and Investment

Australian Commission for Law Enforcement Integrity

Mr Michael Griffin AM, Integrity Commissioner

Mr Nick Sellars, Executive Director, Secretariat

Australia Council

Mr Tony Grybowski, Chief Executive Officer

Mr Tim Blackwell, Executive Director, Corporate Resources

Mr Frank Panucci, Executive Director

Australian Crime Commission

Mr Chris Dawson APM, Chief Executive Officer

Ms Judy Lind, Executive Director, Strategy and Specialist Capabilities

Mr Paul Williams, Executive Director, Corporate Services

Mr Warren Gray, Acting Executive Director, Operations

Australian Federal Police

Mr Andrew Colvin OAM APM, Commissioner

Mr Andrew Wood, Chief Operating Officer

Mr Graham Ashton AM APM, Deputy Commissioner, Capability

Ms Leanne Close APM, Deputy Commissioner, Operations

Mr Michael Phelan APM, Deputy Commissioner, National Security

Australian Film, Television and Radio School

Ms Sandra Levy, Chief Executive Officer

Ms Anne Browne, Director, Corporate and Production Services

Australian Financial Security Authority

Ms Veronique Ingram, Chief Executive Officer

Mr Andrew Sellars, General Counsel

Mr Gavin McCosker, Chief Operating Officer

Mr Robert Hanlon, Chief Financial Officer

Australian Human Rights Commission

Professor Gillian Triggs, President

Ms Elizabeth Broderick, Sex Discrimination Commissioner

Ms Julie O'Brien, Director, Legal Services

Ms Megan Mitchell, National Children's Commissioner

Ms Michelle Lindley, Deputy Director, Legal Services

Mr Mick Gooda, Aboriginal and Torres Strait Island Social Justice Commissioner

Ms Padma Raman, Executive Director

The Hon Susan Ryan AO, Age and Disability Discrimination Commissioner

Dr Tim Soutphommasane, Race Discrimination Commissioners

Mr Tim Wilson, Human Rights Commissioner

Australian Law Reform Commission

Professor Rosalind Croucher, President

Ms Sabina Wynn, Executive Director

Australian National Maritime Museum

Mr Kevin Sumption, Director and Chief Executive Officer

Mr Peter Rout, Assistant Director, Operations

Mr Frank Shapter, Chief Financial Officer

Bundanon Trust

Ms Deborah Ely, Chief Executive Officer

Mr Richard Montgomery, Chief Operating Officer

Commonwealth Director of Public Prosecutions

Mr Robert Bromwich SC, Director of Public Prosecutions

Ms Gaby Medley-Brown, Chief Corporate Officer

Crimtrac Agency

Ms Nicole Rose, Chief Executive Officer

Mr Lee Walton, Chief Information Officer

Ms Nicole Mayo, Chief Operating Officer

Creative Partnerships Australia

Ms Fiona Menzies, Chief Executive Officer

Ms Emma Calverley, Executive Director, Operations and Marketing

Mr Matthew Morse, Executive Director, Strategy and Programs

Family Court of Australia/Federal Circuit Court of Australia

Mr Richard Foster PSM, Chief Executive Officer

Mr Adrian Brocklehurst FCPA, Executive Director, Corporate and Chief Financial Officer

Mr Steve Agnew, Executive Director, Operations

Federal Court of Australia

Mr Warwick Soden, Chief Executive Officer

Dr Debbie Fletcher, Deputy Registrar, Native Title Tribunal

Mr Mario Torresan, Director, Corporate Services

Mr Peter Bowen, Chief Financial Officer

High Court of Australia

Mr Andrew Phelan, Chief Executive and Principal Registrar

Ms Carolyn Rogers, Senior Registrar

Mr Jeff Smart, Manager, Corporate Services

Museum of Australian Democracy at Old Parliament House

Ms Daryl Karp, Director

Mr Andrew Harper, Deputy Director, Business Operations and Heritage

National Archives of Australia

Mr David Fricker, Director-General

Ms Cheryl Watson, Assistant Director-General, Corporate Services Branch

Mr Craig Maconachie, Director, Finance, Corporate Services Branch

Mr Lennard Marsden, Assistant Director-General, Executive and Information Services Branch

National Film and Sound Archive of Australia

Mr Michael Loebenstein, Chief Executive Officer

Ms Denise Cardrew-Hall, Chief Financial Officer and General Manager, Corporate and Business Affairs

National Gallery of Australia

Dr Gerard Vaughan AM, Director

Mr David Perceval, Assistant Director, Corporate Services

Mr Simon Elliott, Assistant Director, Curatorial and Educational Services

National Library of Australia

Ms Anne-Marie Schwirtlich, Director-General

Mr Peter Hughes, Director, Finance Branch

National Museum of Australia

Dr Mathew Trinca, Director

National Portrait Gallery of Australia

Mr Angus Trumble, Director

Office of Parliamentary Coun se l

Mr Peter Quiggin PSM, First Parliamentary Counsel

Ms Aasha Swift, General Manager, Publishing

Ms Susan McNeilly, General Manager and Chief Finance Officer

Screen Australia

Mr Graeme Mason, Chief Executive Officer

Ms Fiona Cameron, Chief Operating Officer

Mr Richard Nankivell, Chief Financial Officer

Committee met at 09:03

CHAIR ( Senator Ian Macdonald ): Good morning, all. Good morning, Minister and Mr Moraitis. Thank you for being with us. I declare open this public hearing of the Senate's Legal and Constitutional Affairs Legislation Committee. The Senate has referred the proposed expenditure for 2015-16 for the portfolios of Attorney-General and Immigration and Border Protection, and other related documents, to this committee. We are also able to examine the annual reports of the department and the agencies. Today we are dealing with the Attorney-General's portfolio.

The committee has set Friday, 10 July 2015 as the date by which answers to questions on notice are to be returned. It also decided that the written questions on notice should be provided to the secretariat by 5 June. Under standing order 26, the committee must take all evidence in public. Witnesses are aware of parliamentary privileges and that it is unlawful for anyone to threaten or disadvantage a witness on account of the evidence given to the committee.

Officers and senators are familiar with the rules of the Senate governing estimates hearings, but if anyone does have a query, the secretariat has copies of the rules and can help. Any question going to the operations or financial positions of departments or agencies which are seeking funds in estimates are relevant questions for the purpose of today's hearings. There are no areas in connection with the expenditure of public funds where any person has the discretion to withhold details or explanations from parliament or its committees unless parliament has expressly provided otherwise.

The Senate has resolved that an officer of the department shall not be asked questions of opinion on matters of policy and should be given reasonable opportunity to refer questions to a superior officer or to the minister. This relates only to asking questions on opinions on matters of policy. It does not preclude questions asking for explanation of policies or factual questions about how policies came into being.

There is an order of the Senate relating to public interest immunity claims. A statement that a document is confidential or consists of advice to government is not a statement that meets the requirements of the 2009 order. Witnesses are required to provide some specific indication of the harm to the public interest that could result from the disclosure of the information or the document.


The extract read as follows—

Public interest immunity claims

That the Senate—

(a) notes that ministers and officers have continued to refuse to provide information to Senate committees without properly raising claims of public interest immunity as required by past resolutions of the Senate;

(b) reaffirms the principles of past resolutions of the Senate by this order, to provide ministers and officers with guidance as to the proper process for raising public interest immunity claims and to consolidate those past resolutions of the Senate;

(c) orders that the following operate as an order of continuing effect:

(1) If:

   (a) a Senate committee, or a senator in the course of proceedings of a committee, requests information or a document from a Commonwealth department or agency; and

   (b) an officer of the department or agency to whom the request is directed believes that it may not be in the public interest to disclose the information or document to the committee, the officer shall state to the committee the ground on which the officer believes that it may not be in the public interest to disclose the information or document to the committee, and specify the harm to the public interest that could result from the disclosure of the information or document.

(2) If, after receiving the officer’s statement under paragraph (1), the committee or the senator requests the officer to refer the question of the disclosure of the information or document to a responsible minister, the officer shall refer that question to the minister.

(3) If a minister, on a reference by an officer under paragraph (2), concludes that it would not be in the public interest to disclose the information or document to the committee, the minister shall provide to the committee a statement of the ground for that conclusion, specifying the harm to the public interest that could result from the disclosure of the information or document.

(4) A minister, in a statement under paragraph (3), shall indicate whether the harm to the public interest that could result from the disclosure of the information or document to the committee could result only from the publication of the information or document by the committee, or could result, equally or in part, from the disclosure of the information or document to the committee as in camera evidence.

(5) If, after considering a statement by a minister provided under paragraph (3), the committee concludes that the statement does not sufficiently justify the withholding of the information or document from the committee, the committee shall report the matter to the Senate.

(6) A decision by a committee not to report a matter to the Senate under paragraph (5) does not prevent a senator from raising the matter in the Senate in accordance with other procedures of the Senate.

(7) A statement that information or a document is not published, or is confidential, or consists of advice to, or internal deliberations of, government, in the absence of specification of the harm to the public interest that could result from the disclosure of the information or document, is not a statement that meets the requirements of paragraph (1) or (4).

(8) If a minister concludes that a statement under paragraph (3) should more appropriately be made by the head of an agency, by reason of the independence of that agency from ministerial direction or control, the minister shall inform the committee of that conclusion and the reason for that conclusion, and shall refer the matter to the head of the agency, who shall then be required to provide a statement in accordance with paragraph (3).

(d) requires the Procedure Committee to review the operation of this order and report to the Senate by 20 August 2009.

(13 May 2009 J.1941)

(Extract, Senate Standing Orders, pp 124-125)

Minister, would you, or the secretary, like to make an opening statement before we start?

Senator Brandis: No, thank you.

Mr Moraitis : No, Chair.

CHAIR: First of all we are dealing with outcome 2, Ministry for the Arts. It is up to the committee but perhaps more to Mr Moraitis, whether you want the officers of the Australia Council, Screen Australia and the National Film and Sound Archives of Australia with you, or will we get them up to the table as people have questions for them?

Senator Brandis: I suspect as required.

CHAIR: Neither of you want to make a statement in relation to the Ministry for the Arts as such?

Senator Brandis: No.

Senator JACINTA COLLINS: I should indicate that it probably will not be too long before the Australia Council are required to come forward. Can I deal first though with unanswered questions on notice. I do not want to go into detail at this stage with the Arts, because I think it is a broader issue we should cover at the cross-portfolio stage. There are a number of my questions to the Ministry for the Arts and Screen Australia that I understand are still outstanding. Have we had progress there?

Senator Brandis: I am having that checked now. I was not aware that there were any Arts questions outstanding. In fact I have—

Senator JACINTA COLLINS: My list says of the Ministry for the Arts eight, of Screen Australia three.

Senator Brandis: If I may finish before you interrupt me. I believe I have cleared all of the questions outstanding for this committee, though some of them I cleared fairly recently. Anyway, I will have that checked and we will let you know.

CHAIR: Senator Collins, could you numerate—or have you done that—which ones and perhaps the secretary could follow them through.

Senator JACINTA COLLINS: The list that we have been provided with from the secretariat does not have the actual question on notice numbers, but there are eight from myself to the Ministry for the Arts and three to Screen Australia. I cannot elaborate on the question numbers at the moment.

Senator Brandis: Can you give us the date please?

Senator JACINTA COLLINS: We can come back to that.

Senator Brandis: I am advised, as I thought, that I have cleared all of the questions directed to the Ministry for the Arts. Some of them may not have yet made their way through the secretariat, but I have cleared them all.

CHAIR: You have cleared what was given to you. I guess it is a question of: have the relevant agencies given them to you?

Senator Brandis: My understanding is that all questions taken on notice in relation to the Ministry for the Arts, including agencies, have come to me and been cleared by me—not very long ago, I must say. It may be that some of the outstanding ones just have not found their way to the secretariat yet.

CHAIR: If they do not get to the secretariat, whose responsibility is that? Is it your office, Minister, or the secretary's area?

Senator Brandis: They come—as you know, Senator, from your own experience as a minister—to the minister for clearing and the minister clears them. They are then, I think, sent to the department to be lodged with the secretary of the committee.

Mr Moraitis : I will undertake to follow-up with the secretary directly to get details of those and provide you an answer as soon as possible.

CHAIR: As soon as you could would be helpful.

Mr Moraitis : Yes.

Senator Brandis: I have just—these are the wonders of instantaneous communication—had a message from the relevant DLO, confirming that I have cleared all the Arts questions of notice, and they should all have been tabled.

Senator JACINTA COLLINS: So when were they cleared?

Senator Brandis: In the past. Some of them quite recently.

Senator JACINTA COLLINS: The issue here is that if they are not cleared in sufficient time for us to receive them before the full round of budget estimates, it is an issue for scrutiny. I am not going to press for exactly when in the past they were cleared, but I think the point is pretty clear: they are not here and we have not had an opportunity to review them before we deal with the Ministry for the Arts now.

Senator Brandis: Mr Moraitis has said that he will look at the matter, and I have been able to give you the assurance that they have all been cleared. So there is nothing you are waiting on me to do, and that is really all I can say.

Senator JACINTA COLLINS: As I said, I am not going to spend too much time here on this. But we will revisit it when we get to cross-portfolio because there are in total about 101 questions outstanding before today's hearings, at least from the committee end.

CHAIR: 101?


Senator Brandis: I thought you said there were eight.

Senator JACINTA COLLINS: No, there were eight of mine for the Ministry for the Arts. This is why—

Senator Brandis: I thought that we were talking about the Ministry for the Arts questions.

Senator JACINTA COLLINS: I beg your pardon?

Senator Brandis: I thought that is what you were talking about—questions to the Ministry for the Arts.

Senator JACINTA COLLINS: No—what I indicated was that I have some issues with the Ministry for the Arts because I have not received replies and that I have broader concerns because there is a much larger list of answers to questions in relation to cross-portfolio and other areas that the secretariat has yet received. that I will revisit this issue when we get to cross-portfolio, by which time Mr Moraitis may be in a better position to deal with why we are in this situation.

Senator Brandis: As I told you before: I have cleared them all and I am advised that they have all been tabled.

Senator JACINTA COLLINS: Mr Moraitis?

CHAIR: This was raised at a committee meeting, I think, and I think my office got in touch with your office, Attorney, just to issue a gentle reminder that there were a number of questions not yet answered. So it has been a concern to the committee. Anyhow, we had better find out what the facts are before we take it much further.

Mr Moraitis : If I may, Mr Fredericks can follow-up on the issue of the eight outstanding Arts questions pertaining to this message.

Mr Fredericks : I can just confirm, in relation to the Arts, that our collective understanding—that is, ourselves and the committee secretariat—is that all relevant Arts questions bar three were tabled some few days ago. There were three Arts questions tabled last night. So it seems that those three may not yet have got through the system. In short: three tabled last night and the remainder tabled some days and weeks before.

CHAIR: The secretariat will no doubt be looking for them and will liaise with you, Mr Fredericks, or your office, to see where they are so that we can try to at least get them before we are finished with the Ministry for the Arts.

Senator JACINTA COLLINS: With respect to ministry staff, can you tell me the number of full-time equivalent positions in the ministry on 7 September 2013, 30 June 2014 and today?

Ms Basser : The full-time equivalent staff in the ministry, excluding Artbank because that self-funds its staff, was: 7 September 2013, 114 FTE; 30 June 2014, 95 FTE; and 1 April 2015, 105 FTE.

Senator JACINTA COLLINS: You say Artbank self-funds, but can you tell me those figures?

Ms Basser : Yes—18 FTE on 7 September 2013, 13 FTE on 30 June 2014 and 12 FTE on 1 April 2015.

Senator JACINTA COLLINS: Thank you. I would like to go to the reduction in funding to the arts council and the creation of the National Program for Excellence in the Arts. I will ask the department and the minister at this stage what consultations with the board or the executive of the Australia Council took place before the announcement of the new National Program for Excellence in the Arts—I just call it the minister's discretionary fund—

Senator Brandis: Why don't we call it by its name: the National Program for Excellence in the Arts?

Senator JACINTA COLLINS: Because it takes so long! Do you think an acronym would work better?

Senator Brandis: You could call it the NPEA, but it is a program, it does have a name and I think it is probably regular to call it by its name.

Senator JACINTA COLLINS: We will make that value judgement as we get closer to understanding how it is going to operate.

Senator Brandis: It is not a value judgement; it is a question of accuracy.

Senator JACINTA COLLINS: We could debate that till the sun goes down, but I'd rather not keep you that long.

Senator Brandis: I could call you Mrs Collins, but you have a title. You have an actual official name.

Senator JACINTA COLLINS: It would not offend me. Anyway, I go back to my question, which is: what consultations with the board or the executive of the Australia Council took place before the announcement of the NPEA and the resulting changes to the council's functions and funding?

Senator Brandis: I speak on a regular basis with the Chairman of the Australia Council, Mr Rupert Myer, and less frequently but nevertheless quite often with the CEO of the Australia Council, Mr Tony Grybowski, about matters generally affecting the Australia Council. My office and in particular my arts adviser speak to those gentlemen more frequently than I do. We discuss all sorts of matters in relation to arts funding.

In relation to the specific program about which you ask—the National Program for Excellence in the Arts—I telephoned Mr Myer late in the afternoon of budget day to tell him what the government had decided to do.

Senator JACINTA COLLINS: So ahead of your phone conversation to Mr Myer on 12 May there had been no consultation regarding that announcement.

Senator Brandis: Not that particular announcement, but you have to understand that there is a lively debate about the best model for arts funding. It has been going on for as long as there has been an Australia Council. I quite commonly speak with people in the sector, including the Australia Council, about the broad issue of arts funding. In relation to the particular program about which you asked, I advised the Australia Council what the government was proposing to do late on the afternoon of budget day.

Senator JACINTA COLLINS: Related to the lively debate about the best model, I note the answer to question on notice AE15/139, which stated—

Senator Brandis: Do you have a copy of it?

Senator JACINTA COLLINS: The secretariat will print it out for you, but I am about to read it.

Senator Brandis: I would just like to read it for myself if I may.


CHAIR: Minister, I hope your department has a folder of the answers to questions on notice.

Senator Brandis: Yes, Mr Basser is looking it up right now. Here we are. I have it in front of me.

Senator JACINTA COLLINS: Okay. I am referring to the answer that reads:

The implementation of Australia Council’s strategic and corporate plan includes new arrangements for the delivery of grants to artists and arts organisations, and a range of new project based initiatives. Subsequently, a whole of organisation review and restructure was conducted from July to December 2014, with effect from January 2015.

I ask: will the whole-of-organisation review and restructure which took six months to complete now have to be redone?

Senator Brandis: I think that is a question for the Australia Council.

Senator JACINTA COLLINS: Then they can come forward now. I did allude to the fact it was not going to be long.

Mr Grybowski : Could you repeat the question?

Senator JACINTA COLLINS: Sure. Will the whole-of-organisation review and restructure which took six months to complete between July and December 2014 now need to be redone?

Mr Grybowski : The short answer is no.

Senator JACINTA COLLINS: I would like the long answer. That is good.

Mr Grybowski : The organisational restructure has created a more flexible, responsive, nimble organisation to be able to respond to the policy direction and funding framework that we have established. That flexibility is able to respond to the new policy and, indeed, budget measures which were announced at the last budget.

Senator JACINTA COLLINS: Did that flexibility identify 12 per cent savings?

Mr Grybowski : Savings were not identified as part of the PBS. As I think I have been on record previously saying—

Senator JACINTA COLLINS: Sorry; as part of the PBS?

Mr Grybowski : The portfolio budget statement.

Senator JACINTA COLLINS: No, I am talking about the organisation review.

Mr Grybowski : Sure, but our administrative and staffing levels are actually outlined in the PBS.

Senator JACINTA COLLINS: I understand that.

Mr Grybowski : As I think I have said previously on the record, over the last 12 months, we have been going through a period of review and change in operating in the past and now in our new structure. Savings would be identified into the future; but, until we were operating in that environment, they were yet to be determined.

Senator JACINTA COLLINS: So, as part of this lively debate about the best model for funding of the arts, were you anticipating that you would be facing 12 per cent cuts?

Mr Grybowski : The news came as a surprise to us; however, our role as the Australian government's arts funding and advisory body is obviously to work very closely with the government of the day and implement the policy and, indeed, the budget provided to us.

Senator JACINTA COLLINS: I understand. We will get to some more on that a bit later. I ask the minister or the department what will be the categories and guidelines for grants funding under the—let me get the acronym right again—NPEA?

Senator Brandis: Broadly, there are three streams that we propose. One is endowments, one is strategic projects and one is international touring and international cultural programs. Perhaps Ms Basser, who is in charge of the design of the funding model under the NPEA, can elaborate more fully.

Ms Basser : To answer the first question: yes, there certainly will be guidelines. As a Commonwealth department, we comply with the Commonwealth grants rules and guidelines, and those guidelines will go through the formal approval process consistent with the Department of Finance rules and guidelines of grants. We are in the process of working that through now. In terms of what we are anticipating the program might look like, we are anticipating that the new program will benefit audiences, artists and small, medium and large organisations. We are anticipating that program funding will be available to assist with the cost of delivering arts and cultural projects on an annual or multi-year basis. As the Attorney has said, there will be three streams—the first is the endowment stream. We anticipate that the endowment stream will be open to a wide range of projects that may include examples such as supporting a small-to-medium arts organisation that is established as a foundation by providing an investment into the foundation; supporting a regional museum or gallery to realise an infrastructure project; investing in the development of new Australian works of significance and scale or providing support to a foundation or arts organisation to deliver a fellowship program.

We anticipate that the international and cultural diplomacy stream will support international touring and cultural diplomacy projects. The international and cultural diplomacy stream will help to showcase Australia's artistic talent and cultural heritage, support international collaborations and support Australia's cultural diplomacy objectives. There is also the strategic initiative stream. Strategic funding is a key mechanism for driving outcomes against planned and developing priorities and to respond to new opportunities, challenges and issues, and that is the direction that we will be developing in relation to that third element of the program.

Senator JACINTA COLLINS: Can you repeat those.

Ms Basser : The international and cultural diplomacy stream and the strategic initiatives stream.

Senator JACINTA COLLINS: And the third?

Ms Basser : The strategic initiatives stream. There is the endowment stream, the international and cultural diplomacy stream and the strategic initiatives stream.

Senator JACINTA COLLINS: When do you anticipate the guidelines will be published?

Ms Basser : We are working very hard. The process, as you may be aware, obviously involves us developing the guidelines. We are required to consult with the Department of the Prime Minister and Cabinet and the Department of Finance, then we will provide advice to the Attorney. The final stage of the process is seeking the agreement of the Minister for Finance. We are hoping that, within the parameters of that process, the guidelines will be available by the end of June or in early July.

Senator JACINTA COLLINS: When would you anticipate applications for grants under the new arrangements will be announced?

Ms Basser : We would anticipate—and again I just caveat this as anticipate, because the guidelines have not been approved—that as soon as the guidelines are publicly released, the program would be open for applications.

Senator JACINTA COLLINS: Is there anything further you can tell me at this stage about the criteria?

Ms Basser : No, Senator.

Senator JACINTA COLLINS: Are they likely to bear any relationship to the current arrangements under the Australia Council?

Ms Basser : The Australia Council is not required to comply with the Commonwealth grants rules and guidelines, so we have to ensure our guidelines too. We are consulting very closely with the Australia Council in terms of our work. They are going to be different because it is a different program and for a different purpose, but we are obviously talking with them, tackling accessing their knowledge and expertise as well. But in the end our guidelines are for a specific program, and they must comply with the Commonwealth grant rules and guidelines.

Senator Brandis: I think that is an important point to be borne in mind in this debate; that whatever guidelines are administered within the ministry are subject to those finance department rules and guidelines in a way that the Australia Council is not. There is a particular funding model for the Australia Council, a particular set of processes, but to suggest that there is any lack of transparency in the way these programs will be administered by the ministry is not only wrong—

Senator JACINTA COLLINS: I am sorry—I have not made that suggestion.

Senator Brandis: But some have, and I thought I might take the opportunity to correct it. The processes are subject to guidelines that the Australia Council's funding decisions are not.

Senator JACINTA COLLINS: Ms Basser, what key differences would you say generate the Commonwealth funding guidelines as opposed to the arrangements the Australia Council operates under?

Ms Basser : I suppose I am not familiar in terms of the exact detail of the Australia Council guidelines. Certainly, within the Commonwealth guidelines there is a specific set of criteria and there are specific plans for planning and design that we have to formally tick off against. I would say there is probably a little more flexibility as to how they might be able to plan and execute their guidelines. I am not suggesting there is a problem with that. That is the fact, that we as a Commonwealth department comply with these guidelines.

Senator JACINTA COLLINS: I can review the Commonwealth guidelines myself; I will not pursue that line of questioning. You made the point that this is a different program for a different purpose. Perhaps you could elaborate for me on the differentness you are alluding to there?

Ms Basser : This is a program that does not currently exist either in the Australia Council or the ministry; it is a new program which was a decision of the government.

CHAIR: I also have some questions on this new program.

Senator JACINTA COLLINS: Just before you start, Chair, on the earlier issue about questions on notice, just so Mr Fredericks is able to follow that up. We have the list of those that I think what only filed last night.

CHAIR: I meant to raise this—and thank you, Senator Collins—not in a political sense, which no doubt you will, but in defence of the secretariat. The eight questions that Senator Collins was talking about in the arts area were tabled last night. The secretariat only received them this morning and hence the secretary has not had the opportunity of making them available to members. I simply raise that in defence of the secretariat, who have in no way held up the system. Senator Collins, you may want to comment further.

Senator JACINTA COLLINS: No. I just want to facilitate the process for when we revisit it, so Mr Fredericks can understand why this logjam has occurred and hopefully will not occur again.

CHAIR: Okay. I have some questions in relation to this program. But before I start, Minister, I want to congratulate you on this program. I have long had a view that, in a representative government, the government gets the criticism where arts funding is not appropriate—that is, in relation to the Festival of Chamber Music. It was the government that was getting the criticism, when in fact the government had absolutely no power whatsoever to do anything about it. I do acknowledge, in mentioning that, that the Australia Council have in fact come good and I am very appreciative of that. I should acknowledge that too and say thank you very much and, on behalf of the festival, thank you for your assistance this year and in the past.

Minister, I have long thought that where governments are held responsible for different programs, they should be the ones that make the decisions. I have held this view since back when CASA used to independently act but Mr Anderson, as the transport minister, got all the criticism but was powerless to do anything about CASA. I think the same here. Congratulations on doing this. I think it is a wonderful initiative. It means that you will respond to urgings by all elected representatives who are indeed contacted by their local constituents about it. Well done.

When does the money actually become available in this program?

Senator Brandis: What we propose to do is to have the funding rounds open from the beginning of the coming financial year. These guidelines will be published in coming weeks and then we will advertise. Ms Basser might be able to add to these remarks, but we would anticipate that there will be funding rounds. The actual date, and to use your words, for 'when the money will become available' is yet to be determined. The expectation is that applications will be able to be made from the beginning of the coming year.

Ms Basser : The funding commences next financial year. So the funding is available from 1 July.

Senator Brandis: Subject to the applications being received and assessed appropriately, obviously.

Ms Basser : That is right. But the appropriation is there from 1 July and obviously we have to have the guidelines approved and published, and all those other processes happening.

Senator Brandis: Senator Macdonald, can I take a moment—and I do not want to use up too much of your time—to thank you for your endorsement of the new program and to explain to the committee the thinking behind it, because it has attracted both criticism and praise from within the sector. I said in my answer to Senator Collins before that there has been a lively debate for a long time about the proper structure for arts funding. I wonder if I might read into the Hansard—it will take me only a minute or two—a short statement.

Many of my critics are enthusiastic and uncompromising supporters of the 'arm's length principle', as they proclaim it, when it suits them, yet have no hesitation in demanding my direct intervention when it does not. By far the greatest number of representations to me about the arts involve groups or individuals seeking my intervention to reverse a particular decision of the Australia Council or of one of its boards.

…   …   …

The notion of 'arm's length' funding of the arts was an important concept in the setting up of the Australia Council … As far as I am aware, most other countries with which we normally compare ourselves accept a different democratic principle regarding the implementation of government policy and the expenditure of public money. Governments are elected to govern; to make decisions. If the electors do not like these decisions, they replace the Government with one more to their liking. This principle of Ministerial responsibility is generally demanded of governments in Australia. In relation to the arts, the present legislative arrangements make it near impossible to achieve.

…   …   …

The other major patrons in Australia are the State governments and private companies. Neither of these groups practise 'arm's length funding'.

…   …   …

Is there any artist in Australia who can, with hand on heart, say that he or she knows of no unfair exercise of patronage, or further, that no member of the staff or of the Australia Council, that bastion of 'arm's length principles', or a member of its boards, has in the last 10 years ever been guilty of seeking preference for a friend, or of arranging for a grant for a supporter? The present system, it can be argued, protects partial patronage and hides prejudice beneath a cloak of artistic integrity.

Senator Macdonald, those words are not mine; those are the words of the person who I think was the Labor Party's greatest arts minister, Mr Barry Cohen, in a statement he made on cultural policy to the House of Representatives as long ago as 17 October 1985, in the early days of the Hawke government, 30 years ago. While I would not necessarily adopt every word Mr Cohen then used—Mr Cohen, happily, by the way, is still with us; he is still a columnist, as you know, in the national newspapers—I read that statement onto the record to illustrate the point that this is a very longstanding debate and it is not a party political debate.

There are those who take a very purest view and say that no arts dollars should be spent except at arms-length from government by a peer reviewed process through the Australia Council and there are those who take the opposite view and say that every dollar that is spent by government should ultimately bear the impress of the minister's endorsement so the minister can be answerable for it but, as in most of these debates, the sensible position I think lies in the middle. What we have tried to do is reflect the fact that the Australia Council and the arms-length process is a good model, which is why 88 per cent of arts expenditure will continue to be directed through the Australia Council, but also to accommodate the alternative view that there ought to be some ministerial responsibility for arts funding by providing for about 12 per cent of funding in the National Program for Excellence in the Arts, for which the minister is directly responsible, so those who favour the Australia Council model have their views fully accommodated and those who are critics of it also have their view accommodated. That is why I said all along that the principle underlying this new model is contestability.

CHAIR: Thank you, Senator Brandis. There are a couple of further questions arising from what you have said, but I repeat what Senator Collins has just whispered to me. I might have thought you might have made an opening statement on that rather than using my valuable 15 minutes—

Senator Brandis: I am sorry. I was not real sure where this was going to go.

CHAIR: I was encouraging you to make an opening statement and I should have spoken to you beforehand of course, which I did not get time to do. But I do appreciate that. I might say it did not sound like your terminology, but can I say that I agree entirely with Mr Cohen and that has been my view not only on this but as I mentioned on CASA and other issues, where the government bears the responsibility. In a democracy of course it is, I think, parliamentarians and ministers who should be making the issues. So I agree with Mr Cohen—perhaps we are of the same vintage, but I will not go there. So well done. I do think it is an important principle and I do again congratulate you for perhaps following Mr Cohen's advice all those years ago. The Australia Council will continue in the same way as they have before albeit with slightly less money?

Senator Brandis: Yes, they will. As you would be aware, the Australia Council was restructured significantly as a result of amendments to its act in the dying days of the last Labor government, and they came into effect I think on 1 July 2013. So the structure is different from the way it was prior to that, but subject to that observation the answer is yes.

CHAIR: Minister, or ,Mr Moraitis, in relation to grants that you make, you will be accountable, Minister, and I can imagine some robust exchanges at estimates. Is the Australian Council, under its rules, accountable to anyone apart from its own board, and what happens in these hearings, of course?

Senator Brandis: Yes, it is. It is accountable to this committee. It is in relation to its overall governance accountable to the minister. There is a section of the Australia Council Act, Mr Grybowski might remind me what section it is, which says words to the effect that the minister may give directions to the Australia Council but is prohibited from giving directions in relation to the fate of a particular funding application. Section 12 I am told by my very industrious arts adviser, Mr Napthali.

CHAIR: So what has seemed to work in the past by some will continue with the Australia Council's arrangement and there will be this new, open, public accountable procedure that will happen as from 1 July?

Senator Brandis: I do not say the Australia Council is not accountable. Another way it is accountable of course is that it has a statutory obligation to table an annual report, which of course can be debated in the parliament. But it is protected from interference in relation to particular grant decisions. That is the arms-length principle, which I do not dispute. But you will recall the very long discussion we had about the Australian Festival of Chamber Music at a recent estimates committee. That is a good case study actually of why we wanted to have this alternative funding stream because that was a music festival that everybody thought, including Mr Grybowski, I remember, was a very worthy music festival, but there were particular reasons why it was not being funded in the coming year by the Australia Council. What does an applicant with a worthy, supportable and publicly well-accepted policy do if the Australia Council says no? Well, under the previous arrangements, there was nowhere else to go, at least within the Commonwealth; now there is.

CHAIR: At the hazard of repeating myself, I appreciate the Australia Council did come good on that, so I appreciate that and I appreciate your assistance, Minister. I hope we will see both of you at the 25th anniversary celebrations in a couple of weeks time. Anyhow, I think that is a good model and I am pleased to hear of it. That is probably all the questions I have on that particular aspect of the arts. Senator O'Sullivan, did you want to use my two minutes?

Senator O'SULLIVAN: Very generous of you, Chair. This is directed to no-one in particular. Can you confirm how much the government has committed to the Bell Shakespeare school education program? Is someone able to help me with that?

Senator Brandis: Yes, I can. This, by the way, is not funding either through the Australia Council or the National Program for Excellence in the Arts which, of course, does not start until 1 July. This was allocated from some funds that we had available in the ministry. We announced yesterday that the government is contributing $1.2 million by way of a grant to Bell Shakespeare to promote theatre education—with a particular focus on Shakespeare, but theatre education generally—in schools. This is work that Bell Shakespeare has done, particularly in New South Wales, for many years. We should be, Senator O'Sullivan, extremely proud to have such a world-class theatre company in Australia as Bell Shakespeare. They do not just do Shakespeare, but Shakespeare is the core of their repertoire. John Bell is a very great Australian and a very great figure in the cultural landscape of this nation. This year is the 25th anniversary, in fact, of Bell Shakespeare. One of the great things they do is an outreach program to schools to encourage kids, particularly primary-school kids, in the love of theatre and the love of performance. I said it was $1.2 million; it is actually $1.28 million, which I announced yesterday. It is a marvellous program. Thank you for asking about it.

Senator O'SULLIVAN: I was very interested in taking this out to the schools. Can we anticipate that this will make its way into some of the more remote and regional areas of the country to give the youngsters an opportunity in this space?

Senator Brandis: The more that arts companies reach out to schools, and particularly primary schools, so that we encourage enthusiasm in younger children, the better. But of course there are limits to how much they can do, because of their size and scale. This is the very sort of program that I am eager to build.

Senator O'SULLIVAN: Excellent. You should be congratulated. Is that an indication that my little bit of time is over?

CHAIR: Yes, it is, but I will come back to you later. In passing back to Senator Collins, I note that 25 years ago seems to have been a time of great things happening: Bell Shakespeare started, the Australian Festival of—

Senator Brandis: And you started!

CHAIR: And I started, yes.

Senator Brandis: I remember you defeated me in that preselection, Senator Macdonald, all those years ago.

Senator JACINTA COLLINS: We learn new things every day. Senator O'Sullivan, I also noticed the Bell Shakespeare announcement. Senator Brandis sometimes refers to the fact he believes I do not get out often enough; I have been to many Bell Shakespeare productions over the years. It does lead to a different issue which is that, aside from this new fund and aside from the Australia Council, what are the funds available within the ministry for other programs or activities?

Ms Basser : We manage a range of different programs. They include the Australian Government International Insurance Scheme and the National Collecting Institutions Touring and Outreach Program. We manage the National Cultural Heritage Account. We administer the contracts for the elite arts training schools—the Australian Ballet School, the Australian National Academy of Music, the Australian Youth Orchestra, the Flying Fruit Fly Circus, the national Aboriginal and Islander dance school, the National Institute of Circus Arts, the National Institute of Dramatic Arts and the ArtsReady program. We deliver the Anzac Centenary Arts and Culture Fund. We deliver the Regional Arts Fund. We deliver the Indigenous arts and languages program. We manage the contracts for AusFilm and the Australian Children's Television Foundation. We also deliver the Public Lending Right program and the Educational Lending Right program.

Senator JACINTA COLLINS: In terms of the amount of funding available for the arts community, rather than administration and departmental functions, can you break up for me roughly what sits with the Australia Council, what sits in this new fund and what sits with the other programs you just outlined?

Ms Basser : I would have to take that on notice to give it to you exactly. Broadly, I think, after the split, a part of our administered budget includes $71 million that is part of Screen Australia's appropriation. So if I deduct that, it is about $150 million. So we will have about $150 million and the Australia Council will have $184 million.

Senator JACINTA COLLINS: So does the $150 million include the new fund?

Ms Basser : That is right, it does.

Senator JACINTA COLLINS: What proportion of the $150 million is the new fund?

Ms Basser : It is about $22 million out of the $150 million.

Senator JACINTA COLLINS: So the ministry funds have essentially been topped up by about 15 per cent by this new fund?

Ms Basser : About 12 to 15 per cent, yes.

Senator JACINTA COLLINS: And is the $184 million figure you just gave me post the 12 per cent cut?

Mr Grybowski : That is correct, $184.5 million.

Senator JACINTA COLLINS: I might go back to the issues around timing. I understand the potential impact of these new arrangements on the funding streams available to organisations. From the Australia Council's point of view, have you cancelled a funding round?

Mr Grybowski : Yes we have. We had a funding round closing on the first week of June. We have cancelled that round. To clarify, we have not cancelled the overall grant round, just that particular round.

Senator JACINTA COLLINS: Okay, so how many organisations would have been anticipating that round?

Mr Grybowski : We publish the round with four closing dates in a year and we have just cancelled the one in June, pending knowledge and information about the new program so that we can plan and ensure that our future programs are complementary to the new program.

Senator JACINTA COLLINS: So if you do not see the guidelines and arrangements for the new program until end of June, how would that impact on the next round?

Mr Grybowski : The next round is in September. We wrote to those applicants who had already submitted to the June round to say that they would be considered in the September round.

Senator Brandis: And those guidelines will be published. As I say, we propose to open the round on 1 July, so they will be published in a few weeks. The Australia Council will be well aware of what the guidelines are well before September.

Senator JACINTA COLLINS: What I am trying to gauge from the Australian Council is what the impact will be of this one funding round that will not occur for the organisation that rely on the street a funding?

Mr Grybowski : It is it too early to determine until the new round is actually opened.

Senator JACINTA COLLINS: So you cannot determine what the impact will be until September?

Mr Grybowski : That is correct.

Senator JACINTA COLLINS: What would have ordinarily occurred in this funding round that was cancelled?

Mr Grybowski : It is one of four funding rounds. It is part of the new simplified grant program that we promoted from August last year. It is offered four times a year across all art forms, disciplines and practices. The June one has been cancelled and it will be recommenced in September once we have reviewed the new program and made any modifications that we need to to ensure that the program is complementary.

Senator JACINTA COLLINS: But, for example, are there any organisations that would have been relying on the June round to continue their operations?

Mr Grybowski : It is not operational funding; it is project funding. So it is for projects to be delivered in the next one two or three years. But it is not operational funding. I should also mention that, in the announcements that we put out post the budget, we confirmed the contractual arrangements that we had with our 148 small to medium arts organisations until the end of 2016. But, again, we suspended what we had advertised as the six-year funding model, pending information and knowledge about the new programs.

Senator JACINTA COLLINS: I will come to the 16-year funding model a bit later. Can you tell me then, for comparison's sake, the third funding round—what projects were funded under that?

Mr Grybowski : Sorry?

Senator JACINTA COLLINS: You have four rounds.

Mr Grybowski : Yes.

Senator JACINTA COLLINS: You have cancelled one of them.

Mr Grybowski : Yes.

Senator JACINTA COLLINS: The third round.

Mr Grybowski : The third round?

Senator JACINTA COLLINS: The round before—what projects were funded under that?

Mr Grybowski : What projects were funded? The first round closed in March, and we are about to announce the successful recipients in those rounds; we are advising the applicants later this week.

Senator JACINTA COLLINS: You might need to back around then. Give me an example of what was funded under the round ahead of that.

Mr Grybowski : I might ask our executive of the arts funding area, Frank Panucci, to provide some details on that answer.

Mr Panucci : The round before that was under the old grants model, so it is difficult to give a comparison; but in the first round in March we had just on 2,500 applicants across the three different streams.

Senator JACINTA COLLINS: And what sorts of projects were successful?

Mr Panucci : We have not made the formal announcements, because we have just finished the assessment process.

Senator JACINTA COLLINS: We are in the wrong round here. I asked you to go around to earlier. I am not asking you to talk about what has not yet been announced. I am trying to understand what occurred in the round ahead of that.

Mr Panucci : We estimate our success rate will be roughly as it always has been at the Australia Council—it is a very competitive environment—between 15 and 20 per cent.

Senator JACINTA COLLINS: That is not my question either.

Mr Panucci : Senator, perhaps I can answer. Primarily it is for the creation and distribution of work. So it is for the creation of art and literature; the composition of music. It could be tours or presentations or performances—those types of things. There are many of hundreds and thousands. I could take it on notice and give you some specific examples. All the grants that we award are actually on our website with the name of the recipient and a very short description of the project summary.

Senator JACINTA COLLINS: Correct me if I am wrong in my understanding, but in the round that Mr Panucci mentioned there were 2,500 applicants, and between 15 and 20 per cent of those are successful. It is about the creation and distribution of work. Presumably there are a fair degree of new artists?

Mr Grybowski : Yes. It is a mixture.

Senator JACINTA COLLINS: Young and emerging artists?

Mr Grybowski : It is a mix right across the gamut.

Senator JACINTA COLLINS: And you will not be in the position to gauge the impact until September—the impact of one of those rounds not occurring?

Mr Grybowski : In completeness, until the end of the financial year when we do our annual report.

Senator JACINTA COLLINS: But, in terms of promoting the creation and distribution of work, there will be a hiccup in the available assistance to work for that purpose?

Mr Grybowski : There will be a delay. But those artists will be able to apply to the September round.

Senator Brandis: Of course they will also be able to apply to the new program as well. I think we need to remember here that the amount of money available in grant funding is the same. Twelve per cent of it will be administered through the new program and 88 per cent of it will be administered through the Australia Council, but the amount of money will be the same.

Senator JACINTA COLLINS: As long as in terms of the new program they fit into one of three streams?

Senator Brandis: Yes, but those streams have been designed to be pretty flexible.

Senator JACINTA COLLINS: We will come to that in a moment. I was asking questions earlier about the new criteria—and you are not in a position to elaborate to a fair degree at the moment. Can I ask, though: will peer review be retained as a component for those funds?

Ms Basser : Senator, within the ministry we have a range of different ways of assessing grants. Some are done by the professional officials who work within the ministry. Others, such as the Anzac arts and culture fund, have a creative advisory committee. Previously when we managed the touring programs we had professional assessment. At this stage, as I said, we are not settled on whether there are areas of the new program that may have professional assessment or not.

Senator JACINTA COLLINS: So at the moment the answer is: 'I don't know'.

Ms Basser : At the moment, as I have said, we are working through developing the guidelines.

Senator JACINTA COLLINS: Will you be giving consideration to what duplication these processes may involve if people have access to two separate funding pools?

Ms Basser : Our aim is absolutely to minimise any red tape and certainly any duplication. As I said to you earlier, we met yesterday with the Australia Council and we will continue to work with them very closely so that we are ensuring that our application procedures and all the elements are as simple as possible, and also that we are not duplicating between us.

Senator JACINTA COLLINS: The issue here—and possibly the minister and I could debate this forever and a day, but I do not want to take the time on that today.

CHAIR: You do not debate here; you ask questions.

Senator JACINTA COLLINS: The minister was referring to debates earlier, so you will need to catch him on it.

CHAIR: The minister was wrong.

Senator Brandis: I was referring in the course of an answer to the fact that there had been debates. I was not engaging in a debate.

CHAIR: Anyhow, let's not debate debates. You have only got 54 seconds left, Senator Collins.

Senator JACINTA COLLINS: Again, I do not have much time. The minister uses language like 'contestability' and 'monopoly'; it is hard to envisage how that approach to the arts will deal with potential duplication or further layers of red tape—by the operations of these two funds. The minister assures us that, if people cannot succeed in one, they can go to the other.

Ms Basser : It has always been the case historically that programs have been delivered through the ministry, in its various names and iterations through the decades, and the Australia Council. My view is that the arts sector is quite used to dealing with different programs through both organisations.

Senator Brandis: Also, do not forget, Senator Collins, these self-same organisations very often apply to state and territory arts departments through their program funding as well. I am advised that in none of the states and territories is there the peer review system that the Australia Council runs; both Labor states and Liberal states have the model that we have introduced in this budget.

Senator JACINTA COLLINS: I am not sure they have quite the same model.

Senator Brandis: Not exactly the same, but not through the Australia Council model.

CHAIR: Senator Collins, we might leave it there and pass to Senator O'Sullivan, and then Senator Ludlam after that.

Senator Brandis: Sorry, I meant to say 'arm's length' rather than 'peer review' in that last observation.

Senator O'SULLIVAN: Thank you, Chair. I had not quite finished with my questions in relation to the Shakespeare school education program, which is of great interest to those of us who like to support young education. Minister, a question perhaps for you: that extension of funding, what does that mean? How long will that nourish the program for? Does it give an extension in terms of its capacity to run?

Senator Brandis: It is a four-year program. It is $1.28 million over four years. This is an existing program and it had previously been funded in part through the Department of Education. It is now being funded entirely through the Ministry for the Arts and it will enable the program to run until 2019. The funding is for a range of activities, including: a resident artist in education; student masterclasses, which is what I was talking about before; subsidised tickets for young people; the development of digital and online resources; regional teacher forums to encourage and instruct teachers in theatrical education; and a mentorship program. I can give you a little more information if you are interested as to the way each program is run.

Senator O'SULLIVAN: Do you have any statistical background about, for example, how many students might have had the benefit of accessing the program?

Senator Brandis: Yes, I do. This program has been running since 2008 through Bell Shakespeare. Since that time, it has enabled Bell Shakespeare to deliver 569 student masterclasses to 19,152 students, at 413 regional schools across Australia.

Senator O'SULLIVAN: That is impressive.

Senator Brandis: It has enabled Bell Shakespeare to invite 4,009 disadvantaged students to see a Bell Shakespeare production at either the Sydney Opera House or the Melbourne Arts Centre. It provided in-depth training, mentorship and support for 120 teachers. And it has reached more than 80,000 teachers and students, face to face, in every state and territory, and more than 75,000 through online platforms annually.

The learning program provides a range of benefits for students and teachers—including, so far as concerns the benefits for the students: significantly increased innovation, higher self-expression and creativity, improved attitudes towards English, increased school attendance, and decreased anger levels in the classroom. For teachers, it has provided greater skill in teaching the classics and drama. This funding ensures that the program reaches about 90 per cent of Australian electorates, targeting regional, remote and disadvantaged Australian schools.

I am a passionate supporter of this program, as I hope is obvious. The genius of it is this: it applies to drama and education; it also applies to music and dance education. We know as parents—and I think you are a grandparent yourself, Senator O'Sullivan—that young children are very unselfconscious; they are very mobile; they like to run around; they like a lot of physical activity. They are unselfconscious. Capturing the imaginations and the minds of five-, six-, seven-, eight-, nine-year-olds with drama, in putting on a performance, is an easy thing to do. But, if it is structured in a particular way, you can do that and at the same time you can plant the seed of love of theatre and drama and language.

When kids are a bit older, at secondary school, when they are teenagers, they are more self-conscious and a little less receptive to that. So the genius of this program is that it captures children who are naturally exuberant and exhibitionist, and build on that natural exhibitionism to inculcate a love of performance art.

Senator O'SULLIVAN: I think this is one of the terrific good news stories coming out of our exchanges this morning. Obviously there is a demand for this program in the community; that is reflected in the delivery. In terms of the funding there seems to be a very big bang for our buck—not making light of the funding in the form of millions—but does it enjoy funding support elsewhere, for example, corporate support?

Senator Brandis: For this particular program I actually do not know the answer to that. Bell Shakespeare is one of the major performing arts companies that are funded through the Australia Council. So this is in addition to the program funding it receives for its regular activities. Whether there is a particular corporate sponsor for this program—let me take some advice here. Yes, I can give you a little more information about that. I am told that to deliver this program to regional, remote and metropolitan areas actually costs Bell Shakespeare $2.4 million every year. Our funding—which is $320,000 per annum, or $1.28 million over the four years—will leverage at least $800,000 in philanthropic and corporate support. And who those corporate, philanthropists and supporters are I cannot tell you.

Of course, this is one of the core objectives of this government's arts policy, to make targeted investments in arts companies and leverage from those targeted investments of public money even greater investments of private money and corporate sponsorship. I think that particularly the major performing arts companies do this particularly well. Bell Shakespeare, of course, has a magnificent reputation. It is one of the glories of the Australian cultural sector.

Senator O'SULLIVAN: If I hear any of my 10 grandchildren running around citing Shakespeare, I will report back to the committee an extension of what is clearly a successful program, so I thank you for that. That is a really good news story.

Senator LUDLAM: Minister, I might start with you. Do you have concerns, or have you had concerns, about the independence and conduct of the Australia Council; and do you want to describe those for us, if that is the case?

Senator Brandis: No, I do not have concerns about the independence of the Australia Council. The Australia Council has a statutory independence in its grant-making process. In relation to the conduct of the Australia Council, I do not have any concerns about the way in which the Australia Council conducts itself, no.

Senator LUDLAM: Do you want to share any criticisms of particular decisions? If we are clear on independence and we are clear on conduct, do you have particular concerns about individual decisions that they have made or some of the particular work that they have funded?

Senator Brandis: The honest answer to your question is: yes. That being said, I think it would be quite invidious and wrong for me as the minister to critique particular decisions, because I am not involved in that decision-making process and I do not question the integrity or the regularity of the decision-making process. Those of us who read Tim Blair in the Daily Telegraph or watch Andrew Bolt's marvellous program on Channel 10 have noticed some of the teasing remarks they have made in recent days about certain decisions. But I think it would be quite wrong of me as the minister to single out individual decisions for criticism, because all I really think I should speak to is the process.

Senator LUDLAM: Alright, that is reasonable. It will not surprise you to know that I am not a huge viewer of Bolt's show, so I will leave some of that individual—

Senator Brandis: I think Mr Bolt is a careful watcher of you, Senator Ludlam.

Senator LUDLAM: I understand that. It is creepy, isn't it; but nonetheless.

Senator Brandis: No, it is called a liberal democracy—get used to it.

Senator LUDLAM: Are those individual decisions, which I think it is probably reasonable that you do not want to share with us now, part of your rationale or reasoning behind establishing this new body?

Senator Brandis: No, it is not. What I have tried to do is to bring more contestability and flexibility into the process. I think you were here, but perhaps you were not listening when I read out what Mr Barry Cohen had to say as long ago as 30 years ago, and I—

Senator LUDLAM: Yes, you found someone from 1985 who thinks it is a good idea. I was listening.

Senator Brandis: Senator, you are an educated man. You know these debates go back to Aristophanes. These debates have been going for as long as the performing arts have been performed. The fact that this debate was present 30 years ago—it was present 300 years ago. It has been present throughout cultural history—

Senator LUDLAM: If you can find us a Greek philosopher—

Senator Brandis: As an educated man, you let yourself down you say ignorant things. The point I was trying to make is this: there are those who take a purist view that arts funding should only be provided through the Australia Council model. There are those who take the opposite view, which is rather closer to Senator Macdonald's observations a little earlier, that all public spending should ultimately be taken responsibility for by a minister who is answerable to the parliament and the public. I think there is a lot to be said for both of those views.

What we have done is sought to accommodate both of those principles—the, shall we say, expert principle, and the democratic principle—by having a funding stream which represents about 12.3 per cent, I think, of the Australia Council's budget, which has been diverted to the National Program for Excellence in the Arts, so that both of those sets of values (the expert peer reviewed funding principle and the public accountability principle) are accommodated in the funding mix.

Senator LUDLAM: If it is about public accountability or ministerial accountability, in what manner do you propose to interpose yourself and your views into these decisions?

Senator Brandis: Well, I do not. As I have said to others who have asked me about this, I am not the assessor.

Senator LUDLAM: In what way are you taking responsibility for these funding decisions then?

Senator Brandis: I take responsibility for everything that is done by my department.

Senator LUDLAM: You cannot tell us yet how the department is going to be making the decisions or what the criteria is going to be?

Senator Brandis: Perhaps you were not listening.

Senator LUDLAM: I was listening; I have been here as long as you have.

Senator Brandis: I said perhaps you were not listening. You have been a decorative presence with us throughout the morning. Ms Basser has been asked that question by Senator Collins and she has answered it.

Senator LUDLAM: So you have no criteria, you are not proposing to—?

Senator Brandis: No, that is not right. We do have criteria and Ms Basser has told you what those criteria are—

Senator LUDLAM: You have told us that there are three streams.

Senator Brandis: and she has also told you that the guidelines are in development and will be published shortly.

Senator LUDLAM: What is it going to cost the Public Service to administer this new funding stream or these three funding streams?

Ms Basser : As part of the transfer of the funding, the ministry will be having additional staff of eight full-time equivalents. But I would just like to note that since 2010, we have reduced by 80 full-time equivalent staff—so it is a minimal increase.

Senator LUDLAM: What is that roughly worth?

Ms Basser : I think it is about $1 million in overhead for eight staff.

Senator LUDLAM: So our red-tape reducing, public service sacking government is introducing a new bureaucracy, which will draw about a million bucks. Is that over the forward estimates or just annually?

CHAIR: That is not a fair question.

Ms Basser : Can I just also note that it is actually balanced out that the Australia Council in the PBS loses 10 FTE, so in actual fact if you look at arts administrators, it is actually a net loss in the PBS of two FTE.

Senator O'SULLIVAN: An unfortunate answer.

Senator LUDLAM: Yet, you still manage to sack people, Senator O'Sullivan—all is well. What formal legislative status will this centre have? Will you legislate for its existence?

Senator Brandis: No, it is a program within the ministry.

Senator LUDLAM: Within the department?

Senator Brandis: And subject to the guidelines that Ms Basser referred to before.

Senator LUDLAM: I think that you have made it reasonably clear that the Australia Council found out, I think, on budget day, you put a call through. What consultation did you have with other arts sector entities before embarking on this change?

Senator Brandis: I speak to various art sector 'entities', to use your word, all the time. Whether they be government entities or, more importantly, arts companies and arts practitioners, I speak to them all the time.

Senator LUDLAM: I guess we would expect that. Have you or your chief of staff, or any of your senior staff, met with major performing arts companies and made any kinds of commitments around excellence funding?

Senator Brandis: No.

Senator LUDLAM: Have you met with the major performing arts companies? Could you give us a review of who knew in advance that you were about to make this change.

Senator Brandis: This was a policy that I took to the Expenditure Review Committee of Cabinet in the course of the preparation of the 2015-16 budget. The Prime Minister and the members of the Expenditure Review Committee of Cabinet and the senior officials who sit on that committee, by agreeing to this measure, adopted this policy.

Senator LUDLAM: That is your internal cabinet process, the ERC process. My question was: who within the arts community knew in advance that this proposal was on the cards?

Senator Brandis: If what you are really getting at is: were there some within the arts community who knew about this in advance and others who did not, specifically—that is not the way budget processes work. The way budget processes work is that the line minister develops new policy proposals—or NPPs, as we call them—and takes them to the ERC. They are debated there from both a policy merits and also a fiscal impact point of view. This particular proposal had no fiscal impact because it was fully offset from funds that were previously with the Australia Council, and I did Mr Myer, the chair of the Australia Council, the courtesy of letting him know late on the afternoon of budget day what we had it in mind to do, because obviously his agency was directly affected by it.

Senator LUDLAM: I do not want to verbal you, but is it the case then that nobody within the arts community had any warning at all—that you have not consulted even a little bit about this proposal?

Senator Brandis: I am sorry, you are conflating two different things.

Senator LUDLAM: I asked you whether you had let anybody in the arts community know in advance, and you have walked me through, in some detail, your ERC process instead.

Senator Brandis: If you would let me answer your question—because you are conflating two different things. You are conflating consultation with notice. It would not be appropriate for any minister to let stakeholders in advance of a new measure being announced in the budget know the detail of that measure. As I said to you before, as a matter of courtesy I told Mr Myer on the basis of his assurance that he would keep the information embargoed until 7:30 pm. I thought that, as a matter of courtesy, I ought to do that. But, subject to that one exception, it would have been quite wrong of me to give some stakeholders, as it were, inside knowledge of an upcoming budget decision, so of course I did not do that. In relation to consultation, as I said in answer to your earlier question, I speak to the sector all the time. I know what their complaints are, I know what their grievances are, I hear their criticisms of the Australia Council. I speak to the Australia Council, I understand the Australia Council's view of its own role and its rejoinder to those criticisms. If you are engaged in the sector it is hard to have a discussion about arts funding without sooner or later somebody having a whinge to you about the Australia Council. That does not mean I agree with what they say, but I am powerfully persuaded that the Australia Council should not be the monopoly provider of Commonwealth arts funding.

Senator LUDLAM: I understand the rationale. I still do not feel like you have directly engaged with my question. I understand that you consult with and you hear views and you speak widely with people in the arts community. Did anybody know that you were intending to announce a contestable fund separate from the Australia Council?

Senator Brandis: I cannot do better than my previous answer. Nobody other than Mr Rupert Myer, whom I called as a matter of courtesy about two hours or so before the budget speech, was told of the specific measure in advance, nor should they have been.

Senator LUDLAM: This must be one of the only measures in the budget that was not dropped to press organisations in advance of budget night.

Senator Brandis: I do not know that any budget measures were, as you so elegantly put it, 'dropped' to press organisations.

Senator LUDLAM: There had been some very serious national security leaks in that case on the morning of the budget, that all of the newspapers carried.

Senator Brandis: I saw because I do read the newspapers.

Senator LUDLAM: Will you be prosecuting those—

CHAIR: Have you got a question?

Senator Brandis: I did see stories speculating about what would be in the budget. That is commonly the case. But as to the way in which those stories found their way into the newspapers I do not know and I cannot speak about it. I think there may have been some actual formal pre-announcements in some areas of social policy, to the best of my recollection. But those were obviously decisions made by the minister in consultation with the Prime Minister to, as it were, announce decisions before the budget as standardised policy measures.

Senator LUDLAM: I have only a couple of minutes left. Could I just put a quick question or two to Screen Australia?

CHAIR: We can come back to you, Senator Ludlam.

Senator LUDLAM: I am jumping between committees; I will just be quick.