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Legal and Constitutional Affairs Legislation Committee
28/05/2015
Estimates
ATTORNEY-GENERAL'S PORTFOLIO
Family Court and Federal Circuit Court

Family Court and Federal Circuit Court

[14:19]

Senator JACINTA COLLINS: Attorney, I apologise for missing your announcement in relation to Rob McClelland. It relates to the questions that I was about to ask.

Senator Brandis: I did not mean to take the wind out of your sails, Senator Collins.

Senator JACINTA COLLINS: It has not taken the wind out of my sails; I was just hoping that it was not the announcement you were foreshadowing when we were in the arts.

Senator Brandis: It was, because some who did not listen to my words carefully assumed that I was talking about the arts, whereas, in fact, what I carefully said was, 'within my portfolio'. So that is the same announcement that I foreshadowed yesterday.

Senator JACINTA COLLINS: As you are aware, I have learnt over time. I do listen to your words very carefully, so I was clarifying that point.

Justice Fowler retired on 14 November 2013. We now have the retirement of Justice Bell on 27 February this year. Is it the government's intention to appoint a replacement for Justice Bell?

Senator Brandis: Yes.

Senator JACINTA COLLINS: Do you anticipate that it will take as long as the replacement for Justice Fowler?

Senator Brandis: No.

Senator JACINTA COLLINS: Has a selection process commenced?

Senator Brandis: Yes.

Senator JACINTA COLLINS: Have any Family Court judges been appointed in the current period of government?

Senator Brandis: Yes. Mr Justice McClelland was appointed this morning.

Senator JACINTA COLLINS: Sorry—this is for the Family Court. What is the situation with the Federal Circuit Court?

Senator Brandis: You would have to be a bit more specific.

Senator JACINTA COLLINS: What is the situation with appointments and retirements?

Senator Brandis: A number of judges were appointed to the Federal Circuit Court earlier in the year in both Sydney—principally in Sydney—and also in Brisbane. At the moment, we are progressing further appointments in Sydney, in Newcastle and in Darwin.

Senator JACINTA COLLINS: Does that leave the Federal Circuit Court with a full complement of judges?

Senator Brandis: I will have to defer to Mr Foster about that. There are quite a few retirements imminent, and there will be more judges appointed, obviously, to replace them. I cannot guarantee that those vacancies created by retirements will not result in a period when in the court is not at its full complement. Obviously, it is our objective to keep it at its full complement, as close as is practicable.

Senator JACINTA COLLINS: You will not be looking at a time period, for instance, that applied in the case of Justice Fowler in the Family Court?

Senator Brandis: No. That was unusual, I must confess. I had identified his replacement some time ago, as a matter of fact, and discussed the appointment of Robert McClelland with Chief Justice Bryant quite some time ago, but there were various reasons that I do not particularly feel the need to go into as to why the appointment was not made until now.

Senator JACINTA COLLINS: Okay; I am not going to press that issue. But there have been concerns—

Senator Brandis: I am sorry; let me give you one extra piece of information. I first raised this with Mr McClelland—I think it would have been about August last year.

Senator JACINTA COLLINS: I anticipated something similar, which was why I was not going to press the issue. A very fine appointment. I understand in the Family Court there have been complaints—indeed I think one judge apologised to a litigant for delay due to workload. With this appointment now, do we envisage those problems will dissipate?

Mr Foster : Yes, that will alleviate that position largely. We will have the full complement of judicial numbers—that is, 33 judges in the Family Court—when the Brisbane appointment is made. But there are always issues with sickness and leave and moving resources around which can affect delays across country because the workload in both the Family Court and the Federal Circuit Court, as you would be aware, is quite demanding. So I cannot give you a watertight guarantee that it would overcome a problem from time to time, but the court would be resourced to its normal capacity.

Senator JACINTA COLLINS: As the Attorney indicated, we are not looking at a similar delay with respect to a replacement for Justice Bell, so hopefully some of these concerning statistics will not continue.

Mr Foster : Yes. We would like to think so.

Senator JACINTA COLLINS: What percentage of litigants appearing in the Family Court and the Federal Circuit Court are unrepresented?

Mr Foster : It is a bit of a moving target and it can vary depending on what stage the process is up to, but it is around about just under 50 per cent, at some stage in the process, that someone is self-represented.

Senator JACINTA COLLINS: Fifty per cent at some stage?

Mr Foster : At some stage—because people buy advice in for particular events and then come on their own. It just varies a little bit. If you ask the question about how many people are self-represented from go to whoa, that is a very different question than one about how many people are self-represented.

Senator JACINTA COLLINS: I understand that, so I am going to ask you that next question.

Mr Foster : I would like to take that on notice if I could.

Senator JACINTA COLLINS: Because, as you say—

Mr Foster : It is a moving target.

Senator JACINTA COLLINS: It is going to depend on the nature of the matters too, presumably.

Mr Foster : Exactly.

Senator JACINTA COLLINS: If you could provide me with that, that would be useful. What percentage of litigants appearing in the Family Court and the Federal Circuit Court are legally aided?

Mr Foster : I would have no idea off the top of my head.

Senator JACINTA COLLINS: Are these matters that would generally be reported in annual reports or the like or not?

Mr Foster : No. We do not report about how many are represented by Legal Aid. I will take that on notice. I am not even sure that I can provide the answer, but I will do whatever I can to find out.

Senator JACINTA COLLINS: It may be something that we need to broach from a different end.

Mr Foster : A different end—that is right.

Senator JACINTA COLLINS: But, to the extent that you are able to inform, that would be useful.

Mr Foster : If we can assist the committee, we will.

Senator JACINTA COLLINS: Is the percentage of unrepresented litigants that appear in the Family Court and the Federal Circuit Court increasing?

Mr Foster : My experience is that it is not. It seems to have plateaued pretty much. As I said, it is around about a bit less than 50 per cent who are self-represented at some stage during the process. As accurate as our data is in this matter, it does not seem to be the case.

Senator JACINTA COLLINS: Are you able to break down what proportion of those unrepresented cases involved children?

Mr Foster : Some matters are both children and property, but again I can take that on notice, and we do have detailed statistics and we should be able to provide information for you. I do not have it with me; that is all.

Senator JACINTA COLLINS: I understand that the number of cases involving children generally is at about 47 per cent, but I am curious as to what proportion of those are self-representation in that space as well.

Mr Foster : Sure.

Senator JACINTA COLLINS: Can you tell me what proportion involve family violence?

Mr Foster : No, I cannot tell you that.

Senator JACINTA COLLINS: Okay. Did I get a figure earlier about how many judges sit on the Family Court?

Mr Foster : There are 24.5 who sit in first-instance work. The 0.5 is the Deputy Chief Justice, who also sits in the appellate jurisdiction. There are 7.5 in the appellate jurisdiction, for a total of 32, and that number includes the soon-to-be-sworn-in Justice McClelland.

Senator JACINTA COLLINS: Do you have any trend information on workload?

Mr Foster : Yes, I do. Workload over the last probably three to four years, in terms of final applications for both courts, has basically stabilised. I can give you a breakdown of filings over the last three or four years in both the Federal Circuit Court and the Family Court for final order applications, which is the mainstay of our work.

Senator JACINTA COLLINS: Yes.

Mr Foster : In 2010-11, in the Family Court it was 3,249 and in the Federal Circuit Court it was 17,515, for a total of 19,426. In 2011-12, it was 3,271 in the Family Court and 17,412 in the Federal Circuit Court, for a total of 19,326. In 2012-13, it was 2,807 in the Family Court and 17,364 in the Federal Circuit Court, for a total of 18,999. In 2013-14, it was 2,923 in the Family Court and 17,565 in the Federal Circuit Court, for a total of 19,279. Projected figures for 2014-15 are 2,950 in the Family Court and 17,650 in the Federal Circuit Court, for a total of 19,400. So it has been running around 19,000 to 19,500 now for the last three or four years. So it seems as if the workload has basically plateaued.

Senator JACINTA COLLINS: The interesting thing about those statistics is that they suggest a shift in the Family Court in 2012-13, which has been sustained, which took the cases down below the 3,000 mark. Is there something in particular you would attribute that to?

Mr Foster : Not necessarily. I think it depends on where a particular registry has a number of judges. There is a protocol between the two courts which works out where it is most practical or suitable for you to apply. But it has largely settled down to a figure now where the Family Court has about 14 per cent of filings and the Federal Circuit Court has 86 per cent, in applications for final orders.

Senator JACINTA COLLINS: But you suggest that, because of potentially different locations and appointments over time—

Mr Foster : Different factors can affect it, yes.

Senator JACINTA COLLINS: the more meaningful trend is the total, rather than a particular court?

Mr Foster : That is right. I think so, yes.

Senator JACINTA COLLINS: Have you done any assessment of the impact of court delays on litigants?

Mr Foster : No, we have not done any research on the impact of delay on litigants.

Senator JACINTA COLLINS: Are you aware of any?

Mr Foster : The timeliness to trial is one way of measuring delay—and there are very many different ways to measure trial. In the Family Court, in the nine months year to date, as at the end of March, the average or mean time from lodgement to first day of trial is 12.9 months. In the previous period it was 13.4 months. And in the Federal Circuit Court, Mr Agnew?

Mr Agnew : Seven point four months.

Senator JACINTA COLLINS: Sorry; I am more it interested in the impact on litigants, so understanding what the impact of those delays is.

Mr Foster : The impact is obviously pretty significant if the delays are excessive.

Senator JACINTA COLLINS: What is significant is if a judge is apologising to litigants because of what they see as the impact, so—

Mr Foster : I do not know if that is standard. That might be an exception rather than a rule, I think.

Senator JACINTA COLLINS: An aberration?

Mr Foster : I think it might be, yes.

Senator JACINTA COLLINS: Could you provide me with the details of the new fee structure?

Mr Foster : I think that might be a question best answered by the department.

Mr Fredericks : My understanding is that that fee is still before government. I think the final step in the process is for it to be made as a regulation and published on the Federal Register of Legislative Instruments, and that has yet to occur. That fee structure, as will be given effect to in a legislative instrument, is still before government, is not yet a public instrument and will not be until it is lodged on the Federal Register of Legislative Instruments.

Senator JACINTA COLLINS: How much can you tell me by virtue of what was reported in the budget?

Mr Fredericks : We can certainly tell you the aggregate revenue that is raised by the fee increase because that is reported in the budget. I refer you to Budget Paper No. 2 at page 66 where it is recorded that the aggregate revenue raised by that budget measure is $20.4 million in 2015-16, $21.5 million in 2016-17, $21.9 million in 2017-18 and $23.6 million in 2018-19.

Senator JACINTA COLLINS: Unfortunately there is a shortage of Budget Paper No. 2 at the moment. We have only been made available two copies for our member and senator offices, which means one returns to our electorate office and one is available in parliament—it seems the secretariat is suffering a similar fate. I will move on for now but I may come back to what else might be available in terms of the budget reporting . How much of the additional revenue collected through court fee increases in the Family Court and the Federal Circuit Court will be put into the resourcing of those courts ?

Mr Foster : It is $21 million over the forward estimates—$5.5 million in 2015-16, $4.1 million in 2016-17, $5.1 million in 2017-18 and $6.2 million in 2018-19. It is a pretty significant injection of money into the system.

Senator JACINTA COLLINS: It is but where is the rest going?

Mr Foster : I am only looking at it from the Family Court and the Federal Circuit Court so we are very happy to take the cash.

Senator JACINTA COLLINS: Except that you will be left with dealing with the litigants who are paying the higher fees too.

Mr Foster : We are an agent of the Department of Finance, we just collect the fees. It is a matter for the government to set their fees, we do whatever we can to collect them.

Senator JACINTA COLLINS: I have a figure of the government raising $87.4 million in additional revenue from higher court fees but only spending $52 million of that on the courts. The figures you just gave me are well below—they were the $21 million weren't they?

Mr Foster : Yes.

Senator JACINTA COLLINS: What would the remainder of that $52 million—

Mr Foster : I think $30 million went into the Department of Finance for property costs and upgrading court facilities et cetera—that is my understanding.

Senator JACINTA COLLINS: Okay so there is the capital element as well.

Mr Foster : Yes so that is the balancing factor of the $52 million.

Senator JACINTA COLLINS: How will the remaining $35 million in revenue be spent?

Mr Fredericks : That money is returned to consolidated revenue.

Senator JACINTA COLLINS: The Attorney-General needed to take funds from the Australia Council and he needed to donate $35 million back to consolidated revenue in this last budget round—is that how it worked?

Senator Brandis: The way it generally works, and I tried to explain this to you yesterday—

Senator JACINTA COLLINS: But you were telling me yesterday that you were a winner, that does not look like being a winner.

Senator Brandis: That is just not the way our government looks at these things. We are concerned to manage the public finances prudently because there is not a dollar that the government has that the government owns—everything comes from taxpayers.

Senator WRIGHT: Or court-fee payers.

Senator Brandis: They are taxpayers too.

Senator WRIGHT: They may not necessarily be but they are court-fee payers.

Senator Brandis: The budget rule is that there be no additional expenditures without offsets—so in relation to the National Program for Excellence in the Arts, which we discussed yesterday, that was offset from the Australia Council. But, of course, our overall objective is to repair the budget catastrophe you left us with, which had public debt projected to peak at $667 billion. We regard it as a good thing, not a bad thing, if we can manage any department or agency in a way that returns money to the budget.

Senator JACINTA COLLINS: There is not some other measure for which this was an offset?

Mr Foster : Not as far as I am concerned.

Senator Brandis: I think the measure of which you are now speaking was returned to the budget.

Senator JACINTA COLLINS: Mr Fredericks indicated that he understood that it was going into consolidated revenue.

Senator Brandis: That is what I mean when I say 'returned to the budget'.

Mr Fredericks : The way to think about that is: it is true to say that some of the revenue that has been raised has been returned technically to consolidated revenue. As has been reported, I think, to this committee before, all revenue raised as a matter of form by the courts is provided to the Department of Finance not directly to the courts. The courts as a matter of budget process do not retain any fee revenue. All fee revenue is provided to the Department of Finance and then the Department of Finance, through an appropriation, provides operating funds to the courts. I have a recollection that you or others have had this discussion previously with Secretary Wilkins about the fact that, at the end of the day, all of the revenue is provided to consolidated revenue. It must go to the Department of Finance, and the Department of Finance then uses consolidated revenue to provide operating funds to the courts.

Senator JACINTA COLLINS: I understand that, Mr Fredericks. But I think the answer that you gave me earlier is the one that addresses the issue, which is: we have the government raising $87.4 million and only $52 million of that will ultimately, through Finance, be directed back to the courts.

Senator Brandis: That is right.

Mr Fredericks : That is correct.

Senator Brandis: That is great because it means that we are able to repay at least that little bit of the Labor Party's debt from within this portfolio.

Senator JACINTA COLLINS: I understand that is your perspective, Senator Brandis. In an environment where yesterday you were explaining how you needed to find offsets for new measures, on this occasion you have simply donated $35 million to consolidated revenue off the backs of fees on litigants.

Senator Brandis: The fact that you choose the word 'donate' to describe trying to reduce public debt is very revealing. It is not the government's money; it is the taxpayers' money that the government takes from them compulsorily and should spend as little of as possible.

Senator JACINTA COLLINS: We could have a lengthy debate about progressive taxation, but this measure is vastly different from a progressive taxation measure.

Senator WRIGHT: I am going to continue with questions about the same sorts of issues. The figures that I had have been confirmed essentially. So I am operating on the same understanding. Am I correct in understanding that the $87.4 million in revenue will be raised through increased fees for users of the Federal Court, the Family Court and the Federal Circuit Court?

Senator Brandis: It is not quite as simple as that because, in some respects, Federal Court fees have been reduced. You are bundling three things together which are not the same.

Senator WRIGHT: Have there been increases to some Federal Court fees, as well as reductions?

Mr Fredericks : In answer to that question, can I refer you to the answer I provided in the first instance, which is: at the moment, the regulation that will give effect to the changes in fees has not been completed and registered, so I, as an official, cannot aver to that. In relation to your first question that the Attorney took, the correct formulation is the revenue is generated as a consequence of changes in the fee structure of the Federal Court, the Federal Circuit Court and the Family Court.

Senator WRIGHT: Thank you. We have been talking about an amount of $87.4 million that has been anticipated to be raised. I am interested in knowing: does part of that figure come from a projected increase in some fees to Federal Court users?

Mr Fredericks : I can only repeat my answer: that revenue is generated as a consequence of changes to the fee structure of the three courts.

Senator WRIGHT: So will there be some changes to the fee structure? We already had the Attorney-General—I do not mind who answers this—who said that there will be some reductions, so he is happy to say categorically that there will be some reductions to Federal Court fees. I am asking: will there be some increases to some Federal Court fees?

Mr Fredericks : Senator, I apologise—

Senator WRIGHT: Perhaps I can ask the Attorney-General, then.

Mr Fredericks : I cannot answer that question, because that is currently a matter that is still before government and it will be the case until the regulation is registered.

Senator WRIGHT: I do understand the regulation would need it. But there is a projection in the budget, is there not, on the basis of something. I am trying to find out what the basis of that projection is.

Senator Brandis: I can tell you, because you have noticed, as I pointed out, that some Federal Court fees are being reduced. We actually expect that to increase the revenue to the Federal Court because, as a result of what might be called Labor Party economics, a decision was made to increase Federal Court fees in insolvency matters. That meant the Australian Taxation Office, the principal insolvency applicant, took most of its business to the state Supreme Courts—we had this discussion yesterday. As a result of the increase in the fee, the revenue fell for the obvious reason.

Senator WRIGHT: I am aware of that.

Senator Brandis: We expect, as a result of the reduction of the fee to make the Federal court competitive for those kinds of applications with the state Supreme Courts, the revenue will actually rise. That is the difference between Labor Party economics and Liberal Party economics.

Senator WRIGHT: I am interested in asking about the fees. You have indicated that, as a result of reductions in fees which have not been effected yet through regulation—am I right in thinking that? It is part of the regulation?

Senator Brandis: I think the regulations are yet to be promulgated, aren't they, Mr Fredericks?

Senator WRIGHT: I do not want to be cute. It just seems that you are willing to talk about decreases that have not yet been passed in the regulations, but not increases. I am just trying to find out for the public the degree to which there is some accuracy about this.

Mr Fredericks : Again—

Senator WRIGHT: I am not asking you, Mr Fredericks; I am going to ask the Attorney-General, because he has actually responded in terms of saying there is going to be a reduction in some Federal Court fees.

Senator Brandis: I am reminded by Mr Fredericks that the regulation, although it was made this morning in fact, has not yet been placed on the federal regulation register. Strictly speaking, this has not occurred quite yet though it is imminent. In those circumstances, it is probably best, for the reasons Mr Fredericks explained, to say nothing more about it yet.

Senator WRIGHT: Okay.

Senator Brandis: When the regulation appears on the website, you can see for yourselves.

Senator WRIGHT: There have been media reports about projected fee increases. In the interests of open government and the fact that the public would be interested to know what these might mean, I am asking these questions of you in estimates today. I have never understood that this was an inappropriate line of questioning previously.

Senator Brandis: I never said it was—

Senator WRIGHT: So I will ask you and, if you do not answer, then so be it. I am asking then: which fees will be increased? It has been reported, for example—and I do not know if this is accurate or not, so this is your opportunity to say whether it is or not—that the fees for divorce applications will rise from $845 to $1200 and consent orders in the Family Court will rise from $150 to $240. Are those reports accurate in terms of what is being proposed to raise this amount we have heard about of $87.4 million?

Senator Brandis: Yes.

Senator WRIGHT: Yes? Thank you. Has any research been undertaken to confirm media reports that a fee hike of this nature would mean that legal divorce would be out of reach for many community legal centre clients, including women who are trying to remove themselves or flee domestic violence?

Senator Brandis: Senator Wright, first of all, we do not undertake research to confirm media reports. Secondly, you are reasonably familiar with this area, so you would know that there is an enormous amount of research conducted by organisations, including the Institute of Family Studies and others, into family law and the impacts of various effects on family law matters.

But most importantly, as you should be aware—and I will ask Mr Fredericks to elaborate on this because I just do not have the figures immediately before me—there are very substantial exemptions for needier family law parties from these fees. Mr Fredericks, can I ask you to inform the committee what those thresholds are because they do reflect the government's overall philosophy, which I tried to explain yesterday in a slightly different context, of focusing our legal assistance on the people who need it most.

Mr Fredericks : In the family law system, there are two fees. There is a full fee for divorce and there is a so-called reduced fee for divorce applications. It is interesting to note that our data tells us that approximately 30 per cent of all divorce applications are actually dealt with on a reduced-fee basis rather than on a full-fee basis. With the attorney's permission, I think I can also say that the reduced fee is not being increased in this budget.

In terms of the criteria, essentially the sort of criteria that are examined when consideration is being given by the courts as to which fee will apply, the full fee or the reduced fee, the sorts of considerations are these: whether a person has been granted legal aid under a specified legal aid scheme or service; whether the person is a holder of a health care, pensioner concession or seniors health card issued by the Commonwealth; whether the person is serving a sentence of imprisonment or is otherwise detained in a public institution; whether the person is younger than 18; whether the person is receiving youth allowance, Austudy or ABSTUDY benefits; or, interestingly, whether, in the opinion of the registrar or an authorised officer—so I emphasise it is an official of the court not the government that makes this decision; or whether in the opinion of that individual the payment of the fee would cause financial hardship to the individual.

Senator Brandis: What that means is that the only people who bear the burden of the increased fee are the relatively better off; the relatively less well-off have been entirely shielded from any increase in the fee. I was hopeful that would have been conformable to your notions of social justice.

Senator WRIGHT: I actually reflected earlier I am fairly familiar with this area because there was a references committee review of court fee increases since 2010. You were quite vocal, if I dare say, in opposition of court fee increases, so I am just responding to what you said earlier.

Senator Brandis: I am sorry, Senator Wright, that what you are thinking about this would be so materially shaped what I might have said five years ago. But, of course, five years ago I do not think we quite had the fiscal catastrophe that we inherited two years ago.

Senator WRIGHT: Perhaps I could just ask then, in terms of the criteria for the reduced fee, I suppose, given that there is a lot of evidence that there is an increasingly unmet need in legal services, even from people who would have once been considered to be middle-class, and that the fee increase from $845 to $1,200 for a divorce application is 50 per cent, then is it reasonable to think that there will be more people indeed who will be eligible for the reduced fee category because, if there is a capacity pay aspect to that judgement, it is going to be harder for them to meet, is it not? Twelve hundred dollars compared to $845 is a significant increase, even for people on reasonable incomes. My point is there may well be more people in that category. Is that right to think, Mr Fredricks?

Senator Brandis: I will take that. I think that is conjecture. You may well think that. I think in order to arrive at reliable conclusions about a matter like that, you would actually need some proper empirical study—

Senator WRIGHT: Absolutely.

Senator Brandis: rather than mere speculation by officials or ministers at the table.

Senator WRIGHT: Yes, and that is why I asked the question about what research there was as to whether a fee increase of this nature might mean that there are more people who have not got access to the ability to achieve a divorce within a timely way.

Senator Brandis: Can I add one other observation, please. The discrimination between those who pay the reduced fee, which is not being increased, and those who do not get that concession pay the increased fee, is not based on a numerical threshold or an income or an asset threshold. It is based on the qualitative criteria that Mr Fredricks recited in his earlier answer to you. So if it were a quantitative threshold, it might be reasonably easy to do that exercise and arrive at the conclusion you have just suggested. Given that the criteria are qualitative not quantitative, I do not think it is by any means clear that that conclusion does follow.

Senator WRIGHT: No, that is the thing, isn't it? I suppose it is a fairly subjective test, from the sounds of what Mr Fredricks said earlier.

Senator Brandis: I do not think it is subjective at all. It is qualitative. It means that there are specified criteria which have to be applied. The decision maker has to have regard to those criteria but the criteria are not especially vague; they are quite specific.

Senator WRIGHT: I have not got the criteria in front of me but I recollect that one of the other factors was influencing capacity to pay, or something along those lines. Is that right? All I am saying is that that then would leave discretion on the part of the court official making that judgement.

Senator Brandis: There is discretion.

Senator WRIGHT: All I am saying is that given that that is an element—it is not a numerical figure—then capacity to pay would be influenced by the size of the increase in the court fee. It is a 50 per cent increase so it is logical to think that somebody's capacity to pay may well be affected by the size of that increase.

CHAIR: Is there a question?

Senator WRIGHT: Attorney, are you offended by me asking you this question?

Senator Brandis: I think the problem you have—

CHAIR: No, Senator Brandis. We are not interested in Senator Wright's problems. If there is a question, will you answer it.

Senator Brandis: I am trying to work out where she is going, and respond to it; that is all.

CHAIR: She should not be making statements and arguing.

Senator Brandis: I think she is trying to ask a question. I do get the gist of what you are saying, Senator Wright.

CHAIR: What is the question?

Senator WRIGHT: I am asking is there any research about the impact that this is likely to have on people's ability to use the courts and is there any intention to have any research in that way?

CHAIR: Okay, that is a question.

Senator Brandis: I do not have an intention to commission any particular research. That is not to say that others in the family law system might not choose to commission their own. The problem with what you are putting to me is you are confusing the notion of subjectivity with the notion of discretion. They are not the same thing.

Senator WRIGHT: I do not agree that that is the case. Does it concern you, in terms of your professed concern about access to justice for people, that this may have an impact on the capacity for people, for instance people who are trying to leave violent relationships, on their ability to have closure and achieve a divorce, for instance? Does that concern you?

Senator Brandis: What we have done is protect the more vulnerable people from any increase. In a perfect world, there would not be a budget deficit. In a more perfect world, we would not have to find savings to pay off a public debt, which will take perhaps a generation to pay off. But this is not a problem of my government's making.

Senator JACINTA COLLINS: Can you confirm the report that court fees for tax matters—and the attorney mentioned some—will be reduced and, if so, which ones?

Senator Brandis: Not tax matters so much as windings up and things like that in which the most common plaintiff is the Commissioner of Taxation. But, usually, that is in a debt collection context. It would be odd to characterise that as a tax matter. It is a debt collection matter of which the Commissioner of Taxation is usually the applicant.

Senator JACINTA COLLINS: Any others?

CHAIR: Just while we are thinking about that, the secretary advised me that yesterday, Mr Moraitis, we said that we would let you know whether it was likely that we would need to get people from group 3 back this afternoon but it is looking increasingly unlikely. So I think we can make the decision to wipe that and your officers can go about their productive work rather than sitting in the back of the room here waiting. We will make some other arrangements perhaps to hear further from them later on.

Dr Smrdel : The fee structure that we are implementing for the Federal Court will remove some of the fee categories that were present. Previously in place was the public authorities category, which had entities such as the tax office paying the corporations rate. There was also a separate category for publicly listed companies which had publicly listed companies paying a greater fee, about 50 per cent more, than the standard corporations rate. So the changes will mean that the publicly listed companies level will be removed so that publicly listed companies will be paying the corporations rate like all other corporations. Also, public authorities, such as the tax office, will now no longer be paying the corporations rate. They will be paying the other rate, which is the same rate that applies to individuals and small businesses.

Senator JACINTA COLLINS: Can you break that up into the fiscal impact?

Mr Fredericks : I think I can assist with that one. I am only repeating evidence that I gave yesterday, but that evidence is as follows—

Senator JACINTA COLLINS: Sorry, where did you give this evidence yesterday?

Mr Fredericks : In estimates in group 2.

Senator JACINTA COLLINS: What was that under?

Mr Fredericks : I think Senator O'Sullivan asked questions—

Senator O'SULLIVAN: Just at the end of it.

Mr Fredericks : I am very happy to repeat it. It directly answers your question. The change which effectively has been reversed came into effect on 1 January 2014. In the year before that fee increase occurred, the Federal Court collected $24.6 million in revenue. In the year after that fee increase occurred—that is, 2014—the Federal Court collected $12.8 million in revenue. So there was a 48 per cent decrease in revenue as a consequence of that increase in that corporate fee and as a result of the Australian tax office moving its corporations work out of the Federal Court consequently.

Senator JACINTA COLLINS: Yes, that is helpful, but I was actually asking if you could give me the information broken up into the two measures.

Mr Fredericks : We would have to take that on notice.

Senator JACINTA COLLINS: Okay, thank you. Was there a particular call for this change to be reversed?

Mr Fredericks : I think it is fair to say that the Federal Court expressed concern about this change. I alluded to this matter yesterday as well. The Federal Court had concerns on two levels. The first was its concern about a change in the revenue base. Of course, that was on behalf of government as a whole. The second concern was a reputational issue for the Federal Court, because essentially a volume of significant corporate work was leaving the Federal Court to go to the state supreme courts. In the interests of the federal justice system, there was a concern about that important work leaving our system.

Senator JACINTA COLLINS: What about the other fee change—the increase? What was the call there, if any? Was the Family Court or the Federal Circuit Court seeking to have their fees—

Mr Fredericks : At the end of the day, that was a decision government made in the budget context.

Senator JACINTA COLLINS: I understand that. I am asking what you can apprise me of, as you just did about the fee reduction, about any call that existed for a fee increase?

Mr Fredericks : I do not think it came as a surprise to anyone here. I am not aware of anyone out there who was arguing for an increase in fees.

Senator JACINTA COLLINS: So, whilst the Family Court and the Federal Circuit Court are happy to have additional revenue, they were not calling for that to be achieved by virtue of a change in the fee structure?

Mr Fredericks : I think they appreciate the benefits of it. That is what the CEOs said earlier.

Senator JACINTA COLLINS: Have the department or the courts determined what impact the increase in court fees will have on people's ability to commence proceedings in the Family Court or the Federal Circuit Court? And let's pick up the other point that Mr Fredericks raised: do you anticipate people seeking alternative remedies as a consequence of a shift in the fee structure?

Mr Foster : No, we don't. The only place you can file for divorce is the Family Court—

Senator JACINTA COLLINS: Convenient that, isn't it!

Mr Foster : or the Federal Circuit Court. And it is primarily the Federal Circuit Court. Those matters are heard by registrars. There are about 45,000 of those matters a year. There does not seem to be much movement in that regard either. We do not expect those numbers to change because of the increase in fees at all because of the various exemptions that apply to people who cannot afford to pay the full amount.

Senator JACINTA COLLINS: Are the details of those exemptions publicly available?

Mr Foster : I am not sure of the top off my head what statistics we have in that regard—but we have revenue targets.

Senator JACINTA COLLINS: I think we referred earlier to the proportion of people who are paying concessional fees.

Mr Foster : Those are the criteria. But what happens in our registries is that a client service officer will make a decision about whether a person can have a reduced fee—and that is reviewable by a registrar. I am not sure whether we keep the number of those, because we just do it with—

Senator JACINTA COLLINS: I am interested in the numbers—and they must exist somewhere because somebody was telling me that 30 per cent of cases involve a concessional fee—and also the guidelines for applying the concessional fee.

Mr Foster : The guidelines are on the website, as Mr Fredericks said.

Senator JACINTA COLLINS: You do not believe there will be any disincentive to families in crisis, for instance, to access court services because if those are their circumstances they will have access to the exemptions.

Mr Foster : That is absolutely right.

Senator JACINTA COLLINS: I suppose we will see. I appreciate that you cannot talk about the detail of what the new fee structure will look like, but have you been consulting?

Mr Foster : Yes, we have.

Senator JACINTA COLLINS: Are you able to tell me in general terms what proportional increase you believe will occur for a litigant?

Mr Foster : Until the regulations are tabled, I do not think I can get into that level of detail; it is a similar argument to what the department is putting to you. We have been consulted because we need to make changes to our IT systems. With the fees coming into effect on 1 July, we have work to do on our systems.

Senator JACINTA COLLINS: I hope that is not the only reason you have been consulted!

Mr Foster : No. We have been advised about the increase in fees and how it impacts on our budget. Obviously we, like everyone else, are concerned about any impact it might have on litigants but, with the exemptions that are in place and the concessions, we do not believe it will have a significant impact on litigants.

Senator JACINTA COLLINS: Do you see that there may be a greater call on the exemptions?

Mr Foster : I am not really certain. The exemption criteria are pretty clear about whether you qualify. It is not about whether the fee is $1,000 or $1,200, but what your personal circumstances are.

Senator JACINTA COLLINS: How will the money raised through the increased fees be spent to streamline and improve the sustainability of the court? You have mentioned some capital works.

Mr Foster : We have been running at losses because the courts have grown and our costs have increased. We have gone through a significant amount of reform—and we have talked about those reforms in this place endlessly. One of the most significant things was the amalgamation of the administration of the two courts, which saved $7.8 million, most of which was returned to government. Since 2008 we have returned nearly $60 million to government in savings. So we have done quite a lot of work to try and improve our efficiency. That has been done by improving our systems and ensuring that we have standard case management practices.

Senator JACINTA COLLINS: So that 60 is ahead of this 35?

Mr Foster : That is what we have done since that time, to date. And the extra 35 is an extra sum of money.

Senator JACINTA COLLINS: Yes, so that becomes 95 now. You can say you have returned it to government.

Mr Foster : That is money we have collected and sent to the Department of Finance; it is not actually a saving from our appropriation.

Senator JACINTA COLLINS: I understand that. Now, arising from the restructuring, the merger, those sorts of saving measures, will there be any job loses?

Mr Foster : The restructure between the Federal Circuit Court and the Family Court happened some five or six years ago so, yes, there were some job loses then.

Senator JACINTA COLLINS: No, but I mean—

Mr Foster : The current restructure is not really something that I can speak about. No formal decisions have been made about that as yet. But as far as we are concerned, with our budget, in terms of the Family Court and the Federal Circuit Court, there will be no staff reductions next financial year. It is basically business as usual. If any restructure happens outside of the next financial year after that, then it just remains to be seen what other efficiencies will be brought to bear.

Senator JACINTA COLLINS: The comment here is that courts will be required to:

… enhance their sustainability through greater efficiencies, including merging their corporate functions from 1 July 2016.

Mr Foster : That is right.

Senator JACINTA COLLINS: I am asking you specifically about those measures, about whether you understand there will be job losses associated with those or what other information you can give me about what is anticipated with respect to those efficiencies.

Mr Foster : That is a matter that is best answered by the department. They are the ones running this particular project and we are just—we are being consulted all the way through and cooperating with the department, but, in terms of the numbers, I have not seen the models that are detailing what savings would be made by that. That is something that has been done through the Attorney-General's Department.

Senator JACINTA COLLINS: Have you raised any concerns in that process?

Mr Foster : We have raised a number of issues about the process and concerns, but we are working through those with the department.

Senator JACINTA COLLINS: Okay. Mr Fredericks, what can the department assist us with?

Mr Fredericks : I should say, it is probably too early for any exposition of that issue. As Mr Foster is saying, it is a matter that is still before government. It is being worked through sensibly between ourselves and the courts and, in a sense, an important part of the proposal will be legislation, which will need to be brought forward to give effect to any change, and that legislation is being prepared as well. At this stage it is probably a work in progress, as it should be—a very careful work in progress—and, as I said, it will see the light of day in the first instance when legislation is presented to the parliament, and I would be very wary about pre-empting that.