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Finance and Public Administration Legislation Committee
03/03/2017
Estimates
CROSS-PORTFOLIO INDIGENOUS MATTERS
Office of the Registrar of Indigenous Corporations

Office of the Registrar of Indigenous Corporations

[9:42]

CHAIR: Mr Beven, do you wish to make an opening statement?

Mr Beven : No, thank you.

Senator McCARTHY: Good morning, Mr Beven.

Mr Beven : Good morning.

Senator McCARTHY: I would like to take you straight to your report of 1 July to 31 December 2016.

Mr Beven : Are you referring to—

Senator McCARTHY: Complaints involving Aboriginal and Torres Strait Islander corporations. In that report you identified that 372 complaints were received and 383 complaints were finalised. Can you let the committee know if all of those 372 were from July to December?

Mr Beven : Yes. The way the report is structured is the date we receive the complaint, if it falls within that period we report in that period. Some complaints will be finalised in the following period. That is why you see the difference in numbers. We report them on the day we receive them and the day we finalise them. Some may be started in a particular period and finished in the next period. They will be reported as received in this period and finalised in the following period.

Senator McCARTHY: So, 383 finalised. How many were from July to December?

Mr Beven : In terms of finalised?

Senator McCARTHY: Yes, of the 383.

Mr Beven : Just to be clear, we are talking about the period 1 July 2016 to 31 December 2016?

Senator McCARTHY: That is correct.

Mr Beven : In that period, we received 372 complaints and we finalised 383.

Senator McCARTHY: So, the 383 finalised were finalised in that six-month period?

Mr Beven : In that six-month period. So, some of them would have started prior to 1 July. Some of the more complicated complaints we take on average 80 days to deal with. Obviously if they are started late in the period they may go over into the following period.

Senator McCARTHY: I will get to that in a moment. So, each month, on average, there are 62 complaints; is that correct?

Mr Beven : Yes. It varies. I think last month we had about 80 complaints, but on average it is around about 50 to 60 complaints per month.

Senator McCARTHY: In terms of your average number of days to finalise complaints by type, you have straightforward, being five days?

Mr Beven : That is right.

Senator McCARTHY: Detailed is eight days and complex is 68 days, possibly up to 80 days? Could you explain to the committee what comes under the straightforward category?

Mr Beven : A straightforward complaint would be a very minor issue that someone may have and we may be able to satisfy their complaint immediately over the telephone. Let us say, for instance, someone may have a complaint about the conduct of an annual general meeting and they may just require some further information as to what they can do to address their concerns about how that AGM was conducted. With the straightforward complaint we are able to assist them in a very quick timeframe. It is not a complicated issue.

Senator McCARTHY: If we look at No. 2, detailed.

Mr Beven : Detailed.

Senator McCARTHY: What definition of complaint falls in there?

Mr Beven : Just roughly, a detailed complaint is one which would usually require a written response. It may require some consideration of some issues and it may require us to prepare a written response to the complainant.

Senator McCARTHY: And that usually takes eight days?

Mr Beven : On average, yes.

Senator McCARTHY: So, if we come to the complex cases. Could you define what falls into the complex category?

Mr Beven : A complex complaint, as the name suggests, is one which may have multiple issues. It may require consultation with the corporation. A complainant may have a complaint about a corporation. It may require us to write to the corporation and ask for their side of the events. It may require us seeking legal advice on a particular complicated issue and, in most of those cases, it will require a written response to the complainant.

Senator McCARTHY: In terms of legal advice or action, how does action then take place if it goes beyond solving the complexity if it needs to? What happens?

Mr Beven : What is the next step?

Senator McCARTHY: Yes.

Mr Beven : As you can see, we receive between 780 to 900 complaints a year, depending on the year. We look at all of those complaints. We obviously have limited resources, so we look at the ones where we can have the most impact, which have the most concerns and the most number of people that are affected. That may involve corporations delivering essential services such as health clinics or remote stores where there is no other access to food. We also have a look at whether government funding is at risk. We weigh up a number of issues. We then determine whether there is sufficient evidence and whether we should allocate particular resources to taking a particular regulatory action in relation to that complaint, if we have not been able to solve it at the first instance.

Senator McCARTHY: How do you assess or monitor satisfaction or otherwise of your way of concluding that complaint?

Mr Beven : The role that we play is not so much to satisfy complainants. In all cases it is not possible to satisfy complainants. Our role is to administer the legislation, provide as much information as possible to the complainants, advise them of what their rights and their options are and, if necessary, to escalate it so that we can actually intervene and assist them. In terms of satisfaction, as in most complaints you are always going to have someone that is satisfied and someone that is dissatisfied. So, in terms of satisfaction that is not what we measure ourselves against. We measure how many complaints we receive, whether we have been able to close them in a timely way and then, if someone is dissatisfied with the response they receive from our office, in all of our outcome letters we provide them with what their appeal rights are, whether it is to the ombudsman or to some other avenue.

Senator McCARTHY: What about in relation to you taking the information to the minister? What is the process there?

Mr Beven : We do not report complaints to the minister on a usual basis. There may be instances where a corporation is funded by the government, by the department. We may raise that with the department and they may raise it with the minister. The minister may raise complaints that he has heard about corporations with my office, but we do not prepare a regular report to the minister in relation to complaints.

Senator McCARTHY: Do you have any regular meetings with the department?

Mr Beven : Yes. We are based within the same building as the department. When a particular issue or a particular complaint arises in relation to a corporation and we are aware that it is funded by the department we will consult with the department and, equally, if the department becomes aware of a concern they have through their monitoring of their funding they will raise that with my office as well.

Senator McCARTHY: If we look at the complex cases, how many of those 383 finalised were complex?

Mr Beven : Sixty-eight.

Senator McCARTHY: So, 68?

Mr Beven : No. It was 51.

Senator McCARTHY: So, 51 in the last six months?

Mr Beven : From July to December.

Senator McCARTHY: In that period to December?

Mr Beven : So, it is 14 per cent of the total complaints.

Senator McCARTHY: Could you let the committee know the types of complaints that you received out of those couple of hundred?

Mr Beven : Of the complex ones?

Senator McCARTHY: Yes.

Mr Beven : The complaints we receive cover a wide variety of matters. I am sure you also receive similar complaints about Aboriginal and Torres Strait Islander corporations and so you would be aware that they cover a wide range of topics from employment, whether someone has been unfairly dismissed or their salary package has not been paid, around services being provided by the corporation, around the roles of directors and decisions made by directors, the conduct of annual general meetings or special general meetings. One of the most common complaints we receive is in relation to native title, who is a traditional owner and who is not a traditional owner.

Senator McCARTHY: How do you deal with that? I understand that is out of your purview so how do you deal with native title complaints?

Mr Beven : You are right; it is outside of our jurisdiction. There are some options that we can help people with. We cannot help people determine who is or is not a traditional owner, but each rule book that is registered under the CATSI Act for any corporation must have a dispute resolution clause. Most native title bodies will have a dispute resolution clause that adopts traditional means of dispute resolution. So, whether it is reference of a dispute to an elders council or to a particular elder. We can assist people to utilise that dispute resolution process, which is normally a traditional one, to address any concerns they have, but in terms of absolutely resolving their issue, no, that is outside our jurisdiction.

Senator McCARTHY: What percentage of your complaints would be around native title?

Mr Beven : In that period of 1 July to December we had 14.

Senator McCARTHY: What about the average yearly?

Mr Beven : That would be about the same. So, about 28 to 30 would be roughly the average. It is fairly consistent.

Senator McCARTHY: What is your largest complaints?

Mr Beven : The largest category of complaints we have is about the conduct of directors and officers of corporations. So, has a director possibly breached their duties as a director? Have they not followed the rule book in relation to how decisions are made, quorums and calling meetings. That is the most common category of complaint that we receive in relation to the conduct of directors and officers.

Senator McCARTHY: Is that right across Australia or is that just in one jurisdiction?

Mr Beven : It is right across Australia, but in terms of where proportionally we get the most complaints it is Queensland. Queensland, South Australia and Victoria are the highest jurisdictions. Northern Territory is the lowest. So, proportionally we receive less complaints about Aboriginal and Torres Strait Islander corporations in the Northern Territory than we do in Queensland, South Australia and Victoria.

Senator McCARTHY: Yet it would be the highest complaint category everywhere?

Mr Beven : Yes, that is right. It is spread right across Australia. It is fairly consistent that complaints about directors to DCS would be consistent right across Australia.

Senator McCARTHY: What is done to assist Aboriginal and Torres Strait Islander organisations to deal with what we often see as the inability to conduct the matters of board roles and organisations in a manner that receives less complaints?

Mr Beven : We have a multifaceted approach. We offer a whole range of free services to corporations that are registered with our office.

Senator McCARTHY: Like what?

Mr Beven : The first one is we provide free corporate governance training. For any Aboriginal or Torres Strait Islander people who are members or directors of an Aboriginal and Torres Strait Islander corporation we provide free corporate governance training.

Senator McCARTHY: How long does that go for?

Mr Beven : It varies. Last year we provided training to 882 people around Australia. We provide a wide range of training from very short training to what is classified as a diploma level which people actually—

Senator McCARTHY: What is short training?

Mr Beven : It can be half a day. We cater the training to meet the needs of individual corporations. We have half-day training, one-day training, two-day training and three-day training. For instance, next week we are providing training in Cairns to about 40 participants. That is a three-day formal classroom-type training. That then leads into a certificate IV and then a diploma level of corporate governance.

Senator McCARTHY: How much of your budget has to go into preparing those training programs?

Mr Beven : Approximately $780,000 is spent in terms of delivery of the corporate governance training program.

Senator McCARTHY: How do you break that down? Is that by state and territory or is that by need?

Mr Beven : In May of every year we look at where we are receiving high numbers of complaints, where we have received requests for training, we look at our budget and then we determine where we should allocate particular training activities. Then for that next financial year, at the end of May we put that calendar up on our website and people can apply to access that free corporate governance training.

Senator McCARTHY: Is this training voluntarily sought or is it something that ORIC compulsorily requires?

Mr Beven : It is voluntary. We can recommend people take the training. Corporations can recommend that the directors and members take the training, but it is voluntary attendance. It is not compulsory. Some of the other things that we do to help build the capacity of corporations is we have a free pro bono legal service. That is in partnership with the largest legal firms in the country. Any Aboriginal and Torres Islander corporation can apply for free legal assistance from one of the largest legal firms in the country. We set that up back in 2010 because we found a lot of directors were making decisions without legal advice. They are in a remote locality. They do not have access to pay for the cost of obtaining quality legal advice. So, corporations said to us, 'One of the things that we really need to assist with is getting good quality legal advice', and so we have partnered with all of the largest legal firms in the country. They now provide free legal assistance to any corporation that is registered under the CATSI Act.

Senator McCARTHY: Are you able to table the names of those legal firms?

Mr Beven : Yes. They are listed on our website.

Senator McCARTHY: In terms of staff commitment to the training, how many staff do you need to put aside for that?

Mr Beven : To deliver the training?

Senator McCARTHY: That is right.

Mr Beven : Normally we have three staff. At the moment, we have a graduate assisting and so we have four staff at the moment. We have three staff that deliver this training right around the country. It is a phenomenal effort that they do in delivering—

Senator McCARTHY: I am sorry. Are you saying you have four staff overall?

Mr Beven : Delivering the corporate governance training.

Senator McCARTHY: They are delivering it?

Mr Beven : That is right.

Senator McCARTHY: And the three staff who travel; is that right?

Mr Beven : Three staff that are permanent FTE. We also have a temporary graduate at the moment assisting in the training area.

Senator McCARTHY: So, three staff and possibly one when you can?

Mr Beven : That is right.

Senator McCARTHY: To train 882 people?

Mr Beven : Yes, and we also have a panel of largely or almost entirely Indigenous training consultants who go through our programs and deliver our training. We deliver our training face to face ourselves, but we also engage consultants, mainly Indigenous consultants, to deliver that training around the country.

Senator McCARTHY: Can I just take you to Tennant Creek, not literally. But if I can just take you to Tennant Creek to the good old Barkley region.

Mr Beven : I will be there in two weeks.

Senator McCARTHY: When did ORIC become aware of issues with Julalikari Council in Tennant Creek?

Mr Beven : Julalikari is one of the largest Aboriginal corporations in Australia. It is one of the most important in the Northern Territory and it is one that we have had a relationship with for many, many years. We have delivered corporate governance training to their directors many times. We have provided assistance in improving their rule book and to improve their corporate governance. My staff visit them on a regular basis. We have also, over the years, had complaints that we have received about Julalikari Council Aboriginal Corporation. But with any large Aboriginal corporation we would expect to receive complaints regarding that entity. For many years we have worked with the corporation and its members and people who have lodged complaints about the corporation to address those various complaints. To specifically answer your question, there have always been complaints about Julalikari, as there are with any large Aboriginal corporation, and we have just dealt with them through our usual processes for many years.

Senator McCARTHY: Let us have a look at that. At what point does ORIC step in, like in this case, to place an organisation into special administration if you have received so many complaints over time? When do you know when to do that?

Mr Beven : It is a juggling exercise. We conducted an examination of Julalikari in May 2013 and we also conducted a further examination in September last year. With a large corporation like Julalikari that delivers essential services funded by government and is such a key corporation in a community like Tennant Creek that is not unusual. We would expect to do examinations of them on a quite regular basis. Through those examinations we identified that there were some governance issues. There were complaints. Some of them were valid complaints that needed to be addressed. Back in 2013, as I said, we did some intensive work with the directors of Julalikari to review their rule book and provide corporate governance training to the directors. But in September 2016 the follow-up examination identified that there were still concerns that had not been addressed as we would have expected to be addressed.

Senator McCARTHY: Was that around the governance issues?

Mr Beven : Yes, but as you will see from the information on our website, the main concern that we had around Julalikari was that the corporation's ability to address those complaints was not as effective as we had hoped from 2013. The level of dispute with members and stakeholders within the Tennant Creek community was not easing. It was probably plateauing, but it was not easing. Our major concern was that the corporation's focus was shifting from service delivery and a lot of its attention was addressing these complaints and issues and disputes with various stakeholders. Our concern was that the corporation just needed some outside assistance to improve its policies, particularly around dispute resolution, having proper complaints processes in place and rebuilding relationships with stakeholders in the Tennant Creek community, but most importantly the membership of Julalikari. We have appointed a special administrator of Julalikari for six months to improve its governance and to improve its internal processes and structures to deal with complaints and issues and improve its service delivery.

Senator McCARTHY: In terms of the complaints that you received were they predominantly around the relationship with Julalikari and their community or the broader stakeholders or was it around the services delivered by Julalikari?

Mr Beven : Probably a mixture. I suppose you could categorise them as complaints or disagreements of how services should be delivered, how the corporations should be making decisions. Rather than issues around anyone stealing money or fraud or misappropriation, I could categorise most of the complaints around disagreements as to the direction of the corporation and the service delivery standards. I would categorise it in that category, not of the more concerning category of fraud and misappropriation.

Senator SIEWERT: I do not have any questions. I would like to say thank you for the briefing at last estimates. You undertook to provide a briefing. We did receive that briefing and I thank you very much for the briefing.

Senator McKENZIE: I have some questions about the strengthening organisational governance policy. Can you update the committee on organisations that have been incorporated over the past 12 months?

Mr Beven : As you would be aware, the minister announced that from 1 July 2014 entities that were receiving more than $500,000 in funding through the Indigenous advancement strategy—Indigenous organisations—were required to be registered under the CATSI Act. Since that policy came in, we have seen a number of entities transferring their registration from state legislation to the CATSI Act. For the six-month period from January to June there were four transfers. In the following six months, another four transfers. From January 2015 to June 2015 there were seven transfers.

Senator McKENZIE: Just the last 12 months.

Mr Beven : From 1 July 2016 to 24 February there have been seven transfers. On average between seven to 14 entities each year are transferring their registration. There have not been large numbers, but there have been some key organisations transferring across.

Senator McKENZIE: Are you aware of any organisations that have been incorporated under ORIC because of the strengthening organisational governance policy?

Mr Beven : Just an example of one recently—just last week the Tasmanian Aboriginal Centre Inc. transferred its registration across to the CATSI Act and it is now known as the Tasmanian Aboriginal Corporation. We have been working with TAC for over 12 months now assisting them with the transfer process. Through our pro bono legal service, we engaged one of the large private legal firms to provide legal assistance to the entity as part of the transfer process. I was very proud last week when the Tasmanian Aboriginal corporation was registered under the CATSI Act. It is one of the largest Aboriginal corporations in that state and a very important entity.

Senator McKENZIE: How long have governments been seeking to transfer that particular organisation?

Mr Beven : I could not answer that. We have built a relationship with the TAC over a number of years. We actually had a staff member based in Tasmania that met with the TAC, offered assistance, provided some advice around what the CATSI Act is and what would be the advantages and disadvantages. This has been a process over a number of years, building a relationship with TAC and then assisting them with the transfer process. I must say the corporation has been very welcoming of that and we have built a very good relationship with the corporation as a result of that.

Senator McKENZIE: Under the strengthening organisational governance policy, the organisations get additional support within that? That is that pro bono legal assistance.

Mr Beven : And a range of other services that we provide.

Senator McKENZIE: Such as?

Mr Beven : The free corporate governance training. We provide some assistance around recruitment. We provide assistance with the appointment of independent directors to the corporations that seek good-quality independent directors. That is an initiative where we have partnered with the Business Council of Australia. It is still growing, but it has a lot of potential of businesses sharing their expertise with Aboriginal and Torres Strait Islander corporations.

Senator McKENZIE: Given that that particular group is the largest in Tasmania, what benefits will flow on to the residents of those communities as a result?

Mr Beven : The main advantage is that the CATSI Act is modern legislation. The associations legislation in Tasmania was obviously passed through parliament with the intention of establishing small not-for-profit entities, whereas an entity like the Tasmanian Aboriginal Centre is a multimillion dollar organisation providing essential health services, legal advice, representational services on behalf of Aboriginal people and lobbying on behalf of the membership. The legislation probably was not fit for purpose for a large entity, whereas the CATSI Act is more modern legislation designed specifically for Aboriginal and Torres Strait Islander organisations.

In my office, 49 per cent of our staff are Aboriginal and Torres Strait Islander people. We are staffed by people from Aboriginal and Torres Strait Islander corporations. They know the circumstances that members, directors and corporations may face. We provide a range of free services that help to build the capacity of entities. We have seen extremely encouraging growth over the last 10 years where the top 500 Aboriginal and Torres Strait Islander corporations have increased their income by nine per cent every year for the last 10 years, which is phenomenal growth.

Senator McKENZIE: And particularly in these times.

Mr Beven : A lot of that is down to the work of Aboriginal and Torres Strait Islander people taking control of their corporations, delivering services to their people and their membership and backed up by strong legislation and my office.

Senator McKENZIE: Thank you.

CHAIR: Are there any further questions? In that case, I thank the Office of the Registrar of Indigenous Corporations. After just having a discussion with the deputy chair, rather than call the ANAO now we will proceed to the Department of the Prime Minister and Cabinet, because the Opposition and crossbench senators have an interest in CDP issues. So, any relevant officers for CDP could come to the table, and we will bring ANAO to the table later on this morning.