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Finance and Public Administration Legislation Committee
17/10/2011
Estimates
PRIME MINISTER AND CABINET
Department of the Prime Minister and Cabinet

Department of the Prime Minister and Cabinet

[14:13]

CHAIR: I welcome the Minister for Tertiary Education, Skills, Jobs and Workplace Relations representing the Prime Minister, Senator Hon. Chris Evans, and officers of the department. We will commence with Outcome 1 on general issues followed by the listed agencies. The committee will move to Outcome 2 and Outcome 3 later in the day. Officers and senators are familiar with the rules of the Senate governing estimates hearings. If you need assistance the secretariat has copies of the rules. I particularly draw the attention of witnesses to an order of the Senate off 13 May 2009 specifying the process by which a claim of public interest immunity should be raised. The committee has set Friday 2 December 2011 as the day by which answers to questions on notice are to be returned. Minister, do you wish to make an opening statement?

Senator Chris Evans: No thank you.

CHAIR: Then we will go to questions—Senator Ryan.

Senator RYAN: Minister, you may wish to answer these questions. Why was Dr Henry appointed as a special advisor to the Prime Minister under Section 67 of the Constitution?

Senator Chris Evans: I am happy to advise that he was appointed so as to utilise his skills and experience, but, in terms of why under that particular section, I will have to get one of the officers to help you, Senator Ryan.

Ms Leon : Dr Henry was appointed under that section of the constitution in order to enable him to range across a wide portfolio spectrum. It is not expected that the tasks on which the Prime Minister seeks his advice from time to time will necessarily be attached to any particular portfolio. The constitutional position enables him to be across the range of policy issues on which the Prime Minister might seek advice.

Senator RYAN: You said advice to the office; what about the department?

Ms Leon : His appointment is as a special advisor to the Prime Minister but he is working with officers of the department.

Senator RYAN: He has no capacity to direct officers at the department?

Ms Leon : He will lead a taskforce of staff within the department.

Senator RYAN: And he has the capacity to direct those?

Ms Leon : Direct their work.

Senator RYAN: Did the request to have Dr Henry appointed originate with the Prime Minister's office or did it come from within the department?

Ms Leon : I am just checking on the history of it. I am fairly sure that it came from the department, but I might have to take that on notice.

Senator RYAN: I would also be interested in the first suggestion of the appointment of Dr Henry.

Ms Leon : The appointment to the current taskforce?

Senator RYAN: No, the appointment as a special advisor.

Ms Leon : I may be able to answer that while I am here, and if I can I will, but I am fairly sure that came from the department.

Senator RYAN: Who prepared the documentation for his appointment as an advisor?

Ms Leon : The department.

Senator RYAN: The department prepared the documentation for the executive council?

Ms Leon : Yes.

Senator RYAN: Did the Prime Minister or the Secretary of the Department of the Prime Minister and Cabinet write to Dr Henry outlining his responsibilities in April 2011?

Ms Leon : I may have that here; I will just see if I have a copy available. The then secretary of the department wrote to Dr Henry in April advising him of the Governor-General's appointment of him.

Senator RYAN: Is it possible to have a copy of that letter tabled?

Ms Leon : I would have to take that on notice. It contains a number of matters that may be personal to Dr Henry and so I will take on notice whether it is possible to release it.

Senator ABETZ: What was the date?

Ms Leon : I think it is 4 April, though it is a bit obscured on the copy that I have.

Senator CORMANN: The date that he had been appointed or would be appointed?

Ms Leon : The date of the letter. No sorry, it is 4 May and the appointment was 21 April.

Senator RYAN: You may not be aware of this but I am assuming you would be: is Dr Henry still a member of the Australian Public Service?

Ms Leon : He is not an employee under the Public Service Act.

Senator RYAN: On what date did he cease to be employed as a member of the APS?

Ms Leon : His appointment as Secretary of the Department of the Treasury expired on 26 April.

Senator RYAN: What discussions took place between the department, or the Prime Minister's office, and Dr Henry regarding his appointment prior to his retirement or resignation, as the case may be, from the department?

Ms Leon : I would have to take that on notice. I do not have those details with me.

Senator RYAN: You do not have the details of discussions about his appointment to this section 67 office, if we might call it that.

Ms Leon : I do not have those details with me.

Senator Chris Evans: This was a prime ministerial appointment though.

Senator RYAN: That is why I am asking if it was the office or the department.

Senator Chris Evans: There may well have been discussions. I got a bit confused in the earlier question. This is a decision by the Prime Minister.

Senator RYAN: I know. That is why I am asking while you are at the table, Senator Evans.

Senator Chris Evans: You went to the technical question. I did not know the answer to that so the officer gave you the answer to that in terms of the appointment under the act.

Senator CORMANN: Was it a cabinet decision or was it the Prime Minister's personal decision?

Ms Leon : We do not ever disclose what is discussed in cabinet.

Senator CORMANN: But you can say whether it was a decision of government.

Senator Chris Evans: No, we do not. The point is, the Prime Minister made it very clear it was her decision to invite Dr Henry to do the role. That is what I was trying to clarify before. I thought it left the impression that maybe the suggestion had come out of the Public Service. It may have originally, but all I am saying is that it was a decision by the Prime Minister that he be appointed to this role.

Senator RYAN: In a letter to the Financial Review, published on 17 October, Dr Watt, Secretary of the Department of Prime Minister and Cabinet, said that Dr Henry's role as a special adviser is limited to his leadership of work on the white paper on Australia in the Asian centuryannounced by the Prime Minister on 28 September. What was he doing beforehand?

Ms Leon : He has been on leave.

Senator RYAN: Until?

Ms Leon : He was on leave from when he finished as Secretary of the Treasury.

Senator RYAN: Until when? When is he commencing?

Ms Leon : He is still on leave. The task force is still being established so work on the task force that will require his dedicated attention has not commenced as yet. The task force is being established and departmental officers are commencing the preliminary work. His involvement is only limited at this stage.

Senator RYAN: But you said he is still on leave.

Ms Leon : That is correct.

Senator RYAN: Is his involvement limited or is he not involved while he is on leave?

Ms Leon : His involvement is limited at the moment.

Senator RYAN: Is he on leave with or without pay?

Ms Leon : He is on leave with pay.

Senator RYAN: What form of leave is it?

Ms Leon : Long-service leave.

Senator RYAN: He is essentially, you are saying, Ms Leon, working during his period of long-service leave—

Senator Chris Evans: Ms Leon was suggesting that he is obviously being consulted about the role and people are dealing with him but he has not formally commenced the role, as the task force is being established, and he will commence shortly, as I understand it. But he is currently still on accrued leave from his time as Secretary of the Treasury.

Senator RYAN: So essentially he is working during the period of long-service leave that he accrued in his previous role, in his limited capacity, that you referred to.

Ms Leon : Saying that he is working during that period probably goes further than indicated. His role in relation to the task force is around its establishment and being consulted about the work rather than him yet coming into the office and working in a dedicated way on the subject matter of the task force.

Senator CORMANN: This might be a dumb question. Why was Dr Henry appointed as a special adviser to the Prime Minister effective from 27 April 2011, the day after he finished as Secretary of the Treasury, when he is not due to start in that role until some unspecified point in the future?

Ms Leon : He was appointed at that time so that we could ensure we retained his services, but the Prime Minister had not, until recently, tasked him with a particular role.

Senator CORMANN: He was special adviser for five months, on leave, without a specific job, and presumably he was not drawing any salary or entitlements related to his role as a special adviser to the Prime Minister. Is that right?

Ms Leon : He has been on leave using his entitlements accrued during his time in the secretary of the Treasury role.

Senator CORMANN: And there are no additional entitlements accruing in the time that he was appointed since 27 April?

Ms Leon : If you are asking if he is being paid for his leave, and also paid as special adviser, no he is not.

Senator CORMANN: No, that it not what I am asking; I am asking whether there is any relevance to Dr Henry's entitlements to being appointed on 27 April 2011 the day after he finished in his role as Treasury Secretary rather than wait until he becomes available to perform the duties as special adviser to the Prime Minister?

Ms Leon : I am sure if the Prime Minister had asked him to start performing those duties immediately on 27 April, Dr Henry would have made himself available, but she has only now tasked him with a role.

Senator CORMANN: So it was not so much a matter of Dr Henry not being available; it was a matter of the Prime Minister not knowing what she wanted him to do?

Senator Chris Evans: I do not think we can read the minds of both parties in terms of those discussions. The facts are: Dr Henry finished at Treasury. He has a decent amount of leave, which he is now taking. He has not yet started in the position relating to the Asia white paper but he will do shortly and, from that point on, he will obviously be employed as a special adviser but the appointment had not been activated, if you like, had not been given fresh work until such time as this was announced.

Senator RYAN: His appointment did not involve any reference or discussion regarding this white paper that he is working on now—I take that from what you have just said. Prior to—

Senator Chris Evans: Senator, I am not sure I would agree with the way you have phrased that. I think what we have tried to indicate is no doubt there have been discussions about how the white paper would be completed, who might be involved in it. I think the officer was trying to give you the sense that he is involved in those sorts of discussions but he is not at work.

Senator RYAN: Okay. So were there any discussions about Australia in the Asian century white paper at the time of his employment between the office and Dr Henry, or the department and Dr Henry?

Senator Chris Evans: You might have to take that on notice.

Ms Leon : I think that is encompassed in my having taken on notice whether there were discussions with Dr Henry about—

Senator RYAN: I have just learnt to be very specific in the questions I ask.

Senator Chris Evans: We will take that on notice.

Senator RYAN: I would appreciate the advice and, if there were discussions about that, what those entailed? Was Dr Henry consulted by the department or by the office regarding this specific project which he is now tasked with prior to its announcement by the Prime Minister?

Dr de Brouwer : Yes, there was discussion with Dr Henry about the subject matter.

Senator RYAN: When was that discussion?

Dr de Brouwer : I do not know the exact dates, Senator, but I will take that on notice. In the lead-up to that announcement, there was significant discussion with Dr Henry about the subject matter.

Senator RYAN: I would appreciate the date of that discussion and are you referring to one with the department and Dr Henry or—

Dr de Brouwer : Of the department with Dr Henry.

Senator RYAN: Senator Evans, are you able to answer whether or not there were discussions between the Prime Minister and Dr Henry about this project or her office and Dr Henry?

Senator Chris Evans: I will have to take that on notice because I do not know. I would be surprised if there wasn't but, for the purposes of accuracy, I will take it on notice. I would be surprised if they did not discuss it, but factually, I do not know so I will take it on notice.

Senator RYAN: I would appreciate advice on when it took place, if it did take place.

Senator Chris Evans: I will take that on notice.

Senator RYAN: A spokesman for the Prime Minister was quoted in the Australian on 6 October saying:

Dr Henry has agreed to be bound by the (Australian Public Service) code of conduct and has given a written undertaking that he will disclose, and take reasonable steps to avoid, any conflict of interest…

et cetera. When was the decision taken that Dr Henry would be bound by the APS Code of Conduct?

Ms Leon : I would have to take that on notice.

Senator RYAN: I am asking both the department and the office when the decision was taken that Dr Henry was bound by the APS Code of Conduct and, specifically, the date as to whether it was prior to his employment, subsequent to his appointment or subsequent to other appointments.

Senator Chris Evans: We will have to take that on notice.

Senator RYAN: The instrument of appointment of Dr Henry says that in item 3 'for any period that the special adviser performs the duties of that office on a full-time basis, the remuneration and other terms and conditions of employment for the special adviser be the same as those applied to the position who holds the position of secretary of the Department of Treasury at the relevant time.' Is that provision still in place?

Ms Leon : Yes.

Senator RYAN: Is Dr Henry on this particular project going to be tasked with working on a full-time basis at any point?

Ms Leon : At the moment it is anticipated that Dr Henry will be required only on a part-time basis for this project.

Senator RYAN: How many hours a week are we looking at on a part-time basis?

Ms Leon : It is a little bit fluid at the moment, but we envisage that it could be in the vicinity of one to two days per week.

Senator RYAN: This structure does seem quite fluid. Is it your opinion—

Ms Leon : I should say that the nature of leading a task force is that there will be peaks and troughs of work, so there might be periods where the task force is undertaking research or consultations and amassing material ready to be considered by Dr Henry for his guidance; so there might be periods where Dr Henry works several days in a row and then not for two weeks while further work is done. It is not expected to be a strict formula of every Monday and Wednesday, for example; it will be determined by the conditions of the work.

Senator RYAN: I appreciate that. But it is the second part of this clause that interests me, where it says that 'the terms and conditions of employment should be the same as those that apply to the person who holds the position of Secretary of the Department of the Treasury'. I may be being a bush lawyer, Senator Evans, but on a layman's reading that does seem to place limitations upon one's ability to be on the board of a bank.

Ms Leon : The question as to being on the board of the bank would be to determine whether there was any conflict between the duties of the position, rather than the question of whether his pay is the same as the secretary of the Department of the Treasury.

Senator RYAN: So the 'terms and conditions of employment' applies only to the remuneration?

Ms Leon : That is correct. And other terms and conditions, such as leave and so on.

Senator Chris Evans: At a part-time rate.

Senator FIFIELD: 'Terms and conditions' is broader than just pay level.

Ms Leon : Remuneration, access to leave; terms and conditions of employment rather than the duties of the position in terms of advising on economic policy.

Senator FIFIELD: Early, when asked whether he was a member of the Public Service, the answer was 'no'. But, if someone is availing themselves of long-service leave provisions, if they are bound by the APS code, if according to the instrument of appointment their conditions and terms of employment are the same as a departmental secretary, in what sense are they not a public servant?

Ms Leon : A person who is a public servant is employed under the Public Service Act, and he is not.

Senator FIFIELD: Everything else is the same as someone who is employed under the Public Service Act—the terms and conditions, bound by the APS code—

Ms Leon : The Public Service Act encompasses a broad—

Senator Chris Evans: The terms and conditions of remuneration was the point made, and effectively he has

been put on the same salary that was applicable when he was Secretary to the Treasury.

Senator FIFIELD: It says 'terms and conditions of employment', not 'terms and conditions of remuneration'. Is there a departmental secretary who is not a public servant? If the terms and conditions are the same—

Ms Leon : Secretaries are appointed under the Public Service Act.

CHAIR: Senator Fifield, if I could just interrupt for one minute, I would just like to clarify the situation for the media. They cannot go past the desk where the witnesses are. We had a meeting this morning and that was the determination of the committee.

Senator FIFIELD: Ms Leon, let me put the question another way: should Dr Henry be employed under the Public Service Act, given that the instrument of appointment itself says that the terms and conditions of employment should be the same as that of the departmental secretary?

Ms Leon : The Public Service Act is quite a long act. It deals with a broad range of matters. I do not have it here with me but I do not think that everything in that act is encompassed by the phrase 'terms and conditions of employment'.

Senator FIFIELD: Just those bits that would relate to the employment of someone who is a department secretary perhaps.

Ms Leon : In any event, the question you have asked as to whether he should be employed under the Public Service Act is, I think, asking me for an opinion, which, as you would understand, I will not venture upon.

Senator FIFIELD: It is really a matter for the minister.

Ms Leon : Relating to some questions that you asked earlier, I am advised that Dr Henry has agreed to the release of the letter of 4 May, so I will have a copy made available to the committee. I am also advised that the attachment to that letter at the time of his appointment as special adviser indicated that he would be bound by the APS Code of Conduct. So that decision was taken at the time of his appointment.

Senator RYAN: Were there any discussions between Dr Henry and the department or the Prime Minister or anyone in her office regarding his appointment and the terms of that specifically relating to his opportunity for other work, such as other board appointments?

Ms Leon : I think I have already indicated that I would take on notice the question of what discussions were had prior to his appointment. It was not in the Department of the Prime Minister and Cabinet at that time, so I did not have those discussions with Dr Henry. I will take that on notice. I can advise that, at least prior to the announcement of his role in relation to the Asian Century task force, there was discussion with the department about his intentions to be available for other private sector work. We certainly were proceeding in the department on the basis.

Senator RYAN: I am more interested in the discussion we were just having. We have a person appointed by a rarely used section—I believe there have been fewer than 10 in 35 years; I believe he is the seventh appointed to this under 67 of the Constitution, as an adviser in this capacity. I think it would be legitimate to say that, on plain reading, the remuneration and other terms and conditions of employment may preclude an appointment to someone directly under the supervision of the Department of the Treasury and that you are not prepared for a series of questions, which I think were reasonably predictable, to be able to tell us whether the Prime Minister's department or office had discussions with him about a significant appointment. This is a quite strange construction of an advisory role.

Senator Chris Evans: Senator, I do not think you ought to verbal the officer. We took on notice the question of when the discussions occurred. There is no suggestion that there was not a discussion between PM&C regarding Dr Henry's role and the conditions under which that would apply. It stands to reason there had to be a discussion about those things.

Senator RYAN: Does the APS Code of Conduct allow for someone to be appointed to a board of that nature, such as a bank? If I was an APS6 in the Department of the Treasury, would I be allowed to be appointed to the board?

Ms Leon : Dr Henry is not in the Department of the Treasury. I should make that clear.

Senator RYAN: No, but you made the point just then that he is bound by the Australian Public Service Code of Conduct. If I am an employee of the Department of the Treasury as an APS6 level officer, I am bound by the code of conduct. Would that code of conduct restrict me being appointed to the board of a bank?

Ms Leon : It would depend on what your duties were. The requirement in all departments is that officers who wish to engage in other employment should seek approval to do so and need to ensure that there is no conflict between the duties of their employment with the Public Service and the duties that they are proposing to undertake. That is the same whatever level the person is at. I should draw to your attention that the question of Dr Henry being interested in undertaking other work was raised at the time of his appointment. The letter, which I am arranging for you to have a copy of, from the Department of the Prime Minister and Cabinet to advise him of his appointment indicates:

I note that you are interested in undertaking your new duties on a part-time basis so that you have the flexibility to undertake outside employment. I support that proposal. I request that you consult me prior to undertaking outside employment and that you be mindful of any real or perceived conflict of interest.

So the issue was raised at the time of his appointment and it was envisaged at that time that he might undertake other work and, in doing so, that he would need to ensure there was no conflict of interest between that other work and his duties as a special adviser.

Senator RYAN: When did Dr Henry approach the relevant officer, which I assume was the Prime Minister, to seek approval for the appointment to the board of the NAB?

Ms Leon : I do not have the exact date with me, but he did discuss that with the secretary of the department and the Prime Minister before the announcement of his role on the white paper.

Senator RYAN: I would appreciate the date he discussed it with the Prime Minister and/or the Secretary of the department.

Senator ABETZ: I assume we are accepting of the proposition that the Secretary of the Department of the Treasury should not be an executive director or non-executive director of any commercial bank.

Ms Leon : That is not the case here.

Senator Chris Evans: That question is not for the officer to answer.

Senator ABETZ: In the letter that was sent by the department or the Prime Minister to Dr Henry, it says that certain things might be allowed, whereas in the actual instrument of appointment it says:

… the remuneration and other terms and conditions of employment be the same as those that apply to the person who holds the position of Secretary of the Department of Treasury at the relevant time.

So we are now being told that parts of the terms and conditions of employment of the Secretary of the Department of Treasury can now also include sitting on the National Australia Bank board.

Senator Chris Evans: That is clearly a nonsense, Senator. You have sought to join two things together. What is being said is that the conditions of the remuneration package for Mr Henry would be the equivalent of those of the Secretary of Treasury as conducted on a part-time basis. That is the point of reference.

Senator ABETZ: That is not what the instrument says; it says 'the remuneration and other terms and conditions be the same as those that apply'. Nothing could be clearer than that he was to be subjected to all the benefits and, I suggest, also the responsibilities as he would if he were still Secretary of the Department of the Treasury. It seems as though you are now reading it down that he gets all the benefits but none of the responsibilities that go with it.

Ms Leon : Terms and conditions of employment do not mean the duties of employment. He is not performing any of the duties of the Secretary of the Department of Treasury; he receives the same employment terms and conditions. That means pay, leave—the conditions of employment, not the duties of the job. So both he—

Senator ABETZ: Clearly—

CHAIR: Senator Abetz, would you just allow the witness to complete her answer. Thank you.

Ms Leon : Both Dr Henry and the Secretary of the Department of the Treasury undertake, by virtue of their respective positions, not to engage in outside employment which would conflict with their duties. But Dr Henry and the Secretary of the Treasury have quite different duties, so what would be a conflict for one would not be a conflict for the other.

Senator RYAN: Should I take it, then, that the scoping work that is being undertaken for this white paper will involve no work whatsoever on the financial system and banking arrangements of prudential oversight?

Dr de Brouwer : The coverage of the white paper is very broad.

Senator RYAN: I realise that, and we understand that it is being worked on at the moment. But, if Dr Henry is on the board of the NAB and if you saying that there are all these arrangements in place to stop a conflict, surely you have to be saying now that this white paper will include no analysis, comment or advice as regards the financial system or prudential oversight or banking or anything else that potentially NAB is involved in.

Senator Chris Evans: No, what we have indicated is that Dr Henry will be bound by the same code of conduct that applies to public servants, and he has given that undertaking and the letter of appointment from the Prime Minister deals with that question and the question of conflict of interest. Clearly he is bound to make sure that he acts appropriately in terms of any potential conflict of interest.

Senator RYAN: How is it possible for Dr Henry to oversee a project which may or may not, because it is obviously still in its rather embryonic stages, include work on the financial system—presumably a pretty significant aspect of the white paper given our economic engagement in financial services, if nothing else—and not experience a conflict by being on the board of one of our major banks? Or is this something the department has not considered?

Senator Chris Evans: The officers have advised you of what the administrative arrangements are—

Senator RYAN: I am going to the white paper.

Senator Chris Evans: and you are trying to make an argument now. That is your prerogative; that is not a question. We made it clear what the arrangements are in relation to the code of conduct and potential conflicts of interest. They have been agreed with the Prime Minister, they have been set out to the letter of appointment and they are the ones that will apply.

Senator RYAN: No, Senator Evans, that was a question. I am asking now: will you as the minister say that this white paper project, which is still being developed, to avoid the conflict that your officers—as you have mentioned—have outlined, will not include any work on the prudential oversight or financial arrangements we have, given that Dr Henry is obviously conflicted from such policy advice? Or do you not agree that he is conflicted from such policy advice while he was on the board of the NAB?

Senator CHRIS EVANS: That is the point: you expressed an opinion, and I do not agree with that opinion. What we have done—

Senator ABETZ: That is on the Hansard.

Senator CHRIS EVANS: You claim he is conflicted. That is your right; that is not a question to the officers at estimates.

Senator RYAN: It is a question to you.

Senator CHRIS EVANS: But, Senator, I do not share your view.

Senator RYAN: So it is not a reasonable assumption to make—

Senator CHRIS EVANS: You may well be wanting to smear up Dr Henry. That is your business.

Senator RYAN: I am not doing anything of the sort.

CHAIR: You put a question, Senator Ryan. If you allow the minister to complete his answer then you have the right to put another question.

Senator BERNARDI: Chair, the minister is going to make allegations about what Senator Ryan has supposedly done: smearing Dr Henry, which is, I think, completely untrue.

CHAIR: Is no point of order, Senator Bernardi.

Senator BERNARDI: No, but it is completely untrue. I think Senator Ryan is entitled to respond to that. We do not want smears going from one side to the other.

CHAIR: That is right, Senator Bernardi. I have been in the chair all morning, and I will continue to chair the estimates. The question was put to Senator Ryan, and the Minister was in the process of responding. Senator Ryan will have the opportunity to ask another question.

Senator CHRIS EVANS: Madame Chair, we are just making clear that the question of potential conflicts of interest has been dealt with appropriately through the use of the code of conduct—

Senator RYAN: It is just that you can ignore the code.

Senator CHRIS EVANS: and the arrangements entered into between the Department of the Prime Minister and Cabinet and Dr Henry, and I am sure he will act appropriately. Of course, any decision will be a matter for government; the recommendations from his role as an advisor will be considered by government. But the point is that the code of conduct—the appropriate protections regarding conflict of interest—have been put in place.

Senator RYAN: So is it appropriate for Dr Henry to undertake work dealing with prudential oversight of our banks and financial services in Australia and the region as part of this project given his appointment and acceptance of that appointment to the board of the NAB?

Senator CHRIS EVANS: As I have made clear to you, the code of conduct arrangements put in place provide for the proper management of any potential conflicts of interest and Dr Henry informed the PM&C and the Prime Minister of his intention to accept this appointment and, as I say, the appropriate safeguards have been put in place.

Senator RYAN: So what are the safeguards? Take me through how this task force which is yet to be assembled and which is dealing with a project that is yet to be designed and terms of reference that we still have not seen is going to deal with financial services and prudential oversight in a way that avoids the perception of conflict of interest.

Ms Leon : I probably should draw your attention to the Prime Minister's announcement. The Prime Minister's announcement indicates that the paper will consider:

the current and likely future course of economic, political and strategic change in Asia, encompassing China, India, the key ASEAN countries as well as Japan and the Republic of Korea;

the domestic economic and social opportunities and challenges of the Asian Century …

opportunities for a significant deepening of our engagement with Asia across the board, including in the economy, science and technology collaboration, clean energy, education, business-to-business and people-to-people links and culture;

the political and strategic implications of the Asian Century … and

the role of effective economic and political regional and global cooperation.

Senator RYAN: My apologies if I used the incorrect term. It does read like some essay questions I used to answer at uni. It is clear that this project is still undergoing, as you have made clear on numerous occasions, a lot of scoping work in terms of pulling a task force together and its workload, because we do not even know yet how much is going to work over the coming months. My apologies if I used 'terms of reference' out of line, but I would like to know, given that financial services and prudential oversight are clearly part of those terms of reference, how Dr Henry is going to manage any potential, perceived or real conflict of interest in a task force he is leading that deals with those issues.

Ms Leon : I suppose I read those out partly to make the point that the provision of financial services and prudential oversight is not included in any specific way in those much broader terms of reference.

Senator RYAN: I think you would be struggling not to include soccer under those terms of reference—they are so broad—and that is why the department is clearly undergoing a lot of work pulling a task force together. I do not think there is any risk that prudential oversight or financial services could not be included under those terms of reference unless we are being told that that scoping work means that it will not be included in the program.

Senator Chris Evans: What you are being told is that the arrangements that have been put in place to deal with any potential conflicts of interest, or perceptions of conflicts of interest—those are being put in place. I cannot help you with the detail of how Dr Henry and the task force might operate in terms of the specific issues some time down the track, but what you can do is put in place a set of structures. The normal structures that occur in these sorts of circumstances have been put in place and will apply to Dr Henry.

Senator RYAN: The only things in place are the normal structures—is that what you are saying? You cannot give me detail, and I understand that we cannot talk hypothetically. But, Senator Evans, you use the words 'normal structures' there, so the only things put in place are the normal structures—nothing special given his rather unique constitutional method of appointment, nothing special given his appointment to the board of the NAB, just the normal structures that apply to everyone else in the Public Service?

Senator Chris Evans: When I was referring to normal structures I referred to the Code of Conduct, but you are aware of Ms Leon's reference to the specific issue being addressed in correspondence with the Prime Minister—I have not actually seen that letter yet, I do not know if it has come around. I took it from her reading part of it into the Hansard that those issues were directly dealt with in the letter of appointment—is that correct Ms Leon?

Senator Chris Evans: It is the letter advising him of his appointment by the Governor-General.

Dr de Brouwer : I might just add that the terms of reference also explain a variety of governance procedures. Besides the task force itself, which is an across-department task force, there is an advisory board with external advisers and government official advisers; a secretaries' board which oversees some of the work; a cabinet process; and very extensive public consultation. There is quite an extensive and open governance process around the material that is covered by the task force led by Dr Henry.

Senator CORMANN: On the letter to the editor of the Australian Financial Review titled 'Henry's advisory role part-time'and signed by the secretary, what caused the secretary to write that letter? Was it of his own initiative or did that follow an approach by the Prime Minister or her office?

Dr de Brouwer : The secretary normally writes his own letters. I do not know, but we will take that on notice.

Senator CORMANN: Are you saying that the Secretary of the Department of the Prime Minister and Cabinet sent a letter off to a major daily newspaper and none of you at the table actually knows the circumstances in which he came to write that letter?

Dr de Brouwer : I am sorry; both of us were on leave at that time.

Senator CORMANN: It was published today.

Senator Chris Evans: Can we just be clear about which letter we are referring to?

Senator CORMANN: It is a letter published today in the Financial Review titled 'Henry's advisory role part-time' and signed by Ian Watt, Secretary, Department of Prime Minister and Cabinet, Canberra ACT.

Ms Leon : I have just had some advice on the point. The letter by the secretary was written in response to articles in the Financial Review on the previous Saturday. The letter was drafted within the department, after discussions with the secretary, by departmental officers because of the desirability of ensuring that the record was correct as to what Dr Henry's role and duties were. So the letter was drafted in the department, not in the Prime Minister's office or at her direction.

Senator CORMANN: I did not ask whether it was drafted in the Prime Minister's office. It already says in the letter that it was in response to articles by Brian Toohey and John Kehoe, but can you absolutely guarantee that there was no communications between the Prime Minister's office and the Secretary of the Department of the Prime Minister and Cabinet about writing this letter in response to reports in the Financial Review?

Ms Leon : I can advise you that the idea of writing the letter originated in the department.

Senator CORMANN: How often does the secretary of the Prime Minister's department write letters to the editor?

Ms Leon : Whenever it is necessary to correct something at a high level. It is not unusual for a departmental secretary to write a letter to the editor of a newspaper.

Senator CORMANN: It is not unusual for the secretary of the Prime Minister's department to write letters to the editor of a newspaper? I would be interested to get—on notice, not now—examples of previous circumstances where secretaries of the Prime Minister's department have done that.

Ms Leon : I should say that the current Secretary of the Department of the Prime Minister and Cabinet has only been the secretary for a short time—

Senator CORMANN: I understand that.

Ms Leon : so I cannot comment on the practice of this particular secretary over a lengthy period.

Senator CORMANN: In that letter to the editor, the secretary of the Prime Minister's department said that Dr Henry's role:

… is a part-time role for which he will be paid on a pro rata basis.

Looking at the executive council minute formalising his appointment, section 4 says, 'The Prime Minister may agree that the duties of the special advisers are to be performed on a part-time basis,' which seems to suggest that the default position is that he would be expected to work on a full-time basis and that she may agree that he can work on a part-time basis from time to time. They do not seem to be consistent—what is in the letter to the editor and what is in the letter of appointment.

Ms Leon : I am not sure if you have yet received the letter that we were having copied. That was the letter that the then secretary of the department sent to Dr Henry advising him of his appointment. That letter—which was clearly the result of whatever discussions had happened between the Prime Minister, the department and Dr Henry prior to his appointment—indicates, 'I note that you are interested in undertaking your new duties on a part-time basis,' so it was clearly envisaged by all of those involved that the intention was that he would do his work on a part-time basis. The reason the appointment is framed in that way is that one can specify what the rate of pay will be for a full-time position and it can then be pro rata, depending on the level of the part-time work.

Senator CORMANN: This is not the way it is written. I take you to section 3 of that executive council minute, which of course predates the letter to Dr Henry, where it says, 'For any period that the special adviser performs the duties of that office on a full-time basis'—which is said to be 40 hours per week—'the remuneration, other terms and conditions of employment for the special adviser be the same as those that apply to the person who holds the position of Secretary of the Department of the Treasury at the relevant time.' The next paragraph, of course, says, 'The Prime Minister may agree that the duties of the special advisers are to be performed on a part-time basis.' Are you saying that between the time of the executive council passing that minute and the Prime Minister writing a letter to Dr Henry confirming the appointment there was a change in the terms and conditions of—

CHAIR: Just before you answer, can I have a resolution of the Senate committee to table the document that has been referred to, which was to Dr Henry dated 4 May? It is so tabled.

Ms Leon : No, Senator Cormann, there was not a change in the expectations of the parties at the time that the instrument was being prepared. It was the stated desire of Dr Henry that he have available part-time work, and the instrument is drafted so as to facilitate that. But it is normally the practice, when specifying a rate of pay, to specify the full-time rate so that the amount that is paid on a part-time basis is pro rata as against that rate. That is simply the normal way of expressing a base pay point.

Senator CORMANN: But if he works for 40 hours per week he will be paid full-time, effectively.

Ms Leon : If he did.

Senator CORMANN: How does that work in practice? Does Dr Henry have to fill in time sheets like lawyers do and send them in to the department on a regular basis or is there some other arrangement?

Ms Leon : As I have indicated, Dr Henry has not commenced work in the department as yet. Before he does, the department and he will agree on what the required hours are, and Dr Henry, I am sure, will be dutiful about performing those hours.

Senator CORMANN: So you do not envisage that Dr Henry would have to fill in time sheets?

Ms Leon : I think that would be unlikely.

Senator CORMANN: It would be 'unlikely', but—

Senator Chris Evans: Senator, it is not unusual for the hours of chairs of committee inquiries and what have you to vary, and obviously those are agreed, resolved and confirmed between whoever is doing that role and the relevant department. It is a quite normal practice.

Senator CORMANN: Why did you appoint Dr Henry as a special adviser on 27 April 2011 when at this point in time you do not yet seem to know when he is to start work on the white paper? Other people who have chaired task forces of this nature have been appointed through other methods at the time they are actually meant to start work. What is the reason for—

Ms Leon : I think we already canvassed those questions a short time ago.

Senator CORMANN: We might have canvassed them but I did not hear you provide an answer to them.

Ms Leon : I think what I said at the time was that the government was keen to retain the services of Dr Henry from the time that he finished his appointment as Secretary of the Treasury, so it immediately sought to appoint him to a role so that he would be available to them for work as soon as was mutually convenient.

Senator CORMANN: The government wanted to lock him in just in case.

Ms Leon : The government wanted to retain his services as a valued adviser.

Senator CORMANN: Dr Henry is an economist with a decade's experience as head of the Treasury. Back in June, when the Prime Minister announced the fact that he had been appointed, she said she was 'pleased that Dr Henry's extensive knowledge and experience remains available to the government'. Why is the government not using his economic expertise but rather has asked him to perform a role in an area where he has comparatively less knowledge and less experience?

Senator Chris Evans: He is a former Secretary of the Treasury with a wide set of interests. We have a very important white paper to develop and the government took the view that he was an appropriate person to conduct that. He will obviously have access to departmental staff and other expertise, but I think he is a perfectly appropriate appointment and I have not seen his competence for the job questioned anywhere.

Senator CORMANN: I am sure that if Dr Henry had been asked by the Prime Minister to chair a white paper process in relation to Australia's engagement with Asia he would have agreed to that outside of having been appointed a special adviser back on 27 April 2011. I do not think there is a satisfactory explanation as to why you would appoint him as a special adviser on 27 April without him effectively doing anything for five months and still not have a specified date on which he is supposed to start and then have him work in an area where he does not have direct expertise. I am just trying to understand what the government's—

Senator Chris Evans: I will take that as the expression of your opinion.

Senator CORMANN: I am trying to understand the government's thought processes in relation to that. So Dr Henry's involvement with the tax forum was entirely on his own time, was it? It had nothing to do with his role as a special adviser to the Prime Minister?

Dr de Brouwer : That is right.

Senator CORMANN: That was entirely on his own time—or was that part of his—

Ms Leon : That was on his own time.

Dr de Brouwer : was not related to his task as a special adviser to the Prime Minister.

Senator CORMANN: You have gone through the APS guidelines with my colleague. What you are saying is that here today you are not able to tell us what the pro rata basis is going to be—

Ms Leon : I have had a discussion with Dr Henry to the effect that both he and the department anticipate that the work required will be in the vicinity of one or two days per week, but whether that is one day every week or one day some weeks and three days another week it is not necessary to determine at this stage.

Senator Chris Evans: It stands to reason that there will be some travel to Asia required, and he will be full time while he is visiting Asian regions discussing their perspectives. So the hours will be variable. But you are aware of the arrangements which will apply.

Senator CORMANN: You say it will be variable. But he is not going to fill in any timesheets and there will be a set arrangement. Will it be averaged over a year on the basis of two days a week or will it be: 'You tell us every week how many days you've worked on this white paper process and then we'll pay you full-time or part-time'? Is it going to be ad hoc, or is it going to be—

Ms Leon : I anticipate that we will agree with Dr Henry, once the task force is up and running, the amount of days a week which he will be expected to average over the time of the task force.

Senator CORMANN: On average. So in practice you will effectively have a dollar amount per year that is going to be on the table?

Ms Leon : I anticipate that we will reach an agreement with Dr Henry about his average hours. As I said, he has not commenced work as yet so that has not been finalised.

Senator CORMANN: Just to finalise—

CHAIR: We are going to move on. This is your last question. I did warn you, Senator Cormann.

Senator CORMANN: Dr Henry is currently still on leave. You indicated before that he could have been available earlier if he had been required earlier. Is there an anticipated date of starting? For how long does Dr Henry's leave still run? What is the anticipated day that he would be expected to start in his role?

Ms Leon : I do not have an exact date yet but I imagine it would be in the near future.

Senator CORMANN: In the fullness of time!

Senator Chris Evans: He is expected to start shortly, Senator.

Senator CORMANN: In the fullness of time, when it is all said and done!

Senator Chris Evans: Shortly. You will be the first to know. I will give you a call.

CHAIR: Before we move on to Senator Rhiannon, there is a second document. It is to Mr Paul Bailey. It is a copy going to the Australian Financial Review. Is it acceptable to the committee to table that document? It is, so we will circulate that document.

Senator RHIANNON: Senator Evans, what role does the Department of Prime Minister and Cabinet play in the appointment of high commissioners?

Senator Chris Evans: You have got me, Senator! I will turn to the departmental officials to provide advice. I am not sure if they do play a role at all.

CHAIR: Could I just clarify, Senator Rhiannon. What we are doing is asking general questions at this point in time and then we will proceed to the outcomes. We are not going to jump around. I was under the understanding that you were going to ask a general question.

Senator RHIANNON: I see. No, it is not a general question. I have fairly specific questions.

CHAIR: They are dealing with the outcomes, so we will come back to you.

Senator Chris Evans: We would take a couple of minutes to get the right person. So we will come back to that if it is okay.

CHAIR: We have already made the decision that we will not be jumping around the program. Quite rightly that was pointed out to me. We are going back to Senator Ryan. We will come back to you, Senator Rhiannon, when we get to the appropriate outcome.

Senator RYAN: Just to clarify, Ms Leon, no payments have been made to Dr Henry yet?

Ms Leon : In relation to his role as special advisor, no.

Senator RYAN: And in relation to his payout from the Department of the Treasury, he has accrued long service leave?

Ms Leon : His leave was accrued during his time at the Treasury but his accrued leave entitlements have been transferred onto the books of the Department of the Prime Minister and Cabinet. So that is where it is coming from now.

Senator RYAN: So you are paying him at the moment, it is just as long service leave rather than for special advisor.

Ms Leon : That is right. We are paying him out of his accrued leave entitlements. That is correct.

Senator RYAN: If the Remuneration Tribunal increases the salary to the Secretary of the Department of the Treasury, that presumably means that the pro-rata salary, whatever it may be, for Dr Henry will also increase?

Ms Leon : His appointment links his pay to the Secretary of Treasury.

Senator RYAN: Okay. Just checking. Did Dr Henry consult with the Prime Minister about his appointment to the SMART Infrastructure group?

Ms Leon : He certainly consulted with the department. I just do not have with me whether he also consulted with the Prime Minister. I can take that on notice.

Senator RYAN: Within the terms of the letter that was just tabled, would it be normal for him to solely consult with the Secretary of the Department of the Prime Minister or does he have to consult with the Prime Minister on every occasion?

Ms Leon : It would normally be sufficient for him to consult with the secretary of the department. Obviously the secretary, if he thought that any proposed appointment raised some significant issue, might suggest that he discuss it with Prime Minister. That has not been occasioned by any of the appointments of which we have been advised to date.

Senator RYAN: I would appreciate any advice on whether any conditions have been imposed upon accepting any appointment, by the secretary of the department or the Prime Minister. I am not saying that there have been. If there have been conditions imposed—

Senator Chris Evans: We will take the question on notice.

Senator RYAN: Does this method of appointment of Dr Henry preclude him appearing before parliamentary committees in any way? Does a parliamentary committee have the capacity to call Dr Henry to appear? He is not an officer of the APS but he is bound by the APS code of conduct. I am just trying to fit him in.

Senator CHRIS EVANS: You mean in his role as--

Senator RYAN: In his role as a special advisor to the Prime Minister.

Senator Chris Evans: advisor under section 67 of the Constitution? Do you have any advice on that Ms Leon?

Ms Leon : I would have to take that on notice.

Senator RYAN: I would appreciate it, if you have taken advice on that, who the advice was sought from and what the advice is.

Ms Leon : I can tell you now that I have not up until this point sought advice on it but I am happy to take the question on notice.

Senator RYAN: I would also be interested in whether the Prime Minister's office has sought advice on that point.

Ms Leon : I am not aware of any such advice having been sought but I am happy to take some advice and get back to the committee.

Senator RYAN: I referred to a parliamentary committee there. Also whether or not similar restrictions would apply to him appearing before estimates hearings if there was something to do with the white paper, which there may be next year, for example.

Ms Leon : I am happy to take that on notice.

Senator ABETZ: Continuing on the issue of Dr Henry's appointment, just so we do not go around in circles further, can you please table for us on notice the exact remuneration and other terms and conditions of employment for the position of the Secretary of the Department of Treasury, all of them, and then tell us how the appointment of Dr Henry varies from that?

Ms Leon : Yes, Senator. I should say if there are any conditions that the current occupant of the secretary position have that had been agreed with him personally but are not attached to the position then they would not be included in any such provision of information.

Senator ABETZ: I would accept that. I appreciate the government's use of individual flexibility agreements. In Dr Henry's situation they seem very flexible. The next issue I want to canvass is that one assumes that all departmental secretaries, especially the departmental secretary of Treasury, might just put in more than 40 hours per week.

Senator Chris Evans: I certainly hope so.

Senator ABETZ: Yes, one would hope so.

Ms Leon : That is certainly my experience.

Senator ABETZ: We are told in the instrument of appointment that the special adviser, Dr Henry, will be paid at the remuneration rate of the secretary on the basis of 40 hours per week, which suggests he will now be paid at an even higher remuneration per hour than he did whilst he was secretary of the department. How did we calculate that and why did we hit on 40 hours per week as being a full-time basis?

Senator Chris Evans: I think it is rather a long bow. They specified 40 hours representing a full-time appointment. You are right to say that senior public servants, despite technically being employed for 40 hours a week, work a lot more, like you and I and the other officers of the department. But for the purpose of calculating salary that is obviously the basis on which it is done. I am sure the remuneration of Dr Henry will reflect the very significant workload he is used to working and the calculation will be based on probably the number of days a week. I suspect many days Dr Henry will be working more than a standard eight-hour day when he does that. But it is the normal arrangement made for chairs, people heading commissions of inquiry et cetera, just normal practice, as you well know.

Senator ABETZ: It is not normal practice to link somebody's salary or remuneration to that of the secretary of a department. If it is normal practice, Minister, possibly you could take on notice how many people have been so appointed. It is a nonsense, with respect, what you have said. Take that on notice and we will see who is right.

Senator Chris Evans: You can keep on pushing this but, quite frankly, you understand the basis on which Dr Henry is appointed. It has been made public. He will be remunerated for the hours he works under the normal circumstances.

Ms Leon : Senator, in relation to the question you asked me a moment ago on notice about terms and conditions, I can advise that the determination that sets secretaries' pay and conditions is on the Department of the Prime Minister and Cabinet website.

Senator ABETZ: Yes, and if you can set that out for us and then tell us how the appointment of Dr Henry is not the same. The instrument appointing him says it is the same, and when I tried to take you through the terms and conditions you told me it was not the same. So I want to know what aspects are not the same—like provision of a car, entitlement to a car and all those other terms and conditions.

Senator Chris Evans: We have taken it on notice, Senator.

Senator ABETZ: Thank you. In relation to the standard of ministerial ethics, we are told about post-ministerial employment. Ministers are required to undertake that, for an 18-month period after ceasing to be minister, they will not lobby, advocate or have business meetings with members—and so it goes on. I am just wondering: did it cross the government's mind that here we had somebody who was leaving the head of Treasury and was now embarking, within a matter of about six months, on a commercial venture with the National Australia Bank and that it might potentially be covered by the same considerations—albeit I accept he is not a minister of the crown. But one would imagine that all the reasons for this code being implemented for ministers might have applied also to heads of Treasury taking detailed financial advice for the benefit of commercial enterprises, namely a bank.

Senator Chris Evans: Senator, the question is totally hypothetical. You are asking us to answer the question, 'should the ministerial code of conduct be applied to senior public servants?' No, it is a ministerial code of conduct.

Senator ABETZ: We know that, but it is the question of the ethical considerations—

Senator Chris Evans: But you asked me whether—

Senator ABETZ: That is a very schoolboy debating tactic and I said—

Senator Chris Evans: The answer is no.

Senator ABETZ: and I said that I accepted that this was a ministerial code and that if this is an important matter of ethics and consideration, one wonders why it would not apply to somebody who might get even more detailed knowledge on these matters by being department head as opposed to, let's say, the Treasurer himself.

Senator Chris Evans: The question is: do we think the ministerial code ought to be applied to senior public servants. The answer is no.

Senator ABETZ: No, I did not ask that. Do the principles apply?

Senator Chris Evans: That is a question of opinion about which principles ought to apply to a different set of people.

Senator ABETZ: No. Did it cross the government's mind, in its discussions with Dr Henry, that these matters might arise? There was clearly a discussion about him taking on this extra role with the National Australia Bank. That has been let in evidence. I just want to know whether it was canvassed with him that there might be a genuine conflict of interest which his Treasurer would not be allowed to do, yet the head of the Treasury would be allowed to do under these standards.

Senator Chris Evans: Senator, we have taken you through the arrangements in terms of the code of conduct and the way potential conflicts of interest will be dealt with. It has been set out in the terms of the letter confirming the appointment. We have been through that. Those are the conditions that apply to Dr Henry.

Senator ABETZ: So if you are a mate you are okay. If I may ask: where should I be raising questions about the intergovernmental agreement on forestry? If it is 'general' that is fine.

CHAIR: We will seek some advice for you and while we are doing that we will go to Senator Faulkner.

Senator Chris Evans: We will just find the relative section for you, Senator.

Senator FAULKNER: I wanted to ask some questions in relation to the Office of the Commonwealth Ombudsman. First of all would you, Minister, or one of the officers at the table explain the ministerial arrangements in relation to the Ombudsman. Who is the responsible minister?

Ms Leon : The Special Minister of State.

Senator FAULKNER: What portfolio is the Ombudsman's office within?

Ms Leon : This portfolio.

Senator FAULKNER: There has been quite a lot of publicity in the last week or so about the Ombudsman in relation to the provision of questions. You would be aware of this, would you not?

Ms Leon : Yes, Senator.

Senator FAULKNER: I wondered whether there had been any contact by any officer of the Department of the Prime Minister and Cabinet with the Ombudsman as a result of the publicity around those issues.

Ms Leon : There has been some contact between the Office of the Commonwealth Ombudsman and the department. The Office of the Ombudsman advised the department towards the end of September about the question on notice from the committee, the answers to which have led to the recent media publicity to which you refer. So the Office of the Ombudsman contacted the department to advise us of the question and to provide us in advance with a copy of the documents that would be provided in answer to that question. The secretary of the department is due to meet the Ombudsman tomorrow. It is a meeting that had already been scheduled as part of the new secretary's round of meetings with statutory office holders and agency heads within his new portfolio.

Senator FAULKNER: Let us put Dr Watt's meeting with the Ombudsman aside for a moment. The Ombudsman himself, as a result of the question on notice, took the initiative of contacting PM&C in relation to the questions on notice and effectively how they were going to be responded to.

Ms Leon : I understand that the Ombudsman himself was overseas at the time but his office contacted the department.

Senator FAULKNER: The Office of the Ombudsman contacted PM&C.

Ms Leon : And I am also advised that the secretary of the department, Dr Watt, had a telephone conversation with the Ombudsman on Friday just passed.

Senator FAULKNER: About this matter?

Ms Leon : Yes.

Senator FAULKNER: So the Office of the Ombudsman contacted PM&C about questions that had been placed on notice. Were the draft answers to the questions on notice provided to the Department of the Prime Minister and Cabinet?

Ms Leon : The question on notice sought copies of communication, so in that sense they were not draft answers to questions; they were copies of the documents that the Office of the Ombudsman intended to provide to the committee in answer to the question. They were copies of all the documents that fell within the scope of that request. They provided us with copies of those.

Senator FAULKNER: I suppose that is a matter for interpretation, but I do appreciate the point that you make. Was all the material that was provided in answer to the question on notice provided to the Department of the Prime Minister and Cabinet?

Ms Leon : In advance, yes.

Senator FAULKNER: Can you say when, please? Let me be a little clearer: not when it was provided by the Ombudsman's office but when it was received by the Department of the Prime Minister and Cabinet. I think that is really all I can ask you.

Ms Leon : I think it was on 30 September—either the 29th or 30th. I can take that exact date on notice.

Senator FAULKNER: Are you aware—and you may not be—of when that same information was provided to the committee?

Ms Leon : I believe that it was provided later that same day, but I would not be certain of that since I was relying only on advice of the Office of the Ombudsman that it was their intention to provide it later that day.

Senator FAULKNER: Thank you for that. Did anyone in the department take any action as a result of receiving that documentation and/or prospective answer to the question on notice?

Ms Leon : I received the documentation and I informed the secretary of the department of the nature of the question and the documents that were to be tabled in response to the question.

Senator FAULKNER: Thank you for that, and are you aware that any other action apart from that was undertaken?

Ms Leon : The department provided a briefing about the matter to the Prime Minister early the following week—

Senator FAULKNER: Obviously, I was not aware of that but I would expect that to occur. I would be very disappointed if that—

Ms Leon : The normal processes of government applied. We also prepared question time briefs on the subject for the following week.

Senator FAULKNER: And the secretary of the department contacted the Ombudsman last Friday—what would that be—the 13th or 14th? The 14th.

Ms Leon : The week when the material was first provided to us was towards the end of the week immediately prior to the tax summit and the job summit, and so both the secretary and the Ombudsman were fairly unavailable in that following week.

Senator FAULKNER: Say that again, sorry:

Ms Leon : The week immediately after the initial information was the week of the tax summit and the job summit so the secretary of the department was—

Senator FAULKNER: Rather busy.

Ms Leon : rather unavailable—

Senator FAULKNER: Rather unavailable; sorry, I did not pick up the word.

Ms Leon : due to meetings in that week so he had a discussion with the Ombudsman by telephone in the following week, and I understand he is scheduled to meet the Ombudsman tomorrow.

Senator FAULKNER: Are you able to share at all with us—you may not be able to of course—anything in relation to the telephonic communication?

Ms Leon : No, I was not present for that conversation.

Senator FAULKNER: I think from this committee's perspective—I do not know about any other senators—if there are any senators other than myself who are keen to progress this issue we will probably do so directly with the Ombudsman. But what I would appreciate knowing and understanding, if you are able to assist me, as obviously reading this information in broad measure I think it is fair to describe these matters as going to resourcing issues or budget issues in relation to the Ombudsman's office. If I had to distil it and give it—

Ms Leon : The material that was provided in the documentation that the Ombudsman released in answer to the question on notice went partially to budgetary issues and partially to other issues of migration, defence and taxation.

Senator FAULKNER: My general question to PM&C is: did the Ombudsman or the Ombudsman's office raise any questions of that nature, including issues relating to budget issues with the Ombudsman's office or resource issues with the budget with the Ombudsman's office with the department of PM&C?

Ms Leon : I might get some advice on that but, while I am seeking that, I should perhaps take the opportunity to let you know about some of the budgetary measures that have affected the Ombudsman's office. Over the last few years, the Ombudsman has had increases in remuneration in resourcing for a wide range of additional responsibilities. In relation to the Palmer and Comrie reports, the Ombudsman received $4 million a year roughly over a four-year period. Several years later the Ombudsman received additional resourcing in the vicinity of $1.3 million a year over four years. When the additional functions of the Ombudsman having to undertake reviews of people who had been in detention for longer than two years were introduced, the Ombudsman received additional resourcing of about a million dollars a year over four years. The measures in the Northern Territory have led to a range of additional budget measures for the Ombudsman. Improvements to the non-statutory refugee assessment process also delivered additional resources to the Ombudsman over four years starting from 2008-09. Norfolk Island governance, which provided additional responsibilities to the Ombudsman, was also resourced over four years from 2009-10, and whistleblower legislation was resourced for half a million dollars a year starting from 2010-11. So the only year in which the Ombudsman had to absorb some additional work by finding offsets within the office of the Ombudsman was in the immediate past budget, a budget in which, I am sure, many areas of the Public Service experienced a similar requirement to offset their new spends with offsets from within their own portfolio. But I will just see if I can get you some advice about whether the concerns about the budget were raised directly with us.

Senator FAULKNER: I do appreciate you providing that information; it is helpful to know and I am pleased it is on the record. But it is not what I asked you.

Ms Leon : I am advised that the Ombudsman's office has raised budgetary pressures with PM&C from time to time. For instance, during the most recent 2010-11 budget process, which is the one in which I said the Ombudsman did have to find offsets for some additional resource requirements, there was a discussion with the Ombudsman's office during that process about what their resourcing requirements would be and the impact on their work of having to offset that.

Senator FAULKNER: Can you provide any more detail, other than that, for our information? In other words, what—

Ms Leon : What form the conversation took?

Senator FAULKNER: Yes.

Ms Leon : I would have to take that on notice, as to whether it was an oral or a written conversation.

Senator FAULKNER: But its timing? You said 'from time to time'; that is my recollection.

Ms Leon : We could provide details of the timing of the discussion with the department.

Senator FAULKNER: That would be of some help in trying to understand the background to these matters. Has the department taken the view that there has been any damage to the status or the effectiveness of the office of the Ombudsman or more broadly to the department or the portfolio as a result of this?

Ms Leon : I do not think it is up to the department to express a view about that. Obviously, we, in general, would say that the community is entitled to expect high standards of conduct from all its statutory office holders, including the Ombudsman, and to be confident that there will be a demonstration of professionalism and integrity in all of their dealings with their constituents and with parliament.

Senator FAULKNER: I appreciate that most of the questions at this committee, as I have said before, will be directed to the Ombudsman, but I am trying to understand, as PM&C is the pre-eminent government department and does take a role in these matters—well, would you acknowledge that the Department of the Prime Minister and Cabinet has a crucial role in terms of ensuring that there are constructive and trusting relationships between agencies and departments?

Ms Leon : Yes, we certainly seek to set in place arrangements that would be conducive to that sort of relationship.

Senator FAULKNER: And that is the spirit in which I am asking that previous question, which I am sure you will appreciate.

Ms Leon : I understand that. It may well be that those matters are matters that are discussed with the Ombudsman in due course.

Senator FAULKNER: It may be, but—

Senator Chris Evans: I make the point that the Prime Minister has expressed concern to the Secretary of the Department of Prime Minister and Cabinet about this matter. I share that concern. I think it is a very serious matter and has the potential to undermine confidence in the office.

Senator FAULKNER: Yes. Senator Evans, while I had not been aware of your own attitude—I had not seen that in the media—I have certainly seen the Prime Minister's concerns represented. I am exploring here in general questions before this department, and I do not intend to do this at any length, trying to get an understanding of what, if any, action the Department of Prime Minister and Cabinet has taken. As a result of your intervention, particularly given the request that the Prime Minister has made of the department, which you have just outlined, I suppose I am really limiting my questions here to that aspect. I will be interested in asking some questions to the Ombudsman later and it is even possible some other senators will want to ask him some questions. I wonder if I am likely to get a response to that.

Ms Leon : What was the question, senator? I thought I had answered your question.

Senator FAULKNER: Given that the Prime Minister has raised these concerns with the department, and I was not specifically aware of that taking place, I was making the point that I was aware of the Prime Minister's concerns because that has been in the media. Is anyone able to indicate beyond what has been said whether there has been any follow-up to that request by the Prime Minister to her own department beyond what we know? I appreciate Dr Watt will be meeting the Ombudsman tomorrow. Effectively, is that the response?

Ms Leon : I do not have anything to add at this stage.

Senator CORMANN: I have a couple of quick questions in relation to the costing of Green and Independent policies. How much time has the department spent since September 2010 in dealing with the consideration of policies for the Independents and the Greens, as per agreements made with them by the Prime Minister and the Treasurer in order to obtain their support to form government?

Mr Hazlehurst : I would have to take that question on notice.

Senator CORMANN: So you do not keep a running tally?

Mr Hazlehurst : I do not have information on that here today and I certainly do not have a running tally of the hours that it has taken.

Senator CORMANN: So it is that extensive that you do not know off the top of your head?

Mr Hazlehurst : No, I do not know off the top of my head.

Senator CORMANN: You are able to take it on notice. Are there people in the department whose role is to wholly or predominately deal with these sorts of interactions with the Independents and the Greens?

Mr Hazlehurst : The role of the Prime Minister's Department in this respect is more to liaise with the Treasury and the Department of Finance and Deregulation on those costing requests. They are carried out within the Treasury and the Department of Finance and Deregulation.

Senator CORMANN: Are there any people within the Prime Minister's Department whose job is either wholly or predominantly to do the liaison in relation to these sorts of requests?

Mr Hazlehurst : It is not their whole job, no. They are staff employed in the Fiscal and Taxation Policy branch.

Senator CORMANN: Would you be able on notice to tell us how many person-hours have been incurred since September last year and what the cost has been for your department since then?

Mr Hazlehurst : I am not certain I will be able to do it quite like that because I am not sure we will have kept an hourly record of the work that has been undertaken on those matters. It is not something that we keep a time sheet on.

Senator CORMANN: So you do not keep track of how much that particular liaison work is costing your department? You do not keep track of how much work is involved?

Mr Hazlehurst : No. It is part of the general business of the department, liaising with other central agencies on the operations of budget and other related matters.

Senator CORMANN: How many people are partly involved in dealing with this?

Mr Hazlehurst : It could be any one of the members of the Fiscal and Taxation Policy Branch, which is about 10 people.

Senator CORMANN: Who is the officer in the department who is primarily responsible for dealing with these sorts of interactions? Is it the head of that branch?

Mr Hazlehurst : Yes, and myself.

Senator CORMANN: And yourself?

Mr Hazlehurst : Being responsible for it, yes.

Senator CORMANN: Are there any protocols in relation to how the process operates? Can a staff member of Mr Oakeshott or Mr Windsor ring the Prime Minister's department?

Mr Hazlehurst : No, no, liaison does not occur directly with the department; the liaison occurs with the Prime Minister's office. Communications then occur between the department and the Department of Finance and Deregulation and Department of the Treasury, including also with the ministerial offices of those departments.

Senator CORMANN: But within the department you are the ultimate person responsible for the direct liaison?

Mr Hazlehurst : The liaison with the other departments?

Senator CORMANN: No, no, liaison with the Independents and Greens.

Mr Hazlehurst : No, that happens—

Senator CORMANN: It all goes straight back through the Prime Minister's office?

Mr Hazlehurst : That is correct.

Senator CORMANN: The liaison into the Prime Minister's Office goes through you or does that go through the secretary?

Mr Hazlehurst : It does not go through the secretary.

Senator CORMANN: So it goes through you?

Mr Hazlehurst : Yes.

Senator CORMANN: You are at assistant secretary level, is that right?

Mr Hazlehurst : First assistant secretary.

Senator CORMANN: First assistant secretary, sorry.

Senator Chris Evans: He was stolen from DEEWR, and we are very unhappy about it.

Senator CORMANN: Can you tell us how many policies have been considered or costed as part of this process so far?

Mr Hazlehurst : I do not have that information, but we should be able to get that by the end of the day.

Senator CORMANN: By the end of today?

Mr Hazlehurst : Yes.

Senator CORMANN: If you could get it to us by the end of the day, could you break it down for us between how many policies have been considered for each one of the Independents or the Greens, I would be very grateful.

Mr Hazlehurst : I will certainly see what we can do.

Senator ABETZ: Can you tell us in what policy area?

Mr Hazlehurst : I believe so. I will see what information we can get first.

Senator CORMANN: In terms of some of the other questions that you have taken notice today, to the extent that you can assist us by the end of the day, obviously that would be much appreciated. I am sure that you will make your best endeavours. Thank you.

CHAIR: We have a couple of minutes before we go to the afternoon break. Senator Ronaldson.

Senator RONALDSON: Very quickly, I just need to find out whether the Prime Minister has engaged the services of a company called Image Media Services and whether Mr Mike Macnamara has provided the Prime Minister with image coaching, as reported in the Daily Telegraph on 17 September. Is that correct?

Ms Leon : The department has not engaged any image media consulting, no.

Senator RONALDSON: Minister, has the Prime Minister or the Labor Party engaged Image Media Services and Mr Macnamara to provide the Prime Minister with some media training?

Senator Chris Evans: I am not sure it is within the purview of estimates, but I understand the ALP has contracted the party, that firm, for some services. But there has been no contract, as I understand it, with any—

Senator RONALDSON: So the Labor Party has actually paid for Image Media Services and Mike Macnamara to provide the Prime Minister with some media training? Is that what you are saying?

Senator Chris Evans: I am not sure what that arrangement is other than I understand there was some publicity around this matter and the advice I have received is that there was no public funds involved but that the Labor Party has had some contractual relationship with Image Media Services. I do not have the details.

Senator RONALDSON: What were the deficiencies that your polling showed up that needed to be addressed by Mr Macnamara?

Senator Chris Evans: Nice try, Senator!

Senator RONALDSON: So you just went and did it for the sake of it. It would not be that, on the back of one of your MPs I think you told the Tele, and I quote:

On TV and in the public she comes across as stilted and wooden when she gives speeches.

I mean, you just don't go and spend money on Mark Macnamara without any reason. What were they?

Senator Chris Evans: The difference between us and the Liberal Party is we actually declare it. But, as you know, in Victoria that is not a habit that the Victorian Liberal Party has got into.

Senator RYAN: We will get to that, Senator Evans.

CHAIR: I just remind everyone—

Senator Ryan interjecting

CHAIR: Senator Ryan! I just remind people that we are due to go to a break, and I think now would be a good time to go for a break.

Proceedings suspended from 15:45 to 16:02

Senator RONALDSON: Minister, was there an amount paid by the Labor Party to Image Media Services?

Senator Chris Evans: I do not know and if I did I would not tell you.

Senator RONALDSON: What other image and/or media consultants has the Prime Minister engaged, either via the department or through the Labor Party?

Senator Chris Evans: At Senate estimates it is appropriate for PM&C to assist you if anyone has been engaged through PM&C. Obviously that is not true of any issue of the Labor Party, but I will ask officers to answer the question. We have established there were none for the firm called Image Media Services, but I will ask Ms Leon to advise whether any were contracted.

Ms Leon : There have not been any image or media consultants for the Prime Minister paid for by the department.

Senator RONALDSON: Have any other ministers been paid for by the department?

Ms Leon : Not that I am aware of, no.

Senator RONALDSON: Will you take that on notice?

Ms Leon : Yes.

Senator RYAN: All expenses for the Prime Minister's office are covered by the department, aren't they?

Ms Leon : The ministerial advisers are paid out of the Department of Finance and Deregulation.

Senator RYAN: And you are not aware of—

Ms Leon : We do not pay for those; we pay for the departmental liaison officers and for the running costs of the office stationery and the like.

Senator RYAN: So someone who is contracted as a speech writer would be paid for by you or by the department of finance?

Ms Leon : If they were contracted by the department they would be paid for by us. If they were contracted by the party, the Labor Party, they obviously would not be.

Senator RYAN: No. Do you have any external consultancies or personal services contracts provided to the Prime Minister by the Department of Prime Minister and Cabinet in the nature of stylists, a speech writer, a gag writer or some such to assist with speeches or any similar services? I would ask you to take the broadest possible definition of similar services.

Ms Leon : The department employs a number of people in the department who write a broad range of speeches and similar talking points for the purposes of speeches for the Prime Minister and for other portfolio members. We have two staff members whose specialty is as speech writers and from time to time we do, if we have a lot of speeches or speeches that we need some help with, get additional external speech writers in.

Senator RYAN: Could you provide on notice, if you do not have the information there, if any non-APS personnel have been contracted to perform speech-writing services over the past 12 months or at the moment?

Ms Leon : I would have to take that on notice.

Senator RYAN: So there is no one who is being contracted and paid for by the department in the nature of a gag writer, a less formal speech writer, or stylists or anything of that nature.

Ms Leon : I am not aware that we have ever employed a stylist.

Senator RYAN: I understand the employment but I am also checking up if there has been a contract for any of these services.

Ms Leon : I would have to take that on notice.

Senator Chris Evans: The officer will take on notice the contracts of people who assist in speech-making type functions and we will give you the list of contacts.

Senator RYAN: I am also interested in whether there are any other services of the nature that I mentioned.

Senator Chris Evans: I am not even sure what a stylist is—maybe that is reflected in the way I dress!

Senator RYAN: I clearly do not have one myself!

Senator Chris Evans: Do you mean a clothes stylist type thing?

Senator RYAN: A clothes stylist, hairdresser—presentation. Voice training is another service that might be utilised.

CHAIR: A wine adviser—like the former Prime Minister.

Senator BERNARDI: That is not a stylist.

Senator RYAN: No, that is not a stylist.

CHAIR: No, but it is a wine adviser.

Ms Leon : I will take that on notice.

Senator Chris Evans: We will take the question in the broadest possible terms.

Senator RYAN: That is what I am after.

Senator RONALDSON: I ask the officers at the table or the minister this question. I understand from an article in the Australian on 3 October, written by Peter Wilson, that the South Australian government's thinker-in-residence—probably one of the loneliest jobs, I would have thought—John McTernan, has been offered a job in the Prime Minister's office. Is that correct?

Ms Leon : I think I said that the employment of staff other than DLOs in the Prime Minister's office is paid for by the Department of Finance and Deregulation, so we do not employ the advisers.

Senator RONALDSON: Are you aware that John McTernan has been offered a job in the Prime Minister's office?

Senator Chris Evans: As I understand—this is on the public record—that he is going to take up a job in the Prime Minister's office in about a month, I think.

Senator RONALDSON: What will his title be?

Senator Chris Evans: I think it is director of communications.

Senator RONALDSON: Director of communications. That will be very interesting, given his past. Will he be employed under MOPS or the Public Service Act?

Ms Leon : He would be employed under MOPS.

Senator RONALDSON: What will his salary be?

Ms Leon : MOPS is administered by the Department of Finance and Deregulation.

Senator RONALDSON: Minister, do you know what his salary is?

Senator Chris Evans: No, I do not. We will take that on notice, or you can ask MOPS.

Senator RONALDSON: I want to highlight something that Mr McTernan said on Twitter, quoting a fictional character after he is given a job at the Prime Minister's office. He tweeted:

I'm sensing a change in management styles. From touchy-feely to smashy-testes.

Were you aware of that? This is the gentleman who also wrote in the London Daily Telegraph, in July:

… all governments need head-kickers: in their cabinets, on their backbenches, and in their offices.

Has Mr McTernan been brought in to be a headkicker?

Senator Chris Evans: I have never met him, so I cannot help you there. To the best of my knowledge I have never met him. Your contribution confirms for me the sense in not tweeting.

Senator RONALDSON: So who does the Prime Minister think needs head-kicking? Is it the foreign minister or the member for Dobell?

Senator Chris Evans: Maybe me, Senator! I do not know.

Senator RONALDSON: It is probably a bit late for you, regrettably, Minister, but there is still some hope for the other two. Is it likely to be them?

Senator Chris Evans: As I understand it, he will be employed as a director of communications.

Senator RONALDSON: Do you think it is appropriate for a director of communications in the Prime Minister's office to have been quoted in the London Daily Telegraph again where he said:

The key is to realise that you don't need to tell the whole truth ...

Is that going to be the bona fides that he brings to the Prime Minister's office in this new role?

Senator Chris Evans: I have never heard of that before. I do not know whether it is accurate and I do not know the context in which it was made, so I cannot help you.

Senator RONALDSON: Just quickly, what does Mr McTiernan bring to the job that was not available elsewhere, given that he was a thinker in residence in his previous employment? It is a significant step up from a thinker in residence in the South Australian government to the director of communications, isn't it?

Senator Chris Evans: Some people would regard it as a step down, I would have thought—from getting paid to think. Whoever is director of communications will be working damn hard. He has obviously had wide experience, including in communications, so he is employed in that capacity by the Prime Minister.

Senator RONALDSON: Has the Labor Party polling again shown that the Prime Minister needs to change her public approach that would require her to have image work done by Mark McNamara and bringing in someone who thinks that her management style is poor and she needs to go from touchy-feely to smashing testes? What is driving these appointments in the Prime Minister's office? Is it just complete and utter desperation? What is driving this?

Senator Chris Evans: Senator, that is one of your worst efforts for a while. I think you will need to fire up if you are going to get a grab out of that. This gentleman has been employed as a communications director. That is the job he will be doing.

Senator RONALDSON: Who has got that job at the moment?

Senator Chris Evans: I am not actually sure who is in that position. I will have to take that on notice.

Senator RONALDSON: Or is it a created job?

Senator Chris Evans: As I said, I will have to take that on notice. In terms of the title, I am not—

Senator RONALDSON: The officers at the table would surely know whether there is a director of communications in the Prime Minister's office. Is there someone there at the moment?

Ms Leon : The ministerial advisory staff are paid for by the Department of Finance and Deregulation, so it would probably be best to take that up with—

Senator RONALDSON: I made it quite clear: is there a person in the Prime Minister's office at the moment with the title: Director of Communications?

Ms Leon : I just do not have the structure chart with me at the moment, so we will have to take that on notice.

Senator RONALDSON: With the greatest respect, you must know. It is PM&C. You must know whether there is a director of communications in the Prime Minister's office, for goodness sake.

Ms Leon : There is a communications unit of the office, but I just do not have the structure chart with me to say what the title of the head of that unit is at the moment.

Senator RONALDSON: Is the answer that the taxpayers have been asked to stump up a new position in the Prime Minister's office to address her clear deficiencies? Is that what this is actually all about? If you do not know that there is someone there, I am assuming this is a new position. Why should the taxpayers stump up the cost for that?

Senator Chris Evans: Senator, you know these questions are best directed in the MOPS section. I do not believe it is a new position, but we will get that information for you.

Senator RONALDSON: Minister, with the greatest respect, I do not think it is a MOPS question. You are the Prime Minister's representative. The department cannot even tell me if there is someone called the director of communications existing at the moment. I am assuming there is not and I am assuming that this man has been put on to try and bolster the Prime Minister's faltering image. Why should the taxpayers stump up the cash for that? Why was it good enough for McTiernan to be paid by the Labor Party but not this apparent ex-thinker in residence from South Australia?

Senator Chris Evans: You ask whether or not there is someone currently in that role. I have offered to take that on notice for you. I do not know the answer to that. I do not think your assumption that it is an additional position is right but I actually do not know, so I will take that on notice and get the answer for you.

Senator RONALDSON: Senator Abetz has just said do the officials know. The answer to that is that the officials apparently do not know whether there is someone called the director of communications in the Prime Minister's office. I assume from that, Senator Abetz, that there is not and therefore it is a new position paid for by the taxpayer.

CHAIR: Senator Ronaldson, have you got a question? We are going very shortly to the agreed position.

Senator RONALDSON: No, that will do me, thank you.

Ms Leon : Chair, can I just correct the record on something I said just before the break. In response to questions about whether the Ombudsman's office had discussed budgetary issues with the department, I indicated that there was specific discussion during the 2010-11 budget process but I had actually meant to refer to the 2011-12 budget process.

CHAIR: Thank you. I remind the committee that we will be coming back to outcome 1 dealing with general issues after we hear from the National Security Adviser.

[16:15]

CHAIR: We will now move to outcome 1.2, National security and international policy. Thank you for appearing before us, Dr McCarthy.

Senator RYAN: Can I ask how many meetings of the National Security Committee of cabinet have taken place in the last six months?

Dr McCarthy : I do not have that detail in front of me, Senator. In any case we do not comment on meetings of cabinet.

Senator RYAN: No, but are you saying you cannot take on notice how many meetings have occurred?

Ms Leon : We do not comment on the timing of cabinet committee meetings.

Senator RYAN: In the past there has been a matter of public concern that the Prime Minister sent a staff member to meetings of the National Security Committee. Are you now saying you will not answer questions about this? This has been discussed in estimates before, who attended meetings of the National Security Committee.

Senator Chris Evans: And I handled those, Senator, and I made it clear to you then that we do not provide advice as to the attendance or the time scheduling of cabinet or cabinet subcommittee meetings.

Senator RYAN: I am not asking for scheduling or time, I am asking how many happened. I am not asking how many you plan to happen.

Ms Leon : We do not usually disclose when or how many meetings of cabinet or cabinet committees are held.

Senator RYAN: Will you tell us what the Prime Minister's attendance record was?

Senator Chris Evans: No, Senator.

Senator RYAN: Will you tell us whether or not she sent along junior staff, as has happened previously?

Senator Chris Evans: This is a longstanding practice under both the previous government and this government about not providing information about the details of cabinet or cabinet committee meetings and attendance. You refer to publicity around someone being sent representing the then Deputy Prime Minister, but there has been longstanding practice not to provide details of cabinet meetings or cabinet committee meetings under successive governments.

Senator RYAN: So you will not let us know whether or not the Prime Minister has done what was alleged previously and sent along a junior staffer in the place to the National Security Committee. You will not even deny that?

Senator Chris Evans: I am not going to play a game of what I will not deny. I have told you that we do not provide the information regarding the timing and occurrences of cabinet and cabinet committee meetings nor the attendance at them.

Senator RYAN: Can you detail the consultation with other departments that took place before the Prime Minister announced the white paper on Australia's engagement with Asia on 28 September?

Dr de Brouwer : Consultation took place with Treasury and the Department of Foreign Affairs before the announcement.

Senator RYAN: What was the nature of that consultation and what were the dates of that consultation?

Dr de Brouwer : I do not have the dates in front of me. The nature of the consultation was to talk about what would be in the Australia in the Asian Century white paper and to seek those departments' views on that material.

Senator RYAN: Can you take on notice when the Department of Foreign Affairs and Trade and who at the Department of Foreign Affairs and Trade—whether or not that happened to be the minister and/or the secretary of the department—was consulted prior to this announcement? Obviously it makes a big difference if they were consulted in August versus being consulted in late September.

Dr de Brouwer : I will take that on notice. The consultation did occur with the Secretary to the Department of Foreign Affairs and Trade. This is from the Department of the Prime Minister and Cabinet.

Senator RYAN: Was that consultation specifically about the proposal for a white paper on Australia's future engagement with Asia or was it more general in nature?

Dr de Brouwer : It was specifically to the white paper.

Senator RYAN: Did it include discussion of the terms of reference?

Dr de Brouwer : I believe so—in broad terms. I will come back with firm detail about that.

Senator RYAN: I would also appreciate as well as the nature of the consultation and the dates of the consultation whether that was simply discussions between officers over the phone, whether it constituted meetings of officials from both departments and the degree of involvement of people from the Office of the Prime Minister and the office of the foreign minister.

Dr de Brouwer : I will take on notice consultations from the department with other departments.

Senator RYAN: Sorry; could you restate that?

Dr de Brouwer : Departments talk among departments. Departments do not necessarily or would not ordinarily go to other ministerial officers. So the nature of our discussion would be with other departments.

Senator RYAN: The nature of your discussion, presumably, was with the Department of Foreign Affairs and Trade.

Dr de Brouwer : That is right.

Senator RYAN: I would appreciate some clarity around dates. Consultation could be you picking up the phone to your counterpart in DFAT the day before the announcement was made or consultation could be a series of weekly meetings between officials with expertise in this area between the two departments in the month leading up to it. I think you would appreciate that both would constitute consultation. It is a magic word.

Dr de Brouwer : I do not have the details of the times, so we will come back through questions on notice.

Senator RYAN: Was the Department of the Prime Minister and Cabinet at any point given an instruction to include or not the office of the foreign minister?

Dr de Brouwer : As I said, PM&C consults with other departments. It does not generally consult with ministerial offices.

Senator RYAN: You are a central agency; you consult with more departments than most, particularly in an area like this which presumably would involve the Department of Foreign Affairs and Trade and potentially also others given the scope of the project. Are you saying that your only consultations were with the Department of Foreign Affairs and Trade and the Office of the Prime Minister—you spoke to no-one else?

Dr de Brouwer : As departments of state, our consultations are with other departments of state.

Senator RYAN: Can you tell me which other departments of state you consulted with?

Dr de Brouwer : Yes. I mentioned the Department of the Treasury. So the Department of the Prime Minister and Cabinet consulted with the Department of the Treasury and with the Department of Foreign Affairs and Trade.

Senator RYAN: Did that consultation involve any discussion or the seeking of advice about the appointment of Dr Henry and the potential conflict given the wide scope of this project with his role now as a board member of the National Australia Bank?

Dr de Brouwer : My understanding is that the discussions included reference to Dr Henry leading the task force. I am not aware of any discussion around a conflict of interest as you suggest. I will take that question on notice.

Senator RYAN: Senator Evans, these are questions regarding the Prime Minister's office. Can you take on notice—given that I assume you will not be able to answer—whether the Prime Minister and what form the Office of the Prime Minister or the Prime Minister herself consulted with the office of the foreign minister?

Senator Chris Evans: I am happy to take it on notice. I am not sure that I would be answering questions regarding discussions between ministers or their officers, but I am happy to take the question on notice. Senator Ronaldson has just ducked out but he asked a question earlier and made the suggestion that perhaps there had been a new position created that Mr McTernan was taking up as Director of Communications. I just want to put on the record that there is an existing job of Director of Communications which he has been appointed. At this time there is an acting director—so he will take up an established position.

Senator ABETZ: So what is the acting director going to do?

Senator Chris Evans: I do not have that level of detail. As I understand it, there was someone from inside the office who was acting in the role and will revert, no doubt, to their other role.

Senator ABETZ: Could you take on notice when the role became vacant?

Senator Chris Evans: Yes. The key point is that the suggestion was made that there was a new job being created—and that is not right. Mr McTernan is being appointed to an existing office.

Senator ABETZ: Or clearly somebody has left and a replacement appointed.

Senator RYAN: Senator Evans, you say that you do not want to or are somehow reticent to look into discussions between ministers. I put to you that the consultation of a Prime Minister with the Minister for Foreign Affairs about the establishment of a white paper process outside of the department of foreign affairs that deals with foreign affairs is a matter of some public import. Will you commit to taking on notice and providing to the committee the detail of the consultation between the Prime Minister and the foreign minister not at a departmental level, given the department does not do that, regarding the establishment of this white paper process?

Senator Chris Evans: No.

Senator RYAN: Why not?

Senator Chris Evans: Because I do not and we traditionally do not, Senator, provide evidence to Senate committees of conversations or detailed discussions between—

Senator RYAN: I said consultation.

Senator Chris Evans: You are asking for information regarding a conversation or interaction between ministers about a policy decision of government. The answer is: we do not provide that.

Senator RYAN: If you do not want to ask that question because I appreciate it is probably a difficult one to ask, you could just say so. But, surely, the relationship—

Senator Chris Evans: I have made it clear to you what the policy is.

Senator RYAN: There is not a policy to say that you refuse to ask the question whether or not the Prime Minister consulted with the foreign minister about the establishment of a white paper into foreign policy.

Senator Chris Evans: You are asking me to provide the detail. I took on notice before the question, if you check the Hansard

Senator RYAN: And I have restated the—

Senator Chris Evans: but I also made it clear to you that discussions between ministers—

Senator RYAN: I used the term 'consultation'.

Senator Chris Evans: And you used the word 'detail'. I am making it very clear to you so you are under no misapprehension: I will not be providing you with details of interactions between ministers in the lead-up to policy decisions by government. But I said I would take the question on notice. To the extent that I can be helpful, I will be, but in terms of describing who said what to whom and whether or not there were discussions—

Senator RYAN: I do not want a transcript; I want to know when—

CHAIR: Senator Ryan, you have asked your question. Will you allow the minister to complete his answer. It would help me and it would also help Hansard to record these proceedings. Minister, you have the call.

Senator Chris Evans: As I indicated to Senator Ryan at the start, I was happy to take the question on notice but I make the point: we will not be providing information regarding discussions, interactions, between ministers about policy decisions that are taken by the cabinet.

Senator RYAN: To clarify, Minister, I am not asking about a transcript of the conversation; I am asking if they took place and, if so, when the foreign minister was notified of the commencement of this process, neither of which I think is outside the ambit of this estimates committee.

Senator Chris Evans: I disagree, Senator.

Senator RYAN: You are saying you disagree that a question as to when the Prime Minister spoke to the foreign minister or consulted in another mechanism about the establishment of this white paper process is outside the scope of this estimates hearing?

Senator Chris Evans: You are asking me about a conversation between ministers—

Senator RYAN: I am not asking for the details of the conversation; I am asking when the conversation took place.

Senator Chris Evans: If you asked me whether there was a conversation with the Prime Minister in preparation for these estimates, I will tell you it is not your business. It has never been traditionally given to committees, and I will not be giving it to you.

Senator RYAN: So how are we allowed to know what consultation was undertaken between the Prime Minister and the foreign minister about the Prime Minister establishing a white paper process in his portfolio area?

Senator Chris Evans: The officer just took on notice the operation of the public service and the public policy matters in terms of the relationship between PM&C and Foreign Affairs. He took on notice those questions. You will get answers to those questions in accordance with normal practice. You do not get answers to questions about interactions between ministers.

Senator RYAN: This is about budget estimates and that has traditionally included not cabinet proceedings but what has been going on in the Prime Minister's office. You are here as her representative and you cannot simply say, 'I exclude everything that happens between two ministers. You can only find out about departments.' I can only imagine your outrage, being on this side of the table, if a similar statement had been made.

Senator Chris Evans: Senator, you asked me about discussions between ministers.

Senator RYAN: I am asking for consultation. When did Kevin Rudd find out—

Senator Chris Evans: I am not going to tell you about conversations between ministers.

Senator RYAN: When did Kevin Rudd find out this was going to be announced? You seem keen not to ask the question.

Senator Chris Evans: I have got no idea, Senator, but I took the question on notice. You can have it either way. I will take it on notice, but you will not be getting advice about discussions between ministers; never have, never will. The same policies applied under the previous government.

Senator FIFIELD: It has always been the practice that committee members ask for a sequence of events, ask which date particular meetings took place, ask which date some conversations took place without actually going necessarily to—I am not saying that you should not—the subject matter or the substance of those discussions. So the sequencing of events is something which is very commonplace and appropriate for committee members to ask, and I think that is all that Senator Ryan is asking at this point.

Senator RYAN: You expressed it better than I did!

Senator Chris Evans: I have made my position clear. I have taken the question on notice.

Senator RYAN: I note that if the minister does not provide the sequence of events as described quite effectively by Senator Fifield—

CHAIR: Senator Ryan, you know—

Senator RYAN: There is a point of order here, Chair.

CHAIR: You did not say you were raising a point of order.

Senator RYAN: My apologies. I am raising a point of order. The minster will not answer now and he refuses to commit to answer the question about the sequence of events. If in his answer to the question he does not outline that then this will be a matter that is pursued further. We are not asking for the detail of conversation between ministers. We are simply asking for the formalities of consultation about a significant announcement that the government has been trumpeting for the last few weeks.

CHAIR: There is no point of order. The minister has taken it on notice to respond to your questioning. I cannot direct the minister on how to respond. You are at liberty to take up that issue when you receive the answer back. Have you any further questions?

Senator RYAN: Yes.

Ms Leon : Before we start another line of questioning I thought I might just provide some further information to Senator Ryan about a matter he asked about a little earlier. While I cannot provide information about when National Security Committee meetings occurred or who attended them I can draw your attention to—

Senator FIFIELD: You said you cannot provide information as to when national security meetings occurred. Is that because you do not know or is it because you will not provide it?

Ms Leon : It is because the timing of National Security Committee meetings is not ordinarily disclosed. I can, however, draw your attention to page 83 of the department's annual report, which provides details of the number of meetings held in the past financial year.

Senator RYAN: Thank you, Ms Leon, you have predictive abilities. I was going to address the point made by Senator Evans that these details are not provided and refer to questions that have been tabled recently by Senator Trood and Senator Abetz about the number of times the National Security Committee of Cabinet has met.

Ms Leon : I am happy to be able to provide that to you. I can read it into the record if you would like.

Senator RYAN: Okay.

Ms Leon : Is it the details for the last financial year that you would like?

Senator RYAN: As a start, yes please.

Ms Leon : There were 20 meetings of the National Security Committee in the 2010-11 financial year.

Senator RYAN: Only 20? How many have there been since then?

Ms Leon : I do not have that with me. We compile this and publish it on an annual basis. This report has just been tabled. I would have to take it on notice how many meetings there have been since then. But that was 20 meetings up until the end of June 2011.

Senator RYAN: So you can take on notice how many meetings have occurred?

Ms Leon : I will take it on notice.

Senator RYAN: Thank you. I just wanted to clarify the issue raised earlier. In December 2008 the then Prime Minister Rudd delivered the inaugural national security statement to parliament. He promised it would be the first of regular statements and I believe he also said it would become just as important as the annual budget statement. Am I correct in saying there has been no subsequent statement since December 2008?

Dr McCarthy : I think there has not been a statement since the inaugural statement.

Senator RYAN: Has that been due to the lack of a direction from the Prime Minister to the department to prepare a statement? That would be the normal course of events, wouldn't it—that the Prime Minister would direct the department to prepare a statement of that order?

Dr McCarthy : The timing of such statements is a matter for the Prime Minister.

Senator RYAN: So you have received no direction from the Prime Minister—from his or her office—since 4 December 2008 to prepare a subsequent national security statement to parliament?

Dr McCarthy : As you would appreciate, we would not normally go to the issues of either what advice the Prime Minister seeks or the advice that the department provides.

Senator RYAN: You might not wish to go there, Dr McCarthy, but the rules of Senate estimates do not preclude it unless someone is asserting it went to cabinet or has some other degree of public interest immunity. 'Advice to ministers' is not a catch-all phrase to protect or prevent the release of information.

Dr McCarthy : I have nothing further to add.

Senator RYAN: You have the choice to answer the question or to refer it to the minister, Dr McCarthy.

Senator Chris Evans: Perhaps to help you out: as I understand it, it is a matter of fact there has only been one national security statement, which was in December 2008, as you said—I think that is right. As to the questions about any advice between the Prime Minister and PM&C, we will take that on notice.

Senator RYAN: Do you have an answer as to why there has been no subsequent statement representing the Prime Minister here?

Senator Chris Evans: No. As you know, the former Prime Minister made a statement. I am not aware as to why his intention to continue that has not been pursued, but I point out that the Prime Minister has made a number of statements to parliament about our engagement in Afghanistan as a way of trying to share information about the progress of our engagement there with the parliament and the Australian people. But, as to the intentions regarding our national security statement more broadly, I will have to take that on notice.

Senator RYAN: The incoming government brief from the Department of Foreign Affairs and Trade of September last year which was released under FOI referred on page 90 to the fact that 'some elements of the government's national security framework have not worked very well.' It also refers to the 'need to revisit fundamentals, including the broad definition of national security, which has been adopted.' I would assume the Department of Prime Minister and Cabinet would have a view on such matters. What are the national security framework elements that have not worked well? Or do you contest the advice of the Department of Foreign Affairs and Trade in that regard?

Dr McCarthy : I think any questions on elements of the Department of Foreign Affairs and Trade's incoming government brief that have been released under FOI are best directed to the Department of Foreign Affairs and Trade.

Senator RYAN: The Department of Foreign Affairs and Trade cannot answer the question though, Dr McCarthy. What is your view of the comments by the Department of Foreign Affairs and Trade in this regard?

Dr McCarthy : The national security strategic policy framework, which goes to issues of prioritisation, a coordinated national security budget and performance evaluation, continues to develop. As I said, the views of the Department of Foreign Affairs and Trade are for the Department of Foreign Affairs and Trade. We are pleased with the way in which it is developing.

Senator RYAN: So you have not contested that view?

Dr McCarthy : I would probably categorise such a view as part of the ongoing healthy and creative tension between central agencies and line agencies. Line agencies are always free to have their own views on processes.

Senator RYAN: Sorry, can you restate that? I am losing my way here between certain phrases.

Dr McCarthy : The Department of Foreign Affairs and Trade is free to express its views about the processes that central agencies run.

Senator RYAN: It is all about freedom.

Senator Chris Evans: It is a healthy and constructive tension.

Senator RYAN: So healthy and constructive tension is an important thing?

Dr McCarthy : Creative tension.

Senator Chris Evans: Creative tension.

Senator RYAN: Sorry—creative tension, Dr McCarthy. Creative tension is an important thing, and I appreciate the need for that. My concern here is that we have one department fairly intimately involved and making some fairly damning comments about a basic role of government—the national security framework. My apologies if I have got this wrong, Dr McCarthy—are you acting or are you the permanent National Security Adviser?

Dr McCarthy : I am the Acting National Security Adviser.

Senator RYAN: You are the National Security Adviser, and you are here just telling me about a process and telling the Australian people about the importance of creative tension. I am asking you for a pretty simple view: do you agree with the statement there of the Department of Foreign Affairs and Trade in its brief to the incoming government, or would you contest it?

Dr McCarthy : I do not know that I would agree with your characterisation of the Department of Foreign Affairs and Trade's statement as damning. It seems to me that their statement goes more to some improvements that they perhaps believe could be made. I do not know the exact nature of the improvements they are referring to, but part of the national security strategic policy framework is annual performance evaluation. That suggests that the framework itself is open to suggestions of where it can be improved.

Senator RYAN: Given the time, I am going to move on. Why has the post of National Security Adviser been left vacant for nearly two months? Do we have a timeline for a permanent replacement?

Ms Leon : The position is one that is subject to a merit recruitment process and so the position has been advertised. Applications closed on 17 September, I think—I will just get that date for you—and the recruitment process is on foot to fill it.

Senator RYAN: Do we have a timeline?

Ms Leon : That would depend on how many applicants there were and when they were available for interview. Ordinarily, senior positions take in the vicinity of three months to fill.

Senator RYAN: When was this process commenced?

Ms Leon : It was advertised on 1 September in the Gazette, on 2 September in the Australian Financial Review, and in the Australian on 3 September. Applications closed on 18 September. There is an executive search company that is managing the recruitment process and so I imagine they will be at this stage conducting screening processes for those who have applied, prior to formal interviews occurring.

Senator RYAN: I appreciate that. So there is no set date by which this will be announced, because you are waiting on the recruitment company to complete this process. The applications closed a month ago.

Ms Leon : That is right.

Senator RYAN: Dr McCarthy, I quickly have another question about my previous issue. Did the Department of Foreign Affairs and Trade write that advice to the incoming government without consulting the Department of Prime Minister and Cabinet, or was the Department of Prime Minister and Cabinet consulted about that advice?

Dr McCarthy : Not to my knowledge.

Senator RYAN: I would appreciate if someone could take on notice if you might not have been in the capacity—

Senator Chris Evans: Are you are really asking whether there is coordination across departments for incoming government briefs?

Senator RYAN: My understanding is that central agencies do have some influence over incoming government briefs from line agencies.

Senator Chris Evans: No, that is what you are after—the question is whether they were consulted about the brief.

Senator RYAN: Yes.

Dr McCarthy : I can take that on notice.

Senator RYAN: Sure. In the Prime Minister's address to C ongress, there was a rather embarrassing mispronunciation of a n important battle , particularly to Americans. I will do my best to pronounce it, noting that I a m not addressing a joint sitting of C ongress, when I refer to the battle of Pont Duoc. The Prime Minister pronounced it profoundly differently. Has the department undertaken some steps to make sure that does not happen again? If Barack Obama next week mispronounce s Gallipoli then, quite frankly, this is the way many Americans would feel about what the Prime Minister said.

Senator Chris Evans: I know I always cringe when people like you come to Western Australia and refer to Albany and Derby, so there are often pronunciations. But I have to get information.

Senator RYAN: I am happy to be sled ged by you but at least sledge me with some basis in reality, because I have never done that.

Senator Chris Evans: Maybe Dr McCarthy can advise whether there has been any follow-up?

Dr McCarthy : I can take on notice the question of whether there was any follow-up on that matter.

Senator RYAN: So you can take on notice whether or not you have put in place any steps to make sure that our Prime Minister does not profoundly mispronounce a key phrase in a major speech in the future?

Dr McCarthy : As I said, I can take on notice whether there was any follow-up on the matter.

Senator RYAN: Good luck.

Senator RHIANNON: Dr McCarthy, was the Australian government involved in giving advice to the Sri Lankan government or in any other way when the Sri Lankan security forces stopped a boat carrying 4 4 asylum seekers trying to leave Sri Lanka?

Dr McCarthy : I think that goes to a matter that might best be referred to Customs and B order P rotection.

Senator RHIANNON: I asked the question because there are reports that the Australian high commissioner, K athy Klug man, praised the Sri Lankan security forces for their work in stopping this boat. It has been linked with Australia's attempt to manage boat s coming to Australia and its interest in Sri Lankan domestic politics. As the Australian Prime Minister has given a great deal of attention to this matter lately, that is the context in which I asked the question. It is hard to believe that Department of the Prime Minister and Cabinet do es not have some awareness of this issue.

Dr McCarthy : On the issue of engagement with other regional countries in deterrence of the people-smuggling trade, it is well known that we engage with regional partners, but we tend not to go into specific operational details.

Senator RHIANNON: Do you mean that you have the details but you are saying that you do not want to bring those details to this forum?

Dr McCarthy : I do not have to hand any details on the issue that you have referred to. There would be sensitivities around operational details, if that is the sort of information that you are seeking.

Senator RHIANNON: Could you inform the committee if the Australian Federal Police assisted Sri Lankan security forces in any of their operations in stopping the boats leaving Sri Lanka to come to Australia?

Dr McCarthy : I think questions about the Australian Federal Please activities are best directed to the Attorney-General portfolio.

Senator RHIANNON: What role does the Department of the Prime Minister and Cabinet play in the appointment of high commissioners?

Dr McCarthy : Are you referring to the appointment of Australian high commissioners to overseas posts?

Senator RHIANNON: No, sorry, the appointment of high commissioners to Australia. We have them from various countries. High commissioners—or ambassadors, for that matter?

Dr McCarthy : My understanding is that in relation to incoming high commissioners and ambassadors what is known as agrément is provided on the advice of the foreign minister.

Senator RHIANNON: What if the person to be appointed has been accused of serious war crimes? Do you undertake any special measures? How is this managed?

Dr McCarthy : As I said, these issues are managed on the basis of advice from the foreign minister to the Governor-General on the question of agrément.

Senator RHIANNON: That is advice to the department?

Dr McCarthy : No, on the advice of the foreign minister the Governor-General provides what is known is agrément to countries seeking to appoint high commissioners and ambassadors.

Senator RHIANNON: So you are saying that there is no actual involvement by the department?

Dr McCarthy : It would depend on the issue and on whether the department was required to provide advice.

Senator RHIANNON: I will ask the question again, because it seems as though from your last response that there can be occasions when the department is involved. If a person to be appointed as a high commissioner has been accused of being involved in war crimes would the department then become involved or at least seek some sort of advice?

Dr McCarthy : The issue would be coordinated and managed by the foreign minister.

Senator RHIANNON: With advice coming to the department?

Dr McCarthy : The foreign minister would provide that advice primarily on the basis of advice coming from his own department. We only advise the Prime Minister; we do not advise the foreign minister.

Senator RHIANNON: No, I obviously appreciate that. I am just trying to understand how the process works.

Senator Chris Evans: I think the answer is that primarily the responsibility is with the foreign minister and the Department of Foreign Affairs and Trade but that PM&C might provide advice to the PM if there was reason to them to get involved or matters were referred to them. But as a matter of normal procedure, carriage lies with the Department of Foreign Affairs and Trade. If you want to pursue specific appointments then officers could advise if they have been engaged in that. But if you keep with generalities we are not going to make any progress. So if you want to get to—

Senator RHIANNON: I appreciate that, but I guess I do want to understand the generalities to understand how the current situation may have unfolded.

I would like to now move to the current situation. There was a report on the front page of the Sydney Morning Herald today with regard to the current Sri Lankan High Commissioner to Australia. These allegations are now the subject of a submission from the International Commission of Jurists—Australian Section, and of the Federal Police. Those allegations had been made prior to the appointment. So I wish to understand what attention the department gave to this matter, considering it has been in the public domain for a long period, and what advice was provided to the Prime Minister.

Dr McCarthy : I can say that advice on that matter was provided, but we obviously do not go into the question of the advice that was provided.

Senator RHIANNON: So the advice was provided prior to the current Sri Lankan High Commissioner taking up the post?

Dr McCarthy : I do not have the detail with me.

Senator RHIANNON: That is what I understood your response indicated, but I just want to confirm that my understanding was correct.

Dr McCarthy : Advice has been provided on that matter.

Senator RHIANNON: I just want to get the time right. That was prior to the acceptance of the current Sri Lankan high commissioner in that role?

Dr McCarthy : I will take on notice questions about timing.

Senator RHIANNON: On what grounds could the Australian government withdraw the accreditation of an ambassador or high commissioner?

Dr McCarthy : That matter I think falls within the foreign minister's portfolio and is best put to the Department of Foreign Affairs and Trade.

Senator RHIANNON: Thank you, Dr McCarthy.

Senator ABETZ: I have a question in relation to Dr Henry's white paper, but I daresay other officials could deal with that.

CHAIR: Thank you very much for making yourself available, Dr McCarthy.

Senator Chris Evans: I thank the committee for their cooperation.

Senator ABETZ: As I understand it, a white paper in Australia is an official statement of policy by the national government. Is it the understanding of the Department of the Prime Minister and Cabinet that that has been the tradition?

Dr de Brouwer : Yes.

Senator ABETZ: Am I to understand that Dr Henry's paper Australia in the Asian centurywill in fact be a discussion document?

Dr de Brouwer : No, it is a white paper. It will go through normal cabinet processes, so it will be a government statement, but Dr Henry will consult widely in terms of getting the material provided to the government on that matter.

Senator ABETZ: In his wide consultations, will he perchance trip to the department of foreign affairs?

Dr de Brouwer : The department of foreign affairs is engaged as a member of the task force, so we will be a member of the task force supporting Dr Henry and—

Senator ABETZ: Have they been advised of that?

Dr de Brouwer : Yes.

Senator ABETZ: Do you know when?

Dr de Brouwer : No.

Senator ABETZ: If you could take that on notice for me, because it is of interest that as of—and I forget exactly which date—Mr Rudd and the department did not have this matter up on their website. So I might ask foreign affairs about it: if they have put it up on their website and, if so, when.

Dr de Brouwer : I add that the Department of Foreign Affairs and Trade is also represented on the advisory board supporting Dr Henry.

Senator ABETZ: Were they advised prior to the announcement by the Prime Minister?

Dr de Brouwer : As I answered earlier on—yes, the matter was discussed with both the Department of the Treasury and the Department of Foreign Affairs and Trade.

Senator ABETZ: Yes, but how many days before the announcement?

Dr de Brouwer : This question has been taken on notice.

Senator ABETZ: All right; thank you.

CHAIR: If that is all, we will now go back to general questions.

Senator RYAN: Is this the place where I should ask about that Prime Minister's travel expenses overseas, or would that be better in 1.1.4, official visits?

Senator Chris Evans: If it is under 1.1.4, then we will do it under 1.1.4.

Senator RYAN: I am just not sure where it would fit, that is all. I am asking—

Senator Chris Evans: Is that the correct—

Senator RYAN: Yes, it is.

Senator Chris Evans: We will work on that. If that is not right, we will come back to you.

CHAIR: We will turn to general questions.

Senator RYAN: Going back to general questions, how much does the department spend on behalf of the Prime Minister's office for each of the following: subscriptions to magazines and periodicals; media monitoring, including the provision of news clippings and transcripts; and other publications—that might be things that do not count as periodicals but are books or legislation or the like—on a monthly and an annual basis? Do you have those figures?

Ms Leon : I can tell you that for 2010-11 the cost for the whole communications spend, which included newspaper and media monitoring subscriptions but also the costs of telephones and postage—so it is a little bit broader than your question—was $456,849.

Senator RYAN: Just go through what that includes—media monitoring, which includes news clips and transcripts?

Ms Leon : The material I have is that it includes telephones, postage and freight, newspapers and clippings—that is, media monitoring—and subscriptions. So it is all communications.

Senator RYAN: Could you break that down so that I have a cost for each of those?

Ms Leon : I will take that on notice and provide you with the information I can.

Senator RYAN: I would also be interested, as you said media monitoring clippings, in whether or not that includes the provision of transcripts or just clippings.

Ms Leon : I will take that on notice.

Senator RYAN: Could I also have as broad a definition as you have of communications and what else falls in there, unless you have a larger one at hand?

Ms Leon : I do not have a longer definition here.

Senator RYAN: How much is budgeted for this year, 2011-12?

Ms Leon : I can tell you the amount that has been spent this year so far, which is $34,523. I would have to take on notice how much it has budgeted for this year.

Senator RYAN: To the end of what month would that represent?

Ms Leon : That is to the end of August.

Senator RYAN: So, roughly, one-sixth?

Ms Leon : That is right.

Senator RYAN: Do you have any information on, over the course of 2010-11, a monthly budgeted cost for that?

Ms Leon : I do not have it with me, but I can take that on notice.

Senator RYAN: I particularly ask for that breakdown along the lines of subscriptions, media monitoring and publications. Could I ask that for 2010-11 there be a monthly breakdown of those?

Ms Leon : To the extent that it is broken down by reference to the categories you refer to, I will—

Senator RYAN: Or by whatever your billing cycle might be. I will presume that you guys do not just pay a bill at the end of the financial year. These guys like to be paid—

Ms Leon : There will be a monthly breakdown, but I do not know whether it will be broken down in the level of detail that you have asked for, as to how much on subscriptions and how much on transcripts, but I will provide it at the level of breakdown that is available.

Senator RYAN: By phones, you basically mean mobile phones and things?

Ms Leon : That is correct.

Senator RYAN: I am not particularly interested in those, but I am interested in effectively every bill you paid, if that is the most you can break it down to: the media monitoring bills that were paid, the subscription bills you paid. If you cannot break it down yourself, that would be the format in which I could understand it.

Ms Leon : I will see what we can do for you. It may not be possible to break it down into categories, but I will see what is possible.

Senator RYAN: I just want to emphasise this point. I made the point about saying I would like to see what the department paid, because I presume that if you cannot break it down then at least I can see the bill for Media Monitors. You might not be able to break it down between news clippings and transcripts, but, presumably, you will have an invoice and a cheque that was written out for them, or whatever the electronic equivalent is.

Senator Chris Evans: Senator, I do not think you are cross purposes. I think you will get the material you want.

Ms Leon : I have taken it on notice.

Senator RYAN: That is all I have for general questions.

Senator FIFIELD: Back onto the issue that Senator Ryan raised before about people who are engaged by the department to write speeches and prepare that sort of material for the Prime Minister, I did see in the paper a few weeks back that a Ms Corinne Grant was presenting herself as a writer of lines for the Prime Minister. I think she is by profession a comedian. Is Ms Grant engaged by PM&C?

Ms Leon : She is not on our staff. I think I have taken on notice the question of whether we have engaged any other casual contractors for the purposes of input to speeches.

Senator RYAN: She is not on staff. You are not aware as to whether she has been contracted?

Ms Leon : I do not have any of the details of the casual contracts available.

Senator RYAN: Okay. Surely one of your officers here today would have that detail and will be able to confirm that Ms Grant is or is not contracted.

Ms Leon : We can see what we can get before the end of the hearing.

Senator RYAN: I just would be interested, particularly because it has been in the public domain and I know the department does monitor these sorts of clippings. I would appreciate it if you could check with officers.

CHAIR: Senator Ryan, do you have any further questions?

Senator RYAN: Again I am seeking guidance of the minister. I am happy to ask here if necessary the cost of the Prime Minister's domestic travel.

Senator Chris Evans: I think you ought to seek the guidance of the chair, Senator. We are happy to deal with things under items that they normally appear under. If you want to change that, that is between you and the chair. I can check which item that is supposed to be under. I am advised that domestic travel is actually paid for by Finance.

Senator RYAN: So the cost of charters of the VIP fleet and cars are paid for by the Department of Finance rather than the Department of Prime Minister.

Ms Leon : Comcar in the Department of Finance.

Senator RYAN: I am talking about plane charters, which will probably be a larger amount.

Ms Leon : We do not do planes. That comes out of MAPS, the Department of Finance.

Senator RYAN: So the charters for the VIP fleet come out of MAPS. I am happy to ask them.

Senator FAULKNER: I raised an issue I have raised with the Department of Prime Minister and Cabinet and the Department of Defence on the issue of recognition of the Australian Women's Land Army. I did flag with senior officials of the department that I would ask and check. If you want to suggest that I ask this in another part, it will not take a moment but if you prefer me to ask at a later stage that is fine. I could not work out which program to ask it in; it seemed more like a general question, have there been any discussions with the Department of Defence. But if you would care to direct me to a later stage in the proceedings, I would be happy with that too.

Senator Chris Evans: I think we have got an official here who can help. We were aware that you would return to this issue.

Ms Noble : You asked have we discussed with the Department of Defence the issue of Australian Women's Land Army recognition.

Senator FAULKNER: That is right.

Ms Noble : Yes, we have.

Senator FAULKNER: What was the outcome of those discussions?

Ms Noble : I understand that it is PM&C's view that there may be an alternative non-medal avenues through which to enhance the Australian community's awareness and appreciation of the Australian Women's Land Army's contribution to the war effort.

Senator FAULKNER: You are aware of the question on notice that I asked in this portfolio, No 56 of 23 May?

Ms Noble : Yes, and I understand that, given the Australian Women's Land Army was never legally part of the defence forces, the Department of Prime Minister and Cabinet's view in response to that question on notice noted that former members of the Australian Women's Land Army are eligible for the Civilian Service Medal 1939-45 which recognises Australian civilians who served in arduous circumstances in support of the war effort as part of organisations with military-like arrangements and conditions of service. But it is the Department of Prime Minister and Cabinet's view that the Civilian Service Medal 1939-45 is appropriate recognition of the services rendered by the Australian Women's Land Army during World War II.

Senator FAULKNER: The suggestions that I have made, including in a recent speech in the Senate chamber, have fallen on deaf ears, have they, in the Department of the Prime Minister and Cabinet?

Ms Noble : As I said earlier, that is our position. We do believe that there may be alternative ways, non-medallic avenues, through which to enhance—

Senator FAULKNER: What would those alternative ways be?

Ms Noble : Two suggestions might be public awareness campaigns, similar to that delivered by the National Archives of Australia on the historic role the Australian patrol officers played in preparing Papua New Guinea for independence. That is one such option. A second may be that any other alternative methods might be organised and funded by the defence portfolio—and I guess that is the second part of our suggestion.

Senator FAULKNER: What I am trying to do is to stop the duck-shoving between departments. I am just trying to find a department that might take responsibility for this before all these ladies have passed away. There are not many of them left.

Ms Noble : I guess our suggestion is that that department is more appropriately the Department of Defence.

Senator FAULKNER: What I would like to know from PM&C is: when Defence appear before the Foreign Affairs, Defence and Trade Committee, am I going to be told by them that they think PM&C is the most appropriate department?

Ms Noble : I do not know what the Department of Defence will advise you, Senator.

Senator Chris Evans: Can I try to help you? If Defence are on later in the week, I will undertake to speak to the Minister for Defence and ask that they represent a whole-of-government response to you. It seems to me the point you make is one not uncommon when senators are dealing with these things. I think PM&C's view is that it is primarily a matter for Defence. But I understand the experience you have had and I think it is probably appropriate that at defence estimates this issue is aired. I will ask both PM&C and the Department of Defence to make sure they have a whole-of-government response for you there, and you will either have some joy or not dealing with them rather than arguments about whose responsibility this is.

Senator FAULKNER: The answer to a Prime Minister and Cabinet portfolio question provided to me in the budget estimates round was:

PM&C will engage with the Department of Defence on this issue to identify any further opportunities to recognise the members of the AWLA.

That is why it is not unreasonable—given that I have been told that they are going to engage—to ask whether they have engaged and who is going to step up to the plate and at least be willing to answer some questions.

Senator Chris Evans: I think Ms Noble has made clear what the engagement has been and the advice they have given of their view to Defence. It is not one I suspect you agree with but that is the advice they have prepared.

Senator FAULKNER: That is not the issue at all. What I do not want someone to tell me when I get to Defence is: 'We think it is Prime Minister and Cabinet.'

Senator Chris Evans: That is reasonable.

Senator FAULKNER: It is more than reasonable.

Senator Chris Evans: That is why I offered to contact the Minister for Defence and say that I expected them to have consulted with PM&C prior to that hearing and that they should provide a whole-of-government response. If you want to go argue the toss with them there, that is your prerogative.

Senator FAULKNER: I do not want to argue the toss with anyone; I just want to ask one or two questions. But it is a pretty poor effort when this has been going on for months and months and months. There has been a lot of effort on my part to draw attention to the fact that I was keen to follow it through, because there are very few of these ladies left. It is just a question of appropriate recognition. There is virtually no cost to the Commonwealth involved in this. The duck-shoving between PM&C and Defence is just, in my view, in these sorts of circumstances, not acceptable. It has nothing to do with partisan politics. I would be surprised if every senator did not agree with what I was saying. It is a pretty poor effort that I still have not got an appropriate answer. Anyway, we will try the Department of Defence. I do not think it is worth irritating senators to this degree on these sorts of things. I reckon it is a very poor effort from PM&C, particularly as I flagged it with the secretary of the department, amongst others, that I would be asking these questions.

Senator Chris Evans: All I can say is that that is the advice that I gave to PM&C too—that it was not worth aggravating senators in this regard.

Senator FAULKNER: Then I suggest that you suggest to them that they take a bit of notice of you.

Senator Chris Evans: I have had no luck with PM&C taking notice of me in the past, so I will not make any claims there.

Senator FAULKNER: Well, maybe it is about time it changed.

Senator Chris Evans: You are quite right. I appreciate the senator's frustration. PM&C have outlined to you their policy review today, and it is not one that seems to support the awarding of a medal. They have suggested alternatives. That is advice you do not think is appropriate.

Senator FAULKNER: I have never suggested a medal be awarded to anybody, at any time, and I would not. So it is a nonsensical non-answer to a question I have never asked.

Senator Chris Evans: What do you want from PM&C then, given they have told you the advice they provided to Defence?

Senator FAULKNER: I want them to do what they said they would do in answer to a question on notice: PM&C will engage with the Department of Defence on this issue to identify any further opportunity to recognise the members of the AWLA.

I would have hoped they would have taken account of what I felt was a very good speech I made in parliament on these matters recently, but clearly that is not the case.

Senator Chris Evans: I am not sure that is the evidence. I will let Ms Noble speak. I think what she told you was that they had.

Ms Noble : Yes. My understanding is that we have engaged with the Department of Defence and the advice has been that further formal recognition of the Australian Women's Land Army is not warranted.

Senator RONALDSON: That sounds like a question for Defence—at estimates.

Senator FAULKNER: Ms Noble, is that PM&C's position too?

Ms Noble : Yes, that is our position. But PM&C, as I said before, considers that the Civilian Service Medal, which was one option, is an appropriate recognition of the services rendered by the Australian Women's Land Army during World War II.

Senator FAULKNER: When did these discussions with Defence take place?

Ms Noble : Sorry, I do not have that information.

Senator FAULKNER: Who did they take place with? Can you help me with that?

Ms Noble : We can take those questions on notice.

Senator FAULKNER: I would like to know when they took place and who was involved. I would appreciate a pretty urgent response. Thank you.

Senator RONALDSON: I want to ask some questions of anyone at the table or anyone at the back of the room who may have knowledge of the Prime Minister's discussion with the young man in Bali last week. Is anyone at the table aware of these matters?

Dr de Brouwer : No.

Senator RONALDSON: So no-one is aware of this phone call?

Senator Chris Evans: Sorry, but I do not have any briefing on it.

Senator RONALDSON: There are lots of people leaving the room but not many coming to the front of it.

Dr de Brouwer : Dr McCarthy would have been the person to ask about that, but she had to go to another meeting. I apologise for that. We will see if we can get an answer.

Senator Chris Evans: Can I suggest to the chair that we come back to it after dinner. Dr McCarthy was excused on the basis that she had appointments—

CHAIR: And we had dealt with everything.

Senator Chris Evans: She is the acting national security adviser so I suspect that, in terms of PM&C, she is best placed to provide the answers. So we will find out what we can now but if it requires her attendance we will probably have to do that after dinner.

Senator RONALDSON: I did not ask in that section because I did not know whether it a national security issue. I hope it is not a national security issue.

Ms Leon : The international division is in her group.

Senator RONALDSON: So she will know about it, will she?

Senator Chris Evans: She is the most appropriate person to ask.

Senator RONALDSON: I presume someone knows about it.

Senator Chris Evans: We are happy to be cooperative, but we have excused her. If it is the decision of the committee to come back to it, we will endeavour to get Dr McCarthy back later on.

CHAIR: If she is the most likely person to have the ability to respond then the committee is happy with that.

Senator FIFIELD: I might pursue a medallic theme as well, although it will be more of a civilian nature. The Prime Minister indicated that the Emergency Services Medal would be inaugurated in the aftermath of the Queensland floods and cyclones, when she visited Toowoomba on Australia Day 2011. At the last estimates, in May, representatives of the department indicated that there was no budgetary allocation for these medals, that no award criteria had been developed and no design for the medal had been approved. I understand that this award was to be presented on Australia Day 2012. Given that we are a little more than 100 days away from Australia Day 2012, I was wondering where we are at.

Ms Leon : Her Majesty the Queen has provided in-principle approval for the National Emergency Medal. The department has consulted with all states and territories and relevant stakeholders, including releasing a discussion paper earlier this year to premiers' and chief ministers' departments. Submissions were received from the states and territories, and regulations have been drafted to inform further advice to Government House about the eligibility criteria for the medal and the proposed arrangements for the administration of the medal. We will need the Queen's approval for the design and details of the medal. When we have received the Queen's approval we will work with Government House to arrange for the administration of the awards and the manufacture of the medals as quickly as possible. Having not yet received the final stages of that, I cannot say exactly when that will occur, but we are hopeful it will be soon.

Senator FIFIELD: Will the first of these medals be presented on Australia Day 2012?

Ms Leon : That is still the government's intention. As I said, the timing will depend on when the final design of the medal is approved in order to have it manufactured and have in place a process to select the recipients.

Senator FIFIELD: Okay. The design has not been approved and no medals have been minted to date. The criteria for awarding the medals have not been determined or agreed to?

Ms Leon : The criteria are substantially developed.

Senator FIFIELD: But they have not yet been completely finalised?

Ms Leon : They have not been completely finalised but they are very substantially developed.

Senator FIFIELD: Well, they are either finalised or they are not finalised.

Ms Leon : They are very substantially developed.

Senator FIFIELD: They are close but they are not there yet, they have not been signed off on?

Ms Leon : Quite.

Senator FIFIELD: We do not have a medal, we do not have criteria, and therefore it follows that we do not have anyone to award them to as yet. Australia Day 2012 is very, very close. So it is not going to happen on Australia Day 2012, is it?

Ms Leon : I do not think we have reached the point of decision on that yet.

Senator FIFIELD: As to whether it will happen or not? Okay. The Prime Minister said on 8 February this year:

Next Australia day I am confident we will presenting our first awards to those who have performed heroic and selfless acts and volunteers across Australia.

Ms Leon : I did say it is still the government's intention. When I said I do not think we have reached a decision point yet, I was referring to your suggestion that it would not occur, and I said I do not think any such decision has been reached. It is still the government's intention.

Senator FIFIELD: So you are yet to take the decision that it will not occur?

Ms Leon : That is correct.

Senator FIFIELD: At what point will a decision that it will not occur be taken—one month before Australia Day, two months, three months?

Ms Leon : We will keep that under constant review.

Senator FIFIELD: Minister, this strikes me as looking like another example of where, in what might be seen as one of the more straightforward things for government to do, the government is finding difficulty in giving effect to what it said it would do.

Senator Chris Evans: Senator, I think the officer has taken you through the fact that there are a couple of key things that have to be resolved in order to put this in place, and, importantly, one is the approval of the Queen; until that is received, it cannot progress. But it is still the government's intention to try and have it in place for Australia Day. I do not think we would say anything more than that.

Senator FIFIELD: I will make a prediction that there will be no Emergency Services Medal awarded to anyone on Australia Day 2012.

Senator Chris Evans: If it was not for the fact that I am opposed to gambling, I would have a bet with you, but we will not do that.

Senator RYAN: You do not have to commit; you can just have a bet.

Senator FIFIELD: You can just say, 'I'm sure the Prime Minister's commitment will be honoured.' Okay, we do not have any confidence on that.

[17:20]

CHAIR: We are now dealing with outcome 1.1, Domestic Policy.

Senator PAYNE: I will start with some questions around the last COAG meeting on 19 August. Can you tell me, please, Ms Cross, what the cost of the 19 August COAG meeting was?

Ms Cross : The total cost of the COAG meeting was $24,694.55

Senator PAYNE: On notice, can you provide a breakdown of that sum?

Ms Cross : Yes.

Senator PAYNE: Thank you very much. Can you tell me what the cost of the February COAG meeting was?

Ms Cross : We will have to take that on notice; it is not in the briefing.

Senator PAYNE: Do you know if it was comparable?

Ms Cross : I would imagine so.

Senator PAYNE: Is there another COAG meeting planned for 2011?

Ms Cross : The Prime Minister has indicated that the next COAG meeting is likely to be in early 2012.

Senator PAYNE: Can I ask a question about the workload of COAG. Even the COAG Reform Council Chairman, Paul McClintock, has made quite overt public statements about the progress of COAG reforms and has observed that one of the reasons for that is the previous delay of 10 months in a meeting of COAG. How is the department ensuring that that sort of problem does not occur again and slow down the reform process even further?

Ms Cross : It is normal in between meetings to progress items out of session wherever possible. You do not need to hold off agreement on reforms until a meeting; you can actually get premiers to sign off out of session and progress business that way. There will be a number of matters which we will endeavour to finalise out of session between now and the next COAG meeting.

Senator PAYNE: What impact does the reform of the COAG committees that was announced earlier in the year have on the workload?

Ms Cross : Again, the reform of the COAG councils is progressing well. Twenty of them have been established, and work from any of the councils that are not continuing has been moved to other fora or passed on to new councils, so we are not anticipating that the new council system should cause any delays in any of the major COAG reforms.

Senator PAYNE: What about the statement in the August communique which said:

COAG has agreed to consider before the start of 2012 detailed options for further competition and regulatory reform, following consultation with business and other stakeholders.

Can you advise the committee what the timetable for the consultation of those further options is?

Ms Cross : That work is being taken forward by the Business Regulation and Competition Working Group. My understanding is that consultations are under way. The expectation is that they would report to COAG by the end of this year, and if there is agreement to the proposed new agenda for competition and regulatory reforms that would be a matter that could be progressed out of session.

Senator PAYNE: When you say consultations are under way, do you mean the consultations with business and other stakeholders?

Ms Cross : Yes, as well as with the state and territories obviously in coming up with a reform agenda.

Senator PAYNE: So, if I understood you correctly, Ms Cross, that was an indication that that discussion will take place in the months towards the end of this year with a view to considering at a COAG meeting early next year.

Ms Cross : The consultation process is already under way and it will be finalised over the next few months.

Dr de Brouwer : I might just say there that the BRCWG, that working group, has already issued a working paper for business as part of that consultation process.

Senator PAYNE: Thank you. I have a question to follow up on questions that I asked previously at the budget estimates around Indigenous issues. You indicated at the last estimates that all of the dedicated councils, rather than there being a dedicated council for Indigenous affairs, will be taking Indigenous outcomes into account in their work and that those arrangements would start from 1 July and that MCATSIA would finalise by the end of June a process to hand over its work to the working group on Indigenous reform or to a ministerial council. I think, Ms Cross, you said previously in a response today that a number of the councils and groups under the restructure have commenced—or is it all of them?

Ms Cross : Twenty of the 22 have been formally established. I should point out that not all councils will have matters relevant to Indigenous policy within their terms of reference but a very large number do, and so that has been specifically looked at in establishing their terms of reference.

Senator PAYNE: When you say established, does that mean they have had their terms of reference finalised and their work plans established?

Ms Cross : It means they have been launched by the Prime Minister. We are in the process of finalising all of the terms of reference with a number of them already finalised and then the work plan, I think, will be formally agreed out of session in the next month or so.

Senator PAYNE: What does a launch by the Prime Minister of a council of COAG comprise; what happens?

Ms Cross : She writes to all of the relevant ministers to let them know that it has been formally established.

Senator PAYNE: So there is no cracking of champagne on the hull or anything like that.

Ms Cross : Not that I am aware of.

Senator PAYNE: How many have had their terms of reference finalised of the 20?

Ms Cross : I will just get that information for you—they have endorsed terms of reference for 20 councils and fora.

Senator PAYNE: Can you please provide on notice that list?

Ms Cross : Yes, Senator.

Senator PAYNE: Thank you. You said 20 of 22 of councils have been established. Which are the two that have not?

Ms Cross : Discussions are still continuing on the Select Council on Climate Change and the council for school education and early childhood.

Senator PAYNE: When you say discussions are still continuing, what is that in relation to? What are the issues that are delaying their establishment?

Ms Cross : The details of the terms of reference are still being worked through with state and territory officials.

Senator PAYNE: When do you expect those to be finalised?

Ms Cross : In the very near future.

Senator PAYNE: This year?

Ms Cross : Yes.

Senator PAYNE: Will they be established and launched by the end of the year?

Ms Cross : That is our intention. Again, it is dependent on reaching agreement with the states and territories.

Senator PAYNE: Just in relation to the Indigenous affairs aspect of these questions—and I expect you might need to take this on notice—can you outline for the committee the role that Indigenous affairs will play specifically in each council group or fora under the new structure, including all the work that is transferred from MCATSIA?

Ms Cross : We will take that on notice. We will certainly be able to refer you to the relevant parts of the terms of reference for councils and any information and the work plans once they are signed off.

Senator PAYNE: At the last occasion we were discussing these matters, the minister very generously indicated that I could ask more specific questions on the status of progress around a number of issues here at these estimates rather than experience Senator Faulkner's Defence versus PM&C experience, so I have a few questions in that regard as well, if I may. In the February meeting there was an agreement to establish a working group which was to be led by senior officials from first ministers and treasury agencies—I think I am quoting from the communique here—to take forward the key and related recommendations arising from the heads of treasuries, charmingly known as HoTs, review of national agreements and national partnerships and implementation plans and reports from the CRC to reinforce COAG's commitment to performance and public accountability. As an initial step the working group will review the performance frameworks of a limited number of agreements including the NAHA consistent with CRC and HoTs review recommendations and so on. Can you tell the committee more about that review; what its scope is and what sort of consultation will take place to review, in this case, the NAHA?

Ms Cross : There are a number of different agreements and national partnerships that are being reviewed by that group and they are all at different stages of progress. A number of them have commenced; at least one is almost complete.

Senator PAYNE: Which one is almost complete?

Ms Cross : The review of the National Indigenous Reform Agreement, the NIRA. Some like the health agreement and the skills agreement will be reviewed as part of ongoing negotiations on those matters with states and territories. The NAHA is due to commence later this year. They were all on different timeframes and they are all proceeding on track.

Senator PAYNE: In cases such as the NIRA, which you have referred to as being almost complete, what would be the status of the review? At any stage do they become public?

Ms Cross : That is a matter for COAG. The general intention is that most of the reports would be made public but that would be decided on a case by case basis by COAG.

Senator PAYNE: Could you on notice provide detail around the status of each of the reviews of the national agreements.

Ms Cross : Yes.

Senator PAYNE: Thank you very much. Can you also indicate in relation to that review process for each of those whether there are recommendations from the CRC from either their 2008-09 or their 2009-10 reports which are not adopted as a result of the reviews or otherwise.

Ms Cross : Yes, I will take that on notice.

Senator PAYNE: Thank you. In view of the limited time, can you indicate perhaps on notice the status of the reforms to legal professional regulation.

Ms Cross : I can take that on notice or I can give you an update at the moment if you would like.

Senator PAYNE: An update if you have it available, thank you.

Ms Cross : With the legal profession reform, New South Wales, Victoria, Queensland and the Northern Territory have confirmed their participation in the arrangements and they represent around 80 per cent of legal practitioners. There are still negotiations underway as to who will be the host jurisdiction for the new national legislation and administration body, and we are expecting that to be sorted out quite soon. Once we have the host jurisdiction, progress will get underway with establishing those new arrangements.

Senator PAYNE: What is the status regarding the other jurisdictions' participation?

Ms Cross : Western Australia and South Australia have decided not to participate at this time, and at the COAG meeting Tasmania and the ACT also indicated their intention not to participate.

Senator PAYNE: What impact does that have on the concept of national legal professional regulation?

Ms Cross : As the states that are participating represent around 80 per cent of legal practitioners it is still a good outcome for COAG because it is picking up the bulk of the profession and making sure they come under nationally consistent arrangements.

Senator PAYNE: When will the reforms expect to be in place?

Ms Cross : That will be sometime next year. It really depends on how long it takes for the passage of legislation.

Senator PAYNE: Is it expected that any of the other four jurisdictions who have currently indicated they are not participating to change their position?

Ms Cross : I am not aware of that in the short term.

Senator PAYNE: I will place the rest of my questions on notice. Thank you very much to the officers.

CHAIR: Are there any other questions in relation to outcome 1.1.1 on domestic policy?

Senator SIEWERT: I wanted to ask about the reforms the government announced during the budget for the Australian Charities and Not-for-profits Commission and get an update about where things are up to. I would like to ask about the compact and also what involvement do you have with the tax reforms? In terms of the formation of the commission, can you give us a brief update on where we are up to?

Mr Ronalds : Certainly. The work is being done and is led by Treasury in relation to the new not-for-profit regulator. They have an interim group in place headed by Susan Pascoe and they are liaising closely with the reform council and a range of other stakeholders.

Senator SIEWERT: What resources and staff are being made available in the interim process of setting up the commission? Where are the staff located?

Mr Ronalds : They are located within Treasury so it is best to direct that question to them.

Senator SIEWERT: I will be asking them. I am not talking about the tax reform; I am talking about the setting up of the commission itself.

Mr Ronalds : The commission itself is also being managed by Treasury.

Senator SIEWERT: I know we traversed this a bit last time and it was a little unclear, but can you update me now as to what role you are taking in terms of the commission.

Mr Ronalds : We are working very closely with Treasury, as part of the interdepartmental committee that has been established to provide overall oversight of the not-for-profit reform agenda. Treasury are also working very closely with the reform council. The secretariat for the reform council is managed out of the office of the not-for-profit sector so it liaises very closely with Treasury in relation to those matters as well.

Senator SIEWERT: What role do you play? How is the role of the office itself different to the role the commission is playing?

Mr Ronalds : The office's role is the overall management of the not-for-profit reform agenda. Various elements of the reform agenda are being managed by different departments. The regulator is being managed by Treasury. Our role is to ensure that the overall reform agenda is aligned and consistent with each of the elements.

Senator SIEWERT: Do you have a schema or a map for this showing who is doing what?

Mr Ronalds : Not one that I can table here, but I am certain we can provide that on notice for you.

Senator SIEWERT: What I am after is the overall schema showing how every bit of this reform is rolling out, the timelines and whether the timelines are being met. Is the commission going to be established and fully functional by 1 July 2012?

Mr Ronalds : That is correct.

Senator SIEWERT: Then all the tax reforms by 2013?

Mr Ronalds : Essentially the reform agenda is progressing in three broad parts. The first part looks at those elements that relate to the relationship between the sector and government. There is a range of different initiatives that are progressing under that, such as the Compact. That is the first part. The second part relates to the regulation of the sector—parts such as the new regulator and a range of reforms to laws associated with the not-for-profit sector. For the most part, those are being managed by Treasury. There is a third element of the reform agenda which is really about the long-term sustainability of the sector. They are primarily being taken forward by the office of the not-for-profit sector.

Senator SIEWERT: You are doing that and the Compact?

Mr Ronalds : Yes.

Senator SIEWERT: That is the relationship. So the first bit is about the government relationship with the sector.

Mr Ronalds : Exactly.

Senator SIEWERT: I will leave out the taxation staff. The third bit is about long-term sustainability.

Mr Ronalds : Exactly.

Senator SIEWERT: That is very dependent on a lot of the taxation reform processes, so how do you relate to that taxation reform process?

Mr Ronalds : Again, you are correct in that they relate very closely. As Treasury are developing reform options in relation to that regulation as they are beginning their work establishing the regulator, we are working very closely with them to ensure that it is aligned with the long-term sustainability of the sector. That is how we relate to them.

Senator SIEWERT: If you could provide me with a schema that shows those parts, who is doing what and how they relate, that would be appreciated.

Mr Ronalds : We will take that on notice.

Senator SIEWERT: Thank you. In terms of any of the taxation issues, I will need to ask Treasury about that. Is that right?

Mr Ronalds : That is most appropriate.

Senator SIEWERT: You may be able to answer one area before I move off that one. On 23 April, the then Prime Minister granted an exceptional circumstances exemption for the government's taxation reform agenda in response to Australia's future tax system, which included better targeting of not-for-profit tax concessions in a measure to reform the taxation concessions provided to the not-for-profit sector. Did you have anything to do with that or do you not look at any of the taxation issues?

Mr Ronalds : We do not have primary carriage for any of the tax issues. From the details that you have provided, I am not aware of what you are referring to.

Senator SIEWERT: For example, in terms of when you are trying to determine exceptional circumstances, whether they should be granted to development and publication of a regulatory impact statement. Are you involved in that process?

Ms Cross : We certainly have an area of the department that is involved with regulatory impact statements, in a general sense across government. That is not specifically us, but there is part of the department that looks at all RISs.

Dr de Brouwer : Questions around regulatory impact statements are really the responsibility of the Department of Finance and Deregulation.

Senator SIEWERT: Another mob I have to ask. I just need to be clear.

Senator Chris Evans: Senator, as always, if what you are after is general information, I am sure we can organise a briefing.

Senator SIEWERT: If you could, that would be appreciated.

Senator Chris Evans: If senators are after the vibe of the thing, as it were, about a new agency, we could certainly do that.

Senator SIEWERT: Could we perhaps get a briefing on that for the committee. I think Senator Moore was suggesting that the community affairs committee could get a briefing. It sits under a lot of what we—

Senator Chris Evans: Sure. There are various other departments and I know the committee is short on time, so I am sure we could organise a briefing on that.

Senator SIEWERT: That would be very much appreciated. Thank you.

Senator Chris Evans: That might allow you to get answers to some of the things that would otherwise have to go to other departments.

Senator SIEWERT: Yes.

Senator FIFIELD: Are the questions—

Senator SIEWERT: A lot of the issues relate to this particular issue and the tax issues that I have been asking about. I will still be asking some more urgent ones of Treasury, but if we could get a briefing on where things are up to that would be appreciated. That would be good. I will go to the Compact in terms of getting an update on where it is up to. How many new partners are there now under the Compact? Have there been any new ones since we were last updated?

Mr Ronalds : From memory, the figure is 598. As at 16 September 2011, 598 organisations have signed up as National Compact partners and 24 individuals have been appointed as National Compact champions. Of course, of those 598, some are themselves peak bodies. So there is a large number that sits underneath that.

Senator SIEWERT: The Compact is supposed to be about improving the relationship, as you have spoken about, between the sector and the government. Do you audit that process? What is the process for ensuring that the Compact is actually achieving that goal of improving the relationship? Do you have an example of how it has paid off?

Senator FIFIELD: Good question.

Mr Ronalds : In terms of the evaluation of the Compact, it is still too early to give any details in relation to that. Certainly, on an anecdotal basis, there is very significant positive feedback from the sector. The work of the reform council continues. They have a subgroup that deals with the National Compact and they are developing codes that sit underneath the Compact to operationalise the Compact. That is something that has been a high priority for the reform council.

Senator SIEWERT: Can we go back to the question about auditing? Is there a formal process for doing that?

Mr Ronalds : Sorry?

Senator SIEWERT: Is there a formal process for auditing the Compact to see if it is achieving? Are there milestones that have been set?

Mr Ronalds : We have not established one as yet.

Senator SIEWERT: The Compact was signed 18 months ago.

Senator FIFIELD: We should also ask where is that Compact that was signed? It did go missing for a while.

Mr Ronalds : It did, Senator. I understand it is still in Senator Stephens' office. I have not been around to check.

Senator SIEWERT: It has been signed for 18 months. Is there a plan to do some sort of audit to ensure that it is actually delivering, besides developing up the codes et cetera?

Mr Ronalds : There is no current plan.

Senator SIEWERT: In terms of the codes that are being developed—and maybe this will come up in the briefing—how does that relate across to all the other reforms that are going on in this space? We have already got the three things happening. There is the reform council and we have already been through the other bits. How are those codes relating to, for example—and I asked this last time—report once, use often, the gateway et cetera?

Mr Ronalds : To further operationalise the Compact, there have been at the deputy secretary level champions of the Compact appointed by each department. They are listed on the not-for-profit website. They provide a point of contact for any not-for-profit dealing with an agency to follow up issues if they are concerns about the relationship between that department and the not-for-profit. So that is an example, if you like, of ways that it is being operationalised. Then, as I said, there are these other codes that sit underneath the Compact that will also do that. All of those sit under that first head of reform, which is looking to reform the way that government and sector work with one another. There is other work under that as well.

Ms Cross : One of the goals of the office in PM&C is to make sure that those different bits do fit together as an integrated package rather than becoming separate or not reinforcing each other. That is part of the role of the Office for the Not-for-Profit Sector in PM&C.

Senator SIEWERT: Okay, but we do not have a process for auditing the Compact and how then it relates to all those. I would have thought that some of the issues around the Compact and the relationship between the sector and the government will very much depend on the other sections of the reform process. If there is no auditing process, how do we know whether it is delivering?

Ms Cross : In the initial states, we are focusing on getting those new arrangements in place and getting the different bits of work that we referred to in the PC report underway. There will then be monitoring of progress against each of those commitments. Once they are fully implemented, we would look to consider how we look at the effectiveness of them. But, at this point in time, we are still very much in the early stages of getting the work underway and getting the different pieces of reform in place.

Senator SIEWERT: We have been going for 18 months now—what is your time frame?

Ms Cross : Again, each element of the reform is operating on a different time frame. Some bits, like getting codes established and putting in place the advocates in each department, have been done. Other bits will take longer. But, again, when we give you the schema, we can give you some sense of the different pieces of work that are underway and any that have already been completed.

Senator SIEWERT: I would appreciate the outline before we get the briefing, because I imagine the briefing is going to take place a little bit down the track, but could the discussion of that be included in the briefing?

Ms Cross : Yes.

Senator SIEWERT: Thank you. In terms of the ongoing work with long-term sustainability, the third arm that you were talking about, have you got a plan for that—have you got a framework for how that is going to work?

Mr Ronalds : There are a range of different elements that sit underneath that. For example, there is work being undertaken in relation to volunteering, the office has been involved in work in relation to capital markets for the not-for-profit sector and there is work going on in relation to workforce issues and those sorts of things.

Senator SIEWERT: Are there time lines for each of those?

Mr Ronalds : There are, although that section by its nature has the longest time lines. We can provide that as part of the briefing.

Senator SIEWERT: If you could provide that as well, I would appreciate it. How are you progressing on establishing the commission and making sure that it is functional by 2012? Are you going to meet the 1 July deadline?

Mr Ronalds : I understand it is all on track.

Senator SIEWERT: I will follow you up in terms of getting the briefing because I would prefer to have it sooner rather than later.

CHAIR: We are now going back to the Domestic Policy group.

Senator FIERRAVANTI-WELLS: I would like to ask some questions in relation to the National Mental Health Commission. At the last estimates, I asked some questions of Mr Rimmer in relation to the commission, and at that stage he was unable to tell me the number of commissioners. Shortly thereafter, on 1 June, Minister Butler issued a release talking about the appointment of Ms Robyn Kruk as the CEO designate of the new commission. I will ask up-front: who is actually driving this? It has been put in the Prime Minister's department. Who has been responsible for these appointments?

Mr Eccles : The Department of the Prime Minister and Cabinet is responsible for setting up the agency, and it will be an agency within the portfolio.

Senator FIERRAVANTI-WELLS: So the Prime Minister's department was responsible, or the Prime Minister was responsible, for the appointment of Monsignor Cappo as the first national mental health commissioner?

Mr Eccles : Yes, it was a government appointment.

Senator FIERRAVANTI-WELLS: Driven out of the Prime Minister's office. Did the Prime Minister herself or the Prime Minister's office contact Monsignor Cappo about the appointment?

Mr Eccles : I do not know the answer to that. I will have to take that on notice. I believe the answer is yes, but I will need to confirm that.

Senator FIERRAVANTI-WELLS: I would have thought that it would be foremost in your mind, given the publicity that it has had. Was there a shortlist of suitable candidates?

Mr Eccles : No, the appointment process was much as is the case with appointment processes for other agencies. The government decided in the first instance that Monsignor Cappo was an appropriate chair.

Senator FIERRAVANTI-WELLS: So there was no consultation with the sector in relation to possible appointments?

Mr Eccles : No. The minister, as you know, meets quite regularly with stakeholders. Those discussions, his knowledge of the sector and advice that he sought certainly would have influenced the considerations leading to the government decision around the chair.

Senator FIERRAVANTI-WELLS: So Minister Butler recommended, or suggested, Monsignor Cappo?

Mr Eccles : There were discussions between the Prime Minister and Minister Butler. It was a decision of the government—a cabinet decision, essentially. These are significant appointments and, as you understand, these matters go before cabinet.

Senator FIERRAVANTI-WELLS: Okay. So the process for selecting him was simply as a consequence of a discussion between the Prime Minister and Minister Butler. That is how, as I understand it, it came about.

Mr Eccles : No, I did not say that, Senator. I think a fair characterisation of this is much like any significant appointment that government makes. There are discussions within government—soundings are no doubt taken through the stakeholders and the broader community that is impacted by these things—and a whole range of factors influence the decision that is then taken to cabinet.

Senator FIERRAVANTI-WELLS: In making the announcement on 7 September Minister Butler refers to 'greater transparency and accountability'. I am looking for some transparency in relation to this appointment in particular, given the various issues that have now emerged about Monsignor Cappo and issues that were already in the public arena before his appointment. So I ask you again: what was the basis upon which Monsignor Cappo was deemed to be 'the obvious choice' both in comments that appeared in the media by a spokesperson for Minister Butler, and by comment made by Minister Butler himself? Why was Monsignor Cappo the obvious choice, given the history that Monsignor Cappo has had—even leaving aside the comments that Senator Xenophon made in the Senate?

Senator Chris Evans: Can I ask you to show some restraint? I do not know what you are suggesting but I am not sure that blackguarding people's names with unspecified criticism is appropriate.

Senator FIERRAVANTI-WELLS: I am simply quoting the minister.

Senator Chris Evans: I am happy to let you know that this is a decision of government. The appointment was made by government. Minister Butler supported that decision in his press release referring to the appointee's credentials. I do not know quite what you are alleging or saying now but the government takes responsibility for the appointment. It was a government appointment that was supported and announced by the minister. That is correct.

Senator FIERRAVANTI-WELLS: I am just questioning the process by which Monsignor Cappo was appointed, in light of the history surrounding Monsignor Cappo.

Senator Chris Evans: I think you are not questioning the process; you are questioning the man. The process was the normal government process.

Senator FIERRAVANTI-WELLS: I am questioning, Minister, that he has been described in both Minister Butler's words, and in the words of his office, as 'the obvious choice'. My question is: why was he the obvious choice and why was there not some sort of consultation to look at other alternatives to Monsignor Cappo?

Senator Chris Evans: As the officer indicated, the normal processes applied for government decision-making. The minister is heavily engaged in the sector and talks to all the interest groups on a regular basis. This is a decision of cabinet which recognised Monsignor Cappo's long engagement and interest in the field. The minister rightly supported the announcement of the appointment. That is just a matter of fact. If you want to make allegations about the person I guess that is up to you, but the appointment was made in the normal way.

Senator FIERRAVANTI-WELLS: Was the Prime Minister aware, when the decision was made, that Monsignor Cappo—this was well documented in media reports over quite some period of time—had quite some controversy attaching to him? Was the government aware when it made that appointment?

Mr Eccles : I do not quite understand it. What in particular? There were significant controversies that came to light after the appointment. I am not sure what you are referring to concerning controversies before his appointment. Maybe you could give me a little bit more information?

Senator FIERRAVANTI-WELLS: Perhaps in the avalanche of media reports after his appointment, there had been a whole series—time precludes me from going through each of those media reports—of constant criticism of Monsignor Cappo across a whole range of different areas, in particular associated with his work in South Australia. My question is: was the government not aware of any negative commentary about Monsignor Cappo, such as to dissuade it from appointing him?

Mr Eccles : I do not know the answer to that. What I do know is that a lot of the publicity that surrounded Monsignor Cappo came to the fore after his appointment, so I am not exactly sure what you are talking about. I am not trying to be difficult. I think the minister mentioned that Monsignor Cappo was recognised as having a very strong track record in social policy. He was a member of the Mental Health Expert Working Group and the National Advisory Council on Mental Health. These were the reasons behind the consideration that he was a suitable appointment.

Senator FIERRAVANTI-WELLS: He was also somebody who Minister Butler worked for, I understand, during his time in South Australia, if records are correct in that respect. Was that a feature?

Mr Eccles : No, not in my understanding. I do not understand that he did.

Senator FIERRAVANTI-WELLS: But we do not know who suggested him, that it was Minister Butler or the Prime Minister herself. There is a suggestion here that he seems to have caught the Prime Minister's eye at one of the—

Senator Chris Evans: I would not rely on everything you read in the papers.

Senator FIERRAVANTI-WELLS: I am relying on what Mr Butler has said about Monsignor Cappo and I am questioning the appointment of Monsignor Cappo in light of his history.

Senator Chris Evans: His history includes being chair of the Social Inclusion Board of South Australia, a qualified social worker and his experience on the Mental Health Expert Working Group and the National Advisory Council on Mental Health. It was those qualifications and experiences that led to him being appointed by government to the role.

Senator FIERRAVANTI-WELLS: I will put further questions on notice and in particular Mr Eccles I will detail the various media reports that I was referring to. I trust that will be dealt with.

Senator Chris Evans: I can get the clips myself, senator. Do not bother. I can get the clips myself if it saves you research time.

Senator FIERRAVANTI-WELLS: I am happy to put them on the record for the department. When did Monsignor Cappo formally accept the position as the Mental Health Commissioner?

Mr Eccles : On 7 September.

Senator FIERRAVANTI-WELLS: And was he informed by the minister or the Prime Minister's office?

Mr Eccles : I would need to check but I have a feeling that he was informed by the minister. I will check on that.

Senator FIERRAVANTI-WELLS: What was the process for selecting Professor Fels. As much as I respect Professor Fels, was he just a second-string candidate for this position?

Mr Eccles : I am sorry, are you asking me if Professor Fels was a second-string candidate?

Senator FIERRAVANTI-WELLS: How did you come across his name?

Mr Eccles : Professor Fels has a very strong track record in working with government on a whole range of issues. As you know, he is currently Dean of the Australia and New Zealand School of Government; he was Chairman of the Australian Competition and Consumer Commission from 1995 to 2003; he has a good understanding, a strong background and a deep interest in mental health issues. Professor Fels is obviously very well qualified for the position. The process around his appointment is, as I outlined earlier, not dissimilar to any other significant appointments that governments make. It was a decision of the cabinet.

Senator FIERRAVANTI-WELLS: Can you tell me what the remuneration is for Ms Kruk, and for the position of the National Mental Health Commissioner?

Mr Eccles : Ms Kruk will commence her role as CEO on 1 January and we are currently going through discussions with the Remuneration Tribunal around the salary and the conditions.

Senator FIERRAVANTI-WELLS: Will it be based here in Canberra?

Mr Eccles : No, it will be based in Sydney.

Senator FIERRAVANTI-WELLS: I see. So she will be based in Sydney, will she?

Mr Eccles : Yes.

Senator FIERRAVANTI-WELLS: What was the selection process surrounding Ms Kruk? Will you take that on notice? Was the position advertised?

Mr Eccles : No, Senator. Ms Kruk was appointed in a manner consistent with the merit processes of the Australian Public Service.

Senator FIERRAVANTI-WELLS: Perhaps you would like to detail what that process was.

Mr Eccles : Of course.

Senator FIERRAVANTI-WELLS: Could you also tell me when the position was offered to her. I am conscious of time, so I will put the rest of my questions on notice.

Senator FIFIELD: I have a quick follow-up on Monsignor Cappo—this may actually be a question for the Not for Profit Office—in relation to Monsignor Cappo's membership I think as Deputy Chair of the Commonwealth Social Inclusion Board. Are you able to answer that?

Ms Cross : I can answer those questions.

Senator FIFIELD: I understand Monsignor Cappo has resigned from the Social Inclusion Board: is that correct?

Ms Cross : That is correct.

Senator FIFIELD: When did the government receive his resignation?

Ms Cross : It was at the same time as he resigned from the Mental Health Commission. It was 15 September.

Senator FIFIELD: So it took effect immediately?

Ms Cross : Yes.

Senator FIFIELD: Okay, thank you for that. The last I checked the website of the Social Inclusion Board Monsignor Cappo was still listed. Mind you, it was probably a week ago that I last had a look.

Ms Cross : We will undertake to have that updated.

Senator FIFIELD: You might want to check that. Has the government found a replacement for Monsignor Cappo?

Ms Cross : Not at this point in time.

Senator FIFIELD: What is the process for that: is it a matter of ministerial or cabinet appointment? Will it be advertised?

Ms Cross : It is more likely to be an internal appointment process for the government; much the same as the process Mr Eccles outlined for the Mental Health Commissioner.

Senator FIFIELD: Thank you for that. Could you take on notice any travel expenses by Monsignor Cappo during his time on the Australian Social Inclusion Board, and provide a breakdown of domestic, international, hospitality, accommodation?

Ms Cross : Yes.

Senator FIFIELD: Thank you.

Senator ABETZ: Has a Mr Jack Lake been appointed to the Prime Minister's office in recent times to assist in the area of the live export issue?

Dr de Brouwer : This is really a matter for the Prime Minister's office. He worked in the Prime Minister's office and I think that appointment is now finished.

Senator ABETZ: It was for a short-term contract, was it?

Dr de Brouwer : That is my understanding.

Senator ABETZ: For how long?

Dr de Brouwer : I do not know those details. I could take it on notice.

Senator ABETZ: You can confirm that he was appointed; we do not know for how long, but that it was for the live export situation?

Dr de Brouwer : For a range of matters.

Senator Chris Evans: I think he is actually working somewhere in the public service.

Dr de Brouwer : He is working now in the department of regional Australia.

Senator Chris Evans: I assume it would have been a secondment.

Senator ABETZ: So he was seconded out of a department into the Prime Minister's office?

Senator Chris Evans: I am just guessing; I am trying to be helpful. I suspect he was seconded but we will take it on notice.

Dr de Brouwer : As a MOPS officer, though. As a member of parliament staff, not as a departmental liaison officer.

Senator ABETZ: Yes, so he was a department official and then he got seconded onto the personal staff of the Prime Minister. Is that correct?

Dr de Brouwer : I believe so.

Senator ABETZ: His main task was to deal with the issue of the live export?

Dr de Brouwer : I believe so.

Senator ABETZ: All right. Thank you for that. Any other issues on that I will put on notice. Can I then move to the intergovernmental agreement on forestry in Tasmania. Who was in charge of the negotiations: was it you, Mr Shevlin?

Mr Shevlin : Which negotiations are you referring to, please?

Senator ABETZ: That saw Ms Gillard and Ms Giddings sign an intergovernmental agreement.

Mr Shevlin : The intergovernmental agreement was preceded by heads of agreement between the Prime Minister and the Premier.

Senator ABETZ: Were you involved in both?

Mr Shevlin : Not the heads of agreement directly, no.

Senator ABETZ: So you came in after the heads of agreement were signed.

Mr Shevlin : I was doing some work—a number of departments were doing work in advance of the heads of agreement looking at possible measures that could be used to assist the process in Tasmania.

Senator ABETZ: So was your task to liaise with various interested parties?

Mr Shevlin : As part of the development of the intergovernmental agreement?

Senator ABETZ: Yes.

Mr Shevlin : Developing that was largely a process working with the Tasmanian government, because it was an agreement between the two governments.

Senator ABETZ: Did the Commonwealth check out for itself the terms of the heads of agreement and then the intergovernmental agreement as to whether it was good policy or bad policy, whether it was what people wanted or did not want?

Mr Shevlin : The job of developing the intergovernmental agreement was to give effect to the heads of agreement, which had included a number of commitments by the two governments. So we worked together with senior officials of the Tasmanian government to develop an intergovernmental agreement to give effect to those measures.

Senator ABETZ: Did you have any discussions with interest groups, such as forestry union, forestry industry association, contractors, Timber Communities Australia, the Tarkine coalition?

Mr Shevlin : The one discussion we had directly with a number of groups was when during the negotiation of the intergovernmental agreement all of the various signatory parties were brought together and provided with a draft of the intergovernmental agreement and were talked through some of those issues. That to my recollection was the main time that we actually spoke to any others as officials. I am not aware of any other discussions that might have happened by officers.

Senator ABETZ: Rather than particular interest groups, what about particular parliamentarians, such as Senator Bob Brown?

Mr Shevlin : That is not something that officials would have been involved in.

Senator ABETZ: In relation to the heads of agreement that were signed up, was there a substantial difference between the heads of agreement and the actual intergovernmental agreement?

Mr Shevlin : I do not believe so. The intergovernmental agreement was really putting the flesh around the bones of the heads of agreement, which made certain commitments to work together, and the intergovernmental agreement sought to put the details around those and some of the implementation arrangements. But I believe the job we had was to make sure that they were consistent. We certainly did our best to achieve that.

Senator ABETZ: If officials were not involved in discussions with any parliamentarians, Minister, can you take notice whether the Prime Minister was involved in a discussions with any parliamentarians, in particular one who may have been advocating on behalf of a donor to his political party of $1.6 million who was anxious for this intergovernmental agreement to go through so that they could be a bargain priced purchases of the Triabunna woodchip mill?

Senator Chris Evans: Without responding to what is clearly a loaded question, I can say that I will take on notice the question about whether there are any negotiations involving other members of parliament. I assume you mean the Commonwealth parliament. Obviously they are in negotiations with the Premier of Tasmania. I will take it as being members of the Commonealth parliament. I will take on notice the question and see whether there is any information we can give you.

Senator ABETZ: I know you have all-pervasive influence, Minister, but I thought we could assume it would be just a Commonwealth parliament.

Senator Chris Evans: I was just double-checking. I do not know whether there was a COAG process you are interested in.

Senator ABETZ: No. You would have heard the questions asked by Senator Brown of Senator Ludwig during question time in relation to this particular matter, ensuring that no Commonwealth money would go to certain interested parties in relation to the purchase of the Triabunna woodchip mill, which was predicated on the intergovernmental agreement being finalised to the satisfaction of Gunns and wanting to see off the field another competitor for that woodchip mill. If you could take that on notice I would be much obliged.

Mr Shevlin are you saying that, with this intergovernmental agreement, you basically followed, or responded to, requests and suggestions from the Tasmanian government, as opposed to putting proposals on the table from the Commonwealth perspective?

Mr Shevlin : No, I did not mean to suggest that. It was a negotiation between two governments to work out the detail of giving effect to a high-level commitment which was in the heads of agreement. There are a whole range of issues that we negotiated. There were a number of issues we did not immediately agree on, and we had to work through those over a period of a couple of weeks.

Senator ABETZ: Would you agree with me that the heads of agreement started off as a document, I think, known as the statement of principles being submitted to the Commonwealth for its consideration. It was not that the Commonwealth had a document headed statement of principles that it submitted to the state for its consideration. Are we agreed that these discussions were state initiated?

Mr Shevlin : No, the statement of principles was a document developed by the various parties in Tasmania. When I say parties, I mean the environment groups—

Senator ABETZ: Interest groups.

Mr Shevlin : Interest groups. So the statement of principles emerged from that process. After that process had run some way, the signatories to the process actually requested that governments become actively involved in supporting the implementation of the statement of principles. That led to the heads of agreement initially and then, two weeks later, to the intergovernmental agreement.

Senator ABETZ: So when did the Commonwealth first become involved in this issue?

Mr Shevlin : The Commonwealth had been supportive of the statement of principles process, had provided some assistance in terms of facilitation for the signatories to that process to continue their work together and had actually provided some support.

Senator ABETZ: What of sort of assistance?

Mr Shevlin : Mr Bill Kelty assisted in facilitation on a pro bono—

Senator ABETZ: He was paid by the Commonwealth?

Mr Shevlin : No, he did his work on a pro bono basis. We did provide some support for his secretariat, so we provided some assistance for—

Senator ABETZ: How much did that cost? Take it on notice; I do not need to know now.

Mr Shevlin : I do have the figure here. I believe it was just over $69,000.

Senator ABETZ: Are you aware that a number of the parties have since walked away from the intergovernmental agreement, because they believe it does not reflect the statement of principles and the discussions that were held prior to the intergovernmental agreement being announced?

Mr Shevlin : In fact all of the parties, the signatories to the statement of principles, are still actively engaged in the process. They are all members of a reference group of signatories that we meet with regularly. In fact, we met with them as recently as last Thursday. So all those signatories are still very much part of the process in continuing to work towards the implementation of the intergovernmental agreement and various elements within that. I do not think it would be accurate to say they have walked away from it.

Senator ABETZ: I believe that, for example, FIAT—the Forest Industries Association of Tasmania—say that they have been betrayed in relation to the intergovernmental agreement. I believe that Timber Communities Australia and other organisations are similarly saying that the intergovernmental agreement does not represent that which they believed would be signed up. Were you involved in any discussions with state members of parliament in relation to the negotiations when Ms Gillard was in Hobart trying to finalise the issues?

Mr Shevlin : I believe that was in the lead up to the heads of agreement, and I was not.

Senator ABETZ: Was there somebody from the department there?

Dr de Brouwer : Not that I am aware of. I will take that one on notice.

Senator ABETZ: Yes, take it on notice, because there is the suggestion that the leader of the Greens in Tasmania, Mr McKim, partook and things got changed. What is the Commonwealth's view in relation to any moneys that it might pay? Will those monies be only payable if the 500-and-something-thousand hectares is locked up?

Mr Shevlin : No; there are a range of payments within the intergovernmental agreement. There are amounts set out within that to the total of $277 million. Some of those payments are being made immediately. For example, assistance-to-workers payments started to be available and made as soon as the intergovernmental agreement was signed—that is, from 7 August. There was other money—for example, $43 million to the Tasmanian government to assist in the facilitation of the agreement which was paid and transferred on 7 October. There are, though, some payments which are contingent upon the Tasmanian government ultimately putting in place legislation to protect those areas of forest which are found to be compatible with guaranteed wood supply, and that legislation is required to be introduced by 30 June 2012. If it is not passed by three months later, then some payments will not be made.

Senator ABETZ: The legislative council has already indicated a particular stance. Time is short—Minister, could you take on notice whether any direct representations were made to the Prime Minister in relation to the intergovernmental agreement by the member for Lyons, the member for Bass, the member for Franklin or the member for Braddon?

Senator Chris Evans: I will take that on notice. I am not sure whether I regard conversations or representations between a member of the House of Representatives and the Prime Minister as something that one would necessarily report at estimates, but I will take the question on notice.

Senator RYAN: Can I turn to the issue of Prime Minister's exemptions from OBPR processes. I questioned the department of finance about this at budget estimates, and I am wondering if I could be provided with or have explained to me the criteria for the granting of a Prime Minister's exemption, if indeed there are any.

Dr de Brouwer : Sorry, Senator—the question was: what are the grounds for the granting of Prime Minister's—

Senator RYAN: What are the criteria for a Prime Minister's exemption being applied to the normal processes of the OBPR.

Dr de Brouwer : My understanding is that there are no formal criteria, but I will come back to provide the answer on notice. It is usually if there are matters of urgency that that is the standard rubric under which those exemptions are granted. I will come back if there are specific legislative—

Senator RYAN: I will place some questions on notice about this with respect to whether or not any criteria were applied to a number of things that do not appear to have met the criterion you have just mentioned, which is urgency, including the response to Australia's future tax system—the Henry review—and the government's response to the NBN implementation study. I understand the criterion of urgency has its place, but neither of these seemed to strike me as a case of particular urgency. How is an exemption effectively applied for and requested? Is it from the minister to the Prime Minister? Is it from the minister through the OBPR to the Prime Minister?

Dr de Brouwer : It is from the minister to the Prime Minister—directly by correspondence from the minister to the Prime Minister.

Senator RYAN: And that is something that presumably goes via the department, in the sense that you are the relevant department?

Dr de Brouwer : Yes.

Senator RYAN: And that is something you provide advice to the Prime Minister about—whether your view on the request is a valid one or not?

Dr de Brouwer : Yes.

Senator RYAN: So what criteria do you use to determine whether or not a request has sufficient grounding?

Dr de Brouwer : That would depend on the specifics of the particular case. But in general it is a matter of the urgency around that particular form of legislation or the confidentiality or the ability to publicly communicate—

Senator RYAN: Do you have anything that would provide a less subjective guide to what criteria the department applies with respect to making a recommendation to the Prime Minister about a ministerial request?

Dr de Brouwer : I think those things are generally based on principles, but they are always applied on a subjective basis.

Senator RYAN: What are the principles? Do you have something in writing—some principles that I could refer to?

Dr de Brouwer : No, it is really on a case-by-case basis.

Senator RYAN: To be fair, we have talked about that and you have said that there were criteria upon which you made a decision but that it was done on a case-by-case basis. Then you said that there are principles. What I am after is: what are those principles? Presumably you do not look at every request without a reference to another particular request, without reference to previous requests and whether they have been granted, or without reference to whether it is consistent with good regulatory practice. Presumably the department has a view on that as well.

Dr de Brouwer : The basis is that in general we are a strong supporter of the regulatory impact statement process. That is an important public policy tool, so there has to be a strong case for overruling that.

Senator RYAN: So these are not decisions of cabinet, are they? They are a Prime Minister's personal decisions in his or her capacity as Prime Minister.

Dr de Brouwer : Yes.

Senator RYAN: To pick one of the various exemptions that have been granted—the Australian government's response to the super system, the Cooper review—why was an exemption to that granted?

Dr de Brouwer : We do not disclose our advice to the Prime Minister on particular issues. I am happy to talk in general about how we frame our response and our advice.

Senator RYAN: On what particular ground are you asserting immunity? We all know that advice to ministers is not a claim—

Senator Chris Evans: To be fair to the officer, he does not know on which grounds the cabinet made the decision.

Senator RYAN: We had that clarified a second ago.

Senator Chris Evans: Sorry, I meant the grounds on which the Prime Minister made the decision. I am just saying that it was not Dr de Brouwer's decision. He is happy to talk to you about the general way they frame advice.

Senator RYAN: But it has been made clear to us that the department comes up with a recommendation.

Dr de Brouwer : We do not provide the details of our advice to the Prime Minister.

Senator RYAN: Says who? Says you, but that is not grounds on which advice cannot be provided. We go over this every estimates, and I am sure we will be going over it for as long as I am here. But the mere fact that it is advice to a minister—in this case the Prime Minister—is not sufficient grounds for something to not be discussed or otherwise aired at this committee.

Dr de Brouwer : I am happy to go through the general framing of how we provide our advice, but on specific issues that would reveal what our specific advice to the Prime Minister is. We do not entertain, in this way, talking about our particular advice to the Prime Minister on an issue.

CHAIR: Senator Ryan, do you have much more on outcome 1.1.1?

Senator RYAN: We will have more on 1.1.1 after the break.

CHAIR: Before we go to a break, this committee has asked on a number of occasions at other estimates if—some of us are obviously ageing faster than others!— the printing on the nameplates can be larger. I strongly urge that, for the next estimates, the Department of the Prime Minister and Cabinet come back with larger fonts on their nameplates.

Proceedings suspended from 18:31 to 19:48

Senator RYAN: Continuing the line of questioning I was on earlier, in regard to any of the exemptions granted by the Prime Minister, does the department as a matter of course undertake any impact assessment, cost-benefit analysis or stakeholder consultation before a Prime Minister's exemption is granted?

Dr de Brouwer : Not the department. There are processes designed to do—

Senator RYAN: I appreciate that; I was just wondering—

Dr de Brouwer : We do not do anything apart from having our normal contact when we are getting information around a topic from relevant departments.

Senator RYAN: So, if there has been a request to the Prime Minister in writing, you effectively just process that request and provide advice to the Prime Minister, as opposed to undertaking any—

Dr de Brouwer : Particular new process—that is right.

Senator RYAN: I have got some questions now which I assume are for here but they might be in 1.1.2. They relate to the Prime Minister's telephone conversation with the Ambassador to Indonesia that was in the media a few weeks ago.

Senator Chris Evans: We appreciate the cooperation of the officer back with us.

Senator RYAN: Could you take me through, Dr McCarthy, if it is appropriate to ask you, what steps were taken by the department to arrange that phone call? Was there any contact from the Prime Minister's office to the department regarding making an arrangement for that phone call?

Dr McCarthy : No, Senator.

Senator RYAN: So there was no communications at all between the Prime Minister's office and the Department of the Prime Minister and Cabinet about a potential phone call being made to the ambassador?

Dr McCarthy : We have provided advice on this particular issue but not in respect of the particular phone call.

Senator RYAN: Did that advice provide a phone number on which to call the ambassador? What I am trying to get at here is—

Dr McCarthy : We would not have needed to provide that advice.

Senator RYAN: I am not as familiar with the internal operations of our Department of Foreign Affairs and Trade. So how would the Prime Minister go about getting hold of the phone number for the Ambassador to Indonesia?

Dr McCarthy : The Prime Minister's office would have access to those details—her international adviser, for example.

Senator RYAN: And they would be obtained through the department or through the Department of Foreign Affairs and Trade?

Dr McCarthy : They could be obtained through the Department of Foreign Affairs and Trade.

Senator RYAN: What you are saying now because this is going to be pursued later in the week is that—

Senator Chris Evans: Senator, I would be very surprised if the Prime Minister's international affairs adviser did not have the phone numbers of every ambassador certainly in key posts like Indonesia.

Senator RYAN: I appreciate that.

Senator Chris Evans: I am just saying: I do not think they need to go looking for them. It would be part of that person's regular duties.

Senator RYAN: You said you provided some advice to the Prime Minister on this issue which I do not find surprising. But you provided no advice with respect to the telephone call that was made from the Prime Minister to the ambassador. Advice might include the availability of the ambassador to receive a phone call, the location of the ambassador when a phone call was to be made. No advice was provided about this phone call.

Dr McCarthy : Not this particular phone call, but it is not at all unusual for the Prime Minister to make phone calls to ambassadors, particularly in relation to sensitive consular cases, and they do not necessarily need to be arranged through the department.

Senator RYAN: I am just wondering because there seems to have been some timing to this phone call—it could be accidental, it could be pot luck—and whether or not advice was provided with respect to a time to call the ambassador when he was dealing with the Australian in consular distress, if I could put it that way.

Dr McCarthy : As I said, there was no specific advice provided on this call but I understand that the Prime Minister had a schedule to call with the ambassador.

Senator RYAN: When was that scheduled call arranged?

Dr McCarthy : As I have indicated, the department was not part of arranging the phone call, so I do not have those details.

Senator RYAN: That is handy to know. Minister, can you take on notice when that scheduled phone call was arranged from the Prime Minister to the ambassador?

Senator Chris Evans: Yes, Senator.

Senator RYAN: Thank you. That is all I have on 1.1.2.

CHAIR: So 1.1.1 we have finished with.

Senator RYAN: I had that under 1.1.2 as well.

[19:53]

CHAIR: As we have finished with that area now and we will move to 1.1.2? We have the capacity to deal with the whole-of-government cyber policy. Anything there? Anything with the national counter-terrorism committee secretariat? Nothing there. We can move onto 1.1.3, strategic policy implementation—anything there? If not, 1.1.4: support services for government operations, cabinet support—is there anything there?

Senator RHIANNON: I wanted to move onto health privacy. Health privacy rules promised as part of the first tranche of the Privacy Act amendments are some of the issues that I want to cover. Why has the government proceeded with the introduction of individual health identifiers and electronic health records without ensuring that an appropriate health privacy framework was in place first; and also what stage has been reached in the government's consideration of health privacy rules?

Ms Leon : The question is one that partly will be able to be answered here and partly will need to be addressed to the Department of Health and Ageing, which has carriage of the health issues that you have raised.

In relation to where the privacy reforms are up to, as you would be aware the government has provided two exposure drafts on aspects of the privacy reforms to the relevant Senate committee, which has reported on both of those. Those drafts will now be subject to some amendments in response to the committee recommendations. In relation to health reform, it is likely that the health reforms will be drafted subsequent to the reforms that are currently the subject of committee consideration and redrafting in response to those committee reports.

Senator RHIANNON: Can you tell us when that will happen, please?

Ms Leon : We do not have an exact date for that yet.

Senator RHIANNON: When will you determine that date? As you know, these things so often fall by the wayside. Do you have some framework for it?

Ms Leon : It certainly is not falling by the wayside; it is receiving very active consideration. But exactly when it will be drafted will depend on the range of other legislative drafting priorities that are with the Office of Parliamentary Counsel.

Senator RHIANNON: When you say 'other legislative drafting priorities' you do not mean in this area; you mean—

Ms Leon : No, I mean legislation generally. Getting a slot in the parliamentary drafting program does depend on the legislative priorities across the whole—

Senator RHIANNON: Is that the only thing holding it up?

Ms Leon : Certainly getting it drafted will depend upon resources in the Office of Parliamentary Counsel.

Senator RHIANNON: Are there other matters holding it up, though? You have shifted it over to the drafting office, but are there other matters internal that are holding it up?

Ms Leon : There is work proceeding, as I indicated, on the response to the committee reports on the two exposure draft bills that have already been considered, and that is certainly taking the bulk of the attention of the relevant people.

Senator RHIANNON: Can you confirm that the privacy and FOI branch of your department is being moved back to the Attorney-General's Department and could you explain why this is happening?

Ms Leon : Yes, that is the case. As you may be aware, both privacy policy and FOI policy were in the Attorney-General's portfolio originally. They came to the Department of the Prime Minister and Cabinet principally because the government had made a commitment to do broad reform to freedom of information laws. In the context of that being a significant whole-of-government activity that affects every portfolio, it was thought appropriate that that should be moved to the Department of the Prime Minister and Cabinet while those reforms were undertaken. The reforms to freedom of information have now been completed and are embedded in the implementation stages, and now it is an appropriate time for the implementation function to go back to the Attorney-General's Department.

Senator RHIANNON: Is that work that has been done the justification for the cut in staffing levels?

Ms Leon : No. The entire branch is moving across to the Attorney-General's Department.

Senator RHIANNON: Could you tell me the numbers that are currently in that section?

Ms Leon : Seven.

Senator RHIANNON: Seven?

Ms Leon : And seven will move back to Attorney-General's.

Senator RHIANNON: Was it seven when it came over?

Ms Leon : No, it was 10 when it came over.

Senator RHIANNON: So why was the cut? There has been a cut in the time that it has been in the Department of the Prime Minister and Cabinet.

Ms Leon : The reforms to FOI, as I said, have been completed now, and that was a significant body of work that that branch was doing.

Senator RHIANNON: So that is why the cut has occurred?

Ms Leon : It has not been a cut so much as over time priorities shift and staff are either moved around or not replaced as positions fall vacant. So over a period of four years a reduction of two or three people is not unusual in an area with changing priorities.

Senator RHIANNON: But, considering commitments such as the consultation on a private right of action, shouldn't the government be at least retaining the staffing levels or even supplementing the resources of the branch rather than this cutback? There has been a reduction, whatever the reason.

Ms Leon : Within those existing resources of the branch, the branch has successfully produced a comprehensive discussion paper on the statutory course of action. So the numbers in the branch are adequate to enable them to perform their duties.

Senator RHIANNON: Earlier this month the Minister for Privacy and Freedom of Information announced a review of the freedom of information fees and charges by the Australian Information Commissioner. The wording was interesting and talks about a review to consider 'the financial costs to the taxpayer of processing these requests'. I think a lot of people interpreted that as code for an increase in costs. Can you comment on what is going to happen to the fees and, if it is an increase, what do you understand the impact will be?

Ms Leon : The terms of reference for the review are designed to cover the whole range of issues that need to be considered. There is no predisposition as to a particular outcome. The review is being conducted by the Information Commissioner and the government has not received his report yet, obviously, so has not made any decision as to what the outcome of that review will be.

Senator RHIANNON: You are saying that you do not have a view about whether these fees will go up or down.

Ms Leon : We are awaiting the report of the commissioner.

Senator RHIANNON: Would you acknowledge that increased fees can deter people from using this important service?

Ms Leon : I am sure that all those issues will be taken into account by the Information Commissioner in conducting the review.

Senator RHIANNON: I would like to talk about the exemptions from freedom of information. I imagine that you are aware that many other jurisdictions do cover their intelligence services. The CIA is covered by FOI, and the British Secret Service is. In Australia, ASIO is exempt. Why is ASIO exempt?

Ms Leon : Both the existing and the previous government have taken the view that the nature of intelligence information is such that it ought not to be exposed to public scrutiny.

Senator RHIANNON: Is not the best practice within FOI that one should exempt documents not departments?

Ms Leon : The government has taken the view that I spoke of, and I do not know that I can add any more to that.

Senator RHIANNON: Parliamentarians and parliament are also exempt. Is it your understanding that that is unusual within the common practice that is developing as FOI is improving in many democratic jurisdictions?

Senator Chris Evans: Senator, I suggest that it is not fair on the officer to have a policy debate. She has the job of implementing government policy. The question of the appropriateness of FOI laws is a question for the parliament and, obviously, the government has to defend its position. The officer can help you with information regarding how the policy has been applied but you are putting her in a difficult position by asking her to express opinions about alternative policy options.

Senator RHIANNON: I would be happy to hear from you, Minister. You are obviously party to these decisions. It would be disappointing to use the excuse of policy as a reason not to comment on it, considering Australia is in quite an exceptional situation, which is clearly holding back an improvement in FOI standards in this country compared to other Western democracies.

Senator Chris Evans: That is a policy debate for the parliament. You put an argument about what your view is; it is not necessarily one I share. I think there are issues now with the burden of FOI in terms of government functioning. But these are obviously debates we can have in the parliament regarding appropriate policy responses. I am not sure it is a matter for estimates.

Senator RHIANNON: I would like to ask about the lobbying code of conduct. Are reports kept of approaches made by unregistered lobbyists?

Ms Leon : Approaches to whom?

Senator RHIANNON: To the Prime Minister or to any ministers. How is that handled?

Senator Chris Evans: But isn't anyone in Australia who is not a lobbyist a non-lobbyist and therefore that would be everybody who ever approached a minister? Definitionally I think we have a problem here.

Senator RHIANNON: Minister, you are probably aware that in-house lobbyists are not covered in any way. I am just trying to see if there are any records at all kept on those people, because it is an unfortunate double standard that we have here.

Ms Leon : I think the issue is that we do not count people as a lobbyist unless they are a lobbyist registered on the register of lobbyists. So it would be difficult to record someone as being in that category if they are not on the register.

Senator RHIANNON: Could you explain why it is difficult? If an in-house lobbyist from any company rings up and wants to have a meeting, how is that different from a lobbyist who has been hired by a company? Let us take BHP Billiton. They have in-house lobbyists. They might choose to also use a lobbying company. What is the difference between a representative of the in-house grouping or a representative of the external hire company? Why would you differentiate in the records that you keep?

Senator Chris Evans: Senator, what is an in-house lobbyist? If the chair of Universities Australia. Mr Glyn Davis, comes to see me, is he an in-house lobbyist or is he chairman of the organisation?

Senator RHIANNON: I am not actually answering the questions. I recognising that there is a complexity here but there is certainly double standards in terms of how the lobbying rules are applied. All my question was addressing was the information you collate on who the Prime Minister and ministers meet with.

Senator Chris Evans: One aspect is a policy debate; the other is a question of fact, which the officer can answer. I think the answer would be that we do not collect information on non-lobbyists, whoever they are.

Senator RHIANNON: So anybody who is an in-house lobbyist you do not actually call them lobbyist?

Senator FAULKNER: A third-party lobbyist.

Senator RHIANNON: Thank you for that, Senator Faulkner. My question is—and you may have actually helped—whether there is any information collected on the descriptor that Senator Faulkner has just used?

Ms Leon : Third-party lobbyists are the people we deal with. They are people who are lobbying on behalf of somebody else.

Senator RHIANNON: Sorry, I thought he was using it in another sense.

Senator FAULKNER: It is known as a third-party lobbyist code.

Senator RHIANNON: But clearly people come in here and lobby in exactly the same way as hired lobbyists lobby. So you are saying that no information at all is collected on them?

Ms Leon : Information is not collected on them as lobbyists. If an organisation were to meet with the Prime Minister about a matter of interest to that organisation, the minister may seek a meeting brief from the department for that meeting. So, in that sense, we would know about the meeting but we would not treat that as an instance of lobbying, because members of the public and members of organisations meet with ministers all the time about issues that are of relevance to their interests and their stakeholders.

Senator RHIANNON: So, in terms of those types of meetings, there are no public records kept?

Ms Leon : No.

Senator FAULKNER: Within the code, Senator, the critical thing is that the lobbyist is defined in the code. It does not mean the definition is not open to debate and so forth, but clause 3 of the code defines a lobbyist in the purposes of the code.

Senator RHIANNON: In the administration of the lobbying code of conduct, are reports kept—

Senator FAULKNER: I am interjecting; I am not answering questions. I am trying to help.

Senator RHIANNON: We wish you were.

Senator Chris Evans: He is engaging as a proud parent.

Senator RHIANNON: Are reports kept of approaches made by unregistered lobbyists and their subsequent referrals to the registration process?

Ms Leon : A lobbyist is defined for the purposes of the code as:

… any person, company or organisation who conducts lobbying activities on behalf of a third party client…

So if by unregistered lobbyists you mean a category of people who are not covered by that definition then, no, we do not keep a category of records about lobbying conducted by people other than third-party lobbyists.

CHAIR: Senator Rhiannon, I am going to have to ask you to wind up.

Senator FAULKNER: So if you go to lobbyists.pmc.gov.au—I am showing my great skill here on—

Senator RHIANNON: What evidence has been gathered to show that TheLobbying Code of Conduct is adequate to achieve its aims?

Ms Leon : The Lobbying Code o f Conduct and the register have been the subject of two reports by Senate committees, and so there has been extensive both public and internal consultation about the operation of the code. The most recent of those in July 2010 gave rise to changes that were announced in August this year. There is a process for breaches of the code being reported to the Secretary of the Department of the Prime Minister and Cabinet. To date, there has only been one such breach that has been reported, which gives us some indication that the code is working well. In that instance, the company involved realised that they had been in error about how they were engaging with the code and have updated their procedures accordingly. So I think the fact that breaches have been few and the one breach that has been reported led to a rectification of practices is evidence of the code working well.

Senator RHIANNON: So you see the code as working well?

Ms Leon : I think that the evidence of there being only one failure to comply is a good sign about the effectiveness of the code.

CHAIR: How many questions, Senator Rhiannon?

Senator RHIANNON: Can I just ask my last one?

CHAIR: Senator Rhiannon, it is your final question.

Senator RHIANNON: Have any government representatives been found to have breached section 4 of the code, which deals with government representatives knowingly and intentionally being a party to lobbying activities by an unregistered lobbyist?

Ms Leon : So far as I am aware the only failure to comply with the code is the one which I referred to which did not concern that circumstance.

Senator RHIANNON: Could you take it on notice to see if there have been other breaches, please.

Ms Leon : There has only been one failure to comply with the code that has been reported.

Senator RHIANNON: I thought you just said as far as you knew—that is why I asked.

Ms Leon : No, that is the circumstance to date: only one breach has been reported.

Senator RHIANNON: So it is not as far as you know; that is absolute.

Ms Leon : That is right.

CHAIR: There are no further questions in that output. We are moving to 1.1.5, which is the Commonwealth Heads of Government Meeting as I understand it. Do you want to flag your question, Senator Abetz and we will see whether it is in the right place.

Senator ABETZ: The Australian Men's Shed Association received $3 million in federal funding, and I understand that with that funding they appointed a marketing fundraising and communications manager, one Mr—

CHAIR: If we can just clarify if this is in the right area. We are just seek—

Senator Chris Evans: The funding, Senator, what portfolio was that?

Senator ABETZ: That is what I do not know, but I understand the Prime Minister's office may have been involved because the person that was appointed was the one that was involved in some political controversy during the 2010 election with the—

CHAIR: Before you go on any further, Senator Abetz, we are just seeking some clarification whether it comes within this area of 1.1.4.

Ms Leon : I do not believe it is funded in this portfolio.

CHAIR: The officers do not believe it is funded in this portfolio, so they are unable to help.

Senator ABETZ: I will look elsewhere.

[20:14]

CHAIR: We will move onto 1.1.5 and Senator Rhiannon.

Senator RHIANNON: What steps has the Australian government taken or is the government taking to investigate whether Sri Lankan officials seeking to attend CHOGM may be implicated in war crimes?

Dr McCarthy : I will need to take that question on notice.

Senator RHIANNON: Can the minister detail who has applied for a visa to attend the Commonwealth Heads of Government Meeting in Perth this October as part of the delegation from Sri Lanka?

Dr McCarthy : I do not have that detail with me. I would need to check whether questions on visas are for the Department of Immigration and Citizenship. I can take that on notice.

Senator RHIANNON: Even for this event? I thought that for these types of events there was a role for the department.

Ms Leon : Although I do not have them with me, we would have the details of who has registered to attend. I thought your question was about visas which would be a question for the Department of Immigration and Citizenship. If your question is about the names of delegates who have registered to attend then this department would have those. There are over 3,000 delegates and we do not have all of those names with us.

Senator RHIANNON: That was my next question.

Senator CHRIS EVANS: To be helpful, the question of visas is primarily with the Department of Immigration and Citizenship, but there is also a role in certain circumstances for the Minister for Foreign Affairs, in consultation with DIAC, and I am not sure whether PM&C has a particular role in those matters.

Dr McCarthy : Not that I am aware of in respect of visas.

Senator CHRIS EVANS: There are some issues where they engage the foreign affairs department. I do not want to go any further because off the top of my head I cannot recall the circumstances. There are things such as suggestions of war crimes et cetera where there is some formal engagement with foreign affairs under the act.

Senator RHIANNON: I was going to go on to who is coming as part of the Sri Lankan delegation. Please take that question on notice as I believe the names are not before you. I ask specifically whether those people who are travelling with President Rajapaksa have sought certificates from the Australian government confirming immunity from any possible legal proceedings in Australia.

Ms Leon : I will have to take that on notice.

Senator MOORE: Is this exclusive to Sri Lanka or is it a general principle? Is there a concept that it should apply to any people coming to international conferences in Australia? Is it something we look at?

Senator CHRIS EVANS: Yes. I answer with my old hat on, but DIAC has responsibility for monitoring people who appear on lists of various types for concerns about terrorist activity, Interpol, criminal activities and issues such as war crimes. We have had issues with people applying for visas to this country. An assessment is made about their fitness to be granted a visa which is part of the normal day-to-day operations of DIAC. That would apply to people coming to conferences, on private visits or on entertainment visas. Those normal processes apply.

Senator MOORE: So diplomatic immunity does not apply? The reason I am asking this is because I wonder whether the same scrutiny is applied to people who come in a government delegation as is applied to those coming for a holiday or conference.

Dr McCarthy : Those will be questions for the Department of Immigration and Citizenship.

Senator CHRIS EVANS: I ought not to flash outside the off stump, but I do not think there is any immunity per se.

Senator MOORE: I was just thinking about some of all the other countries attending.

Senator RHIANNON: That is fine. It is useful to consider it. I did want to ask about the character test. Before you say, 'That comes under DIAC', I would like to be able to ask the question, because considering that these are prominent government people within their country, I would have thought the department would have had some say in this. My question is: will you apply the character test under section 501 of the Migration Act 1958 and the public interest criteria under the Migration Regulations 1994 to assess visa applications for the delegation from Sri Lanka?

Senator THISTLETHWAITE: Chair, could I interrupt. This is an immigration matter. We have got limited time. Perhaps Senator Rhiannon might be directed to move on from this.

CHAIR: Senator Rhiannon, just continue your question to the minister to respond.

Senator Chris Evans: Senator, in your own question you answered the question. These are powers under the Migration Act, exercised by the minister for immigration and the department of immigration. They are not powers exercised by PM&C.

Senator RHIANNON: So you are saying that PM&C had no say in a matter—and we have had this very interesting case and it was revealed by Dr McCarthy before, although she said she would take it on notice, that we were left with the impression that the department had given advice about the admiral who is now the high commissioner and that there were already allegations about possible war crimes prior to him getting the post into Australia. So surely a delegation coming from Sri Lanka, where people could be in a similar situation, would not be just handled by DIAC.

Senator Chris Evans: I think the answer from the officer, and they might like to correct me if I am wrong, was to the effect that they provide briefings to the Prime Minister. But if you are asking about the application of the character test and the Migration Act, that is carried out by the Department of Immigration and Citizenship and the responsible minister is the minister for immigration. PM&C may well, where there are cases that have come to public attention, provide advice to the minister, and I think that is the advice that was given earlier. Correct me if I am wrong.

Dr McCarthy : You have characterised that correctly, Minister.

Senator RHIANNON: Thank you, Madam Chair.

Senator Chris Evans: These matters are properly pursued at immigration estimates—which I think was today. It is probably on now. You are probably in the wrong room.

CHAIR: It is my understanding that there are no further questions on 1.1.5.

Senator BERNARDI: I had a question about state occasions and official visits, which comes under that section.

Ms Leon : No, 1.1.5 is only Commonwealth heads of government.

CHAIR: Nice try. My understanding is that there is nothing further in 1.1.5. We are dealing with 1.2—official and ceremonial support.

Senator ABETZ: Under Commonwealth heads of government, does that include Her Majesty?

Ms Leon : No, 1.1.5 deals only with the Commonwealth heads of government meeting in Perth. Her Majesty is under 1.2.

Senator Chris Evans: As are her carriages.

CHAIR: We are now moving on to 1.2—official ceremonial support, Prime Minister's official residence. Senator Ryan.

Senator RYAN: Do you have a budget for the works being undertaken at the Lodge, that is a whole of activity budget—so not just the works being undertaken but the ancillary costs?

Ms Leon : Do you mean the works to undertake essential repairs to the Lodge, to manage the refurbishment of the roof and the electrical systems and so on—the works that have been recently the subject of some publicity?

Senator RYAN: Yes.

Ms Leon : They are all being managed by the Department of Finance and Deregulation.

Senator RYAN: Are costs for alternative accommodation under the Department of Finance and Deregulation?

Senator Chris Evans: Senator, it is my understanding that this is for repairs that will occur sometime later next year, so we are not in a position where some of those matters have been determined. The officer will answer any specific questions but I think some of the reporting led people to think that it was imminent. It is planned for the second half of next year, is it?

Ms Leon : In that vicinity.

Senator Chris Evans: Certainly not for a while. I do not think the work has been put out to contract or anything like that yet. I just wanted to put it in context.

Senator RYAN: Are the costs of managing the project, as in the actual physical refurbishment work, something that we should pursue with the department of finance at the relevant time?

Ms Leon : That is correct.

Senator RYAN: What about the costs of relocating the Prime Minister to an alternative residence. Are they Department of the Prime Minister and Cabinet or the Department of Finance and Deregulation?

Ms Leon : They are likely to be the Department of the Prime Minister and Cabinet but, as the minister has flagged, it is too far in the future for us to yet have any indication of the cost of that. It will depend on the length of time that the Prime Minister needs to vacate the Lodge and on what accommodation options are identified.

Senator RYAN: You have not identified the accommodation options yet?

Ms Leon : It is too far away to be identifying what accommodation is available. As yet we do not know the exact time the accommodation will be required.

Senator RYAN: So you have done no scoping work, for a lack of a better way of putting it, on the requirements of the accommodation, potential costs, relocating staff presumably to that accommodation and the security costs associated with it?

Ms Leon : To the extent that security considerations come into it, there has been consideration about the nature of the accommodation that would be required but it is too early to say what the costs will be.

Senator RYAN: Do you have a budget at this point roughly drawn up?

Ms Leon : There has not been any detailed development of costs as yet.

Senator RYAN: For everything associated with this from the physical works to the relocation?

Ms Leon : The physical works are a matter for the department of finance so I cannot comment on the state of the budget that the department of finance is working with other than to say that obviously it has not gone out to tender yet. There is inevitably some uncertainty about total cost until the matter has gone to the market. In relation to the matters that are within the Department of the Prime Minister and Cabinet there is not a detailed costing of those as yet.

Senator KROGER: On that, I understand that it is a matter for PM&C, but has it been determined what the works are? Your points are quite nebulous. Did you actually find out what is being done?

Ms Leon : Those questions would need to be directed to the department of finance which is the owner of the building. They are responsible for determining what works need to be done and for contracting those works to be done.

Senator FAULKNER: Is the Official Establishments Trust now with the Department of Finance and Deregulation?

Ms Leon : The Official Establishments Trust still remains with PM&C, but we are responsible for the management of the buildings, not their ownership. The buildings are owned by the Department of Finance and Deregulation as the landlord and they are managed and occupied by the Department of the Prime Minister and Cabinet in the sense of their day-to-day operation.

Senator FAULKNER: The Official Establishments Trust is still serviced by officers of the Department of the Prime Minister and Cabinet.

Ms Leon : That is correct.

Senator FAULKNER: I think it is useful for you to say that, Ms Leon, so that senators get the full picture of what I understand the administrative orders are.

Ms Leon : That is correct.

Senator RYAN: Finally on this point, do you have a timeline or are you dependent upon the department of finance coming up with the schedule of work required as to when you will make these decisions around budgeting?

Ms Leon : The principle carriage of the project is with the Department of Finance and Deregulation. The exact timeframe will depend upon the approach to the market and what is able to be arranged through the normal procurement processes.

Senator RYAN: By that you are referring to alternative accommodation? I am interested in understanding that there are Finance costs. There are PM&C costs around relocation, alternative accommodation, security and staff relocation. When do you expect to be able to answer questions about those costs?

Ms Leon : The Department of Finance and Deregulation has put out to the market for tender for the works, as I understand, and after that tender closes only then will the Department of Finance and Deregulation be able to settle the timeframe. It will depend upon what offers they get from the market about the staging of it. Then we will be in a position to know what period of vacation of the Lodge will be required.

Senator RYAN: That is at the point that PM&C will be able to deal with costs and come up with budgeting costs. I have some questions about the use of the Lodge and Kirribilli House. How many private or public functions have been held at the Lodge and/or Kirribilli without the Prime Minister present?

Ms Leon : The material I have is since we last dealt with this matter at budget estimates in May. Since that time there have been three official functions held at the Lodge. Those were a dinner in honour of the Prime Minister of New Zealand, the Prime Minister's dinner the evening before COAG—attended by the premiers, chief ministers and the president of the local government association—and an informal occasion for a President of the European Commission.

Senator RYAN: Those three functions presumably had the Prime Minister present.

Ms Leon : I believe so.

Senator RYAN: Have there been any functions held at the Lodge or Kirribilli without the Prime Minister present?

Ms Leon : They are the only official functions that have been held at the Lodge since May 2011.

Senator RYAN: What about non-official functions?

Ms Leon : The department does not keep any information about private functions.

Senator RYAN: So there is nowhere in the department that keeps information about that—even if, for example, there was a security cost involved.

Ms Leon : The normal practice for occupants of the Lodge or Kirribilli House is that if there is a major function held which will involve additional costs then, ordinarily, the occupants of the Lodge or Kirribilli House have in the past contributed for those types of events. But there have not been any private functions of sufficient significance to need to involve those arrangements.

Senator RYAN: Who makes the determination as to significance?

Ms Leon : These matters are some questions of judgment but obviously if you are having a couple of people over for dinner it does not require any additional security costs and so there is no need to ask for additional security to be provided.

Senator RYAN: They are judgments made by the occupants of the Lodge, presumably, rather than by the Department of Prime Minister and Cabinet.

Ms Leon : I think if there was to be any function of significant size there then, necessarily, it would be brought to the attention of the staff of the Lodge or Kirribilli House, who are employees of the Department of Prime Minister and Cabinet.

Senator RYAN: But presumably you do not rely on staff of the Lodge to tell you, 'We think this function is over the line' of what is significant and what is not. You rely on the occupants of the Lodge to volunteer that information, do you not?

Ms Leon : That has been the practice over many years.

Senator RYAN: Do you have any arrangements in place or have you ever had to ask about a function at the Lodge?

Ms Leon : That has not been volunteered, no.

Senator RYAN: The reason I ask is that there was an article in Adelaide Now on 10 July, with Geoff Raines. I will read the few short lines of the article?

GEOFF Raines, former poster boy at Richmond, is a close friend of PM Julia Gillard's bloke Tim Mathieson.

And Raines was happy to tell Triple M about the pleasure of a boy's night in at The Lodge.

"I haven't done Kiribilli, but I've done The Lodge," Raines said.

"Julia was away too ... we had a good weekend.

"He (Mathieson) entertained me well, we looked after The Lodge and we did it in reasonable style."

Mathieson, Shepparton's most famous hairdressing export, is a massive Tigers fan.

I would not have characterised such a thing as a 'boys' night' but given that was in the press I will use that. Are any events like that brought to the department's attention, or do you consider those to be of a private nature?

Ms Leon : If a small number of visitors is present that is a private matter for the occupants of the Lodge or of Kirribilli House who are not ordinarily required to inform the department if they are having a visitor.

Senator RYAN: Are there records kept of who enters and exits the Lodge or Kirribilli House?

Ms Leon : I would have to take that on notice.

Senator RYAN: I have to admit my knowledge of the Lodge and Kirribilli is based more on a recent ABC television show than personal experience.

Senator Chris Evans: I will see if I can get you an invite, Senator.

Senator RYAN: I might get one sooner than you would hope for, Senator Evans.

Senator Chris Evans: It does not work like that. Trust me.

Senator RYAN: Touche. You can take on notice whether or not there are logs kept of who enters and exits the Lodge and Kirribilli?

Ms Leon : I will take that on notice.

Senator KROGER: On that point, surely security has to be advised at the gate when a non-resident is expected at the Lodge or Kirribilli House.

Ms Leon : Quite possibly. I said I will take that on notice.

Senator KROGER: One would presume that there would be a log of visitors, given that security would have to be advised.

Senator CHRIS EVANS: The question went to whether a register is kept et cetera. The officer does not know and I do not know. We will take it on notice. Clearly, one would have to get entry to the Lodge and therefore would have to be authorised. The guard would have to have the name of who to let it, yes. Whether or not that is kept in some sort of register and made available, we do not know.

Ms Leon : Security there is provided by the AFP.

Senator RYAN: As security at the Lodge is provided by the AFP, if the staff of the department do not keep the register, please find out as part of taking that question on notice whether the AFP, which provide security to the Lodge on the department's behalf, keeps a register.

Ms Leon : We may be able to, or it may need to be directed to the Attorney-General's portfolio where the AFP appears.

Senator CHRIS EVANS: We can consult with them before providing an answer on notice.

Senator RYAN: That is exactly what I am seeking. The AFP is acting on your behalf providing security. I think it would be entirely reasonable that you could note whether or not they do rather than coming back and saying the department does not keep a log.

[20:36]

CHAIR: We have finished dealing with the Prime Minister's official residences. As there are no questions relating to support for former Governors-General, we move on to state occasions and official visits.

Senator BERNARDI: I am not sure specifically who to address this question to. This morning I asked about invitations to formal events during the Queen's visit. In particular I was drawn by comments by Professor David Flint who heads the Australians for Constitutional Monarchy which were reported in the papers. He indicated that he had not received an invitation to any official event during Her Majesty's visit. This struck me as surprising given that Professor Flint is a person of significance who also heads up one of the organisations that most supports our existing constitutional arrangements. Was this an oversight or what are the criteria for people being invited to specific events? Is consideration given to the conveners or heads of organisations that are significant to the existing constitutional arrangements and support of the Queen?

Mr Leverett : For an event like the reception hosted by the Prime Minister for the Queen on Friday night, my branch routinely prepares suggested guest lists. Those guest lists have a number of what I would describe as nondiscretionary categories, like all members and senators, and some other smaller categories. These categories are described as discretionary and by that I mean, for an event like this or any other events we do, there are always more worthy people than can be accommodated. Value judgments have to be made and we make such judgments. We then prepare and forward that list to the Prime Minister's office for final decision. The Prime Minister, as the host, has the final say on who attends her events. As is always the case, when that list of discretionary categories goes to the office, some names are added to it and some names are deleted from it. We then get presented with a final list. That is the process not just for this particular event but for any event hosted by the Prime Minister.

Senator ABETZ: So, you are the man with the red pen?

Mr Leverett : Not me, Senator.

Senator BERNARDI: I specifically do not want to embarrass either Professor Flint or others that may have been on the list at one point and been declined or not featured on it at all, but I am interested in this. It strikes me as unusual and significant that neither of the two organisations that are about defending the constitutional monarchy in Australia, both headed by individuals who have quite a high public profile, were included in an official reception for the Queen. That is a comment but I do not know how to pursue it further without embarrassing either of the people or other people who may have been on it and your suggestion that they have been struck off by the Prime Minister's office.

Mr Leverett : I did not say they were on the list.

Senator BERNARDI: I know you didn't.

Mr Leverett : I would not go to the advice that was given to the Prime Minister. That is not for me to disclose to this committee. My comments do not imply anything one way or the other about the individuals other than to say that we prepare a draft and it is finalised within the Prime Minister's office.

Senator BERNARDI: Mr Leverett, I was not assuming anything from your comments. Please do not get me wrong in that respect. I am just concerned for the dignity of the other individuals. Is the final guest list made public for this event?

Mr Leverett : It is not published in any format but there is no secret about it. If it was sought we could make it available in due course.

Senator BERNARDI: I will seek it, and will you be able to make it available tonight, for example?

Mr Leverett : No, not tonight because it is not final yet. There are still names, as I understand, being added and so on. When there is a final list I am sure it can be made available.

Senator BERNARDI: So there is still hope for Professor Flint. He may well be added. He deserves to, I think.

Senator ABETZ: Absolutely.

Senator BERNARDI: Is there any dissent from that around the table; I am not sure. So, it is not finalised.

Mr Leverett : No, not yet.

Senator BERNARDI: When will it be finalised? When will the final invitations go out?

Mr Leverett : The reality of these things is that they are often not finalised until the day they actually happen.

Senator BERNARDI: So, people could still be invited on the day?

Mr Leverett : Potentially, yes.

Senator BERNARDI: How special. Would you be able to provide me with a final list of the attendees and those who have received an invitation?

Mr Leverett : Senator, as I indicated earlier in my answer, the final list is at the PM's discretion, so it is not for me to say to you now that I can give you that list.

Senator Chris Evans: We will take the provision of the final invitation list on notice. This is for the function in Canberra, because there are a range of functions.

Senator BERNARDI: Specifically it was about the one here, but then the question goes to the invitational arrangements for any other events for Her Majesty. Are they at the responsibility of this department and your office within it or are they the responsibility of the state governments?

Mr Leverett : It varies on this occasion. Generally speaking a function is hosted by state office holders, governors or premiers and the guest list is at the discretion of those individuals. That is the case with this visit as well. There is the added complication with the factor in Perth of CHOGM itself and there are guest lists around CHOGM as opposed to the state government. The CHOGM events are not my responsibility, so I cannot speak to the guest lists there.

Senator BERNARDI: Whose are they?

Mr Leverett : The CHOGM task force.

Senator ABETZ: It is one thing we were told not to ask about the Queen's visit.

Senator BERNARDI: We would go back in time. It is quite serious. We did flag that we wanted to ask these questions.

Senator RYAN: We were told that this was the place to ask all the questions about Her Majesty's visit.

Senator BERNARDI: Can we re-open it?

Mr Leverett : All but one issue, this is the place.

Senator Chris Evans: Provided the chair is happy, we will do what we can to assist the committee.

Senator BERNARDI: I have nearly finished. What about in respect of the Governor-General's hosting of a function for the Queen, does that come under your purview as well?

Mr Leverett : That is the responsibility of the Governor-General and the office of Governor-General.

Senator BERNARDI: Thank you for clarifying that for me. I do think there are some things to ask about CHOGM but I think Senator Abetz might have something.

CHAIR: At 9.15 we are going to have a private meeting to assess the remainder of the day. I have been guided by the opposition in terms of the program. We were going to let the agencies know. We will allocate appropriate amounts of time so that we can get through the program.

Senator RYAN: If we have a meeting at 9.15, given we are so tight for time, we will be going the same number of minutes after 11 o'clock. If you are going to take up time with a private meeting—

CHAIR: I have sought your guidance, Senator Ryan.

Senator RYAN: And we have been giving you advice.

CHAIR: The reality is that we have asked for these agencies to be here—

Senator RYAN: Let's move on.

CHAIR: and we need some clarification about the time. Senator Bernardi, if you have finished in this area, we will go to Senator Faulkner.

Senator BERNARDI: For the moment I have.

Senator FAULKNER: I have a very quick question. Have you found the coach?

Mr Leverett : I do not think the coach was ever lost.

Senator ABETZ: Despite your best endeavours!

Mr Leverett : My answer implied that I personally have not seen it. I read the press like other people and I understand that it is in a warehouse at Manly but I have not seen it.

Senator FAULKNER: As you know the Department of Prime Minister and Cabinet provided $245,000 to the gentlemen concerned—Mr Frecklington I think his name is. That is correct isn't it?

Mr Leverett : That is correct.

Senator FAULKNER: But you cannot give me an update about what has happened with the thing?

Mr Leverett : I cannot, no. It was made clear during the Howard government when the money was made available that this was not to purchase or buy into the gift in any way. It was just a financial contribution. The coach itself was not an official gift and was a matter between the palace and Mr Frecklington. That advice has been reaffirmed by both the Rudd government and the Gillard government.

Senator FAULKNER: You say it is a matter between the palace and Mr Frecklington but the press secretary to the Queen said in late September:

The Australian carriage Britannia is not an official coach and has not been commissioned by the royal household. This is a private initiative … undertaken and financed by Mr Frecklington.

I interpolate there that that is not true.

I therefore cannot give you an official response on its future use, as it is entirely a matter for Mr Frecklington.

You might say that it is a matter for the palace and Mr Frecklington but that is not what the palace is saying.

Mr Leverett : I think your quote is exactly what I said. It is a private initiative between the two parties.

Senator FAULKNER: The point is the palace was saying that it is not a matter that they are involved in at all. That is completely different to what you said, with respect.

Mr Leverett : I do not think it is. We will have to disagree.

Senator FAULKNER: Do you want me to quote it again?

The Australian carriage Britannia is not an official coach and has not been commissioned by the royal household. This is a private initiative … undertaken and financed by Mr Frecklington. I therefore cannot give you an official response on its future use, as it is entirely a matter for Mr Frecklington.

Which means that it is not a matter for the palace at all.

Mr Leverett : That is an interpretation. It could be interpreted that they are waiting on Mr Frecklington to contact them to determine the future use.

Senator FAULKNER: That is a very courageous interpretation. Anyway, you still have not sighted it, you do not know whether the $245,000 was well spent or not.

Mr Leverett : We do know a bit about the money. When the cabinet decided to make the money available it was not handed over initially. It was on the basis of Mr Frecklington, who had indicated that he had spent up to $1 million on the coach, presenting invoices and evidence of what he actually spent. He ultimately submitted a whole lot of paperwork which was gone through and much of it was accepted. Some of it was not accepted and the final figure of $245,000 was arrived at on the basis of proven expenditure.

Senator FAULKNER: And no-one from PM&C has seen the coach, is that correct?

Mr Leverett : That is correct.

Senator FAULKNER: As far as you know, however, it is on North Head.

Mr Leverett : That is correct. The coach was seen by members of Prime Minister Howard's office. The relationship with Mr Frecklington—

Senator FAULKNER: Mr Howard has not been the Prime Minister for four years now.

Mr Leverett : I am trying to make the point that the relationship with Mr Frecklington was between the Howard office and Mr Frecklington, not with the department. The only time we had contact with him—

Senator FAULKNER: You cannot say that. The department paid the money.

Mr Leverett : That is correct. I was about to say: the only contact we had was to pay the money.

Senator FAULKNER: That is substantial. It is $245,000 of taxpayers' money.

Mr Leverett : The amount of money is substantial but the contact was minimal.

Senator FAULKNER: I gathered that. Anyway, as far as you know, even though no-one from PM&C has seen the thing, you think it is at North Head.

Mr Leverett : I believe it is, yes.

Senator FAULKNER: Why do you believe that?

Mr Leverett : I have seen press reports and photographs in the newspapers.

Senator FAULKNER: I have always worked on the basis of: don't believe everything you read in the newspaper. But I will leave it at that.

Ms Leon : Madam Chair, prior to the dinner break I said that I would endeavour to come back with further information about the conversations that may have been had between the department and the Ombudsman about resourcing issues. I can now provide some more information if it would be convenient to do that now.

CHAIR: Yes.

Ms Leon : The department and the office of the Ombudsman had a number of discussions in the lead-up to the 2011-12 budget. While I cannot disclose all the details of those because they are part of the budget process and could reveal budget-in-confidence material, I can say that the office of the Commonwealth Ombudsman did provide the department with advice on the pressures that the office was facing in the area of the oversight of immigration detention and in other areas and on the scope for the office to provide offsets for the increased activity in the detention oversight area for which they were seeking funding. There were two discussions between the Ombudsman personally and my predecessor in this role, Acting Deputy Secretary Barry Sterland, about those resource issues which occurred in March and April 2011.

CHAIR: Thank you. Are we now in a position to deal with Senator Bernardi's questions?

Senator BERNARDI: I do not have any specifically in terms of CHOGM, but the point is one of principle. We did ask and then we were told later on that no, it was not right. So if we wanted to continue to explore—

Senator Chris Evans: I think we have sorted that out, Senator, so it is your chance.

CHAIR: You do not want to ask any further questions?

Senator BERNARDI: Not specifically, no.

CHAIR: Are there any further questions in relation to state occasions and official visits?

Senator RYAN: I was told I could ask about the Prime Minister's hotel costs while overseas. I am happy for these questions to be on notice, if I could quickly read them. I would be interested in knowing where the Prime Minister stayed on her overseas trips since the last financial year and the current financial year and whether consideration was given to staying at the ambassador's residence and if not, why not. We can do that on notice.

Mr Leverett : We can take that on notice.

CHAIR: Before we move on to the Australian National Audit Office, it might be timely if we have our break now, with the indulgence of the committee. We are going to have a private meeting now which will be included in our break.

Proceedings suspended from 20 : 53 to 21 : 10