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FINANCE AND PUBLIC ADMINISTRATION LEGISLATION COMMITTEE
27/05/2010
FINANCE AND DEREGULATION PORTFOLIO
Australian Electoral Commission

CHAIR —I welcome representatives of the Australian Electoral Commission. Are there any opening statements?

Mr Killesteyn —There is no opening statement from me.

Senator BARNETT —I thank the AEC, and Mr Paul Pirani in particular, for being here. I have a letter from the AEC dated 21 May 2010 in response to a letter from me on 14 April 2010. It relates to an allegation of a breach of section 326 of the Commonwealth Electoral Act 1918. It relates to the decision by Mr Kevin Harkins not to nominate as a candidate on behalf of the ALP for division of Franklin for the 2007 general election. I am happy to table that letter as well as a copy of the 7.30 Report transcript. That was part of the evidence regarding the letter. I table both documents.

CHAIR —Is it the wish of the committee to have these tabled? There being no objection, it is so ordered. We will get copies of those to the witnesses and the minister.

Senator BARNETT —Thank you very much. Mr Pirani, thank you again for your letter of 21 May. I want to walk through some key parts of that letter with you. The second last paragraph of that letter states:

The current material available to the AEC does not provide sufficient evidence that there was a promise or offer of any property or benefit to Mr Harkins in 2007 that was made with the intention of influencing or affecting his candidature as an endorsed ALP candidate for the Division of Franklin.

You explain the reason for that in the second paragraph very comprehensively, for which I thank you. In particular you note:

The AEC has no power to obtain information in matters involving serious criminal offences. The AEC has no power to interview witnesses or to obtain statements from third parties. The AEC has no power to obtain search warrants or to otherwise compel the production of information and documents.

At the end of page 1 you say:

The DPP advice received by the AEC—

which you sought—

does not support the taking of any further action on this matter, particularly given the limited scope of the available evidence.

Firstly, do you have a copy of the DPP advice with you? Are we able to have a copy, if at all possible? I understand if it is not possible.

Mr Pirani —No, I did not bring a copy of the legal advice with me. I have extracted some of the material from that advice that was obtained. Can I just take that on notice. I would like to contact the author of that advice in the DPP before agreeing whether it should be tabled. At this stage we would regard it as covered by legal professional privilege. However, I do note that I have extracted a lot of the material that is in the letter to you from that advice.

Senator BARNETT —Sure. thanks very much. And you can concur with the outline of the evidence I have read into the Hansard and before you today?

Mr Pirani —That is correct.

Senator BARNETT —You have said in the fourth paragraph of that letter:

… the scope of the offence in section 326 of the Electoral Act and the “prima facie” evidence contained in the 7.30 Report transcript and the previous media reports.

I have the transcript from The 7.30 Report before me and I have tabled that, as you have just heard. In it there is a quote from Mr Harkins where he says

Once again a number of senior Labor Party people were involved in that meeting and some leaders from the union movement.

He is referring to the meeting with the senior Labor Party people, which he referred to as an agreement. He went on:

And at that meeting, which was with the full understanding of the then Opposition leader Kevin Rudd, there was commitments given about what might happen for me in the future if I agreed to stand aside. … In a nutshell, it was that if I decided to run for a federal position in the future, that there would be no blockers or veto or interference in the preselection process.

Conor Duffy, the interviewer, said:

Are you 100 per cent certain that Kevin Rudd was aware of these negotiations and had in effect signed off on the agreement?

Kevin Harkins said:

Absolutely, 100 per cent, Kevin Rudd was involved in the negotiations, knew it was happening and then after the conclusion of it people checked with him again to make sure he was happy with those commitments and he was agreeable.

Earlier on in that interview report, which was headed, ‘Outspoken Tasmanian union boss Kevin Harkins has vented his anger about being rejected for Senate pre-selection, accusing the Prime Minister of breaking a promise’, he refers to the fact that David Epstein, who was then Chief of Staff to Mr Rudd, was at that meeting. He refers to senior Labor Party members and there is a reference to senior union representatives also at that meeting. You do not have a copy of the minutes of that meeting, do you?

Mr Pirani —No.

Senator BARNETT —If you did have, that might provide further evidence upon which you could then determine whether you could successfully refer this to the Australian Federal Police.

Mr Pirani —The minutes of the meeting may be relevant. I acknowledge that. The difficulty that we had is further down the page in the transcript. It is the letter from Kevin Harkins to Kevin Rudd of 23 March and the quote in relation to that letter. Part of the issue that we have is that, if such a promise was made and was understood by all the parties and persons who were present to have been made, the actual contents of that letter are inconsistent with the understanding of Mr Harkins himself that such a promise of a benefit or property was made in terms of section 326.

Senator BARNETT —Do you have a copy of that letter?

Mr Pirani —No, but it is cited in the transcript.

Senator BARNETT —You do not have a copy?

Mr Pirani —No, I do not.

Senator BARNETT —So you do not have the full copy of that letter in your possession, so therefore you cannot make a full and comprehensive assessment of that decision. This is simply based on advice on The 7.30 Report? Is that what you are referring to?

Mr Pirani —I am quoting from the same transcript of The 7.30 Report that was referred by you to me to examine. That transcript was what was included in my request for advice to the Director of Public Prosecutions.

Senator BARNETT —Are you aware of the statement reported in the Mercury on 15 April 2010 where Mr Harkins said, ‘The negotiated position was a commitment that if I was to run—

CHAIR —Excuse me, Senator Barnett; are you going to table that?

Senator BARNETT —I am more than happy to.

CHAIR —Can we have a look at it so the committee can consider whether or not we wish to have it tabled? I think it is by principle when people are quoting from media—

Senator BARNETT —All right. Let’s get a copy of that and I will come back to that quote.

CHAIR —Thank you. Is it the wish of the committee to have the document tabled? It is so ordered.

Senator BARNETT —Thanks so much, Chair. I do appreciate that. Mr Pirani, in the third paragraph of your letter you also confirm that Mr Harkins had previously refused an interview with the Australian Federal Police at and around the time of the end of 2007 and early 2008.

Mr Pirani —That was the advice that I received in writing from the AFP at that time, yes.

Senator BARNETT —And obviously Mr Harkins’s disposition appears different today than it was at and around the end of 2007 and early 2008 in terms of making his views known on The 7.30 Report and in media reports more recently.

Senator CAMERON —Chair, I raise a point of order. Mr Pirani cannot give us his opinion about what someone else is thinking. It just is not proper.

CHAIR —On the point of order, I am sure that the officers at the table will be able to respond appropriately on whether or not they can answer that question.

Senator BARNETT —Mr Pirani, are you able to provide a response to that?

Mr Pirani —I have no information before me that would enable me to say that there has been any change in relation to Mr Harkins’s desires to be interviewed by the AFP. The reason I cannot say whether there has been any change is that I have not been instructing the AFP or seeking the assistance of the AFP to interview him.

Senator BARNETT —Fair enough. That is entirely understandable and I appreciate that feedback. Therefore, I draw your attention to this quote from the Hobart Mercury of 15 April, where in the last paragraph Mr Harkins is quoted as saying:

‘The negotiated position was a commitment that if I was to run for a federal position in the future, whether in the House of Representative or Senate, that I would be able to go through the local preselection process without interference from outside.’

So he is making his view very clear with respect to his position. Correct?

Mr Pirani —No. The position that was in the material that was forwarded to me, which I forwarded on to DPP, was the position that was in The 7.30 Report transcript and that position included the extract from the letter dated 23 March 2010, which referred to the earlier letter of 18 August 2009—neither of which I have—which appeared to indicate a contrary position.

Senator BARNETT —Very good. So you have been advised of two letters which you do not have and you were not able to advise or consider that evidence in your decision?

Mr Pirani —That is correct.

Senator BARNETT —Did you consider this article from the Mercury of 15 April 2010?

Mr Pirani —I cannot recall actually seeing this article, but it certainly was not in the material that I forwarded to the DPP.

Senator BARNETT —No, and I put it to you that there is a good deal of evidence that perhaps was not in your possession that you referred to the AFP, because under the law, the AEC act, you are not entitled to investigate, you are not entitled to obtain information, you have no power to obtain search warrants and so on—so you could only refer to the AFP matters within your possession at the time.

Mr Pirani —We can only refer to either the AFP or the DPP matters in our possession—you are correct.

Senator BARNETT —Obviously you had my letter of 15 April to Mr Molnar, who is the acting Tasmanian division Australian Electoral Commission state manager.

Mr Pirani —Yes, and I also had your previous letter of 2007 and the various media reports that were previously referred to the AEC at that time. The whole of the material that had previously been in our possession that had been previously referred to the AFP was also included in the material that I sent to the Commonwealth Director of Public Prosecutions.

Senator BARNETT —Very good. I know that The 7.30 Report refers to the fact that those present in the alleged meeting that Mr Harkins referred to included senior ALP figures, including ministers in the current government, and he also referred to senior union officials. Were you aware that at the time, 2006 and 2007, the current Labor Party federal member for Franklin, Ms Julie Collins, was state secretary of the Tasmanian Labor Party?

Mr Pirani —No.

Senator BARNETT —So there is no reason why, if further evidence could be obtained with respect to the scope of the breach before us—because one of the key issues in your letter is that you are concerned about the scope—

Senator CAMERON —Chair, I raise a point of order. I do not know of any breach that is before us. There might be an allegation of a breach but there is no breach before us.

Senator BARNETT —I take your point. Thank you.

CHAIR —Senator Barnett, please be mindful of the terminology.

Senator BARNETT —Absolutely.

Senator CAMERON —George Brandis taught me that one.

Senator BARNETT —That is well noted. It is an allegation at the moment.

CHAIR —It is very good to know we help each other out. Senator Barnett, you have the call.

Senator BARNETT —Mr Pirani, you raise the issue of the scope of section 326(2)—that is well noted in your letter—and whether a candidate is actually considered a candidate under the legislation. There is a three-month period before the election where there is an acceptance that, under the act, they are considered a candidate; but there is some debate, some discussion, as to whether the candidate is considered and deemed a candidate prior to that time, pursuant to the act. Is that correct?

Mr Pirani —That is correct.

Senator BARNETT —So we know that this alleged meeting was held in and around the early part of August 2007, according to—

Senator Ludwig —You were advised.

—I appreciate that. We were advised—

Senator Ludwig —Unless you were there.

Senator BARNETT —I was not there. According to the evidence—

Senator CAMERON —Chair, I raise a point of order.

CHAIR —Senator Barnett and Minister Ludwig, there is a point of order before the chair.

Senator CAMERON —Senator Barnett cannot argue, ‘We know that there was an alleged meeting.’ There is no proof before us of this meeting, and it seems to me that he is grasping at straws. He should be accurate when he is putting positions to witnesses.

Senator BARNETT —Let me rephrase the question.

CHAIR —I will take that point of order. I remind all senators to be mindful of how they are phrasing their questions. Senator Barnett you have the call.

Senator BARNETT —Thank you.

Senator CAMERON —I am watching you.

Senator BARNETT —According to The 7.30 Report transcript, the alleged meeting was held in or around early August 2007? Is that correct?

Mr Pirani —The comment reported by Mr Conor Duffy, on the first page of that transcript, says:

In the face of a strong anti-union campaign from the Coalition, senior Labor figures met in Melbourne in early August 2007 to discuss his candidacy.

That was in the material that I forwarded to the DPP.

Senator BARNETT —So we accept that there is an issue with respect to the scope of the act. You made those points in your letter back to me, and I accept that. That is not conclusive at this time, and I accept that. Do you accept that, if further evidence and further advice could be obtained in support of the allegations made, they could then—

Senator CAMERON —Chair, I raise a point of order. Mr Pirani is not in a position to answer a hypothetical. You may as well ask him if there is—

Senator RONALDSON —You have been asking them all day.

Senator BARNETT —It is not hypothetical.

Senator CAMERON —You know these things?

Senator RONALDSON —It has been a day of—

Senator JACINTA COLLINS —We let Senator Ronaldson get away with them all the time.

CHAIR —Senators, on the point of order, I have been very consistent with members of the committee in asking them not to put hypothetical questions to any witness, because it will not be fruitful. I do not expect that witnesses will choose to respond to a hypothetical. Senator Barnett, you have only just come in to this hearing this afternoon, but it has been an ongoing issue during these estimates, with quite a few senators raising hypothetical questions. So I remind all members of the committee, once again, to be mindful of the language they use in putting questions and propositions to witnesses. Senator Barnett, you have the call.

Senator BARNETT —I certainly do not accept that question as hypothetical but I do appreciate your comments, Chair. Mr Pirani, I ask you that, if further evidence were obtained in support of the allegation, that evidence together with the allegation be forwarded to the Australian Federal Police for their consideration.

Mr Pirani —At this time, if further material were provided to me that supported the allegations and addressed the inconsistency of the apparent material in The 7.30 Report then I would certainly have to give consideration to forwarding that to the AFP to see whether they could assist in an investigation.

Senator BARNETT —Thank you, Mr Pirani. My final question is: is there any reason why one could not forward such information direct to the AFP for their investigation?

Mr Pirani —You are talking about yourself or a member of the public?

Senator BARNETT —Correct.

Mr Pirani —There is no reason that I am aware of. I do know that the AFP become concerned when they get referrals directly to them, but that is a matter for you to deal with with the AFP.

Senator BARNETT —Sure. Can I just alert you to the fact that it is a matter that I am seriously considering and following through.

CHAIR —Is there a question, Senator Barnett?

Senator BARNETT —No, that is the end of my questioning with regard to this matter, and I appreciate the advice and feedback from Mr Pirani.

Senator Ludwig —I hope you look at the seat of Ryan too with as much vigour as you have dedicated here. It would be interesting.

CHAIR —Senator Cameron?

Senator CAMERON —No, I am fine, thanks. There is nothing of any substance there, Minister.

CHAIR —Are there any further questions on the AEC?

Senator RONALDSON —I have lots of questions on the AEC.

CHAIR —Senator Ronaldson, do you want the call?

Senator RONALDSON —Senator Ryan can go.

Senator RYAN —In previous estimates, Mr Killesteyn, we have covered the issue of AEC management and funding of union annual elections. The AEC has an appropriation to fund the entire cost of union elections, doesn’t it?

Mr Killesteyn —That is correct.

Senator RYAN —That appropriation also covers, I think, registered industrial organisations—is that the term? It also covers a small number of employer associations, does it not? Or is it only unions?

Mr Pirani —I can perhaps answer that. The AEC previously conducted industrial elections under the Conciliation and Arbitration Act, and that funding was put into our running cost base. We continued to conduct similar sorts of elections under schedule 1, I think it was, of the Workplace Relations Act, and that has now been replaced with the Fair Work (Registered Organisations) Act 2009. They are for office bearers in relation to organisations that are registered under that act by Fair Work Australia. So, to the extent that it is an industrial election, which is a generic term, and it deals with an election of office bearers under the Fair Work (Registered Organisations) Act 2009, we have funding in our running cost base to deal with those matters.

Senator RYAN —Can you take on notice to provide a list of all the organisations for which the AEC runs annual elections, if necessary including state as well as national branches of trade unions and other associations—the registered groups under Fair Work.

Mr Pirani —Yes. We also do two other categories of elections. There are the ones where we charge a fee for service. They are done in accordance with the power under section 7A of the Commonwealth Electoral Act. And then we also have the protected action ballots, which are done under the Fair Work Act 2009, where we get reimbursement from our colleagues in DEEWR for the funding for the costs of running those elections. So there are three distinct categories of elections that we undertake in what is generally known as the industrial sphere.

Senator RYAN —Referring to the annual elections, is it possible for you to provide a breakdown of costs for each of those annual elections? You can take that on notice.

Mr Pirani —We will take it on notice.

Mr Killesteyn —We can provide an estimate.

Senator RYAN —An estimate for each of those?

Mr Killesteyn —Yes.

Mr Dacey —That would not be a list of every organisation that we can conduct elections for; it would be every organisation that we have conducted elections for.

Senator RYAN —Yes, that is exactly what I was after, thank you. For protected action ballots you get funded from DEEWR. What percentage of the cost of a protected action ballot does the public funding element cover?

Mr Pirani —We have dealt with this issue previously.

Senator RYAN —I have a couple of other questions.

Mr Pirani —It is 100 per cent.

Senator RYAN —It is 100 per cent. I realise there had been a change under the Fair Work thing. I just could not remember off the top of my head. I understand that the cost of protected action ballots has increased. Can you outline what you have budgeted for the cost of protected action ballots.

0Senator Cameron interjecting

0Senator Jacinta Collins interjecting

Senator RYAN —Could you ignore Statler in the corner, please, because Waldorf has left. Please outline to me if you can the cost of protected action ballots in the current financial year and what you expect in the coming financial year if you have estimates going forward.

Mr Dacey —What I can tell you now is that the revenue that the AEC has received for conducting protected action ballots between 1 July 2009 and 30 April 2010 was $944,667.

Senator RYAN —Do you have a budget going forward where you plan what you expect to receive revenue wise for conducting those ballots in the out years?

Mr Dacey —We run them within our normal allocation, but the additional revenue we get from DEEWR covers the additional costs associated with running those protected action ballots.

Senator RYAN —So the $944,000 between 1 July last year and 30 April this year does not represent the total cost of running protected action ballots? That only represents the additional cost that you bear.

Mr Killesteyn —That is the actual cost incurred for running those particular ballots.

Senator RYAN —Sorry, I misunderstood.

Mr Dacey —Because we use the same people to run the annual industrial elections as well. So that is the actual costing that we get reimbursed for.

Senator RYAN —And that includes the staff time?

Mr Dacey —That is correct.

Senator RYAN —I misunderstood your answer—thank you for that.

Mr Killesteyn —It is a cost recovery model.

Senator RYAN —Do you have a reporting system whereby, when you are conducting annual elections, you issue a report on those? Is it literally just a returning officer’s signature on a bit of paper listing numbers of votes? Do you have a report where you talk about the manner in which the election was conducted, events that arose during the election?

Mr Pirani —There is an obligation, and I have forgotten what section it is under the Fair Work (Registered Organisations) Act—I think it is section 195, but it is somewhere in that order—for us to send a report to the General Manager of Fair Work Australia in relation to a number of matters in the conduct of those elections. They can include matters like if there has been any issue with the interpretation of the rules of the organisation under which we conduct the election or if there have been any issues in relation to problems with the ballot. Normally with those the returning officer returns information to the organisation under whose rules we conduct the ballot, but there is provision there for a report that goes to the General Manager of Fair Work Australia. It is a statutory report and a statutory requirement.

Senator RYAN —Can you take on notice and provide copies to the committee of the reports you have issued in the current financial year?

Mr Killesteyn —For each election, or do you want the standard template?

Senator RYAN —I would like the report for each election, if I could.

Mr Killesteyn —We are potentially talking about hundreds.

Senator RYAN —I would be interested. Occasionally some events in these elections reach public consciousness.

Mr Killesteyn —Sure.

Senator RYAN —I am assuming that you could simply email them to the committee secretariat.

Mr Pirani —I will need to go back and we will take this on notice. The issue is that we do not automatically issue reports for all the elections that are done under the registered organisations act, as opposed to what we have to do for the PABs, the protected action ballots, where we have to report on those specifically. So we are talking about slightly different things. There may not be a report for each and every election. They are not necessarily annual; they are for office bearers, so it depends when the union’s cycle or the organisation’s cycle is for the election of office bearers. We are one of the organisations; we are not the only organisation under the act that is able to conduct those elections.

Senator RYAN —I appreciate that. You are quite right. I know some of them have multiple year terms. I would be interested if you could provide me with all the reports about protection action ballots in this financial year and, where you have conducted annual or organisational elections, those reports as well.

Mr Dacey —We will take that on notice.

Mr Killesteyn —There is a fair amount of work here. There is potentially 565.

Senator RYAN —Couldn’t you just—

Mr Killesteyn —It is not a matter of ‘couldn’t we just’. We have to go out and collect all of that information—

Senator RYAN —I am only asking for the reports you have already filed with Fair Work Australia. I am not asking for any additional reports to be collated, just copies of the reports you have already sent to someone else.

Mr Killesteyn —It is still potentially—

Mr Dacey —In relation to protected action ballots, there is a requirement after every election for us to lodge a report, and there have been 565 of those ballots since 2005-06.

Senator JACINTA COLLINS —Might it be easier to ask the Industrial Registrar for that?

Mr Pirani —Sorry, Senator, are we talking about the PABs? We are not talking about the ones under the Fair Work Act, are we? We are only talking about the ones where we have actually lodged a report under the statutory provisions of the Fair Work (Registered Organisations) Act 2009. So if we can ignore—

Senator RYAN —I understand there are two sorts of reports you do. There are the protected action ballot reports, which you are required to do and lodge.

Mr Pirani —That is correct.

Senator RYAN —Then, when you conduct organisational elections, you occasionally prepare a report.

Mr Pirani —That is correct.

Senator RYAN —What I was after was just the copies of the relevant reports from the current financial year that you have already prepared. I am not asking for the preparation of any additional reports, which I would imagine, given there have been 500 in the last five years—

Mr Dacey —Sorry, Senator—I misled you and others. There have been 565 protected action ballots so far this financial year.

Senator RYAN —I would imagine it is not difficult to send us a big email or a CD.

Mr Killesteyn —We will take it on notice and I will have a look at the amount of work that is involved in collecting that. If it is within the resources that I have, bearing in mind that we are also preparing for an election, then we will provide that information.

Senator RYAN —Sure.

Senator JACINTA COLLINS —Can I suggest in that context, you talk to the Industrial Registrar about how easy it is for them to produce it at their end.

Mr Killesteyn —Yes. They may have a database of these things.

Senator RYAN —I just want to make it clear: I am not asking for any additional reports to be put together at all.

Mr Pirani —I understand that.

Senator RYAN —In Victoria I understand the Australian Electoral Commission will be conducting a ballot of the 16,000 members of the Electrical Trades Union regarding its affiliation of disaffiliation from the Australian Labor Party.

Mr Killesteyn —That is correct.

Senator RYAN —Under what terms are you running that election? Is it a fee for service or is it publicly funded?

Mr Killesteyn —That is a fee-for-service election.

Senator RYAN —I am not sure if you would have the details of the costs yet, but could you provide on notice what the cost of that ballot is?

Senator JACINTA COLLINS —Is that commercial-in-confidence?

Mr Killesteyn —I will take that on notice.

Senator RYAN —Senator Collins raises an issue. Is this a commercial-in-confidence issue—the fee for service?

Mr Pirani —We are not the only organisation that is in the market that conducts these types of elections, so again we will take it on notice and we will have a look.

Senator RYAN —Sure. I also understand that you conducted an election for the Australian Licensed Aircraft Engineers Association where you declared one of the candidates, whose name I will not use, ineligible to be a candidate for the position he was running for.

Mr Killesteyn —That is correct.

Senator RYAN —This candidate, I understand, was considering legal action.

Mr Killesteyn —That is correct. The candidate has lodged an application in the Federal Court for inquiry into the matter and the decision of the AEC.

Senator RYAN —Was this a fee-for-service ballot?

Mr Pirani —No, it was an election conducted under the Fair Work (Registered Organisations) Act 2009.

Senator RYAN —They are the ones you get funding from DEEWR for?

Mr Pirani —No, they are ones that were in our running cost base.

Senator RYAN —This is what we discussed earlier as an annual or non-annual organisational election?

Mr Pirani —That is correct.

Senator RYAN —I appreciate that we had discussions before about it being difficult to break down the cost of each of these elections, given they come out of your running base. Is that still the case?

Mr Killesteyn —We can make estimates based on the number of ballots that are counted. We can make estimates on the questions that are asked. I am happy to provide an estimate.

Senator RYAN —Who pays for the legal case if it ends up before a court? Presumably, the AEC will have costs. You would be a respondent to the action, I would imagine.

Mr Killesteyn —That is correct. It will come out of our running costs.

Senator RYAN —At subsequent estimates I might ask about the cost of this particular case. Do you have an estimate—

Senator Ludwig —I look forward to you asking about it at next estimates.

Senator RYAN —I might ask from the other side of the table, Senator Ludwig. I could very well maintain my interest in these matters.

Senator Ludwig —I have not indicated otherwise.

Senator RYAN —Have you budgeted for a cost for this in your forward planning?

Mr Killesteyn —It is extremely difficult to budget precisely for every legal matter that might emerge. That is not under our control. But we do have a budget for legal matters and, at the moment, our budget is being managed quite well.

Senator RYAN —Well done in that case, Mr Killesteyn.

Mr Killesteyn —Thank you, Senator.

Senator JACINTA COLLINS —Do you factor that risk into your fee-for-service business?

Mr Killesteyn —No, we do not—it is cost recovery—but perhaps we should as a commercial organisation.

Senator JACINTA COLLINS —If you are involved in a fee-for-service business which is then going to lead you into court, you should be factoring that cost risk into your pricing.

Mr Killesteyn —Thank you, Senator.

Senator RYAN —I just want to clarify that the question I was asking you to take on notice included the cost of each of those organisational ballots that you conduct.

Senator CAMERON —I have some questions on that point.

Senator RYAN —I am sure you do, Senator Cameron, but I will finish mine first.

CHAIR —Senator Ryan has the call.

Senator RYAN —Are you also able to provide on notice a list of the organisations for whom you conduct these elections, annual or organisational, which come out of your running costs and a cost base for each of those?

Mr Killesteyn —Yes, we can take that on notice.

Senator RYAN —That is all I have on this issue but I have some questions on other issues for the AEC.

CHAIR —Senator Cameron, your question is a follow-up to Senator Ryan’s question?

Senator CAMERON —Yes. Mr Killesteyn, have the ETU entered into a fee-for-service arrangement with you under a commercial contract?

Mr Killesteyn —That is my understanding.

Senator CAMERON —Did you advise the ETU, or would you advise registered organisations, that, if they enter a commercial contract with your organisation, the details of that commercial contract may be subject to scrutiny in the Senate?

Mr Killesteyn —I would have to take on notice as to what discussions were held between the Victorian office, which is managing this particular election, and the ETU.

Senator CAMERON —If you determine to provide information on the ETU contract, would you then provide notification to all other organisations who seek fee-for-services with you in the future that you may have to divulge details of the commercial contract?

Mr Killesteyn —Again, I would have to take that on notice and look at the particular information that we provide to all organisations who approach the AEC. I will advise you on that.

Senator CAMERON —Would requiring details of fee-for-service commercial contracts to be made available here put you at a competitive disadvantage with other organisations?

Mr Killesteyn —You would have to ask the organisations that are seeking our services whether that particular issue would cause them to give second thought to the AEC. There are probably some organisations where they would suggest that that would be an issue for them. Bear in mind, a lot of our fee-for-service elections are relatively minor and small and the issues are not of great moment.

Senator JACINTA COLLINS —But some of them are quite large.

Mr Killesteyn —Indeed, they are.

Senator CAMERON —And some of them may be small but they could be of great moment.

Mr Killesteyn —That is right.

Senator CAMERON ——Not knowing the trade union movement!

Mr Killesteyn —The AEC is already under some competitive disadvantage. We are required for cost recovery reasons to pursue all of our costs. Our costs are generally larger than some of other smaller institutions that are offering these services. We do not have the sort of technology that is often available to other organisations which can bring the cost down. What we offer as a brand, if you like, is the integrity of the AEC.

Senator CAMERON —Do you believe your integrity would be intact if you had to divulge details of commercial contracts?

Mr Killesteyn —No, I do not think so, because our integrity, our brand, is in relation to the conduct of the election. If people go into a contract with us on that basis but they also know the potential for further publicity of the information, then they have made that decision.

Senator CAMERON —But you cannot tell me today whether organisations who enter into commercial contracts have been advised—

Mr Killesteyn —No, I cannot. I will check that.

Senator CAMERON —Okay.

CHAIR —Any further questions on that topic? Senator Ryan.

Senator RYAN —Mr Killesteyn, I understand that the AEC will be sending out text messages targeting people not on the roll to encourage them to enrol to vote. Is that right?

Mr Killesteyn —We have already commenced that. The situation is that our normal, continuous roll update process is to send out reminders to individuals where we have information that they are not enrolled at the address that we have on our electoral roll.

Senator RYAN —Where do you get that information about mobile phone numbers from?

Mr Killesteyn —It is supplied by other agencies. In this particular case, with the trial that we are currently conducting, information comes from Centrelink.

Senator RYAN —In terms of continuous roll update procedures, are you accessing the new electoral roll in New South Wales, following their adoption—

Mr Killesteyn —No.

Senator RYAN —You are not?

Mr Killesteyn —No. Bear in mind that the new electoral roll for New South Wales—I think you are referring to the Smart Roll?

Senator RYAN —Yes.

Mr Killesteyn —That has not yet commenced. The legislation has not yet been proclaimed, and the New South Wales Electoral Commission has not yet started collecting new enrolments on the basis of that legislation.

Senator RYAN —I appreciate you cannot use the information to update the roll—

Mr Killesteyn —That is correct.

Senator RYAN —but I understand it is expected that will take place some time before the next New South Wales election?

Mr Killesteyn —That is really for the New South Wales Electoral Commissioner. We are working with the New South Wales Electoral Commission; they are developing their procedures at the moment. Certainly, it is my understanding that that is their intention.

Senator RYAN —You will have access, presumably, to the New South Wales electoral roll. Would you be planning to use the data on that roll, which is now a separate state roll, to send out text messages or other communications to people on that roll whose data does not match the Australian Electoral Commission’s roll?

Mr Killesteyn —We have not made that decision yet. We already use a range of other databases, such as Centrelink and Australia Post databases and so forth. The New South Wales roll will be another database. We will have to make an assessment as to whether that information provides us with the sort of integrity that we believe we need to be able to use it for follow-up activity. But I would be silly if I did not look at it seriously.

Senator RYAN —Sure. And we do not know yet when Smart Roll, as they call it, is going to come into effect in New South Wales, do we?

Mr Killesteyn —As I said, that is something that is not within my gift, and my understanding of the intention is that it will commence sometime before the March 2011 election.

Senator RYAN —Sure. Thank you. That is all I have, Chair.

CHAIR —Before I go to Senator Ronaldson, I have a question. Do you anticipate that, at the next election, the polling booths will use computers to cross people off the electoral roll rather than using the hard copies, which was my experience in the recent state election in Tasmania?

Mr Killesteyn —Senator, if only—if only. The legislation, the Commonwealth Electoral Act, provides me with absolutely no authority to have electronic certified lists or to conduct electronic mark-offs. I have no discretion at all. All certified lists have to be produced on paper and they have to be marked off in pencil. I would love it if the legislation was changed.

CHAIR —Have you been briefed on or do you have any knowledge of the success or otherwise of the way the election was conducted in Tasmania?

Mr Killesteyn —Indeed. Perhaps, for the information of the committee, it is worth knowing that the election in Tasmania was actually conducted by the Australian Electoral Commission staff on contract to the Tasmanian Electoral Commission. The Tasmanian Electoral Commission do have all of their certified lists on computers; they are distributed to all of the polling stations that are run by my staff. The system works very well. I have seen it also work in Queensland, in particular aspects, particularly those polling stations which are quite busy, such as town halls, and electronic certified lists do work quite well.

Indeed, I should note as well that the Joint Standing Committee on Electoral Matters has made a unanimous recommendation that the act be changed to allow electronic certified lists. The government has indicated its intention to introduce legislation at some stage to bring that about.

CHAIR —That would protect the integrity of the voting stations because obviously, if it is electronic, you would know whether anyone was attempting to vote at another polling booth on the same day. Is that a possibility?

Mr Killesteyn —That requires a bit more technology. I think this is quite feasible. It is probably more an issue of cost rather than technology. That would require some sort of automatic updating of a central database as people’s names are being marked off the roll and that information being communicated again automatically to all of the computers via wireless technology. It is not a technology issue—it is quite feasible; it is more a matter of cost.

CHAIR —So to the best of your knowledge that then was not part of the technology used in the state election in Tasmania?

Mr Killesteyn —No, it is not. The Tasmanian computers are all standalone computers. They are not linked in any way.

Senator RONALDSON —In relation to the matter that Senator Ryan was talking about, I think we agreed in the last Senate estimates, didn’t we, that effectively there is no penalty for failing to enrol and in living memory there has not been a prosecution for failing to enrol? Is that a reasonable overview of where we got to?

Mr Killesteyn —I think we discussed the difficulties of enforcing enrolment. The difficulties associated with bringing a matter before the court and the fact that any matter that is brought before the court could be defeated quite easily by simply completing an enrolment form on the steps of the courthouse, yes.

Senator RONALDSON —So we have a situation where there could be one million Australians missing. That seems to be the figure that is bandied around. I do not know whether it is correct or not, but I suppose it is by definition impossible to define. Minister, have we got to the stage where the carrot approach simply has not worked and it is time to actually put a bit of stick into this by having some appropriate penalties for failing to enrol?

Senator Ludwig —If I understand you correctly, you want to prosecute 1.4 million people for failing to enrol.

Senator RONALDSON —No, that is a totally unreasonable interpretation.

Senator Ludwig —Sorry, that is what it sounded like.

Senator RONALDSON —I said, and I will repeat it if you like—

CHAIR —Senator Ronaldson, could you repeat your question because I had trouble hearing it the first time because of people on my left chatting.

Senator RONALDSON —What I said, Minister, was that the carrot approach has not worked. Is it time to put a bit of stick into this by increasing the penalties for failing to enrol so there is a legitimate threat which does not involve, as Mr Killesteyn quite rightly said and I was going to refer to, being able to get around any prosecution by filling in the form as you walk into the courthouse?

Senator Ludwig —I understand what you said. I am happy to take advice from Mr Killesteyn—

Senator RONALDSON —Will you accept that—

Senator Ludwig —Let me finish. You have asked me a question.

CHAIR —Senator Ronaldson, you did ask the question. The minister was proceeding to answer. Let him conclude his answer and then you can do a follow-up.

Senator RONALDSON —I just want to clarify that the minister is not repeating the initial interpretation of my question.

CHAIR —Senator Ronaldson, you put the question.

Senator Ludwig —You might have to wait to see.

CHAIR —Minister, you have the call to respond to the question.

Senator Ludwig —I was not going to say it again. I will take advice from Mr Killesteyn about how we can encourage people to enrol. One way you are familiar with—and this is in parliament at the moment—is restoring the close of rolls period. That would ensure that when an election is called and writs are issued people can avail themselves of the opportunity of enrolling because they know it is going to happen. They also might be seized of it at that point. They can also update their address.

I understand that the AEC does have a range of activities in place to encourage enrolment. It is an issue we do take seriously. It is time to look at a range of measures to encourage people to engage with online updates as well as remove some of what we would call ‘unjustified barriers’ of entry.

I agree with you in the respect that I have outlined, but I do not agree that necessarily the approach you have suggested would be one that would work. I will take advice from Mr Killesteyn if he thinks it is something he is looking for and would work.

Senator RONALDSON —I am interested that you view the closure of the rolls bill as something relevant to the question I asked you. We could also call it the ‘let’s risk the integrity of the roll bill’, Minister, but we will see what happens with that.

Senator Ludwig —I take it that was a statement.

Senator RONALDSON —Yes.

Senator Ludwig —But seriously, there are areas where we can do better, and close of rolls, which allows people to enrol and change their address, is an important issue. We might disagree on that policy issue, but it is about making sure that we can do all we can to get people on the roll. Mr Killesteyn, please outline some of these actions that you are undertaking and looking at, because it is an important issue and we do have to address it.

Mr Killesteyn —The first point I would note is that you mentioned the $1.4 million estimate, Senator Ronaldson. That is an estimate based on information that we have on of the number of people who are on the roll in comparison to estimates based on Australian Bureau of Statistics data that are updated quarterly. So I think it is a reasonable estimate. It is certainly not a wild estimate.

Senator RONALDSON —I was not reflecting on it.

Mr Killesteyn —No, but I think it is important to understand that it is a significant number of people. The second point I would note is that the roll is actually growing. If you compare the number of electors on the roll from today to the number of electors on the roll for the 2007 election, there are now some 223,000 more electors on the roll than there were on 24 November 2007. That is good news, and it reflects a lot of the hard work that the AEC is doing and the range of activities that the minister alluded to. The issue is that the eligible population of people who should be on a roll is also growing, and it is growing at a faster rate than are the people who are getting on the roll. That is the challenge that we have, and it is clearly the trend that has been there for some time now. In fact, when you look at the evidence, it is quite clear that the disparity between those who are on the roll and those who should be on a roll has been increasing since about the mid-1990s. So the range of activities we conduct is really about, primarily, our continuous roll update program.

To give you a sense of the dimension of that, from the beginning of this year until the middle of this year we will have issued well over three million letters to individuals about whom we have information that indicates they are not on the roll or not on the roll at the address we have. That is the primary activity, and it is an activity that is relatively inexpensive—I think the standard cost of a COU letter is about three or four dollars—but it is an area where which we see needs supplementation, so we do a range of other things. Senator Ryan mentioned the SMS, and that is another way to try to use technology. We have partnerships with other agencies. We have introduced the smart form so you can complete an update of your enrolment details online; the only thing you cannot do is complete the enrolment because the act still requires that a piece of paper with a signature come to the agency before we can legally and formally affect the enrolment. Those activities will continue, and they will increase in size and dimension as we get closer to the election. Indeed, as we get close to the election we will commence with our advertising, which will also generate significant enrolments.

Senator RONALDSON —You see, my point was that we all acknowledge how ridiculous the situation is, we acknowledge that you are spending money to try and get people on the roll and yet we have no actual deterrent against people not doing so. As a nation we would not tolerate one million people driving around without a car licence, and, quite frankly, I would have thought the right to drive is probably of lesser significance than the right to vote. I appreciate that is a comment, but there is no deterrent at the moment that actually reduces the input required of the commission to get people to vote.

Mr Killesteyn —One thing I might mention—and my apologies for perhaps deflecting you from your line of questioning and thinking—is that the Commonwealth Electoral Act is quite unique in that it is one of the few pieces of legislation, in fact I cannot recall any other similar piece of legislation that I have ever had to administer, where the issue that we are talking about, which is enrolment, is both an entitlement for an Australian citizen and an obligation. It has a duality to it. You cannot talk about tax legislation as being an entitlement to pay tax and nor could you talk about Social Security legislation as being an obligation to take unemployment benefits. But what we have here with enrolment is both an entitlement and an obligation. Under that basis, as an administrator I have to both pursue strategies which encourage people to get on the roll and use their entitlement, because that is part of the issue—it is a service that I have to provide—and at the same time use whatever tools I have at my disposal to enforce that enrolment.

Enforcement is not as bleak as you say. We are now starting to pursue a different style of enforcement where some of the letters that we start to send out will be much more strongly worded than perhaps they have been in the past, in effect to remind people of their obligations. We are now looking at some experiments that have been trialled in Victoria which we think are quite useful, where letters that go out to individuals are actually being sent out on the letterhead of the Victorian Director of Public Prosecutions. It is quite clear that even that is showing some dramatically different responses from individuals than simply letters from the AEC. So I think there are things that we can do which are along the lines of enforcement.

CHAIR —I would just like to acknowledge that Senator Faulkner has come to the table, replacing Senator Ludwig. Welcome back.

Senator Faulkner —It is lovely to be here, Chair.

Senator RONALDSON —Mr Pirani, as one of my colleagues said, you are always down at the end of the table on your own. It is the fact that you are a lawyer, I think, but as politicians we know what the feeling is like.

Mr Pirani —I think it is also because I like spreading out.

Senator RONALDSON —Yes, so do I. Can I take you to our discussion last estimates about the member for Dobell, Mr Thomson, and the matters surrounding him. Has the AEC finalised its consideration?

Mr Pirani —No. The matter has been referred, though, to the Director of Public Prosecutions for advice. That was done in early May. A whole range of material was sent there as well. However, I also note the media report in today’s Age, at page 8, by Mark Davis, which indicates that our colleagues at Fair Work Australia have apparently recently made the decision to go from an inquiry to an informal investigation.

Senator RONALDSON —To a formal investigation?

Mr Pirani —That is what it says in the media report, which is all I am relying upon, in today’s Age.

Senator RONALDSON —I am sure that matter will be pursued next week at other estimates hearings. So the brief has been submitted to the—

Mr Pirani —I would not call it a brief because it does not have the formal witness statements and matters like that. What it does have is a whole range of documentation and we have asked the DPP for advice in relation to the material that we have.

Senator RONALDSON —During the last estimates you also stated that determining who in the Health Services Union had the reporting obligation was ‘going to be a major issue in relation to the late returns that have been lodged’. Is that correct?

Mr Pirani —That is what I said at the last estimates hearing.

Senator RONALDSON —Have you determined who it was in the HSU who had the reporting obligation to the AEC?

Mr Pirani —That has been included in the request to the DPP. Included with that were the statement in the House by the member for Dobell and a media release.

Senator RONALDSON —Are you aware—I am just trying to assist in this regard—that the deadline for lodgement of the 2006-07 political expenditure return was 17 November 2007?

Mr Pirani —That is correct.

Senator RONALDSON —Are you also aware that according to documentation supplied by the Health Services Union to the Industrial Registry, and I quote, ‘Craig Thompson resigned the office of National Secretary on 14 December 2007’, which was a month after the final lodgement date time?

Mr Pirani —That declaration from Ms Kathy Jackson was downloaded from the Fair Work Australia site and was included in the request for advice.

Senator RONALDSON —Similarly, are you aware that the registered rules of the Health Services Union lodged with Fair Work Australia state that the National Secretary is responsible for receiving and banking all monies?

Mr Pirani —Yes.

Senator RONALDSON —Responsible for the books, records, properties and money of the union?

Mr Pirani —Yes, I am aware of that.

Senator RONALDSON —And is required to control and conduct the business of the union.

Mr Pirani —Yes, I am aware of that, Senator.

Senator RONALDSON —So that has all been included in the brief to the DPP?

Mr Pirani —In the request for advice to the DPP. That is correct, Senator.

Senator RONALDSON —Thank you.

Senator CAMERON —Have you experienced in the past any employer organisations failing to lodge their accounts in the appropriate time?

Mr Pirani —Sorry, employer—

Senator CAMERON —Have any employer organisations that are registered under the act failed to lodge their accounts?

Mr Pirani —To the extent that they were donors or third parties I would have to take it on notice. Certainly I am aware of the recent media reports relating to a company that did not lodge one within a particular time because they had a change of personnel, but I am not specifically aware of an employer organisation, as opposed to a union, in relation to this. Again, part of the reason for that is that the returns we are talking about in this case potentially involve a union as an associated entity to the Labor Party and its associated entity returns as well as a candidate return. Those are the two issues.

Senator CAMERON —Thanks.

Senator RONALDSON —I turn now to Contract Notice View CN269950 in the sum of $60,000 for government campaign advertising with the supplier being BMF Advertising. The contract period was 15 March to 31 March 2010. Can you detail for the committee, please, precisely the nature and extent of that advertising campaign?

Mr Killesteyn —Sorry, Senator, we will have to take that on notice. We have, by way of general explanation, a number of contracts with advertisers that are helping us with media strategies, if I can put it that way. This is about design of advertising approaches, either in relation to advertising for an issue around enrolment—looking at what we can do to encourage enrolment—or indeed other strategies in relation to election matters.

Senator RONALDSON —Sure. Are there any plans for the amalgamation of divisional offices over the next 12 months?

Mr Killesteyn —My apologies, Senator, could you repeat that?

Senator RONALDSON —Mr Dacey, did you want to add something?

Mr Dacey —No, Senator.

Senator RONALDSON —Are there any plans for the amalgamation of divisional offices over the next 12 months? If there are, which offices?

Mr Killesteyn —I have no plans for amalgamation of divisional offices over the next 12 months.

Senator RONALDSON —Where are we up to with plans to assist Australian defence personnel overseas to ensure that they are enabled and encouraged to vote at the next election?

Mr Killesteyn —Those discussions have been continuing with the Department of Defence. The arrangements that we have in place will see the placement of assistant returning officers who are defence personnel, and they will conduct the ballot on behalf of the AEC in those overseas sites.

Senator RONALDSON —Are you prepared to guarantee that the participation rate for the overseas defence vote will be higher at this election than at the last one?

Mr Killesteyn —I wish I could guarantee participation rates of the target that we set, but that is, I guess, where you rely on the motivation of the individual elector.

Senator RONALDSON —Is it your anticipation it will be higher?

Senator Faulkner —Senator, we certainly hope it would always improve. I know the question was not directed to me, but obviously, like you, I would always encourage maximum participation in the electoral processes, be it with our ADF personnel or, of course, more broadly amongst enrolled electors. Yes, I certainly share that imperative with you. I know the question was not directed to me but that is a bit of a filler during that interregnum we had there.

Senator RONALDSON —I know you were just busting to get in there!

Mr Killesteyn —We will do our best to facilitate the ballot, Senator. I cannot give you any more guarantees than that.

Senator RONALDSON —Can I please turn to the South Australian election. Are you aware, Mr Killesteyn, of a number of newspaper articles headlined: ‘Labor accused of dirty tricks’, the Sydney Morning Herald, 23 March 2010; ‘Tricky tactics fail character test: dodgy how-to-vote cards will hurt Labor’s reputation’, the Australian, 23 March this year; ‘Labor’ preference for dirty tricks sparks campaign reform call’, the Australian Financial review, 23 March this year; ‘Make no mistake, it’s a shameless con’, David Nason in the Australian on 22 March 2010; and ‘Dirty tricks poll worker uncovered’, Adelaide Advertiser 26 March 2010? I am happy to settle those.

Mr Killesteyn —No, I think we are all aware of those particular issues.

Senator RONALDSON —For the sake of brevity, can I summarise the gist of these stories as follows: ALP activists impersonated Family First representatives at polling booths by wearing T-shirts emblazoned with the logo ‘Put your family first’; these same ALP activists distributed how-to-vote cards that put Family First as first choice but misdirected second round preferences to the ALP; these deceptive how-to-vote cards were authorised by Michael Brown, the secretary of the South Australian branch of the ALP; and Mr Brown defended this cheap political confidence trick claiming ‘We’ve’—the Labor Party have—acted in accordance with the Electoral Act’, which is a quote from the Adelaide Advertiser on 25 March; one of the ALP poll workers caught on camera masquerading as a Family First representative was one Nino Lalic, whose day job was that of a ministerial staffer with the Bligh government in Queensland; and, finally, Senator Fielding rightly described this Labor subterfuge and as a vote to ‘steal votes’ from Family First, as reported in Canberra Times on 25 March. I realise that the South Australian election is beyond your formal bailiwick, but did you consult or were you consulted by the Electoral Commission in South Australia about this rort and what did those consultations entail?

Mr Killesteyn —No. That was a matter for the South Australian electoral commissioner. There is no jurisdiction that I have, as you have already said, and there is no reason, I would have thought, for the South Australian Electoral Commission to consult the Australian Electoral Commission about this matter.

Senator RONALDSON —Do you recall the speech you gave on 8 December last year entitled Building Public Trust in the Public Sector?

Mr Killesteyn —Indeed.

Senator RONALDSON —And do you recall quoting from the Honourable Kim Beazley’s second reading speech for the Commonwealth Electoral Legislation Act 1983 that its purpose was to:

… ensure that we have an electoral process which is modern and free from any allegations or even possibilities of corruption or political pressures.

Mr Killesteyn —Indeed.

Senator RONALDSON —As the nation’s pre-eminent public servant on electoral matters, do you think that the deceptive tactics employed by the South Australian branch of the Australian Labor Party at the last election were conducive to public perceptions of corruption-free electoral process?

Mr Killesteyn —I think it is worth noting that—and this is public information; it is in the minister’s statement in the Senate on 13 May—that the government did seek advice from the AEC about the scope of the existing offences contained in the Commonwealth Electoral Act and whether the incidents that occurred in South Australia would have been covered by the scope of the Commonwealth Electoral Act. Our advice to the minister, as reported in the Senate, is that it is our view that it is more likely than not that the two relevant sections—that is, sections 329 and 351 of the Commonwealth Electoral Act—would operate to make the publication of similar material in a federal election campaign unlawful. That remains our advice. In response to that, as was also indicated by the minister, the AEC was asked to develop some legislative proposals that would remove any doubt at all, if there was doubt, about the publication of such how-to-vote cards. That proposed legislation was also tabled in the Senate on 13 May 2010.

Senator RONALDSON —When did the government seek advice in relation to this matter?

Mr Killesteyn —I do not have the precise date but I would guess it was some time before 13 May. I do not know whether Mr Pirani can help.

Mr Pirani —Certainly before 1 April, because I prepared a brief on that.

Senator RONALDSON —Are you aware that 1(c) of that Senate reference reads:

… whether comparable activity would be considered to be legal under the Commonwealth Electoral Act 1918, including the implications flowing from the decisions in Bray v Walsh (1976), Evans v Crichton-Browne (1981), Webster v Deahm (1993) and Re Carroll v Electoral Commission of Queensland (1998);

Mr Killesteyn —Yes, I have the reference in front of me.

Senator RONALDSON —Are you aware that the Australian Labor Party voted against this reference when it was put to the Senate?

Mr Killesteyn —That is not a matter for my commentary.

Senator RONALDSON —And yet you say they approached you about seeking identical information prior to that—is that correct?

Mr Killesteyn —I am simply reporting what was tabled in the Senate. I am not adding to information that is already there.

Senator RONALDSON —The nature and extent of this how-to-vote card bore a striking resemblance to the material that was involved in, I think, the Webster and Deahm case?

Mr Killesteyn —I am not familiar with that. Mr Pirani may have some familiarity.

Mr Pirani —Senator, my recollection of Webster and Deahm is that Justice Gaudron, when she first looked at the material, said she even doubted it was a how-to-vote card. So there was an issue about what the actual material was. But, Senator, you are correct—there is some analogy, because the material in Webster and Deahm was similar in that, as under state law, it contained the name of the party who authorised the material, which also occurred in South Australia in this case. It had the name of the state secretary of the Australian Labor Party, and that was down the bottom, as the authorisation. So, to that extent, the material was similar.

Senator RONALDSON —Yes, very. I will return to that. I had hoped to ask Minister Ludwig this question, so I will need to rephrase it slightly, Minister Faulkner. I put it to you that, in a speech to the AEC colloquium in September last year that both Senator Ludwig and I spoke at, the minister said, and I quote from the speech:

... but we are indeed fortunate in Australia that the underpinnings of our system of representative democracy are sound, and that our democratic processes are deeply entrenched in a national sense of fairness and an egalitarian culture.

Are you happy to accept the bona fides of that quote? Are you prepared to take it at face value that that was the minister’s quote?

Senator Faulkner —Sure; if you say so I am sure you are right.

Senator RONALDSON —Thank you. Do you recall that the 2007 Australian Labor Party platform declared that ‘democracy depends on robust electoral laws that prevent hidden power and influence from distorting the vote.’ Does that ring a bell?

Senator Faulkner —I would need to check—but I am sure that is an acute quote. If you like I will take it on notice for Senator Ludwig to double check for you. If you say what you say it is, I have no reason to disbelieve you.

Senator RONALDSON —On the basis of that particular part of your platform, do you believe the actions of your Labor colleagues in South Australia are consistent with those principles enunciated by federal Labor?

Senator Faulkner —I do not know whether I am in a position necessarily to judge that because I have not looked at this issue closely. In another life when I was Special Minister of State I suspect I would have done so. I would need to familiarise myself with all the circumstances. It might come as a surprise to you that I have not done so. I have heard what you said you have heard, and what the Electoral Commissioner has said in relation to the status of how-to-votes at the Commonwealth level. If you are asking me for some off-the-cuff analysis of it beyond the evidence I have heard, I am not in a strong position to do so. I have not focused on the issue at all. It would be better if I asked Senator Ludwig to have a look at it. If you ask me whether I have a strong view—and I have expressed this in the past—about the importance of the integrity of our electoral system, I do. I believe that is absolutely fundamental. I have been committed to that the whole time I have been in parliament. If you ask me about the general principle, I am happy to comment—voters should not be misled or deceived in the casting of a vote, which is the general thrust of what I understand you are driving at here. If that is the broad point about integrity that you are making then, yes, I accept that principle; I always have. On the specific detail of what you raise with me, I am not in a strong position to be able to give you a detailed response. I simply have not looked at the issue.

Senator RONALDSON —Are you unaware of the circumstances surrounding the South Australian election?

Senator Faulkner —Largely unaware. I have read one or two newspaper clippings and that has been the limit of my involvement or engagement in it. It might come as a surprise to you but I am pretty busy on other issues and I have not focused on it.

17:24:44

Senator RONALDSON —I am sure it will not come as any surprise to you that I had an expectation that the minister would be at the table. I am sure there is a very good reason for Minister Ludwig’s absence.

Senator Faulkner —I am very happy to explain that to you and I am sure he will be back soon.

Senator RONALDSON —I am not reflecting on it, but it is difficult for me to pursue this question.

—Let me explain to you the reason I have come here. As this Senate estimates committee is in session there is a cabinet meeting. Senator Ludwig, as you would appreciate, is the Cabinet Secretary and there is a matter he needs to attend to. I do not think he will be long. I understand that it is unexpected that I would be here. I am probably as shocked as you that I am here, but I do not think he will be very long and I am sure he will be able to assist you. I am happy to provide responses if and where I can. I am certainly happy to ask the officials at the table to provide all responses wherever they can assist you and if there is something I cannot assist you with I would be happy to take it on notice. I do not think Senator Ludwig is going to be absent from the committee for very long.

Senator RONALDSON —On that basis, Madam Chair, I will wait but clearly I want the opportunity to put questions on notice to the minister at the table if Senator Ludwig has not returned by the time we get to the end of questions to the AEC.

Senator Faulkner —To assist you, I am very happy to facilitate that and, if Senator Ludwig is unable to return to the table in short order, I will let him know that that has happened.

CHAIR —Minister, thank you for that explanation. Senator Ronaldson has referred to you a number of times during these estimates so it is good to have you back before us.

Senator Faulkner —I hope it was positive.

CHAIR —Not necessarily.

Senator RONALDSON —That is not true. I invoked the comments of Senator Faulkner on a number of occasions to pursue with some vigour my views.

CHAIR —Senator Ronaldson, if you wish to take a break from your questioning, Senator Cameron has some follow-up questions.

Senator Faulkner —To assist Senator Ronaldson I might ask someone to let me know how long Senator Ludwig is likely to be detained.

CHAIR —Do you want to continue, Senator Ronaldson, or can the call go to Senator Cameron?

Senator RONALDSON —I actually cannot continue because these questions are specifically for Senator Ludwig. One of the people photographed at this deception is from Queensland and works for a Labor minister from Queensland so obviously I want to put those questions to the minister.

CHAIR —Senator Ronaldson, you can take a break and we will go to Senator Cameron and then we will come back to you.

Senator CAMERON —Mr Pirani, you got me interested when you said a company had failed to lodge. I have had a quick trawl around and I have found that British American Tobacco company have failed to lodge consistently over the last few years their political donations.

Mr Pirani —No, the information that I have is that they were late in relation to one of their particular donor returns. My staff were aware of the tardiness and we had sent several letters to the company in relation to their donor returns. We picked that up because the political party to which they gave the donation had reported it in their annual returns and we subsequently did receive the late return from that company.

Senator CAMERON —I should rephrase that—it was not a failure to return but a late lodgement. That is what the HSU are being accused of here. Did British American Tobacco have two failures to lodge on time in 2005 and 2006?

Mr Pirani —I would have to take that on notice.

Senator CAMERON —What about in 2007-08 when they donated $128,860 to the coalition? Were they late in their lodgement in 2007-08 with that $128,860 donation?

Mr Pirani —Again, I would need to take that on notice. These are on our website and the actual dates when they lodged them are a matter of public record, but I will take that on notice.

Senator CAMERON —What about in 2008-09 when a further donation of $140,000 from British American Tobacco company went to the Liberal Party? Was that again a late lodgement?

Mr Pirani —That is the late return that was mentioned in the media and which I had a briefing on. I am specifically aware of that return being lodged late but I am not aware of the previous ones. But again, I will take that on notice.

Senator CAMERON —What did the AEC do about the late lodgements of $140,000 in 2008-09 and $128,000 in 2007-08? What did you do about that?

Mr Pirani —In the one that I am aware of we had written to the company several times and what further action, if any, we will take is a matter that we are discussing.

Senator CAMERON —Did Senator Ronaldson notify the AEC of this failure on behalf of their donors?

Mr Pirani —As I said, the way we picked up the failure was because of the annual return of the political party that received the donation. That is how it was picked up.

Senator CAMERON —But there was no consistency from Senator Ronaldson in relation to late donations—this has not been brought to your attention by the Liberal Party.

Mr Pirani —The way it got brought to our attention in relation to the Health Services Union was in fact the media reports. The investigation commenced when those media reports mentioned that a particular return that we had previously understood to have included moneys from the national office of the Health Services Union did not in fact include those moneys.

Senator CAMERON —So no investigation of British American Tobacco who, as I read it, had consistently late returns or of another late return of $140,000 to the Liberal Party in 2008-09? Did you conduct an investigation as to why this company cannot comply with the act on a consistent basis when there is $140,000 of tobacco money going to the Liberal Party?

Mr Pirani —As I said, I am aware of the last one that was lodged late and we are considering our position in relation to that. At this stage I have to take the previous ones on notice. Also, the late lodgement is a matter of public record, so there is nothing really for us to investigate. The offence under the act, under section 315(1), is the failure to lodge within time and that is a strict liability offence. We are still considering our position in relation to the one late lodged return of which I am presently aware.

Senator ABETZ —I have got a very quick one. In my local paper there was an article headed ‘Stars face fines as voter slouches’. We had footy star, Buddy Franklin, amongst others named. Did the Australian Electoral Commission put this out into ether and the media?

Mr Killesteyn —No, absolutely not.

Senator CAMERON —Can this document being looked at be tabled?

CHAIR —There is a point of order. Senator Abetz, the general practice is that when people are quoting from a document, particularly from newspaper articles—and it has been constant throughout these estimates—they then seek to have those documents tabled.

Senator ABETZ —I do not, unless the commissioner needs it. But I think the commissioner is aware of it and has already indicated that the commission did not put out this information.

CHAIR —The committee is not aware of it so would you be able to table the document for us?

Senator ABETZ —This is interesting: senators require senators to table documents. I thought it was usually the senator seeking to table a document rather than a committee trying to force—

CHAIR —Sorry, we are not trying to force anything. What we are doing is standard practice that has been raised by the opposition continuously through these estimates.

Senator CAMERON —Point of order—

Senator ABETZ —I will even leave it behind for you. It just seemed—

CHAIR —Senator Abetz, could we sight the document so that we can formally do it?

Senator ABETZ —Sight it. There. Good.

Senator CAMERON —We had a master class from Senator Brandis on this and you have just said it was all wrong.

CHAIR —Just a moment, Senator Abetz, before you continue.

Senator CAMERON —Senator Brandis’ master class is wrong. Is that right?

Senator ABETZ —No, it is only if the witness needs it. The witness does not need the document. The witness knows what I am talking about.

CHAIR —Senator Abetz, if you would not mind just waiting please until we formalise this. Is this ‘Stars face fines as voters ...’—is that it?

Senator ABETZ —Very good, very good.

CHAIR —Senator Abetz, your sarcasm is not necessary. This has been an issue through these estimates for the last four days. Does the committee wish to table this document? It is so ordered.

Senator ABETZ —I did not hear anybody wishing it to be tabled.

CHAIR —Senator Abetz, you have the call.

Senator ABETZ —Commissioner, you are aware of the story and you did not put those names out into the public arena.

Mr Killesteyn —Categorically not. I was as concerned as you are when I read the material in the media. I inquired as to whether any of my officers put that in the public stream. The answer is categorically no. I can only speculate on how that happened but it certainly did not come from the Australian Electoral Commission or its staff.

Senator ABETZ —I fully accept that. I suppose what concerned me was that at the end of the article there was a website for the AEC which made me think perchance that the AEC had been involved in it. The fact that you have not reassures me. Thank you very much.

Mr Killesteyn —We have been undertaking media briefings about getting ready for the election. Clearly we have made some point to the media about the fact that there is a significant number of people not on the roll. I think that has been interpreted by the media in a number of ways.

Senator ABETZ —Mr Garrett might be able to head that campaign for you. He had about a decade off the roll, I recall. Thank you for that reassurance.

CHAIR —Senator Abetz, any further questions? If not, can I have for Hansard just acknowledge Minister Ludwig has returned.

Senator RONALDSON —So, Minister, you have made an urgent submission to cabinet and we are going to do something about these penalties for failing to enrol, is that your outcome?

Senator Ludwig —I can confirm that I have been to cabinet.

Senator RONALDSON —We got through some questions here with the consent of your colleague until we got to—we are talking about the South Australian election, Minister.

Senator Ludwig —Are we? How did it go?

Senator JACINTA COLLINS —We think Senator Ronaldson would look better in a T-shirt.

CHAIR —Senator Ronaldson has the call.

Senator Ludwig —I make light. I should apologise, Chair. I should not make light.

Senator RONALDSON —I will so. I am looking a lot better in a T-shirt than I was three weeks ago. A lot better.

CHAIR —I think, Senator Ronaldson, we will reserve our judgment.

Senator Ludwig —I do not know whether I can contain myself on that one.

CHAIR —That is a re-payment for your slight against all Tasmanians a little earlier.

Senator RONALDSON —My family are from Tasmania, Madam Chair. I am a very loyal Tasmanian. Minister, we are referring to the incident surrounding the Family First brochure in South Australia and I had quoted you from your colloquium speech in 2009, which was acknowledged as being accurate. Then I quoted from the 2007 Australian Labor Party platform, which was viewed to be accurate, and I suppose in fairness I should just read out your portion of the speech again:

… we are indeed fortunate in Australia that the underpinnings of our system of representative democracy are sound, and that our democratic processes are deeply entrenched in a national sense of fairness and an egalitarian culture.

In light of the events surrounding the behaviour of the South Australian Labor Party in relation to the Family First brochure, do you think their behaviour and the behaviour of the state secretary is consistent with both the 2007 platform and your speech to the colloquium?

Senator Ludwig —I am not sure that what I think personally is relevant, but these are the facts of the matter. The issue was obviously seized by me. The AEC can correct me where I am wrong about this. The AEC gave me advice that similar activities would more likely than not already be in breach of the Commonwealth act. I was concerned about what would happen if a similar circumstance with any political party were to arise in the federal election, given that it is likely to occur some time into the future but not that far away. The government decided to take action—a belt-and-braces approach is perhaps the best way of putting it—to ensure that these actions would more likely than not be firmer rather than more likely than not be a breach of the Electoral Act. I would hope, quite frankly, that the opposition and others would support the amendment that I then tabled. You had referred the matter to JSCEM, for all the reasons that you and the Greens—and I think minor party and Independent senators; I am not sure—

Senator RONALDSON —And Senator Xenophon and Senator Fielding.

Senator Ludwig —Yes, thank you.

Senator RONALDSON —Yes, all of us.

Senator Ludwig —I was not sure. It is your right to be able to do that. I am more concerned about doing something a little bit earlier, and that is why I foreshadowed that in fact I had been working on an amendment to address this issue. You have chosen, as I can understand it, not to agree to that process and alternatively to refer it to JSCEM. I would have preferred for it to be in place before this election, just to put it beyond a doubt, but that may not now be open to me.

Senator RONALDSON —What was the context of those discussions about the amendment?

Senator Ludwig —The context of the discussions? You might have to explain a little bit more.

Senator RONALDSON —You said it has been knocked back.

Senator Ludwig —Unless you agree? I am happy for you to agree.

Senator RONALDSON —When was this proposal—

Senator Ludwig —You have referred the matter off to JSCEM.

Senator RONALDSON —But when did you discuss this with the opposition?

Senator Ludwig —It was a matter, and I am speaking to the matter that was raised, when you put the matter to the committee. I said—and I am speaking to this motion:

In doing so I recognise that the three signatures to the motion mean that we would not have a majority in the chamber. We would then waste time by going through a procedural motion which the government would lose. The government does not support the reference of these matters ...As such, this inquiry should be undertaken by the South Australian parliament. If not rejected, this would indicate ...

I went on to say:

The AEC advised that these alleged activities would more likely than not be in breach of the act. However, in order to remove all doubt and to ensure that electors are made aware of on whose behalf how-to-vote cards are distributed, I requested the AEC to prepare possible amendments to the act. These amendments, which I table now, improve the authorisation requirements under the act so that it is made clear at the top of the how-to-vote cards whether or not the card is being distributed on behalf of a political party or candidate. I will be seeking support for the amendments when further electoral legislation is debated in June ....

Senator RONALDSON —Minister, would you please withdraw the allegation that this was put to the opposition and was rejected as an appropriate amendment? Will you please withdraw that?

Senator Ludwig —If there is still hope, then I will.

Senator RONALDSON —I want you to withdraw.

Senator Ludwig —I am happy to withdraw it if you are telling me now that there is an opportunity of reaching agreement in relation to this.

Senator RONALDSON —Will you withdraw the allegation that this was put to the opposition and we rejected it? That was a bald-faced lie.

CHAIR —Order, Senator Ronaldson! I have explained the proceedings and the process for estimates hearings a number of times. A question was put to the minister. Senator Ronaldson, whether you like the response or not, it would be helpful if you would allow—

Senator RONALDSON —I am not going to tolerate the minister misleading this committee or making allegations that are not true.

CHAIR —If you would allow me to finish—

Senator RONALDSON —If that is the way this committee is going, I will go and do something else.

CHAIR —If you would allow me to finish, Senator, you put a question to the minister, he was in the process of responding. If you would allow him to respond, then you will have the opportunity to put another question. The minister had the call.

Senator Ludwig —I am happy to withdraw—

Senator RONALDSON —Thank you.

Senator Ludwig —but when you answered in the Senate you said:

We will look at any amendment that the Special Minister of State wants to bring forward to the Commonwealth Electoral Act. From what he has said to me, I do not think this addresses in any way the matter that was the concern of Senator Xenophon, Senator Fielding and me and which led to this reference. Unless my colleagues tell me otherwise in light of these amendments, in my view we should continue to pursue this matter through the Joint Standing Committee on Electoral Matters.

So you can understand why I would have taken the view that you do not support the amendment. It seems clear to me from the transcript that was the import of what you are suggesting. But if you are now saying that there is an opportunity, I am keen—

Senator RONALDSON —I am not saying any more than I said earlier.

CHAIR —Order! Do I have to repeat yet again: the minister is in the process of answering and you will get your opportunity when he completes his answer. Minister, you have the call.

Senator Ludwig —I think I had completed, thank you, Chair.

Senator RONALDSON —Minister, while you were away Mr Killesteyn told us that the government had asked for some advice in relation to the legality or otherwise under the federal legislation. Can you confirm that paragraph 1(c) of the Senate reference, voted for by the Greens, the coalition, Family First and Senator Xenophon, said:

(c) whether comparable activity would be considered to be legal under the Commonwealth Electoral Act … , including the implications flowing from the decisions in Bray v Walsh … , Evans v Crichton-Browne … , Webster v Deahm …, and Re Carol v Electoral Commission of Queensland …

Senator Ludwig —I am sure you know what it is, it is in the reference you signed, which is 1(c).

Senator RONALDSON —That is the very advice that you asked the commissioner, isn’t it?

Senator Ludwig —Not exactly in those words. Can I say that their response was ‘more likely than not’ it would be illegal. Our amendment would make sure, and that is why the reference would be unnecessary. But you proceeded with that in any event, notwithstanding me speaking against your motion, but certainly not against the principle of trying to address this issue to put it beyond doubt.

Senator RONALDSON —So you have asked for an opinion, and the committee has been asked also to do it, but you voted against that reference—is that right?

Senator Ludwig —I have explained why. We do not have to go over that again. It is there on the transcript. Let me be clear about this. My aim was to ensure two things: firstly, that on the advice from the AEC I was comforted because it was more likely than not that it would be illegal, but, secondly, to ask the AEC to put beyond doubt what amendments would be necessary. I then sought to progress that. Unfortunately, you brought the reference on a lot earlier than I had expected, which left me very little room; nor, can I say, did you consult me about the reference, and I might have been able to raise these issues with you at that time. Nonetheless, we are now in this position, and if there is a change in heart from the opposition or the minor parties or Senator Xenophon or Senator Fielding in relation to this amendment, then I am very happy to talk to them about it.

Senator RONALDSON —You have just repeated the same thing. I am not going to dignify that verbally by responding. The amendments in the JSCEM are certainly not mutually exclusive.

Minister, are you acquainted with Nino Lalic from Queensland?

Senator Ludwig —Who?

Senator RONALDSON —Nino Lalic. The gentleman who was photographed with a Family First T-shirt on.

Senator Ludwig —The name from the article rings a bell. I think I can remember the photo. I am aware of him.

Senator RONALDSON —He works for a Labor MP in South Australia. Is that right?

Senator Ludwig —I am aware of him, yes.

Senator RONALDSON —Are you aware that Mr Lalic appears on Mr Swan’s website?

Senator Ludwig —I am not sure I have a clear recollection of that. I will go away and check. I do not think so.

Senator RONALDSON —Are you aware that the Adelaide Advertiser reported that Mr Lalic initially denied wearing a ‘Put your family first’ T-shirt until he was confronted with a photo showing him thus garbed?

Senator Ludwig —I do recall some general media articles that I read; but, ultimately, I think you should pursue that with the South Australian Electoral Commission.

Senator RONALDSON —How do you think that Mr Lalic’s blatant attempt to lie his way out of embarrassment compares with the principle of integrity that Labor 2007 platform proclaimed as a core Labor value?

Senator Ludwig —I reject everything that you have just implied in that statement. It is an odd position for the opposition to adopt. What I have indicated in relation to that matter is that, as soon as I became aware of it—there were reports in the South Australian media—I acted on it. In fact, I have canvassed just recently what I have done about it. This government acts with the highest integrity in these areas, and I was concerned whether or not this matter might arise as an issue—

Senator RONALDSON —Minister, do you believe it is appropriate for Labor apparatchiks from out of state to masquerade as Family First booth workers and hand out deceptive how-to-vote cards to unsuspecting voters?

Senator Ludwig —What I have said is that the issue, as it affects the Commonwealth, the AEC and the conduct of federal elections is a matter for my concern, and I have acted on that very properly.

Senator RONALDSON —I am asking you to compare the behaviour of the South Australian division—

Senator Ludwig —You can ask me a question; I do not know whether you can ask me to do a comparison for you.

Senator RONALDSON —Is the South Australian division bound by the decisions and words of the Australian Labor Party platform?

Senator Ludwig —You can ask me a question relevant to the appropriations and to estimates. I think you are now straying into political commentary.

Senator RONALDSON —Are they or not?

Senator Ludwig —I have indicated again—

Senator RONALDSON —I assume they are.

Senator Ludwig —Firstly, I have addressed the issue in the appropriate way as Special Minister of State. Secondly, if you have got questions which go to party matters, you know quite well that I cannot answer on behalf of the national executive or the party, and you could direct your questions to them if you so chose.

Senator RONALDSON —Do you consider the actions of Mr Michael Brown, who is Secretary of the South Australian Labor Party and orchestrated and authorised this exercise in electoral deception, to be ethical and honourable?

Senator Ludwig —What I have continued to say—and I will say it again just for your benefit, it appears—is that once this matter came to my attention I sought advice from the AEC in relation to it. The AEC gave me advice and I acted upon that advice. I acted upon it to ensure that it would not be a matter that would arise in a federal election this year or whenever it is called. However, it does seem that you have also been apprised of the matter and that it has been referred to JSCEM. I do hope that you will reconsider your position and support the amendment that I circulated in advance at that time—

Senator RONALDSON —Why do you keep on doing this?

Senator Ludwig —It would be, as I said—

Senator RONALDSON —You are just

Senator Ludwig —The advice—

CHAIR —Senator Ronaldson!

Senator Ludwig —The advice that I got—

Senator RONALDSON —That is the worst stunt I think the committee has—

CHAIR —Can I just remind you, Senator Ronaldson—

Senator Ludwig —The advice—

CHAIR —Minister, could you just wait.

Senator RONALDSON —We get an apology, it is withdrawn, and then we get a repetition of it. That is it. If the minister believes that is appropriate behaviour, that is entirely up to him.

CHAIR —Senator Ronaldson, you have asked your question. I cannot direct the minister on how to respond and he is trying to respond, so if you can wait until he responds then you will have the opportunity to put another question.

Senator RONALDSON —I am not going to put—

CHAIR —Minister, you have the call.

Senator Ludwig —Thank you. The advice I have got is that it would be illegal under the Commonwealth legislation, but to put the issue beyond doubt—

Senator RONALDSON —He is showing his true colours, quite frankly, this afternoon—showing his true colours.

Senator Ludwig —we are also seeking to make sure by taking what I have called a belt and braces approach to this matter. The questions you are raising are not for the Commonwealth and not for the AEC; they are matters that you could direct to the South Australian Electoral Commission.

Senator RONALDSON —I just switched off when the minister tried to mislead the committee again, so—

CHAIR —Do you have a question?

Senator Ludwig —I object to that. I am not misleading the committee.

Senator RONALDSON —Do you object to it? Twice you have done it, yet you object to it.

Senator JACINTA COLLINS —On a point of order, Chair: I would ask you—

CHAIR —Order! There is a point of order before the chair.

Senator JACINTA COLLINS —I would ask you to ask Senator Ronaldson to withdraw that unparliamentary remark.

Senator RONALDSON —No, I will not. Do something about it if you want to.

CHAIR —I beg your pardon?

Senator RONALDSON —I said to Senator Collins: ‘Do something about it if you want to.’

CHAIR —I do think—

Senator JACINTA COLLINS —It is not a matter of me doing something about it.

CHAIR —I know it is getting late in the week and it has been a long week for estimates, but I would remind all senators and members of this committee to act in a parliamentary manner. I do not think those sorts of comments are helpful to the estimates process.

Senator RONALDSON —Mr Killesteyn, we have had time to reflect on these how-to-vote cards in light of Webster v Deahm. The material handed out certainly does appear to be similar in nature to that distributed in the Webster v Deahm case, doesn’t it?

Mr Killesteyn —That is what I said.

Senator RONALDSON —Minister, are you aware whether Mr Brown distributed that information in that form—these bogus Family First cards—to fit within the Webster v Deahm ruling?

Senator Ludwig —No, I do not have any personal knowledge. I had media reports at the time which I acted upon. But let us be clear about this. This is an Electoral Commission SA matter. If you have questions about their conduct or what the South Australian electoral commission did about that, it is a matter for their jurisdiction. I feel constrained from commenting on matters which are outside the jurisdiction of the Commonwealth and outside my role as Special Minister of State. They are certainly matters that you could ask the Australian Electoral Commissioner about, if you so desire. You could ask him whether the actions that you have seized upon would be unlawful under the Commonwealth statute.

Senator RONALDSON —Minister, I am just following up a line of questioning pursued earlier by Senator Ryan. In previous portfolio budget statements, PBSs, the individual programs within the various outputs were all disaggregated, weren’t they?

Mr Killesteyn —Yes, that is correct. Sorry, I should not pre-empt the question, but there has been some rationalisation of outcome statements. What has happened with ours is that our three programs—education, the electoral roll and elections—have all been aggregated into one outcome, but within that one outcome it is still split between the three areas.

Senator RONALDSON —In the previous PBS we could see the specific expenditure on industrial elections, couldn’t we?

Mr Killesteyn —I will take that on notice. I am not that familiar with that part of the—

Senator RONALDSON —But you acknowledge that, in the latest PBS, there is no such disaggregation?

Mr Killesteyn —It has been put into a different format so that all three of the primary programs are aggregated under the one outcome. So the same information is there, but it has simply been put under one outcome rather than three outcomes.

CHAIR —That is it. Thank you very much, officers, for appearing before us. We look forward to seeing you at the next estimates. We will now have the Human Services portfolio come forward with outcome one.

Proceedings suspended from 6.00 pm to 6.05 pm HUMAN SERVICES PORTFOLIOHUMAN SERVICES PORTFOLIO

In Attendance

Senator Joe Ludwig, Cabinet Secretary and Special Minister of State

Department of Human Services

Core Department—Outcome 1, Output 1

Mr Finn Pratt, Secretary, Department of Human Services

Mr Jeff Popple, Deputy Secretary, Delivery Policy and Compliance

Ms Kerri Hartland, Deputy Secretary, Service Delivery Reform Implementation

Mr John Wadeson, Deputy Secretary, ICT Infrastructure

Ms Robyn Bicket, Chief Counsel, Legal Services Division

Mr Paul Hupalo, Acting First Assistant Secretary, Social Policy Delivery and Planning Division

Ms Di White, Acting First Assistant Secretary, Strategic Support Division

Ms Jennifer Gale, Chief Financial Officer, Finance and Budget Strategy Division

Mr David Trabinger, First Assistant Secretary, Service Delivery Reform Strategy and Planning Division

Ms Melissa McClusky, First Assistant Secretary, Service Delivery Reform Coordination Division

Mr Patrick Hadley, First Assistant Secretary, ICT Integration and Consolidation Division

Mr Tuan Dao, First Assistant Secretary, ICT Infrastructure and Services Division

Mr Mitchell Levy, Assistant Secretary, ICT Transition and Implementation Branch

Child Support Agency—Outcome 1, Output 2

Ms Philippa Godwin, Deputy Secretary, Child Support Program

Mrs Jennifer Cooke, First Assistant Secretary, Program Management Division

Mr Bill Lodge, Acting Chief Operating Officer, Operations Division

Mr David Mole, Acting First Assistant Secretary, Business Strategy and Projects Division

CRS Australia - Outcome 1, Output 3

Ms Margaret Carmody, General Manager, CRS Australia

Centrelink—Outcome 1, Output 1.1

Ms Carolyn Hogg, Chief Executive Officer, Centrelink

Ms Barbara Bennett, Deputy Chief Executive Officer, Corporate Support

Mr Grant Tidswell, Deputy Chief Executive Officer, Business Development

Ms Sheryl Lewin, Acting Deputy Chief Executive Officer, Customer Service

Mr Trevor Burgess, Chief Financial Officer, CFO and Property Division

Ms Karel Havlat, National Manager, Budget and Management Accounting

Ms Jenny Barbour, Portfolio Manager, Portfolio External Communication Branch

Mr Tony Gargan, Acting General Manager, Forecasting, Information and Performance Division

Mr Brendan Jacomb, Acting General Manager, Corporate Operations Division

Mr Graham Moloney, Acting General Manager, Network Operations Division

Ms Jenny Teece, Acting General Manager, Network Performance Division

Ms Jenny Thomson, Portfolio Manager, Portfolio Emergency Management Branch

Ms Roxanne Ramsey, General Manager, Indigenous and Remote Servicing Division

Ms Catherine Rule, Acting General Manager, Strategy and Relationships Division

Ms Moya Drayton, General Manager, Education, Employment and Support Programs Division

Mr Paul Cowan, General Manager, Seniors, Families and Carers Division

Mr Mark Withnell, General Manager, Business Integrity Division

Ms Vicki Beath, Acting General Manager, Education, Employment and Support Programs Division

Medicare Australia—Outcome 1, Output 1.1

Ms Lynelle Briggs, Chief Executive Officer, Medicare Australia

Ms Malisa Golightly, Deputy Chief Executive Officer, Health

Mr Gary Dunn, Deputy Chief Executive Officer, People and Operations

Ms Carolyn McNally, General Manager, Business Division

Ms Sheila Bird, General Manager, Health eBusiness Division

Mr Colin Bridge, General Manager, Customer Service Design and Compliance Division

Mr Doug Fawns, Branch Manager, Medicare and VAP Programs Branch

Mr Geoff Mutton, Acting General Manager, Network Operations Division

Mr Troy Czabania, Branch Manager, Health Support Programs Branch

Ms Lynne O’Brien, General Manager, CFO Medicare Australia and Portfolio ICT Division

Ms Sue Chapman, General Manager, People Services Division

Ms Michelle Cornish, Acting General Manager, People Capability Division

Mr Mark Jackson, General Manager, Business Framework Division

Ms Pam Spurr, Branch Manager, ICT Business Services Branch

Mr David Hancock, Manager, Aged Care Programs Branch

Australian Hearing

Mr Steven Grundy, Managing Director, Australian Hearing

Ms Gina Mavrias, Executive Manager, Operations

Ms Margaret Dewberry, Executive Manager, Indigenous and Multicultural Services

CHAIR —I welcome Mr Finn Pratt and officers of the Department of Human Services. Under standing order 26, the committee must take all evidence in public session. This includes answers to questions on notice. 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 of 13 May 2009 specifying the process by which a claim of public interest immunity should be raised. The committee has set Friday 9 July 2010 as the date by which answers to questions on notice must be returned. Welcome Mr Pratt, do you have an opening statement?

Mr Pratt —No, thank you.

Senator FIFIELD —Good evening, Mr Pratt. I know what a joy it is to be the last department to appear on a Thursday of an estimates week.

Mr Pratt —We are looking forward to helping you.

Senator FIFIELD —We might start with an easy question. Could you tell us the total number of staff that the Department of Human Services have at the moment?

Mr Pratt —I will kick off and then some colleagues will come to the table to take us through some of the detail. The Department of Human Services proper, including the Child Support Program and the Commonwealth Rehabilitation Service, currently has a head count of 6,718.

Senator FIFIELD —How many of those are SES band staff?

Mr Pratt —SES would be around 50 or 60. It is in that order. I will just see if we have that specific detail. I am advised that it is 46.

Senator FIFIELD —Just by way of comparison, do you have the same figures for DHS in 2007—the number of staff and number of SES?

Mr Pratt —I will just check if someone has that handy. Staffing numbers have been reasonably stable through that time. There have been some ups and downs. We will take that on notice.

Senator FIFIELD —But that would not be hard to get, I am sure.

Mr Pratt —No, that should be quite straightforward to get. I would qualify my response there by indicating that at different times the department has grown substantially as parts of it have been added to—for example, when the Child Support Agency and the Department of Human Services joined.

Senator FIFIELD —Yours is a growing empire.

Mr Pratt —Certainly the portfolio is large.

Senator FIFIELD —Since the last estimates, how many DHS staff have resigned or retired?

Mr Pratt —I will defer to my colleagues here.

Ms Cornish —Senator, are you asking about the Department of Human Services?

Senator FIFIELD —Yes.

Ms Cornish —The number of employees that were separated by a redundancy in the 2010 financial year to 31 March is one person.

Senator FIFIELD —Through redundancy?

Ms Cornish —Voluntary redundancy.

Senator FIFIELD —What about retirements and resignations?

Mr Dunn —I do not think we have the data to that level of specificity. We can take that one on notice.

Senator FIFIELD —Could you also take on notice whether those who have left have been replaced.

Mr Dunn —Yes.

Senator FIFIELD —Would you have the total expenditure on DHS staff travel in 2008-09?

Mr Jacomb —For DHS staff travel—sorry, Senator, what period are you after?

Senator FIFIELD —2008-09.

Mr Jacomb —$2.35 million for DHS.

Senator FIFIELD —You sound like you have got it for the other portfolio agencies.

Mr Jacomb —I have.

Senator FIFIELD —Could I have those figures while you are here.

Mr Jacomb —For 2008-09 Centrelink staff travel was $14.4 million and student travel was $15.4 million.

Senator FIFIELD —Student travel?

Mr Jacomb —That is for Abstudy. We organise them.

Senator FIFIELD —Student travel is a separate figure?

Mr Jacomb —Yes, it is a separate figure. You did ask for staff. The staff figure was $14.4 million for 2008-09; for Medicare—and I apologise for my voice—was $2,137,782 for 2008-09; and for DHS—which I provided previously—was $2.35 million.

Senator FIFIELD —Thank you for that. I will move to the issue of co-location of agency offices.

Senator CAMERON —I have questions on staffing levels but I am happy to wait until you have finished, but it is on that point.

CHAIR —If it is on staffing, go for it, Senator Cameron, and then we will go back to Senator Fifield.

Senator CAMERON —Mr Pratt, you indicated that your total number was 6,817.

Mr Pratt —6,718.

Senator CAMERON —How many retirements do you have each year? Is there a figure?

Mr Pratt —We were trying to answer that question for Senator Fifield a few minutes ago. We do not have that detail with us, but it is not particularly high. From memory, our turnover each year is probably in the order of 10 to 12 per cent.

Senator CAMERON —Ten to 12 per cent.

Mr Pratt —Somewhere in that order.

Senator CAMERON —You aware that the coalition has indicated that there will be a two-year staff freeze on public service positions.

Mr Pratt —Yes.

Senator CAMERON —I do not think Centrelink is included in that. Is that your understanding?

Mr Pratt —My understanding of the opposition policy on this is that the staff freeze would apply to non front-line staff. So front-line staff in Centrelink and presumably Medicare would not be subject to that. That is my assessment of what the statements say.

Senator CAMERON —How do you define ‘front-line staff’?

Mr Pratt —I certainly would not like to speculate about opposition policy.

Senator CAMERON —I am asking you how you define front-line staff.

Mr Pratt —I define front-line staff as those people who deal directly with our customers either through our offices or through our phone centres.

Senator CAMERON —Have you any idea what percentage that would account for out of the 6,718 staff?

Mr Pratt —Yes. Across the various agencies in the human services portfolio it varies from about 60 to 70 per cent of our staff who are front-line staff.

Senator CAMERON —What sort of percentage would that account for out of these 6,718 staff?

Mr Pratt —Across the various agencies in the Human Services portfolio about 60 per cent to 70 per cent of our staff are front-line staff.

Senator CAMERON —There are still about 1,800 or 1,900 non-front-line staff, roughly?

Mr Pratt —In the Department of Human Services, roughly, it would be in that order.

Senator CAMERON —Yes, roughly—that is my quick mathematics. Don’t hold me to that. If you have 10 per cent to 12 per cent turnover, you would have about 180 a year turnover?

Mr Pratt —Correct, although, the rates of turnover probably vary between front-line staff and Canberra based staff. There is probably a higher turnover for Canberra based staff then there are those in labour markets right around Australia.

Senator CAMERON —What would a freeze of 150 staff in your non-front-line staff mean? How would you manage that situation to ensure skills are available to carry out your obligations?

Mr Pratt —We would have to identify priority work and resource that work and stop doing things which are of a lesser priority.

Senator CAMERON —If you did that, would that put more pressure on your backroom staff, for want of a better term?

Mr Pratt —It would reduce, clearly, the capacity of the backroom staff to support the front-line staff.

Senator CAMERON —I was going to come to that. What do you do when you get to a position where your front-line staff cannot carry out their work? As I understand it, you are a cohesive team. Front-line staff cannot work without backroom staff, and backroom staff cannot work without front-line staff; you actually need that integrated approach, don’t you?

Mr Pratt —Backroom staff are pointless if you don’t have front-line staff, and certainly their work is extremely important in ensuring that the front-line staff can do their jobs. But as to where the cut-off is, that is very hard to say. It would vary from function to function and agency to agency.

Senator CAMERON —So a freeze would make it more difficult for you to carry out as effective an operation as you have now?

Mr Pratt —If we reduced the number of supporting staff—people and the back office, we would do less supporting of people on the front-line. If that were government policy, that is what we would have to implement.

Senator CAMERON —And that would have implications for people who are using the services that you provide?

Mr Pratt —Potentially, but I am getting into the area of hypotheticals here.

Senator KROGER —Oh no, not that hypothetical!

CHAIR —Thank you, Senator Kroger, I think we have explored the hypothetical situation countless times during the last 3½ days—with most senators. Please be mindful of the language you are using.

Senator CAMERON —What would be the potential for not employing young graduates, if there were a freeze? Would that be a real potential?

Mr Pratt —If there were a complete freeze on recruitment of back-office people then we would not employ graduates as back-office people.

Senator CAMERON —Okay. Thank You.

Senator FIFIELD —It already sounds as if you are working on your input for the red book and the blue book—that is encouraging.

Mr Pratt —I am neither confirming nor denying that, Senator! I have no idea when the election will be.

Senator FIFIELD —Indeed. It is never too early to start, though, I guess. Mr Pratt, just before I go to co-located agencies, what is the department’s total budget appropriation for 2010-11.

Mr Pratt —I would refer to page 19 of our portfolio budget statement. Our estimated revenue for 2010-11 is $733,954,000.

Senator FIFIELD —It is no small sum. Would you be able to provide the same figure for 2006-07?

Mr Pratt —Yes, but I would have to take that on notice—unless some of our financial people have that? We will take that on notice.

Senator FIFIELD —Thank you for that. I will just go to co-located agencies and Minister Bowen’s announcement that Centrelink, Medicare, CSA and CRS offices would be combined in many cases. What was the target for this year for the number of co-locations you wanted to effect?

Mr Pratt —Minister Bowen announced late last year that we would look to have at least 20 offices co-located during this calendar year.

Senator FIFIELD —Where are we up to?

Mr Pratt —Minister Bowen has recently announced that we plan to co-locate 21 offices by September.

Senator FIFIELD —How many have been completed?

Mr Pratt —A number are in train.

Mr Bridge —Those 21 are commencing as we speak. We have already co-located a number of offices previously, but those 21 are in addition to those, and they will be rolled out over the course of the next few months.

Senator FIFIELD —And those previous co-locations predated the minister’s announcement?

Mr Bridge —Correct.

Senator FIFIELD —So all those 21 will be coming online at about the same time?

Mr Bridge —It will be staggered from late July through to the end of September.

Senator FIFIELD —What is the target for 2011 for co-location?

Mr Pratt —At this stage 21, but the minister also announced—

Senator FIFIELD —That is for 2010?

Mr Pratt —That is for 2010. For the end of 2011, the minister announced that there would be an additional 20 completed. We hope to exceed that.

Senator FIFIELD —What have the costs been to date for co-location work?

Mr Bridge —I cannot give you a total figure in relation to the costs. Each of these offices is very different in its layout and design. In fact, we are using these 21 locations at the moment to work through getting a more common model for how we would go about this co-location program, and we will be able to get a definitive idea of the total cost as we go forward.

Senator FIFIELD —Would you be able to take on notice the provision of a breakdown of the costs to date as far as you are able to?

Mr Bridge —Yes, we can take that on notice.

Senator FIFIELD —Thank you for that.

Mr Bridge —I anticipate that our response will be a little bit preliminary at this stage. We will need to go through the process substantially to give more definitive data.

Senator FIFIELD —Thank you for that. Mr Pratt, it pops into my mind—prompted by Senator Cameron’s questions earlier about front-line staff—that you have been known to get around the front counters with your name badge on, haven’t you?

Mr Pratt —That is correct.

Senator FIFIELD —It can be a bit of a false dichotomy. You are all actively engaged.

Mr Pratt —Indeed. For your information, Senator, I have a service delivery background from many years back.

Senator Ludwig —You are not suggesting that with the freeze you would want the CEO to front the counter?

Senator FIFIELD —I am just thinking aloud. This is not meant as pejorative, Mr Pratt, but we could refer to you as a back office person. There does seem to be a fair bit of latent capability in the back office to do front office work. It just popped into my head.

Mr Pratt —I will take that as a compliment.

Senator FIFIELD —Absolutely. Thank you. With the co-location exercise, has there been the need to prematurely terminate any leases to allow for the co-locations?

Mr Pratt —No. You may recall that at the last estimates we talked about this issue. While not ruling it out as a possibility down the track, we do not think that will be necessary and we certainly have not done that to date.

Senator FIFIELD —You did indicate that you thought it would be unlikely.

Mr Pratt —Yes.

Senator FIFIELD —Is there currently any leased office space which is sitting vacant as a result of co-location?

Mr Pratt —Not as a result of our co-locations to date, and we are not really anticipating that that would occur.

Senator FIFIELD —Is there any leased office space which is sitting vacant not as a result of co-location but for other reasons?

Mr Pratt —Inevitably across the portfolio there would be spots where we would have some vacancies either temporarily, as staff are moving about, or pending refurbishment or pending the move of new functions—that sort of thing. That would be an ongoing aspect of our accommodation and property.

Senator FIFIELD —At the last estimates you indicated that the department had been discussing staffing impacts resulting from co-location with the CPSU. I think there was a working group that was established.

Mr Pratt —That is correct.

Senator FIFIELD —What is the name of the working group?

Mr Pratt —I do not think we—

Senator FIFIELD —You no doubt have dozens of working groups on all sorts of things.

Mr Pratt —We will try to find out exactly what the name of it is. I am sure it is something along the lines of ‘the joint human services CPSU working group on accommodation’ or something catchy like that!

Senator FIFIELD —I am sure the title accurately reflects the level of enjoyment had by all on it. What is the membership of the working group? Again, this might be a self-evident thing—it involves members of the union and members of Human Services—but could you provide—

Mr Pratt —I can provide that as part of the answer.

Mr Bridge —Dealing with co-location there would be representatives from different parts of the total portfolio—Centrelink, Medicare et cetera—and CPSU.

Mr Pratt —Ms Cornish has come to the table and may be able to enlighten us on the name.

Ms Cornish —We have established a workplace relations framework in relation to service delivery reform with the CPSU, and there is a quarterly forum that meets with the CEOs and the secretary of the department. That is called the DHS CPSU service delivery reform executive forum.

Senator FIFIELD —Is is more exciting than we thought!

Ms Cornish —We also have another tier of engagement with the CPSU on the implementation of service delivery reform. That is with deputy CEOs such as Colin Bridge. That is the DHS CPSU joint working party on service delivery reforms.

Senator FIFIELD —If you could provide on notice the membership of each of those two.

Mr Pratt —In fact, we may be able to provide that now.

Ms Cornish —On the executive forum, we have: the Secretary of the Department of Human Services, Finn Pratt; the CEO of Medicare Australia, Lynelle Briggs; the CEO of Centrelink, Carolyn Hogg; Nadine Flood, who is the National Secretary of the CPSU; and Lisa Newman, who is the deputy national president of the CPSU.

On the joint working party on service delivery reform we have Sue Chapman, who is the general manager of people services, and some of her officers, along with the relevant deputies who are working on different elements of service delivery reform. Again, at that forum, there is Lisa Newman from the CPSU, Emma Groube, who is one of the lead organisers, and the three section council secretaries: Kerry Edsall, Jill Hillard and Emma White.

Senator FIFIELD —Are there minutes kept of the meetings of these two bodies?

Mr Pratt —Certainly not for the quarterly get-together. That is a very high-level strategic discussion. As for the working groups, I am not sure. I will take that on notice.

Senator FIFIELD —Could you also take on notice whether those minutes can be provided.

Mr Pratt —Yes.

Senator FIFIELD —I will move to advertising campaigns. In 2008-09, how much did the department spend on advertising or awareness campaigns? I realise that it might not be a straightforward answer depending on how your define ‘awareness’.

Mr Pratt —I can give you a general indication—not much at all. I will just see if we have anything more specific than that. We have not had any campaigns in the Department of Human Services this financial year.

CHAIR —We will now break for dinner.

Proceedings suspended from 6.29 pm to 7.47 pm

CHAIR —I would like to welcome everyone back after the dinner break.

Senator FIFIELD —Mr Pratt, you were about to tell me how much money the department had not spent on advertising, I think.

Mr Pratt —I am hoping that by now we have some people here who can tell us that it is virtually nothing.

Ms Barbour —For the last financial year we had no communication campaigns.

Senator FIFIELD —It sounds like you are hiding your light under a bushel, doesn’t it! So that means there were no information campaigns of any sort and no awareness raising campaigns of any sort—just the usual communication.

Ms Barbour —Just business as usual.

Senator FIFIELD —Okay. Does the department spend money on hospitality—functions for stakeholders or anyone else?

Mr Pratt —Only to a very small degree. I believe we answered a question on notice about this after the previous estimates or recently. I seem to recall that our expenditure on hospitality was in the order of a couple of thousand dollars.

Senator FIFIELD —If you could just take on notice if there is any update on that then that would be good.

Mr Pratt —We will take it on notice to update that.

Senator FIFIELD —Thank you. I have some questions for the Child Support Agency. Can they be asked at this point as well?

Mr Pratt —Yes.

Senator FIFIELD —When you provided figures before—

CHAIR —Sorry, could you just repeat that question to me.

Senator FIFIELD —I was just asking whether it is appropriate to ask questions of the Child Support Agency at this point.

CHAIR —We are actually doing outcome 1, which is general questions. Then we will be going through each program.

Senator FIFIELD —I have no more general questions for the department.

Senator RYAN —I have one general question.

CHAIR —If we can deal with the general questions first and then we will go through the programs.

Senator RYAN —Mr Pratt, earlier in the week the Parliamentary Librarian outlined to us that Centrelink was no longer providing data to the Parliamentary Library.

Senator JACINTA COLLINS —I am not sure that is quite what occurred.

Senator RYAN —Well, it was no longer providing data in the same way that it previously had to the Parliamentary Library.

Senator JACINTA COLLINS —That is a bit more accurate.

Senator RYAN —There were problems with getting data from Centrelink for the Parliamentary Library. I will ask this of Centrelink later, but before you leave I wanted to ask you: has any directive come via the Department of Human Services or from the minister, to your knowledge, with respect to the provision of data from Centrelink to the Parliamentary Library?

Mr Pratt —There are two things to say here. Firstly, it is my pleasure to announce that I will be here for the duration this evening and, secondly, and we will certainly cover this off when Centrelink comes to the table, there has been no direction from either the minister or from the Department of Human Services to Centrelink along those lines.

CHAIR —There are no further general questions, so we will now go to program 1.1, the Central Department and Child Support Program.

Senator FIFIELD —Mr Pratt, when your officers provided figures before for the number of staff in the Department of Human Services, did that include the Child Support Agency?

Mr Pratt —Yes, it did.

Senator FIFIELD —And it also included CRS?

Mr Pratt —That is correct.

Senator FIFIELD —Could that figure, which was provided for the department as a whole, also be broken down for the CSA and the CRS?

Mr Pratt —Yes, I am sure we can do that.

Senator FIFIELD —We will do CSA and we will do CRS later.

Mr Pratt —The figure I gave was 6,718 staff, of whom 2,065 are CRS. The vast majority of the remaining 4,653 are CSP and—

Ms Godwin —We have 3,788—ASL—people who work in the child support program.

Senator FIFIELD —How many SES—

Mr Pratt —They are a subset of that 46 I gave you before.

Senator FIFIELD —Of the 46, what is—

Ms Godwin —I do not have the figure with me and I would be guessing, but it is around 20.

Senator FIFIELD —How many staff were employed by the CSA in 2007?

Ms Godwin —I do not have that figure with me.

Senator FIFIELD —Please take that on notice—and how many were SES band staff. I asked before how many people separated from the Department of Human Services. There was one redundancy and a smaller number, which we do not have, who left in other circumstances. Would those figures be inclusive of the CSA?

Mr Pratt —That is correct.

Senator FIFIELD —Could you also take on notice the breakdown of numbers from the CSA, whether any of those who separated from the CSA were replaced and the travel expenditure for CSA staff in 2008-09?

Mr Pratt —We will take that on notice.

Senator FIFIELD —How many offices does the CSA operate from at the moment?

Ms Godwin —We have 14 so-called core child support locations. As well as that we have 27 regional service centres, which are small customer-facing services that are all co-located with Centrelink services.

Senator FIFIELD —How many of the 14 are earmarked for co-location?

Mr Pratt —That is unknown at this stage. At this stage we are focusing on co-location of Centrelink and Medicare Australia offices, but over the course of the next few years we are hoping that all of our portfolio offices will provide the range of services that are available through their portfolio. At this stage we cannot tell you how we will do that.

Senator FIFIELD —So of those 14 sites, some may be co-located and some may stay where they are but expand the range of—

Mr Pratt —That is possible. It is quite possible that they will continue to provide the services they do now on an ongoing basis. They may provide some other services. They may incorporate people from other parts of the portfolio. All of those things are potentially on the table.

Senator FIFIELD —In total how many child support payers are there at the moment, and can you break it down by men and woman?

Ms Godwin —I can. The total number of paying parents is 766,327 as at the end of April.

Senator FIFIELD —That is a big number.

Ms Godwin —Yes. There are 654,530 male-paying parents, 100,920 female-paying parents and there are 10,877 parents whose gender is not specified in the system because they have provided just their name to us.

Senator FIFIELD —That is interesting. So there is a provision to specify gender but people do not necessarily tick the box?

Ms Godwin —To clarify, those cases include ones going back, if they are in arrears, to the beginning of the scheme. There have been a variety of changes made throughout the scheme’s life; some of them would just be older records.

Senator FIFIELD —How many child support payees—men and women—are there?

Ms Godwin —We probably have that number, but in general terms it is roughly the same. It is about 750,000 receiving parents.

Senator JACINTA COLLINS —Can you give us the break-up by gender, from when you began collecting this data more reliably?

Ms Godwin —That is the break-up; that is the total case load.

Senator JACINTA COLLINS —What is the distribution of new entrants since the time you could more reliably identify gender?

Ms Godwin —I would have to take that on notice.

Senator FIFIELD —How many children is the Child Support Agency paying for?

Ms Godwin —Around 1.2 million children are related to the number of cases we have.

Senator FIFIELD —How much child support, in total, was paid in 2008-09?

Ms Godwin —Total receipts in 2008-09 were $949 billion.

Senator FIFIELD —Sorry?

Ms Godwin —$949 billion. I beg your pardon—$949 million.

Senator FIFIELD —We all took a breath.

Ms Godwin —I know this is a matter of some importance.

Senator FIFIELD —How many payers are in default on their obligations? I know some of these cases would go way back.

Ms Godwin —The total number of paying parents in any amount of arrears is 240,779.

Senator FIFIELD —How is that broken up into recent arrears and those which go back to the year dot?

Ms Godwin —I do not have a complete age breakdown but I can tell you that almost 62,000 of those paying parents with arrears are ended cases. Ended with arrears cases are cases that might have ended this year but the case has ended.

Senator FIFIELD —What are ended cases?

Ms Godwin —Ended cases are our old cases.

Senator FIFIELD —What does ended mean?

Ms Godwin —It means the child has turned 18.

Senator FIFIELD —Do you effectively write those off?

Ms Godwin —No.

Senator FIFIELD —Do you ever write them off?

Ms Godwin —No. That is why each time I have said this I have said it includes ‘ended with arrears’ because regardless of when the case ended that case with the arrears remains what we call active until we can resolve—if we can resolve—the outstanding arrears. Of course there are some of those cases that have been outstanding for many years. I could give you an age breakdown but I just do not have one with me.

Senator FIFIELD —If you could provide that, that would be good. Thank you.

Senator KROGER —With the so called bad debtors, I presume some of them extend beyond the decade that they are in arrears for, if not more than that. To what extent are resources applied to try and retrieve that money for the custodial parent? At some stage are the resources reassessed and you give up trying to get blood out of a stone?

Ms Godwin —We continually reassess the case load to make sure we are applying our effort where it is best applied and where we are most likely to get a collection. If we have persistently tried to collect the arrears and been unsuccessful over a number of attempts and over a period of time, we will mark some cases for non-pursuit. But we continually review the cases that are listed as non-pursuit to see whether we should reactivate them if, for example, new collection opportunities have arisen or we get new information that might suggest that we should now start to pursue the case again. But it is true that if we have persistently tried and not been successful then we will mark a case for non-pursuit. As I say, we review that regularly.

Senator KROGER —What is the volume of net debt outstanding? You said there are just under 250,000 parents in arrears; what is the value of that amount?

Ms Godwin —The total outstanding debt as at the end of April is $1.151 billion.

Senator KROGER —Thank you.

Senator FIFIELD —I guess the CSA doesn’t ever technically write off debts or liabilities; they just become cold cases.

Ms Godwin —There is a variety of things we do. From time to time the receiving parent will agree to discharge the debt, particularly once the case has ended. There are times when we will write off the debt—for example, if the paying parent has died and there is no other collection opportunity available.

Senator FIFIELD —You do not pursue estates?

Ms Godwin —We do, but once the estate is settled and there is no further collection opportunity we would finalise that case. But generally speaking, if we think that there is any likelihood of any collection opportunity, we will continue to pursue it even though the case has ended.

Senator FIFIELD —In 2008-09 what value of liability would have been written off for one reason or another?

Ms Godwin —I do not have that figure with me. I could get it.

Senator FIFIELD —If you could—thank you.

Ms Godwin —Yes. It would be small.

Senator FIFIELD —And also, just out of interest, for 2008-09 what was the value of liability represented by those cases that you deemed not worth while to pursue?

Ms Godwin —Do you mean the ones that we have marked at that point for non-pursuit?

Senator FIFIELD —The cold cases, yes.

Ms Godwin —Yes.

Senator FIFIELD —Thank you. Does the CSA make referrals to family relationship centres at all?

Ms Godwin —Yes, we do. I might ask Ms Cooke to talk about that.

Mrs Cooke —Yes, we do. We make referrals for counselling; we make referrals particularly at the point of registration where we are encouraging people to perhaps go to a family relationship centre and see if they can come to an arrangement as far as contact with their children is concerned. We work quite closely with them. We also refer to the Family Relationship Advice Line, which is a telephone service that is also a referral point for people for a whole range of services.

Senator FIFIELD —Do you keep records of the number and nature of referrals you do?

Mrs Cooke —We do.

Senator FIFIELD —Could they be provided?

Mrs Cooke —Sure.

Senator FIFIELD —Going back to compliance and enforcement, how many staff are specifically and directly employed for the purposes of compliance?

Ms Godwin —I think we provided that information in a question on notice, but I have an update here in one of the charts. The total number employed in noncompliance when we answered the question on notice I think was 487 and it is now 500.

Senator FIFIELD —How many enforcement actions or prosecutions would the CSA have pursued in 2008-09?

Ms Godwin —This year to date we have taken litigation action against 313 customers and we have collected $8.52 million in outstanding payments.

Senator FIFIELD —There have been 313 recourses to court.

Ms Godwin —Yes.

Senator FIFIELD —Out of those 313, how many were successful?

Ms Godwin —That number includes cases where, as a result of us indicating that we were going to take the person to court, they have entered into a payment arrangement.

Senator FIFIELD —We will count that as a success.

Ms Godwin —Indeed. I want to see if I have the table that shows that. As well as that, at the time that we arrive at the court some customers enter into an arrangement, so we do not actually go into the court. Then, of course, there are some that actually go through the court process.

Senator FIFIELD —So on court days your staff have payment facilities available for that eventuality?

Ms Godwin —Or they could agree on a payment arrangement at that time, and we would then not pursue the court action.

Senator KROGER —Footpath mediation, I think it is called.

Ms Godwin —Sorry, I thought we had this here, but we do not. So I will need to take the breakdown on notice, if that is okay with you.

Senator FIFIELD —You do not have hand-held EFTPOS devices available at court proceedings?

Ms Godwin —We do not have hand-held EFTPOS devices, no.

Senator MOORE —It might be a good idea.

Senator FIFIELD —So you will get that information?

Ms Godwin —Yes, we can get that.

Senator FIFIELD —Thank you. Of the parents who are not meeting their obligations, how many are overseas, that fact being the complication?

Ms Godwin —We break the debt down into what we call domestic and international. For the component of the debt which is related to international cases—and I will give a little bit of explanation in a moment—the total is $293.5 million. That is the total associated with international cases. International cases include cases where either the paying or receiving parent is overseas. The amount of debt where the payer is in Australia and we are collecting but transmitting them funds overseas is $126.8 million. Where payers are overseas and we are relying on other countries to collect Australian obligations on our behalf, the figure is $125.7 million. The balancing item in that is a group of cases that are a combination of domestic and international, so some part of the case is overseas and some part is in Australia. So that figure will not add up to the total that I have just given you, but it gives you a bit of a flavour. Where the payer is overseas and therefore the debt collection is undertaken by someone other than us, the figure is $125.7 million.

Senator FIFIELD —I forgot to ask this before. What was the cost of those 313-odd prosecutions?

Ms Godwin —I do not have the figure with me. The actual cost of litigation I would have to take on notice.

Senator FIFIELD —If you could. Does the CSA seek to recoup any of those costs from the party that they have taken to court?

Ms Godwin —If the court orders costs in our favour, yes, we would seek to collect that.

Senator FIFIELD —When getting those figures, could you also obtain the cost of any external legal advice or counsel retained?

Ms Godwin —Sure.

Senator FIFIELD —When the CSA receives a complaint or an allegation, a tip-off about someone or a particular situation, how is that handled? What is the process?

Mr Lodge —When we receive any tip-off, whether it is through the fraud tip-off line, mail or a phone call, we investigate that fully. We have access, as you know, to taxation records and other records that we would check against and check the validity of that investigation. We would interview both parents to test that. If it is found that we require further information, we can do that through requesting records from banks or other financial institutions or employers.

Senator FIFIELD —Who exercises discretion as to whether something is worth following up or not?

Mr Lodge —Ms Godwin spoke earlier about our 500 staff in compliance. It would depend where in compliance that particular piece of work sat at the time. If it was a person that was suspected of fraud, it might end up in the Special Investigation Unit, and those people would pursue that inquiry.

Senator FIFIELD —I guess it is largely through professional experience that staff determine if something is worth examining, worth pursuing, or not.

Mr Lodge —That would be right. They also have access to experienced team leaders in each of their sections who offer them guidance. If we needed to seek legal advice, we would do that also.

Senator FIFIELD —What about—and I guess this might represent a large number of these sorts of tip-offs—a situation where a complaint is lodged that a payer is deliberately minimising their income to reduce their obligations? Would that be a large number of the sorts of complaints received?

Mr Lodge —I think that we would have to have a look at what the allegation was about income minimisation. Some people legitimately have deductions for taxation purposes that we may include back in the assessment of their child support. That is not a fraudulent activity; it is just a different assessment that we have to the ATO.

Senator FIFIELD —Do you have a breakdown of the nature of complaints or tip-offs that you receive? Can you break those down into categories?

Mr Lodge —I do not have them with me, but we could look at getting that information for you.

Senator FIFIELD —If you could. I would be interested in what percentage of the complaints are pursued and what percentage of the complaints made actually result in some form of enforcement action.

Mr Lodge —We will get that information to you if we have it.

Senator FIFIELD —Thank you. I would be interested in whether it is only one per cent of complaints that are made that result in any sort of enforcement action being required—or whatever it is.

Senator KROGER —With the Special Investigation Unit, is there ever determined to be a need for physical surveillance, optical surveillance?

Mr Lodge —In a very small number of cases, we will use optical surveillance. I believe we have provided some figures on this in the past. So far in the optical surveillance area we have completed 35 cases. There are 38 cases in total. Three are still being referred and the optical surveillance has yet to take place on those cases.

Senator KROGER —Do you contract out the services of people to conduct optical surveillance or is that conducted in house by the Special Investigation Unit?

Mr Lodge —No, they are contracted out through a panel of optical surveillance people through the Centrelink contract.

Senator KROGER —So they are detectives and detective agencies—is that what you are saying?

Mr Lodge —I would have to take that on notice and see exactly who makes up that panel.

Senator KROGER —I am just trying to get my head around the process. If the Special Investigation Unit believes that there is reason to further investigate and it requires optical surveillance, who makes that judgment call?

Mr Lodge —The decision to make optical surveillance is done in the compliance area through the Special Investigation Unit. As to the actual delegate who signs the authority, I would have to check on whether it is the national manager for compliance or one of the directors in that area.

Ms Godwin —But I would add that it is taken at a senior level. We only conduct optical surveillance in a very small number of cases where other quite extensive investigations have not necessarily proven to be successful but we think optical surveillance may add to the information which is available to us. That decision, as you can imagine, because it is a small number and it is something we only do when we think it is a serious case, is taken at a senior level. As Mr Lodge says, we can take on notice who the exact delegate is, but it is taken at a senior level.

Senator KROGER —Thirty five or 38—whatever the number is—out of 247,000 odd parents in arrears is not a high proportion, I would suggest.

Ms Godwin —No, it is not at all, and it is because we would only take that sort of serious action if the case itself is serious. Could I add one thing about the number of paying parents in arrears. That does cover a spectrum, including about 12 per cent of those cases where the arrears is less than one month’s liability. There are a whole bunch of people at one end who may have missed one payment and then we have a whole bunch of people way at the other end, where they have significant underpayments that are well established. Obviously you would be more likely to be using optical surveillance at that much more serious end of the spectrum.

Senator KROGER —They might be suffering short-term income stress or a change of circumstances.

Ms Godwin —If people are generally good payers but intermittently have difficulties, that would be something that we would normally deal with through what we call administrative noncompliance. We have early intervention teams who would be talking to them in those circumstances. That is not the sort of case where you would expect to be undertaking an intensive investigation or optical surveillance.

Senator FIFIELD —How many appeals were lodged in 2008-09 against CSA determinations?

Ms Godwin —Do you mean appeals at the Social Security Appeals Tribunal?

Senator FIFIELD —Yes. There is no level of appeal below that.

Ms Godwin —There are a series of administrative processes.

Senator FIFIELD —You could appeal within the CSA, so perhaps you could break it up both ways—those who asked the CSA to review and those who took the next step.

Ms Godwin —I will start at the top and we can go back to the objections. To explain the process, if people have a concern about a decision, they can lodge an objection with us. From memory, I think we deal with about 22,000 objections a year. If they are still not satisfied with the outcome of that objections process they can appeal to the SSAT. So far in 2009-10 there have been 1,484 valid appeals to the SSAT. For the same period in 2008-09 there were 1,654 valid appeals to the SSAT, so there has been a slight reduction in that 10-month period. The total amount for 2008-09 was 2,491 valid appeals.

Senator FIFIELD —Valid appeals. How many appeals were there in total?

Ms Godwin —I do not know if the SSAT has not accepted any appeals, but those are the total numbers of appeals that have gone to the SSAT.

Senator FIFIELD —Sorry, I thought you said ‘valid appeals’.

Ms Godwin —They are called valid because in certain circumstances the SSAT would say they do not have jurisdiction, and I do not know what that number would be.

Senator FIFIELD —Are they appeals that are illegitimately or inappropriately lodged?

Ms Godwin —Yes.

Senator FIFIELD —What is the total number of SSAT appeals and the number of those that were successful?

Ms Godwin —Of the SSAT appeals, some 60 per cent have some component of the decision set aside. The appeal is allowed by the SSAT in part or in full. A significant proportion of the cases that are allowed, however, are allowed on the basis of new information. In other words, it was information not available to the Child Support Agency when it made its decision. We do some analysis of those figures and if you wanted further information we could probably provide it.

Senator FIFIELD —What about the 22,000 internally reviewed cases? How many of those had the decision changed in some way?

Ms Godwin —The report I have here does not have the figures. There are approximately 22,000 objections, and approximately one-third of them are upheld; in other words, the objection is found to be in favour of the customer. I can give you those precise figures on notice.

Senator FIFIELD —How many staff does the CSA directly engage in handling appeals, whether it be through the tribunal or through the organisation itself?

Ms Godwin —I will have to take that on notice. We have a group of people who manage the actual objections. If the case is going to the SSAT, obviously the SSAT processes those. The bulk of our staff would be in the objections area.

Senator FIFIELD —Earlier I asked a question about hospitality spending on DHS. Mr Pratt, you said it might be just a couple of grand. CSA would be lucky if they spent $50.

Mr Pratt —I expect it would be the other way around—the child support program is the largest part of the department. In the year we are talking about, I think most of that several thousand dollars was in relation to payment delivery reform functions undertaken by the central department. I do not think the child support program does a great deal of hospitality.

Ms Godwin —It would not be much. We have stakeholder meetings from time to time, and we would probably provide some small about of catering at those meetings.

Senator FIFIELD —It is not an activity area that would readily lend itself to hospitality, I wouldn’t have thought.

Ms Godwin —We like to give people a cup of tea when they come to a meeting.

Senator FIFIELD —That is just good manners. Senator Ryan’s question earlier about Centrelink and the Parliamentary Library prompts me to ask about the data that is held by the CSA. Have there been any directives from the minister’s office that such information should not be provided to the Parliamentary Library unless the client or the library provides permission for their name to be given and the purposes for which that information will be used? It is not something that was raised by the Parliamentary Library in the earlier estimates but given that it is the same portfolio, I just thought I should put the question.

Mr Pratt —To my knowledge there has never been any direction of that sort given to the department or the Child Support Agency. I am not aware of any information even requested from the Parliamentary Library in recent times. Someone may correct me, but I do not believe it is an issue.

Senator FIFIELD —So to your knowledge the Child Support Agency has not changed the way it provides the information that might be requested by the Parliamentary Library?

Mr Pratt —No. Chair, may I excuse the Child Support Agency?

CHAIR —Yes.

Mr Pratt —I have the question on notice relating to hospitality that we have been discussing. The cost total from 1 June 2009 to 28 February 2010 is $4,339.50, of which $1,500 related to that discussion paper I mentioned and $2,839.50 related to NAIDOC Day celebrations undertaken by the child support offices around the country.

Senator FIFIELD —Thank you for that.

Mr Pratt —I have another update. Before, I quoted 46 SES officers for the department; those figures did not include my fine colleagues from CRS Australia. There are another three of them. So there are 49.

[8.32 pm]