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Senate Legislative and General Purpose Standing Committees Consolidated reports on the consideration of bills January-June 2013 Volume 6-Foreign Affairs, Defence and Trade; Legal and Constitutional Affairs


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Australian Senate

Senate Legislation Committees

Reports on the consideration of bills January-June 2013

Volume 6

Foreign Affairs, Defence and Trade Committee Legal and Constitutional Affairs Committee

© Parliament of the Commonwealth of Australia 2013

ISSN 1834-4062

This document was printed by the Printing Unit, Department of the Senate, Parliament House, Canberra.

TABLE OF CONTENTS

Foreign Affairs, Defence and Trade Committee • International Organisations (Privileges and Immunities) Amendment Bill 2013, dated June 2013 ................................................................... 1

• Veterans' Affairs Legislation Amendment (Military Compensation Review and Other Measures) Bill 2013*, dated June 2013 ..................................... 31

† Volume 5 contains reports of the Foreign Affairs, Defence and Trade Committee

Legal and Constitutional Affairs Committee† • Courts and Tribunals Legislation Amendment (Administration) Bill 2012*, dated February 2013 ............................................................................. 77

• Crimes Legislation Amendment (Law Enforcement Integrity, Vulnerable Witness Protection and Other Measures) Bill 2013*, dated June 2013 .................................................................................. 101

• Crimes Legislation Amendment (Organised Crime and Other Measures) Bill 2012*, dated March 2013 .............................................................. 129

• Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2013, dated June 2013 ................................................................................... 163

• Customs Amendment (Miscellaneous Measures) Bill 2012*, dated March 2013 ................................................................................................. 187

• Marriage Amendment (Celebrant Administration and Fees) Bill 2013* and Marriage (Celebrant Registration Charge) Bill 2013*, dated June 2013 .................................................................................. 203

• Migration Amendment (Offshore Resources Activity) Bill 2013*, dated June 2013 .................................................................................. 233

• Migration Amendment (Temporary Sponsored Visas) Bill 2013*, dated June 2013 .................................................................................. 265

• Migration Amendment (Unauthorised Maritime Arrivals and Other Measures) Bill 2012*, dated February 2013 .......................................................... 321

The following report was printed separately to this volume: • Exposure Draft of the Human Rights and Anti-Discrimination Bill 2012, [see PP 40/2013]

† Volume 7 contains further reports of the Legal and Constitutional Affairs Committee

*Provisions of bill referred to committee.

The Senate

Foreign Affairs, Defence and Trade

Legislation Committee

International Organisations (Privileges and Immunities) Amendment Bill 2013

June 2013

1

 Commonwealth of Australia 2013

ISBN 978-1-74229-834-4

Printed by the Senate Printing Unit, Parliament House, Canberra

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Members of the committee Core members Senator the Hon Ursula Stephens, ALP, NSW (Chair) Senator Alan Eggleston, LP, WA (Deputy Chair) Senator Mark Bishop, ALP, WA Senator David Fawcett, LP, SA Senator Anne McEwen, ALP, SA Senator Scott Ludlam, AG, WA

Secretariat Dr Kathleen Dermody, Committee Secretary Mr Owen Griffiths, Principal Research Officer Miss Jedidiah Reardon, Senior Research Officer Ms Penny Bear, Research Officer Ms Jo-Anne Holmes, Administrative Officer

Senate Foreign Affairs, Defence and Trade Committee Department of the Senate PO Box 6100 Parliament House Canberra ACT 2600 Australia

Phone: + 61 2 6277 3535 Fax: + 61 2 6277 5818 Email: fadt.sen@aph.gov.au Internet:http://www.aph.gov.au/Parliamentary_Business/Committees/Senate_Committ ees?url=fadt_ctte/index.htm

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Table of Contents

Members of the committee ......................................................................................... iii

Chapter 1

Terms of the inquiry ................................................................................................. 1

Background ............................................................................................................. 1

Purpose of the bill ................................................................................................... 1

Scrutiny of Bills Committee Inquiry ...................................................................... 1

Parliamentary Joint Committee on Human Rights ................................................. 1

Conduct of the Inquiry ............................................................................................ 2

Acknowledgements ................................................................................................ 3

Chapter 2

Purpose of the bill ..................................................................................................... 5

The Arrangement between Australia and the ICRC ............................................... 5

The Agreement on Privileges and Immunities of the ICC ('ICC Agreement') ...... 6

Amendments to the International Organisations (Privileges and Immunities) Act 1963 .................................................................................................................. 6

Chapter 3

Consideration of the Bill .......................................................................................... 9

ICRC ....................................................................................................................... 9

Professor Ben Saul, University of Sydney ............................................................. 9

Conclusion—human rights issues and regulations ............................................... 10

Appendix 1 Public submissions ............................................................................................... 13

Appendix 2 Arrangement between the Government of Australia and the International Committee of the Red Cross on a Regional Headquarters in Australia ............... 15

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Chapter 1 Terms of the inquiry

Background 1.1 The International Organisations (Privileges and Immunities) Amendment Bill 2013 (the bill) was introduced into the Senate on 13 March 2013.

1.2 On 21 March 2013, pursuant to the Senate Selection of Bills Committee Report, the provisions of the bill were referred to the Senate Foreign Affairs, Defence and Trade Legislation Committee for inquiry and report by 25 June 2013. The committee was asked to consider the bill, in the context of 'changes to legal immunity of international organisations, which potentially raises complex legal issues.'1

Purpose of the bill 1.3 The Department of Foreign Affairs and Trade (DFAT) informed the committee that a widely accepted feature of the international systems was that:

…in order to function effectively, international organisations require a certain minimum of freedom and legal security for their assets, headquarters and other establishments and for their personnel and representatives of member states accredited to the organisations.2

1.4 The bill amends the International Organisations (Privileges and Immunities) Act 1963 (the Act) to allow for the enactment of regulations which confer privileges and immunities on the International Committee for the Red Cross (ICRC) and the International Criminal Court (ICC). For example, the 'Arrangement between the Government of Australia and the International Committee of the Red Cross on a Regional Headquarters in Australia' (the Arrangement) between Australia and the ICRC includes immunities such as the inviolability of ICRC premises, property, assets and archives and confidentiality of communications and immunity from censorship of communications. Draft regulations have not been circulated with the text of the bill.

Scrutiny of Bills Committee Inquiry 1.5 The Scrutiny of Bills Committee considered the bill according to its usual scrutiny process and did not have comments in relation to the scrutiny principles outlined in Senate Standing Order 24.3

Parliamentary Joint Committee on Human Rights 1.6 The Parliamentary Joint Committee on Human Rights (PJCHR) examines bills and legislative instruments for compatibility with human rights and reports to

1 Selection of Bills Committee, Report No. 4 of 2013, Appendix 10.

2 Submission 2, p. 1.

3 Scrutiny of Bills Committee, Alert Digest No. 5 of 2013, 14 May 2013, p. 65.

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both Houses of Parliament on these issues.4 The PJCHR examined the bill in its fourth report of 2013.

The Arrangement between Australia and the ICRC

1.7 The PJCHR noted that the purpose of the amendments in the bill is to give effect to the Arrangement between Australia and the ICRC, however, the PJCHR was not able to access a copy of the Arrangement. Without access to the document, the PJCHR wrote in its report that it:

…does not know the extent of the privileges and immunities proposed to be conferred on the ICRC. The extent and nature of those privileges and immunities to be conferred may affect the committee's assessment of whether the bill is compatible with human rights.5

1.8 The PJCHR referred to its intention to write to the Minister for Foreign Affairs seeking a copy of the Arrangement and to recommend that a copy be made publicly available.6 The bill specifies that a copy of the text of the Arrangement will be set out in the regulations.7

Other considerations

1.9 In its report, the PJCHR discussed a number of other issues which they identified as being linked to the bill—including Australia's obligations in relation to the conferral of privileges and immunities on international organisations and foreign states and their officials; immunity as a permissible restriction on the right of access to court; and the impact of the Convention against Torture on the immunity of a former official.

1.10 The issues are examined in more depth in the PJCHR's report which also noted its intention to write to the Minister for Foreign Affairs to seek clarification with regards to them. The PJCHR's report noted that 'while the changes proposed by the bill give rise to these issues, they are not specific to the two organisations covered by the bill.'8

Conduct of the Inquiry 1.11 The committee advertised the inquiry on its website. It also wrote to relevant ministers, departments and organisations, including the ICRC and the ICC Secretariat, inviting them to make submissions to the inquiry. The committee received three submissions, which are listed at Appendix 1 and published on the committee's website.

4 Parliamentary Joint Committee on Human Rights, Fourth Report of 2013, p. iii.

5 Parliamentary Joint Committee on Human Rights, Fourth Report of 2013, p. 44.

6 Parliamentary Joint Committee on Human Rights, Fourth Report of 2013, p. 44.

7 International Organisations (Privileges and Immunities) Amendment Bill 2013, item 1, Schedule 1.

8 Parliamentary Joint Committee on Human Rights, Fourth Report of 2013, p. 43.

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1.12 In light of the response to the committee's call for submissions and the general approval given to the proposed amendments to the Act, the committee did not proceed with a public hearing.

Acknowledgements 1.13 The committee thanks all those who assisted with the inquiry.

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Chapter 2 Purpose of the bill

The Arrangement between Australia and the ICRC 2.1 In 2005, Australia signed the 'Arrangement between the Government of Australia and the International Committee of the Red Cross on a Regional Headquarters in Australia' (the Arrangement).1 The Arrangement 'confers legal personality on the ICRC in Australia and other privileges and immunities needed to facilitate its work in Australia and the Pacific Region.'2

2.2 According to the explanatory memorandum, the Act allows privileges and immunities to be conferred on 'international' and 'overseas' organisations but the definitions of the terms are too narrow 'to accommodate the independent and non-governmental character of the ICRC'.3 It explained further that rather than extend the

current definitions, the changes will provide a legislative basis for conferring privileges and immunities on the ICRC but 'will not inadvertently encompass any other organisations'.4

2.3 DFAT told the committee that the ICRC is one of Australia's most effective partners in humanitarian action. It stated further:

Given Australia's increasing cooperation with the ICRC, including through its aid program and regular visits of ICRC officials, it is appropriate and important to provide these privileges and immunities in Australia.5

2.4 Paragraph 17 of the Arrangement provides for its commencement once the Australian Government makes legislative changes needed to give effect to the clauses of the Arrangement.6 The key purpose of the bill is to provide the legislative change needed to commence the Arrangement. In its submission, the ICRC welcomed the bill and agreed with the DFAT submission that the bill would:

…confer legal personality on the ICRC in Australia's domestic legal order and will provide privileges and immunities to the organisation and its delegates as are needed for the ICRC to fulfil its mandate in full conformity with its fundamental principles and working methods and otherwise facilitate its work in Australia and the Pacific region.7

1 Submission 2, p. 1.

2 Submission 2, p. 1.

3 Explanatory Memorandum, International Organisations (Privileges and Immunities) Amendment Bill 2013, p. 2.

4 Explanatory Memorandum, International Organisations (Privileges and Immunities) Amendment Bill 2013, p. 2.

5 Submission 2, p. 2.

6 Submission 2, p. 1.

7 Submission 1, p. 1.

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The Agreement on Privileges and Immunities of the ICC ('ICC Agreement') 2.5 DFAT's submission noted that Australia became a party to the Rome Statute of the International Criminal Court (Rome Statute) in 2002 and is a strong supporter of the ICC. DFAT explained that the amendments to the bill—new sections and related consequential clauses—provides a legislative basis for implementing the 2002 Agreement on Privileges and Immunities of the International Criminal Court (ICC Agreement).8

2.6 Professor Ben Saul noted that Article 43 of the Rome Statute gives the ICC the privileges and immunities necessary to undertake its work.9 He argued that Australia is bound by Article 43—the ICC Agreement is an elaboration of the obligations in Article 43. Professor Saul stated that Australia has not acceded to the ICC Agreement.10 DFAT explained in its submission that the amendments contained in the bill in relation to the ICC 'place Australia in a position to take steps towards acceding to the [ICC] Agreement'.11

2.7 According to the explanatory memorandum, regulations made under the Act at the moment 'may confer privileges and immunities on international tribunals, such as the ICC, and persons associated with such tribunals'. The Act does not refer to victims participating in proceedings before these tribunals. This gap is being addressed by inserting a new section that 'ensures that the Act provides an adequate basis for the enactment of regulations conferring privileges and immunities on the ICC, including victims participating in proceedings in accordance with the ICC Agreement'.12

2.8 The amendment 'ensures that the privileges and immunities conferred on the ICC will be limited to those set out in the ICC Agreement'.13

Amendments to the International Organisations (Privileges and Immunities) Act 1963 2.9 The explanatory memorandum described the purpose of the bill as creating legislative basis for the making of regulations which will implement the Arrangement between Australia and the ICRC and bring Australia in line with its obligations under the Rome Statute.

2.10 The amendments allow for:

8 Submission 2, p. 2.

9 Submission 3, p. 1.

10 Submission 3, p. 1.

11 Submission 2, p. 2.

12 Explanatory Memorandum, International Organisations (Privileges and Immunities) Amendment Bill 2013, p. 2.

13 Explanatory Memorandum, International Organisations (Privileges and Immunities) Amendment Bill 2013, p. 2.

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 insertion of definitions of the ICRC and ICC (subsection 3(1));

 provides for regulations to be made to confer privileges and immunities in

respect of the ICRC (new section 9C);

 provides for regulations to be made to confer privileges and immunities in

respect of the ICC (new section 9D);

 ensures future discretion for the declaration of relevant conferences and

missions in regards to the ICRC and ICC (amendments to subsection 3(1), section 7 and subsection 9B); and

 makes a consequential amendment in relation to the section on protection of

names and so on of international organisations in relation to the ICRC (amendment to subsection 12(1)).

2.11 None of the three submissions expressed concerns in relation to the amendments listed above. The committee was provided with a copy of the Arrangement between Australia and the ICRC and had the opportunity to reassure itself that the bill gives adequate legislative scope to implement the Arrangement.

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Chapter 3

Consideration of the Bill

3.1 The three submissions received by the committee all support the amendments outlined in the bill. The submissions are from the ICRC, DFAT, and Professor Ben Saul (University of Sydney). DFAT's submission has been discussed in the previous chapter in the context of the provisions of the bill.

ICRC 3.2 The ICRC's submission supported the provisions of the bill and explained that:

…the amendments made by this Bill will confer legal personality on the ICRC in Australia's domestic legal order and will provide privileges and immunities to the organisation and its delegates as are needed for the ICRC to fulfil its mandate in full conformity with its fundamental principles and working methods and otherwise facilitate its work in Australia and the Pacific region.1

3.3 In particular, the ICRC's submission noted that the bill will give effect to what the ICRC sees are a vital part of its ICRC Arrangement with Australia: the protection of the 'confidentiality of ICRC reports, correspondence and other communications.'2 The ICRC argued that this protection is essential for the organisation to be able to carry out its work:

The ICRC's ability to engage with the parties to an armed conflict, to access conflict areas, civilian populations and persons in detention, and the security of its staff, depend on the preservation of the confidentiality of its dialogue and exchanges with all concerned.3

Professor Ben Saul, University of Sydney 3.4 Professor Saul's submission supported the bill's intention to give domestic privileges and immunities to the ICRC and the ICC. He noted that it is 'internationally accepted that privileges and immunities are necessary to enable these organisations to carry out their functions.'4

3.5 In support of the ICRC's argument for confidentiality of ICRC

communications, Professor Saul noted that:

1 Submission 1, p. 1.

2 Submission 1, p. 1.

3 Submission 1, p. 1.

4 Submission 3, p. 1.

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Such obligations have also reached the status of international customary law. The ICRC is accorded immunity from the ICC and 80 states have recognised its immunity through legislation or agreements.5

3.6 In relation to the amendments regarding the ICC in the bill, Professor Saul was also supportive, noting:

Article 43 of the Rome Statute 1998 provides the ICC with such privileges and immunities as are necessary for the fulfilment of its purposes. Although Australia has not acceded to the 2002 Agreement on Privileges and Immunities of the ICC, the Agreement should not be viewed in isolation, but rather as an elaboration of the general obligations in Article 43 of the Statute, which does bind Australia.6

3.7 Professor Saul also observed that whether the scheme would 'adequately achieve its purpose depends on the detail of the implementing regulations', which are currently unknown. He urged the government to ensure that 'the regulations give effect to the full extent of privileges and immunities recognised in international treaty and customary law'.7

Conclusion—human rights issues and regulations 3.8 The committee notes the human rights concerns raised by the PJCHR and, further, that the PJCHR is taking action to obtain information relating to these concerns. The committee agrees with the submission from Professor Saul that:

…we do not think that this Bill is the appropriate avenue by which to reconsider this wider controversy about the contemporary scope of state or international organisation immunities.8

3.9 The committee notes and agrees with Professor Saul's suggestion that the appropriate place to consider these issues is through a review of the Foreign States Immunities Act 1985 undertaken by a body such as the Australian Law Reform Commission.9

3.10 The committee notes that the regulations to be made under the Act (as proposed to be amended by the bill) are not yet available and that, as mentioned by Professor Saul and the PJCHR, the absence of draft regulations means that it is difficult to be sure that the regulations adequately implement the Arrangement. The committee encourages DFAT to continue to work with the ICRC and the ICC, as well as any other relevant departments, to ensure that the regulations adequately implement the agreements to which Australia is a party.

5 Submission 3, p. 1.

6 Submission 3, p. 1.

7 Submission 3, p. 1.

8 Submission 3, p. 2.

9 Submission 3, p. 2.

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Recommendation 1

The committee recommends that the regulations to be made under the bill be drafted and circulated as soon as possible to allow certainty for the ICRC and the ICC.

Recommendation 2

The committee recommends that the bill be passed.

Senator the Hon Ursula Stephens

Chair

Senate Foreign Affairs, Defence and Trade Legislation Committee

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Appendix 1

Public submissions 1 International Committee of the Red Cross (ICRC)

2 Department of Foreign Affairs and Trade

Attachment: Arrangement between the Government of Australia and the International Committee of the Red Cross on a Regional Headquarters in Australia

3 Professor Ben Saul, University of Sydney

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Appendix 2

Arrangement between the Government of Australia and the International Committee of the Red Cross on a Regional Headquarters in Australia

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Arrangement Between

The Government of Australia And

The International Committee. of the Red Cross ("ICRC") On a Regional Headquarters in Australia

The Government of Australia and the International Committee of the Red Cross ("the Parties")

Considering the work done by the ICRC in providing, without discrimination, protection and assistance with a view to relieving human suffering,

Bearing in mind the wish expressed by the ICRC to establish a delegation to carry out the humanitarian tasks entrusted to it under the 1949 Geneva Conventions and the 1977 Additional Protocols, to which Australia is a party, and the Statutes of the International Red Cross and Red Crescent Movement,

Have reached the following understandings:

1. Status of the ICRC

The status of the ICRC in Australia will be comparable to that of an intergovernmental organisation.

2. Juridical Personality

The Government of Australia will confer upon the ICRC juridical personality and such legal capacities as are necessary for the exercise of the powers, and the performance of the functions, of the organisation.

3. Immunity of the ICRC, its Property and Assets

1. The ICRC, its property and assets, wherever located and by whomsoever held, will enjoy immunity from every form of legal process, except insofar .as in any particular case the ICRC has expressly waived its immunity.

2. The immunity from suit and from other legal process conferred by paragraph 3.1 on the ICRC does not extend to immunity from a suit or other legal process:

(a) for the recovery of damages in respect of any damage, injury or death resulting from an accident in which a motor vehicle owned by, or operated on behalf of, the ICRC was involved;

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(b) in relation to:

(i) any contract entered into by the ICRC for the supply of goods or serviCes; (ii) any loan, or other transaction for the provision of finance, by or to the ICRC; or

(iii) any contract of guarantee or indemnity to which the ICRC is a party;

(c) by way of, or in relation to, a counter-claim made against the ICRC by a party to proceedings instituted by the ICRC; or

(d) in respect of the attachment, in accordance with a fmal order of a Conrt, of any amount payable as salary, wages or other remuneration by the ICRC to any person who holds an office in the ICRC or any expert assisting the ICRC.

4. Inviolability ofiCRC Premises, Property and Assets

I. The premises of the ICRC will be inviolable. The property and assets of the ICRC, wherever located and by whomsoever held, will be immune from search, requisition, confiscation, or expropriation.

2. No authorities of the Government of Australia will enter the premises of the ICRC to perform any duties therein without the consent of, and under conditions agreed to by, the ICRC. Such consent will however be deemed to have been provided in the case of fire or other emergency requiring immediate protective action.

5. Inviolability ofiCRC Archives

The ICRC's archives and, in general, all documents belonging to it or held by it, will be inviolable, wherever located.

6. Communications

I. The ICRC will enjoy in Australia for its official communications treatment not less favourable than that accorded by the Government to any other international organisation or diplomatic mission, in the matter of priorities, rates and surcharges, taxes, fees and surcharges on mail, cables, telegrams, telexes, radiograms, telefax, telephone

and other means of communications, apparatus licence taxes and charges, and press rates for information to the press and radio.

2. All official correspondence and other official communications to and from the ICRC premises by whatever means or in whatever form transmitted will be immune from censorship.

3. The ICRC will have the right in Australia to use codes and to dispatch and receive correspondence and other communications either by courier or in sealed bags which will

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have immunities and privileges not less favourable than those accorded to diplomatic couriers and bags.

4. Subject to compliance with applicable Australian laws and regulations, the ICRC may operate a corporate network between its offices within and outside Australia for voice and data services and may install and operate in Australia point-to-point telecommunication facilities and other communication and transmission facilities as may be necessary to facilitate communications with the ICRC's premises both from within and outside Australia.

7. Financial Resources ofthe ICRC

I. The ICRC may hold national or foreign currency and other financial assets, and operate accounts in any currency, without being subject to the laws and regulations governing exchange control and related matters.

2. The ICRC may freely transfer funds in national or foreign currency to, from and within the country, and convert such assets freely into other currencies.

8. Exemption from Customs Duties

I. The ICRC will be exempt from customs duties or any equivalent charge and from restrictions and prohibitions on the import, export or transit through Australia of articles (including ICRC publications and audio-visual materials) for official use and of articles intended for ICRC assistance programmes within Australia or in another country.

2. Nothing in this Arrangement affects the application of any law of the Commonwealth or of a Territory of the Commonwealth relating to quarantine, or prohibiting or restricting the importation into, or the exportation from, Australia or that Territory, as the case may be, of any animals, plants or goods but this paragraph does not prejudice the immunity from suit or from civil or criminal process conferred by this Arrangement.

9. Status of Delegates of the ICRC

I. In respect of acts and things done in his or her capacity as a Delegate of the ICRC, a Delegate will be immune from suit and from other ]ega! process and, for the avoidance of doubt, may not be called as witness in respect of acts and things done in his or her capacity as a Delegate, even after he or she has left the services of the. delegation.

2. Delegates of the ICRC and their families will be exempt for the application of laws relating to national service obligations. Such exemption will not, however, apply to nationals of Australia. Should Delegates who are nationals of Australia be called for national service, the Government will endeavour to grant deferment when, in the opinion

of the ICRC, serious disruption to essential ICRC operations may occur.

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3. The ICRC will inform the competent authorities of arrivals in and departures from the country, and of the titles and functions of staff working in Australia.

4. When first taking up a post in Australia, Delegates of the ICRC will have the right to import their personal effects duty free, and to export their personal effects duty free when leaving Australia on the termination of their function.

5. In the event of an international crisis, the Delegates of the ICRC will be granted repatriation facilities like those accorded to a diplomatic agent.

6. Delegates of the ICRC will benefit from the same privileges in. respect of exchange facilities as are accorded to the members, of comparable rank, of diplomatic missions.

7. Delegates of the ICRC will be exempted from taxation on salaries and emoluments received from the ICRC. However, Australian citizens and permanent residents of Australia who are employed by the ICRC in Australia will not be exempted from taxation on salaries and emoluments received from the ICRC.

8. The ICRC and its personnel will respect the laws and regulations in force in Australia, as may be relevant before they enter, and from the moment they arrive in the country and may. benefit from their protection.

9. The privileges, immunities, exemptions and facilities accorded in this Arrangement are granted in the interest of the ICRC and not for the personal benefit of the individuals themselves. Persons accorded privileges and immunities by way of this Arrangement are under a duty to obey the laws and regulations of Australia. The ICRC will waive the immunity accorded to any person if, in its opinion, such immunity would impede the course of justice and the waiver would not prejudice the purposes for which the immunities are accorded.

10. The ICRC will take every measure to ensure that the privileges, immunities, exemptions and facilities conferred by this Arrangement are not abused and for this purpose will establish such rules and regulations as it may deem necessary and expedient. There will be consultation between the Government and the ICRC, should the

Government consider that an abuse has occurred.

10. ICRC Representatives on Temporary Mission

Representatives of the ICRC on temporary mission in Australia will, in respect of acts and things done in their capacity as such a representative, ·enjoy the same privileges and immunities as outlined in sub-paragraphs (1), (2), (5) and (6) of paragraph 9 of this Arrangement.

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11. Confidentiality ofiCRC Communications

The Government of Australia undertakes to respect the confidentiality ofiCRC reports, correspondence and other communications. This includes an undertaking not to divulge their contents to persons and/or organisations other than the designated recipients and not using them in the course of legal proceedings without prior written authorisation from the ICRC.

12. Identity Document and Commission

1. Delegates of the ICRC and ICRC representatives on temporary mission will hold a document called "Identity document and commission", attesting to the bearer's status as an ICRC staff member.

2. The possession of such a document, however, will not remove the need for Delegates of the ICRC and ICRCrepresentatives on temporary missions to hold an official or personal passport issued from their national authority as evidence of identity.

3. Delegates of the ICRC and ICRC representatives on temporary missions will be required to hold valid visas in order to travel to, enter and remain in Australia and \'.'t:l be required to comply with any visa restrictions or conditions.

13. Co-operation with the Host Country

I. The ICRC will co-operate with the authorities at all times with a view to preventing any form of abuse of the privileges, immunities and facilities provided for in this Arrangement

2. The ICRC may waive the innnunity granted to one of its Delegates in any case where, in its opinion, the innnunity would impede the course of justice and can be waived without prejudice to the interests of the ICRC.

14. Interpretation

This Arrangement will be interpreted in the light of its primary objectives, which are to enable the ICRC to assume its responsibilities, to discharge its duties and to carry out its programmes fully and efficiently.

15. Settlement of Disputes by Negotiation

1. ·Any dispute between the Parties arising out of the interpretation or application of this Arrangement will be settled by negotiation between the Parties.

2. The Parties will bear in mind the national interests of Australia and the interests of the ICRC related to its activities. They will do everything possible to see that disputes are

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settled in good faith and equitably, and with the discretion essential to continued good relations between the Parties.

16. Amendments

This Arrangement may be amended at any time by the mutual written consent of the Parties.

17. Commencement

This Arrangement will come into effect on the date on which the Government of Australia notifies the ICRC that legislation giving effect to the relevant provisions of this Arrangement has commenced.

18. Termination

Either Party may terminate this Arrangement by providing the other PartY with a minimum of six months' written notice.

SIGNED AT CANBERRA ON TlillRSDAY 24 NOVEMBER 20051N TWO ORIGINALS IN ENGLISH.

FOR THE GOVERNMENT OF AUSTRALIA

Michael L'Estrange Secretary Department of Foreign Affairs & Trade

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FOR THE INTERNATIONAL COMMITTEE OF THE RED CROSS

Reto/ Meister ·

Deldgate General for Asia and Pacific

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AnnexA

In addition to the privileges and immunities granted to the ICRC in this Arrangement, the Parties note that the Government ofN ew South Wales has given its approval for the ICRC to be exempt from the following:

Duty on insurance taken out by or on behalf of the ICRC, not being a policy of life insurance under the Duties Act 1997 (NSW);

Duty in respect of an application to register a motor vehicle in New South Wales, under the Duties Act 1997 (NSW);

Pay-roll tax on the wages paid to employees engaged in the work of the ICRC.

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The Senate

Foreign Affairs, Defence and Trade

Legislation Committee

Veterans' Affairs Legislation Amendment (Military Compensation Review and Other Measures) Bill 2013 [Provisions]

June 2013

31

 Commonwealth of Australia 2013

ISBN 978-1-74229-847-4

Printed by the Senate Printing Unit, Parliament House, Canberra

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Members of the committee Core members Senator the Hon Ursula Stephens, ALP, NSW (Chair) Senator Alan Eggleston, LP, WA (Deputy Chair) Senator Mark Bishop, ALP, WA Senator David Fawcett, LP, SA Senator Anne McEwen, ALP, SA Senator Scott Ludlam, AG, WA

Participating members who contributed to the inquiry Senator the Hon Michael Ronaldson, LP, VIC

Secretariat Dr Kathleen Dermody, Committee Secretary Mr Owen Griffiths, Principal Research Officer Ms Jo-Anne Holmes, Administrative Officer

Senate Foreign Affairs, Defence and Trade Committee Department of the Senate PO Box 6100 Parliament House Canberra ACT 2600 Australia

Phone: + 61 2 6277 3535 Fax: + 61 2 6277 5818 Email: fadt.sen@aph.gov.au Internet: www.aph.gov.au/senate_fadt

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Table of Contents

Members of the committee ............................................................................... iii

Chapter 1

Introduction .............................................................................................................. 1

Referral of inquiry .................................................................................................. 1

Background ............................................................................................................. 1

Military compensation schemes .......................................................................... 1

Review of Military Compensation Arrangements............................................... 2

Government response .......................................................................................... 2

Conduct of inquiry .................................................................................................. 3

Structure of report ................................................................................................... 4

Acknowledgement .................................................................................................. 4

Chapter 2

Provisions of the bill and other issues ..................................................................... 5

Introduction ............................................................................................................ 5

Schedule 1—Rehabilitation and transition management ....................................... 5

Schedule 2—Compensation for permanent impairment ........................................ 6

Date of effect and lifestyle factor ........................................................................ 6

Transitional permanent impairment compensation ............................................. 8

Schedule 3—Expanded lump sum options for wholly dependent partners ........... 9

Schedule 4—Weekly compensation for eligible young persons .......................... 10

Schedule 5—Compensation for financial advice and legal advice ...................... 11

Schedule 6—Special Rate Disability Pension ...................................................... 13

Schedule 7—Superannuation ............................................................................... 15

Schedule 8—Remittal power of Veterans' Review Board ................................... 17

Schedule 9—Membership of the Military Rehabilitation and Compensation Commission .......................................................................................................... 19

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Schedule 10—Aggravation of or material contribution to war-caused or defence-caused injury or disease ........................................................................................ 20

Schedule 11—Treatment for certain SRCA injuries ............................................ 22

Financial impact ................................................................................................ 22

Privacy issues .................................................................................................... 23

Schedule 12—Members ....................................................................................... 25

Schedule 13—Treatment costs ............................................................................. 25

Schedule 14—Travelling expenses ...................................................................... 26

Schedule 15—Payments into accounts ................................................................. 27

Schedule 16—Other amendments ........................................................................ 27

Commencement .................................................................................................... 28

Other issues .......................................................................................................... 28

Support for reform ............................................................................................. 28

Conduct of the Review and consultation ........................................................... 29

Service differential ............................................................................................ 30

Time frames ....................................................................................................... 31

Chapter 3

Committee view and recommendation ................................................................. 33

Committee view .................................................................................................... 33

Consultation and Review membership .............................................................. 33

Offsetting of commonwealth superannuation ................................................... 33

Privacy issues .................................................................................................... 34

Definition of financial advisor .......................................................................... 34

Time frames ....................................................................................................... 34

Appendix 1 Public submissions ............................................................................................... 37

Appendix 2 Answers to written questions on notice ................................................................ 39

36

Chapter 1 Introduction

Referral of inquiry 1.1 On 21 March 2013, the Senate referred the provisions of the Veterans' Affairs Legislation Amendment (Military Compensation Review and Other Measures) Bill 2013 (bill) to the Foreign Affairs, Defence and Trade Legislation Committee (committee) for inquiry and report by 14 May 2013.1 On 14 May 2013, the Senate extended the time for reporting to 17 June 2013.2

Background

Military compensation schemes

1.2 There are several pieces of legislation which form the military compensation arrangements in Australia. These include:

• the Military Rehabilitation and Compensation Act 2004 (MRCA);

• the Veterans’ Entitlements Act 1986 (VEA);

• the Safety, Rehabilitation and Compensation Act 1988 (SRCA); and

• the Defence Act 1903.

3

1.3 The benefits a person may be entitled to when claiming for compensation will vary depending on: the date on which the injury or illness occurred, the period of service to which an injury or disease can be related, the type of service, and the period of time served.4

1.4 In particular, the MRCA was enacted to bring together the rehabilitation and compensation provisions for all members of the Australian Defence Force (ADF), cadets, cadet instructors and members of the Reserve Forces. It incorporated the rehabilitation focus and many of the benefit structures of the SRCA and, according to the Government's response, includes some desirable features of the VEA. The MRCA is the rehabilitation and compensation scheme that covers ADF members currently serving, including those deployed overseas.5

1 Journals of the Senate, 21 March 2013, p. 3866.

2 Journals of the Senate, 14 May 2013, p. 3884.

3 Luke Buckmaster and Paula Pyburne, 'Veterans' Affairs Legislation Amendment Bill 2012', Bill Digest, 17 August 2012, pp. 2-3.

4 'About DVA Compensation Payments', Guide to Social Security Law, section 4.3.5, http://guidesacts.fahcsia.gov.au/guides_acts/ssg/ssguide-4/ssguide-4.3/ssguide-4.3.5/ssguide-4.3.5.60.html (accessed 13 May 2013).

5 Government Response to the Review of Military Compensation Arrangements (Government response), p. 3.

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Review of Military Compensation Arrangements

1.5 On 8 April 2009, the then Minister for Veterans' Affairs, the Hon Alan Griffin MP, announced a Review of Military Compensation Arrangements (Review). The Review was intended to 'examine the operation of the current military compensation schemes with specific reference to the [MRCA]'.6 The Review was conducted by a Steering Committee, consisting mainly of senior public servants, chaired by Mr Ian Campbell PSM, Secretary of the Department of Veterans' Affairs (DVA).7

1.6 On 18 March 2011, the Review's report was released. The Hon

Warren Snowdon MP, Minister for Veterans' Affairs (Minister) stated that the Review report found that 'there are no fundamental flaws in what is a complex and relatively new scheme' but that 'some improvements could be made'.8 The Review report made 108 recommendations covering a wide range of issues, including 28 recommendations calling for legislative change. Feedback on the report was invited from defence and veteran communities.9

Government response

1.7 The Government responded to the report of the Review on 8 May 2012 and announced it would commit $17.4 million over the next four years to implementing the recommendations accepted from the Review. As part of its response the government decided to implement 96 of the Review's recommendations—accepting 94 recommendations, either in full or with modification, and replacing two recommendations with 'favourable outcomes'.10 In particular, the Minister highlighted a number of initiatives, including:

- A new method for calculating permanent impairment compensation across multiple Acts (or transitional claims) under the [MRCA]. All those who have claimed permanent impairment compensation under MRCA and been subject to the method for permanent impairment across multiple Acts, since the Act commenced on 1 July 2004, to be reassessed with many receiving increased compensation;

- Around 6000 former Australian Defence Force members with chronic health conditions accepted under the [SRCA], subject to a needs assessment showing long-term treatment needs, to receive a White Repatriation Health Card for specific conditions and the supplementary payment for pharmaceuticals;

6 The Hon Alan Griffin MP, Minister for Veterans' Affairs, 'Government moves to review military compensation', Media Release, 8 April 2009, p. 1.

7 Department of Veterans' Affairs (DVA), Review of Military Compensation Arrangements, Volume 1, February 2011, pp. 61-62.

8 The Hon Warren Snowdon MP, Minister for Veterans' Affairs, 'Military Compensation Review Report Released', Media Release, 18 March 2011, p. 1.

9 The Hon Warren Snowdon MP, Minister for Veterans' Affairs, 'Military Compensation Review Report Released', Media Release, 18 March 2011, p. 1.

10 DVA, Submission 5, p. 1.

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- Earlier access to compensation with claims under permanent impairment compensation under the MRCA for multiple conditions receiving compensation as each condition stabilises, rather than having to wait for all conditions to stabilise;

- The Eligible Young Person periodic payment, under MRCA, to be increased to match the SRCA equivalent. (Current weekly rates are $84.94 under the MRCA and $126.22 under the SRCA);

- Compensation payable for financial advice under MRCA, for certain beneficiaries who have made a choice about how they want to receive their benefits, to increase to $2400 (currently $1544); and

- Greater flexibility for future wholly dependent partners in the way they receive compensation with the option to convert part of their compensation to a lump sum payment.11

1.8 DVA indicated that consultation on the contents of the draft bill was conducted with representatives of the Ex-Service Organisation Round Table in Canberra on 7 March 2013:

Attendees were guided through marked up legislation for changes to implement 19 recommendations and one observation. They were also provided with draft instruments implementing three recommendations and briefed on the outcomes of work on three other recommendations.

The representatives were invited to provide feedback on the draft Bill and instruments during the session, and also invited to provide further feedback once they had time to consider the proposed changes.12

Conduct of inquiry 1.9 The committee advertised its inquiry on its webpage, and in The Australian, calling for submissions to be lodged by 18 April 2013. The committee also wrote directly to a range of people and organisations likely to have an interest in matters covered in the bill, drawing their attention to the inquiry and inviting them to make written submissions. Details of the inquiry, the bill and associated documents were placed on the committee's website www.aph.gov.au/senate_fadt.

1.10 The committee received 11 submissions which are listed at Appendix 1. The committee also wrote to DVA to seek its response to concerns raised in submissions. The committee received answers from DVA to its written questions on notice on 4 June 2013. All public submissions and the DVA answers were published on the committee's website.

11 The Hon Warren Snowdon MP, Minister for Veterans' Affairs, 'Improving our military rehabilitation and compensation', Media Release, 8 May 2012, pp. 1-2.

12 DVA, 'Review of Military Compensation Arrangements', http://www.dva.gov.au/pensions_and_compensation/Military%20Compensation%20Review/Pa ges/index.aspx (accessed 13 May 2013).

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Structure of report 1.11 Chapter 2 contains descriptions of amendments to be made by the bill and outlines the issues raised by submitters. Chapter 3 contains the committee's view and recommendation.

Acknowledgement 1.12 The committee thanks those organisations and individuals who made submissions and provided evidence to the committee's inquiry.

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Chapter 2

Provisions of the bill and other issues Introduction 2.1 The provisions of the bill make a number of amendments to the MRCA and other pieces of legislation related to military compensation arrangements, to give effect to initiatives that form part of the Government response to the Review of Military Compensation Arrangements.1 The bill's amendments are contained in 16 schedules. While many submissions focused on the provisions of the bill, several submissions also raised related issues including: the conduct of the Review, the service differential and time frames.

Schedule 1—Rehabilitation and transition management 2.2 The Explanatory Memorandum (EM) to the bill states that Schedule 1 contains amendments to the MRCA and SRCA 'to enhance rehabilitation services and transition management'. The amendments are intended to:

- achieve greater consistency and oversight through the three branches of the Defence Force by redesignating the responsibilities of the Service Chiefs to the Chief of the Defence Force. The Chief of the Defence Force will have the power to delegate and the Service Chiefs to sub-delegate responsibilities including those relating to rehabilitation and transition management;

- provide flexibility in the timing of the transfer of responsibility for rehabilitation for members by allowing the [Military Rehabilitation and Compensation Commission] to be appointed as the rehabilitation authority on the recommendation of the Chief of the Defence Force;

- achieve visibility of care for part-time Reservists by making the Chief of the Defence Force the rehabilitation authority for serving part-time Reservists; and

- provide access to a transition advisory case manager for part-time Reservists.2

2.3 In particular, the amendments to redesignate the responsibilities of the Service Chiefs to the Chief of the Defence Force reflect the recommendations of the Review. The Review found:

Rehabilitation, a matter of critical importance to members being discharged on medical grounds, is coordinated by a tri-Service management structure. However, the MRCA appoints each Service Chief as the rehabilitation authority and the authority for appointment of transition advisory case managers. Greater consistency across the Services is more likely to be

1 EM, p. ii.

2 EM, p. 1.

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achieved if responsibility is assigned under the MRCA to the Chief of the Defence Force (CDF).3

2.4 The aim of the proposed changes to rehabilitation providers were welcomed by Mr Greg Isolani, KCI Lawyers. He stated:

This transitional management is, in my experience of great assist to the serving member transiting out of the ADF and into a civilian capacity when it is effectively executed. It can assist the discharging member to be positively retrained and assisted to find work subject to their medical conditions and opportunities in the labour market as opposed to being 'compensated' which for many can be demoralising.4

2.5 However, Mr Isolani maintained some reservations, noting the example of client who was discharged without adequate transitional management being put in place and highlighted the difficulties veterans can face in accessing tertiary rehabilitation.5

Schedule 2—Compensation for permanent impairment

Date of effect and lifestyle factor

2.6 The EM to the bill states that the amendments contained in Schedule 2 are intended 'to make the date of effect for periodic impairment compensation to be on the basis of each accepted condition rather than all accepted conditions and to incorporate a lifestyle factor in the calculation of interim permanent impairment compensation'.6

2.7 The amendments in Schedule 2 reflect recommendation 8.6 of the Review. The government's response to the Review's recommendation stated:

The Government accepts this recommendation as it will allow the earlier payment of compensation for permanent impairment under the MRCA, for those with more than one accepted condition (under the SRCA, VEA or MRCA), where not all have stabilised to their lowest level of impairment expected after all reasonable rehabilitative treatment. This initiative will also allow the lifestyle effects of the impairment to be compensated at an earlier date. This is an improvement on current access to compensation where all conditions have to be stable before the lifestyle impact can be compensated. This recommendation will be implemented, prospectively, from 1 July 2013, subject to legislation being passed.7

2.8 Slater and Gordon Lawyers considered that clarification was needed in the bill to ensure that 'payments in relation to stabilized conditions that meet the 10 "whole person impairment" points threshold, do not result in failure to compensate conditions

3 DVA, Review of Military Compensation Arrangements, Volume 2, February 2011, p. 58.

4 Submission 10, p. 2.

5 Submission 10, p. 3.

6 EM, p. 6.

7 Government response, p. 15.

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that stabilize later but on their own, do not meet the impairment threshold'. It explained:

Currently, the claimant receives compensation for the combined 15 points when both impairments are stable. Under the amendments as they are currently worded, if the 10 points [whole person impairment] condition was stable and the 5 point was not, the MRCC could pay compensation for the 10 points condition immediately. Our concern is that, when the 5 point condition stabilizes and the claimant seeks payment, unless the Bill is clarified, lump sum compensation could be denied on the basis that the impairment is less than the 10 points threshold.8

2.9 It recommended that the bill be 'clarified to ensure that conditions assessed following an initial condition that has stabilized and that meet the 10 points whole person ampairment threshold, be compensated even though on its own, the subsequent condition is less than 10 points'.9

2.10 DVA disagreed with this analysis of the provisions in Schedule 2, stating that '[w]here a claim for multiple conditions is made, the changes will not result in each condition being required to meet the threshold in order to attract compensation'. It noted that '[p]rovided that the combined impairment of the conditions meets the threshold, their effects will be compensated'.10 In its response, DVA included additional detail on the benefits intended to be achieved by the amendments:

Under the existing legislation, where one or more of the conditions have not stabilised at the date the claim is determined, an interim payment of compensation may be made. This interim payment does not include a factor for lifestyle effects. On stabilisation of all conditions, a final assessment is made, and compensation for lifestyle effects of all conditions is included from the date all of the conditions stabilised.

The amendments proposed in this Bill will apply an imputed lifestyle effect as part of the calculation of any interim payment of compensation. On stabilisation of all conditions, a final assessment will then be made to determine if any additional compensation is payable. This proposal will ensure a person receives compensation for lifestyle effects as part of the interim payment.11

Under the existing legislation, all conditions claimed must have stabilised in order to determine a date of effect.

The amendments proposed in this Bill will enable each condition to have its own date of effect that will depend on the date of the claim and the date the condition meets the requirements for payment of permanent impairment compensation. All conditions will be compensable including any that individually do not meet the relevant threshold.

8 Submission 9, p. 3.

9 Submission 9, p. 3.

10 DVA, answers to written questions on notice, p. 1.

11 DVA, answers to written questions on notice, p. 1.

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This proposal will ensure a person receives their maximum compensation for each condition from the earliest date.12

Transitional permanent impairment compensation

2.11 Schedule 2 also includes a transitional provision applicable to the recalculation of the amount of permanent impairment compensation a person is to be paid for the period prior to 1 July 2013, where the person already has an injury or disease accepted under the VEA and/or the SRCA.13

2.12 The EM to the bill provided further background to these amendments:

Section 13 of the Military Rehabilitation and Compensation (Consequential and Transitional Provisions) Act 2004 provides for a methodology to be included in the Guide to determining impairment and compensation (GARP M) under section 67 of the [MRCA], to calculate the amount of permanent impairment compensation a person is to be paid under the Act where the person already has an injury or disease accepted under the [VEA] and/or the [SRCA].

It has been found that the methodology that has been used may have resulted in a lower or higher net permanent impairment compensation payment than expected (when considered in light of the impairment points suffered as a result of conditions accepted under the [MRCA]), or in a nil payment. This may occur because of differences in the assessment methodologies and the calculation of compensation under the three Acts, and changes in the [VEA] or [SRCA] conditions over time.

As a consequence the methodology has been changed and will be applied both prospectively and retrospectively. Where retrospective application of the new methodology results in a lower amount of compensation for an existing recipient, the existing rate will apply until a new assessment results in a higher amount.

Where the retrospective application of the new methodology results in a higher amount of compensation for an existing recipient, the additional amount will be paid to the recipient as soon as is practicable.

The new methodology will be provided for through the GARP M and therefore no amendments are required to any of the Acts.14

2.13 Mr Greg Isolani, KCI Lawyers, characterised the amendments as modifying the 'offsetting' of permanent impairment (lump sum/periodic payments) for injuries payable under the MRCA for different injuries that have been under the SRCA or pensions under the VEA. However, he noted that offsetting 'to a lesser degree' will remain:15

12 DVA, answers to written questions on notice, p. 1.

13 EM, p. 6.

14 EM, pp. 7-8.

15 Submission 10, p. 3.

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The Military Rehabilitation (Consequential and Transitional Provision) Act 2004 provides a 'method' of calculating permanent impairment i.e. lump sum payments under the MRCA so 'Offsetting' or reducing compensation is achieved by taking into account different injuries for which compensation has been paid under different Acts i.e. SRCA and VEA.16

2.14 Mr Isolani argued that while the MRCA was intended to benefit veterans, older and more experienced veterans would be 'penalised for remaining in the ADF after 1 July 2004'. The changes in Schedule 2 could mean these veterans 'receive less compensation for the NEW and different injury arising after 1 July 2004 due to offsetting'.17

Schedule 3—Expanded lump sum options for wholly dependent partners 2.15 The amendments contained in Schedule 3 expand the options for lump sum compensation for wholly dependent partners of deceased members.18 The DVA submission noted that the amendments in Schedule 3 reflected the Government's agreement to a modified version of recommendation 9.3 of the Review.19 Recommendation 9.3. of the Review was that:

Dependent partners be offered the one-off choice of converting either the whole of the lump sum payment, 75 per cent, 50 per cent or 25 per cent thereof, into a lifetime pension (tax free).20

2.16 The Review made this recommendation recognising the 'requirement for flexibility for a dependent partner to structure his or her compensation so that they meet immediate and long-term financial priorities'.21

2.17 In his Second Reading Speech, the Minister also described the amendments in Schedule 3:

The bill will provide greater flexibility for wholly dependent partners of deceased members under the [MRCA].

From 1 July 2013, instead of a single choice between receiving ongoing compensation payments or a lump sum payment, wholly dependent partners will be able to choose to convert either 25 per cent, 50 per cent, 75 per cent or 100 per cent of the periodic compensation amount to an age based lump sum payment.

This increased flexibility will enable a wholly dependent partner to better meet their immediate and long-term financial priorities, and applies to

16 Submission 10, p. 4.

17 Submission 10, p. 5 (emphasis in original).

18 EM, p. 12.

19 Submission 5, Attachment B, p. 5.

20 DVA, Review of Military Compensation Arrangements, Volume 1, February 2011, p. 48.

21 DVA, Review of Military Compensation Arrangements, Volume 2, February 2011, p. 97.

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future partners and to existing partners who have yet to make their choice as to how to receive their compensation.22

Schedule 4—Weekly compensation for eligible young persons 2.18 Schedule 4 contains amendments intended 'to apply a one-time increase to the rate of periodic compensation payable for dependent children so the rate aligns with similar payments under the [SRCA]'.23 Section 12 of the MRCA provides that compensation for death may be payable to dependents in certain circumstances. As at 1 July 2012, the rate was $87.57 per week (indexed annually against Consumer Price Index). This is below the payment made under similar circumstances under section 17 of the SRCA which is $130.89 per week (indexed against Wage Price Index).24

2.19 On this subject, the Review recommended that the 'MRCA's current pension rate for dependent children…be maintained'. While it noted the differences between the schemes it stated that 'the SRCA does not provide the additional benefits of a separate lump sum payment, Gold Card or non-means tested education assistance to eligible young persons, as the MRCA does'.25 However, the Review's recommendation was rejected in the Government's response. Instead, it was replaced with a 'favourable outcome' to make a one-time increase in the payment under the MRCA to align them with the corresponding payments under the SRCA. The Government response stated:

The Government acknowledges that, at the commencement of the MRCA, the rates under the SRCA and MRCA were the same, however, changes to the SRCA in 2008 resulted in a break in the relativity.26

2.20 The amendments would match the payment under the MRCA to the amount payable under the MRCA on 1 July 2013. However, the EM notes that, as there are different indexation arrangements under the MRCA and the SRCA, the rates for this payment will not remain aligned over time.27

2.21 DVA provided the committee additional information on this amendment:

For the one-off increase provided for under the Bill, the indexation method used by the MRCA was not matched to that used by the SRCA because, in general, periodic payments made under the MRCA are indexed using the Consumer Price Index. In contrast, the SRCA has indexed such payments using the Wage Price Index since 2008.

Although both the MRCA and the SRCA provide periodic payments to dependent children, these payments form only one component of the packages available to eligible children under each Act. In addition to

22 Senate Hansard, 20 March 2013, p. 17.

23 EM, p. 19.

24 EM, p. 19.

25 DVA, Review of Military Compensation Arrangements, Volume 2, February 2011, p. 100.

26 Government response, p. 17.

27 EM, p. 20.

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periodic payments, the MRCA also provides wholly and mainly dependent children with a lump sum payment, access to a Repatriation Health Card- For All Conditions (Gold Card), education assistance and a MRCA supplement. Partially dependant eligible young persons are provided with lump sum compensation and education assistance, but not the periodic payment. In contrast, eligible SRCA claimants will receive part of an overall lump sum for dependants and periodic payments. An additional death benefit lump sum is also available to these SRCA claimants under the Defence Act 1903.28

Schedule 5—Compensation for financial advice and legal advice 2.22 The amendments to Schedule 5 to the MRCA increase the amount of compensation for financial advice and include access to legal advice within the new limit.29 In his Second Reading Speech, the Minister stated:

The bill provides for an increase in the amount of compensation paid for financial advice for those persons who are required to make a choice under the [MRCA] about the nature of the benefits they receive. The maximum compensation available will increase from $1,592 to $2,400 and legal advice related to that choice can also be covered within the new limit.30

2.23 The MRCA currently provides for compensation to certain eligible persons for the provision of financial advice. DVA stated:

These [circumstances] relate to a choice to be made by an eligible person about how a benefit is received i.e. a periodic or lump sum payment of permanent impairment compensation; receiving incapacity payments (taxable to age 65) in lieu of the Special Rate Disability Pension (tax free for life); or a periodic or lump sum payment of compensation following death.31

2.24 The Government's response not only accepted, but enhanced, the original recommendation made by the Review that the 'amount of compensation for financial advice…be increased to at least $2,400 and continue to be indexed by the [Consumer Price Index]'.32 The Government's response stated:

This compensation is payable for financial advice provided by a suitably qualified financial adviser when that advice relates to the choices about benefits related to permanent impairment (lump sum or periodic payment); the choice between SRDP and incapacity payments and the choice by wholly dependent partners between periodic payments and lump sum. The Government has decided to offer additional flexibility within the new limit

28 DVA, answers to written questions on notice, p. 2.

29 EM, p. 21.

30 Senate Hansard, 20 March 2013, p. 17.

31 DVA, Submission 5, Attachment B, p. 9.

32 DVA, Review of Military Compensation Arrangements, Volume 1, February 2011, p. 48.

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to pay for advice received from a legally qualified person, when it relates to the choices previously described.33

2.25 While the Review acknowledged that some persons in these situations would 'benefit from obtaining legal advice' it did not consider this was 'necessarily the role of a compensation scheme such as the MRCA'.34 DVA explained that the amendments in Schedule 5 are 'not intended to cover legal advice that may be required in dealing with other matters such as family court disputes and other legal matters tied to the administration of the estate, nor legal representation of the claim for compensation'.35

2.26 The Financial Planning Association of Australia (FPAA) noted that Parliamentary Joint Committee on Corporations and Financial Services (PJC) was undertaking an inquiry on the Corporations Amendment (Simple Corporate Bonds and Other Measures) Bill 2013. Schedule 2 of that Bill restricts the use of the expressions 'financial planner' and 'financial adviser' to those who are appropriately licensed to provide financial advice to retail clients. The FPAA stated:

The need to restrict the use of the terms financial planner and financial adviser in the Corporations Act will close a significant gap in consumer protection, which currently leaves trusting consumers open to influence by unprofessional and inappropriately qualified individuals portraying to provide financial advice, especially unsolicited advice from people with whom consumers may or may not have a relationship with.36

2.27 The FPAA recommended the adoption of a consistent approach to the definition of 'financial adviser', and recommended that Schedule 5 of the Bill be amended to require financial advice to be obtained from a 'financial planner' or 'financial adviser' who meets all the licensing and competency requirements in the new legislation.37

2.28 However, DVA stated that the amendments will not change the requirements that already exist for the financial advice to be provided by a person qualified and able to provide financial advice. Further, DVA argued:

DVA considers that it would be pre-emptive for the Veterans' Affairs Legislation Amendment (Military Compensation Review and Other Measures) Bill 2013 to include the amendment proposed by the Financial

Planning Association of Australia before a formal government decision is made on the use of the expression 'financial adviser' in legislation.

Nevertheless, it is the view of DVA that there will be sufficient restrictions in the MRCA to prevent payment of compensation for advice sought from persons who do not have appropriate licences or qualifications. The proposed amendments in the Corporations Amendment (Simple Corporate

33 Government response, p. 18.

34 DVA, Review of Military Compensation Arrangements, Volume 2, February 2011, p. 104.

35 DVA, Submission 5, Attachment B, p. 9.

36 Submission 6, p. 1.

37 Submission 6, p. 2.

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Bonds and Other Measures) Bill 2013, if passed, may provide additional protection, and a consequent amendment to the MRCA could also be considered at that time.38

Schedule 6—Special Rate Disability Pension 2.29 The Review report included a brief description of the Special Rate Disability Pension (SRDP):

A former member unable to work because of accepted disabilities may choose the Special Rate Disability Pension in lieu of incapacity payments. Under the SRDP, they are paid an ongoing, tax free amount for life. The SRDP rate is equivalent to the Special Rate of the pension under the [VEA]39…and there are offsets for Commonwealth superannuation and permanent impairment compensation payments. The SRDP was built into the [MRCA] as a safety net.40

2.30 The EM to the bill outlines that a person is eligible to choose the SRDP under section 199 of the [MRCA] if the person:

- is in receipt of incapacity compensation…; and

- has an impairment as a result of the service injuries or diseases that is likely to continue; and

- is assessed at 50 or more impairment points; and

- is unable to undertake paid work for more than 10 hours per week and rehabilitation is unlikely to assist in increasing their capacity to work.41

2.31 The EM highlights that under the existing provisions a person must be 'receiving' incapacity compensation to be eligible for SRDP. Consequently, a person will not be eligible if they had:

• converted their weekly rate of incapacity compensation to a lump sum; or

• is receiving a nil rate of incapacity compensation because the amount is fully

offset by Commonwealth superannuation.42

2.32 As part of its consideration of the SRDP, the Review Committee noted that 'the commutation of a small amount of weekly compensation into lump sum compensation under section 138 of the MRCA will result in a person to become ineligible to make a choice to receive the SRDP, in circumstances where they would have otherwise been eligible'. The Review described this situation as 'anomalous' but

38 DVA, answers to written questions on notice, p. 3.

39 The current rate effective 20 March 2013 is $1238.20, DVA, 'New pension rates', https://myaccount.dva.gov.au/new-pension-rates.html (accessed 8 May 2013).

40 DVA, Review of Military Compensation Arrangements, Volume 2, February 2011, p. 135.

41 EM, p. 26.

42 EM, p. 26.

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did not make a recommendation on this matter.43 Nonetheless, the Government response to the Review addressed this anomaly:

The Government agrees that those former members who have either redeemed small incapacity payments under s138 of the MRCA or whose incapacity payments have been reduced to nil purely because of the value of Commonwealth superannuation, can still be found eligible for SRDP, if all other SRDP criteria are met.44

2.33 Consequently, Schedule 6 contained amendments 'to expand the eligibility criteria for Special Rate Disability Pension (SRDP)'.45 The Minister, in his Second Reading Speech, described the amendments:

From 1 July 2013 the eligibility criteria for special rate disability pension under the [MRCA] will be expanded to include certain persons who are not currently eligible because the person converted their incapacity compensation payments to a lump sum or because the incapacity payment is reduced to nil because it is fully offset by Commonwealth

superannuation.

This measure will also result in the person being entitled to additional benefits that are associated with eligibility for special rate disability pension, including a gold card, education assistance for eligible young persons and a MRCA supplement.46

2.34 The DVA submission provided further background information:

The Government agreed that a person who otherwise meets the eligibility criteria of subsection 199(1), but who is not receiving incapacity compensation because the person either received a lump sum incapacity compensation payment or their incapacity compensation is offset to nil as a result of Commonwealth superannuation being offset dollar for dollar, should be eligible for SRDP.

This will mean that, in relation to a person who converted their incapacity compensation to a lump sum and chooses to receive SRDP in lieu of incapacity payments, that part or all of the lump sum payment will need to be repaid as a person cannot be entitled to SRDP and incapacity compensation for the same injury or disease at the same time.47

2.35 The expanded criteria will include 'a person who would otherwise meet the criteria in section 199 of the [MRCA] except for the person having received a lump sum incapacity payment under section 138 of the [MRCA] or the person is receiving a

43 DVA, Review of Military Compensation Arrangements, Volume 2, February 2011, p. 143.

44 Government response, p. 34.

45 EM, p. 26.

46 Senate Hansard, 20 March 2013, p. 17.

47 DVA, Submission 5, Attachment B, pp. 10-11.

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nil rate of incapacity payment because the amount of the incapacity payment is fully offset by Commonwealth superannuation'.48

2.36 Mr Greg Isolani, KCI Lawyers, agreed that allowing veterans who otherwise satisfy the SRDP criteria to receive the benefit notwithstanding that they are receiving weekly payments. However he disagreed that there should be 'offsetting' of a ComSuper pension:

With respect to offsetting 'lump sum payments', from the SRDP this misconstrues the nature of a lump sum payment which is clearly for pain, suffering, lifestyle effects and the permanent effects of an injury or disease

upon a person's body part, organ or psychiatric state. Therefore it has no relevance or comparison to the SRDP payment which is for loss of earnings.49

Schedule 7—Superannuation 2.37 The EM states that the amendments contained in Schedule 7 will 'make changes to certain superannuation provisions so that they apply equally to both serving and former members and to amend the definition of "Commonwealth superannuation scheme"'.50 In his Second Reading Speech, the Minister described these as '[t]echnical amendments' to the definition of Commonwealth superannuation scheme under the MRCA 'to exclude contributions made by a licences corporation and to include Commonwealth contributions into retirement savings accounts'.51

2.38 The Government's response to the Review noted that this 'will ensure that relevant Commonwealth funded superannuation can be offset against incapacity payments and [Special Rate Disability Pension] so that the Government is not paying two income sources to the one person'.52 The DVA submission noted that it is 'Government policy that duplicate income maintenance payments are not to be made by the Commonwealth to an individual through both superannuation and compensation schemes'. It also highlighted that '[a]s it is possible for current serving members to be in receipt of both Commonwealth superannuation and an incapacity payment under the MRCA there are circumstances where offsetting does not take place currently under the MRCA'.53

2.39 While broadly supportive of the other amendments of the bill, the Defence Force Welfare Association expressed a 'major reservation' in relation to the treatment of superannuation. It disputed the characterisation in the Government's response of military superannuation as 'income maintenance' and did not support the acceptance of

48 EM, p. 26.

49 Submission 10, p. 6.

50 EM, p. 29.

51 Senate Hansard, 20 March 2013, p. 17.

52 Government response, p. 20.

53 DVA, Submission 5, Attachment B, p. 12.

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recommendation 12.1 of the Review.54 This recommendation was that '[t]he offset of incapacity payments and the [Special Rate Disability Pension] by the Commonwealth-funded superannuation received by the member should continue'.55 In the view of the Defence Force Welfare Association, military superannuation should have the character of retirement pay, and proposed amendments to the bill which would have the effect of insulating retirement pay from its current offsetting provisions.56

2.40 The Australian Peacekeeper and Peacemaker Veterans' Association (APPVA) also raised concerns regarding the offsetting of the Special Rate Disability Pension:

[I]t is wrong for the Government to penalise those members on [Special Rate Disability Pension], in comparison to those who have Special Rate under the VEA. Those members have paid for their COMSUPER over the period of their service. It should not be used to reduce the compensation payment from 100% of the General Rate to the Special Rate by 60 cents in every COMSUPER dollar.57

2.41 The APPVA described the offsetting of the Special Rate Disability Pension for veterans in receipt of ComSuper as a 'double-dip for the Government against the Veteran' and recommended it be removed.58

2.42 Slater and Gordon Lawyers also recommended the committee consider amendments to the bill 'that would safeguard superannuation (retirement payments) from offsetting provisions':

We note that the Bill does not address the current practice of offsetting the Commonwealth contribution to military superannuation (retirement pay) against payments for incapacity, especially in relation to the SRDP. This is disappointing in light of the Government's overall commitment to encouraging the preservation of retirement incomes. We believe that superannuation should be protected and not treated as pre-retirement income maintenance.59

2.43 Similarly, Mr Greg Isolani, KCI Lawyers, considered that there was 'confusion' in DVA's treatment of a superannuation payment as the same as an income support payments under the MRCA. He also questioned the differential treatment of Commonwealth superannuation:

[A] person who is discharged, may work in a civilian job and then medically retires under an Industry or State based superannuation scheme and receives a pension or lump sum under that scheme does NOT have that taken into account by DVA to reduce their incapacity payments under the MRCA. Clearly it is recognised that this type of Super i.e. non

54 Submission 4, p. 4.

55 Government response, p. 20.

56 Submission 4, p. 4.

57 Submission 3, p. 4.

58 Submission 3, p. 5.

59 Submission 9, p. 2.

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Commonwealth is not 'double dipping' when receiving both that payment and MRCA incapacity payments.60

2.44 In response to these concerns, DVA stated that this issue was

'comprehensively addressed' in Chapter 12 of the Review's report and confirmed that the 'superannuation offsetting provisions in the MRCA reflect broader Australian Government policy that was established in the SRCA, that the Australian Government should not pay two income sources to the same person'.61 It noted:

Only the Commonwealth-funded portion of superannuation payments are offset against incapacity payments and the Special Rate Disability Pension. The individual's own contributions are excluded from the offsetting arrangements. The policy also excludes from the offsetting arrangements all non-Commonwealth superannuation payments including those paid by

State Governments or private funds.

These provisions ensure that there are consistent outcomes between those receiving similar benefits under the MRCA and the SRCA.62

Schedule 8—Remittal power of Veterans' Review Board 2.45 The DVA submission notes that one of the pathways for the review of decisions made under the MRCA is via the Veterans' Review Board (VRB). The VRB is an independent tribunal with jurisdiction to review a claim for liability or compensation under the MRCA which extends to making whatever determination the Military Rehabilitation and Compensation Commission (MRCC) could have made.63

2.46 The DVA submission also highlighted the issue that the amendments in Schedule 8 are intended to remedy:

Section 325 of the MRCA provides that a needs assessment must be undertaken before the determination of a claim for compensation. In the circumstances where the MRCC has accepted liability for the injury or disease, and has conducted the needs assessment, the information would be available to the VRB.

However, where liability for the injury or disease was rejected by the MRCC, but subsequently accepted by the VRB, the information required to determine the claimants entitlements under the MRCA (compensation) would not be available to the VRB as the MRCC would not have conducted a needs assessment…

Where liability for the injury or disease (and consequently any concurrent claim for compensation) was rejected by the MRCC, but subsequently accepted by the VRB, the VRB currently does not have the power to remit a matter to the MRCC to conduct a needs assessment and determine the person's compensation entitlements under the MRCA. Instead, the VRB

60 Submission 10, p. 6 (emphasis in original).

61 DVA, answers to question on notice, p. 4.

62 DVA, answers to question on notice, p. 4.

63 Submission 5, Attachment B, p. 14.

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must adjourn the hearing upon accepting liability for the injury of disease, request the MRCC to conduct an investigation and provide a report to the VRB in respect of the relevant matters, such as needs assessment, rehabilitation and compensation.64

2.47 The amendments in Schedule 8 will 'provide the Veterans' Review Board with an explicit power to remit a matter to the [Military Rehabilitation and Compensation Commission] (MRCC) for needs assessment and compensation'.65 The EM to the bill notes that the amendments will enable the Veterans' Review Board, where it has accepted liability for the injury or disease that was initially rejected by the MRCC, to remit the matter to the MRCC to conduct the needs assessment and subsequent investigations and determine compensation. The EM characterises this change as a 'more effective process'.66 In accepting the Review's recommendation on this subject, the Government's response pointed out this will 'overcome the current situation where the VRB has to adjourn a case to ask a delegate of the MRCC to conduct investigations and relay the evidence to the VRB'.67

2.48 The Returned and Services League of Australia (RSL) was largely satisfied with the provisions of the bill except for a 'small exception':

The small exception concerns the use of one word in Schedule 8: Remittal power of Veterans' Review Board. At section 353A (1), the wording '...the Board may require the Commission to reconsider the claim, to the extent it relates to paragraph 319(1)(d)' is ambiguous and could lead to uncertainty.68

2.49 In relation to this point, the RSL recommended that the word 'may' be replaced by 'shall'. It argued 'the use of the word "may" in Schedule 8 does not accurately reflect the implied intention of either the EM or the recommendations of the Review'.69

2.50 However, DVA did not agree that the wording in new subsection 353A(1) was 'ambiguous and could lead to uncertainty'. It noted that the proposed wording aligns with the intent of the Review's recommendations and that the Board's remittal power was intended to be discretionary. Further:

The Principal Member of the Veterans' Review Board has advised that there would be very limited circumstances in which a matter would not be sent back to the Department i.e. only if there is sufficient information to make a determination on the file and the Board is pressed by the applicant to make a decision. It would be more usual to return the matter to the Department.

64 Submission 5, Attachment B, p. 14.

65 EM, p. 37.

66 EM, p. 38.

67 Government response, p. 25.

68 Submission 2, p. 1.

69 Submission 2, p. 1.

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The preference of the Principal Member is for this power to be discretionary.70

2.51 Slater and Gordon Lawyers observed that it has 'previously submitted that [having] two appeal paths creates unsatisfactory outcomes and have raised particular concerns in relation to the VRB producing outcomes that are less beneficial to claimants'. In this context, it was disappointed that the bill increased the VRB's powers.71

Schedule 9—Membership of the Military Rehabilitation and Compensation Commission 2.52 Under the amendments in Schedule 9 'the membership of the Military

Rehabilitation and Compensation Commission (MRCC) will be increased by an additional member, to be nominated by the Minister for Defence'.72 The EM to the bill notes that currently the membership of the MRCC is provided under section 364 of the MRCA. Membership of the MRCC consists of 'the three members of the Repatriation Commission, a member nominated by the Minister administering the Safety, Rehabilitation and Compensation Act, and a member nominated by the Minister for Defence'.73

2.53 The amendments reflect the recommendation of the Review that:

The Government consider expanding the membership of the MRCC by including a second member nominated by the Minister for Defence from the Department of Defence or the ADF, given the advantages this would bring for both Defence and the MRCC, especially in facilitating improvements in information sharing between DVA and Defence.74

2.54 The DVA submission also commented on the rationale for the amendment:

Given the breadth and complexity of the [occupational, health and safety] and compensation issues facing the ADF, it was proposed that an additional Defence member be appointed to the MRCC as the second member nominated by the Minister for Defence from the Department of Defence or the ADF. The Government agreed that such an appointment would be of

significant benefit to both the MRCC and Defence as it would, for example, facilitate the improvements necessary to allow DVA and Defence to share information more effectively.75

70 DVA, answers to written questions on notice, p. 4.

71 Submission 9, p. 3.

72 Senate Hansard, 20 March 2013, p. 17.

73 EM, p. 40.

74 DVA, Review of Military Compensation Arrangements, Volume 2, February 2011, p. 256.

75 Submission 5, Attachment B, p. 16.

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Schedule 10—Aggravation of or material contribution to war-caused or defence-caused injury or disease 2.55 The amendments in Schedule 10 will 'require all claims for conditions accepted under the [VEA] and aggravated by defence service after 1 July 2004 to be determined under the [VEA], rather than offering a choice between the [VEA] and the [MRCA], which is currently the case'.76

2.56 The EM to the bill notes that a claim for the aggravation of an injury or disease accepted under the VEA, where the aggravation occurred as a result of service rendered on or after 1 July 2004, requires the claimant to make a choice to make an

application under the VEA scheme or make a claim under the MRCA (also referred to as a 'section 12 election'). It states that this election process is 'complex and can result in confused and anxious claimants and is administratively burdensome for the Department'. It notes further that since the commencement of the MRCA most claimants have elected to proceed under the VEA rather than claim under the MRCA.77

2.57 The DVA submission outlined that this issue had developed from measures intended to ensure that, at the time the MRCA was enacted, it would not interfere with the compensation entitlements of VEA beneficiaries. It also noted that a number of other issues relating to the difficulties in the administration of claimant elections were also highlighted during the Review.78

2.58 In accepting the Review's recommendation on this subject, the Government response also stated that '[i]mplementation of this recommendation will simplify the claims process for a person with an aggravation (by service after 1 July 2004) of a condition already accepted under the VEA'.79

2.59 However, Slater and Gordon Lawyers characterised removing the entitlement to claim under the MRCA, simply because an earlier claim was made under the VEA, as 'unjust':

An earlier VEA claim may have been made prior to enactment of MRCA, so it cannot be suggested that the claimant made a choice between the Acts when submitting an initial claim. The following inequities and concerns result from this amendment:

- for an aggravated injury after [1 July 2004] (and previously accepted under VEA) the claimant is limited to the pension options available under VEA and cannot claim a lump sum under MRCA; and

76 EM, p. 41.

77 EM, p. 41.

78 Submission 5, Attachment B, p. 17.

79 Government response, p. 28.

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- the election may have been confusing for claimants, but this was most likely due to poor written advice and poorly drafted letters from the Department to claimants and lack of understanding of the MRCA.80

2.60 Similarly, Mr Greg Isolani, KCI Lawyers, recommended the choice between the VEA and MRCA should 'not be taken away'. He highlighted the benefits for veterans in being able to make an 'informed decision' in relation to this issue:

Currently, I provide this advice to Veterans and it is extremely beneficial taking into account the individual's particular needs, age, likelihood of incapacity occurring later in their service life i.e. that it may be more beneficial that they remain under the VEA as opposed to a younger Veteran whereby rehabilitation, a higher rate of incapacity payment and a lump sum/periodic payment may be more attractive under the MRCA.81

2.61 In response to these issues DVA outlined the assessments and benefits under the MRCA and VEA, and acknowledged that '[t]here will be some claimants who would have been better off having their claim determined under the MRCA rather than the VEA'.82 However, DVA also highlighted the complexities behind the rationale for the amendment and the consideration of this subject by the Review:

[I]t is not possible, at the time the choice must be made, to determine which package will offer the better value to a particular claimant. This is because many of the factors that will impact on access to the various benefits will not be known for many years, some not until after the claimant's death. DVA can only provide information on the benefits that would be available if certain circumstances arise. Consequently, the choice must ultimately be a subjective choice by the claimant, based on their assessment of the likelihood of circumstances arising that will enable them to access benefits under each of the Acts.

The Review noted that there is merit in providing flexibility for claimants, but given the confusion and anxiety caused to clients and the administrative burden for DVA. [The Review] took the view that the provisions should be simplified, and that aggravations of a VEA condition should be compensated under the VEA. This approach will maximise claimants' VEA entitlements. The Government accepted this view and the Bill will implement the recommendation.83

2.62 Responding to the statements made regarding deficient advice to claimants, DVA emphasised the complexity of providing advice to claimants in relation to the choice between the VEA and MRCA in this situation. It stated:

While it would appear a simple matter to advise a claimant of the different benefits available if they were to be compensated under one Act or the other. In reality, however, this is problematic.

80 Submission 9, p. 4.

81 Submission 10, p. 7.

82 DVA, answers to written questions on notice, pp. 4-5.

83 DVA, answers to written questions on notice, p. 5.

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In terms of the actual choice, a decision-maker must provide not just information on the benefits available under two very different Acts, but also decide upon the date of aggravation and make a claimant aware of the

implications of their irrevocable decision. Effectively, a decision-maker is required to assess the likelihood that liability will be accepted under the MRCA, the likely incapacity that would arise under each Act, the range of benefits that would result and convey this to the client. Claimants then have to make a choice without any certainty of the outcome.84

Schedule 11—Treatment for certain SRCA injuries 2.63 The amendments in Schedule 11 provide for Repatriation Health Cards—For Specific Conditions (White Cards) to be issued to Part XI defence-related claimants under the [SRCA] (SRCA members). The DVA submission provided some further background to these amendments:

Under both the [MRCA] and the [VEA], the MRCC and Repatriation Commission respectively have established arrangements with health care providers, hospitals and other institutions for the provision of treatment to veterans, former members and their dependants. This arrangement includes issuing Treatment Cards, known as Gold and White Cards, to clients for payment purposes.85

2.64 The EM to the bill notes that the 'initiative is intended to achieve consistency in treatment arrangements for all former Defence Force members. SRCA members with an injury accepted under the [SRCA] as being related to service (SRCA injury), will be entitled to treatment for a SRCA injury under either the [MRCA] or the [VEA] in accordance with the arrangements established under those Acts'.86

Financial impact

2.65 The Financial Impact Statement for the bill indicates that the amendments in Schedule 11 are the most significant in terms of financial impact. It lists the impact for the year 2012-13 as $3.0 million, but the three subsequent years have negative financial impacts (-$3.4 million, -$10.1 million and -$11.7 million).87 The DVA submission stated that:

An additional $39.6 million of expenditure over four years will be offset by the initiative to issue Repatriation Health Cards to SRCA clients with long term treatment needs, which will generate savings of $22.2 million over four years.88

2.66 In an answer to a question on notice, DVA provided additional information on the financial impacts of the amendments in Schedule 11:

84 DVA, answers to written questions on notice, p. 6.

85 Submission 5, Attachment B, p. 19.

86 EM, p. 47.

87 EM, p. vi.

88 Submission 5, p. 2.

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The amendments in Schedule 11 provide for SRCA clients whose condition is long term to access health care treatment through DVA's longstanding treatment card arrangements, rather than being required to seek prior authority for treatment and reimbursement of treatment expenses. This change provides both health providers and DVA clients with a more streamlined approach to addressing long term health care needs.

The reduction in expenditures occurs because the fees and charges sought by providers under the former reimbursement arrangements have exceeded those applying to services provided through the treatment card arrangements. Treatment card arrangements are widely accepted by doctors and other health professionals providing services to the majority of DVA clients.89

2.67 Mr Greg Isolani, KCI Lawyers welcomed the extension of the treatment card to SRCA recipients, noting that it will 'reduce the delays and uncertainty experienced by many SRCA recipients who often complain of delays to be reimbursed for medical treatment'. However, he cautioned that DVA needs to be aware of the number of medical providers who do not accept the White or Gold card and prefer to be paid at the time of the consultation.90

2.68 Mr Mark Raison, an advocate with the Royal Australian Air Force Association Queensland Branch and a pension officer with the Pine Rivers RSL Sub-Branch, also raised concerns regards to 'the issuing of white cards to ex-military members that have medical conditions accepted for ongoing treatment, under [the SRCA]'. He requested that 'if a person is currently covered under SRCA [they] be permitted to keep their current entitlement to have supplementary medications prescribed to them and that they pay the recommended co-payment of $5.80'.91

Privacy issues

2.69 Item 15 of Schedule 11 inserts new section 151A after existing section 151 into the SRCA. The EM to the bill notes:

New subsection 151A provides that the MRCC, or a staff member assisting the MRCC, may provide any information obtained in the performance of duties under [the SRCA] to the persons specified in paragraphs 151A (a) to (e) for the purposes of the applicable Department or agency. The persons specified in paragraphs 151A(a) to (e) are:

- the Secretary of the Department administered by the Minister who administers the National Health Act 1953;

- the Secretary of the Department administered by the Minister who administers the Aged Care Act 1997;

- the Secretary of the Department administered by the Minister who administers the Human Services (Centrelink) Act 1997;

89 DVA, answers to written questions on notice, p. 7.

90 Submission 10, p. 8.

91 Submission 7, pp. 1-2 (emphasis in original).

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- the Chief Executive Centrelink (within the meaning of the Human Services (Centrelink) Act 1997);

- the Chief Executive Medicare (within the meaning of the Human Services (Medicare) Act 1973).92

2.70 The Office of the Australian Information Commissioner (OAIC) raised concerns with these amendments in Schedule 11. It noted that 'the effect of this provision may be to authorise disclosures of personal information that would not otherwise be permitted under the Privacy Act'.93 In the OAIC submission, Mr Timothy Pilgrim, the Privacy Commissioner stated:

I am concerned that the breath of the proposed s 151A may limit the ability of current and former ADF members to control how their personal information is handled. It is not clear why the inclusion of such a broad discretion is necessary to give effect to the intention of the amendments…

More specifically, it is not clear what personal information the MRCC may obtain through the performance of their duties and, therefore, what personal information may be disclosed under the proposed s 151A. Further, although the proposed s 151A(2) prohibits the recipient Department, Centrelink or Medicare from using or disclosing the information for purposes other than the purposes of the relevant body, the broad range of functions undertaken by those bodies and the scope of their own disclosure powers mean the extent of those purposes is unclear. As a result, it is difficult to discern what impact such uses or disclosures might have on the privacy of current and former members of the ADF.

These circumstances could also lend themselves to increasing the risk of function creep — where information collected for one purpose is used for other unrelated purposes outside the individual's expectations.94

2.71 Mr Pilgrim recommended a privacy impact assessment (PIA) of the proposed amendments be undertaken. In the absence of an PIA being undertaken, he suggested:

[Section] 151A be amended to confer a limited discretion on the MRCC to disclose personal information where it is necessary to achieve the intention of the Bill. The Committee may also wish to consider recommending that the Government outline, in the Explanatory Memorandum to the Bill, the purposes for which the MRCC can disclose personal information and limitations on the purposes for which a recipient Department, Centrelink or

Medicare can use or disclose that information. This could, for example, be achieved through limiting the further use or disclosure of that information to purposes related to the original purpose of collection.95

2.72 In relation to these privacy issues, DVA stated that new section 151A replicates a similar provision in the VEA and the MRCA and provides for the

92 EM, p. 55.

93 Submission 8, p. 2.

94 Submission 8, p. 3.

95 Submission 8, p. 4.

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exchanges of information to: support administrative arrangement for treatment cards (Medicare Australia); to check clients are not already receiving a pension supplement (Centrelink); and for the purposes of establishing eligibility for new dementia and veterans' supplements.96 Further, DVA explained that SRCA clients, like VEA and MRCA clients, would be advised of the collection, use and disclosure of information. Consequently:

As this proposed section extends DVA's existing administrative arrangements under the current treatment card system to the SRCA cohort, DVA does not consider that a privacy impact assessment is required. Appropriate use of information protocols are outlined [in] a Memorandum of Understanding (MOU) with the Department of Human Services.97

2.73 DVA also indicated that it had discussed the privacy controls in place around the use of the Repatriation Treatment Card with the OIAC and undertaken to provide an explanation on these matters to the committee.98

Schedule 12—Members 2.74 Schedule 12 contains amendments 'to define members undergoing career transition, personnel holding honorary ranks and authorised representatives of philanthropic organisations as "members" under the MRCA'.99

2.75 This was a recommendation of the Review which was accepted and 'enhanced' in the Government response. While the Review's recommendation was limited to members undergoing career transition assistance and personnel holding honorary ranks, the Government response added 'authorised representatives of philanthropic organisations, in support of the ADF' to be defined as 'members' under the MRCA. The Government response stated that this would 'provide certainty about access to rehabilitation and compensation for these defined groups who are currently given access to the MRCA via Ministerial determination'.100

Schedule 13—Treatment costs 2.76 The amendments in Schedule 13 'clarify the appropriation of costs for certain aged care services between the VEA, the Australian Participants in British Nuclear Tests (Treatment) Act 2006 and the MRCA (the Veterans' Affairs Acts) and the Aged Care Act 1997 and the Aged Care (Transitional Provisions) Act 1997 (the Aged Care Acts)'.101

2.77 The background to the amendments provided in the DVA submission stated:

96 DVA, answers to written questions on notice, p. 7.

97 DVA, answers to written questions on notice, p. 7.

98 DVA, answers to written questions on notice, p. 8.

99 EM, p. 57.

100 Government response, p. 32.

101 EM, p. 59.

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Aged care services for eligible Veterans' Affairs clients are regulated by both the Aged Care Acts and the Veterans' Affairs Acts. The Aged Care Acts provide for subsidies for aged care services generally and the Veterans' Affairs Acts provide for treatment, including aged care services, for eligible Veterans' Affairs clients. Because a person who is entitled to treatment under the Veterans' Affairs Acts may also be a person eligible for aged care services under the Aged Care Acts, arrangements had been established under the different portfolio Acts for the appropriation of costs for aged care services for eligible Veterans' Affairs clients. Under the arrangements, the Repatriation Commission or the MRCC accept financial responsibility for the amount of the subsidy for certain aged care services, where that subsidy would otherwise be payable under the Aged Care Act 1997.102

2.78 The EM to the bill also highlights that aged care services for eligible Veterans' Affairs clients are regulated by both the Aged Care Acts and the Veterans' Affairs Acts. It notes:

Proposed amendments to the Veterans' Affairs Acts will clarify and confirm that the Repatriation Commission and the MRCC may limit their financial responsibility to particular costs in relation to certain aged care services. The amendments will provide that the Treatment Principles authorised under the Veterans' Affairs Acts may specify the circumstances in which and the extent to which, the relevant Commission may accept limited financial responsibility for particular costs in relation to specified kinds of treatment.103

2.79 Mr Greg Isolani, KCI Lawyers agreed that the amendments would be beneficial for Australian Participants of the British Nuclear Tests, but described it as a 'missed opportunity' not to extend 'the range of benefits payable under the MRCA or the SRCA to include for example reasonable funeral expenses for those who die, wholly dependent benefits and lump sums for those with permanent impairments'.104

Schedule 14—Travelling expenses 2.80 The amendments in Schedule 14 'extend the entitlement for travelling expenses to the partner of certain eligible persons under certain circumstances'.105 The EM to the bill states that '[u]nder the existing legislation, there is no provision to enable the payment of travelling expenses for the partner of an eligible person where the partner is required to travel to participate in the eligible person's treatment'. This amendment does not appear to arise from the recommendations of the Review.

2.81 In relation to these amendments the DVA submission outlined:

102 Submission 5, Attachment B, p. 22.

103 EM, p. 59.

104 Submission 10, p. 9.

105 EM, p. 63.

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Part V of the [VEA] provides for treatment for eligible persons, including medical, allied health and hospital treatment. Section 110 of the [VEA] provides for eligible persons to be paid travelling expenses for travel to obtain treatment under Part V. Where necessary, it further provides for travelling expenses for an attendant to accompany the eligible person.

Section 112 of the [VEA] specifies a time limit for claiming travelling expenses.

A small number of post-traumatic stress disorder treatment programs require the partner of the veteran or member (the eligible person) to participate in the veteran's or member's treatment.106

Schedule 15—Payments into accounts 2.82 The amendments in Schedule 15 will 'clarify and streamline the

administrative arrangements for the payment of pensions, compensation and other pecuniary benefits under the Veterans' Entitlements Act and the MRCA into bank accounts'.107 The EM to the bill notes that the amendments will mean that 'if a person is receiving a payment from the Department, the person does not need to provide the Department with bank account details each time the person receives a new type of payment'.108 The DVA submission stated that the amendments in Schedule 15 'will clarify the administrative arrangements for the nomination of bank accounts for payments under the [VEA] and the [MRCA] and will minimise the associated administrative obligations of veterans, members and their dependants'.109

2.83 Mr Pilgrim, the Australian Privacy Commissioner, identified that the amendments in Schedule 15 also had privacy implications. However, he considered the handling of personal information permitted by the provisions in Schedule 15 is 'more closely aligned with the protections afforded to that information by the Privacy Act'.110

Schedule 16—Other amendments 2.84 The amendments in Schedule 16 include:

• 'a minor and consequential amendment to the Social Security Act that clarifies which payments made under the [MRCA] are excluded income for the purposes of the Social Security Act'.111

• 'amendments to the Veterans' Entitlements Act to provide for the recovery from payments made under that Act of overpayments made under the [MRCA]'.112

106 Submission 5, Attachment B, p. 22.

107 EM, p. 65.

108 EM, p. 65.

109 Submission 5, Attachment B, p. 24.

110 Submission 8, p. 1.

111 EM, p. 69.

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Commencement 2.85 Clause 2 provides that Schedules 1 to 8, 10 and 12 commence on 1 July 2013. Schedule 11 dealing with treatment for certain SRCA injuries commences on 10 December 2013. Schedules 9, 14, 15 and 16 commence on Royal Assent, while Schedule 13 commence on the 28th day after Royal Assent.

Other issues 2.86 In addition to the specific amendments of the schedules of the bill, a number of other broader issues relating to the legislation and military compensation arrangements were raised in submissions.

Support for reform

2.87 In broad terms, several of the submissions received by the committee supported the amendments, or the majority of the amendments, made by the bill.113 Many organisations had previously contributed to the Review of Military Compensation Arrangement and some been involved in later consultation conducted by DVA in the development of the draft legislation. For example, the Royal Australian Air Force Association noted that it and representatives of the Ex-Service Organisation roundtable had been provided the opportunity to participate in the finalisation of the draft bill.114 Similarly, the Defence Force Welfare Association, with one 'major reservation' (in relation to the treatment of superannuation), supported the legislative changes in the bill. However, it did note that even as amended the MRCA was not 'free of defect' and contended there were still improvements which could be made.115

2.88 DVA highlighted that extensive consultation had been undertaken with veteran and Defence communities during the Review and the development of the bill:

On commencement of the Review, submissions were invited and 52 in scope submissions were received from individuals, ex-service and other organisations. The Steering Committee appointed to undertake the Review visited twelve Australian Defence Force bases and held nine public meetings to ensure that all relevant issues were identified for its consideration. The Committee also met five times with a small group of four ex-service organisation representatives nominated by the Ex-service Organisation Round Table to represent their views. Following release of the report by the Minister for Veterans' Affairs a further 43 submissions were received, providing feedback on the recommendations. Major ex-service organisations were briefed in the lead up to the Government's response in

112 EM, p. 69.

113 For example, Returned and Services League of Australia, Submission 2, p. 1.

114 Submission 1, p. 1.

115 Submission 4, p. 4.

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the 2012 Budget and again before the introduction of this Bill into Parliament.116

Conduct of the Review and consultation

2.89 Concerns were also expressed regarding the Review of Military Compensation Arrangements and the process of consultation and consideration of the recommendations of its recommendations.

2.90 The Australian Peacekeeper & Peacemaker Veterans' Association (APPVA) held a number of concerns regarding the conduct of the Review. These concerns focused on the independence of the Review Committee. In particular, it noted that the Review Committee was chaired by the Secretary of DVA and that 'the Review was conducted by DVA, reviewed by DVA, recommendations made by DVA and finally the Government response written by DVA'.117 Consequently, APPVA did not believe that 'the Review was conducted in an impartial manner and failed to address some [k]ey areas that have concerned current and ex-serving members since the enactment of the MRCA'.118 In relation to the impartiality of the Review, Mr Greg Isolani, KCI Lawyers, also pointed out the Review 'could have included at least some Ex-Service Organisation representatives to balance out the composition of the Review team'.119

2.91 Mr Isolani also questioned the timing of a Senate inquiry into the proposed changes to the MRCA.

[I]t would in my view have been of greater benefit for the stakeholders concerned for a Senate inquiry into all the recommendations including those which were rejected by the government as opposed to those that have been accepted and now proposed in the amendments

The issues that could have been raised before the Senate Committee at that point i.e. post May 2012 would also have included what appears to be a substantial focus on the 'cost' of proposed changes that was the focus of the Review team as opposed to the 'value' of compensating Veterans, their families and their dependents for rendering military service in our name.120

2.92 DVA made the point that the Australian Government undertook to examine the military compensation system in response to requests from the veteran and ex-service community. Further:

Steering Committee members were chosen on the basis of their expertise to consider a wide range of rehabilitation and compensation issues, the whole of government implications, and to provide expertise from their Departments. The Steering Committee also included an independent

116 Submission 5, p. 2.

117 Submission 3, p. 2.

118 Submission 3, p. 2.

119 Submission 10, p. 2.

120 Submission 10, p. 2.

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member, Mr Peter Sutherland, a Visiting Fellow at the Australian National University College of Law.

There was extensive consultation with the veteran and defence community during the Review. Sixty eight submissions were received, 52 of which raised matters within the scope of the Review. In addition, the Committee visited ADF bases and held public meetings in all capital cities and Townsville. Two members of the Prime Ministerial Advisory Council attended most meetings of the Steering Committee as observers and the Committee met with representatives nominated by the Ex-service Organisation Round Table on five occasions. The Committee took those views into account in formulating its report.

The Government consulted on the report with the veteran and defence community before it formulated its response, and feedback was received from 43 ex-service organisations, other organisations and individuals.121

Service differential

2.93 The Review observed that 'the MRCA continues the tradition of recognising members injured on overseas service by providing higher permanent impairment compensation payments for injuries and diseases related to warlike and non-warlike service compared to peacetime service (known as the compensation differential)'. Despite differences of opinion between members of the Review regarding where the service differential should apply, the Review recommended that 'the existing permanent impairment compensation differential for warlike and non-warlike service (or operational service) as opposed to peacetime service be maintained'.122

2.94 The Government response accepted the Review's recommendation regarding the maintenance of the service differential noting that 'it confirms its gratitude and recognition of the nature of warlike and non-warlike service (formerly known as operational service) where personnel are intentionally exposed to harm from belligerent enemy or dissident forces'.123

2.95 Slater and Gordon Lawyers opposed the service differential:

We believe that the compensation scheme should treat people similarly, regardless of where and when they served. Prior to the enactment of the MRCA, there was no service differentiation for the purpose of permanent impairment benefit rates under the VEA or SRCA.

We also believe that there should not be a differentiation in relation to compensation following loss of life. We contend that needs of families and dependants following the death of an ADF member are not altered by the location or type of service that resulted in a tragic loss of life.124

2.96 The APPVA also opposed the service differential:

121 DVA, answers to written questions on notice, p. 8.

122 DVA, Review of Military Compensation Arrangements, Volume 2, February 2011, p. 86.

123 Government response, p. 13.

124 Submission 9, p. 2.

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The Service Differential has been a significant issue for current and ex-serving members of the ADF. The Government has failed to recognise the equality of Permanent Impairment and like injuries/illness, regardless of the area served. The Government refused to accept that prior to the enactment of MRCA, that there was no such Service Differential under the VEA or SRCA for Permanent Impairment.

Whilst the Government supported the Review Committee's recommendations to retain the status quo for the Service Differential, it failed to recognise the significant and substantial allowances that are paid to ADF members, along with veteran entitlements to those who serve on Warlike service.125

Time frames

2.97 Slater and Gordon Lawyers highlighted their concerns that DVA 'all too often fails to meet voluntary timeframes for decision making' and that this 'leads to delays in the resolution of claims and creates unnecessary stress and hardship for injured Veterans'.126 It recommended that time frames for making decisions should be included in the legislation in line with other compensation schemes:

Despite the best will of the many people involved, and despite the Service Charter, claims, correspondence and even whole files continue to be lost in the system, causing delay and frustration for injured and ill

personnel…[T]he system would be improved for claimants if time frames were inserted in the MRCA and the SRCA modelled on those in the Seafarers Act.127

2.98 Slater and Gordon Lawyers also drew the committee's attention to the recommendations of the Hank Review of the SRCA. The Hank Review recommended that 'the [SRCA] be amended to include statutory timeframes for the determination of claims and that, on failure to meet those timeframes, the claim be deemed rejected'.128 Slater and Gordon Lawyers argued:

We note that the Comcare scheme deals with a number of public sector employers and self-insured licensees. We submit that given all veterans' and military compensation claims are handled by the one agency, namely the Department of Veterans' Affairs, it should be straightforward for a single agency to adhere to mandatory time frames. Further, if the scheme is being well administered, the measure should save administrative and legal costs as disputes in relation to claims will be resolved more efficiently as a result of timely decision making.129

125 Submission 3, pp. 2-3.

126 Submission 9A, p. 1.

127 Submission 9, pp. 1-2.

128 Mr Peter Hank QC, 'Safety, Rehabilitation and Compensation Review', Report, February 2013, p. 163.

129 Submission 9A, p. 1.

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2.99 The Review report considered delays in the processing and review of claims for military compensation, and made a number of recommendations in this area (which were accepted by the Government response), but did not recommend establishing time frames in legislation.130 Nonetheless it noted, at that time, that legislation to amend the SRCA and include provisions for time limits within which Comcare claims and reconsideration must be determined (to be prescribed by regulation), would be considered by the Parliament in the future. The Review also considered it was 'reasonable for similar statutory reporting provisions to be built into the MRCA requirements'.131

130 Government response, pp. 22-24.

131 DVA, Review of Military Compensation Arrangements, Volume 2, February 2011, p. 218.

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Chapter 3

Committee view and recommendation Committee view 3.1 In the view of the committee, the bill achieves its purpose in implementing aspects of the Government's response to the recommendations of the Review of Military Compensation Arrangements and these amendments will result in positive changes for those who benefit from military compensation arrangements. Nonetheless, the committee acknowledges the concerns raised by submissions to the inquiry regarding other aspects of Australia's military compensation arrangements and recognises that the amendments made by the bill will not mean that these arrangements are 'free of defect'.1

3.2 A large number of amendments and several other issues relating to military compensation arrangements were raised with the committee. The committee wishes to comment on some specific issues-in particular:

 consultation processes and Review membership;

 offsetting of Commonwealth superannuation;

 privacy issues;

 the definition of 'financial advisor'; and

 time frames for processing and reviewing applications.

Consultation and Review membership

3.3 Concerns were raised by submitters in relation to the independence of the Review of Military Compensation Arrangements. The committee does not question the high quality of the work completed by the Review committee, which is evident in the two volumes of the Review's report. However, in the view of the committee, the appointment of only one member who was not a member of the public service to the Review committee unnecessarily opened the findings of the Review to question.

3.4 The committee considers that a high level of consultation has been undertaken by DVA in relation to the development of the bill, particularly with ex-service organisations and veteran communities. In the committee's view, the Australian Government should in future include representatives of ex-service organisations, or other appropriately qualified persons from outside of the public service, in any review or inquiry into military compensation arrangements. Further, DVA should continue to consult closely with these organisations in the development of any legislation amending military compensation arrangements.

Offsetting of Commonwealth superannuation

3.5 The committee recognises the ongoing concerns of some members of the veteran community and others in relation to offsetting Commonwealth superannuation

1 Defence Force Welfare Association, Submission 4, p. 4.

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in relation to some compensation. This issue received significant consideration as part of the Review's report. The committee notes that it reflects a long-standing policy that 'the Australian Government should not pay two income sources to the same person'.2 In the view of the committee the case has not been made for a change in policy at this time.

Privacy issues

3.6 Respecting the privacy of serving members of the ADF and veterans should be an important consideration in the framework of military compensation arrangements. The committee notes that DVA complies with the Privacy Act 1988 in the collection, storage, use and disclosure of personal information in its possession. The committee encourages DVA to continue its ongoing discussions with OIAC to ensure that veterans and others are fully informed concerning the ways their personal information will be used by government agencies.

Definition of 'financial advisor'

3.7 The committee notes that on 15 May 2013 the Parliamentary Joint Committee on Corporations and Financial Services tabled its report into the Corporations Amendment (Simple Corporate Bonds and Other Measures) Bill 2013 (Corporations Amendment Bill). The Joint Committee recommended the proposed legislation be passed.3

3.8 In answers to questions on notice, DVA noted that if the Corporations Amendment Bill were passed 'a consequent amendment to the MRCA could also be considered at that time'.4 The view of the committee is that, should the Corporations Amendment Bill be passed and receive Royal Assent, the Australian Government should move quickly to introduce consequential amendments to the MRCA to ensure there is legislative consistency in relation to the use of the terms 'financial advisor' and 'financial planner'.

Time frames

3.9 The committee notes the Review's consideration of the delays in the processing and review of applications by DVA. It is clear to the committee that long delays in the processing of applications can be detrimental to claimants—resulting in periods of stress and uncertainty. Potentially, the inclusion of legislative time frames for the assessment of applications could result in more timely outcomes for veterans and others entitled to seek assistance. However, this is not the only measure which could achieve this outcome.

3.10 The committee notes that the Minister recently released a statement which addressed concerns raised regarding the processing of claims by DVA:

2 DVA, answers to written questions on notice, p. 3.

3 Parliamentary Joint Committee on Corporations and Financial Services, Corporations Amendment (Simple Corporate Bonds and Other Measures) Bill 2013, 15 May 2013, p. 54.

4 DVA, answers to written questions on notice, p. 3.

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The 2013-14 Budget contains funding of $1.7m over four years to improve processing for compensation claims, with a particular focus on the timeliness of claims for mental health conditions.

This additional funding to improve processing times will mitigate the risk of the claims process exacerbating a client's mental health condition. It will also help to provide access to financial support as soon as possible.

DVA is addressing the times taken to process claims through a range of measures, including:

- applying streamlining processes;

- further training and guidance for staff;

- the redistribution of claims across locations;

- the prioritisation of cases;

- the redevelopment of Information, Communication and Technology tools; and

- improved access to information from the Department of Defence.5

3.11 During the inquiry, DVA demonstrated the difficulties and complexity involved in assessing some applications for compensation. Nonetheless, in the view of the committee, there is further scope for DVA to engage with ex-service organisations and veteran communities to identify areas where delays could be mitigated in the processing and review of applications. Performance measures for DVA's processing and review of applications should also continue to be closely monitored by the Australian Government. If no improvement is evident in the times for processing and reviewing applications, further consideration should be given to legislative change.

Recommendation 1

The committee recommends that the Senate pass the Veterans' Affairs Legislation Amendment (Military Compensation Review and Other Measures) Bill 2013.

Senator the Hon Ursula Stephens Chair

5 The Hon Warren Snowdon MP, Minister for Veterans' Affairs, 'Statement on ABC 7.30 Report mental health story', Media Release, 6 June 2013, http://minister.dva.gov.au/media_releases/2013/jun/va052.htm (accessed on 7 June 2013).

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Appendix 1

Public submissions

1 Royal Australian Air Force Association

2 Returned and Services League of Australia

3 Australian Peacekeeper and Peacemaker Veterans' Association

4 Defence Force Welfare Association

5 Department of Veterans' Affairs

6 Financial Planning Association of Australia

7 Mr Mark Raison

8 Office of the Australian Information Commissioner

9 Slater and Gordon Lawyers

9A Supplementary submission

10 KCI Lawyers

11 Mr John Goldsworthy

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Appendix 2

Answers to written questions on notice

1 Department of Veterans' Affairs, answers to written questions on notice

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The Senate

Legal and Constitutional Affairs

Legislation Committee

Courts and Tribunals Legislation Amendment (Administration) Bill 2012 [Provisions]

February 2013

77

© Commonwealth of Australia

ISBN: 978-1-74229-756-9

This document was produced by the Senate Legal and Constitutional Affairs Committee secretariat and printed by the Senate Printing Unit, Department of the Senate, Parliament House, Canberra.

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iii

MEMBERS OF THE COMMITTEE

Members

Senator Patricia Crossin, Chair, ALP, NT

Senator Gary Humphries, Deputy Chair, LP, ACT

Senator Sue Boyce, LP, QLD

Senator Mark Furner, ALP, QLD

Senator Louise Pratt, ALP, WA

Senator Penny Wright, AG, SA

Secretariat

Ms Julie Dennett Committee Secretary

Ms Sandra Kennedy Principal Research Officer

Ms Elise Williamson Administrative Officer

Suite S1.61 Telephone: (02) 6277 3560

Parliament House Fax: (02) 6277 5794

CANBERRA ACT 2600 Email: legcon.sen@aph.gov.au

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TABLE OF CONTENTS

MEMBERS OF THE COMMITTEE ............................................................. iii

RECOMMENDATION ................................................................................... vii

CHAPTER 1 ........................................................................................................ 1

INTRODUCTION .................................................................................................... 1

Purpose of the Bill .................................................................................................. 1

Conduct of the inquiry ............................................................................................ 2

Acknowledgement .................................................................................................. 2

Note on references .................................................................................................. 2

CHAPTER 2 ........................................................................................................ 3

KEY ISSUES ............................................................................................................. 3

Schedule 1 of the Bill - National Native Title Tribunal amendments ................... 3

Schedule 2 of the Bill - Family Court and Federal Magistrates Court amendments ............................................................................................................ 6

Committee comment .............................................................................................. 9

ADDITIONAL COMMENTS BY COALITION SENATORS ................... 11

APPENDIX 1 ..................................................................................................... 13

SUBMISSIONS RECEIVED ................................................................................. 13

APPENDIX 2 ..................................................................................................... 15

WITNESSES WHO APPEARED BEFORE THE COMMITTEE ................... 15

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RECOMMENDATION

Recommendation 1

2.30 The committee recommends that the Bill be passed.

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CHAPTER 1 INTRODUCTION

1.1 On 31 October 2012, the then Attorney-General, the Hon Nicola Roxon MP, (Attorney-General) introduced the Courts and Tribunals Legislation Amendment (Administration) Bill 2012 (Bill) into the House of Representatives.1 On 1 November 2012, the Senate referred the provisions of the Bill to the Legal and Constitutional Affairs Legislation Committee (committee) for inquiry and report by 5 February 2013.2 The reporting date was subsequently extended until 25 February 2013.3

Purpose of the Bill

1.2 The Bill proposes amendments to the Native Title Act 1993 (Native Title Act), the Family Law Act 1975 (Family Law Act), the Federal Magistrates Act 1999 (Federal Magistrates Act),4 and the Ombudsman Act 1976, which aim to improve the effectiveness and efficiency of the Family Court of Australia (Family Court), the Federal Magistrates Court of Australia (Federal Magistrates Court), the Federal Court of Australia (Federal Court) and the National Native Title Tribunal by reforming their administrative structures and processes.5

1.3 In particular, the Bill proposes amendments to:

• transfer the National Native Title Tribunal's appropriations, staff and some of its administrative functions to the Federal Court;

• reflect that the National Native Title Tribunal is no longer a statutory agency for the purposes of the Financial Management and Accountability Act 1997; and

• facilitate the merger of the administrative functions of the Family Court and the Federal Magistrates Court.6

1 The Hon Nicola Roxon MP, Attorney-General, Second Reading Speech, House of Representatives Hansard, 31 October 2012, p. 12735.

2 Journals of the Senate, No. 121-1 November 2012, pp 3235-3237.

3 Journals of the Senate, No. 123-20 November 2012, pp 3324-3325.

4 The committee notes that the Federal Circuit Court of Australia Legislation Amendment Act 2012 received Royal Assent on 28 November 2012 - Act 165 of 2012. That Act changes the name of the Federal Magistrates Court of Australia to the Federal Circuit Court of Australia from 28 May 2013 (unless proclaimed earlier), and also changes the name of the Federal Magistrates Act 1999 to the Federal Circuit Court of Australia Act 1999.

5 Second Reading Speech, House of Representatives Hansard, 31 October 2012, p. 12736.

6 EM, p. 2.

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1.4 The Bill implements recommendations of the Strategic Review of Small and Medium Agencies in the Attorney-General's Portfolio, conducted by Mr Stephen Skehill and publicly released on 8 June 2012 (Skehill Review).7

Conduct of the inquiry

1.5 The committee advertised the inquiry in The Australian on 7 November 2012, and wrote to 107 stakeholders inviting submissions by 17 December 2012. Details of the inquiry, including the Bill and associated documents, were made available on the

committee's website at www.aph.gov.au/senate_legalcon.

1.6 The committee received 10 submissions, which are listed at Appendix 1.

1.7 A public hearing was held in Canberra on 31 January 2013. A list of witnesses who gave evidence at the hearing are listed at Appendix 2.

Acknowledgement

1.8 The committee thanks those organisations and individuals who made submissions and gave evidence at the public hearing.

Note on references

1.9 References to the committee Hansard are to the proof Hansard. Page numbers may vary between the proof and the official Hansard transcript.

7 EM, p. 2.

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CHAPTER 2

KEY ISSUES

2.1 Submitters and witnesses were generally supportive of the amendments proposed by the Bill.

Schedule 1 of the Bill - National Native Title Tribunal amendments

2.2 Schedule 1 of the Bill sets out the proposed changes to the National Native Title Tribunal (NNTT). The amendments proposed in Schedule 1 were announced in the 2012-13 Federal Budget and are designed to:

• transfer the NNTT's native title claims mediation functions and resources to the Federal Court; and

• consolidate the corporate service areas of the two agencies. 1

2.3 The transfer of the NNTT's native title claims mediation functions build on previous reforms, introduced in 2009, that were made to:

• give the Federal Court greater control of native title mediation; and

• refocus the NNTT on its 'future act' 2 functions and registration role.3

2.4 Mr Warwick Soden, Registrar and Chief Executive Officer of the Federal Court of Australia, advised that the changes 'will formally transfer all of the staff of the tribunal to the Federal Court' and that the 'merging of the corporate function' will enable efficiencies.4

Providing certainty

2.5 A representative of the Attorney-General's Department (Department) explained that the amendments set out in Schedule 1 of the Bill 'remove legal risk and provide clarity for agencies and stakeholders':

Schedule 1 of the bill finalises the implementation of the native title institutional reforms which commenced with amendments to the Financial Management and Accountability Regulations 1997 from 1 July last year. It folds the tribunal into the Federal Court statutory agency and makes consequential amendments to the governance, financial and annual reporting frameworks of the consolidated entity. The amendments remove legal risk and provide clarity for agencies and stakeholders. These

1 Explanatory Memorandum (EM), p. 2.

2 'Future act' is a defined term in section 223 of the Native Title Act 1993.

3 EM, p. 3.

4 Committee Hansard, 31 January 2013, p. 8.

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amendments will not only generate savings but also result in a better alignment and allocation of functions and a clearer focus on increasing the rate of claims resolution. These legislative amendments are supported by administrative arrangements such as a memorandum of understanding agreed between the agencies that will enable the tribunal to continue to perform its functions in a way that is consistent with its status as an independent statutory authority. The Native Title Registrar will continue to exercise powers relating to the day-to-day management of the administrative affairs of the tribunal and determining staffing arrangements within an agreed budget. In this way, the day-to-day operation of the tribunal will remain largely unchanged.5

2.6 In its submission to the inquiry, the Federal Court of Australia suggested that if the Bill was not passed in its current form, 'legal and administrative uncertainty' may result.6

Cost savings

2.7 It is expected that the proposed changes will result in cost savings of $4.75 million per year from 2012-13 - a total of $19 million over the four year forward estimates.7 The Skehill Review recommended that any administrative savings from reform of the NNTT be reinvested into 'native title mediation, reallocated to other priorities in the native title system or harvested to the Budget'.8 The Explanatory Memorandum (EM) to the Bill states that the cost savings achieved through the amendments will be reinvested in the Stronger Futures in the Northern Territory initiative.9

2.8 Mr Soden explained that the $19 million over four years 'is coming from the savings achieved with the reduced number of people as a result of the merger of the corporate functions'.10

2.9 The Deputy Registrar of the Federal Court, Ms Louise Anderson, further advised the committee:

…there have been 23 redundancies in the National Native Title Tribunal, which have contributed to those savings…And there were other savings in respect of the court taking over-for example, the corporate functions. So there is one system for managing human resource[s]-applications for leave

5 Dr Albin Smrdel, Attorney-General's Department (AGD), Committee Hansard, 31 January 2012, p. 10.

6 Submission 9, p. 7.

7 EM, p. 4.

8 Australian Government, Strategic Review of Small and Medium Agencies in the Attorney-General's Portfolio, Report to the Australian Government, January 2012, p. 83.

9 EM, p. 4.

10 Committee Hansard, 31 January 2013, p. 8.

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et cetera. There were consequential savings from that, but predominantly it was from staff.11

Support for Schedule 1 of the Bill

2.10 In respect of the proposals set out in Schedule 1 of the Bill, the Australian Institute of Aboriginal and Torres Strait Islander Studies offered 'broad support' for the amendments which bring into effect reforms to the operation of the NNTT and the Federal Court announced in June 2012.12

2.11 The National Native Title Council (Native Title Council) also informed the committee that it regards the amendments as administrative and that the changes will not affect the ability of the NNTT to carry out its functions:

…[the changes] do not intentionally impede the NNTT from properly carrying out its administrative functions…The proposed amendments to the [Native Title Act] seem to be coherent with the legislated objective of the NNTT, particularly in furtherance of the NNTT's economic efficiency.13

Engaging staff

2.12 The Native Title Council did however raise a concern that the transfer of certain administrative responsibilities, particularly in relation to engaging staff and consultants, from the NNTT President to the Registrar of the Federal Court, could result in the engagement of staff and consultants without the requisite cultural knowledge and experience.14

2.13 Mr Soden responded to these concerns:

Prior to 2009, then and now, the court has been and still is very fortunate in acquiring and retaining people with a deep understanding of the native title jurisdiction and related issues. There are native title specialists engaged by the court across the country and there are judges with special responsibility for managing the native title cases in their state. These people work very closely together managing workload and individual cases.15

2.14 Mr Soden sought to assure the committee that the concerns raised by the Native Title Council would not be realised:

I mention these issues as I note some continuing concerns in the submissions received by the committee. Those concerns include the suggestion that, by there being a transfer of financial and other administrative responsibilities from the tribunal to the court, and to me in

11 Committee Hansard, 31 January 2013, p. 8.

12 Submission 7, p. 1.

13 Submission 4, p. 1.

14 Submission 4, pp 2-3.

15 Committee Hansard, 31 January 2013, p. 7.

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particular, there might be an adverse impact on the role of the tribunal in their future act and registration responsibilities. I assure the committee that is not going to happen.16

2.15 A departmental officer also responded to the concerns raised by the Native Title Council in respect of engaging staff:

[W]e do not consider that the bill will change the current practice of the tribunal at all in this regard. We think what the Native Title Council has raised is, with the greatest of respect, a misreading of the bill. We think that the decisions to engage consultants in this regard will operate, because of the delegations that will be provided from the Registrar of the Federal Court to the Native Title Registrar, pretty much the way they do now. Indeed, as Mr Soden has indicated to you previously in his presentation, even if there were matters where there were consultants required to be appointed by the Federal Court, the Federal Court is clearly aware of the sensitivities that are required in those appointments so the government does not believe, with the greatest of respect, that there is a significant issue here.17

Schedule 2 of the Bill - Family Court and Federal Magistrates Court amendments

2.16 Schedule 2 sets out the proposed changes to the Family Court and the Federal Magistrates Court. A departmental representative explained that the changes are necessary to support arrangements that have been operating since 2009:

Schedule 2 of the bill amends the Family Law Act 1975 and the Federal Magistrates Act 1999 to ensure that these [A]cts are compatible with the courts operating under shared administration with a single chief executive officer. The Family Court and the Federal Magistrates Court have been operating under shared administration, including a single chief executive officer, since 2009.18

2.17 The officer further informed the committee that the joint administrative arrangements, operating since 2009, were found by the Skehill Report to have been a 'genuine success' and that it was on that basis that the Skehill Report recommended that the 'shared administration arrangements be formalised'.19

2.18 The Department noted that the Bill, which formalises these arrangements, does not affect the jurisdiction of either court and will provide legislative certainty:

The Family Court and the Federal Magistrates Court will be prescribed as a single agency for the purposes of the Financial Management and Accountability Act 1997, with a single chief executive officer. The bill does

16 Committee Hansard, 31 January 2013, p. 7.

17 Mr Kym Duggan, AGD, Committee Hansard, 31 January 2013, p. 11.

18 Dr Albin Smrdel, AGD, Committee Hansard, 31 January 2013, p. 10.

19 Dr Albin Smrdel, AGD, Committee Hansard, 31 January 2013, p. 10.

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not affect the jurisdiction of either court or the judicial work of either court and does not address broader issues of court structure. Formalising the courts' shared administration arrangements will provide the courts with certainty and will allow them to work towards further efficiencies and improved administration into the future.20

Support for Schedule 2 of the Bill

2.19 The Chief Justice of the Family Court of Australia, the Hon. Diana Bryant AO (Chief Justice), expressed general support for the intent of the Bill 'to facilitate the merger of the administrative functions of those two courts'.21

Definitions

2.20 The Chief Justice did however raise particular concerns in respect of the nomenclature and definitions of 'Chief Judge' and 'Chief Judge of the Federal Circuit Court of Australia'.22

2.21 The Chief Justice's primary concern related to an inconsistency between the Family Law Act 1975 and the Federal Court of Australia Act 1976 and the fact that the reference in the Bill to the head of the Family Court as the 'Chief Judge' does not accurately reflect that the Family Court is the superior court of record.23

2.22 In response to these matters, a representative from the Department advised the committee that the Chief Justice's suggestions were under consideration:

[T]his bill was purely about implementing the Skehill reforms. So the concerns raised by the Chief Justice are now with government to consider. I think it was just a matter of this not being seen as the legislative vehicle to make that particular change.24

2.23 The officer further explained that the Chief Justice's concerns are best addressed separately given the timeframes involved:

It is a separate issue…to the Skehill matter…it probably arises more out of the renaming of the Federal Magistrates Court to the Federal Circuit Court, with the Chief Federal Magistrate to be renamed as a chief judge. But the Family Court is the superior court and, whilst it does not say it in every provision, it still makes it clear that the Chief Judge of the Family Court is to be known as the Chief Justice of the Family Court…We see 1 July as a

20 Dr Albin Smrdel, AGD, Committee Hansard, 31 January 2013, p. 10.

21 Submission 1, p. 1.

22 Submission 1, p. 2.

23 Submission 1, p. 2.

24 Dr Albin Smrdel, AGD, Committee Hansard, 31 January 2013, p. 12.

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fairly critical date for the implementation of this particular bill, so we need to work through all the changes and choose another vehicle[.]25

Concerns raised by the Law Council of Australia

2.24 The Law Council of Australia (Law Council) raised concerns about Schedule 2 of the Bill in relation to the 'policy decision by the Government to maintain two separate Courts exercising family law jurisdiction'.26 The Law Council expressed the view that this approach is 'fundamentally flawed'.27

2.25 The Department responded to this assertion, advising the committee that the government has decided that it is not appropriate to address this particular issue in the Bill, but that it is willing to consider the matter further:

It was government policy to have the Family Court and the Federal Magistrates Court restructured so the Federal Magistrates Court would be folded into the Family Court and a separate Federal Magistrates Court exercising general law jurisdiction would still be in existence. Ultimately the government decided not to proceed with the restructure. The restructure involved two elements. There was the element of the desirability of having a one-stop shop for family law applicants to access the Family Court and to reduce confusion. It was also about efficiencies, savings and reducing the duplication of work. Mr Skehill was satisfied and recommended it to the government. The government was satisfied that in relation to the efficiencies side of things there was no need to move to a single court and that the shared arrangements was a genuine success…

The Attorney also indicated that, as part of that, the announcement would provide the courts necessary certainty, but the government will also look at the issue of providing greater certainty for applicants as well. That is a key initiative. That is not part of this bill. This bill is purely about implementing the Skehill recommendations, but it is certainly something the [then] Attorney has announced that she is going to look at and it is work that is in progress.28

Ensuring cooperation

2.26 The Law Council also raised concerns that the new arrangements are dependent on cooperative personal and professional relationships of the incumbents, which cannot always be guaranteed. Additionally, having only a single Chief Executive Officer reporting to two heads of the different jurisdictions may cause conflicts and inconsistency.29

25 Dr Albin Smrdel, AGD, Committee Hansard, 31 January 2013, p. 13.

26 Submission 5, p. 2.

27 Submission 5, p. 2.

28 Dr Albin Smrdel, AGD, Committee Hansard, 31 January 2013, p. 12.

29 Submission 5, pp 2-4.

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2.27 In response to these assertions, a departmental representative informed the committee:

The government acknowledges the close working relationship between Chief Justice Bryant and Chief Federal Magistrate Pascoe. But it is also…the government's expectation that the heads of jurisdiction would be able to work together cooperatively notwithstanding who the respective Chief Justice and—with the Federal Circuit Court legislation to come into effect in coming months—Chief Judge of the Federal Circuit Court are. As part of the Skehill recommendations, as well as his recommending that this bill be legislated to have the shared administration arrangements formalised between the Family Court and the Federal Magistrates Court, there was a recommendation for the heads of jurisdiction to come together as a consultative committee. That was really from a proposal brought forward by the heads of jurisdiction from the Federal Court, the Family Court and the Federal Magistrates Court, recognising the need to work whole-of-system and to work collegiately in a challenging fiscal environment.30

Committee comment

2.28 The committee acknowledges that the amendments set out in the Bill merely formalise administrative arrangements that have been operating since 2009. The committee notes that the Skehill Review considered these arrangements and recommended that they be formalised. The Bill achieves that outcome.

2.29 The committee takes the view that passage of the Bill will provide certainty for both agencies and stakeholders. The committee endorses the amendments set out in the Bill and considers they will achieve the stated purpose of enabling the agencies to implement savings, and to operate more efficiently and effectively into the future.

Recommendation 1

2.30 The committee recommends that the Bill be passed.

Senator Trish Crossin

Chair

30 Dr Albin Smrdel, AGD, Committee Hansard, 31 January 2013, p. 11.

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ADDITIONAL COMMENTS BY COALITION SENATORS

1.1 Coalition senators believe that this legislation has been introduced without regard to the requirements expressed by both the Chief Justice of the Family Court and the Chief Federal Magistrate in a letter to the Attorney-General's Department of 18 October 2012, specifically, that it will be necessary - despite the administrative merger of the Courts to be effected by this Bill - for the establishment of separate principal registrar positions responsible for judicial administration.

1.2 The Government apparently acknowledges the need for these positions and has indicated at Senate Estimates that it plans to give effect to the heads of jurisdictions' proposals. Given that the need for amendments has been acknowledged, it would be timely, and a much more efficient use of the Parliament's time to introduce them when the Bill comes before the Senate.

Senator Gary Humphries Senator Sue Boyce

Deputy Chair

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APPENDIX 1

SUBMISSIONS RECEIVED

Submission Number Submitter

1 The Hon Diana Bryant AO, Chief Justice, Family Court of Australia

2 Community and Public Sector Union

3 Consumer Law Centre of the ACT

4 National Native Title Council

5 Law Council of Australia

6 Confidential

7 Australian Institute of Aboriginal and Torres Strait Islander Studies

8 The Law Society of South Australia

9 Federal Court of Australia

10 NTSCORP

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APPENDIX 2

WITNESSES WHO APPEARED BEFORE THE COMMITTEE

Canberra, 31 January 2013

ANDERSON, Ms Louise, Deputy Registrar, Federal Court of Australia

DUGGAN, Mr Kym, First Assistant Secretary, Social Inclusion Division, Attorney-General's Department

GASZNER, Mr David, Executive Member, Federal Litigation Section; Chair, Federal Magistrates/Federal Circuit Court Liaison Committee, Law Council of Australia

MEIBUSCH, Ms Margaret, Principal Legal Officer, Federal Courts Branch, Access to Justice Division, Attorney-General's Department

O'BRIEN, Mr Richard, Chair, Family Law Section, Law Council of Australia

SMRDEL, Dr Albin, Assistant Secretary, Federal Courts Branch, Access to Justice Division, Attorney-General's Department

SODEN, Mr Warwick, Registrar and Chief Executive Officer, Federal Court of Australia

WU, Mr Alan, Legal Officer, Native Title Unit, Social Inclusion Division, Attorney-General's Department

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The Senate

Legal and Constitutional Affairs

Legislation Committee

Crimes Legislation Amendment (Law Enforcement Integrity, Vulnerable Witness Protection and Other Measures) Bill 2013 [Provisions]

June 2013

101

© Commonwealth of Australia

ISBN: 978-1-74229-886-3

This document was produced by the Senate Legal and Constitutional Affairs Committee secretariat and printed by the Senate Printing Unit, Department of the Senate, Parliament House, Canberra.

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MEMBERS OF THE COMMITTEE

Members

Senator Patricia Crossin, Chair, ALP, NT

Senator Gary Humphries, Deputy Chair, LP, ACT

Senator Sue Boyce, LP, QLD

Senator Mark Furner, ALP, QLD

Senator Louise Pratt, ALP, WA

Senator Penny Wright, AG, SA

Participating Members

Senator Sarah Hanson-Young, AG, SA

Secretariat

Mr Tim Bryant Inquiry Secretary

Mr CJ Sautelle Senior Research Officer

Ms Elise Williamson Administrative Officer

Ms Maddie Willis Administrative Officer

Suite S1.61 Telephone: (02) 6277 3560

Parliament House Fax: (02) 6277 5794

CANBERRA ACT 2600 Email: legcon.sen@aph.gov.au

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TABLE OF CONTENTS

MEMBERS OF THE COMMITTEE ............................................................. iii

RECOMMENDATION ................................................................................... vii

CHAPTER 1 ........................................................................................................ 1

INTRODUCTION AND BACKGROUND ............................................................ 1

Referral of the inquiry ............................................................................................ 1

Purpose of the Bill .................................................................................................. 1

Overview of the Bill ............................................................................................... 1

Conduct of the inquiry ............................................................................................ 3

CHAPTER 2 ........................................................................................................ 5

KEY ISSUES ............................................................................................................. 5

Amendments dealing with people smuggling matters (Schedule 3) ...................... 5

Other Schedules of the Bill addressed in submissions ......................................... 11

Committee view .................................................................................................... 12

ADDITIONAL COMMENTS BY COALITION SENATORS .................... 15

ADDITIONAL COMMENTS BY THE AUSTRALIAN GREENS ............ 17

APPENDIX 1 ..................................................................................................... 19

SUBMISSIONS RECEIVED ................................................................................. 19

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RECOMMENDATION

Recommendation 1

2.34 The committee recommends that the Senate pass the Bill.

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CHAPTER 1

INTRODUCTION AND BACKGROUND

Referral of the inquiry

1.1 On 29 May 2013, the Crimes Legislation Amendment (Law Enforcement Integrity, Vulnerable Witness Protection and Other Measures) Bill 2013 (Bill) was introduced into the House of Representatives by the Attorney-General, the Hon Mark Dreyfus QC MP (Attorney-General).1 The Bill was passed by the House of Representatives on 17 June 2013,2 and introduced into the Senate on 19 June 2013.3

1.2 On 18 June 2013 the Senate referred the provisions of the Bill to the Legal and Constitutional Affairs Legislation Committee (committee), for inquiry and report by 20 August 2013.4 In order to assist the parliament's timely consideration of the Bill, the committee decided to present its report for the inquiry on 25 June 2013.

Purpose of the Bill

1.3 In his second reading speech, the Attorney-General stated that the Bill 'includes a range of measures which strengthen existing laws and ensure that the criminal law in this country is responsive to emerging threats'.5 The Attorney-General explained that, in particular, the proposed amendments would strengthen Commonwealth criminal law 'in combating corruption and protecting the vulnerable victims of serious Commonwealth offences'.6

Overview of the Bill

1.4 The Bill comprises six schedules, which would make amendments to various Commonwealth Acts.

1.5 Schedule 1 contains amendments to the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML-CTF Act) and the Law Enforcement Integrity Commissioner Act 2006 to improve the Integrity Commissioner's ability to

1 House of Representatives, Votes and Proceedings, No. 166, 29 May 2013, p. 2303.

2 House of Representatives, Votes and Proceedings, No. 172, 17 June 2013, p. 2404.

3 Journals of the Senate, No. 149, 19 June 2013, pp 4095-96.

4 Journals of the Senate, No. 148, 18 June 2013, p. 4048.

5 The Hon Mark Dreyfus QC MP, Second Reading Speech, House of Representatives Hansard, 29 May 2013, p. 8.

6 The Hon Mark Dreyfus QC MP, Second Reading Speech, House of Representatives Hansard, 29 May 2013, p. 11.

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access information held by the Australian Transaction Reports and Analysis Centre (AUSTRAC) and to improve the ability of the Australian Commission for Law Enforcement Integrity (ACLEI) to second employees of police forces who are not sworn police officers.7

1.6 Schedule 2 contains amendments to the Crimes Act 1914 (Crimes Act) and Criminal Code Act 1995 to ensure that victims and witnesses in Commonwealth criminal proceedings for slavery, slavery-like and human trafficking offences are afforded appropriate support and protection.8

1.7 Schedule 3 contains amendments to the Crimes Act and the

Migration Act 1958 (Migration Act) in relation to investigations and prosecutions of people smuggling crew members, including to:

• remove wrist x-rays as a prescribed age determination process;

• clarify that the prosecution bears the onus of proof in establishing that a defendant is 18 years or older, in cases where age is in dispute;

• enable the use of evidentiary certificates in people smuggling cases; and

• ensure that time spent in immigration detention is taken into consideration during sentencing for people smuggling offences.9

1.8 Schedule 4 contains amendments to the AML-CTF Act to strengthen the Commonwealth anti-money laundering and counter-terrorism legislative framework.10

1.9 Schedule 5 contains amendments to the International War Crimes Tribunal Act 1995 and the International Transfer of Prisoners Act 1997 in order to recognise the International Residual Mechanism for Criminal Tribunals.11

1.10 Schedule 6 contains amendments to the Australian Federal Police Act 1979 in order to update the legislative framework for the provision of policing and regulatory services in the external territories.12

7 Explanatory Memorandum (EM), p. 2.

8 EM, p. 3.

9 EM, p. 4.

10 EM, p. 5.

11 EM, p. 6.

12 EM p. 6.

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Conduct of the inquiry

1.11 Details of the inquiry, including links to the Bill and associated documents, were placed on the committee's website at www.aph.gov.au/senate_legalcon. The committee also wrote to over 90 organisations and individuals, inviting submissions by 20 June 2013.

1.12 The committee received six submissions, which are listed at Appendix 1. All submissions were published on the committee's website. No public hearings were held for the inquiry. The committee thanks those organisations that made submissions to the inquiry.

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CHAPTER 2

KEY ISSUES

2.1 Due to the time available to the committee in conducting the inquiry, and the balance of the issues addressed in submissions, the committee has chosen to focus on Schedule 3 of the Bill, which deals with amendments relating to people smuggling investigations and prosecutions. Support from submitters for other schedules in the Bill is also noted.

Amendments dealing with people smuggling matters (Schedule 3)

2.2 The provisions in Schedule 3 of the Bill attracted some commentary from submitters. Australian Lawyers for Human Rights noted that, while it was unable to sufficiently assess the Bill in the time available, it would 'likely support' the proposed amendments dealing with people smuggling, as they would improve the consistency of Australia's law with human rights standards.1

2.3 The Joint Australian Government Submission (Government Submission) expressed support for the measures in Schedule 3, stating that the proposed amendments will 'enhance the effectiveness and efficiency of the investigatory and prosecutorial process' in people smuggling cases.2

Removal of wrist x-rays as a prescribed procedure for age determination

2.4 Subsection 3ZQA(1) of the Crimes Act 1914 (Crimes Act) provides that the defined term 'age determination information' means 'a photograph (including an X-ray photograph) or any other record or information relating to a person that is obtained by carrying out a prescribed procedure'. Item 1 of Schedule 3 of the Bill would amend subsection 3ZQA(1) by omitting the words 'a photograph (including an X-ray photograph) or any other record or information' and substituting 'a record, or information'.

2.5 Subsection 3ZQA(2) of the Crimes Act provides that the Crimes

Regulations 1990 (Crimes Regulations) may 'specify a particular procedure, which may include the taking of an X-ray of a part of a person's body, to be a prescribed procedure for determining a person's age'. Item 2 of Schedule 3 would amend

subsection 3ZQA(2) by omitting the reference to taking an x-ray of a part of a person's body.

2.6 The Explanatory Memorandum (EM) states that these amendments are 'necessary to respond to concerns about the accuracy of wrist x-ray materials in

1 Submission 1, p. 1.

2 Submission 5, p. 4.

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making a determination in relation to a person's age'.3 The EM also notes that consequential amendments to the Crimes Regulations will be required to remove wrist x-rays as a prescribed procedure for age determination.4

Previous consideration in committee and other inquiries

2.7 The removal of wrist x-rays as a prescribed procedure for age determination under the Crimes Act is an issue that has been canvassed for some time. As early as 2001, when wrist x-rays were first prescribed as an age determination procedure under the Crimes Act, concerns were raised regarding the reliability of this method to

clearly determine the age of individuals.5

2.8 During this committee's inquiry into the Crimes Amendment (Fairness for Minors) Bill 2011, submitters and witnesses criticised or raised concerns with the use of wrist x-rays to determine the age of alleged people smugglers. These included medical experts such as the Royal Australian and New Zealand College of

Radiologists, the Royal Australian College of Physicians, Professor Tim Cole and Professor Sir Al Aynsley-Green Kt.6

2.9 Similar concerns were raised by submitters and witnesses during the Senate Legal and Constitutional Affairs References Committee (References Committee) inquiry into the Detention of Indonesian minors in Australia.7 The main concerns raised in relation to the use of wrist x-rays are that:

• the accuracy of wrist x-rays as an age assessment tool has been discredited;

• variations in skeletal maturity based on environmental and ethnic factors lead to inaccurate conclusions of wrist x-rays;

• the skeletal atlases used for most wrist x-ray age assessments are out-dated and not suited to individuals of Indonesian ethnicity; and

• the use of x-rays for non-medical purposes raises serious ethical concerns. 8

3 EM, p. 60.

4 EM, p. 60. Regulation 6C of the Crimes Regulations 1990 currently provides that an x-ray of the hand and wrist is a prescribed procedure for age determination.

5 See: Senate Legal and Constitutional Affairs Legislation Committee, Crimes Amendment (Fairness for Minors) Bill 2011, April 2012, p. 12.

6 See: Senate Legal and Constitutional Affairs Legislation Committee, Crimes Amendment (Fairness for Minors) Bill 2011, April 2012, pp 12-13; Royal Australasian College of Physicians, Submission 7 to the committee's inquiry into the Crimes Amendment (Fairness for Minors) Bill 2011, pp 1-2.

7 Senate Legal and Constitutional Affairs References Committee, Detention of Indonesian minors in Australia, October 2012, p. 36.

8 See: Senate Legal and Constitutional Affairs References Committee, Detention of Indonesian minors in Australia, October 2012, p. 36.

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2.10 The References Committee recommended:

Subject to the advice of the Office of the Chief Scientist regarding the utility of wrist x-rays as an age assessment tool, and noting evidence received by the committee raising significant doubts about this procedure, the committee recommends that the Australian Government consider removing wrist x-rays as a prescribed procedure for the determination of age under…the Crimes Act 1914 and regulation 6C of the Crimes Regulations 1990.9

2.11 In 2012, the Australian Human Rights Commission (AHRC) also considered the use of wrist x-rays for age assessment in people smuggling cases, in its report An age of uncertainty: Inquiry into the treatment of individuals suspected of people smuggling offences who say that they are children.10 The AHRC recommended that amendments to the Crimes Act should be made to restrict or limit procedures using x-rays as part of a prescribed procedure to determine age, and that wrist x-rays should not be able to be used in legal proceedings as evidence that persons are over 18 years of age.11

Evidence presented to the current inquiry

2.12 The Government Submission noted that the proposed amendments to section 3ZQA of the Crimes Act, along with future proposed amendments to the Crimes Regulations, would address Recommendation 1 of the References Committee inquiry, as well as the recommendations made by the AHRC in relation to the use of wrist x-rays.12 This submission also noted:

[These amendments] will not affect current practice as wrist [x-rays] have not been offered as a method of determining age by the Australian Federal Police since August 2011, unless requested by the defendant. It remains open to [the Department of Immigration and Citizenship], the [Australian Federal Police] and [the Commonwealth Director of Public Prosecutions] to use any method or combination of methods to determine whether a person is more likely than not to be a minor…

The proposal to remove wrist [x-rays] as a prescribed procedure will not change current age determination processes, but will respond to criticisms about the use of wrist [x-rays] and is supported by the Office of the Chief Scientist which has expressed the view that there is not sufficient

9 Senate Legal and Constitutional Affairs References Committee, Detention of Indonesian minors in Australia, October 2012, p. 60 (Recommendation 1).

10 Australian Human Rights Commission, An age of uncertainty: Inquiry into the treatment of individuals suspected of people smuggling offences who say that they are children, July 2012, pp 161-231.

11 Australian Human Rights Commission, An age of uncertainty: Inquiry into the treatment of individuals suspected of people smuggling offences who say that they are children, July 2012, p. 12.

12 Submission 5, p. 3.

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scientific data to support the use of wrist [x-rays] to determine whether a person is a minor.13

Amendments to the Migration Act relating to people smuggling matters

2.13 Item 4 of Schedule 3 would insert proposed new sections 236C-236F into the Migration Act, which deal with several other matters in relation to people smuggling investigations and prosecutions.

Courts to take into account time spent in immigration detention when sentencing

2.14 Proposed new section 236C provides that, when imposing a sentence on an individual convicted of people smuggling offences, a court must take into account any time the individual has spent in immigration detention. In relation to this amendment,

the EM states:

Experience has shown that the crew of suspected irregular entry vessels (SIEVs) can spend lengthy periods in immigration detention between arrival in Australia and possible conviction for people smuggling. However, as immigration detention is a non-custodial and non-punitive administrative arrangement, there may be doubt as to whether section 16E of the Crimes Act, and relevant State and Territory sentencing laws, allow a court to take time spent in immigration detention into consideration when sentencing individuals for people smuggling under the Migration Act…

The aim of this amendment is to ensure that, when imposing mandatory minimum penalties for people smuggling offences, all pre-sentence detention, whether administrative or custodial, is taken into account for

people smugglers. It will also ensure consistent treatment of time spent in custody and immigration detention throughout State and Territory jurisdictions.14

2.15 The Government Submission noted that, in practice, courts are already taking time spent in immigration detention and remand into account when sentencing.15

Burden and standard of proof in age determination hearings

2.16 In its report on the Crimes Amendment (Fairness for Minors) Bill 2011, this committee recommended that the Australian Government introduce legislation to expressly provide that, where a person raises the issue of age during criminal proceedings, the prosecution bears the burden of proof to establish that the person was

13 Submission 5, p. 3. In relation to the advice provided by the office of the Chief Scientist, see also: Australian Government, 'Response to the Senate Legal and Constitutional Affairs References Committee report: Detention of Indonesian minors in Australia', Submission 5, Attachment 2, p. 3.

14 EM, pp 61-62.

15 Submission 5, p. 4.

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an adult at the time of the relevant offence.16 This recommendation was reiterated by the References Committee in its inquiry into the Detention of Indonesian minors in Australia.17

2.17 Item 4 of Schedule 3 of the Bill seeks to implement these committee recommendations. Proposed new section 236D of the Migration Act would clarify the burden and standard of proof in relation to proceedings for people smuggling offences where the defendant claims to have been aged under 18 years at the time the alleged offence was committed. This proposed new section provides that the prosecution bears the burden of proving, on the balance of probabilities, that the defendant was aged 18 years or over at that time. The EM notes:

Subsection 236B(2) of the Migration Act establishes that mandatory minimum penalties for certain people smuggling offences do not apply if it is established on the balance of probabilities that the person was aged under

18 years when the offence was committed…

Experience has shown that the majority of defendants being prosecuted for people smuggling offences do not possess proof of age documentation. This amendment ensures that such defendants are not unduly prejudiced by being required to prove age. Generally, investigative age determination processes establish age before a person is charged with a people smuggling offence.18

2.18 The Government Submission noted that this amendment reflects current practice in people smuggling proceedings where the age of the defendant is raised as an issue.19 This is consistent with evidence given to the References Committee inquiry in August 2012 by the then Commonwealth Director of Public Prosecutions, Mr Chris Craigie SC, who stated that he would be comfortable with this practice being codified in the Migration Act.20

16 Senate Legal and Constitutional Affairs Legislation Committee, Crimes Amendment (Fairness for Minors) Bill 2011, April 2012, p. 30 (Recommendation 2).

17 Senate Legal and Constitutional Affairs References Committee, Detention of Indonesian minors in Australia, October 2012, p. 63 (Recommendation 6).

18 EM, p. 62.

19 Submission 5, p. 3. See also: Australian Government, 'Response to the Senate Legal and Constitutional Affairs References Committee report: Detention of Indonesian minors in Australia', Submission 5, Attachment 2, p. 6.

20 See: Senate Legal and Constitutional Affairs References Committee, Detention of Indonesian minors in Australia, October 2012, p. 49.

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Use of evidentiary certificates in people smuggling prosecutions

2.19 Proposed new sections 236E-236F provide for the use of evidentiary certificates in the prosecution of people smuggling offences.

2.20 Proposed new section 236E provides that matters stated in an evidentiary certificate are to be received as prima facie evidence in a court, and details the types of information evidentiary certificates may contain. This includes factual information in relation to the location and boarding of ships or aircraft involved in alleged people smuggling activities, and the number of passengers and crew on such vessels. In relation to the need for evidentiary certificates, the EM states:

Different Royal Australian Navy (RAN) personnel and personnel assigned to Border Protection Command (BPC) will observe various different aspects of the boarding of a SIEV in Australian waters. To present a court with a complete account of the boarding of a SIEV, it is necessary to obtain evidence from a large number of RAN personnel and personnel assigned to BPC. This creates a logistical difficulty for prosecuting people smuggling offences as RAN personnel assigned to BPC have limited access to communications, other than secure communications, and because the intercepting vessels can remain on patrol for long periods for national security purposes.

It is important to minimise the time spent by RAN personnel and personnel assigned to BPC providing evidence to law enforcement agencies and appearing at court in relation to prosecutions of people smuggling offences. It is in the interests of national security that the capacity of such personnel to carry out border protection duties be restrained as little as practicable.

The evidentiary certificates inserted by this item will contain a consolidation of relevant observations made by RAN, BPC, or other relevant agency personnel, in the course of intercepting a SIEV or aircraft. In this way, the information provided in an evidentiary certificate may not be limited to the observations of one particular officer, although it will be signed by an individual officer.

In preparing an evidentiary certificate, an officer will be required to act in accordance with principles of administrative decision making in deciding whether to include a matter.21

2.21 Proposed new section 236F provides for certain procedural rules in relation to evidentiary certificates. Under these provisions, a defendant or their legal representative must be given adequate notice before the prosecution may adduce an evidentiary certificate in court, and the person who signed the evidentiary certificate may be called to appear and be cross-examined in relation to the matters stated in the certificate.

21 EM, pp 62-63.

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2.22 The Government Submission noted that evidentiary certificates will contain material that is not likely to be in dispute, and that an accused person is entitled to challenge the contents of an evidentiary certificate in court.22 Further, the Bill provides that any evidence given in rebuttal of an evidentiary certificate 'must be considered on its merits and not discounted by reason of the fact that an evidentiary certificate has been admitted into evidence'.23

Other Schedules of the Bill addressed in submissions

2.23 Some submitters commented on other aspects of the Bill, namely amendments in Schedules 2 and 4.

Amendments supporting victims of slavery, slavery-like and human trafficking offences (Schedule 2)

2.24 Australian Catholic Religious Against Trafficking in Humans commended the amendments in Schedule 2 of the Bill, stating that extending vulnerable witness protection to victims of slavery, slavery-like and human trafficking offences 'will be one way of reducing the level of re-traumatization of individuals giving evidence in relation to the harm they have suffered'.24

2.25 Anti-Slavery Australia expressed strong support for these amendments, and in particular welcomed the following aspects of the proposed changes:

• the use of closed circuit television in the giving of evidence of vulnerable adult and child witnesses and special witnesses;

• the reduction of contact with or removal of the offender and public when giving evidence in court; and

• the provision for an accompanying support person to be present while giving evidence.25

2.26 Anti-Slavery Australia also expressed support for the introduction of a victim impact statement scheme in the Crimes Act for victims of federal offences.26

22 Submission 5, p. 4.

23 Submission 5, p. 4.

24 Submission 6, p. 3.

25 Submission 4, pp 2 and 4.

26 Submission 4, pp 4-5.

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Amendments to the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Schedule 4)

2.27 The Clean Energy Regulator (CER) welcomed the provisions in Schedule 4 of the Bill which seek to add the CER as a designated agency under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006. The CER stated that this amendment will enable AUSTRAC to share financial intelligence information with the CER, assisting the CER in ensuring that the regulatory schemes it administers remain free from criminal influence and exploitation.27

Committee view

2.28 The committee is satisfied that the amendments in Schedule 3 of the Bill contain sensible amendments to improve the current processes around age determination, and the efficiency and effectiveness of people smuggling

investigations and prosecutions.

Age determination matters

2.29 The committee welcomes amendments to the Crimes Act to facilitate removing wrist x-rays as a prescribed procedure for age determination. Removing wrist x-rays as a prescribed procedure is supported by the weight of expert medical opinion, the Office of the Chief Scientist, and previous recommendations of the Senate Legal and Constitutional Affairs References Committee and the Australian Human Rights Commission. Further, the committee has heard that this procedure has not been utilised by the Australian Federal Police since August 2011. The committee notes that consequential amendments to the Crimes Regulations will be necessary to fully implement this decision, and considers that these amendments should be brought forward as soon as practicable.

2.30 The committee also welcomes the introduction of proposed new section 236D of the Migration Act, to clarify that the prosecution bears the onus of proof in establishing that an alleged people smuggler is 18 years or older, in cases where age is in dispute. This measure accords with the current practice of the Commonwealth Director of Public Prosecutions, and has previously been recommended by this committee and by the Senate Legal and Constitutional Affairs References Committee.

Further amendments to the Migration Act

2.31 The amendments to the Migration Act to allow for the use of evidentiary certificates in people smuggling will help expedite the process of finalising people smuggling investigations and prosecutions. The committee considers that streamlining the process of establishing the facts in people smuggling cases is in the interests of Australia's Navy and Border Protection Command personnel, as it will allow them to

27 Submission 3, p. 1.

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focus their time on operational matters rather than the administrative processes associated with providing evidence in people smuggling prosecutions. The use of evidentiary certificates will lessen the time taken to complete people smuggling prosecutions, facilitating the speedy administration of justice in these cases.

2.32 The committee also supports amendments to clarify that time spent in immigration detention can be taken into account by a court when sentencing in people smuggling cases. This is already the practice of some courts, and this amendment will bring consistency to the treatment of this issue across all state and territory jurisdictions.

Other schedules in the Bill

2.33 The committee notes the support in submissions for other aspects of the Bill, particularly the introduction of protections for vulnerable witnesses in slavery, slavery-like and human trafficking cases in Schedule 2 of the Bill. The committee commends these measures, which will make it easier for the victims of these serious offences to access redress through the courts.

Recommendation 1

2.34 The committee recommends that the Senate pass the Bill.

Senator Trish Crossin

Chair

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ADDITIONAL COMMENTS BY COALITION SENATORS 1.1 Coalition senators consider that the terms of the Crimes Legislation Amendment (Law Enforcement Integrity, Vulnerable Witness Protection and Other Measures) Bill 2013 are directed at a number of apparently useful changes to existing legislation. Some of those changes have been expressly welcomed by submitters to the inquiry.

1.2 However, Coalition senators take this opportunity to outline their concerns with the lack of proper scrutiny which this bill has been afforded under this rushed reference to the committee.

1.3 Input to this inquiry has been seriously hampered by the restrictive timeframe, putting at risk the strong reputation of this committee for conducting careful and comprehensive scrutiny of every bill referred to it.

1.4 It is this fact that Australian Lawyers for Human Rights (ALHR) raise in their submission where they state:

The fact that submissions are required in less than 40 hours destroys any notion of accountability and public scrutiny which is sought to be provided by public involvement in the committee process.1

1.5 They go on to say:

However because of the time period the Parliament has chosen to allocate for submissions, ALHR are unable to assess and respond on these matters. We would like the Committee to note our concern and opposition to such a short time being made for submissions.2

1.6 That only six submissions were received to this inquiry, three of which were submitted from government bodies, highlights the Government's haste to pass through this parliament a raft of last minute legislation.

1.7 In light of this, Coalition senators feel unable to express wholehearted confidence in the package of measures this bill incorporates, but do not recommend that the Senate reject the measures on that ground alone.

Senator Gary Humphries Senator Sue Boyce

Deputy Chair

1 Submission 1, p. 1.

2 Submission 1, p. 1.

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ADDITIONAL COMMENTS BY THE AUSTRALIAN GREENS 1.1 The Australian Greens particularly welcome the provisions of this Bill (the proposed amendments to section 3ZQA of the Crimes Act) which finally remove wrist x-rays as a prescribed procedure for age determination under the Crimes Act. This is a longstanding issue which has been the subject of recommendations of both the Senate's Legal and Constitutional Affairs Legislation, and References, Committees, due to inquiries initiated by the Australian Greens.

1.2 In 2011, after serious concerns had been raised by medical and human rights organizations, Australian Greens Senator Sarah Hanson-Young introduced the Crimes Amendment (Fairness for Minors) Bill 2011 into the Senate, which included provisions to remove the taking and use of discredited wrist (or other skeletal) x-rays in age determination processes. During the subsequent inquiry into the bill, submitters and witnesses, including the Royal Australian and New Zealand College of Radiologists, the Royal Australian College of Physicians, Professor Tim Cole and Professor Sir Al Aynsley-Green Kt, criticised the reliability of wrist x-rays to determine the age of alleged people smugglers and opposed their use.

1.3 The majority of the committee declined to recommend the removal of wrist x-rays as a prescribed procedure at the time but Senator Hanson-Young's Dissenting Report stated:

The Australian Greens strongly support abolishing the use of bone x-rays due to the risks and uncertainty expressed by medical experts, in favour of a complete, holistic and expedient age determination process starting with the initial interview with the Department of Immigration.1

1.4 In May 2012, the Australian Greens initiated a further inquiry by the Senate Legal and Constitutional Affairs References Committee into the Detention of Indonesian minors in Australia. Again, serious concerns were raised about the accuracy and reliability of wrist x-rays as an age assessment tool, their suitability for individuals of Indonesian ethnicity and the ethical issues surrounding their use for non-medical purposes.

1.5 In October 2012, as a result of the inquiry, the References Committee recommended that the Australian Government consider removing wrist x-rays as a prescribed procedure for the determination of age under the Crimes Act and in the Crimes Regulations, subject to the advice of the Office of the Chief Scientist regarding their utility as an age assessment tool.

1.6 The provisions in this Bill are a result of the Government's response to the References Inquiry report of October 2012 - a long overdue reform to remove

1 Senate Legal and Constitutional Affairs Legislation Committee, Crimes Amendment (Fairness for Minors) Bill 2011, April 2012, p. 43.

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discredited wrist x-rays as a way of determining age, and the Australian Greens welcome them.

1.7 The Australian Greens also acknowledge the persistent and expert advocacy for these reforms from a number of peak medical and legal organisations, community groups and legal representatives across Australia.

Senator Penny Wright Senator Sarah Hanson-Young

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APPENDIX 1 SUBMISSIONS RECEIVED

Submission Number Submitter

1 Australian Lawyers for Human Rights

2 Australian Human Rights Commission

3 Clean Energy Regulator

4 Anti-Slavery Australia

5 Joint Australian Government Submission

6 Australian Catholic Religious Against Trafficking in Humans

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The Senate

Legal and Constitutional Affairs

Legislation Committee

Crimes Legislation Amendment (Organised Crime and Other Measures) Bill 2012 [Provisions]

March 2013

129

© Commonwealth of Australia

ISBN: 978-1-74229-782-8

This document was produced by the Senate Legal and Constitutional Affairs Committee secretariat and printed by the Senate Printing Unit, Department of the Senate, Parliament House, Canberra.

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MEMBERS OF THE COMMITTEE

Members

Senator Patricia Crossin, Chair, ALP, NT

Senator Gary Humphries, Deputy Chair, LP, ACT

Senator Sue Boyce, LP, QLD

Senator Mark Furner, ALP, QLD

Senator Louise Pratt, ALP, WA

Senator Penny Wright, AG, SA

Secretariat

Ms Julie Dennett Committee Secretary

Mr CJ Sautelle Senior Research Officer

Ms Elise Williamson Administrative Officer

Suite S1.61 Telephone: (02) 6277 3560

Parliament House Fax: (02) 6277 5794

CANBERRA ACT 2600 Email: legcon.sen@aph.gov.au

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TABLE OF CONTENTS

MEMBERS OF THE COMMITTEE ............................................................. iii

RECOMMENDATION ................................................................................... vii

CHAPTER 1 ........................................................................................................ 1

INTRODUCTION AND BACKGROUND ............................................................ 1

Referral of the inquiry ............................................................................................ 1

Purpose of the Bill .................................................................................................. 1

Background ............................................................................................................. 2

Key provisions of the Bill ....................................................................................... 4

Conduct of the inquiry ............................................................................................ 7

Acknowledgement .................................................................................................. 8

Note on references .................................................................................................. 8

CHAPTER 2 ........................................................................................................ 9

KEY ISSUES ............................................................................................................. 9

Schedule 1 - amendments to the Proceeds of Crime Act 2002 (POC Act) ........... 9

Schedule 2 - amendments to the Criminal Code Act 1995 (Criminal Code) ...... 16

Committee view .................................................................................................... 18

ADDITIONAL COMMENTS BY THE AUSTRALIAN GREENS ............ 21

APPENDIX 1 ..................................................................................................... 23

SUBMISSIONS RECEIVED ................................................................................. 23

APPENDIX 2 ..................................................................................................... 25

WITNESSES WHO APPEARED BEFORE THE COMMITTEE ................... 25

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RECOMMENDATION

Recommendation 1

2.47 The committee recommends that the Senate pass the Bill.

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CHAPTER 1

INTRODUCTION AND BACKGROUND

Referral of the inquiry

1.1 On 28 November 2012, the Crimes Legislation Amendment (Organised Crime and Other Measures) Bill 2012 (Bill) was introduced into the House of Representatives by the Minister for Justice, the Hon Jason Clare MP.1 On 29 November 2012, the Senate referred the provisions of the Bill to the Legal and

Constitutional Affairs Legislation Committee (committee) for inquiry and report by 13 March 2013.2

Purpose of the Bill

1.2 The Bill consists of two schedules. Schedule 1 of the Bill seeks to amend the Proceeds of Crime Act 2002 (POC Act) to:

• ensure that evidence relevant to unexplained wealth proceedings can be seized under a search warrant;

• allow the time limit for serving notice of a preliminary unexplained wealth order to be extended by a court in certain circumstances;

• harmonise provisions relating to the payment of legal expenses for

unexplained wealth cases;

• allow charges to be created over restrained property to secure payment of an unexplained wealth order;

• remove a court's discretion to make unexplained wealth restraining orders, preliminary unexplained wealth orders and unexplained wealth orders once relevant criteria are satisfied; and

• expand the Parliamentary Joint Committee on Law Enforcement's oversight of unexplained wealth investigations and litigation.

1.3 The Explanatory Memorandum to the Bill (EM) states that the amendments in Schedule 1 are designed to strengthen the Commonwealth's unexplained wealth regime and 'ensure that the Government has strong laws to target the substantial profits made by serious and organised crime'.3

1 House of Representatives Votes and Proceedings, 28 November 2012, p. 2002.

2 Journals of the Senate, No. 129-29 November 2012, p. 3480.

3 Explanatory Memorandum (EM), p. 2.

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1.4 Schedule 2 of the Bill seeks to amend the Criminal Code Act 1995 (Criminal Code) to:

• provide that cross-border firearms trafficking offences cover firearm parts;

• introduce aggravated offences for dealing in 50 or more firearms and firearm parts;

• increase the penalties for illegal importation or exportation of larger numbers of firearms; and

• introduce aggravated offences for importing or exporting 50 or more firearms or firearm parts during a six month period.

Background

1.5 The proposed changes to the POC Act and the Criminal Code arise in the context of previous parliamentary committee recommendations, and announced reforms to the regulation of firearms in Australia.

Commonwealth unexplained wealth laws

1.6 In February 2010, the parliament passed amendments to the POC Act to introduce provisions relating to unexplained wealth orders.4 The unexplained wealth provisions are one of five types of asset confiscation proceedings provided for in the POC Act, and are designed to undermine organised crime by targeting the profits of crime. The Australian Federal Police (AFP) has stated:

These provisions can be used to target criminals who derive an income from criminal activity, but because of where they sit in criminal enterprise and their lack of proximity to the offences committed, cannot be pursued through criminal prosecution or traditional proceeds of crime action.5

1.7 The EM outlines how the Commonwealth's unexplained wealth provisions operate:

[I]f a court is satisfied that there are reasonable grounds to suspect that a person's total wealth exceeds the value of the person's wealth that was lawfully acquired, the court can compel the person to attend court and prove, on the balance of probabilities, that their wealth was not derived from offences with a connection to Commonwealth power. If a person cannot demonstrate this, the court may order them to pay to the Commonwealth the difference between their total wealth and their legitimate wealth.6

4 Crimes Legislation Amendment (Serious and Organised Crime) Act 2010.

5 Australian Federal Police, Submission to the Parliamentary Joint Committee on Law Enforcement Inquiry into Commonwealth unexplained wealth legislation and arrangements, October 2011, p. 2.

6 EM, p. 4.

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1.8 There are three types of orders which can be made by the courts under the unexplained wealth provisions in the POC Act. Subject to relevant criteria, a court may make:

• a restraining order, which prevents certain property from being disposed of or otherwise dealt with by any person;7

• a preliminary unexplained wealth order, which requires a person to appear before the court for the purpose of enabling the court to decide whether or not to make an unexplained wealth order in relation to the person;8 and

• an unexplained wealth order, which requires a person to pay an amount to the Commonwealth if the court is not satisfied that the whole or any part of the person's wealth was not derived from a Commonwealth offence, a foreign indictable offence, or a state offence that has a federal aspect.9

Parliamentary Joint Committee inquiry into unexplained wealth legislation

1.9 In July 2011, the Parliamentary Joint Committee on Law Enforcement (PJC-LE) initiated an inquiry into Commonwealth unexplained wealth legislation and arrangements. The PJC-LE's final report, tabled in March 2012, made 18 recommendations in relation to Commonwealth unexplained wealth arrangements,

which that committee considered would significantly enhance the effectiveness of those arrangements, if implemented.10

1.10 The Australian Government has accepted, either wholly or in part, 15 of the PJC-LE's recommendations.11 Schedule 1 of the Bill seeks to implement six of these recommendations in relation to the Commonwealth's unexplained wealth legislation.12

National firearm reforms

1.11 In the Bill's Second Reading Speech, the Minister explained that the proposed amendments to the Criminal Code in Schedule 2 of the Bill will complement a range of other measures to better regulate firearms in Australia, agreed to by the Standing Council on Police and Emergency Management. The initiatives outlined by the Minister include:

7 Proceeds of Crime Act 2002 (POC Act), section 20A.

8 POC Act, section 179B.

9 POC Act, paragraphs 179E(1)(a)-(b).

10 Parliamentary Joint Committee on Law Enforcement, Inquiry into Commonwealth unexplained wealth legislation and arrangements, March 2012, pp xiii-xvi.

11 Australian Government, Government response to the Parliamentary Joint Committee on Law Enforcement's Inquiry into Commonwealth unexplained wealth legislation and arrangements, February 2013, p. 1.

12 EM, p. 5. The Bill seeks to implement Recommendations 5, 9, 10, 11, 12, and (in part) Recommendation 13 of the PJC-LE's report.

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• establishing a National Firearms Register, to replace more than 30 different registers and databases currently used;

• nationwide rollout of the Australian Ballistics Identification Network;

• developing a National Firearms Identification Database for use by law enforcement agencies;

• specialised firearms training for Australian law enforcement officers;

• establishing a specialised Firearm Intelligence and Targeting Team within the Australian Customs and Border Protection Service (Customs);

• a national campaign on unlicensed firearms; and

• expansion of the Australian Crime Commission's Firearm Tracing Capability.13

Key provisions of the Bill

1.12 This section outlines the key provisions of the Bill which were commented on by submitters and witnesses during the inquiry.

Schedule 1 - amendments to the POC Act

1.13 The three main areas of Schedule 1 which attracted attention during the inquiry are the amendments that would: remove judicial discretion in relation to making unexplained wealth orders once certain criteria have been met; remove the ability for legal fees to be paid out of restrained assets; and enable the seizure of things relevant to unexplained wealth proceedings.

Removing judicial discretion in relation to unexplained wealth orders

1.14 The Bill seeks to amend the POC Act to remove the courts' general discretion to decide whether to make unexplained wealth restraining orders,14 preliminary unexplained wealth orders15 and unexplained wealth orders16 once relevant criteria are satisfied.17 Whereas the POC Act currently provides that a court 'may' make an order

13 The Hon Jason Clare MP, Minister for Justice, House of Representatives Hansard, 28 November 2012, pp 13661-13662.

14 Items 1 and 5 of Schedule 1 of the Bill (proposed new subsections 20A(1) and 20A(5) of the POC Act respectively).

15 Item 13 of Schedule 1 of the Bill (proposed new subsection 179B(1) of the POC Act).

16 Item 16 of Schedule 1 of the Bill (proposed new subsection 179E(1) of the POC Act).

17 The relevant criteria are outlined in the POC Act in: paragraphs 20A(1)(c)-(g) for unexplained wealth restraining orders; subsections 179B(1)-(2) for preliminary unexplained wealth orders; and paragraphs 179E(1)(a)-(b) for unexplained wealth orders. For example, an unexplained wealth order may be made once the court has made a preliminary unexplained wealth order in relation to a person, and the court is not satisfied that the person's wealth was not derived from a relevant Commonwealth, state or foreign indictable offence.

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in such circumstances, under the proposed amendments, a court 'must' make an order once the relevant criteria are met.

1.15 For all three types of orders, the removal of judicial discretion is limited to cases where the unexplained amount exceeds $100,000, in order to maintain the courts' discretion in cases where smaller amounts of wealth are unexplained.18

1.16 The EM emphasises the fact that the current discretion the courts have in relation to making unexplained wealth orders is in contrast to most other types of proceeds of crime orders, which a court must make if it is satisfied that the criteria have been met.19 Additionally, the courts can still refuse to make an unexplained wealth restraining order, or an unexplained wealth order, if 'it is not in the public interest to make the order'.20 A court may also revoke an unexplained wealth restraining order or a preliminary unexplained wealth order in certain circumstances, if it is 'in the interests of justice' to do so.21

1.17 These amendments seek to implement Recommendations 12 and 13 of the PJC-LE's report.22

Removing the ability for legal fees to be paid out of restrained assets

1.18 Item 2 of Schedule 1 repeals subsections 20A(3A) to (3C) of the POC Act, in order to remove the courts' ability to order that property which is the subject of a restraining order (under section 20A) may be disposed of for the purposes of meeting a person's reasonable legal fees.

18 See: Item 3 of Schedule 1 of the Bill (proposed subsection 20A(4) of the POC Act) in relation to restraining orders; Item 15 of Schedule 1 of the Bill (proposed new subsection 179B(4) of the POC Act) in relation to preliminary unexplained wealth orders; and Item 17 of Schedule 1 of the Bill (proposed new subsection 179E(6) of the POC Act) in relation to unexplained wealth orders.

19 EM, p. 23.

20 Item 3 of Schedule 1 of the Bill (proposed new subsection 20A(4) of the POC Act) and item 17 of Schedule 1 of the Bill (proposed new subsection 179E(6) of the POC Act).

21 See: POC Act, section 42 (in relation to restraining orders) and subsection 179C(5) (in relation to preliminary unexplained wealth orders). Subsection 179C(5) provides that a preliminary unexplained wealth order may be revoked either in the 'public interest' or in the 'interests of justice'.

22 Recommendation 12 of the PJC-LE's report recommended that judicial discretion to make restraining orders or preliminary unexplained wealth orders should be removed for cases over $100,000. Recommendation 13 recommended that judicial discretion to make unexplained wealth orders should be removed for cases over $100,000, subject to additional statutory oversight arrangements. The recommendation for additional oversight has been partially adopted by the government, through items 21-22 of Schedule 1 of the Bill. See: Australian Government, Government response to the Parliamentary Joint Committee on Law Enforcement's Inquiry into Commonwealth unexplained wealth legislation and arrangements, February 2013, pp 5-8.

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1.19 Section 179S of the POC Act provides that a restraining order may be made in respect of property which is subject to a person's effective control, even if they are not the legal owner of that property. Item 20 of Schedule 1 repeals section 179SA, which currently allows a court to order that property which is the subject of an order under section 179S may be disposed of for the purposes of meeting a person's reasonable legal fees.

1.20 These amendments implement recommendation 10 of the PJC-LE's report.23

Enabling the seizure of things relevant to unexplained wealth proceedings

1.21 Items 23-24 of Schedule 1 insert proposed new paragraphs 227(1)(h) and 228(1)(h) into the POC Act, in order to enable the seizure of things that are relevant to unexplained wealth proceedings during the execution of a search warrant granted by a magistrate.24 Item 28 of Schedule 1 would insert a proposed definition of 'thing relevant to unexplained wealth proceedings' into section 338 of the POC Act, namely:

thing relevant to unexplained wealth proceedings means a thing (including a thing in electronic form) as to which there are reasonable grounds for suspecting that it may be relevant for the purposes of initiating or

conducting proceedings under section 20A or Part 2-6.

1.22 The EM explains that the current search warrant provisions prevent officers from seizing some materials relevant to unexplained wealth proceedings:

For example, the current search warrant provisions would not necessarily allow the seizure of material relevant to ascertaining the total wealth of a person (such as evidence of a person's income or legitimately acquired property) or evidence of unlawful activities from which a person has derived wealth. Furthermore, officers are not able to collect evidence relating to summary offences and foreign offences, even though restraint action in unexplained wealth matters can be based on the commission of summary or indictable Commonwealth offences, or foreign indictable

offences.25

1.23 These proposed amendments implement recommendation 5 of the PJC-LE's report.26

23 EM, p. 18.

24 EM, p. 29.

25 EM, p. 29.

26 EM, p. 29.

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Schedule 2 - amendments to the Criminal Code

1.24 Proposed new aggravated firearm offences are provided for in Schedule 2 of the Bill.

Aggravated offences for dealing in 50 or more firearms and firearm parts

1.25 Schedule 2 would create several new aggravated firearm offences for dealing in 50 or more firearms or firearm parts in a six-month period. These offences relate to:

• cross-border disposal or acquisition of firearms or firearm parts within Australia, in the course of trade or commerce among the states and territories;27

• taking or sending firearms or firearm parts across state or territory borders within Australia;28

• importing prohibited firearms or firearm parts into Australia; 29 and

• exporting prohibited firearms or firearm parts from Australia. 30

1.26 These new aggravated offences would attract a penalty of life imprisonment or 7,500 penalty units, or both. The relevant basic offences attract a penalty of 10 years imprisonment or 2,500 penalty units, or both. The Minister stated in his Second Reading Speech that the penalties for these new aggravated offences 'will make the maximum penalty for trafficking in firearms the same as the maximum penalty for trafficking in drugs'.31

Conduct of the inquiry

1.27 The committee advertised the inquiry in The Australian newspaper on 5 December 2012. Details of the inquiry, including links to the Bill and associated documents, were placed on the committee's website at

www.aph.gov.au/senate_legalcon. The committee also wrote to 75 organisations and individuals, inviting submissions by 31 January 2013.

1.28 The committee received eight submissions, which are listed at Appendix 1. All submissions were published on the committee's website.

27 Item 7 of Schedule 2 of the Bill (proposed new subsection 360.2(2) of the Criminal Code).

28 Item 15 of Schedule 2 of the Bill (proposed new subsections 360.3(1A)-(1D) of the Criminal Code).

29 Item 21 of Schedule 2 of the Bill (proposed new subsections 361.2(2)-(6) of the Criminal Code).

30 Item 21 of Schedule 2 of the Bill (proposed new subsections 361.3(2)-(6) of the Criminal Code).

31 The Hon Jason Clare MP, Minister for Justice, House of Representatives Hansard, 28 November 2012, p. 13662.

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1.29 The committee held a public hearing for the inquiry on 7 February 2013 in Canberra. A list of witnesses who appeared at the hearing is at Appendix 2, and the Hansard transcript is available through the committee's website.

Acknowledgement

1.30 The committee thanks those submitters and witnesses who contributed to the inquiry.

Note on references

1.31 References to the committee Hansard are to the proof Hansard. Page numbers may vary between the proof and the official Hansard transcript.

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CHAPTER 2 KEY ISSUES

2.1 Submitters and witnesses commented on issues relating to the amendments proposed in both Schedules 1 and 2 of the Bill.

Schedule 1 - amendments to the Proceeds of Crime Act 2002 (POC Act)

2.2 Submitters expressed views on several issues in relation to Schedule 1, relating to: judicial discretion in making unexplained wealth orders; the removal of the ability for legal fees to be paid out of restrained assets; and enabling the seizure of things relevant to unexplained wealth proceedings.

Removing judicial discretion regarding the making of unexplained wealth orders

2.3 The Law Society of South Australia expressed concern at the removal of judicial discretion about whether to make restraining orders, preliminary unexplained wealth orders and unexplained wealth orders once relevant criteria are established:

The amendments compel a judicial officer to make orders sought by the applicant for an order. This is a fundamental inroad on judicial independence…[A] court may have good reason to decline to make an order. In those cases where it does, reasons for declining will be given. If the reasons are not acceptable to the State the decision may be appealed or reviewed. Viewed in this light, there can be no proper justification for the removal of the judicial discretion.1

2.4 Dr David Neal SC, from the Law Council of Australia (Law Council), also expressed concern about removing judicial discretion in the area of unexplained wealth proceedings:

[U]nlike other provisions in this legislation, where the prosecution would have to establish a link between these proceeds and some criminal activity, the criterion for unexplained wealth—as the term 'unexplained' carries with it—is a very nebulous sort of a concept, much broader than the other concepts such as: 'This is the proceeds of crime or it is in some way tainted'. That vagueness seems to us to argue in favour of the use of the word 'may', where there is a broader range of discretions, to avoid the situation where some unanticipated injustice might be worked.2

2.5 Conversely, the Police Federation of Australia (PFA) and the Australian Federal Police Association (AFPA) expressed support for this measure, deeming it appropriate that unexplained wealth proceedings be brought into line with other kinds of proceedings under the POC Act.3

1 Submission 8, pp 2-3.

2 Committee Hansard, 7 February 2013, p. 1.

3 Submission 2, p. 3.

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Use of the terms 'in the public interest' and 'in the interests of justice'

2.6 Liberty Victoria stated that, while some discretion has been removed, it 'takes comfort that the safeguards remain that orders must be in the public interest and in the interests of justice'.4 The Queensland Council for Civil Liberties (QCCL), however, noted that the term 'public interest' is not defined, and argued that the safeguard for the courts to refuse to make an order 'in the public interest' is insufficient.5

2.7 The Law Council raised additional concerns regarding the use of the terms 'in the public interest' and 'in the interests of justice' in the discretion retained by courts in relation to unexplained wealth orders.6 The Law Council noted that these two terms are used inconsistently across the different types of orders in the unexplained wealth provisions of the POC Act,7 and argued that their inclusion may be 'insufficient to avoid injustices' due to these inconsistencies:8

These different tests, which will assume increased significance in the absence of a general discretion to refuse to make the relevant orders, invite confusion and litigation about the scope of the court's authority to refuse to make an order or to revoke an order in difficult or unusual circumstances. They create the possibility that a person contesting an application may be more limited in their ability to resist the order sought, than a person seeking to revoke the order after it has been made. Further, they create the possibility that a court may be compelled to make an order first, before it can then consider whether such an order is in the 'interests of justice'.9

2.8 The Law Council suggested that the Bill should be amended such that an 'interests of justice' test or a combined 'interests of justice' and a 'public interest' test be adopted uniformly across the unexplained wealth provisions.10

2.9 The Department argued for the retention of both terms in the POC Act as currently envisaged under the Bill, noting that the 'public interest' test is used in several places across the POC Act in relation to making certain orders, while the 'interests of justice test' is used in relation to revoking certain orders.11 The Department explained that it is 'appropriate to retain references to both tests as

4 Submission 7, p. 1.

5 Submission 6, p. 4.

6 Supplementary Submission 3, pp 3-6.

7 For example, a court may refuse to make an unexplained wealth order or an unexplained wealth restraining order if it is not in the 'public interest' to make the order; however, a court may revoke a preliminary unexplained wealth order or an unexplained wealth restraining order in certain circumstances if it is 'in the interests of justice' to do so. See: Law Council of Australia, Supplementary Submission 3, pp 3-5.

8 Supplementary Submission 3, p. 5.

9 Supplementary Submission 3, p. 6.

10 Supplementary Submission 3, p. 6.

11 Attorney-General's Department, Response to questions on notice provided on 27 February 2013, pp 6-7.

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they involve different considerations', and that the 'interests of justice' test ensures that a court has regard to matters which are relevant to the administration of justice when considering a revocation application.12

Removing the courts' discretion to allow legal expenses to be paid out of restrained assets

2.10 The PFA and the AFPA expressed support for these amendments, stating its view that assets subject to unexplained wealth restraining orders should not be able to be used to pay legal expenses.13 Several other submitters and witnesses, however, expressed opposition to these proposed amendments.14

Effectiveness of the current provisions

2.11 The EM offers the following rationale for the removal of an individual's ability to meet legal expenses through restrained assets:

The ability of a person to dispose of restrained property to meet their legal costs weakens the effectiveness of the unexplained wealth provisions by allowing the wealth suspected to have been unlawfully acquired to be used to contest proceedings. This may lead to fewer assets being available for confiscation if an unexplained wealth order is successful and is likely to cause more protracted litigation.15

2.12 The Law Council contested the assertion that the current ability of the courts to make orders for legal costs to be paid from restrained assets undermines the effectiveness of the unexplained wealth provisions in the POC Act. It argued that, as the current provisions relating to legal costs are yet to be tested (having only been introduced to the POC Act in 2010), there is no evidence that they do, in fact, have the effect of shrinking the asset base which could otherwise be drawn from in making an unexplained wealth order.16

2.13 The Law Council also noted that individuals are not automatically entitled to use restrained assets to pay legal costs under the current system, because:

• a person will only have access to their restrained assets to meet legal costs where the court so orders;

• the court may require that a costs assessor certify that legal expenses have been properly incurred before permitting the payment of expenses from

12 Attorney-General's Department, Response to questions on notice provided on 27 February 2013, pp 6-7.

13 Submission 2, p. 3.

14 Law Council of Australia, Submission 3, pp 4-8; Queensland Council for Civil Liberties, Submission 6, pp 2-3; Liberty Victoria, Submission 7, pp 2-3; Law Society of South Australia, Submission 8, p. 3; Dr David Neal SC, Law Council of Australia, Committee Hansard, 7 February 2013, p. 2.

15 EM, p. 18.

16 Submission 3, p. 4; Ms Helen Donovan, Law Council of Australia, Committee Hansard, 7 February 2013, p. 3.

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restrained funds, and may make any further or ancillary orders it considers appropriate; and

• where an unexplained wealth order is made against a person which cannot be completely met from restrained assets because some of those assets have been released to meet legal expenses, the Commonwealth can still pursue the person who is subject to the order for any remaining amount.17

2.14 The Law Council argued that a court is 'highly unlikely' to make an order allowing legal costs to be paid from restrained assets where it can be demonstrated that a person has the ability to meet their expenses from unrestrained assets.18

Harmonisation with other kinds of proceedings under the POC Act

2.15 The EM states that this amendment 'will harmonise provisions relating to the payment of legal expenses for unexplained wealth cases with those for other proceedings under the POC Act'.19 The Law Council argued that such harmonisation is unnecessary, as unexplained wealth proceedings have a number of unique features, including a lower threshold before an individual's assets can be restrained, and a reverse onus of proof:

There is no move to harmonise the thresholds that must be met before assets may be restrained for different types of proceedings under the [POC Act] or to harmonise the matters of which the court must be satisfied before different types of final orders are made. Such a move towards harmonisation within the [POC Act] would be illogical because the different types of proceedings are directed towards different circumstances and scenarios. So too, it is also misguided to suggest that the provisions relating to the payment of legal expenses should be harmonised when they relate to different types of proceedings, which place respondents in different positions.20

Access to appropriate representation

2.16 The EM states that people who are subject to POC Act proceedings may seek legal representation through legal aid if their unrestrained assets are not sufficient to meet legal costs, to 'ensure that they are appropriately represented, are not

disadvantaged and continue to be equal before courts and tribunals'.21

2.17 Submitters argued that despite potential access to legal aid services, individuals may in many cases be unable to mount an appropriate defence in unexplained wealth proceedings, and may have their choice of legal representative inappropriately limited. For example, the Law Council argued:

17 Submission 3, p. 5. See also: Liberty Victoria, Submission 7, p. 2.

18 Submission 3, p. 5.

19 EM, p. 18.

20 Submission 3, p. 6.

21 EM, p. 7.

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Proceeds of crime litigation can be complex, and significant resources are expended by the law enforcement agencies in identifying targets, gathering evidence and preparing a matter for court. To contest such proceedings, respondents must also expend resources, including potentially on their own expert witnesses. However, respondents reliant on legal aid may find themselves unduly restricted in this regard.22

2.18 Dr Neal from the Law Council elaborated at the committee's public hearing:

The idea that there is any genuine equality in saying that these people can depend on legal aid to run litigation of this complexity is really not confronting the reality of life in the courts at this stage…It is just unrealistic to think that the cases which have commercial and financial complexity to them can be done within the confines of legal aid rates. And given the nebulous nature of the unexplained wealth provisions, it seems particularly unreasonable to say: 'Your asset base is suspicious. We're going to stop you from using any of it to prove that it's not.'23

2.19 QCCL agreed, arguing that proceedings involving asset confiscation are often very time-consuming and complex, and require 'a higher level of skill than might otherwise apply in civil litigation'.24

2.20 Dr Neal also argued that many respondents may not meet the relevant legal aid means test in order to qualify for legal aid, yet still not have enough unrestrained assets to mount a proper defence:

The legal aid means tests are so low in a number of jurisdictions that, for instance, in New South Wales, the poverty line is the cut off for legal aid. There will be numbers of these people who, if they have some assets left, simply will not qualify for legal aid but certainly would not have sufficient assets to defend or run the proof of how they came by all of this money.25

2.21 Liberty Victoria argued that in cases where legal aid is not granted, respondents may become self-represented, at 'a significant cost to the resources of the Courts and to taxpayers'.26 Consequently, Liberty Victoria argued that the amendments in the Bill 'may actually result in more cost being incurred to the public due to the limited and valuable resources of the Legal Aid Commission and the Courts'.27

2.22 Finally, the Law Council noted that, as legal aid costs incurred in the representation of individuals whose property is restrained are reimbursed from the

22 Submission 3, p. 7. See also: Law Society of South Australia, Submission 8, p. 3; Liberty Victoria, Submission 7, pp 2-3.

23 Committee Hansard, 7 February 2013, pp 2 and 4.

24 Submission 6, p. 3.

25 Committee Hansard, 7 February 2013, p. 2.

26 Submission 7, p. 2.

27 Submission 7, pp 2-3.

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Commonwealth's Confiscated Assets Account, the revenue gained by proceeds of crime is still diminished in the model proposed by the Bill.28

Departmental response

2.23 The Department made several points in response to the concerns raised by submitters and witnesses about removing the courts' discretion. It noted that the rationale for removing the ability to use restrained assets is not 'harmonisation for harmonisation's sake', but rather is based on lessons learned from the experience of the Proceeds of Crime Act 1987 (POC Act 1987):

Under the original [POC Act 1987], restrained assets could be accessed for the purposes of meeting legal expenses…In essence, defendants would actively frustrate [proceeds of crime] proceedings, either through frivolous or unreasonable legal defences to dissipate restrained funds, or using legitimate avenues to reclaim the restrained assets (using money laundering type practices)…[T]he amendments [in the Bill] are intended to ensure that the experience in proceeds of crime proceedings from 1987 to 2002 is not replicated in proceedings for unexplained wealth matters.

To date, no unexplained wealth proceedings have been commenced. As such, it is not possible to point to cases in which respondents have sought to dissipate restrained assets to meet the costs of legal expenses related to [POC Act] proceedings. However, there is clear evidence that similar provisions were abused under [the POC Act 1987] and there is nothing to suggest that similar dissipation of assets will not occur under the unexplained wealth provisions.29

2.24 The Department also argued that unexplained wealth proceedings are not, in fact, fundamentally different to other proceedings under the POC Act, pointing out that several other types of proceedings under the POC Act, such as proceedings where a person suspected of committing a serious offence has their assets restrained, also place the onus of proof on the respondent in relation to restrained property.30

2.25 Further, retaining the ability for legal costs to be met from restrained assets may affect whether unexplained wealth proceedings can be brought forward at all:

[T]he ability to use restrained assets to meet a person's legal costs is a significant deterrent to the use of the unexplained wealth provisions, as it is necessary to take into account that a large proportion of the restrained assets may be dissipated prior to their confiscation in deciding whether it is in public interest to commence proceedings.31

28 Submission 3, p. 5.

29 Attorney-General's Department, Response to questions on notice provided on 27 February 2013, Attachment A, p. 1.

30 Attorney-General's Department, Response to questions on notice provided on 27 February 2013, Attachment A, p. 7.

31 Attorney-General's Department, Response to questions on notice provided on 27 February 2013, Attachment A, p. 1.

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2.26 In relation to whether respondents would have their choice of legal representation restricted, a representative from the Department noted that similar concerns had been raised about other proceeds of crime proceedings:

[I]nitially, with proceeds of crime, restrained assets could be used to fund legal expenses, and people justified that by saying it would be unfair if people were not allowed to choose their own legal representatives and to defend themselves to the full extent of their assets…[T]he experience has been that the ability of people to defend themselves in proceeds of crime actions has been ample and sufficient and adequate under the [current] legal aid arrangements…[W]e have seen those concerns before with respect to proceeds of crime and they have not actually been borne out in practice.32

2.27 The Department also highlighted that the Parliamentary Joint Committee on Law Enforcement (PJC-LE) inquiry into unexplained wealth arrangements had examined other options for dealing with the payment of legal costs in unexplained wealth proceedings, including: the introduction of a cap on fees for legal costs in those proceedings; and making greater use of independent cost assessors.33 The PJC-LE ultimately recommended that the model proposed in the Bill should be adopted.

Allowing officers to seize things relevant to unexplained wealth proceedings

2.28 Submitters and witnesses commented on the proposed amendments to the POC Act that would allow officers to seize things relevant to unexplained wealth proceedings when carrying out a search warrant. The PFA and the AFPA supported these provisions, as recommended by the PJC-LE.34

2.29 The Law Council, however, argued that these powers are too broad:

[U]nexplained wealth proceedings essentially concern the entirety of a person's financial affairs over their lifetime. There is no aspect of a person's income, expenditure, investments and business dealings (and potentially that of their family and close associates) which is not of possible relevance…[T]he amendments in their current form will mean that there are no practical limits placed on the type of information that may be seized in

the course of executing a search warrant under the [POC Act].35

32 Mr Iain Anderson, Attorney-General's Department, Committee Hansard, 7 February 2013, p. 8.

33 Attorney-General's Department, Response to questions on notice provided on 27 February 2013, Attachment A, pp 4-6.

34 Submission 2, p. 3.

35 Submission 3, p. 8.

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Schedule 2 - amendments to the Criminal Code Act 1995 (Criminal Code)

2.30 Submitters that commented on Schedule 2 of the Bill were generally supportive of the new firearms offences created by the proposed amendments.36

2.31 The NSW Government commented on two issues relating to the four aggravated firearm trafficking offences proposed in the Bill.

Threshold number of firearms or firearm parts for aggravated trafficking offences

2.32 The NSW Government argued in its submission that the thresholds for the new aggravated firearm offences created by the Bill (trafficking of 50 or more firearms or firearm parts within a six-month period) should be significantly lowered to ensure that prosecutions can be made under these offences:

In prosecutions commenced for the ongoing sale of firearms in NSW since 2008, the maximum number of firearms involved was 25, and the average was seven. These were sold over a period of twelve months, rather than six months. None of these cases would have been captured as an aggravated offence under the proposed new Commonwealth provisions.

NSW is concerned that, unless the threshold for aggravated offences is set at a substantially lower level than 50 firearms, the provisions may not result in any prosecutions. The period should also be extended from six months to 12 months to ensure that the offence captures serious cases.37

2.33 The EM notes that the threshold quantity of 50 firearms or firearm parts 'represents a significantly higher threshold than those in existing State or Territory offences, reflecting the severity of the penalties proposed' (life imprisonment).38

2.34 At the committee's public hearing, a departmental representative explained the rationale for including a six-month time period for the aggravated offences, and stated that this period could potentially be extended:

Six months is aimed at capturing a process where someone seeks to structure what they are doing—the trafficking arrangement—where they are sending small consignments on a regular basis. Six months would be sufficient to capture a number of shipments through international cargo channels, for example. So, if someone is engaged in this behaviour, six months should be adequate to prove the offence, but it could always be extended to 12 [months].39

36 Australian Federal Police Association and Police Federation of Australia, Submission 2, p. 3; Australian Customs and Border Protection, Submission 5, pp 1 and 4; Australian Crime Commission, Submission 1, p. 2.

37 Submission 4, p. 2.

38 EM, p. 43.

39 Mr Iain Anderson, Attorney-General's Department, Committee Hansard, 7 February 2013, p. 11.

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2.35 Customs expressed the view that the six-month time period is appropriate:

The inclusion of a six-month period for the accumulation of firearms or parts of firearms to make up the 50 or more threshold seems reasonable given the severity of the penalties proposed for the aggravated offences…It is essential that these offences only apply to serious examples of offending.40

Formulation of aggravated trafficking offences - number of firearm parts

2.36 The aggravated offences will apply where it can be shown that the individual has been involved in the trafficking of either:

(i) 50 or more firearms;

(ii) 50 or more firearm parts that might be used to constitute one or more firearms;

(iii) a combination of firearms and firearm parts such that the sum of the actual firearms and the firearms that might be constituted by the parts is 50 or more.41

2.37 The NSW Government expressed concern about this formulation:

As the Bill is currently drafted, it appears possible for a person who commits a trafficking offence involving parts which combine to make up only a few whole firearms to face the same penalty as someone who commits the same offence involving 50 whole firearms.

…Subsection (ii) could…apply a much lower threshold than subsection (i) in terms of numbers of whole firearms. This inconsistency is undesirable and could result in outcomes which are disproportionate to the criminality involved.42

2.38 A departmental representative provided the reason why the Bill has been drafted in this way:

It is drafted with an emphasis on parts of firearms being treated as parts that could constitute a firearm. For example, if someone sends through 50 barrels of firearms, that can actually constitute 50 firearms in itself.

[I]t is 50 firearms, 50 parts of firearms or a combination of parts and whole firearms that could constitute 50 or more firearms…[T]hat is drafted by the

40 Submission 5, p. 4.

41 The same formulation is used for all four aggravated offences. See: Item 7 of Schedule 2 of the Bill (proposed new paragraph 360.2(2)(d) of the Criminal Code); Item 15 of Schedule 2 of the Bill (proposed new paragraph 360.3(1A)(f) of the Criminal Code); and Item 21 of Schedule 2 of the Bill (proposed new paragraphs 361.2(2)(d) and 361.3(2)(d) of the Criminal Code).

42 Submission 4, p. 3.

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Office of Parliamentary Counsel; we worked with them in the drafting and we believe that it is unambiguous.43

Committee view

2.39 The committee considers that the Bill contains a reasonable set of measures to assist the fight against serious and organised crime in Australia. The committee's specific comments on the proposed amendments are as follows.

Amendments to the Proceeds of Crime Act 2002 (POC Act)

2.40 The committee supports the proposed amendments to the POC Act in relation to unexplained wealth proceedings. The committee notes that these legislative amendments implement the recommendations of the Parliamentary Joint Committee on Law Enforcement (PJC-LE), which examined these issues at length in its report into the Commonwealth's unexplained wealth legislation and arrangements.

2.41 In relation to removing the courts' discretion to make orders in cases where the unexplained amount is over $100,000, the committee considers that the safeguards retained in the Bill are sufficient to warrant this measure's inclusion in the POC Act. These safeguards include the court's initial function in determining whether the relevant criteria have been satisfied to make an order, as well as the ability of a court to refuse to make an unexplained wealth order or restraining order where it is not in the public interest, and to revoke a restraining order or preliminary unexplained wealth order if it is in the interests of justice to do so.

2.42 The committee is also satisfied with the approach proposed in the Bill to remove the ability for legal fees to be paid out of restrained assets, which will make the treatment of legal fees consistent across the POC Act. The committee has not received any evidence from Legal Aid Commissions that the existing arrangements in relation to other proceeds of crimes matters are unsatisfactory, and considers that the potential for the dissipation of restrained funds in unexplained wealth proceedings, as occurred in similar types of proceedings under the POC Act 1987, should be removed.

2.43 The committee agrees with the policy decision to enable the seizure of things relevant to unexplained wealth proceedings in the execution of a search warrant, where this has been approved by a magistrate. While this may enable a range of materials to be seized in some circumstances, the committee is of the view that this is appropriate due to the serious nature of the activity unexplained wealth measures are designed to target.

2.44 Having stated its support for these proposed changes, the committee acknowledges that unexplained wealth provisions are still new in Commonwealth law, and hence require close monitoring in the coming years to ensure that they are operating effectively. Under the changes proposed in the Bill, the PJC-LE will have ongoing oversight of the operation of unexplained wealth provisions in the POC Act. The committee considers that this oversight should ensure that any issues that arise in

43 Mr Iain Anderson, Attorney-General's Department, Committee Hansard, 7 February 2013, p. 11.

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relation to the operation of the legislation are swiftly brought to the attention of the parliament.

Amendments to the Criminal Code

2.45 The committee is supportive of the measures included in the Bill to create stronger penalties for trafficking in large numbers of firearms or firearm parts. The committee agrees that, given the severity of the penalties associated with the new proposed aggravated offences, a high threshold needs to be set in order to trigger these offences. As such, the committee considers that 50 firearms or firearm parts over a six-month period seems reasonable.

2.46 The committee is satisfied with the Department's evidence that the drafting relating to the number of firearms or firearm parts has been carefully considered, and agrees with the approach taken in the Bill.

Recommendation 1

2.47 The committee recommends that the Senate pass the Bill.

Senator Trish Crossin

Chair

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ADDITIONAL COMMENTS BY THE AUSTRALIAN GREENS

1.1 The Crimes Legislation Amendment (Organised Crime and Other Measures) Bill 2012 (the Bill) has two main functions: Schedule 1 relates to unexplained wealth proceedings and Schedule 2 addresses firearms trafficking.

1.2 The Australian Greens generally agree with the report on the Bill from the majority of the Legal and Constitutional Affairs Committee.

1.3 However, we have some concerns about Schedule 1 of the Bill, insofar as it purports to harmonise provisions relating to the payment of legal expenses for unexplained wealth.

1.4 Item 2 of Schedule 1 repeals subsections 20A(3A)-(3C), and section 179SA, of the Proceeds of Crime Act 2002 (POC Act) in order to remove the court's discretion to allow a person who is subject to unexplained wealth proceedings to pay his or her legal expenses using the restrained assets.

1.5 A substantial number of those who made submissions to the inquiry, including the Law Council of Australia, the Queensland Council for Civil Liberties, Liberty Victoria and the Law Society of South Australia, raised concerns about this issue.

1.6 Although the Explanatory Memorandum (EM) to the Bill states that this amendment 'will harmonise provisions relating to the payment of legal expenses for unexplained wealth cases with those for other proceedings under the POC Act', the Australian Greens are not convinced that this is necessary and are concerned that it will unduly compromise an individual's ability to defend an unexplained wealth action.

1.7 As argued by the Law Council, unexplained wealth proceedings have a number of unique features, which would justify a different approach to other proceedings in the POC Act:

In the Law Council's view it is appropriate that people subject to unexplained wealth proceedings might have access to restrained property to meet their legal fees, even though people subject to other types of proceedings under the [POC Act] do not. The unexplained wealth proceedings are unique in nature. First, the threshold that must be met before a person's assets may be restrained is lower in the case of unexplained wealth proceedings. Further, once a preliminary unexplained wealth order has been secured, the burden is placed on the respondent to demonstrate that their wealth and assets have been legitimately derived, rather than on the state to demonstrate otherwise. Therefore, to avoid being ordered to pay the Commonwealth a specified amount, the respondent must

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do more than meet or counter the state's case, but must prepare and present his or her own positive case, supported by evidence.1

1.8 Should these sections be repealed, an individual subject to unexplained wealth proceedings will be unable to use their restrained assets to pay for legal representation. However, unexplained wealth proceedings are complex matters, likely to require legal counsel as well as instructing solicitors and forensic accounting experts.

1.9 Because of strict eligibility criteria, and restrictions on how legal aid funding can be used, concerns were raised by submitters that legal aid is likely to be inadequate in such a situation.

1.10 The Law Council of Australia's submissions argued that legal aid funding is inadequate for those subject to unexplained wealth proceedings, in terms of meeting eligibility requirements and accessing the kind of legal costs needed to defend such an action. It concluded that no reliable assurance can be given that a person facing unexplained wealth litigation will be able to access a level of legal representation which enables them to fairly contest the proceedings.

1.11 These concerns would be addressed by preserving the court's discretion to allow access to restrained funds for the purposes of legal representation.

1.12 In our view, the Bill does not establish cogent grounds for removing the court's discretion. There is no evidence that the current discretion undermines the effectiveness of the POC Act's unexplained wealth provisions. As acknowledged by

the Attorney General's Department, the current provisions have not been tested:

To date, no unexplained wealth proceedings have been commenced. As such, it is not possible to point to cases in which respondents have sought to dissipate restrained assets to meet the costs of legal expenses related to [POC Act] proceedings.2

1.13 In any event, the Law Council pointed out that the right to use restrained funds for legal costs is not automatic, as the court must exercise discretion to allow this. This includes the ability for a court to order that a costs assessor must certify how legal expenses were incurred, before permitting payment from restrained funds.

1.14 The Australian Greens recommend that the Bill preserve the sections of the POC Act that provide the court with discretion to allow a person who is subject to unexplained wealth proceedings to pay his or her legal expenses using the restrained assets.

Senator Penny Wright Australian Greens

1 Law Council of Australia, Submission 3, p.3.

2 Responses to questions on notice provided by the Attorney-General's Department on 27 February 2013, Attachment A, p.1.

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APPENDIX 1

SUBMISSIONS RECEIVED

Submission Number Submitter

1 Australian Crime Commission

2 Australian Federal Police Association and Police Federation of

Australia

3 Law Council of Australia

4 New South Wales Government

5 Australian Customs and Border Protection Service

6 Queensland Council for Civil Liberties

7 Liberty Victoria

8 The Law Society of South Australia

ADDITIONAL INFORMATION RECEIVED

1 Responses to questions on notice provided by the Attorney-General's Department on 27 February 2013

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APPENDIX 2

WITNESSES WHO APPEARED BEFORE THE COMMITTEE

Canberra, 7 February 2013

ANDERSON, Mr Iain, First Assistant Secretary, Criminal Justice Division, Attorney-General's Department

DONOVAN, Ms Helen, Co-Director Criminal Law and Human Rights, Law Council of Australia

INVERARITY, Ms Tara, Principal Legal Officer, Criminal Law and Law Enforcement Branch, Attorney-General's Department

McCARTNEY, Commander Ian, Manager Criminal Assets, Australian Federal Police

MILLER, Ms Andrea, Acting Assistant Director, Border Management and Crime Prevention Branch, Attorney-General's Department

NEAL, Dr David, SC, Member of Criminal Law Committee, Law Council of Australia

SENGSTOCK, Mrs Elsa, Coordinator, Legislation Program, Australian Federal Police

VILES, Mr Ross, Director Operations, Investigations Branch, Australian Customs and Border Protection Service

WOODFORD-SMITH, Mr Kingsley, National Manager, Investigations Branch, Australian Customs and Border Protection Service

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The Senate

Legal and Constitutional Affairs

Legislation Committee

Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2013

June 2013

163

© Commonwealth of Australia

ISBN: 978-1-74229-885-6

This document was produced by the Senate Legal and Constitutional Affairs Committee secretariat and printed by the Senate Printing Unit, Department of the Senate, Parliament House, Canberra.

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iii

MEMBERS OF THE COMMITTEE

Members

Senator Patricia Crossin, Chair, ALP, NT

Senator Gary Humphries, Deputy Chair, LP, ACT

Senator Sue Boyce, LP, QLD

Senator Mark Furner, ALP, QLD

Senator Louise Pratt, ALP, WA

Senator Penny Wright, AG, SA

Participating Members

Senator Nick Xenophon, IND, SA

Secretariat

Ms Julie Dennett Committee Secretary

Ms Monika Sheppard Senior Research Officer

Ms Elise Williamson Administrative Officer

Suite S1.61 Telephone: (02) 6277 3560

Parliament House Fax: (02) 6277 5794

CANBERRA ACT 2600 Email: legcon.sen@aph.gov.au

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TABLE OF CONTENTS

MEMBERS OF THE COMMITTEE ............................................................. iii

RECOMMENDATION ................................................................................... vii

CHAPTER 1 ........................................................................................................ 1

INTRODUCTION .................................................................................................... 1

Purpose of the Bill .................................................................................................. 1

Background to the Bill ............................................................................................ 1

Conduct of the inquiry ............................................................................................ 2

CHAPTER 2 ........................................................................................................ 3

KEY ISSUES ............................................................................................................. 3

Duplication of existing offences in the Criminal Code .......................................... 3

Bill's formulation of offences in proposed new section 474.40 ............................. 4

Committee view ...................................................................................................... 8

DISSENTING REPORT BY SENATOR XENOPHON ............................... 11 History of the Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2013 ............................................................................................................... 12

APPENDIX 1 ..................................................................................................... 15

SUBMISSIONS RECEIVED ................................................................................. 15

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vii

RECOMMENDATION

Recommendation 1

2.28 The committee recommends that the Senate not pass the Bill.

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CHAPTER 1 INTRODUCTION

1.1 On 26 February 2013, the Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2013 (Bill) was introduced into the Senate as a private senator's bill by Senator Nick Xenophon.1 On 28 February 2013, the Senate referred the Bill to the Senate Legal and Constitutional Affairs Legislation Committee (committee) for inquiry and report by 27 June 2013.2

Purpose of the Bill

1.2 The Bill seeks to amend the Criminal Code Act 1995 (Cth) (Criminal Code), to make it an offence for a person who is over 18 years of age to misrepresent their age in online communications to a person they reasonably believe to be under 18 years of age, for the purpose of encouraging a physical meeting or with the intent of committing an offence.3

1.3 The key provision of the Bill is proposed new section 474.40 (item 1 of Schedule 1), which would be inserted at the end of Division 474 (Telecommunications offences) of the Schedule to the Criminal Code.

1.4 Proposed new section 474.40 would create two offences for a person over 18 years of age (the 'sender') to intentionally misrepresent their age using a carriage service to a person who is, or who the sender believes to be, under 18 years of age (the 'recipient'):

• for the purpose of encouraging the recipient to physically meet with the sender (or any other person) (subsection 474.40(1)); or

• with the intention of committing an offence, other than an offence under proposed new section 474.40 (subsection 474.40(2)).

1.5 Both offences will be punishable by a term of imprisonment: five years where the intent was to encourage a physical meeting; and eight years where the intent was to commit an offence.

Background to the Bill

1.6 In February 2010, Senator Xenophon introduced the Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2010 (2010 Bill) into the Senate.4 The stated purpose of the 2010 Bill was similar to that of the current Bill,

1 Senate, Journals of the Senate, No. 134-26 February 2013, p. 3661.

2 Senate, Journals of the Senate, No. 136-28 February 2013, pp 3690-3691.

3 Explanatory Memorandum (EM), p. 2.

4 Senate, Journals of the Senate, No. 107-3 February 2010, p. 3117.

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the notable difference being that the 2010 Bill did not include an intention to encourage a physical meeting or commit an offence, as formulated in the current Bill.5

1.7 The 2010 Bill was referred to the committee for inquiry and report6 and, in June 2010, the committee recommended that the Senate should not pass the bill.7 The inquiry had highlighted a number of concerns with the 2010 Bill, such as the failure to incorporate an element of intent and the potential duplication of existing Criminal Code offences.8

1.8 Upon introduction of the current Bill, Senator Xenophon stated that the proposed legislation would close an important legal 'loophole', as there is no reason for an adult to knowingly misrepresent their age to someone they believe to be under 18 years of age. Further:

I previously attempted to address this serious issue in 2010 with the earlier version of this bill. I acknowledge the concerns raised in relation to that bill, and I have modified this version to ensure there are no unintended consequences of enforcing this law. Instead, this bill creates offences specifically aimed at the circumstances - an adult lying to a minor about their age to facilitate a meeting or to make themselves seem 'more approachable' - that need to be addressed.9

Conduct of the inquiry

1.9 The committee advertised the current inquiry in The Australian on 6 March 2013 and 27 March 2013. Details of the inquiry, including links to the Bill and associated documents, were placed on the committee's website at www.aph.gov.au/senate_legalcon. The committee also wrote to 64 organisations and

individuals, inviting submissions by 26 April 2013. Submissions continued to be accepted after that date.

1.10 The committee received nine submissions, which are listed at Appendix 1. All submissions were published on the committee's website. The committee thanks those organisations and individuals who made submissions. No public hearings were held for this inquiry.

5 Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2010, EM, p. 2.

6 Senate, Journals of the Senate, No. 108-4 February 2010, pp 3143-3144.

7 Senate Legal and Constitutional Affairs Legislation Committee, Inquiry into the Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2010, June 2010, p. 11 (Recommendation 1).

8 Senate Legal and Constitutional Affairs Legislation Committee, Inquiry into the Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2010, June 2010, p. 10.

9 Senate Hansard, 26 February 2013, p. 926.

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CHAPTER 2

KEY ISSUES

2.1 The majority of submissions received by the committee identified specific concerns with the Bill. The key concerns identified by submitters were:

• duplication of existing offences in the Criminal Code Act 1995 (Cth) (Criminal Code); and

• the Bill's formulation of offences in proposed new section 474.40. 1

Duplication of existing offences in the Criminal Code

2.2 The Criminal Code contains a number of offences, which criminalise online communications with children where there is evidence of intention to cause harm to a child: for example, section 474.26 (the offence of procurement), section 474.27

(the offence of grooming), and section 474.14 (the offence of using a

telecommunications network with intention to commit a serious offence).

2.3 Subsection 474.26(1) provides:

(1) A person (the sender) commits an offence if:

(a) the sender uses a carriage service to transmit a communication to another person (the recipient); and

(b) the sender does this with the intention of procuring the recipient to engage in sexual activity with the sender; and

(c) the recipient is someone who is, or who the sender believes to be, under 16 years of age; and

(d) the sender is at least 18 years of age.

Penalty: Imprisonment for 15 years.

2.4 Subsection 474.27(1) provides:

(1) A person (the sender) commits an offence if:

(a) the sender uses a carriage service to transmit a communication to another person (the recipient); and

(b) the sender does this with the intention of making it easier to procure the recipient to engage in sexual activity with the sender; and

1 See: Attorney-General's Department (AGD), Submission 1, pp 3-5; National Children's and Youth Law Centre, Submission 4, pp 2-3; Law Society of South Australia, Submission 5, p. 2; ACT Government, Submission 6, pp 1-2; Law Council of Australia, Submission 8, p. 1; Law Society of Western Australia, Submission 9, p. 1.

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(c) the recipient is someone who is, or who the sender believes to be, under 16 years of age; and

(d) the sender is at least 18 years of age.

Penalty: Imprisonment for 12 years.

2.5 A number of submitters referred to these existing offences in the Criminal Code, and stated that these provisions already capture the behaviour sought to be covered by the new offences proposed in the Bill.2 As the Attorney-General's Department (Department) explained:

[T]he existing online grooming and procurement offences in the Criminal Code apply where an adult has communicated with a child online with the intention of procuring or making it easier to procure the child to engage in sexual activity. This would cover circumstances in which an adult misrepresented their age in an online communication with a child for the purpose of encouraging a physical meeting with that child with the intention of engaging, or making it easier to engage, in sexual activity during the physical meeting.3

2.6 The Law Society of South Australia agreed:

[T]he Society is of the view that s 474.40(1) is unnecessary. The Criminal Code already contains grooming offences which more appropriately criminalise conduct of a criminal nature (eg. ss 474.26 and 474.27).4

Bill's formulation of offences in proposed new section 474.40

2.7 The formulation of the offences in proposed new section 474.40 were of most concern to submitters, who argued that the scope of the proposed provision is too wide and the proposed offences are flawed.

Scope of the proposed provision

2.8 Submitters commented on two separate aspects of each proposed offence: paragraphs 474.40(1)(b) and 474.40(2)(b), which contain a fault element (that is, the requirement of an intention to misrepresent one's age); and paragraphs 474.40(1)(d) and 474.40(2)(d), which require that the recipient of a communication is, or is believed by the sender to be, under 18 years of age.

2 See, for example: ACT Government, Submission 6, p. 2; Law Society of Western Australia, Submission 9, p. 1.

3 Submission 1, p. 4. Also see p. 5 (in relation to section 474.14 of the Criminal Code Act 1995 (Cth) (Criminal Code) and proposed new subsection 474.40(2)).

4 Submission 5, p. 4.

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Intention to misrepresent one's age

2.9 The Department explained that, because only an intention to misrepresent and not an actual misrepresentation of age is required, the proposed offence is too broad. Accordingly, an actual misrepresentation of age would be preferable to limit the application of the proposed provision.5

Recipient is, or is believed to be, under 18 years of age

2.10 In relation to paragraph (d) of the proposed offences, the Law Society of South Australia argued that the offences must only be made out where the sender believes the recipient is under 18 years of age because otherwise non-criminal conduct would also be captured:

By this we refer to criminal liability being created by establishing only that the recipient is under 18. Clearly in this case the gravamen of the criminality would be missing where the sender believed that the recipient was 18 or over. An example may be where a female recipient represents her age to be 21. The sender, to encourage a meeting or the continuation of a relationship, may consider that the recipient would lose interest if she was aware he was younger than her. His age could be 19, but he misrepresents it as 23. The fact the recipient is 17 can never be to the point because the sender at all times believed, on reasonable grounds, that she was [21].6

2.11 Further:

Offence provisions are only meant to capture conduct which is criminal in nature. It is no answer to this to suggest that the [proposed offences make] criminal any misrepresentation as to age because that ignores the purpose for which the [offences are proposed to be] created (to protect children from online predators who take advantage of a misrepresentation as to age to set up a meeting with a view to commit an offence).7

2.12 The Department informed the committee that the element of belief on the part of the sender is not consistent with existing offences in the Criminal Code which are directed toward online communications with children. In particular, the Department explained that the procurement and grooming offences capture communications with persons under 16 years of age, taking into account the legal age of consent throughout Australia (between 16 and 17 years):

It is a long-held Commonwealth policy that an age limit of 16 years strikes the appropriate balance between the need to protect vulnerable persons from sexual exploitation and the need to allow for the sexual autonomy of young people.8

5 Submission 1, p. 3. Also see: Law Society of South Australia, Submission 5, p. 3.

6 Submission 5, p. 4.

7 Submission 5, p. 4.

8 Submission 1, p. 4. Also see: Law Society of Western Australia, Submission 9, p. 1.

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2.13 The Department indicated that the proposed new offences would criminalise a misrepresentation of age to a person under 18 years of age, even if consensual sexual activity between the sender of the communication and its recipient would not otherwise be a crime:

For example, a 19 year old saying he or she is 18 years old in order to enter into a relationship with a 17 year old would be an offence under the Bill, even though a 19 year old may legally engage in consensual sexual activities with a 17 year old in all Australian jurisdictions.9

Proposed new subsection 474.40(1) - intention to encourage a physical meeting

2.14 Submitters also raised concerns in relation to a particular aspect of the proposed offence in new subsection 474.40(1): the intention to encourage the recipient to physically meet with the sender or any other person. In essence, these concerns were: the offence is not consistent with current Commonwealth criminal law policy; and there is no clear nexus between the non-criminal conduct captured by the proposed offence and the criminal conduct which is the subject of the offence.

Inconsistency with current Commonwealth criminal law policy

2.15 The Department advised:

Under Commonwealth law, it is highly unusual for lying to be made a criminal offence without an additional element that results in the behaviour being considered sufficiently abhorrent to justify criminal sanctions.10

2.16 The Department explained that lying for the sole purpose of encouraging a physical meeting with a child does not attract such an additional element and, if criminalised, would represent a departure from Commonwealth criminal law policy.11

No clear nexus between non-criminal and criminal conduct

2.17 The ACT Government and the Law Society of South Australia commented on the lack of nexus between the non-criminal conduct captured by the proposed offence (encouraging a physical meeting with a child) and the criminal conduct which might result from that meeting. The Law Society of South Australia submitted that its principal difficulty with proposed new subsection 474.40(1) is that it criminalises conduct of a non-criminal nature:

Part of the problem with the offence provision is that it seeks to criminalise behaviour which is not inherently criminal. The intent is to criminalise a

9 Submission 1, p. 4. Also see: ACT Government, Submission 6, p. 2; NSW Council for Civil Liberties, Submission 2, p. 2.

10 Submission 1, pp 4-5.

11 Submission 1, p. 5.

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preparatory step in the process of committing a crime. However, in attempting to do so, it will capture many situations it does not intend to.12

2.18 The Department's submission likewise explained that the broad application of proposed new subsection 474.40(1) 'would capture conduct that is innocent and not warranting of criminal sanctions'.13

2.19 The ACT Government expressed similar concerns:

While it is appropriate in some circumstances to criminalise activity which is not illegal but is a step toward the commission of a particular offence, there must be a sufficient connection between the legal and illegal activity to warrant a legislative response.14

2.20 In its submission, the ACT Government noted specific examples of legislative provisions which criminalise lawful conduct, subject to an intention to carry out, or for the purpose of carrying out, unlawful conduct (for example, section 272.20 of the Criminal Code). It was noted however that 'the non-illegal activity in the proposed new offence at section 474.40(1) is not connected in any way to any illegal activity'.15

Support for proposed new subsection 474.40(1)

2.21 On the other hand, two submitters - the Carly Ryan Foundation and Ms Susan McLean, a cyber-safety expert - argued that it is important to provide law enforcement agencies with the ability to investigate and prosecute alleged offenders prior to the commission of any procurement or grooming offence (that is, in the preparatory stages of the offence). The Carly Ryan Foundation submitted:

[N]o adult could have a legitimate reason for establishing false profiles with fake names, age and photos to contact and meet a child that is not known to them for legitimate purposes.

This online behaviour is a specific method used by those individuals with criminal intent. We wish to empower our law enforcement officers to act in order to prevent children suffering. Currently, the police have no ability to intervene before a crime is committed...This proposed law is the gap between our law enforcement agencies and the ability to make a difference before it's too late.16

12 Submission 5, p. 3.

13 Submission 1, p. 4. Also see: Law Society of Western Australia, Submission 9, p. 1.

14 Submission 6, p. 1.

15 Submission 6, p. 2. Section 272.20 of the Criminal Code criminalises acts committed with the intention of preparing for, or planning of, certain offences within Division 272—Child sex offences outside Australia.

16 Submission 7, p. 4. Also see: Ms Susan McLean, Submission 3, p. 9.

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2.22 The Department acknowledged that the offence proposed in new subsection 474.40(1) might allow law enforcement agencies to intervene during the preparatory stages of an offence; however, the scope of the proposed offence may prevent the capture of actual criminal activity.17

Proposed new subsection 474.40(2) - intention of committing an offence

2.23 In relation to the new offence proposed in subsection 474.40(2), the Law Society of South Australia,18 the ACT Government19 and the Department expressed concerns regarding the construction of the provision. The Department particularly questioned the meaning of the term 'offence' in paragraph 474.40(2)(c) and the fact that it is not clear whether the term 'offence' means a Commonwealth, state or territory offence or a serious or other offence. Without clarification, it is possible that this provision could apply to an intention to commit any offence, with the result that a person charged with an offence under new subsection 474.40(2) could face a greater penalty than the offence he or she had intended to commit. Further, it is not clear what fault element would apply to this element of the proposed offence.20

Committee view

2.24 The committee endorses the Bill's broad objective of enhancing the safety of children online; however, it is clear that existing offences in the Criminal Code already criminalise online communications with children where there is evidence of intention to cause harm to children. Accordingly, the committee considers that the new offences proposed in the Bill are not necessary.

2.25 Further, the committee notes that the majority of submitters highlighted issues in relation to the formulation of the new offences in proposed new section 474.40. The committee agrees that, as a general principle, criminal offences must be precisely defined, and should avoid capturing non-criminal conduct unless there is a clear nexus between that conduct and the criminal conduct which is the subject of the offence. The committee agrees that the proposed offences, while potentially criminalising a broader range of conduct than that already covered in the Criminal Code, capture conduct that goes beyond reasonable and accepted limits of criminal responsibility.

2.26 The committee notes the proposed amendments to the Bill (9185), which have been circulated by Senator Xenophon. One effect of these amendments is to reduce the age stipulated in the Bill from 18 years of age to 16 years of age, consistent with Commonwealth criminal law policy. While the committee considers that this may address one of the concerns identified in submissions, it does not resolve the

17 Submission 1, p. 4.

18 Submission 5, p. 4.

19 Submission 6, p. 2.

20 Submission 1, p. 5.

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committee's primary concerns that the Bill is not necessary and is too broad in its capture.

2.27 Therefore, the committee concludes that the Senate should not pass the Bill.

Recommendation 1

2.28 The committee recommends that the Senate not pass the Bill.

Senator Trish Crossin

Chair

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DISSENTING REPORT BY SENATOR XENOPHON 1.1 Carly Ryan was only 15 when she was brutally murdered by Gary Francis Newman, an online predator. This is her story, in the words of her mother, Sonya Ryan:

In 2006 Carly Ryan thought she had met her dream boyfriend online. His name was Brandon Kane, a 20 year old musician from Melbourne. Brandon was in fact fictitious. An internet construct, the cyberspace alter ego of Gary Francis Newman, a 50 year old predator and paedophile. Carly fell in love with the Brandon construct during months of online contact and phone calls.

Gary Newman took on another identity when he attended Carly's 15th birthday: that of Brandon's adopted father "Shane". In that guise, he attempted to gain the trust of Carly's mum, Sonya, and continued to deceive Carly, buying her gifts and promising to bring Brandon to Adelaide to meet her.

Gary Newman spent months masquerading as Brandon Kane to win Carly's love. When he tried to seduce her in person, while pretending to be Brandon's father Shane, saying that Brandon wouldn't mind if his dad had sex with her, she rejected him. Angry, Gary Newman returned to Melbourne vowing to "fix Carly up". He used his alter ego to lure Carly to a final, fatal meeting.

In February 2007, Gary Newman convinced Carly to meet him. He took Carly to a secluded beach at Port Elliott, South Australia. There, he bashed her, pushed her face into the sand, suffocating her. He then threw her into the water to drown. She was only 15 years old.

A local lady found Carly's body the next morning, covered in sand, her clothing in disarray.

Within 11 days detectives located Gary Newman in Victoria. They found him at his computer, logged in as Brandon Kane, talking with a 14 year old girl in Western Australia. They arrested him, charging him with Carly's murder.

In a Supreme Court trial which continued for over three months, a jury found Gary Francis Newman guilty of murder. He was sentenced on 31 March 2010. South Australian Justice Trish Kelly ordered him to serve a life behind bars with a 29 year non-parole period.1

1 The Carly Ryan Foundation, Carly's Story, available at: http://www.carlyryanfoundation.com/carlys_story (accessed 25 June 2013).

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History of the Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2013

1.2 In 2010 I introduced the Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2010, the purpose of which was to make it illegal for an adult to lie about their age when communicating with a child online. This bill failed to pass, however Sonya and I were not going to give up on the challenge of protecting children from online predators.

1.3 The Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2013 ('the bill') amends the Criminal Code Act 1995 to make it an offence for a person over 18 to intentionally misrepresent their age in online communications to a person they reasonably believe to be under 16 years of age for the purposes of encouraging a physical meeting, or with the intention of committing an offence.

1.4 I am dismayed that the committee recommended this bill not be passed. I understand the committee shares the view of the Attorney-General's Department and the South Australian Law Society that the Criminal Code already captures the behaviour this bill seeks to criminalise. However, I strongly disagree with this position for the reasons below.

The need for preventative measures

1.5 Internet use among persons under 16 years of age has reached unprecedented levels. In her submission, Ms Susan McLean, a cyber-safety expert and educator, summarised some research which reveals disturbing trends:

A 2005 survey of 742 teens (aged 13-18) and 726 tweens (aged 8-12) conducted by the Polly Klass Foundation (USA) reported…54 per cent of teens admitted communicating with someone they've never met using an Instant Messaging program, 50 per cent via email and 45 per cent in a chat room. Sixteen per cent of all respondents…discovered that someone that they were communicating with online was an adult pretending to be much younger.2

1.6 Ms Sonya Ryan explained in her submission why children are particularly vulnerable in an online environment:

Young teens often have a desire to be free of their parents' authority to gain acceptance as grown-ups. Teens are naïve and inexperienced, especially in dealing with adults who have ulterior motive. Sexual predators take advantage of this naivety. They manipulate kids in an effort to gain trust, which they use and gradually turn seemingly innocent online relationships into real-life sexual interactions. A predator usually approaches a child initially through harmless chat room or instant message dialogue. Over time - perhaps weeks or even months - the stranger, having obtained as much personal information as possible, grooms the child, gaining his or her trust

2 Submission 3, p. 2.

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through compliments, positive statements and other forms of flattery to build an emotional bond.3

1.7 As Sonya knows all too well, the consequences of an adult misrepresenting their age to a child through online communication can be fatal. In her submission, she explains why our current legislation does not go far enough:

We are seeking to add this vital law to address the common denominator in the way online predators behave, they all set up false online profiles, most reduce their online age to present as a peer to the child with the intention to meet that child. I put it to you that no adult could have a legitimate reason for establishing false profiles with fake names, age and photos to contact and meet a child that is not known to them for legitimate purposes. The proposed law is specifically tailored to that fact.4

1.8 The bill aims to provide law enforcement agencies with the ability to investigate and prosecute alleged offenders in the preparatory stages of their grooming activities, and to prevent children being placed in a position of danger:

As a nation we need to support our law enforcement units that are dealing with this new form of stranger danger, to ensure that once they have identified a predator, they have the support of Parliament to apprehend these criminals…This proposed law is the gap between our law enforcement agencies and the ability to make a difference before it's too late. We have comprehensive laws that protect us from those who seek to commit an act of terror, apprehending the persons (involved) prior to the event. I believe we also need to have laws that protect our children on the same basis, to prevent an act of terror, terror that may or may not end in death, but may cause a lifetime of trauma.5

Amendments to the bill

1.9 The amendments circulated for this bill address the concerns which have been raised through the committee process by reducing the age of the victim from 18 to 16 (in line with Commonwealth criminal laws) and by removing the reference to provisions which would have made offences committed under this bill absolute liability offences.

1.10 I find it extraordinary that while the committee has considered these amendments, it still maintains this bill to protect children is unnecessary. The committee is in effect saying an adult can lie about their age online to a child and attempt to meet that child without any legal consequences. As Sonya Ryan knows too well, this deception can have devastating consequences.

3 Submission 7, p. 3.

4 Submission 7, p. 4.

5 Submission 7, p. 4.

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Recommendation 1

1.11 That the bill (as amended) be passed.

Senator Nick Xenophon

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APPENDIX 1

SUBMISSIONS RECEIVED

Submission Number Submitter

1 Attorney-General's Department

2 New South Wales Council for Civil Liberties

3 Ms Susan McLean

4 National Children's and Youth Law Centre

5 The Law Society of South Australia

6 ACT Government

7 The Carly Ryan Foundation

8 Law Council of Australia

9 The Law Society of Western Australia

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The Senate

Legal and Constitutional Affairs

Legislation Committee

Customs Amendment (Miscellaneous Measures) Bill 2012 [Provisions]

March 2013

187

© Commonwealth of Australia

ISBN: 978-1-74229-783-5

This document was produced by the Senate Legal and Constitutional Affairs Committee secretariat and printed by the Senate Printing Unit, Department of the Senate, Parliament House, Canberra.

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MEMBERS OF THE COMMITTEE

Members

Senator Patricia Crossin, Chair, ALP, NT

Senator Gary Humphries, Deputy Chair, LP, ACT

Senator Sue Boyce, LP, QLD

Senator Mark Furner, ALP, QLD

Senator Louise Pratt, ALP, WA

Senator Penny Wright, AG, SA

Secretariat

Ms Julie Dennett Committee Secretary

Ms Sandra Kennedy Principal Research Officer

Ms Elise Williamson Administrative Officer

Suite S1.61 Telephone: (02) 6277 3560

Parliament House Fax: (02) 6277 5794

CANBERRA ACT 2600 Email: legcon.sen@aph.gov.au

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TABLE OF CONTENTS

MEMBERS OF THE COMMITTEE ............................................................. iii

RECOMMENDATION ................................................................................... vii

CHAPTER 1 ........................................................................................................ 1

PURPOSE OF THE BILL AND KEY ISSUES ..................................................... 1

Purpose of the Bill .................................................................................................. 1

Conduct of the inquiry ............................................................................................ 1

Key provisions of the Bill ....................................................................................... 2

Issues raised during the inquiry .............................................................................. 4

Committee view ...................................................................................................... 5

APPENDIX 1 ....................................................................................................... 7

SUBMISSIONS RECEIVED ................................................................................... 7

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RECOMMENDATION

Recommendation 1

1.22 The committee recommends that the Senate pass the Bill.

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CHAPTER 1

PURPOSE OF THE BILL AND KEY ISSUES

1.1 On 28 November 2012, the Minister for Justice, the Hon Jason Clare MP (Minister), introduced the Customs Amendment (Miscellaneous Measures) Bill 2012 (Bill) into the House of Representatives.1 On 29 November 2012, the Senate referred the provisions of the Bill to the Legal and Constitutional Affairs Legislation Committee (committee) for inquiry and report by 13 March 2013.2

Purpose of the Bill

1.2 The main purpose of the Bill is to introduce a new offence into the

Customs Act 1901 (Cth) (Customs Act) for bringing 'restricted goods' into Australia.3 The Bill will also make a number of technical amendments to the Customs Act, the A New Tax System (Wine Equalisation Tax) Act 1999 (Cth) and the Import Processing Charges Act 2001 (Cth), which are intended to improve regulation in areas such as entry of ships and aircraft for home consumption, warehouse licencing arrangements and timeliness of cargo reporting.4

1.3 The Australian Customs and Border Protection Service (Customs) consulted industry through the release of an exposure draft of the Bill in September 2012.5 Customs has advised the committee that key stakeholders responded positively to the proposed changes contained in the exposure draft.6

Conduct of the inquiry

1.4 The committee advertised the inquiry in The Australian on 5 December 2012, and wrote to 65 stakeholders inviting submissions by 31 January 2013. Details of the inquiry, including the Bill and associated documents, were made available on the committee's website at www.aph.gov.au/senate_legalcon.

1.5 The committee received two submissions - from the Australian Shipowners Association (ASA) and Customs - and no public hearings were held for the inquiry.

1 House of Representatives, Votes and Proceedings, No. 145-28 November 2012, pp 2002-2003.

2 Senate, Journals of the Senate, No. 129-29 November 2012, pp 3480-3481.

3 Explanatory Memorandum (EM), p. 2.

4 EM, p. 2.

5 Australian Customs and Border Protection Notice No. 2012/53, Customs Amendment (Miscellaneous Measures) Bill 2012 Exposure Draft, available at: http://www.customs.gov.au/notices/acn/default.asp (accessed 25 February 2013).

6 Submission 2, p. 6.

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Key provisions of the Bill

1.6 Schedule 1 of the Bill is comprised of nine Parts.

Part 1 of Schedule 1 - new offence for bringing 'restricted goods' into Australia

1.7 Part 1 of Schedule 1 of the Bill proposes amendments to the Customs Act to introduce an offence for bringing into Australia a new category of goods, known as 'restricted goods'. Proposed new section 233BABAE (item 6 of Schedule 1), which will create the offence, contains the definition of 'restricted goods':

restricted goods are goods:

a. that, if imported, would be prohibited imports; and

b. that are prescribed by the regulations for the purposes of this definition.7

1.8 In his second reading speech, the Minister explained that '[i]nitially, the new category of restricted goods will be limited to child pornography and child abuse material' but that, in future, it 'could be extended to give effect to international agreements or to address matters of international concern'.8 Proposed new subsection 233BABAE(4) provides that the proposed provision only has effect for 'purposes related to external affairs, including: for purposes giving effect to an international agreement to which Australia is a party; and for purposes related to addressing matters of international concern'.9

1.9 In its submission to the inquiry, Customs explained the basis for the proposed changes:

On occasion, Customs and Border Protection identifies the presence of child pornography in the personal effects of commercial ship's crew. As there is no intention to import these goods [however], the owner has not breached Customs law.10

1.10 Under the existing law, when such items are identified, Customs may either: refer the matter to state or territory police for consideration of offence charges; or Customs may secure the goods on board or withhold the goods.11 Where Customs

7 Proposed new subsection 233BABAE(3) of the Customs Act 1901 (Cth) (Customs Act).

8 House of Representatives Hansard, 28 November 2012, p. 13667.

9 As the 'restricted goods' being brought into Australia are not being imported, the Commonwealth cannot rely on the Trade and Commerce provision in subsection 51(i) of the Constitution. The Commonwealth is relying on the external affairs power in subsection 51(xxix) of the Constitution on the grounds of domestic implementation of international treaty obligations, and matters of international concern: EM, p. 7.

10 Submission 2, p. 2. The EM explains that, although child pornography and child abuse material is a prohibited import, when detected in the personal effects of ship crew, as the material is not intended to be imported it is not considered to have 'landed, or intended to be landed, in Australia' so cannot be seized as a prohibited import: EM, p. 6.

11 Australian Customs and Border Protection Service, Submission 2, p. 2.

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secures or withholds the goods, the goods are returned to the owner on departure from Australia.12

1.11 The amendments proposed in Part 1 of Schedule 1 will enable Customs to seize 'restricted goods' without warrant, when they are detected, by amending the definition of 'special forfeited goods'13 to include 'restricted goods'14 (item 4 of Schedule 1). Where 'restricted goods' are seized, the person will be liable for an offence.15

1.12 The proposed new offence will carry a penalty of 1,000 penalty units.16 As the EM explains:

Given the nature of the material to be included as restricted goods, 1000 penalty units is appropriately high so as to deter people from bringing into Australia the kind of goods which will be restricted goods.17

Parts 2-9 of Schedule 1 - other amendments

1.13 The remaining eight Parts of Schedule 1 make a number of technical amendments, including:

• clarifying that self-powered ships and aircraft that are imported or intended to be imported are subject to the control of Customs and should be entered for home consumption (Part 2 of Schedule 1);

• amending a number of valuation definitions to ensure consistency with the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 (World Trade Organisation Customs Valuation Agreement) (to give effect to Australia's obligations under the World Trade Organisation Customs Valuation Agreement) (Part 3 of Schedule 1);

• enabling officers of Customs to designate a customs-controlled area for both passengers and crew, and the Chief Executive Officer (CEO) of Customs to designate a seaport as a customs-controlled area (Part 4 of Schedule 1);

• allowing the CEO of Customs to request further information from an applicant, to address any concerns prior to the grant of a warehouse licence and without the need for the applicant to submit a new application (Part 5 of Schedule 1);

12 Australian Customs and Border Protection Service, Submission 2, p. 2.

13 'Special forfeited goods' can be seized by Customs without the need for a warrant at a Customs place: EM, p. 6.

14 EM, p. 7; Australian Customs and Border Protection Service, Submission 2, p. 2.

15 EM, p. 6. Proposed new subsection 233BABAE(3) of the Customs Act provides that the person will not be subject to an offence if they have brought the goods into Australia 'in accordance with a written permission given by the Minister'.

16 Proposed new subsection 233BABAE(1) of the Customs Act.

17 EM, p. 6.

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• aligning the treatment of the timeliness of reports of relevant cargo reporters to ensure that, in the cases of unexpected changes to the time of arrival of voyages or flights to Australia, certain cargo reporters are not liable for an offence for not making their reports within the original prescribed timeframe (Part 6 of Schedule 1);

• repealing the legislation which introduced the accredited client program, since that program has never been implemented operationally (Part 7 of Schedule 1);

• repealing expired transitional moratorium periods for electronic cargo reporting (Part 8 of Schedule 1); and

• making other minor technical amendments (Part 9 of Schedule 1). 18

Issues raised during the inquiry

1.14 The ASA's submission expressed support for 'most of the content of the [Bill], and the relevant clarifications that [it] provides';19 however, the ASA considered that 'there are additional urgent matters for consideration in relation to the way the

[Customs Act] is being implemented in very recent times' in the context of ship importation and home consumption requirements.20

1.15 The ASA was concerned in relation to the 'consequences of the proposed amendments to subsections 71A(7) and (8) and subsections 68(2) and (3) set out in the Bill [items 13 and 12 of Schedule 1, respectively], and the new policy approach of Customs…in relation to ship importation'.21 In particular:

The circumstances under which ships are deemed by Customs to be imported and required to be entered for home consumption has changed. Customs decisions to import seem now to be based on a very strict interpretation of whether the vessel has entered the commerce of Australia and no longer consider the actual intentions of the operator. This is an issue which is currently of great concern to ship owners and operators and which is not addressed and is potentially exacerbated as a result of the proposed amendments.22

1.16 The ASA also pointed to the 'significant uncertainty within industry' regarding the policy connection between recent changes effected by the Coastal Trading (Revitalising Australian Shipping) Act 2012 in relation to voyage permits and importation decisions by Customs about when a vessel has entered into the commerce of Australia.23 Specifically, '(v)essels are now being required to be imported that

18 EM, p. 2 and pp 6-18.

19 Submission 1, p. 2.

20 Submission 1, pp 2 and 3.

21 Submission 1, p. 3.

22 Submission 1, pp 3-4.

23 Submission 1, pp 4-6.

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would not have been previously',24 which has 'significant negative flow on effects to Australian businesses and the Australian economy'.25

1.17 Customs responded to the matters raised by the ASA as follows:

[T]he matters raised [by the ASA] are not relevant to the amendments proposed to be made in this Bill. Customs and Border Protection can also confirm that it does not have a new policy position in relation to importation of ships.26

1.18 Further:

The proposed amendments are not about determining whether or not a ship is imported. The Bill is making clear that if self-powered ships or aircraft are imported or intended to be imported, they must (like all other goods) be entered for home consumption or warehousing in accordance with subsections 68(2) and 68(3) [of the Customs Act]. The Bill is clarifying existing policy.27

1.19 The committee notes the concerns raised by the ASA, but is satisfied by the advice provided by Customs that these matters are not relevant to consideration of the Bill. The committee also notes that no other concerns have been raised in respect of the Bill.

Committee view

1.20 The main purpose of the Bill is to enable certain items, in the first instance child pornography and child abuse material, to be classified as 'restricted items' and therefore capable of being seized without warrant where found in the personal effects of a ship or aircraft's crew. The committee supports these proposed amendments.

1.21 The committee is of the view that the remaining amendments set out in the Bill are minor technical amendments that will assist in clarifying the law or removing now redundant provisions.

Recommendation 1

1.22 The committee recommends that the Senate pass the Bill.

Senator Trish Crossin Chair

24 Submission 1, p. 6.

25 Submission 1, p. 8.

26 Australian Customs and Border Protection Service, answer to written question on notice, received 28 February 2013, p. 1.

27 Australian Customs and Border Protection Service, answer to written question on notice, received 28 February 2013, p. 1.

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APPENDIX 1

SUBMISSIONS RECEIVED

Submission Number Submitter

1 Australian Shipowners Association

2 Australian Customs and Border Protection Service

ADDITIONAL INFORMATION RECEIVED

1 Response to a written question on notice provided by Australian Customs and Border Protection Service on 28 February 2013

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The Senate

Legal and Constitutional Affairs

Legislation Committee

Marriage Amendment (Celebrant Administration and Fees) Bill 2013 [Provisions]

Marriage (Celebrant Registration Charge) Bill 2013 [Provisions]

June 2013

203

© Commonwealth of Australia

ISBN: 978-1-74229-869-6

This document was produced by the Senate Legal and Constitutional Affairs Committee secretariat and printed by the Senate Printing Unit, Department of the Senate, Parliament House, Canberra.

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MEMBERS OF THE COMMITTEE

Members

Senator Patricia Crossin, Chair, ALP, NT

Senator Gary Humphries, Deputy Chair, LP, ACT

Senator Sue Boyce, LP, QLD

Senator Mark Furner, ALP, QLD

Senator Louise Pratt, ALP, WA

Senator Penny Wright, AG, SA

Secretariat

Ms Julie Dennett Committee Secretary

Ms Monika Sheppard Senior Research Officer

Ms Elise Williamson Administrative Officer

Suite S1.61 Telephone: (02) 6277 3560

Parliament House Fax: (02) 6277 5794

CANBERRA ACT 2600 Email: legcon.sen@aph.gov.au

205

206

TABLE OF CONTENTS

MEMBERS OF THE COMMITTEE ............................................................. iii

RECOMMENDATION ................................................................................... vii

CHAPTER 1 ........................................................................................................ 1

INTRODUCTION .................................................................................................... 1

Purpose of the bills ................................................................................................. 1

Previous consultations on measures contained in the bills..................................... 1

Key provisions of the bills ...................................................................................... 4

Conduct of the inquiry ............................................................................................ 5

Acknowledgement .................................................................................................. 5

Note on references .................................................................................................. 5

CHAPTER 2 ........................................................................................................ 7

KEY ISSUES ............................................................................................................. 7

Imposition of charge on Commonwealth-registered marriage celebrants only ..... 7

Amount of the registration charge .......................................................................... 9

De-registration as a consequence of not paying the registration charge .............. 11

Committee view .................................................................................................... 12

APPENDIX 1 ..................................................................................................... 15

SUBMISSIONS RECEIVED ................................................................................. 15

APPENDIX 2 ..................................................................................................... 21

WITNESSES WHO APPEARED BEFORE THE COMMITTEE ................... 21

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RECOMMENDATION

Recommendation 1

2.30 The committee recommends that the Marriage Amendment (Celebrant Administration and Fees) Bill 2013 and the Marriage (Celebrant Registration Charge) Bill 2013 be passed.

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CHAPTER 1 INTRODUCTION

1.1 On 20 March 2013, the Marriage Amendment (Celebrant Administration and Fees) Bill 2013 (Administration and Fees Bill) and the Marriage (Celebrant Registration Charge) Bill 2013 (Charge Bill) were introduced into the House of Representatives by the Attorney-General, the Hon Mark Dreyfus QC MP.1 On 21 March 2013, the Senate referred the provisions of both bills to the Senate Legal and Constitutional Affairs Legislation Committee (committee) for inquiry and report by 18 June 2013.2

Purpose of the bills

1.2 All persons who solemnise marriages in Australia must be authorised under Division 1 of Part IV of the Marriage Act 1961 (Cth) (Marriage Act). That Division establishes three categories of authorised celebrants:

• ministers of religion of a recognised denomination, proclaimed under section 26 of the Marriage Act, who are nominated by their denomination and who are registered and regulated by state and territory Registries of Births, Deaths and Marriages (Subdivision A);

• state and territory officers who are authorised to perform marriages as part of their duties, and who are registered and regulated by state and territory Registries of Births, Deaths and Marriages (Subdivision B); and

• Commonwealth-registered marriage celebrants (celebrants) who are regulated under the Marriage Celebrants Program administered by the

Attorney-General's Department (Department) (Subdivision C). This group includes civil celebrants, and celebrants who are ministers of religion whose denomination is not proclaimed under section 26 of the Marriage Act.

1.3 The bills seek to implement a 2011-12 Budget measure, to introduce cost recovery for the third category only from 1 July 2013.3

Previous consultations on measures contained in the bills

1.4 In 2011 and 2012, the Department conducted two public consultations on the cost recovery measure announced in the 2011-12 Budget. The peak representative body for celebrants, the Coalition of Celebrant Associations (CoCA), was involved in

both the 2011 consultation and the 2012 consultation.

1 House of Representatives, Votes and Proceedings, No. 159-20 March 2013, p. 2186.

2 Senate, Journals of the Senate, No. 143-21 March 2013, pp 3865 and 3867.

3 Marriage Amendment (Celebrant Administration and Fees) Bill 2013 (Administration and Fees Bill), Explanatory Memorandum (EM), p. 2; Marriage (Celebrant Registration Charge) Bill 2013 (Charge Bill), EM, p. 2.

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2011 consultation

1.5 In late 2011, the Department consulted publicly on the introduction of an annual registration fee (2011 consultation). Seventeen face-to-face meetings were held nationally throughout October and November 2011, and over 280 written submissions were received by December 2011 in response to a call for submissions.4

1.6 The Department reported the key issues arising from the 2011 consultation, and advised that these matters would be considered by the Department as it developed the reform.5 As part of its report, the Department also outlined the key stages of the reform, which included the release of a consultation paper in mid-late 2012 to allow interested stakeholders a further opportunity to comment on the proposals.6

2012 consultation

1.7 In August 2012, the Marriage Celebrants Program, Program Improvements through Cost Recovery consultation paper was released (consultation paper), with the Department calling for submissions by 24 September 2012 (2012 consultation). The paper detailed the proposed cost recovery arrangements, as well as proposed key changes to the Marriage Celebrants Program. The Department explained the dual purpose of the reform:

While cost recovery will form an integral part of the Program once implemented, the Department is also determined to provide improved services and value for money to Commonwealth-registered marriage celebrants. The benefits of proper regulation of the Program will also flow on to marrying couples as the end users of an improved Program.7

1.8 The consultation paper acknowledged the significant feedback received from stakeholders during the 2011 consultation, particularly in relation to the charging structure and proposed improvement to services:

[T]he Department has considered ways to improve its service delivery to, and regulation of, marriage celebrants. It engaged an external consultant to cost this service delivery and regulation and formulate a charging structure that would prove reasonable, as well as reflect value for money for celebrants. A 'bottom up' methodology was used to cost the charging

4 Attorney-General's Department (AGD), Summary of Consultations on Marriage Celebrants Program Reforms (Summary of Consultations), p. 1, available at: http://www.ag.gov.au/FamiliesAndMarriage/Marriage/Pages/ChangestotheMarriageCelebrants Program.aspx (accessed 26 March 2013).

5 AGD, Summary of Consultations, p. 2.

6 AGD, Summary of Consultations, pp 2-3.

7 AGD, Marriage Celebrants Program, Program Improvements through Cost Recovery, Consultation Paper (2012 Consultation Paper), August 2012, p. 1, available at: http://www.ag.gov.au/FamiliesAndMarriage/Marriage/Pages/ChangestotheMarriageCelebrants Program.aspx (accessed 26 March 2013).

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structure, involving a detailed analysis of the celebrant population and the relevant steps in each proposed [process] with improved efficiencies.8

1.9 The Department advised in August 2012 that the following charges would apply to the Marriage Celebrants Program from 1 July 2013:

• a $600 fee for persons applying for registration as a celebrant (application fee);

• an annual charge of $240 for registered celebrants (registration charge); and

• a $30 processing fee for applications for exemption from either the

application fee or the registration charge (processing fee).9

1.10 The consultation paper noted the proposition that the registration charge could be based on a sliding scale. However, 'the Department considered the principles of fairness and equity in how it delivers services to celebrants' and concluded that a flat fee ought to be charged:

[T]he Department carefully considered the argument that many celebrants perform few weddings and should therefore be subject to a lower charge. To do so under a cost recovery arrangement, the Department would be required to demonstrate that it more actively regulates those celebrants that perform more marriages. Given that it can also be argued that those celebrants who perform more weddings may require less regulatory effort from the Department, a sliding charge is unsuitable.10

1.11 The consultation paper indicated also that exemptions from payment would be available to celebrants operating in remote, very remote or migratory areas (as defined by the Australian Bureau of Statistics' Remoteness Structure classifications), and those celebrants affected by 'special circumstances'.11 A brief description of what might constitute 'special circumstances' was provided in the consultation paper:

'Special circumstances' are beyond the celebrant's control in situations which a reasonable person would consider is not due to the celebrant's action or inaction, either direct or indirect, and for which the celebrant is not responsible. The situation must be unusual, uncommon or abnormal to celebrants and the profession generally. It might include serious ill health at a level that renders the marriage celebrant unable to perform their duties as a marriage celebrant, family issues or extended periods of leave.12

8 AGD, 2012 Consultation Paper, August 2012, p. 2.

9 AGD, 2012 Consultation Paper, August 2012, p. 2.

10 AGD, 2012 Consultation Paper, August 2012, p. 3. Also see: AGD, Submission 108, pp 5-6.

11 AGD, 2012 Consultation Paper, August 2012, pp 3-4. An indicative guide to residential postcodes fulfilling the Australian Bureau of Statistics' criteria was provided at p. 8.

12 AGD, 2012 Consultation Paper, August 2012, p. 4.

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1.12 As in the 2011 consultation, the Department outlined the next stages of the reform, including the development of a Cost Recovery Impact Statement (CRIS). The CRIS is intended to reflect the outcomes of the two consultations and will be made available on the Department's website by 30 June 2013.13

1.13 The Department advised that 72 submissions were received in relation to the 2012 consultation, leading to two meetings with CoCA to discuss the proposed changes.14

Key provisions of the bills

1.14 The key provisions of the two bills are described below.

Administration and Fees Bill

1.15 The Administration and Fees Bill seeks to amend the Marriage Act to:

• create the registration charge (proposed new subsection 39FA(1), item 3 of Schedule 1), and provide for the deregistration of celebrants who do not pay the charge, or who are not exempted from paying the charge, by the charge payment day (proposed new section 39FB, item 3 of Schedule 1);

• allow for the imposition, by way of regulations, of the application fee (proposed new subsection 39D(1B), item 6 of Schedule 1);

• provide for exemptions from payment, by way of regulations (proposed new paragraphs 39FA(3)(a) and 39D(1C)(a), items 3 and 6 of Schedule 1), and allow for the imposition of the processing fee (proposed new paragraphs 39FA(3)(b) and 39D(1C)(b), items 3 and 6 of Schedule 1);

• change the requirements relating to performance reviews of celebrants (proposed new subsection 39H(1), item 2 of Schedule 2), to repeal the requirement for five-yearly reviews and instead institute discretionary and targeted reviews by the Registrar of Marriage Celebrants; and

• increase the efficiency and operation of the Marriage Celebrants Program (Part 1 of Schedule 2).15

13 AGD, 2012 Consultation Paper, August 2012, p. 7. Note: the Cost Recovery Impact Statement was provided in evidence to the inquiry: see AGD, Submission 108, Attachment 1.

14 See:

http://www.ag.gov.au/FamiliesAndMarriage/Marriage/Pages/ChangestotheMarriageCelebrants Program.aspx (accessed 26 March 2013).

15 Administration and Fees Bill, EM, p. 2. The last two purposes are not related to cost recovery, which is the main purpose of the Administration and Fees Bill. Instead, these two purposes are described as being minor administrative improvements to the Marriage Celebrants Program: see p. 2.

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Charge Bill

1.16 The Charge Bill seeks to provide legislative authority for the Commonwealth to charge celebrants an annual cost recovery levy.16 The key provisions of this bill:

• impose the registration charge each financial year in accordance with proposed new section 39FA of the Marriage Act (clause 6);

• provide that the amount of the registration charge is to be determined by the Attorney-General, by legislative instrument, and is not to exceed the statutory limit (subclause 7(1)); and

• sets a statutory limit of $600 on the registration charge for the financial year commencing 1 July 2013, to be indexed annually in accordance with the Consumer Price Index (subclause 8(1)).17

Conduct of the inquiry

1.17 The committee advertised the inquiry in The Australian on 27 March 2013. Details of the inquiry, including links to the bills and associated documents, were placed on the committee's website at www.aph.gov.au/senate_legalcon.

The committee also wrote to 26 organisations and individuals, inviting submissions by 26 April 2013. Submissions continued to be accepted after that date.

1.18 The committee received 113 submissions and a number of form letters for this inquiry, which are listed at Appendix 1. All submissions and some examples of the form letters were published on the committee’s website.

1.19 The committee held a public hearing on 24 May 2013 at Parliament House in Canberra. A list of witnesses who appeared at the hearing is at Appendix 2, and the Hansard transcript is available through the committee's website.

Acknowledgement

1.20 The committee thanks those organisations and individuals who made submissions and who gave evidence at the public hearing.

Note on references

1.21 References to the committee Hansard are to the proof Hansard. Page numbers may vary between the proof and the official Hansard transcript.

16 Charge Bill, EM, p. 2.

17 Charge Bill, cls 6-8.

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CHAPTER 2

KEY ISSUES

2.1 Most submitters to the committee's inquiry expressed strong opposition to the bills and, in doing so, supported the views and recommendations made in the Coalition of Celebrant Associations' (CoCA) submission. CoCA is the peak representative body for marriage celebrant associations in Australia.

2.2 Some of the issues raised in submissions and evidence included:

• the perceived 'discriminatory' imposition of a registration charge on Commonwealth-registered marriage celebrants, and not on other categories of authorised marriage celebrants;

• objections to the amount of the registration charge; and

• opposition to deregistration as the sanction for non-payment of the registration charge.

Imposition of charge on Commonwealth-registered marriage celebrants only

2.3 Most submitters commented on the apparent differential treatment of Commonwealth-registered marriage celebrants, compared to other persons authorised to solemnise marriages in Australia, by the imposition of the registration charge on that category of authorised celebrants only. CoCA argued that, by not applying to all categories of authorised celebrants, the bills:

…impose unfair conditions upon which [Commonwealth-registered celebrants'] services can be terminated upon specific grounds not applicable to other categories of [authorised celebrants] even though all three categories provide the same government approved service of legal marriage to the Australian community[.]1

2.4 Both CoCA and the Civil Celebrants' Graduate Association (Monash) (CCGA) questioned the equity in requiring only Commonwealth-registered marriage celebrants to contribute to cost recovery. CoCA submitted that, since the Attorney-General's Department (Department) provides services to all authorised celebrants, as well as members of the public, Commonwealth-registered marriage celebrants alone should not be funding those government services.2 CCGA similarly considered it 'unfair' to target only one category of authorised celebrant.3

1 Submission 35, [p. 16]. Also see, for example: Civil Celebrants' Graduate Association (Monash) (CCGA), Submission 49, p. 5.

2 Submission 35, [p. 19].

3 Submission 49, p. 5.

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2.5 Several submitters argued that costs should be recovered directly from all marrying couples, rather than the person conducting the marriage ceremony.4 CoCA took the view that this would, among other things, be a fairer and more effective method of cost recovery, and would allow for the Marriage Law and Celebrants Section in the Department to be funded by all persons using its services, not just Commonwealth-registered marriage celebrants.5

2.6 This view was not, however, shared by all submitters and witnesses. For example, the North Queensland Celebrants Networking Group supported the creation and imposition of the registration charge on Commonwealth-registered marriage celebrants only.6

2.7 Similarly, the Australian Federation of Civil Celebrants (AFCC) submitted that the proposals in the bills:

• are a practical and equitable way to reduce the number of registered celebrants;

• are consistent with the principle of 'user pays'; and

• will fund improved services to celebrants by the Department. 7

2.8 At the public hearing, Mr Alan Milson from the AFCC elaborated on these arguments:

Celebrants do operate as a commercial venture and are paid for their services…[I]t should not be the general taxpayer that pays for the maintenance of a register and the other necessary management of the celebrant program but those that financially benefit from the existence of

the program…[T]he reality is that celebrants are the commercial beneficiary of the program and should be the point of payment.8

Departmental response

2.9 With respect to the proposal to recover costs directly from

Commonwealth-registered marriage celebrants, the Department advised that various options for cost recovery had been considered; however, the option of recovering costs from marrying couples is not consistent with the Australian Government's cost recovery principles.9 The Cost Recovery Guidelines provide that '(u)sers of the Australian Government's information products being cost recovered or

4 For example: Australian Marriage Celebrants (AMC), Submission 44, [p. 4]; Alliance of Celebrants Queensland, Submission 47, p. 2; CCGA, Submission 49, pp 5-6; Association of Civil Marriage Celebrants of Victoria, (ACMCV), Submission 50, [p. 4].

5 Submission 35, [pp 12, 17 and 19]. Also see: ACMCV, Submission 50, [p. 4].

6 Submission 1, p. 2.

7 Submission 2, p. 2.

8 Committee Hansard, 24 May 2013, p. 6.

9 Submission 108, p. 5.

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individuals/groups that have created the need for regulation should pay cost recovery charges'.10

2.10 The Department confirmed that the end-users of the Marriage Celebrants Program administered by the Department are the Commonwealth-registered marriage celebrants from whom costs will be recovered. Further, the other two categories of authorised celebrants are not part of the cost recovery model because they do not receive the same support and benefits from the Marriage Celebrants Program:

…significant legislative, policy and administrative amendments [would be required] to recover a fee from a new class of people that [is] currently not subject to significant interaction with the department.11

Amount of the registration charge

2.11 A number of submitters expressed concern with the proposed amount of the registration charge: $240, commencing 1 July 2013. Many submitters described how they expect the amount of the registration charge will affect their personal circumstances.

2.12 CoCA explained that those celebrants with 'other employment or private resources' will be able to afford the registration charge. However, those more likely not to be able to afford the charge would include:

• longer-term celebrants who mentor newer celebrants,

• more experienced celebrants who have caring responsibilities for partners, parents or grand-children,

• full-time civil celebrants who like religious celebrants provide a range of other ceremonies, particularly civil funeral ceremonies.12

2.13 CoCA argued that the impost of the charge will result in a diminution of the expertise and experience of large numbers of Commonwealth-registered marriage celebrants:

The standard of the profession overall will be diminished by the loss of this knowledge and expertise, simply on the basis of a crude cutting numbers measure by the government.13

10 Department of Finance and Administration, Australian Government Cost Recovery Guidelines, June 2005, p. 40, available at: http://www.finance.gov.au/publications/finance-circulars/2005/09.html#FMG_4 (accessed 28 May 2013).

11 Submission 108, p. 5.

12 Submission 35, [p. 25].

13 Submission 35, [p. 25]. Also see: Civil Celebrants' Graduate Association (Monash) (CCGA), Submission 49, p. 4; ACMCV, Submission 50, [p. 1].

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2.14 On the other hand, Mr Milson from the AFCC expressed the view that $240 is a small sum over a 12-month period:

[T]he fee will professionalise the conception of, 'I have got to put this amount of costs into this business, or into this profession, to be able to make a return'. That will adjust the hobbyist out of the profession and also possibly increase costs to an acceptable level.14

Departmental response

2.15 A departmental representative acknowledged the concern of stakeholders regarding the capacity of some celebrants to pay the $240 registration charge. The Department explained that there has been an attempt to address this concern, by costing the charge based on 'what celebrants really want from the [D]epartment' and by providing for exemptions from payment:

[T]he key thing from the [D]epartment's perspective is to demonstrate the value that [the Department] would provide in response to that fee paid by the celebrants. That is something that is coming up in the future, if the legislation is passed on 1 July.15

2.16 The submission from the Department noted that the costing arrangements will be reviewed at least every five years. In this regard, the Department has undertaken to review the costing model before 1 July 2016, in consultation with stakeholders.16

2.17 In response to the suggestion by some submitters and witnesses that the Marriage Act should provide for a cap on the number of registered celebrants, or some form of capping mechanism to reduce the number of marriage celebrants, the Department explained that such proposals would not be a viable or efficient way to manage celebrant numbers and ensure professionalism within the industry:

Experience with the 2003-08 'cap' on new registrations…indicates that the cap did not dissuade people from applying to become a celebrant, but rather led to extensive waiting lists for aspiring celebrants who ultimately became registered before the cap expired (due to the increase in the cap in 2006) or at its expiry in 2008. A regional appointment process is also incongruous with the ability of marriage celebrants to marry couples anywhere in Australia once registered.17

14 Committee Hansard, 24 May 2013, p. 7.

15 Mr Peter Arnaudo, AGD, Committee Hansard, 24 May 2013, p. 11.

16 Submission 108, p. 4.

17 Submission 108, p. 8.

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De-registration as a consequence of not paying the registration charge

2.18 A large number of submitters expressed concern with the proposed consequences of non-payment of the registration charge, with two arguments featuring prominently in submissions: first, registered celebrants are authorised for life;18 and, second, deregistration at short notice could adversely affect marrying couples.19

2.19 At the public hearing, Mr Milson from the AFCC informed the committee that he did not consider that registration as a celebrant is a 'life time appointment'; he also expressed the view that registered celebrants are 'authorised to perform marriages, not appointed to a position, and that authorisation is a privilege not a right'.20

2.20 Further:

[Any argument that deregistration will be detrimental to the marrying public] is unfounded as [the AFCC] cannot envisage any situation where a celebrant who has consciously agreed to book and prepare for a wedding with the intention of not paying the fee would be registered.21

2.21 Many submitters objected also to deregistration as a consequence of not having paid the registration charge, rather than deregistration being due to below-par professional performance.22

2.22 In CoCA's view:

[T]here is absolutely no justification for the government to remove the right to continue to practice as a [celebrant] if one continues to be a [f]it and [p]roper [p]erson simply on the basis of the non-payment of an annual fee.

Removing ongoing lifetime appointments (by removing 5 yearly reviews of performance) [and replacing that] with annual appointment based upon ability to pay a fee (rather than poor performance):

• has serious and unnecessary consequences for the marrying public,

• is a disproportionally harsh consequence for the non-payment of [a] fee,

• is discriminatory in its being only applicable to one [c]ategory of [authorised] [c]elebrant[.]23

18 For example: CoCA, Submission 35, [p. 5]; AMC, Submission 44, [p. 2]; CCGA, Submission 49, p. 3; ACMCV, Submission 50, [p. 2]; Civil Celebrations Network (CCN), Submission 46, p. 2.

19 For example: AMC, Submission 44, [p. 5]; CCN, Submission 46, p. 2; CCGA, Submission 49, pp 3-4; ACMCV, Submission 50, [p. 2].

20 Mr Alan Milson, AFCC, Committee Hansard, 24 May 2013, p. 6.

21 Committee Hansard, 24 May 2013, p. 6.

22 For example: AMC, Submission 44, [p. 5]; ACMCV, Submission 50, [p. 2].

23 Submission 35, [p. 32]. Also see: CCN, Submission 46, p. 2.

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2.23 Mr Milson from the AFCC, however, did not agree:

[D]eregistration as a result of non-payment is an uncomplicated, low-cost and less time-consuming procedure to remove non-practising or noncompliant entities and is…a method of retaining the

contemporaneousness of the register.24

Departmental response

2.24 The Department confirmed that registration as a marriage celebrant does not equate to a 'lifetime appointment', and emphasised that registration is subject to compliance with certain obligations:

[A] celebrant who does not meet these obligations can be

deregistered…The introduction of an annual cost recovery charge imposes a new obligation upon celebrants (similar to existing obligations to undertake annual ongoing professional development, acting in a fit and proper manner and updating the Registrar of Marriage Celebrants of any change in their circumstances).25

2.25 The Department explained that the concerns of marriage celebrants in relation to 'accidental deregistration' have been addressed:

• by allowing ample opportunity for registered celebrants to pay the registration charge (30 days, but 60 days during the first two years of enactment);26 and

• by foreshadowing, and raising awareness of, the potential introduction of the registration charge.27

Committee view

2.26 Marriage celebrants operate businesses and are paid for their services. Since Commonwealth-registered marriage celebrants are the clear users and financial beneficiaries of the Marriage Celebrants Program administered by the Department, the committee considers that they should contribute financially to its administration and maintenance. The proposals are fully consistent with the Australian Government's Cost Recovery Guidelines and have been the subject of extensive and ongoing consultations, and targeted awareness campaigns, since 2011.

2.27 In the circumstances, therefore, the committee does not consider the amount of the proposed charge to be unreasonable or excessive. The committee notes advice from the Department that the amount of $240 has been costed after taking into account the concerns of stakeholders (as expressed during the 2011 consultation process), balanced with the objective of providing improved services under the Marriage Celebrants Program. The committee also understands that the costing model will be reviewed before 1 July 2016.

24 Committee Hansard, 24 May 2013, p. 6.

25 Submission 108, p. 7.

26 Submission 108, p. 6.

27 Mr Peter Arnaudo, AGD, Committee Hansard, 24 May 2013, p. 12.

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2.28 In relation to de-registration as a consequence of non-payment of the charge, the committee agrees that such an approach is an 'uncomplicated, low-cost' procedure that will remove any non-practising or non-compliant celebrants from the register to assist in reducing the number of marriage celebrants in Australia. The committee considers that payment of the charge is a condition of being authorised to solemnise marriages in Australia as a marriage celebrant, and one with which a celebrant must comply if they wish to continue to solemnise marriages - in the same way that other professions and industries are regulated and required to pay registration fees as a condition of providing their services to the public.

2.29 Accordingly, the committee concludes that the bills should be passed.

Recommendation 1

2.30 The committee recommends that the Marriage Amendment (Celebrant Administration and Fees) Bill 2013 and the Marriage (Celebrant Registration Charge) Bill 2013 be passed.

Senator Trish Crossin

Chair

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APPENDIX 1

SUBMISSIONS RECEIVED

Submission Number Submitter

1 North Queensland Celebrants Networking Group

2 Australian Federation of Civil Celebrants

3 Ms Sheryl Massey

4 Mrs Roslyn McFarlane

5 Mr Brian Davies

6 Name Withheld

7 Mr Mario Anders

8 Ms Jacqueline Hope

9 Name Withheld

10 Ms Lee van Dyken-Schabe

11 Name Withheld

12 Ms Maxine Lowry

13 Ms Mi-Chelle Nixon-Young

14 Mr Ange Kenos

15 Ms Margaret McCormack

16 Mr Craig Moran

17 Name Withheld

18 Mr Greg Cudmore

19 Ms Heather Blackstock

20 Ms Sandra Hill

21 Name Withheld

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22 Name Withheld

23 Mr Philip Greentree

24 Name Withheld

25 Ms Jenny Grierson

26 Ms Ruth Pilens

27 Ms Sally Cant

28 Ms Narelle Tudehope

29 Name Withheld

30 Ms Ruth Cason

31 Mrs Jennifer Cram

32 Name Withheld

33 Mr Robert Smith

34 Ms Edith Rice

35 Coalition of Celebrant Associations

36 Ms Gina Callan

37 Mr Gordon Munday

38 Ms Sonia Collins

39 Name Withheld

40 Mr Val Dean

41 Mrs Yvonne Wood

42 International College of Celebrancy

43 Ms Claire Goodwin

44 Australian Marriage Celebrants

45 Name Withheld

46 Civil Celebrations Network

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47 Alliance of Celebrants Queensland

48 Marriage Celebrants Australia

49 Civil Celebrants Graduate Association (Monash)

50 Association of Civil Marriage Celebrants of Victoria

51 Ms Dawn Dickson

52 Ms Julie Dober

53 Name Withheld

54 Name Withheld

55 Ms Margaret MacGregor

56 Ms Leisa Stenton

57 Name Withheld

58 Mrs Patricia Howson

59 Ms Sharon Norris

60 Mr Dale Cole

61 Ms Robbie Fincham

62 Mrs Liz Pforr

63 Mrs Lisa Ambler

64 Ms Cheryl Langley

65 Ms Mary Sargent

66 Ms Karen Wilmot

67 Mr Stanislaw Karasinski

68 Mr Peter Hooper

69 Mrs Leanne Smith

70 Name Withheld

71 Name Withheld

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72 Mrs Jill Fry

73 Mrs Fiona Romanin

74 Ms Maarit Kasurinen

75 Ms Ann Browne

76 Ms Keri Alexander

77 Ms Sharon Dennis

78 Ms Cecilia Te Amo

79 Mr David Hart

80 Ms Judith Connor

81 Ms Rebecca Skinner

82 Ms Julie O'Kane-Ginn

83 Ms Marie McGrath-Kerr

84 Ms Helen Murray

85 Ms Rona Goold

86 Ms Beryl Stevens

87 Humanist Celebrant Network

88 Mr Trevor Warburton

89 Mrs Janette Butler-Grech

90 Name Withheld

91 Name Withheld

92 Name Withheld

93 Name Withheld

94 Name Withheld

95 South East Australia Civil Marriage Celebrants Association

96 Name Withheld

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97 Ms Alanne McIlroy de Baladron

98 Mrs Megan Wilson

99 Ms Michelle Paterson

100 Ms Janice Woolrych

101 Mr Lionel Goodacre

102 Name Withheld

103 Ms Merrilyn Williams

104 Ms Denise Edwards

105 Ms Diane Knevitt

106 Ms Fay Creighton

107 Mrs R L Bird

108 Attorney-General's Department

109 Mr Charles Foley

110 Ms Julie Weston

111 Ms Meg Boswell

112 Ms Jennifer Tighe

113 Name Withheld

FORM LETTERS RECEIVED

1 Form Letter 1 received from 16 submitters (this number includes variations of the form letter)

2 Form Letter 2 received from 6 submitters (this number includes variations of the form letter)

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ADDITIONAL INFORMATION RECEIVED

1 Document tabled by the Coalition of Celebrant Associations at public hearing on 24 May 2013

2 Response to question on notice provided by the Attorney-General's Department on 29 May 2013

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APPENDIX 2

WITNESSES WHO APPEARED BEFORE THE COMMITTEE

Canberra, 24 May 2013

ARNAUDO, Mr Peter, Assistant Secretary, Marriage and Intercountry Adoption, Attorney-General's Department

BOGAART, Ms Esther, Acting Principal Legal Officer, Marriage Law and Celebrants Section, Attorney-General's Department

DAVIS, Mrs Susan, Registrar of Marriage Celebrants, Marriage Law and Celebrants Section, Attorney-General's Department

GOOLD, Ms Rona, Secretary, Coalition of Celebrant Associations; Delegate, Civil Celebrations Network

MILSON, Mr Alan, Vice President, Australian Federation of Civil Celebrants

NAGEL, Mrs Gail, Public Officer, Coalition of Celebrant Associations; Delegate, Australian Marriage Celebrants

WERNER, Ms Yvonne, Minute Secretary, Coalition of Celebrant Associations; Delegate, International College of Celebrancy Alumni and Friends Association

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The Senate

Legal and Constitutional Affairs

Legislation Committee

Migration Amendment (Offshore Resources Activity) Bill 2013 [Provisions]

June 2013

233

© Commonwealth of Australia

ISBN: 978-1-74229-884-9

This document was produced by the Senate Legal and Constitutional Affairs Committee secretariat and printed by the Senate Printing Unit, Department of the Senate, Parliament House, Canberra.

234

iii

MEMBERS OF THE COMMITTEE

Members

Senator Patricia Crossin, Chair, ALP, NT

Senator Gary Humphries, Deputy Chair, LP, ACT

Senator Sue Boyce, LP, QLD

Senator Mark Furner, ALP, QLD

Senator Louise Pratt, ALP, WA

Senator Penny Wright, AG, SA

Participating Members

Senator Doug Cameron, ALP, NSW

Senator Michaelia Cash, LP, WA

Secretariat

Mr Tim Bryant Committee Secretary

Ms Sandra Kennedy Principal Research Officer

Ms Elise Williamson Administrative Officer

Suite S1.61 Telephone: (02) 6277 3560

Parliament House Fax: (02) 6277 5794

CANBERRA ACT 2600 Email: legcon.sen@aph.gov.au

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236

TABLE OF CONTENTS

MEMBERS OF THE COMMITTEE ............................................................. iii

RECOMMENDATION ................................................................................... vii

CHAPTER 1 ........................................................................................................ 1

INTRODUCTION .................................................................................................... 1

Background to the Bill ............................................................................................ 1

Purpose of the Bill .................................................................................................. 2

Conduct of the inquiry ............................................................................................ 2

Note on references .................................................................................................. 3

CHAPTER 2 ........................................................................................................ 5

KEY PROVISIONS OF THE BILL AND ISSUES RAISED .............................. 5

Key provisions of the Bill ....................................................................................... 5

Issues raised during the inquiry .............................................................................. 6

Committee view ...................................................................................................... 9

DISSENTING REPORT BY COALITION SENATORS ........................... 11 Introduction .......................................................................................................... 11

The purpose of the Bill ......................................................................................... 11

The value of the offshore oil and gas industry ..................................................... 12

Uncertainty of the actual offshore area subject to the Bill ................................... 13

Uncertainty of the number of foreign workers in the offshore maritime zone .... 14

Uncertainty of the cost to industry ....................................................................... 14

Constitutional uncertainty of the proposed amendments ..................................... 15

Submission to the inquiry by the Maritime Union of Australia (MUA) .............. 17

Lack of consultation ............................................................................................. 18

Conclusion ............................................................................................................ 19

APPENDIX 1 ..................................................................................................... 21

SUBMISSIONS RECEIVED ................................................................................. 21

APPENDIX 2 ..................................................................................................... 23

WITNESSES WHO APPEARED BEFORE THE COMMITTEE ................... 23

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vii

RECOMMENDATION

Recommendation 1

2.26 The committee recommends that the Bill be passed.

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240

CHAPTER 1

INTRODUCTION

1.1 On 30 May 2013, the Minister for Immigration and Citizenship,

the Hon Brendan O'Connor MP (Minister), introduced the Migration Amendment (Offshore Resources Activity) Bill 2013 (Bill) into the House of Representatives.1 On 18 June 2013, the Senate referred the provisions of the Bill to the Legal and Constitutional Affairs Legislation Committee (committee) for inquiry and report by 20 August 2013.2 In order to assist the parliament's timely consideration of the Bill, the committee decided to present its report for the inquiry on 25 June 2013.

Background to the Bill

1.2 In October 2012, the Australian Government announced that it would amend the Migration Act 1958 (Migration Act), to clarify the circumstances of persons working in offshore maritime zones.3 The announcement responded to the decision of the Federal Court of Australia in the case of Allseas Construction SA v Minister for Immigration and Citizenship (Allseas).4

1.3 Following this announcement, the Department of Immigration and Citizenship (DIAC) reviewed how best to apply the Migration Act to workers in offshore maritime zones. The Migration Maritime Taskforce (Taskforce) was established to conduct the review and explore options for legislative amendment. In his second reading speech, the Minister confirmed the government's decision to implement the key recommendations of the Taskforce,5 the primary effect of which was summarised in the Explanatory Memorandum (EM):

[T]he existing legislative framework that essentially provides that persons are in the migration zone based on where they are physically located [will] be supplemented with a new legislative concept. This new concept would provide that all offshore resource workers, including support staff, are taken to be in the migration zone when they are engaged to conduct or support

1 House of Representatives, Votes and Proceedings, No. 167—30 May 2013, pp 2317-2318.

2 Journals of the Senate, No. 148—18 June 2013, p. 4048.

3 The Hon Chris Bowen MP, Minister for Immigration and Citizenship, 'Government to legislate on visa status of offshore resource workers', Media Release, 15 October 2012.

4 [2012] FCA 529. The Federal Court of Australia held that, by operation of subsection 5(13) of the Migration Act 1958 (Migration Act), two pipe-laying vessels were not Australian resource installations and, as a result, the non-citizens working on those vessels were not within, or working within, the migration zone and in need of a visa: see Explanatory Memorandum (EM), p. 1.

5 The Hon Brendan O'Connor MP, Minister for Immigration and Citizenship, Second Reading Speech, House of Representatives Hansard, 30 May 2013, p. 9.

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activities regulated by Commonwealth, State and Territory legislation relating to the exploration and exploitation of Australia's natural resources.6

Purpose of the Bill

1.4 The Bill seeks to amend the Migration Act, to ensure that persons who participate in, or support, an 'offshore resources activity' are deemed to be in the 'migration zone', thereby requiring all non-citizens engaged in an 'offshore resources activity' to hold either a specific or permanent visa.7

1.5 The Minister explained that the proposed amendments address the 'gaps' highlighted by the Allseas decision, which 'undermine the integrity of Australia's migration program and the visa regime regulating work entitlements':

Without regulation there is a risk that foreign workers involved in the exploration and exploitation of Australia's natural resources and who therefore form part of the Australian employment sector are working under conditions and receiving wages that are below Australian standards. This reduces work opportunities for Australian citizens and permanent residents, as well as non-citizens who hold relevant visas permitting work.

It also puts businesses that only engage workers who hold valid visas to work at a competitive disadvantage.8

1.6 According to the EM, the proposed amendments will supplement the current legislative framework, which defines Australian resources installations and Australian sea installations as part of the 'migration zone'. Collectively, these provisions will ensure that workers in Australia's offshore resources industry are regulated and are required to hold the appropriate visas.9

Conduct of the inquiry

1.7 The committee wrote to 50 organisations, inviting submissions by 20 June 2013. Details of the inquiry, including the Bill and associated documents, were made available on the committee's website at www.aph.gov.au/senate_legalcon.

1.8 The committee received seven submissions, which are listed at Appendix 1. A public hearing was held in Canberra on 21 June 2013, and a list of witnesses who appeared before the committee at the hearing is at Appendix 2. The committee thanks those organisations and individuals who made submissions and gave evidence at its public hearing.

6 EM, p.1.

7 EM, pp 1, 10. The term 'migration zone' is defined in subsection 5(1) of the Migration Act.

8 The Hon Brendan O'Connor MP, Minister for Immigration and Citizenship, Second Reading Speech, House of Representatives Hansard, 30 May 2013, p. 8.

9 EM, p. 2.

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Note on references

1.9 References to the committee Hansard and House of Representatives Hansard are to the proof Hansard. Page numbers may vary between the proof and the official Hansard transcript.

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CHAPTER 2

KEY PROVISIONS OF THE BILL AND ISSUES RAISED

2.1 The Bill contains one schedule comprised of two Parts. Part 1 of Schedule 1 sets out the operative provisions, and Part 2 deals with the application of the amendments.

Key provisions of the Bill

2.2 Proposed new section 9A (item 6 of Schedule 1) will create a new framework to provide that persons in an area who participate in, or support, an 'offshore resources activity' are taken to be in the migration zone. Proposed new subsections 9A(1) and 9A(3) operate as the deeming provisions and proposed new subsection 9A(5) further defines what is an 'offshore resources activity'. Proposed new subsection 9A(6) will enable the Minister to make a determination, by legislative instrument, that further defines what is an 'offshore resources activity' for the purposes of proposed new subsection 9A(5).1

2.3 The intended effect of proposed new section 9A is to bring persons participating in, or supporting, an 'offshore resources activity' within the ambit of the Migration Act, thereby requiring these persons to hold visas.2 Proposed new subsections 41(2B) and 41(2C) (item 8 of Schedule 1) will then operate to ensure that all non-citizens engaged in an 'offshore resources activity' hold a specific visa or a permanent visa to participate in, or support, the relevant activity.3

2.4 The Explanatory Memorandum (EM) explains that the policy intent of proposed new subsections 41(2B) and 41(2C) is to enable the Department of Immigration and Citizenship (DIAC) to identify the number of non-citizens working in the offshore resources sector and obtain information about the work they are doing. The EM advises that 'without a specific visa for this work, this will not be possible'.4

1 EM, pp 9, 11. Proposed new section 9A will also clarify how the new framework will operate by deeming when persons are taken to be in Australia, taken to travel to Australia, taken to enter Australia and/or taken to leave Australia.

2 EM, p. 9.

3 EM, p. 10. The EM explains that this specific visa will be prescribed in the Migration Regulations 1994. See: EM, p. 22.

4 EM, p. 22.

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Issues raised during the inquiry

2.5 The committee received evidence in respect of proposed new section 9A (item 6 of Schedule 1). Issues raised by stakeholders related to the proposed new definition of 'an area' (proposed new subsections 9A(1) and 9A(5)) and the proposed power to enable the Minister to make determinations with respect to the definition of 'offshore resources activity' (proposed new subsection 9A(5)).

Concern about the definition of 'an area'

2.6 Proposed new section 9A (item 6 of Schedule 1) will have the effect of bringing persons participating in, or supporting, an 'offshore resources activity' within the operation of the Migration Act by ensuring that persons participating in, or supporting, an 'offshore resources activity' in a relevant area are required to hold a visa to work.

2.7 The meaning of 'an area' is not defined in proposed new subsection 9A(1). The EM states that the term has been left 'deliberately broad' and proposed new subsection 9A(1) relies on the definition set out in proposed new subsection 9A(5) to determine whether an 'offshore resources activity' is in 'an area':5

New paragraphs 9A(5)(a) and 9A(5)(b) do not attempt to exhaustively define the areas in which Australia has the jurisdiction to govern offshore resources activity. Instead new paragraphs 9A(5)(a) and 9A(5)(b) rely on the existing processes applied in the Offshore Petroleum Act and the Offshore Minerals Act, which authorise activities to be carried out in

Australia's offshore maritime zones, to suppose that these activities are carried out within Australia's jurisdiction. In other words, the limits of the ―area are intended to be determined with reference to a regulated operation or activity performed under a licence or a special purpose consent issued under these two Acts. These areas would include areas within Australia's [Exclusive Economic Zone (EEZ)] (beyond the limits of the territorial sea) and above Australia's extended continental shelf.6

2.8 While supportive of the Bill, the Australian Institute of Marine and Power Engineers (AIMPE), criticised the lack of a definition of 'an area' in proposed new subsection 9A(1) and suggested that rather than the words 'an area', the proposed section refer to the EEZ:

[The Bill]…should be improved to ensure that Australia's migration laws are effective in their application to persons working on offshore resources vessels throughout Australia's EEZ.7

5 EM, p. 11, 17.

6 EM, p. 17. Also see: p. 11.

7 Submission 3, [p. 1].

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2.9 The Maritime Union of Australia (MUA) disagreed with this suggestion however, stating that in its view the Bill '[d]oes not seek to over-reach Commonwealth regulation in relation to vessels navigating through the Australian EEZ to get to the area in which those vessels need to operate'.8

2.10 The MUA informed the committee that the Bill would provide certainty and should be passed 'immediately without amendment':

It provides the certainty that the workforce, resource owners, operators and contractors have been seeking for a long time, and will ensure that tendering for offshore construction work will be undertaken on the basis of certainty as to what Australian labour relations arrangements apply, thus

creating a basis for tenderers to have a known labour cost structure which cannot be undercut by competitors.9

2.11 Not all submitters however were supportive of the Bill. Shipping Australia Limited (SAL) informed the committee that in its opinion the amendments 'set out in the Bill are unnecessary as the current Act is consistent with international standards of practice in the offshore resource sector'.10 SAL called on the committee to retain the status quo, stating that, in its opinion, the Migration Act 'sufficiently [covers] visa requirements for special skilled workers when operating within Australia's territorial seas and on Australian vessels'.11

2.12 Similarly, the Australian Mines and Metals Association (AMMA) contended that the Migration Act does not require amendment in respect of offshore resource workers as the relevant provisions:

…already clearly require a non-Australian person working on a vessel to hold a visa if the vessel enters Australia's territorial sea or the non-citizen transits through Australia in order to join or depart the vessel.12

Government response

2.13 Mr David Wilden, Acting First Assistant Secretary, Migration and Visa Policy Division, from the Department of Immigration and Citizenship (DIAC), advised the committee that if a person enters the migration zone they require a visa:

The reason for this bill is that there was a presumption, I guess because it had never been tested, that international crew on these certain vessels were already holding visas…and the anomaly was when it became apparent that they were not. …The purpose of this [Bill] is purely and simply to regulate those people who, by the Allseas decision, are deemed not to be in the

8 Submission 4, p. 2.

9 Submission 4, p. 1.

10 Submission 1, p. 1.

11 Submission 1, p. 2.

12 Submission 5, p. 3.

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migration zone; to amend the migration zone, which has not been an irregular occurrence over the years, to include them.13

2.14 DIAC further explained that the changes proposed by the Bill 'clarify the situation around foreign workers in Australia's offshore maritime zones'.14

Ministerial determination

2.15 Submitters also commented on proposed new subsection 9A(6), which provides the Minister with the authority to make a determination with respect to the definition of 'offshore resources activity'.

2.16 The EM states that the inclusion of proposed new subsection 9A(6):

Provide[s] the Minister with the flexibility and ability to exempt certain activities administered by the Offshore Petroleum Act and the Offshore Minerals Act from the definition of offshore resources activity…[and provides] the Minister with the ability to capture certain other activities not

administered by these two Acts but administered by a law of the Commonwealth, a State or a Territory…[and]…will also provide the Minister with an additional tool to ensure that any future emergency can be effectively dealt with and to exclude any unintended consequences which may breach Australia's international obligations.15

2.17 The AMMA considered proposed new subsection 9A(6) to be an inappropriate delegation of legislative power. The AMMA were of the view that as the determination made by the Minister (pursuant to proposed new subsection 9A(6)) will be a legislative instrument exempt from disallowance,16 it does not provide sufficient parliamentary scrutiny of the legislative power delegated to the Minister.17

Government response

2.18 Representatives from DIAC explained that proposed subsection 9A(6) provides for the Minister to respond to the unknown and to do so promptly:

[A] power for the Minister to make a determination in writing for the purposes of defining offshore resources activity…will provide the Minister with flexibility to declare certain activities administered by other regulatory

13 Committee Hansard, 21 June 2013, p. 14.

14 Submission 7, p. 3.

15 EM, pp 18-19.

16 Proposed new subsection 9A(7) provides that determinations made under proposed new subsection 9A(6) are legislative instruments but are not subject to section 42 (disallowance) of the Legislative Instruments Act 2003 pursuant to section 44 of that Act.

17 Submission 5, pp 11-12. The Australian Shipowners Association (ASA) also raised concerns in relation to proposed new subsection 9A(6) stating that it is 'not clear how a Ministerial determination of what constitutes an 'offshore resources activity' would work with respect to these vessels'. See: Submission 2, p. 2.

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schemes as offshore resource activities for the purposes of the new deemed migration zone.18

Committee view

2.19 The committee notes the value of the liquefied natural gas (LNG) industry to Australia.19 As the growth of the offshore petroleum industry is accompanied by a skills shortage,20 the committee takes the view that Australia's migration and visa regime must facilitate the flexibility required to attract the appropriate skills to the sector and provide certainty and clarity for the industry. The committee considers that the Bill will provide the necessary certainty and flexibility.

2.20 The committee considers that the Bill will also ensure that the employment conditions of foreign workers undertaking activities involved in the exploration and exploitation of Australia's natural resources are being properly regulated.

2.21 The committee notes the concerns raised by stakeholders in relation to the government's consultation process however is satisfied that the Taskforce did consult with a wide range of stakeholders including:

…the Australian Maritime Officers Union, the Maritime Union of Australia, the AMWU…the AIMPE, the AWU, the Australian Petroleum Production and Exploration Association, Allseas, McDermott, Saipem, Woodside, Chevron, the Chamber of Commerce and Industry of Western Australia, and a long list of departments as well, at both state and Commonwealth level.21

2.22 The committee further notes that DIAC confirmed that a future consultation process will occur on the 'mechanics' of the visa:

…the next consultation period [will go] to the mechanics…the way [the visa] would probably work…that goes to the specific issues of e-lodgement, a suitable visa charge and…the mechanism[s] behind it.22

2.23 The committee takes the view that the concerns of stakeholders in relation to uncertainty will be addressed through this next round of consultation. Further, the committee is satisfied that the introduction of the new specified visa (the details of

18 Submission 7, p. 4.

19 The Department of Resources, Energy and Tourism noted that in 2011-12 Australia exported 19.3 million tonnes of LNG valued at around $12 billion. Forecasts indicate that in 2012-13 the value of LNG exports will increase to $16.3 billion. Australia is the fourth largest LNG exporter. Export capacity is expected to grow from the current 24 million tonnes per annum to exceed 80 million tonnes per annum by 2016-17. See: Submission 6, [p. 1].

20 Submission 6, [p. 1].

21 Committee Hansard, 21 June 2013, p. 16.

22 Committee Hansard, 21 June 2013, p. 15.

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which will be set out in Regulations after industry consultation) will not result in a significant burden for the offshore resources industry nor will it affect investment.

2.24 The committee notes that the commencement provisions set out in the Bill allow adequate time for DIAC to consult with key stakeholders and States and Territories for the purposes of developing the special visa, defining 'offshore resources activity' and exempting certain activities. The committee takes the view that this should enable the concerns raised by stakeholders to be resolved prior to the commencement of the provisions.

2.25 The committee also notes Australia's sovereign rights under the United Nations Convention on the Law of the Sea Australia (UNCLOS) to apply its immigration laws to foreign nationals on foreign-flagged and Australian-flagged vessels which are engaged in the exploration and exploitation of natural resources and which are located in Australia’s territorial sea, contiguous zone, EEZ or in the waters above its extended continental shelf.23

Recommendation 1

2.26 The committee recommends that the Bill be passed.

Senator Trish Crossin

Chair

23 Submission 7, p. 6. Article 56(1) of UNCLOS provides Australia with sovereign rights for the purpose of exploring and exploiting the natural resources of the EEZ. The jurisdiction accorded to Australia by Article 56(1) must, by operation of Article 56(2), be exercised with due regard to the rights and duties of other States. The effect of the proviso in Article 56(2) is to ensure that vessels that are not engaged in activities for which the coastal State has jurisdiction under Article 56(1) are not unduly hindered by the activities of the coastal State, and that freedoms such as freedom of navigation, freedom to lay cables and pipelines (which do not come to Australia) and other high seas freedoms are preserved. Coastal states which permit foreign vessels and structures to engage in exploration and exploitation of natural resources within their EEZ or their continental shelf do so on conditions which include the regulation of a number of matters which would, on the high seas, be the preserve of the flag state. See: Submission 7, pp 6-7.

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DISSENTING REPORT BY COALITION SENATORS

The Migration Amendment (Offshore Resources Activity) Bill Introduction

1.1 The Migration Amendment (Offshore Resources Activity) Bill 2013 (the Bill) amends the Migration Act 1958 (the Act) to provide that persons who participate in, or support, an offshore resources activity are taken to be in the migration zone as defined by section 5 of the Act.

1.2 The Bill also proposes to insert a new section 9A of the Act which creates a new framework that provides that persons in an area participating in, or supporting, an offshore resources activity are taken to be in the migration zone (the deeming provision).

1.3 New section 9A further clarifies how this new framework operates by deeming when persons are taken to be in Australia, taken to travel to Australia, taken to enter Australia and or taken to leave Australia.

1.4 The Bill was introduced by the Government to override the decision of the Federal Court in Allseas Construction S.A. v Minister for Immigration and Citizenship [2012] FCA 529 in which McKerracher J inter alia held that section 5(13)(b) of the Act excludes vessels that are wholly or principally engaged in operations relating to the installation of offshore pipelines.

1.5 Paragraph 5(13)(b) of the Act excludes a vessel that is used or is to be used wholly or principally in operations or activities associated with, or incidental to, activities of manoeuvring a resources installation, or in operations relating to the attachment of a resources installation to the Australian seabed.

1.6 The Federal Court decision has the effect of excluding foreign workers aboard exempted vessels from the visa requirements applicable to vessels entering the "migration zone" as defined in the Act.

The purpose of the Bill

1.7 The purpose of the Bill is to regulate foreign workers participating in offshore resources activities by bringing those persons into the migration zone and thereby requiring them to hold a visa under the Act.1

1 Department of Immigration and Citizenship, Submission 7, p. 4.

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1.8 In the Second Reading Speech the Minister claims the Bill will overcome a "loophole" identified in the Allseas case which needed to be closed.

1.9 Coalition Senators consider that an objective reading of the Allseas case indicates that no loophole was opened by Allseas, and that the decision of the Federal Court provided clarity and allowed the industry to proceed consistent with previous Australian and international practice.

1.10 The Allseas litigation was initiated to confirm a standing interpretation of Australian law, which was consistent with international law.

1.11 Contrary to the claims of the Minister there was no loophole that needed to be closed.

1.12 Coalition Senators are concerned that the Bill is not being introduced as a measure of considered public policy, but rather it is being introduced for ideological purposes, at the urging of the Maritime Workers Union (MWU) who have been significant donors to the Labor Party over many years, to override the decision of the Federal Court in Allseas Construction S.A. v Minister for Immigration and Citizenship [2012] FCA 529.

The value of the offshore oil and gas industry

1.13 Coalition Senators acknowledge the value of the offshore oil and gas industry to the national economy and are concerned that the additional regulatory burden and associated costs the Bill introduces may discourage further investment in this productive sector.

1.14 The Minister in the Explanatory Memorandum (EM) tabled with the Bill acknowledges the economic value of exploration and exploitation of the natural resources in the offshore maritime zones:

The exploration and exploitation of the natural resources in Australia's offshore maritime zones contributes significantly to the Australian economy and employs thousands of Australian workers.2

1.15 The Australian Mines and Metals Association (AMMA) in their oral evidence to the inquiry stated:

Annually, Australia's oil and gas industry contributes 2½ per cent of our GDP, generates $28 billion in revenue and yields almost $9 billion in direct tax payments. Offshore oil and gas meets 58 per cent of Australia's primary energy needs and is critical to our current and future energy security.

Australian jobs and our overall economic success relies on a confident, growing offshore oil and gas industry able to do business consistent with international laws and practices on, for example, specialist access to

2 EM, p. 2.

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infrastructure and services. With this much at stake, it is vital that sectional interests do not come before the national interest and that parliament delivers sustainable, proportionate and balanced regulation affecting offshore operations.3

Uncertainty of the actual offshore area subject to the Bill

1.16 Coalition Senators are concerned that the specific offshore area subject to the Bill is not defined.

1.17 Coalition Senators do not consider the Senate should agree to legislation which is to apply to an "unknown or uncertain" offshore area.

1.18 Coalition Senators note that the uncertainty of the area, the subject of the Bill, was raised in the written submission of the Australian Institute of Marine and Power Engineers (AIMPE).

1.19 The AIMPE expressed its concern in the following terms:

It is submitted that the way to avoid the enforcement nightmare and ensure comprehensive application of Australia’s migration laws to personnel on vessels engaged in offshore resources activity is the delete the references to "in an area" and replace them with the concept of the Exclusive Economic Zone.4

1.20 Mr Scott Barklamb, Executive Director, AMMA, in his oral evidence to the inquiry also expressed his concern at the uncertainty of the extent of the area to be subject to the provisions of the Bill in the following terms:

We say that it is also important to understand the significance of what is being proposed. The exclusive economic zone is larger than our entire landmass. This Bill would expand Australia's legal territory for the purposes of migration by 10 million square kilometres.

The proposal to extend our federal laws, including the Fair Work Act, to this vast area does not amount to a mere tweaking or closing a loophole. It is a radical change that would more than double the reach of our Australian laws, and would do so in a manner unknown and inconsistent with our international legal obligations. Whether this is reach or overreach is a live point, and it is considerably enlivened, we say, by both the legal and regulatory concerns we raised.5

3 Mr Scott Barklamb, Executive Director, Australian Mines and Metals Association, Committee Hansard, 21 June 2013, p. 6.

4 Submission 3, p. 1.

5 Committee Hansard, 21 June 2013, p. 7.

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Uncertainty of the number of foreign workers in the offshore maritime zone

1.21 Coalition Senators are concerned that the Government is unable to quantify the number of foreign workers in the offshore maritime zone which appears to be related to the inadequate consultative process with industry and other parties.

1.22 The inability of the Government or the Minister to quantify, or even estimate, the potential number of foreign workers in the offshore maritime zone casts doubt on the veracity of other statements contained in the Second Reading Speech and associated documents tabled in the Senate:

Under the current legislative framework, the Government has an incomplete picture of the number of foreign workers in the offshore maritime zone.6

Uncertainty of the cost to industry

1.23 Should the Bill be passed by the Parliament in its current form it will give greater control of employment of foreign workers on vessels within the migration zone to the MWU.

1.24 Coalition Senators are concerned that the MWU will seek to use the additional power this Bill will bestow on the union to impose outrageous wage demands on employers who are required to rely on union labour.

1.25 The recent demands of the MWU in seeking to have cooks on offshore north-west gas projects paid $230,000.00 annually is evidence of the tactics employed by the MWU.7

1.26 Coalition Senators are concerned that the Regulation Impact Statement (RIS), tabled by the Minister with the Bill, is unable to quantify the potential cost impact on employers and the number of people who are likely to be affected by the provisions of the Bill.

1.27 This uncertainty is reflected in the RIS which indicates that:

…according to Western Australian Government figures, somewhere between 6000 and 8000 workers are currently employed in the offshore resources sector, but it is unclear how many of these workers are non-citizens.8

6 EM, p. 2.

7 'MWU wants gas plant cooks paid $230,000 annually', Perth Now, 14 May 2013 http://www.perthnow.com.au/news/western-australia/gas-plant-cooks-want-230000/story-fnhocxo3-1226642040247, (accessed 23 June 2013).

8 RIS, p. 4.

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1.28 Whist the Government is unable to quantify the number of foreign workers caught by the provisions of the Bill, the RIS makes it clear that additional fees will be payable by operators for visas required by the foreign workers.

1.29 Whilst the quantum of the relevant fees is not yet settled, Coalition Senators note that 457 visas will increase from $455.00 to $900.00 on July 1st 2013.

1.30 At the committee's public hearing on 21 June 2013, Senator Cash sought further comment from the AMMA on the statement, in their written submission to the inquiry, relating to cost pressures on the resource industry in which they stated:

Enactment of the Bill would place untenable cost pressures on the resource industry. The cost pressures would be both direct and indirect, in terms of compliance and administration costs.9

1.31 Mr Scott Barklamb, AMMA, stated:

The particular piece of infrastructure work at hand is highly specialised international vessels that sail global waters and assist with the laying of pipes, the moving of infrastructure and the assembly of infrastructure in international waters. If we either delay or complicate or render more costly those inputs to our built offshore infrastructure we complicate, delay and add costs to either the repair and maintenance or the bringing on line of new offshore resource projects. What does that do? That makes them slower to come on line and create jobs in this country and it makes them more costly, and those costs are weighed by international investors.

Australia is not the only place in the world with offshore oil and gas resources. International investors are all too aware of and are in the business of evaluating competing resource destinations.10

Constitutional uncertainty of the proposed amendments

1.32 Coalition Senators believe that the scope of the Bill is extremely wide and may breach Australia’s obligations in respect to the United Nations Convention on the Law of the Sea 1982 (UNCLOS), which Australia ratified in 1992.

1.33 Coalition Senators acknowledge that Australia has, at international law, a sovereign right to explore and exploit the natural resources occurring in the exclusive economic zone (EEZ) and the extended continental shelf (ECS).

1.34 Australia is limited by the provisions of the UNCLOS convention which does not empower Australia to dictate the employment conditions of maritime personnel in the EEZ or the ECS, as these responsibilities are matters for the flag State of the

vessel.

9 Submission 5, p. 19.

10 Committee Hansard, p. 8.

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1.35 As a signatory to UNCLOS, Australia agreed to be bound by the provisions of the convention agreement and is required to act within the terms of the agreement.

1.36 Coalition Senators are concerned at the inconsistent advice given to the inquiry by the Department of Immigration and Citizenship (DIAC) and various submitters on the constitutional validity of the proposed amendments.

1.37 Coalition Senators are concerned that the Minister has not provided the Senate with compelling evidence that the scope of the Bill and its specific provisions do not breach Australia’s international obligations.

1.38 The failure of the Minister to adequately demonstrate that the Government has adequately considered the totality of the complex issues relating to the law of the sea and Australia’s international obligations may render the provisions of the Bill invalid.

1.39 Coalition Senators are concerned by the failure of the Minister to distinguish a range of activities that occur as a consequence of vessels at sea. These include where a vessel is transiting through the migration zone, entering an Australian port, or is doing specific work in international waters and not entering the Australian regulatory sphere for employment and migration law.

1.40 Many of the preceding concerns were raised by the AMMA in both their written submission and oral evidence to the inquiry.

1.41 At paragraphs 53-57 of their written submission, AMMA expressed their concerns in the following terms:

Proposed section 9A would deem an offshore resource worker to be within the migration zone, and within Australia, even if he or she were a non-citizen on a foreign-flagged vessel transiting through the EEZ or the waters above the ECS.

Proposed section 9A(6) would allow the Minister to declare an activity in or out of Australia.

The proposed extension of the application of the Migration Act in this way would be:

a. An inappropriate delegation of legislative power.

b. Incompatible with human rights principles.

c. Inconsistent with Australia’s international obligations.

d. Inconsistent with Australia’s constitutional arrangements.

e. Inconsistent with the Offshore Constitutional Settlement 1973

f. Inconsistent with industry practices and impractical

g. Damaging to the Australian economy and Australian jobs

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Information about these matters has not been provided to the Parliament by the Minister. Unless the Parliament is able to give due consideration to these matters, the legislation should not be passed.11

Submission to the inquiry by the Maritime Union of Australia (MUA)

1.42 Coalition Senators note that the MUA has made representations to the Government for the Act to be amended following the decision of the Federal Court in Allseas Construction S.A. v Minister for Immigration and Citizenship [2012] FCA 529.

1.43 The MWU in its submission to the inquiry indicated its support for the Bill and made a number of points in favour of its carriage. The MWU stated that the Bill:

- Closes an unintended gap in the Migration Act 1958.

- Provides certainty for the workforce, resource owners, operators, and contractors.

- Creates a level playing field so that all workers irrespective of origin can have their migration status and employment standards regulated.

- Ends exploitation of temporary guest workers in the offshore oil and gas industry and will ensure that employment, safety and training and occupational licensing requirements can be bought up to Australian legal and industrial standards.

- Will provide the Government with the capacity to monitor non-nationals working on critical resource projects.12

1.44 In response to the specific issues raised by the MWU, Coalition Senators note that:

(a) A close reading of the parliamentary debates relating to the Migration Act 1958 and subsequent amendments, indicate that there is no unintended gap and that the Parliament intended that certain foreign workers would be excluded in the visa requirements related to the migration zone whilst they were manning a vessel that is used or is to be used wholly or principally in operations or activities associated with, or incidental to, activities of manoeuvring a resources installation, or in operations

relating to the attachment of a resources installation to the Australian seabed.

(b) Far from providing certainty for the workforce, resource owners, operators, and contractors, the Bill raises constitutional issues and is likely to be in breach of Australia’s international obligations.

(c) Imposing Australian regulations on the employment conditions of foreign workers on vessels excluded by paragraph 5(13)(b) of the Act would be void.

11 Submission 5, p. 11.

12 Submission 4, p. 1.

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(d) The submission of the MWU provides no evidence of exploitation of temporary guest workers in the offshore oil and gas industry.

(e) Project costs would increase substantially if foreign workers employed on vessels excluded by paragraph 5(13)(b) of the Act, particularly on short term contracts, are subject to Australian employment, safety and training and occupational licensing requirements.

(f) Foreign workers employed on vessels excluded by paragraph 5(13)(b) of the Act are already subject to severe restrictions whilst working offshore in the migration zone and are not entitled to be onshore without an appropriate visa.

Lack of consultation

1.45 The provisions of the original Migration Act 1958 and subsequent amendments have, in the past, been the subject of lengthy and detailed consultation with interested parties given its international application and its impact on international and domestic obligations.

1.46 Coalition Senators are concerned that the passage of the Bill is being progressed by the Government with indecent haste and without appropriate consultation with affected parties.

1.47 Given the scope of the proposed amendments and the impact of the Bill on Australia’s international and domestic obligations, Coalition Senators consider the manner in which the Government is attempting to progress and its inability to clarify with certainty the impact of the Bill on affected parties is both cavalier and arrogant.

1.48 Coalition Senators note that in his Second Reading Speech on the Bill, the Minister for Immigration and Citizenship claimed there had been extensive stakeholder consultation on the Bill with the offshore resources industry, unions and other Commonwealth agencies.

1.49 The Minister’s statement on consultation is inconsistent with evidence given to the inquiry by various submitters:

The more our industry knows about this bill and how the minister intends to proceed, the less certain it becomes. We have absolutely no certainty. We do not believe that we will gain any certainty from the passage of this bill. It will open up myriad areas of uncertainty, as our submission makes clear. Through the committee, we can communicate back to the minister that we believe that the rush and the fundamentally wrong-directed thinking behind this bill will cause some difficulties.

I might also add that, on the consultation arrangements we were talking about earlier—and I am indebted to my colleagues for raising it with me—a

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DIAC task force exercise was undertaken. We have not seen the task force report from DIAC.13

1.50 Coalition Senators believe that consultation referred to by the Minister was not on the legislation that is before the Senate, but relates to more amorphous concepts and principles that preceded the drafting of the Bill.

1.51 In his claims about consultation the Minister fails to identify any organisation that was invited to comment on the Bill as drafted.

Conclusion

1.52 Coalition Senators do not support the Bill in its current form for the following reasons:

(a) The Minister has failed to provide documentation to show that the Bill meets Australia’s international obligations as they apply to the laws of the sea.

(b) On the evidence available to Coalition Senators, the Bill is not being introduced as a measure of considered public policy, but rather it is being introduced for ideological purposes, at the urging of the MWU who have been significant donors to the Labor Party over many years, to override the decision of the Federal Court in Allseas Construction S.A. v Minister for Immigration and Citizenship [2012] FCA 529.

(c) The Minister fails to recognise the value of the offshore oil and gas industry to the national economy and the extent of the negative impact the Bill will have on affected parties.

(d) The Minister fails to understand the impact of the additional regulatory burden and associated costs the Bill will create.

(e) The Minister fails to understand that additional burdensome regulation may discourage further investment in this productive sector.

(f) The Minister has failed to adequately define the extent of the area to be subject to the Bill and seeks to avoid identifying the specific area by indicating that this detail will be fleshed out at a later date.

(g) If the Minister cannot define the extent of the area to be subject to the Bill how can he provide certainty that Australia is not in violation of its international obligations.

(h) The Minister has failed to quantify the potential cost impact on employers and number of people who are likely to be affected by the provisions of the Bill.

13 Committee Hansard, 21 June 2013, p. 11.

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(i) The Minister has failed to provide certainty that the MWU will not seek to use the additional power this Bill will bestow on the union to impose outrageous wage demands on employers who are required to rely on union labour.

(j) The scope of the Bill is extremely wide. Given the lack of certainty in the advice provided by the Minister, the Bill may breach Australia’s obligations in respect to the United Nations Convention on the Law of the Sea, 1982 (UNCLOS) which Australia ratified in 1992.

(k) The failure of the Minister to adequately demonstrate that the Government has adequately considered the totality of the complex issues relating to the law of the sea and Australia’s international obligations may render the provisions of the Bill invalid.

(l) It is clear from the evidence of a number of affected parties that the Minister has failed to adequately consult with industry and that the limited consultation that the Minister claims occurred was limited to amorphous concepts and principles that preceded the drafting of the Bill.

Recommendation 1

1.7 Coalition Senators recommend that the Bill not be passed.

Senator Gary Humphries Senator Sue Boyce

Deputy Chair

Senator Michaelia Cash

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APPENDIX 1

SUBMISSIONS RECEIVED

Submission Number Submitter

1 Shipping Australia Limited

2 Australian Shipowners Association

3 Australian Institute of Marine and Power Engineers

4 Maritime Union of Australia

5 Australian Mines and Metals Association

6 Department of Resources, Energy and Tourism

7 Department of Immigration and Citizenship

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APPENDIX 2

WITNESSES WHO APPEARED BEFORE THE COMMITTEE

Canberra, 21 June 2013

BARKLAMB, Mr Scott Cameron, Executive Director, Industry, Australian Mines and Metals Association

BARTLETT, Mr Andrew, Research Fellow, Migration Law Program, College of Law, Australian National University

COPLEY, Mrs Julie Jane, Policy Manager, Australian Mines and Metals Association

DUNCAN, Mr Philip James, Lecturer, Migration Law Program, Legal Workshop, Australian National University

MONTGOMERY, Ms Sophie, Assistant Secretary, Education, Tourism and International Arrangements, Migration and Visa Policy Division, Department of Immigration and Citizenship

WILDEN, Mr David, Acting First Assistant Secretary, Migration and Visa Policy Division, Department of Immigration and Citizenship

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The Senate

Legal and Constitutional Affairs

Legislation Committee

Migration Amendment (Temporary Sponsored Visas) Bill 2013 [Provisions]

June 2013

265

© Commonwealth of Australia

ISBN: 978-1-74229-879-5

This document was produced by the Senate Legal and Constitutional Affairs Committee secretariat and printed by the Senate Printing Unit, Department of the Senate, Parliament House, Canberra.

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iii

MEMBERS OF THE COMMITTEE

Members

Senator Patricia Crossin, Chair, ALP, NT

Senator Gary Humphries, Deputy Chair, LP, ACT

Senator Sue Boyce, LP, QLD

Senator Mark Furner, ALP, QLD

Senator Louise Pratt, ALP, WA

Senator Penny Wright, AG, SA

Participating Members

Senator Doug Cameron, ALP, NSW

Senator Michaelia Cash, LP, WA

Senator Sarah Hanson-Young, AG, SA

Secretariat

Mr Tim Bryant Inquiry Secretary

Ms Ann Palmer Principal Research Officer

Ms Elise Williamson Administrative Officer

Ms Morana Kavgic Administrative Officer

Suite S1.61 Telephone: (02) 6277 3560

Parliament House Fax: (02) 6277 5794

CANBERRA ACT 2600 Email: legcon.sen@aph.gov.au

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268

TABLE OF CONTENTS

MEMBERS OF THE COMMITTEE ............................................................. iii

RECOMMENDATION ................................................................................... vii

CHAPTER 1 ........................................................................................................ 1

INTRODUCTION .................................................................................................... 1

Purpose of the Bill .................................................................................................. 1

Overview of the Bill ............................................................................................... 2

Conduct of the inquiry ............................................................................................ 5

Acknowledgement .................................................................................................. 5

Note on references .................................................................................................. 5

CHAPTER 2 ........................................................................................................ 7

KEY ISSUES ............................................................................................................. 7

Need for a labour market testing condition for subclass 457 visas ........................ 7

Impact of labour market testing ............................................................................ 11

Committee view .................................................................................................... 16

DISSENTING REPORT BY COALITION SENATORS ............................ 19 The Migration Amendment (Temporary Sponsored Visas) Bill 2013 ................. 19

Overview of the 457 visa program ....................................................................... 19

Lack of Consultation in relation to the Bill .......................................................... 22

Deliberate campaign to undermine 457 visa program .......................................... 23

Claims of rorting by the CFMEU and the TWU .................................................. 27

Office of the Prime Minister - Mr John McTernan ............................................. 28

Coalition Senators' conclusions on allegations of rorting the 457 visa program . 29

Labor Market Testing (LMT) ............................................................................... 30

Failure of government to provide a Regulation Impact Statement (RIS) ............ 35

Minister O'Connor's misrepresentations on what LMT is .................................... 40

Conclusions - Coalition Senators ......................................................................... 41

APPENDIX 1 ..................................................................................................... 43

SUBMISSIONS RECEIVED ................................................................................. 43

269

APPENDIX 2 ..................................................................................................... 47

WITNESSES WHO APPEARED BEFORE THE COMMITTEE ................... 47

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vii

RECOMMENDATION

Recommendation 1

2.37 The committee recommends that the bill be passed.

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CHAPTER 1 INTRODUCTION

1.1 On 6 June 2013, the Migration Amendment (Temporary Sponsored Visas) Bill 2013 (Bill) was introduced by the Minister for Immigration and Citizenship, the Hon Brendan O'Connor MP (Minister).1 On 18 June 2013, the Senate referred the provisions of the Bill to the Senate Legal and Constitutional Affairs Legislation Committee (committee) for inquiry and report by 20 August 2013.2 In order to assist the parliament's timely consideration of the Bill, the committee decided to present its report on 24 June 2013.

Purpose of the Bill

1.2 According to the Explanatory Memorandum (EM), the Bill seeks to:

[Amend] the Migration Act 1958 (the Migration Act) to enhance the Government's ability to deter sponsor behaviour which is inconsistent with the policy intent of the Temporary Sponsored Visa Program (of which Subclass 457 visas are a part). The Bill, together with proposed amendments to the Migration Regulations 1994 (the Migration Regulations), presents a comprehensive package of reform which would balance the interests of Australian workers with the need to strengthen protections for overseas workers.3

1.3 In his Second Reading Speech, the Minister set out the government's concerns regarding the current operation of the subclass 457 visa protection scheme:

[T]he subclass 457 visa plays an important role in allowing employers to address skill shortages when skilled local labour is unavailable. It is intended as a vehicle to allow employers to quickly supplement the

Australian labour market, including the use of enterprise migration agreements and regional migration agreements, where a genuine skill shortage exists…

The use of the subclass 457 visa program has been growing strongly in recent years…

Many growing industries, including those connected with the resources boom, such as mining, as well as non-resource-sector users of the program, such as health care and information and communications technology, accounted for a large portion, over half, of all subclass 457 visa grants in 2011-12.

However, strong growth has also been recorded in industries in which employment has fallen recently, such as accommodation and food service, and retail trade.

1 Votes and Proceedings, No. 171, 6 June 2013, p. 2383.

2 Journals of the Senate, No. 148, 18 June 2013, pp 4048-4050.

3 Explanatory Memorandum (EM), p. 1.

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It concerns the government that, at a time when the labour market has been flattening and some sectors and regions have experienced lay-offs and increased unemployment, the subclass 457 program has continued to grow.

Coupled with this strong growth is a tendency for some employers to source foreign labour through the subclass 457 program without regard to the Australian domestic labour force.

These trends highlight that current requirements do not commit sponsors to using the subclass 457 program as a supplement to, rather than a substitute for, the domestic labour force.4

Overview of the Bill

1.4 The Bill has six schedules. According to the EM, the Bill would amend the Migration Act to:

• reinforce the purpose of Division 3A of Part 2 of the Migration Act relating to sponsorship;5

• require prescribed classes of sponsors to undertake labour market testing in relation to a nominated occupation, in a manner consistent with Australia's international trade obligations;

• provide the evidence for labour market testing which is to accompany an application for a nomination;

• provide exemptions from labour market testing in circumstances where there has been a major disaster, or the skill level of the nominated occupation is equivalent to Skill level 1 or Skill Level 2 as provided for in the Australian and New Zealand Standard Classification of Occupations (ANZSCO);

• in relation to exemptions from labour market testing, provision for the Minister, by way of legislative instrument, to specify the occupations and for such legislative instruments to be subject to disallowance by either House of the Parliament;

• enshrine the kinds of sponsorship obligations for which the Minister must take reasonable steps to ensure are prescribed in the Migration Regulations;

• enhance the enforcement framework in relation to sponsorship to include enforceable undertakings between the Minister and an approved sponsor or former approved sponsor and the enforcement of those undertakings;

• empower Fair Work Inspectors to be inspectors under the Migration Act;

4 The Hon Brendan O'Connor MP, Minister for Immigration and Citizenship, Second Reading Speech, House of Representatives Hansard, 6 June 2013, p. 1.

5 Proposed new section 140AA (item 1 of Schedule 1) sets out broad principles to reinforce the importance of temporary skilled workers to the Australian economy while protecting Australian businesses and the employment and training of Australian citizens and Australian permanent residents. See: EM, p. 5.

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• clarify that entry to premises under the Fair Work Act 2009 will enable a Fair Work Inspector to exercise powers under the Migration Act; and

• provide that an additional purpose for exercising inspector powers under the Migration Act is to determine whether a person who is or was an approved sponsor has contravened a civil penalty provision in or committed an offence against relevant provisions of the Migration Act relating to work (employer sanctions provisions).6

1.5 The majority of submissions were concerned with the provisions in relation to labour market testing conditions, which are set out in Schedule 2.

Labour market testing (Schedule 2)

1.6 In his Second Reading Speech, the Minister noted that the government 'will seek assurance from employers that they are only utilising the 457 visa program in circumstances where there is a genuine skills shortage in Australia'.7 To enable this outcome, Schedule 2 of the Bill introduces a requirement that sponsors must undertake labour market testing in relation to nominated occupations in a manner consistent with Australia's relevant international trade obligations (item 2 of Schedule 2, proposed new subsection 140GBA(1)).

1.7 The labour market testing conditions are satisfied if:

• the Minister is satisfied that the sponsor has undertaken labour market testing in relation to the nominated position within a period determined by the Minister, by legislative instrument, in relation to the nominated occupation;8 and

• the nomination is accompanied by evidence in relation to that labour market testing; and

• having regard to that evidence, the Minister is satisfied that a suitably qualified and experienced Australian citizen or Australian permanent resident is not readily available to fill the nominated position.9

1.8 In relation to the period of labour market testing required, the Minister stated:

It is proposed that the labour market testing requirement will initially require a sponsor to demonstrate that they have sought to find a suitably qualified Australian citizen or Australian permanent resident within six months prior to submission of an application for nomination approval.10

6 EM, p. 1.

7 The Hon Brendan O'Connor MP, Minister for Immigration and Citizenship, Second Reading Speech, House of Representatives Hansard, 6 June 2013, p. 3.

8 Proposed new subsection 140GBA(4) deals with the Minister's determination by legislative instrument.

9 Proposed new subsection 140GBA(3).

10 The Hon Brendan O'Connor MP, Minister for Immigration and Citizenship, Second Reading Speech, House of Representatives Hansard, 6 June 2013, p. 3.

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1.9 The evidence of labour market testing to accompany the nomination must include one or more of the following:

• information about the approved sponsor's attempts to recruit suitably qualified and experienced Australian citizens or Australian permanent residents to the position and any other similar positions;11

• copies of, or references to, any research released in the previous six months relating to labour market trends generally and in relation to the nominated occupation;

• expressions of support from Commonwealth, State or Territory government authorities with responsibility for employment matters; or

• any other type of evidence determined by the Minister, by legislative instrument.12

1.10 The Bill contains two exemptions to the requirement for labour market testing, namely:

• a major disaster exemption (proposed new section 140GBB, item 2 of Schedule 2); and

• a skill and occupation exemption (proposed new section 140GBC, item 2 of Schedule 2).

1.11 The skill and occupation exemption provides that a sponsor is exempt from the requirement to satisfy the labour market testing condition in proposed new section 140GBA if:

• either or both of the following are required for the nominated position, in relation to the nominated occupation: a relevant bachelor degree or higher qualification, or five years or more of relevant experience; and the Minister, by way of legislative instrument, has specified that the nominated occupation is exempt (proposed new subsection 140GBC(2), item 2 of Schedule 2);13 or

• either or both of the following are required for the nominated position, in relation to the nominated occupation: a relevant associate degree, advanced diploma or diploma covered by the Australian Qualifications Framework, or three years or more of relevant experience; and the Minister, by way of

11 This information may include (but is not limited to): details of any advertising (paid or unpaid) of the position, and any similar positions, commissioned or authorised by the sponsor; information about the approved sponsor's participation in relevant job and career expositions; details of fees and other expenses paid (or payable) for any recruitment; or details of the results of such recruitment attempts, including details of any positions filled as a result (proposed new subsection 140GBA(6)).

12 Proposed new subsection 140GBA(5).

13 Proposed new subsection 140GBC(4) provides for the Minister, by way of legislative instrument, to specify an occupation for the purposes of proposed new subsections 140GBC(2) and (3).

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legislative instrument, has specified that the nominated occupation is exempt (proposed new paragraph 140GBC(3), item 2 of Schedule 2).

Conduct of the inquiry

1.12 Details of the inquiry, including links to the Bill and associated documents, were placed on the committee's website at www.aph.gov.au/senate_legalcon. The committee also wrote to over 80 organisations and individuals, inviting submissions by 20 June 2013. Submissions continued to be accepted after that date.

1.13 The committee received 24 submissions, which are listed at Appendix 1. All public submissions were published on the committee's website.

1.14 The committee held a public hearing on 21 June 2013 at Parliament House in Canberra. A list of witnesses who appeared at the hearing is at Appendix 2, and the Hansard transcript is available through the committee's website.

Acknowledgement

1.15 The committee thanks those organisations and individuals who made submissions and gave evidence at the public hearing.

Note on references

1.16 References to the committee Hansard are to the proof Hansard. Page numbers may vary between the proof and the official Hansard transcript.

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CHAPTER 2 KEY ISSUES

2.1 The key issues raised in the submissions to the inquiry can broadly be categorised as:

• whether there is a need for labour market testing for the subclass 457 visa program; and

• the impact that labour market testing would have on employers using the subclass 457 visa program to hire workers where there is a shortage of skilled Australian workers.

Need for a labour market testing condition for subclass 457 visas

2.2 There was some support expressed for labour market testing for subclass 457 visas.1 The Australian Council of Trade Unions (ACTU) argued:

Without genuine labour market testing, no proper assessment can be made as to whether there are in fact genuine skill shortages that justify the employment of overseas labour in any given case. At present, all that employers are required to do to gain access to overseas workers under the 457 program is attest to the fact that they have a strong record of, or a demonstrated commitment to, employing local labour. There is no requirement for employers to actually do anything to employ local workers before they can access the 457 visa program. This is clearly inadequate, and only serves to undermine community confidence in the program.2

2.3 In a similar vein, Dr Joo-Cheong Tham of the Melbourne Law School at the University of Melbourne contended:

If the central goal of the 457 visa scheme is to address skill shortages then it must have some regulatory mechanism to ensure that workers brought under the scheme meet actual shortages (and not simply the desires of sponsoring employers). A labour market testing requirement is a rather straightforward mechanism for this - it expressly requires sponsoring employers to demonstrate a labour shortage.3

1 Australian Council of Trade Unions (ACTU), Submission 15, p. 2; Associate Professor Joo-Cheong Tham, Submission 22, p. 14; Australian Nursing Federation, Submission 23, p. 1.

2 Submission 15, p. 2. See also, Mr Tim Shipstone, ACTU, Committee Hansard, 21 June 2013, p. 1.

3 Submission 22, p. 14.

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2.5 The Transport Workers' Union made a similar claim in relation to the need for clearer labour market testing:

We have genuine concern that currently no labour market testing is required by employers to prove they have sought to fill the position with a local residents. At present, all that employers are required to do to gain access to overseas workers under the 457 program is attest to the fact that they have a

strong record of, or a demonstrated commitment to, employing local labour.4

2.6 As did the Australian Workers' Union, arguing that:

Temporary migration visas are issued due to a scarcity of supply that is alleged by an employer. It is only logical that such a lack of supply be proved through some form of evidence with the onus of proof falling upon the applicant, which in this case is the employer.5

2.7 However, other submissions opposed the introduction of labour market testing.6 For example, the Business Council of Australia argued:

The fundamental tenets of Australia's current approach - a

government-determined list of eligible occupations coupled with a requirement to pay market salary rates - are effective in striking the right balance between filling skill shortages quickly and safeguarding job opportunities for Australian workers.7

2.8 At the public hearing, Mr Simon Pryor from the Business Council of Australia stated:

[Business Council of Australia does] not see any evidence of systemic problems nor excessive growth, the two key arguments which the government makes for bringing this scheme in. On the contrary, official data reveals a scheme moderating along with the economy. Growth in visas is only 1.7 per cent higher this year than last year, a total of 940 additional visas. Again, the few cases that do come up where there might be problems should be dealt with by enforcement and not by onerous new rules for all.8

2.9 The Australian Mines and Metals Association (AMMA) contended that employers already face a 'high regulatory bar' to accessing skilled migrants and that the additional requirement of labour market testing was unnecessary:

Before a position in a business can be filled with a temporary skilled migrant, the sponsor must certify that [the] position is suitably skilled and that the qualifications and experience of the visa holder are equivalent to

4 Transport Workers' Union, Additional Information, 21 June 2013.

5 Australian Workers' Union, Additional Information, 21 June 2013.

6 See, for example, Migration Council of Australia, Submission 4, p. 3; Master Builders Australia, Submission 7, p. 2; Australian Industry Group, Submission 12, p. 2; Migration Institute of Australia, Submission 20, p. 3; Law Council of Australia, Submission 24, p. 2.

7 Submission 14, p. 3.

8 Committee Hansard, 21 June 2013, p. 7.

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what would be required of an Australian employed in that approved occupation. Market rates and conditions that would be paid to an Australian in the same job in the same workplace must also be provided.

Sponsors incur additional costs for employing workers on 457 visas including application fees (recently [doubled] from $455 to $900), health insurance, language testing, flights to and from Australia, and agent fees for finding the worker. These additional costs make it typically $15,000 (though up to $60,000) more expensive to hire a skilled migrant than a local, in addition to the much lengthier process required. These in-built mechanisms render the onerous documentation and bureaucracy associated with [labour market testing] redundant.9

2.10 Submissions argued that the subclass 457 visa program does not provide employers with a 'low cost option' to avoid hiring Australian workers.10 For example, the Business Council of Australia argued:

It makes no sense to suggest employers would seek to use the 457 visa scheme to avoid hiring Australians because it is cheaper and faster to hire local labour when it is available. Employers already incur higher costs when employing a foreign worker compared to local workers. In making the decision that a skills shortage can only be met by hiring a 457 visa holder, business needs to factor in additional costs arising from:

- funding assistance to help with relocation and repatriation - these costs vary and are generally higher for professionals

- on-costs associated with worker top-up training, providing health insurance cover, funding and/or subsidising visa and residency applications

- program compliance costs, e.g. demonstrating payment at the market rate, demonstrating that training requirements are being met, monitoring and reporting obligations.11

2.11 However, Dr Tham questioned the extent to which the 457 visa program imposes higher costs on the engagement of 457 visa holders:

[M]any 457 visa workers are recruited on-shore so there is no relocation costs for these workers and the recruitment costs for these workers will be comparable to those incurred for local workers. [I]t also fails to adequately account for the trajectory of many 457 visa workers who go on to become permanent residents. [I]t does not acknowledge at all the cost incentive of hiring some 457 visa workers. With local workers, there is structural wage inflation with local workers tending to seek wage increases commensurate to the increase in Australian living standards; such pressure is much less

9 Submission 9, p. 7.

10 See Australian Mines and Metals Association, Submission 9, p. 7.

11 Submission 14, p. 3.

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present with many 457 visa workers especially those from countries with lower living standards.12

Government and Department responses

2.12 In his Second Reading Speech, the Minister set out the purpose of the subclass 457 visa and outlined the government's concerns that the program was not working as intended:

[The Bill] will require subclass 457 sponsors to undertake labour market testing in relation to a nominated occupation, in a manner consistent with Australia's relevant international trade obligations, to ensure that Australian citizens and permanent residents are given the first opportunity to apply for skilled vacancies in the domestic labour market.

...

The use of the subclass 457 visa program has been growing strongly in recent years. The number of primary subclass 457 visa holders in Australia has risen from 68, 400 in June 2010 to 106, 680 as at 31 May 2013, an increase of 56 per cent.

Many growing industries, including those connected with the resources boom, such as mining, as well as non-resource-sector users of the program, such as health care and information and communications technology, accounted for a large portion, over half, of all subclass 457 visa grants in 2011-12.

However, strong growth has also been recorded in industries in which employment has fallen recently, such as accommodation and food service, and retail trade.

It concerns the government that, at a time when the labour market has been flattening and some sectors and regions have experienced lay-offs and increased unemployment, the subclass 457 program has continued to grow.

Coupled with this strong growth is a tendency for some employers to source foreign labour through the subclass 457 program without regard to the Australian domestic labour force.

These trends highlight that current requirements do not commit sponsors to using the sub class 457 program as a supplement to, rather than a substitute for, the domestic labour force.

In the recently released report of the Migration Council Australia, survey data of subclass 457 employer sponsors revealed that 15 per cent of employers say that they have no difficulty finding suitable labour locally and yet they sponsor employees from overseas under this scheme.13

12 Submission 22, pp 15-16.

13 The Hon Brendan O'Connor MP, Second Reading Speech, House of Representatives Hansard, 6 June 2013, p. 1.

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2.13 In its submission, the Department of Immigration and Citizenship (Department) reiterated why labour market testing was being introduced:

Labour market testing means testing the Australian labour market to demonstrate whether a suitably qualified and experienced Australian citizen or Australian permanent resident is readily available to fill the position.

The purpose of the labour market testing element of the Bill is to ensure that the Subclass 457 visa is only used to meet genuine skill needs, and cannot be used by businesses that do not make genuine efforts to provide employment opportunities to Australian citizens and permanent residents.14

Impact of labour market testing

2.14 A number of submissions contended that the introduction of labour market testing would be contrary to the fundamental purpose of the 457 visa program, that is, to provide a fast, flexible solution to skilled labour shortages.15 AMMA described the proposed changes as 'unworkable, impractical and [likely to] lead to a blowout in processing times and costs for 457 visas'.16

2.15 The submission from the ANU College of Law, Migration Law Program argued:

[T]he provisions concerning Labour Market Testing create an added burden on genuine sponsors without improving the 457 visa process or filtering out any participants misusing the program…

[T]he introduction of Labour Market Testing condition will only add another layer of complexity, delay and administrative cost to the 457 visa scheme, without addressing the objective. These amendments are likely to deter employers from pursuing sponsorship altogether. The provisions

effectively compel employers to spend more time and money on advertising even where that advertising will be ineffective.17

2.16 However, at the public hearing, Mr Tim Shipstone of the ACTU described this type of opposition to the Bill as 'completely overblown'.18 Mr Shipstone explained:

It is not clear exactly to us what the massive burden is in expecting that employers will first have made attempts to recruit suitably qualified and experienced workers and that they provide evidence of those recruitment efforts. If an employer is genuine about sourcing local workers first, it

14 Submission 18, p. 6.

15 See, for example, Australian Chamber of Commerce and Industry, Submission 10, p. 3; Business Council of Australia, Submission 14, p. 3.

16 Submission 9, p. 5.

17 Submission 19, p. 1.

18 Committee Hansard, 21 June 2013, p. 1.

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would be reasonable to assume that those recruitment efforts were happening already, as a matter of course.19

2.17 Submissions highlighted three specific aspects of the labour market testing condition that were problematic:

• the proposed six month time frame for labour market testing;

• the type of evidence required of labour market testing; and

• the skill and occupation exemption to labour market testing.

Time frame for labour market testing

2.18 Submissions criticised the period of six months that the Minister indicated in his Second Reading Speech would be the time frame within which labour market testing is required.20 The ACTU argued that a period of six months for labour market testing is too long:

[Six months] allows for too long a period to elapse in a dynamic labour market where conditions change. For example, labour market testing done in August 2008 before the [global financial crisis] hit could not have been

considered relevant six months later in February 2009…

[T]his period should be no more than 3 months, for all [labour market testing] evidence specified. A 457 visa nomination made in December 2013 should not be able to rely on the results of job advertising conducted in June 2013, because market conditions can change too rapidly.21

2.19 The Migration Institute of Australia suggested that a period of six months for labour market testing may disadvantage both employers and visa applicants:

It is difficult to see how employers will be able to access skilled workers under the 457 programme in a timely manner, if they are required to carry out [labour market testing] over a period of six months. In many instances this may either disadvantage the employer because of the critical loss of time involved in carrying out the [labour market testing] and/or may disadvantage the visa applicant as they may lose the opportunity of being sponsored because adequate [labour market testing] had not been carried out previously by the proposed sponsor.22

Department response

2.20 In its submission, the Department confirmed that the proposed period to be specified for labour market testing is six months:

The intention of the amendment is to provide a balance between giving Australian citizens and permanent residents an opportunity to apply for jobs

19 Committee Hansard, 21 June 2013, pp 1-2.

20 See, for example, Business Council of Australia, Submission 14, p. 3; Australian Council of Trade Unions, Submission 15, p. 9.

21 Submission 15, p. 9.

22 Submission 20, p. 3.

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and ensuring that Australian businesses do not experience undue delays in filling skilled labour needs which would negatively impact on their businesses.23

Committee view

2.21 The committee is aware that there is some uncertainty about the six month time frame for labour market testing. Some of the evidence that the committee received showed that some stakeholders believed that they would have to wait six months after advertising a vacancy before they could apply to employ someone under a 457 visa. It is the committee's view that the intent of the Bill is to allow employers to apply to use a 457 visa within a six month period after advertising the initial vacancy. For example, a vacancy could be advertised in January, a recruitment process could be concluded some 4 weeks later, and then, if no suitable applicant had been found, an application could be made then to employ someone under the subclass 457 visa program.

2.22 Because of the above uncertainty, the committee urges the government to provide immediate clarification about the operation of the proposed six month time frame for labour market testing.

Evidence of labour market testing

2.23 Some submissions raised concerns in relation to some of the types of evidence that would satisfy the labour market testing conditions. For example, the ACTU argued that evidence of '[c]opies of, or references to, any research released in the previous six months relating to labour market trends generally and in relation to the nominated occupation' (proposed new paragraph 140GBA(5)(b)) was problematic:

The concern with the provision in practice…is that this could amount simply to a report commissioned by a consultant that makes a general and untested case that skill shortages exist in the relevant occupations. It falls well short of evidence that the local labour market has been actively tested.24

2.24 AMMA argued that the provision to the Department of some of the evidence of labour market testing in proposed new subsection 140GBA(6) - such as details of fees and other expenses paid in the course of recruitment - may mean that employers face the possibility of breaching commercial-in-confidence and even privacy

obligations.25

Department response

2.25 In relation to the evidence of recruitment processes in proposed new subsection 140GBA(6), the EM states:

23 Submission 18, p. 7.

24 Submission 15, p. 10.

25 Submission 9, p. 7.

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The purpose of this amendment is to provide guidance on the kinds of evidence an approved sponsor may give about the attempts of the approved sponsor to recruit suitably qualified and experienced Australian citizens or Australian permanent residents to the nominated position (and any similar positions). However, this provision is not intended to preclude the approved sponsor from providing other kinds of evidence in this regard.

It would be in the sponsor's own interest to provide authenticating detail about recruitment attempts and other relevant information with a nomination application. If insufficient detail is given, that could make the case for the nomination less persuasive.26

2.26 On the provision of evidence of recruitment processes, the Department's submission explained:

In providing details of the result of recruitment attempts, sponsors can provide reasons, if having undertaken labour market testing in relation to the nominated position, and having received an application/s from suitably qualified Australian citizens or permanent residents, why the applicants for the position were not recruited.27

2.27 At the public hearing, an officer from the Department provided the following explanation as to what would be expected in relation to the evidentiary requirements:

The way the bill is written at the moment obviously focuses primarily on what we would see as a normal recruitment method, which is that people advertise and consider whether or not the applicants are suitable for the positions. In the event that they are not, they would come to us with a nomination for a 457 worker. What the department would be seeking is the

evidence of that activity occurring, which is something we do not do at the moment. While there is an attestation saying, 'We've looked locally,' it is not enforceable. This is the mechanism that the government has chosen to make that enforceable.

The range of evidence proposed is also to recognise that we have everything from very large global companies to very small businesses seeking to use the process. Some use agents to do their recruitment for them; some recruit within their particular geographic area. The department is of the view that the measures proposed in the bill under proposed section 140GBA, subsection 5(a) to (d), give a degree of flexibility in what evidence the department would accept in considering whether a genuine attempt has been made to access Australian citizens and permanent residents from the labour market prior to looking overseas for a 457 worker.28

26 EM, p. 9.

27 Submission 18, p. 7.

28 Mr David Wilden, Department of Immigration and Citizenship, Committee Hansard, 21 June 2013, p. 33.

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Skill and occupation exemption

2.28 A number of submissions commented on the skill and occupation exemption in proposed new section 140GBC (item 2 of Schedule 2).29 For example, AMMA contended:

Section 140GBC of the bill provides for the Minister, by way of legislative instrument, to make exemptions from the [labour market testing] requirement for certain occupations within Skill Levels 1 and 2.

Managers, Professionals and certain Technicians are Skill level 1 and 2 occupations, while Trades occupations are generally Skill level 3. Given that trade and technical roles are estimated to comprise 40% of all 457 visa applications - and they remain in acute shortages - AMMA is particularly disappointed that the government has not explained why it is targeting these occupations.30

2.29 The Australian Chamber of Commerce and Industry (ACCI) expressed concern at the proposal to allow the Minister, by way of legislative instrument, to exempt occupations from the labour market testing condition, without the requirement for consultation with industry:

ACCI believes that this would create uncertainty and confusion amongst employers as the list for exempt occupations could become a fluid listing, prone to frequent change and not adequately communicated to employers.31

2.30 The ACTU argued that all occupations should be subject to labour market testing and proposed new section 140GBC should be removed from the Bill altogether. However, if the exemption was to remain, the ACTU recommended '[a]t the very least…unions and other stakeholders [should] be consulted before any decisions are made on such exemptions'.32

Department response

2.31 The EM provides the following rationale for the skill and occupation exemption:

Reforms to the Subclass 457 Visa Program are designed to address areas of greatest risk. Growth in use of the Subclass 457 Visa Program and evidence of inappropriate use is concentrated in lower skill level and lower paid occupations.

[Proposed n]ew section 140GBC recognises that most occupations classified as Skill Level 1 or Skill Level 2 in ANZSCO are generally considered to be low risk, and accordingly, allows the Minister to exempt

29 See, for example, Consult Australia, Submission 6, p. 2; Fragomen, Submission 16, p. 3.

30 Submission 9, p. 6. See also, Australian Chamber of Commerce and Industry, Submission 10, p. 3.

31 Submission 10, pp 3-4.

32 Submission 15, p. 11.

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certain approved sponsors from the requirement to undertake labour market testing on the basis of the skill level required for the nominated occupation.

The legislative instrument mechanism provides the Minister with the flexibility to specify different occupations within the 'Skill Level 1' and 'Skill Level 2' classification in ANZSCO to be exempt from labour market testing. This would allow the Minister to make a legislative instrument to exempt most, but not all, Skill Level 1 occupations and certain Skill Level 2 occupations.33

Committee view

2.32 The committee agrees with the many submissions which emphasised the important role that the subclass 457 visa program has to play in enabling employers to address skilled labour shortages where appropriately qualified Australian workers are not available.34

2.33 Given that the 457 visa program is intended as a means of complementing the local labour force, and not as a means of supplementing this workforce, it would seem a central element of the scheme that it only be used in cases where there is, in fact, a demonstrated genuine labour shortage which is unable to be filled by Australian workers. The Australian Government has identified trends in the subclass 457 visa program which call into question whether the scheme is effectively achieving this.35

2.34 While the committee acknowledges that there was significant opposition to the introduction of a labour market testing condition for the subclass 457 visa program, in the committee's view, the proposals in the Bill ensure that the subclass 457 visa program provides a balance between ensuring job opportunities for Australian workers and enabling employers to fill skilled positions.

2.35 The committee understands that many submissions to the inquiry were critical of the lack of a Regulation Impact Statement in relation to the amendments proposed in Schedule 2.36 However, the committee notes that, on the basis of exceptional circumstances, an exception has been granted to the requirement for a Regulation Impact Statement for this schedule of the Bill. Instead, a post-implementation review will be required within one to two years of the Bill's implementation.37

33 EM, pp 12-13.

34 See, for example, Australian Industry Group, Submission 12, p. 1; Migration Program, Legal Workshop Program, ANU College of Law, Submission 19, p. 1.

35 The Hon Brendan O'Connor MP, Minister for Immigration and Citizenship, Second Reading Speech, House of Representatives Hansard, 6 June 2013, p. 1. See also Department of Immigration and Citizenship, Submission 18, pp 4-5.

36 See, for example, Australian Mines and Metals Association, Submission 9, p. 3; Australian Chamber of Commerce and Industry, Submission 10, p. 2; Australian Industry Group, Submission 12, p. 2; Restaurant and Catering Industry Australia, Submission 13, p. 2; Migration Institute of Australia, Submission 20, p. 1.

37 EM, p. 2.

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2.1 The committee appreciates that some submissions expressed reservations about a number of specific provisions of the Bill. The committee believes that the post-implementation review would be the best forum in which to assess the operation

of the changes in the Bill and address any issues.

2.36 Accordingly, the committee supports the passage of the Bill.

Recommendation 1

2.37 The committee recommends that the bill be passed.

Senator Trish Crossin

Chair

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DISSENTING REPORT BY COALITION SENATORS The Migration Amendment (Temporary Sponsored Visas) Bill 2013

1.1 The Explanatory Memorandum for The Migration Amendment (Temporary Sponsored Visas) Bill 2013 (Bill) states that the Bill amends the Migration Act 1958 to enhance the Government's ability to deter sponsor behaviour which is inconsistent

with the policy intent of the Temporary Sponsored Visa Program (of which Subclass 457 visas are a part).

1.2 The key issues in relation to the Bill raised in the submissions to the Inquiry were in relation to:

(a) whether there is a need for labour market testing for the subclass 457 visa program; and

(b) the impact that labour market testing would have on employers using the subclass 457 visa program.

1.3 In drafting this report Coalition Senators have drawn on and referred to the information provided in their dissenting report to the Legal and Constitutional Affairs References Committee Inquiry into the Framework and operation of subclass 457 visas, Enterprise Migration Agreements and Regional Migration Agreements (457 Inquiry) which is being tabled in conjunction with this Report.

Overview of the 457 visa program

1.4 Coalition Senators believe that Australian workers should, as a priority, be adequately resourced to enable them to be up-skilled and empowered, to gain meaningful employment.

1.5 Australian businesses overwhelmingly prefer to hire Australian workers in preference to overseas workers on the basis that it is more economical and less complicated to fill skill requirements from the local workforce.

1.6 There is a shared consensus across business and the community that Australia's skilled and semi-skilled migration program should only be utilised to supplement our domestic workforce where necessary.

1.7 Coalition Senators do not consider that an effectively managed temporary labour migration program will threaten Australian jobs. Rather, it is an important tool to secure the future of businesses and grow employment opportunities to enable business to employ more Australians.

1.8 The Australian skilled and semi-skilled migration program should be sufficiently robust to ensure that the employment opportunities of Australians must always be protected, whilst recognising that an appropriate and sustainable human capital strategy for Australia must be readily available to safeguard business from labour and skills shortages.

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1.9 The 457 visa is the dominant component of Australia's temporary skilled migration program. It is designed to provide a prompt response to fluctuations in demand for skilled and semi-skilled workers where such demand cannot be met by the Australian workforce.

1.10 An effective policy for temporary skilled migration is vital to the efficient operation of the labour market and has the capacity to deliver significant economic benefits at a national and regional level.

1.11 Foreign workers on 457 visas account for approximately one percent of Australia's labour force,1 and account for approximately 2% of our skilled workforce.

1.12 At these low levels it is both unrealistic and naive to suggest that the 457 skilled migration program is flooding the national labour market with foreign workers.

1.13 There is significant evidence to show that 457 visa holders make a positive economic contribution to the economy through the payment of personal taxes and the spending of wages, whilst in Australia.2 It is also relevant to acknowledge that 457 visa holders are required to pay for health care insurance and are not entitled to access government welfare programs.

1.14 Australia faces an increasing labour shortage and responding to this labour challenge in a positive manner is a key productivity issue for Australia that cannot be ignored.

1.15 The ongoing demand for labour and skills and the challenges they present cannot be underestimated by Government and failure to effectively respond to identified labour shortages will negatively impact on the national economy.

1.16 The failure of the Labor Government to develop appropriate human capital strategies is all the more alarming against the background of numerous projects across the nation which could be jeopardised by labour shortages.

1 Department of Immigration and Citizenship, Subclass 457 State/Territory Report: 2012-13 to 30 April 2013, p. 1.

2 Australian Mines and Metals Association, Submission to the Senate Legal and Constitutional Affairs References Inquiry, Framework and operation of subclass 457 visas, Enterprise Migration Agreements and Regional Migration Agreements (457 Inquiry), Submission 22, p. 10.

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1.17 Included in this pipeline are projects to the value of (approximately):

• Western Australia: $293.9 Billion worth of projects;

• Queensland: $199.1 Billion worth of projects;

• New South Wales: $84.6 Billion worth of projects;

• Victoria and Tasmania: $57.6 Billion worth of projects;

• South Australia: $50.1 Billion worth of projects; and

• Northern Territory: $43.5 Billion worth of projects.

3

1.18 Currently across Australia there are approximately 259 approved projects with a value of $446.4 Billion, while a pipeline of 163 less advanced projects will potentially deliver a further $282.4 billion of investment.4

1.19 The National Resources Sector Employment Taskforce has predicted there could be a shortage of approximately 36,000 skilled tradespeople in the resources sector of by 2015. 5

1.20 Effectively addressing labour shortages through skilled and semi-skilled migration programs is not a new phenomenon in Australia.

1.21 The Howard Government's record of strong economic management was supported by sound policies designed to provide flexibility for Australia's migration intake and to serve the national interest. These policies included options to assist

business to address skills shortages.

1.22 The Howard Government oversaw an increase in the proportion of skilled migration in Australia's permanent migration program, from around 30 per cent when it assumed office in 1996 to almost 70 per cent when it left office in 2007. The introduction by the Howard Government of the 457 temporary skilled visa program ensured greater responsiveness and flexibility in responding to fluctuating labour demands.

1.23 In contrast to the Howard Government policies which successfully addressed labour shortages through skilled and semi-skilled migration programs, the current Labor Government has burdened the 457 visa program with unnecessary red tape and has effectively locked many regional areas out of the program. As a result of the mismanagement of the 457 visa program, business has been frustrated and inconvenienced in its attempts to address labour shortages.

3 Pit Crew Consulting, Labour Market Report, January 2013.

4 Pit Crew Consulting, Labour Market Report, January 2013.

5 Department of Industry, Innovation, Climate Change, Science, Research and Tertiary Education website, 'Resourcing the future: National Resources Sector Employment Taskforce report', July 2010, http://www.innovation.gov.au/Skills/National/Documents/FinalReport.pdf (accessed 17 June 2013).

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1.24 To accommodate Australia's growing requirements for skilled labour it is critical for the Government to recognise the need to implement sound policies that can assist in immediately addressing the labour shortages that business and industry are experiencing, in particular by making the present 457 visa program more efficient and user friendly, not by increasing more red tape and regulation.

1.25 The former Rudd Government and the current Gillard Government, in responding to union objections to the current 457 visa program, have diminished the effectiveness, reliability and integrity of Australia's skilled and semi-skilled migration program.

Lack of Consultation in relation to the Bill

1.26 Coalition Senators have grave concerns in relation to the lack of consultation on the impact of the Bill and the abuse and complete disregard by the Government of due process in relation to Senate Committee Inquiry process.

1.27 On 18 June 2013, the Senate referred the Bill to the Senate Legal and Constitutional Affairs Legislation Committee for inquiry and report.

1.28 Submissions to the Inquiry closed at midday on 20 June 2013.

1.29 The lack of adequate time for submitters to properly consider the bill and its potential impact and to provide considered comment was reflected in the submission to the Inquiry from Padma Raman, Executive Director of the Australian Human Rights Commission.

1.30 The submission stated:

Dear [Committee Secretary]

I refer to your invitation, by email at 7:56 pm yesterday Tuesday 18 June, for this Commission to make a submission to the Committee's Inquiry into the Migration Amendment (Temporary Sponsored Visas) Bill 2013, with submissions being requested by 12 pm tomorrow 20 June 2013.

I note that the Senate referred this matter for inquiry on 18 June and that the Committee is required to report by 25 June.

I must advise that the Commission is quite unable to make a submission on the substance of the Bill within this timeframe. I request, however, that you publish this email as the Commission's submission to the Inquiry.

The Commission wishes to state for the information of the Parliament, and for the public record, that an inquiry process which is so truncated as not to provide a realistic opportunity for public participation is not consistent with the requirements of Article 25 of the International Covenant on Civil and Political Rights. Regards Padma Raman Executive Director, Australian Human Rights Commission6

6 Submission 3, p. 1.

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1.31 The Law Council in its submission questioned why the Government was rushing the proposed changes through the Parliament without adequate consultation:

The Law Council opposes the Bill because it has been introduced hastily without adequate consultation with stakeholders and whilst the Senate's Legal and Constitutional Affairs Reference Committee is yet to deliver its findings on its May 2013 Inquiry into subclass 457 visas, Enterprise Migration Agreements and Regional Migration Agreements.

The Government appears to be rushing proposed changes through the last Parliamentary session before the September 2013 election without due consideration to the views of stakeholders.7

1.32 Coalition Senators note that the Explanatory Memorandum to the Bill states that consultation has taken place with various Commonwealth agencies including the Attorney-General's Department, the Department of Foreign Affairs and Trade, the Department of Education, Employment and Workplace Relations, the Fair Work Ombudsman, the Department of the Prime Minister and Cabinet, the Department of Treasury, the Department of Resources, Energy and Tourism, the Department of Finance and Deregulation, and the Office of Best Practice Regulation.

1.33 Coalition Senators also note however, the failure by the Government to consult with business, industry or any other private interests in relation to the impact of this Bill.

1.34 The Government's failure to properly consult is made all the more serious by the fact that the Explanatory Memorandum states that "the financial impact of these amendments is medium".

1.35 Minister O'Connor is not in an informed position to assert the impact of the financial impact of the Bill as consultation in relation to these financial impacts has not taken place.

1.36 Minister O'Connor's assertions on the financial impact of the Bill are no more than political rhetoric.

Deliberate campaign to undermine 457 visa program

1.37 Over recent months, the Government and elements within the union movement have run an aggressive media campaign claiming abuse in the 457 visa program and have resorted to making statements aimed at demonising both 457 visa holders and their employers.

1.38 Minister O'Connor claimed on 28 April 2013 that there have been in excess of 10,000 cases of abuse in the 457 program. As a result of these alleged rorts Minister O'Connor committed the Government to introduce legislation to crack down on the use of 457 visas.

7 Submission 24, p. 2.

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1.39 Coalition Senators note that Minister O'Connor's claim of 10,000 cases of abuse in the 457 program equated to approximately 9 per cent of the total number of principal visa holders in Australia at 30 April 2013 being 108,810.8

1.40 In scrutinising the obvious exaggeration and unbelievability of

Minister O'Connor's claim of 10,000 cases of abuse in the 457 program, the Coalition repeatedly called on Minister O'Connor and the Government to produce evidence to substantiate these claims.

1.41 Coalition Senators are unsurprised that Minister O'Connor has failed to produce any evidence.

1.42 In attempting to justify his exaggerated comments alleging abuse of the 457 visa program, Minister O'Connor referred in the House of Representatives, in March 2013, to a Department document which focussed on strengthening the integrity of the 457 visa program, provided to his Ministerial Advisory Council on Skilled Migration early this year.

1.43 The Coalition Shadow Minister, Mr Scott Morrison MP, subsequently obtained a copy of this document under Freedom of Information and challenged Minister O Connor on the veracity of his original allegations.

1.44 Contrary to Minister O Connor's false claims, the document did not suggest any widespread rorting or concerns with the program.9

1.45 Following the Shadow Minister's challenge to produce factual evidence that there have been in excess of 10,000 cases of abuse in the 457 program, Minister O'Connor subsequently admitted that he had made this number up and that his allegations were not based on any authoritative statistics or other probative evidence.10

1.46 Coalition Senators conclude that Minister O'Connor therefore misled the Australian people with his self-serving false comments.

1.47 Coalition Senators note that the concerted negative campaign by Minister O'Connor and a number of unions alleging abuse in the use of 457 visas was strongly criticised by industry groups, labour market experts and the Migration Council of Australia (MCA).

8 Department of Immigration and Citizenship, Subclass 457 State/Territory summary report 2012-13 to 30 April 2013, p. 2.

9 Department of Immigration and Citizenship, Ministerial Advisory Council on Skilled Migration, Discussion Paper, 'Strengthening the Integrity of the Subclass 457 Program', December 2012.

10 ABC Radio, AM, Interview with Alexandra Kirk, Friday 3 May 2013.

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1.48 In May 2013, the MCA released a landmark report on the 457 visa program, including analysis based on a survey of 3800 visa holders and 1600 businesses. It found that only two per cent of foreign workers were being underpaid.11

1.49 As stated by Ms Carla Wilshire, Chief Executive Officer, MCA:

…the findings show that the 457 visa program is critical in keeping Australia competitive in an era when industry is global and 98 per cent of innovation happens outside of Australia'.12

1.50 In its submission to the 457 Inquiry, the Australian Industry Group referred to the fact that no evidence has been presented which points to widespread or systemic abuse of the 457 visa program:

The current debate over the program has unfairly focused on the relatively few employers who do not meet their obligations. In our view, those employers should face whatever sanctions are available. However, no evidence has been presented which points to widespread or systemic abuse and we strongly object to the tone of the public debate which has had the effect of vilifying both employers and those who themselves hold 457 visas.13

1.51 The BCA submission to the 457 Inquiry noted the harm that was being done to the 457 visa program as a result of the Government's unsubstantiated claims:

The unsubstantiated claims by the government of excessive growth and widespread rorting in the temporary skilled migrant 457 visa scheme are harming our international reputation and risk undermining a program that is vital for the economy. The facts are that there are 105,000 primary 457 visa holders performing critical roles in Australia, which is less than one per cent of the workforce, and that number fell in March as visa grants declined. 14

1.52 BCA also called on the Government to provide its evidence of systemic rorting.15

1.53 The BCA also stated:

The government's changes to the 457 visa scheme announced in February were said to be in response to excessive use and so-called rorting, but with little justification presented. Individual visa holders or employers not complying with the legislation should be dealt with directly. Ad hoc

11 Migration Council of Australia, 'More than temporary: Australia's 457 visa program', additional information received 14 May 2013.

12 Migration Council of Australia website, '457 visa program is more than temporary', press release, 14 May 2013.

13 Australian Industry Group, Submission to the 457 Inquiry, Submission 16, p. 1.

14 Business Council of Australia, Submission to the 457 Inquiry, Submission 18, p. 2.

15 Business Council of Australia, Submission to the 457 Inquiry, Submission 18, p. 2.

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changes to the rules only add cost, undermine business confidence and slow business activity.16

1.54 The ACCI submission to the 457 Inquiry stated:

Given the importance of skilled migration, ACCI has become increasingly alarmed at recent policy announcements and public commentary around important elements of migration. Worthy programs such as 457 visas, EMAs and RMAs have, in recent months, become subjected to a series of unsubstantiated claims of widespread rorting and have been used to invoke parochial and even racist sentiment with claims of foreign workers 'stealing' jobs from unemployed Australians. ACCI feels that a careful, considered approach, based on clear and substantiated evidence, is needed to ensure that we maintain the value and integrity of the schemes and don't further

harm our reputation overseas as a good destination to do business, work or learn.17

1.55 The Australian Mines and Metals Association submission to the 457 Inquiry stated:

…the recent demonisation of 457 visa workers is extremely damaging. AMMA is particularly concerned at the politically charged context in which the government announced further changes to the system for 457 visas, and the lack of essential consultation with industry as a critical interest in the

effective operation of both short term and ongoing skilled labour migration.

a. The depiction of skilled migrants as foreigners that need to be 'put at the back of the queue', and that Australians are being 'discriminated against', is base rhetoric that borders dog-whistling and invites allegations of industrial xenophobia.

b. These emotive claims also ignore the reality that current rules require labour to first be sourced from the local workforce.18

1.56 The Ernst & Young submission noted:

Recent sensational media reports about the subclass 457 visa program are unhelpful to a rational public dialogue and discussion about the appropriateness of Australia's skilled migration program. The program is important to the needs of business to fill temporary vacancies with skilled foreign workers. Records published by the Department of Immigration and Citizenship indicate that there are rare and isolated instances of concern in the program. It is essential that the current sanctions regime deal with inappropriate use of the program.19

16 Business Council of Australia, Submission to the 457 Inquiry, Submission 18, p. 3.

17 Australian Chamber of Commerce and Industry, Submission to the 457 Inquiry, Submission 21, p. 4.

18 Australian Mines and Metals Association, Submission to the 457 Inquiry, Submission 22, pp 1-2.

19 Ernst & Young, Submission to the 457 Inquiry, Submission 39, p. 1.

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1.57 The Migration Institute of Australia, in its oral evidence at the 457 Inquiry, confirmed that the actual statistics did not support Minister O'Connor's false claims:

Senator CASH: Ms Chan, you would be aware that the minister, Mr O'Connor, claimed that there were at least 10,000 rorts occurring in the 457 visa system, which was then proven to be a 'guesstimate'. Mr Sheldon of the TWU this morning threw a rounder figure of 100,000 breaches of human

rights in relation to the 457 visa program. Given that you do represent almost half of the migration industry, what is your experience in relation to the allegations of rorting within the 457 visa program? And if there are rorts, are they dealt with by way of a legislative basis?

Ms Chan: We would only have the information that is provided through DIAC, and the statistics do not support either a 10,000 rort or a 100,000 rort.20

1.58 Perhaps the most damning evidence in relation to Minister O'Connor's false claims of widespread rorting was provided by his own Department at the public hearing of the 457 Inquiry.

1.59 The Department confirmed under questioning from Senator Cash that it did not provide Minister O'Connor with any advice that would form the basis of his false claims:

Dr Southern: We certainly did not provide advice around a number of 10,000.21

Claims of rorting by the CFMEU and the TWU

1.60 Evidence given by the Construction, Forestry, Energy and Mining Union (CFMEU) in its submission to the 457 Inquiry was to the effect that there were fundamental abuses or rorts of the 457 visa program:

The fundamental abuse or rort of the 457 visa program is when the Australian government authorises an employer to employ a foreign national on a 457 visa when a qualified Australian citizen or permanent resident is available and willing to do the work.22

1.61 The CFMEU submission went onto state that the union would 'provide to the Committee, on a confidential basis and upon request, numerous examples of the exploitation of 457 visa workers'.23

20 Senate Legal and Constitutional Affairs References Committee, 457 Inquiry, Committee Hansard, 23 May 2013, p. 24.

21 Senate Legal and Constitutional Affairs References Committee, 457 Inquiry, Committee Hansard, 23 May 2013, p. 67.

22 Construction, Forestry, Energy and Mining Union, Submission to the 457 Inquiry, Submission 41, p. 8.

23 Construction, Forestry, Energy and Mining Union, Submission to the 457 Inquiry, Submission 41, p. 8.

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1.62 Coalition Senators note that the evidence provided by the CFMEU on a confidential basis to the 457 Inquiry referred to 6 cases of alleged rorting. This is hardly sufficient to justify intemperate claims of fundamental rorts and abuses.

1.63 At the public hearing for the 457 Inquiry, Mr Tony Sheldon of the Transport Workers' Union of Australia (TWU) stated that he believed there were more than 100,000 people on 457 visas having their human rights exploited:

Mr Sheldon: And you would look at the question Senator Cash rightly asked, as you are asking: is there exploitation of people on 457 visas beyond those two months? When you are talking about having a human right taken from you whereby you can be deported from the country, I would argue that the entire 100,000 plus are human rights exploited…24

1.64 Coalition Senators note that the total number of principal visa holders in Australia at 30 April 2013 was estimated by DIAC to be 108,810.25

1.65 When asked by Senator Cash how many allegations of cases of exploitation or rorting had been reported to the TWU, Mr Sheldon's evidence was that there were only 24 such cases:

Senator CASH: In your oral evidence today you did use the word 'exploiting' in relation to 457 visas. How many allegations or cases of either exploitation or rorting have been reported to the TWU?

Mr Sheldon: It is 24.26

1.66 The evidence of Mr Sheldon regarding his intemperate claims of exploitation of people on 457 visas appears to be similar to the exaggerated and factually inaccurate claims made by Minister O'Connor and the CFMEU.

Office of the Prime Minister - Mr John McTernan

1.67 Coalition Senators have serious concerns with an article that appeared in the Australian newspaper on 22 June 2013 under the banner headline "PM's office breeches FoI rules for spin doctor John McTernan".

1.68 The article by the Australian's National Chief Correspondent,

Hedley Thomas, states that the Prime Minister's office is "flouting Freedom of Information rules and is refusing to hand over documents relating to the hiring of her communications director John McTernan, a Scotsman on a 457 visa for foreign workers".

1.69 The article indicates that the Office of the Information Commissioner told the Weekend Australian that it had formally rejected the Office of the Prime Minister's

24 Senate Legal and Constitutional Affairs References Committee, 457 Inquiry, Committee Hansard, 23 May 2013, p. 11.

25 Department of Immigration and Citizenship, Subclass 457 State/Territory summary report 2012-13 to 30 April 2013, p. 2.

26 Senate Legal and Constitutional Affairs References Committee, 457 Inquiry, Committee Hansard, 23 May 2013, p. 9.

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request for more time to process the documents. Ms Gillard's office has already been granted two extensions totalling 40 days.

1.70 The article reveals that the Weekend Australia in early April 2013, sought all documents relating to the hiring of Mr McTernan in 2011 as chief spin doctor for the Prime Minister. Other documents sought relate to the efforts, if any, taken to identify a suitable person in Australia for the role, such as advertising, the engagement of recruitment agencies of direct contact with media outlets and highly qualified local journalists.

1.71 Coalition Senators are of the opinion that:

(a) given the stated reasons for this Bill being to enhance the Government's ability to deter sponsor behaviour which is inconsistent with the policy intent of the Temporary Sponsored Visa Program; and

(b) the false claims by Minister O'Connor, the largely unsubstantiated claims of the CFMEU and the TWU of widespread rorting,

the Prime Minister should immediately and without further delay authorise the release of all documents relating to the appointment of her chief spin doctor,

Mr John McTernan.

1.72 Coalition Senators are of the opinion that if the Prime Minister fails to do this, coupled with her office's failure to comply with the Freedom of Information request, the conclusion that would most reasonably follow such a failure to disclose the

requested information, is that the Prime Minister is culpable in attempting to deliberately cover up, to quote Minister O'Connor, "a case of abuse" within her own office in relation to the 457 visa program.

Coalition Senators' conclusions on allegations of rorting the 457 visa program

1.73 The lack of authoritative statistical or substantive evidence provided by Minister O'Connor, the CFMEU and the TWU in their spurious claims of widespread rorting of the 457 visa program, is not consistent with the records published by the Department, which indicate that such incidents are rare and isolated within the 457 visa program.

1.74 Following the Shadow Minister's challenge to produce factual evidence that there have been in excess of 10,000 cases of abuse in the 457 program, Minister O'Connor has subsequently admitted that he had made this number up and that his allegations were not based on any authoritative statistics or other probative evidence.27

27 ABC Radio, AM, Interview with Alexandra Kirk, Friday 3 May 2013.

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1.75 Based on:

(a) the evidence of a lack of rorts in the 457 program provided to the 457 Inquiry,

(b) the fact that Minister O'Connor admitted that his claim that there has been in excess of 10,000 cases of abuse in the 457 program was false; and

(c) the fact that the CFMEU and the TWU were unable to provide authoritative statistics or substantial evidence to back up their claims of wide spread rorting,

Coalition Senators conclude that the extremely damaging statements made by Minister O'Connor, the CFMEU and the TWU, alleging widespread rorting of the 457 visa program, were politically motivated, without foundation and designed to

undermine the 457 visa program.

1.76 Coalition Senators also note that if widespread rorting was as evident as the Prime Minister and Minister O'Connor claimed, then this failing and weakness in the system has occurred on Labor's watch over the past five years.

1.77 This Government has by its own admission failed to adequately police Australia's skilled migration program.

Labor Market Testing (LMT)

1.78 The Bill introduces new LMT requirements across all skill level occupations with Minister O'Connor having the power to exempt some, but not all, higher skill level occupations.

1.79 The Bill provides that employers may be required to provide evidence that they have made attempts to fill the position locally before seeking to become a 457 visa sponsor.

1.80 Evidence to be provided would include:

• advertising of the position by the employer;

• participation in career expos;

• fees paid for recruitment; and

• results of recruitment attempts.

1.81 LMT was previously a requirement for not only subclass 457 sponsorship but also sponsorship under the Employer Nomination Scheme and Regional Sponsored Migration Scheme.

1.82 LMT was abolished in all of those areas as it was deemed to be complex, onerous and ineffective.

Evidence of an adequate inbuilt mechanism for LMT

1.83 Coalition Senators note that there is already an adequate inbuilt mechanism for LMT within the current 457 visa process.

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1.84 The adequacy of the current inbuilt mechanism for LMT was supported by the evidence of AMMA to the 457 Inquiry which set out and described the basis upon which an employer is able to access the 457 visa program:

Before a position in a business can be filled with an overseas worker, the sponsor must certify that it is suitably skilled and that the qualifications and experience of the visa holder are equivalent to what would be required of an Australian employed in that occupation. Market rates and conditions that would be paid to an Australian in the same job in the same workplace must also be provided.

Sponsors incur additional costs for employing workers on 457 visas such as paying for health insurance, flights to and from Australia, and agent fees for finding the worker. These additional costs of sponsorship can amount to $60,000 per person.

457 visas are not a low cost option to avoid the costs of employing Australian residents. It would be unsound to proceed on any other basis than that employer's hire foreign workers only as a last resort. This in-built mechanism makes it unnecessary to incorporate further labour market testing into the visa application process.

Furthermore, labour market testing - insisting that employers show evidence of having recruited locally would be debilitating for employers urgently seeking to fill a position, and who are familiar with the challenges of the local employment market. Employers seek foreign workers when they urgently need skills that are not otherwise accessible to them.

Labour market testing would also be fraught with bureaucratic and administrative problems, as DIAC case officers would also have to assess the additional information provided, thereby increasing DIAC workload and inflating processing times for 457 visas. To take this a step further and be absolutely clear, deliberately inflating process times as a disincentive to using 457 visas would be: very poor governance indeed, a rank waste of public resources; and would ill serve the interests of the Australian economy and job opportunities.28

1.85 Coalition Senators believe that the introduction of stringent LMT ignores the reality that it is in the employer's best interests, to conduct their own labour market testing and assess the availability of local skills prior to seeking to utilise the 457 visa process.

1.86 In her oral evidence to this Inquiry Ms Caroline Lambert, Director of Employment, Education and Training from ACCI stated:

…we do not believe that the government or the unions or the department are in the best position to determine how the labour market should be tested.

28 Australian Mines and Metals Association, Submission to the 457 Inquiry, Submission 22, p. 7.

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Businesses need to respond to their own circumstances in regions, in industries and across the economy, depending on their own circumstances and the urgency they may have for filling a job.

Having a departmental person or the government or anyone else say that there is only one size fits all approach to labour market testing is strongly putting barriers of regulation that the economy and these businesses do not need.

Certainly, we would urge the Senate and we would urge the parliament not to support this bill without rigorous further evidence and a regulatory impact statement.29

1.87 Coalition Senators note the evidence from various submitters to the 457 Inquiry that Australian businesses overwhelmingly prefer to hire Australians.

1.88 Consult Australia submitted that as it more economical and less complicated to fill skills requirements from the local workforce, employers unsurprisingly conduct their own LMT, in the first instance.

1.89 Consult Australia's submission to the 457 Inquiry stated that employers consistently advise that they prefer to recruit locally available staff rather than having to seek out temporary skilled migrants:

The cost of employing a temporary skilled migrant is much larger than the cost of recruiting locally, especially in terms of the cost of the process and the cost of relocating a new employee and their family to Australia. Temporary skilled migrants require more support to settle into Australian business practices, and their families require support to ensure their experience is a positive one and they do not return home early.

This demonstrates that labour market testing is a normal procedure for employers in the built environment consulting sector. Placing new requirements on employers to document and report on labour market testing is not required, and will end up as unnecessary regulation.30

1.90 Consult Australia's evidence was supported by the submission of Hamilton's Migration Law to the 457 Inquiry, which stated:

…labour market testing is already conducted by employers with a range of means…Employers are entitled to determine how best to recruit to fill a vacancy given the workforce available in their particular area. The statutory form of labour market testing has already been rejected as a feature of the 457 regime as it was seen to be incompatible with the purpose of the program which is to flexibly and quickly fill short-term vacancies.31

1.91 The evidence of the Australian Industry Group to the 457 Inquiry also supported an employer's preference to recruit locally available staff:

29 Committee Hansard, 21 June 2013, p. 10.

30 Consult Australia, Submission to the 457 Inquiry, Submission 3, p. 6.

31 Hamilton's Migration Law, Submission to the 457 Inquiry, Submission 15, pp 3-4.

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Sourcing skilled labour via 457 visas attracts a significant premium over hiring locally and this ensures that in the vast majority of cases employers will only go down the 457 path when they have exhausted local options. In

this way, employers themselves test the market thoroughly before choosing to hire through the 457 program. The visas are also available only for skills which are demonstrated to be in demand. Stringent testing will simply add more unnecessary bureaucracy...Delays caused by such testing could

prevent a business from meeting urgent commercial needs.32

Evidence against the introduction of stringent labour market testing

1.92 Coalition Senators note that the Committee majority report for this Inquiry acknowledges that there was significant opposition to the introduction of a LMT condition for the subclass 457 visa program.

1.93 Coalition Senators note that both the 457 Inquiry and this Inquiry received strong and credible evidence that the introduction of stringent LMT will reverse the balance of minimal administrative burden, which is vital to the success of the 457 visa program, and reduce the ability of an employer to access skilled labour in an efficient and economical manner.

1.94 In its submission to the 457 Inquiry, the Chamber of Commerce and Industry Queensland stated its belief that LMT is ineffective, time consuming and of little value to small and medium employers.33

1.95 The Business Council of Australia (BCA) strongly recommended against the introduction of LMT as an onerous requirement that would impose additional, unnecessary regulatory costs on industry, and would be impractical in most cases. Footnote

1.96 BCA noted that LMT introduces complex and costly process without providing any demonstrated benefits:

Businesses overwhelmingly prefer to hire Australians first. It is cheaper and faster to fill skills requirements from the permanent local workforce. Employers are taking on additional costs of hiring, training and relocating overseas when applying for 457 visas - it is in their commercial interest to have already assessed whether there might be Australian workers available to fill the roles.

There is next to nothing to be gained from mandatory labour market testing. Labour market testing would only add more cost and delay to employers and curtail business activity.

Furthermore, the introduction of labour testing could be inconsistent with Australia's commitments under World Trade Organization and free trade

32 Australian Industry Group, Submission to the 457 Inquiry, Submission 16, p. 4.

33 Chamber of Commerce and Industry Queensland, Submission to the 457 Inquiry, Submission 13, p. 7.

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agreements, as noted in the government response to the report of the Joint Standing Committee on Migration in 2009.34

1.97 The BCA in its submission to this Inquiry stated:

The most damaging initiative in the Bill is a return to labour market testing, which was abandoned following a major 2001 departmental review that found it was costly, ineffective and inferior to the system we have today

(see the report titled In Australia's Interest: A Review of the Temporary Residence Program).35

1.98 The evidence of the ANU College of Law to this Inquiry was that the introduction of stringent LMT within the application processes for the 457 visa program would be inefficient and ineffective.

We believe that the introduction of Labour Market Testing condition will only add another layer of complexity, delay and administrative cost to the 457 visa scheme, without addressing the objective. These amendments are

likely to deter employers from pursuing sponsorship altogether. 36

1.99 ACCI in its submission to the 457 Inquiry submitted that the introduction of stringent LMT requirements could cause significant time delays and would only slow down access to skilled overseas workers under what is supposed to be a fast, flexible visa solution to skilled labour shortages.37

1.100 ACCI in its submission to this Inquiry states:

…detailed labour market testing will add to cost, time and the overall red‐ tape burden incurred by businesses seeking to secure skilled labour. Of most significant concern to ACCI is the lack of a Regulatory Impact Statement examining the impact of the proposed Bill on businesses seeking to secure skilled labour.

The introduction of stringent labour market testing requirements could cause significant time delays that may see regional areas not having access to health professionals due to the time impost of conducting detailed labour

market analysis.

The Legislation acknowledges that labour market testing creates time delays. Section 140GBB of the bill includes an exemption to the Labour Market Testing requirement in the event of a natural disaster in order to assist disaster relief or recovery. In his second reading of the Bill, the Minister stated that: This exemption will give the government flexibility to respond to situations of national or state emergency and would facilitate the speedy entry of overseas skilled workers without the delay caused by requiring a sponsor to undertake labour market testing.

34 Business Council of Australia, Submission to the 457 Inquiry, Submission 18, p. 10.

35 Business Council of Australia, Submission 14, p. 3.

36 Migration Program, Legal Workshop ANU College of Law, Submission 19, p. 1.

37 Australian Chamber of Commerce and Industry, Submission to the 457 Inquiry, Submission 21, p. 10.

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This admission in the Bill that Labour Market Testing adds delays contradicts the 'timely access' policy rationale of the 457 visa program.38

Failure of government to provide a Regulation Impact Statement (RIS)

1.101 There can be no doubt that one of the most concerning aspects of this Bill is the failure by the Government to produce a RIS in relation to Schedule 2, as is required under Government policy guidelines.

1.102 The requirement for a RIS is set out on the Office of Best Practice (OBPR) website, which states:

A Regulation Impact Statement (RIS) is required, under the Australian Government's requirements, when a regulatory proposal is likely to have an impact on business or the not-for-profit sector, unless that impact is of a minor or machinery nature and does not substantially alter existing arrangements.39

1.103 The OPBR was consulted by the Government on this and advised that a RIS was required for the amendments contained in Schedule 2 to the Bill to determine the effects of the LMT provisions.

1.104 Despite this advice, DIAC sought a waiver from this requirement from the Prime Minister.

1.105 At the hearing for this Inquiry evidence was given that the following process was followed in relation to the RIS.40

1.106 On 14 May 2013, the OBPR advised the Department that in relation to Schedule 2 of the Bill, which contains the LMT provisions, a RIS was required. The Department then advised the OBPR that it would not be able to fulfil the request in the short time frame given that the Bill was to be tabled on 29 May 2013.

1.107 On 22 May 2013 Minister O'Connor wrote to the Prime Minister and asked that an exemption be given to the requirement to provide a RIS.

1.108 The Department, on notice, provided evidence that Minister O'Connor gave the following reasons for seeking an exemption from undertaking a RIS, relating to the introduction of LMT:

Given the exceptional circumstances relating to the urgency of the reforms to the Temporary Sponsored Work Visa Program; the need to realign the program to be used only where a genuine skills shortage exists; and the

38 Australian Chamber of Commerce and Industry, Submission 10, pp 2-3.

39 Department of Finance and Deregulation website, 'Australian Government RIS', http://www.finance.gov.au/obpr/ris/gov-ris.html (accessed 19 June 2013).

40 Mr David Wilden, Department of Immigration and Citizenship, Committee Hansard, 21 June 2013, p. 32.

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critical timeframe to finalise the Bill for introduction into Parliament, I am seeking your approval to exempt the LMT measure from the RIS process.41

1.109 On 27 May the Prime Minister granted that exemption.

1.110 Despite calls from stakeholders and the Coalition to publically state what the cited "exceptional circumstances" are for the granting of the exemption from the RIS, both the Minister and the Prime Minister have refused to provide an explanation.

1.111 This failure to observe administrative guidelines appears to be for crass political reasons and reflects badly on both Minister O'Connor and the Prime Minister.

1.112 Coalition Senators have significant concerns regarding the failure of the Government to provide a RIS in relation to Schedule 2 of the Bill given the cogent evidence of the likely detrimental impact these provisions will have on business.

1.113 The Government was advised of the concerns of business and industry in relation to the detrimental impacts of the Bill in the 'Open letter to members of the Federal Parliament regarding the Migration Amendment (Temporary Sponsored Visas) Bill 2013' (17 June 2013).

1.114 The letter was from the Migration Council of Australia and signed by: Innes Willox, Chief Executive Officer of the Australian Industry Group; Jennifer Westacott, Chief Executive of the Business Council of Australia; and Carla Wilshire,

Chief Executive Officer of the Migration Council Australia.

1.115 An extract from the text of the letter setting out the concerns of business and industry is as follows:

We are writing to ask for your support in opposing the Migration Amendment (Temporary Sponsored Visas) Bill 2013 in full when it is introduced into the parliament this week.

We are greatly concerned by the lack of supporting evidence, damaging rhetoric and poor process associated with the proposed changes to the 457 visa scheme, along with the considerable risks posed for investment, job creation and economic growth. Furthermore, there has been minimal consultation with industry about these changes. The legislation risks undermining the capacity to fill identified skills gaps in a timely way without a proper assessment of whether there is a genuine problem to be solved. What is so concerning is that the government is seeking to rush these changes through the final session of parliament before the election without subjecting its claims about alleged scheme abuses and inadequacies to the rigor of its own Regulatory Impact Statement (RIS) process.

The RIS exemption for the new labour market testing requirements in the Bill cites 'exceptional circumstances'. It is unclear what these circumstances are, given that the minister's department has provided no hard evidence of a systemic problem with the scheme. The government's primary argument for a systemic problem rests on a misleading interpretation of an ambiguous

41 Department of Immigration and Citizenship, answer to question on notice, received 21 June 2013.

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survey finding in a recent Migration Council Australia report. This is not an adequate foundation for introducing costly new regulation.

A Regulatory Impact Statement, with full consultation with industry, is the appropriate way to assess whether a problem exists with the 457 visa scheme and the costs and benefits of solving any purported problems through specific actions, including regulation.

Unwarranted additional regulation of the 457 visa scheme risks penalising all employers and their employees, and undermining investment, skills transfer and development and broader job creation, to address a relatively small number of instances that may be better dealt with through other means.42

1.116 The very serious concerns raised in this letter were supported by evidence from a number of other submissions to this Inquiry.

1.117 The Migration Institute of Australia in its submission to this Inquiry stated:

The MIA is concerned that there has been no proper examination of the regulatory impact the proposed changes will impose on Australian business and industry, together with impacts on labour market efficiency and business productivity from the reintroduction of labour market testing in particular.

It is in the matter of labour market testing where the greatest impact may be on Australian businesses and industry, and yet there has been no examination of that because the Prime Minister has granted an exemption.43

1.118 AMMA in its submission stated that:

…the most damaging proposal in the bill - the reintroduction of LMT - was not a recommendation made by [the Ministerial Advisory Council on Skilled Migration (MACSM)]. AMMA was particularly surprised to see LMT in the bill given concerns raised in the 2008 Deegan Review that this would compromise Australia's international trade obligations.44

1.119 AMMA also finds that LMT would be operationally debilitating for employers urgently seeking to fill skilled positions:

Such an outcome would directly detract from the policy rationale of the 457 program: providing timely access to skilled workers in occupations where identified shortages exist.45

42 A copy of this letter is available at: http://www.aigroup.com.au/portal/site/aig/template.FRAME/mediacentre/?url=http%3A%2F% 2Fwww.aigroup.com.au%2Fportal%2Fbinary%2Fcom.epicentric.contentmanagement.servlet.C ontentDeliveryServlet%2FLIVE_CONTENT%2FMedia%252520Releases%2F2013%2FJune% 2FJoint%252520457%252520letter.pdf (accessed 24 June 2013).

43 Migration Institute of Australia, Submission 20, p. 1, emphasis in original.

44 Australian Mines and Metals Association, Submission 9, p. 2, emphasis in original.

45 Australian Mines and Metals Association, Submission 9, p. 5.

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1.120 AMMA also finds that the reintroduction of LMT some 12 years after it was scrapped would a radical and regressive measure insensitive to the needs of employers and the economy and states that the LMT requirement is not only strongly opposed by industry and employers, but also the Migration Institute of Australia, the independent Migration Council of Australia and the Law Council of Australia. It was not recommended by the Government's very own Advisory Council on Skilled Migration.

1.121 In oral evidence to this Inquiry many witnesses stated that the introduction of this bill and in particular the LMT requirements would have a detrimental impact on job creation in Australia:

Mr Pryor: Yes. That is our view of the potential costs and risks of introducing this new scheme. There will be some element of a barrier being erected towards job creation in the economy. A distribution of that will depend on the different sectors and businesses themselves, but that is our

view: there is a potentially significant cost and risk to job creation in the scheme.46

Mr Melville: The most common thing I hear from companies that get involved in this area is: 'I know that I can't find these people. I know from the local community I'm working in that they're not there'. It might be a

company in a remote area of Australia or even somewhere like Ipswich. They know that there aren't people with those skills there, and saying to them that they have got to get on to a process where they advertise these positions that they know are not there and adding to their cost of employment even further is just unnecessary…

Companies have been under pressure from all sorts of things like the global financial crisis and increasing energy costs. You cannot just say that this is only a small cost. It is a small cost, but it is another small cost on top of a lot of other costs that have been going up. When you talk to our member global companies, their head offices look at Australia and ask, 'Why should

we do business there?' They look at the workplace relations laws and, although the dollar has come off, they look at the cost of the high dollar, but they also look at employment costs…47

Ms Wilshire: I think that there is both a short-run risk to job creation and a long-term risk. The short-run risk, which has been articulated by both AAG and BCA in their evidence, is that it could change the calculus of the investments by individuals. The long-term risk is that reducing the value of the program will impact on competitiveness and the six-month framework associated with the mooted labour market testing would mean we would lag behind global trends in innovation and process improvements. In a sense it would disconnect us. One of the long-term risks to job creation is that without the flow of skilled people into Australia we risk becoming a backwater in the global economy.48

46 Mr Simon Pryor, Business Council of Australia, Committee Hansard, 21 June 2013, p. 11.

47 Mr Anthony Melville, Australian Industry Group, Committee Hansard, 21 June 2013, p. 11.

48 Ms Carla Wilshire, Migration Council of Australia, Committee Hansard, 21 June 2013, p. 11.

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Ms Lambert: I certainly think that they would be deterred from using the program if you look at the proposed legislation holistically as well as, in particular, the labour market testing. Deterrence in regulation is everywhere

across the economy, and further regulation just exacerbates that frustration that business has in dealing with these issues.

I think the other important thing about the labour market testing proposed is that the flexibility and responsiveness is just eliminated from the scheme. That frustration will be enormous, and so the choices for many small businesses could be that they could close. So not only are we lacking the job creation opportunities we are actually potentially forcing some businesses to close because of their inability to use what is currently a flexible and responsive scheme because of the labour market testing— again, that one-size-fits-all approach to labour market testing.49

Mr Bolton:…having an uncertain labour supply would certainly be a very good reason for a business not to even tender for contracts. As we see, there are huge resources contracts still going ahead across the country; there have been a few that have been shelved, but there are still a lot in the pipeline. Australian businesses faced with the prospect of an uncertain labour supply, faced with the prospect of potentially waiting for six months before they can ensure that they have the people to do the job would be a very significant barrier and, indeed, a reason for them not to even tender.

On the impacts on businesses not directly related to contracting, the possibility of a hospital being without a medical registrar for six months, the possibility of a telco being without a system engineer for six months, or the possibility of a restaurant being without a chef for six months would mean that that business is not able to do its business. That would possibly send some businesses to the wall.50

Coalition Senator's conclusions

1.122 The OBPR has advised the Government that a RIS is required in relation to Schedule 2 of the Bill.

1.123 The Government failed to comply with this requirement.

1.124 The failure by the Government to provide a RIS in relation to Schedule 2 of the Bill means that the Parliament is debating this proposed legislation without information before it relating to the potential cost impact on employers and in particular the flow-on effects to jobs in Australia as a result of the LMT provisions.

1.125 Due to the very serious nature of the concerns that have been raised in relation to the Government's failure to provide a RIS and the considerable risks posed by this Bill for investment, job creation and economic growth in Australia, Coalition Senators

49 Ms Jenny Lambert, Australian Chamber of Commerce and Industry, Committee Hansard, 21 June 2013, p. 12.

50 Mr Stephen Bolton, Australian Chamber of Commerce and Industry, Committee Hansard, 21 June 2013, p. 12.

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believe that this Bill should be immediately withdrawn until a RIS with full consultation with industry has been undertaken.

Minister O'Connor's misrepresentations on what LMT is

1.126 On 21 June 2013, the same day as the Inquiry into this bill, Minister O'Connor misrepresented what LMT actually is.

1.127 Minister O'Connor in response to a question asked of him at the Skilled Migration National Employer Conference in Melbourne told attendees the LMT provisions in his Government's 457 bill amounted to:

…putting an ad in the paper. That's it. There is no other undertaking required from the employer.

1.128 Under questioning from Senator Cash at the Inquiry, the Department contradicted Minister O'Connor and confirmed that the Department is yet to determine how the LMT provisions will work. DIAC also said that Minister O'Connor's statement was not provided by the Department.

Senator CASH:...What would the department do if they asked a business for evidence of labour market testing and the business responded, as per Minister O'Connor's statement, 'I put an ad in the paper'? Is that sufficient?

Mr Wilden: The way the [labour market testing] is going to work is yet to be determined in great detail…we have not looked at the micro level…

Senator CASH:…[Y]ou do not know that yet, because as per your own evidence, you have not yet looked at the micro detail[?]

Mr Wilden: We have not looked at the micro detail…

Senator CASH:...[U]pon what basis does Minister O'Connor make that statement?

Mr Wilden: I cannot speak to why the minister would have made that statement. I was not aware of the statement and it was not prepared by this office.51

1.129 Coalition Senators are gravely concerned that Minister O'Connor has yet again deliberately manufactured false claims in relation to a bill for which he is responsible for.

1.130 Minister O'Connor has already had to admit that in relation to his claim that there have been in excess of 10,000 cases of abuse in the 457 program he had made this number up and that his allegations were not based on any authoritative statistics or other probative evidence.

1.131 Minister O'Connor has now again been caught out deliberately providing misleading information in relation to the 457 visa program.

51 Committee Hansard, 21 June 2013, p. 28, emphasis added.

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1.132 Based on:

(a) the fact that Minister O'Connor had to admit that his claim that there has been in excess of 10,000 cases of abuse in the 457 program was false; and

(b) the fact that Minister O'Connor has now been caught out again deliberately manufacturing false claims in relation to LMT;

Coalition Senators conclude that the statement made by Minister O'Connor at the Skilled Migration National Employer Conference in Melbourne were politically motivated, incorrect and designed to deliberately mislead stakeholders in relation to what LMT is.

Coalition Senators' conclusions on Labour Market Testing

1.133 Coalition Senators note that the 457 visa program is only accessible to those employers with a strong record of, or a demonstrated commitment to, employing local labour and, also, a demonstrated financial commitment to training Australian workers

1.134 Coalition Senators also note the compelling evidence from industry groups and labour market experts who have argued against the introduction of stringent LMT as part of the 457 visa application process.

1.135 Coalition Senators agree that the introduction of stringent LMT will undermine the rationale and purpose of the 457 visa program, which is intended to facilitate the rapid filling of employment positions during temporary skill shortages.

1.136 The ability to rapidly fill vacancies with a skilled overseas worker is an important feature in the overall success of the 457 visa program.

1.137 Coalition Senators believe the proposed regime for LMT will be cumbersome to implement and difficult to monitor, and will increase the burden of costs, regulation, obligations, compliance and enforcement on employers seeking to sponsor

workers on 457 visas.

1.138 Based on the evidence provided to the Inquiry, and the false statements of Minister O'Connor and the spurious evidence of the CFMEU and TWU regarding abuse of the 457 visa program, Coalition Senators have formed the view that the re-introduction of LMT is politically motivated and is being used as a vehicle to frustrate and discourage business from utilising the benefits that underpin the 457 visa regime.

1.139 Coalition Senators do not support the introduction of LMT.

Conclusions - Coalition Senators

1.140 Coalition Senators are concerned that the passage of the Bill is being progressed by the Government with indecent haste and without appropriate consultation with affected parties.

1.141 Coalition Senators believe that this Bill if passed will add significantly to the burden of costs, regulation, compliance and enforcement on employer sponsors using the 457 visa program.

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1.142 The failure by the Government to follow the advice of its own OPBR and provide a RIS in relation to the amendments contained in Schedule 2 to the Bill and the Prime Minister's actions in granting of an exemption without any explanation as to why she did this, confirms Coalition's Senators belief that this Bill is the culmination of a deliberate union and Government campaign to discredit and undermine the 457 via programme and demonise foreign workers.

1.143 Coalition Senators also conclude based on the evidence provided to the Inquiry that:

(a) the failure by the Prime Minister to comply with a FoI request in relation to her employee Mr John McTernan and

(b) the fact that the extremely damaging statements made by Minister O'Connor, the CFMEU and the TWU alleging widespread rorting of the 457 visa program are not supported by their own evidence or any other authoritative statistics or sources; and

(c) Minister O'Connor's misleading information to the Skilled Migration National Employer Conference in Melbourne in relation to what LMT is

confirms that this Bill is politically motivated and designed to undermine the 457 visa program.

1.144 This Bill is confirmation of the excessive power, control and influence that the union movement has over the Gillard Labor Government.

1.145 Coalition Senators believe that this bill based on the evidence provided to the 457 Inquiry does not represent good public policy and is not a bill that has been drafted in Australia's national interest.

1.146 Coalition Senators recommend that the Government delay the passage of this Bill 2013 to allow a RIS assessment, proper consultation with relevant parties in relation to the Bill and in particular its impact on business and industry.

1.147 The Bill is flawed and should not be proceeded with in its current form and should be withdrawn.

Senator Gary Humphries Senator Sue Boyce

Deputy Chair

Senator Michaelia Cash

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APPENDIX 1

SUBMISSIONS RECEIVED

Submission Number Submitter

1 Community Services and Health Industry Skills Council

2 Australian Motor Industry Federation

3 Australian Human Rights Commission

4 Migration Council Australia

5 Chamber of Commerce and Industry Western Australia

6 Consult Australia

7 Master Builders Australia

8 The University of Adelaide Law School

9 Australian Mines and Metals Association

10 Australian Chamber of Commerce and Industry

11 Australian Hotels Association

12 Australian Industry Group

13 Restaurant and Catering

14 Business Council of Australia

15 Australian Council of Trade Unions

16 Fragomen

17 Department of Resources, Energy and Tourism

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18 Department of Immigration and Citizenship

19 ANU College of Law, Migration Law Program

20 Migration Institute of Australia

21 Recruitment and Consulting Services Association

22 Dr Joo-Cheong Tham

23 Australian Nursing Federation

24 Law Council of Australia

ADDITIONAL INFORMATION RECEIVED

1 Additional Information provided by Business Council of Australia on 21 June 2013

2 Additional Information provided by Transport Workers' Union on 21 June 2013

3 Additional Information provided by Finance Sector Union of Australia on 21 June 2013

4 Additional Information provided by Australian Manufacturing Workers' Union on 21 June 2013

5 Additional Information provided by Maritime Union of Australia on 21 June 2013

6 Additional Information provided by Australian Workers' Union on 21 June 2013

7 Additional Information provided by Communications Electrical Plumbing Union on 21 June 2013

8 Additional Information provided by Association of Professional Engineers, Scientists and Managers Australia on 21 June 2013

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9 Additional Information provided by Construction Forestry Mining and Energy Union on 21 June 2013

10 Response to a question on notice provided by the Department of Immigration and Citizenship on 21 June 2013

11 Response to a question on notice provided by the Construction Forestry Mining and Energy Union on 21 June 2013

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APPENDIX 2

WITNESSES WHO APPEARED BEFORE THE COMMITTEE

Canberra, 21 June 2013

BOLTON, Mr Stephen, Senior Adviser, Employment, Education and Training, Australian Chamber of Commerce and Industry

CHAN, Ms Angela, National and NSW/ACT President and Chair, Skills Policy and Procedures Committee, Migration Institute of Australia

CULLY, Mr Peter, Acting Group Manager, Workplace Relations Policy Group, Department of Education, Employment and Workplace Relations

KINNAIRD, Mr Bob, Director, National Research, Construction, Forestry, Mining and Energy Union

LAMBERT, Ms Jenny, Director, Employment, Education and Training, Australian Chamber of Commerce and Industry

MADDEN, Ms Shannon, Acting Branch Manager, Migration, COAG and Evidence Branch, Social Policy and Economic Strategy Group, Department of Education, Employment and Workplace Relations

MELVILLE, Mr Anthony, Director, Public Affairs and Government Relations, Australian Industry Group

NOONAN, Mr Dave, National Secretary, Construction, Forestry, Mining and Energy Union

PARCELL, Mr Wayne, PSM, Director, Migration Institute of Australia

PRYOR, Mr Simon, Director, Policy, Business Council of Australia

RICHARDS, Mr Oliver, Assistant Secretary, Economic Policy Branch, Economics Division, Department of the Prime Minister and Cabinet

SHIPSTONE, Mr Tim, Industrial Officer, Australian Council of Trade Unions

WILDEN Mr David, Acting First Assistant Secretary, Migration and Visa Policy Division, Department of Immigration and Citizenship

WILSHIRE, Ms Carla, Chief Executive Officer, Migration Council of Australia

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The Senate

Legal and Constitutional Affairs

Legislation Committee

Migration Amendment (Unauthorised Maritime Arrivals and Other Measures) Bill 2012 [Provisions]

February 2013

321

© Commonwealth of Australia

ISBN: 978-1-74229-757-6

This document was produced by the Senate Legal and Constitutional Affairs Committee secretariat and printed by the Senate Printing Unit, Department of the Senate, Parliament House, Canberra.

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iii

MEMBERS OF THE COMMITTEE

Members

Senator Patricia Crossin, Chair, ALP, NT

Senator Gary Humphries, Deputy Chair, LP, ACT

Senator Sue Boyce, LP, QLD

Senator Mark Furner, ALP, QLD

Senator Louise Pratt, ALP, WA

Senator Penny Wright, AG, SA

Substitute member

Senator Sarah Hanson-Young, AG, SA replaced Senator Penny Wright, AG, SA for the inquiry into the Migration Amendment (Unauthorised Maritime Arrivals and Other Measures) Bill 2012

Secretariat

Ms Julie Dennett Committee Secretary

Ms Monika Sheppard Senior Research Officer

Ms Hannah Dibley Administrative Officer

Suite S1.61 Telephone: (02) 6277 3560

Parliament House Fax: (02) 6277 5794

CANBERRA ACT 2600 Email: legcon.sen@aph.gov.au

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TABLE OF CONTENTS

MEMBERS OF THE COMMITTEE ............................................................. iii 

RECOMMENDATIONS ................................................................................. vii 

CHAPTER 1 ........................................................................................................ 1 

Introduction .............................................................................................................. 1 

Referral of the inquiry ............................................................................................ 1 

Purpose of the Bill .................................................................................................. 1 

Background to the Bill ............................................................................................ 1 

Key provisions of the Bill ....................................................................................... 7 

Conduct of the inquiry .......................................................................................... 10 

Acknowledgement ................................................................................................ 10 

Note on references ................................................................................................ 10 

CHAPTER 2 ...................................................................................................... 11 

Key matters ............................................................................................................. 11 

Opposition to extension of regional processing regime ....................................... 11 

Australia's alleged breach of its international law obligations ............................. 13 

Reporting requirements ........................................................................................ 22 

Committee view .................................................................................................... 22 

DISSENTING REPORT BY THE AUSTRALIAN GREENS ..................... 25 

APPENDIX 1 ..................................................................................................... 27 

SUBMISSIONS RECEIVED ................................................................................. 27 

APPENDIX 2 ..................................................................................................... 29 

WITNESSES WHO APPEARED BEFORE THE COMMITTEE ................... 29 

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RECOMMENDATIONS

Recommendation 1

2.42 The committee recommends that the Bill be amended to require the Minister for Immigration and Citizenship to report annually to both Houses of Parliament in respect of the following matters:

 arrangements during each 12 month period for unauthorised maritime arrivals seeking asylum, including arrangements for:

 assessing any claims for refugee st atus made by such unauthorised maritime arrivals;

 the accommodation, health care and education of such unauthorised maritime arrivals;

 the number of asylum claims by unauthorised maritime arrivals that are assessed during each 12 month period; and

 the number of unauthorised maritime arrivals determined during each 12 month period to be refugees.

Recommendation 2

2.43 Subject to recommendation 1, the committee recommends that the Senate pass the Bill.

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CHAPTER 1 Introduction

Referral of the inquiry

1.1 On 31 October 2012, the Migration Amendment (Unauthorised Maritime Arrivals and Other Measures) Bill 2012 (Bill) was introduced into the House of Representatives by the then Minister for Immigration and Citizenship (Minister), the Hon Chris Bowen MP.1 On 1 November 2012, the Senate referred the provisions of the Bill to the Senate Legal and Constitutional Affairs Legislation Committee

(committee) for inquiry and report by 5 February 2013.2 This date was subsequently extended to 25 February 2013.3

Purpose of the Bill

1.2 The Bill seeks primarily to amend the Migration Act 1958 (Cth)

(Migration Act), to implement Recommendation 14 of the Report of the Expert Panel on Asylum Seekers (Expert Panel's Report):

The Panel recommends that the [Migration Act] be amended so that arrival anywhere on Australia by irregular maritime means will not provide individuals with a different lawful status than those who arrive in an excised offshore place.4

Background to the Bill

1.3 On 27 September 2001, section 198A was inserted into the Migration Act.5 This provision allowed for offshore entry persons to be removed from Australia to a country in respect of which a declaration under subsection 198A(3) was in force (the offshore processing regime).6

1 House of Representatives, Votes and Proceedings, No. 141-31 October 2012, p. 1932.

2 Senate, Journals of the Senate, No. 121-1 November 2012, pp 3237-3238.

3 Senate, Journals of the Senate, No. 123-20 November 2012, pp 3324-3325.

4 Air Chief Marshal Angus Houston AC, AFC (Ret'd), Mr Paris Aristotle AM, Professor Michael L'Estrange AO, Report of the Expert Panel on Asylum Seekers (Expert Panel's Report), August 2012, p. 17 (Recommendation 14), available at: http://expertpanelonasylumseekers.dpmc.gov.au/report (accessed 22 February 2013). Also see Explanatory Memorandum (EM), p. 1.

5 Section 6 of the Migration Amendment (Excision from Migration Zone) (Consequential Provisions) Act 2001 (Cth).

6 'Offshore entry person' is defined in subsection 5(1) of the Migration Act 1958 (Cth) (Migration Act).

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Judicial review of section 198A of the Migration Act

1.4 In August 2011, the High Court of Australia (High Court) reviewed section 198A of the Migration Act in the case of Plaintiff M70/2011 v Minister for Immigration and Citizenship; Plaintiff M106 of 2011 v Minister for Immigration and Citizenship.7

1.5 The case related to two matters, known as M70/2011 and M106 of 2011, involving a 24-year-old male citizen of Afghanistan (Plaintiff M70/2011) and a 16-year-old unaccompanied male citizen of Afghanistan (Plaintiff M106 of 2011). Both plaintiffs arrived at Christmas Island (an excised offshore place) in August 2011 as part of a larger group of asylum seekers, and were identified as liable to transfer to Malaysia pursuant to a declaration made on 25 July 2011 under subsection 198A(3) of the Migration Act (Malaysia declaration).8

1.6 The plaintiffs commenced proceedings in the High Court seeking orders, which included a declaration of invalidity in respect of the Malaysia declaration, and an order in the nature of prohibition to restrain the Minister and the Commonwealth from taking any steps to remove them from Australia.

1.7 The main issues considered by the High Court were whether the Malaysia declaration had been validly made, and whether the Minister had satisfied the requirements of the Immigration (Guardianship of Children) Act 1946 (Cth) (Guardianship Act) in relation to Plaintiff M106 of 2011.

1.8 In holding for the plaintiffs, a majority of the court (French CJ, Gummow, Hayne, Kiefel, Crennan and Bell JJ; Heydon J dissenting) found that the Minister's declaration of Malaysia as a declared country under subsection 198(3) was beyond power and therefore invalid.9

7 [2011] HCA 32.

8 'Instrument of Declaration of Malaysia as a Declared Country under Subsection 198A(3) of the Migration Act 1958', registered 18 August 2011, available at: http://www.comlaw.gov.au/Details/F2011L01685 (accessed 22 February 2013).

The bilateral agreement relating to the transfer of asylum seekers from Australia to Malaysia, the Arrangement between the Government of Australia and the Government of Malaysia on transfer and resettlement (Malaysia Arrangement), is available at: http://www.minister.immi.gov.au/media/media-releases/_pdf/20110725-arrangement-malaysia-

aust.pdf (accessed 22 February 2013).

The Malaysia Arrangement was examined by the Legal and Constitutional Affairs References Committee in October 2011 and is available at: http://www.aph.gov.au/Parliamentary_Business/Committees/Senate_Committees?url=legcon_c tte/completed_inquiries/2010-13/malaysia_agreement/report/index.htm (accessed 22 February 2013).

9 Plaintiff M70/2011 v Minister for Immigration and Citizenship; Plaintiff M106 of 2011 v Minister for Immigration and Citizenship [2011] HCA 32 per Gummow, Hayne, Crennan and Bell JJ at 136.

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1.9 The reason for the decision was articulated in the joint majority judgement: the jurisdictional matters set out in paragraph 198A(3)(a) were not, and could not be, established.10 These matters required a country the subject of a declaration to:

 provide asylum seekers with access to effective procedures for assessing their need for protection;

 provide asylum seekers with protection, pending determination of their refugee status;

 provide refugees with protection, pending voluntary repatriation to their country of origin or resettlement in another country; and

 meet relevant human rights standards in providing that protection.

Migration Legislation Amendment (Offshore Processing and Other Measures) Bill 2011

1.10 The Prime Minister, the Hon Julia Gillard MP described the High Court's decision as 'deeply disappointing'11 and, in response, the Migration Legislation Amendment (Offshore Processing and Other Measures) Bill 2011 (Regional Processing Bill) was introduced into the House of Representatives by the then Minister on 21 September 2011.12

1.11 The Regional Processing Bill sought to amend the Migration Act and the Guardianship Act to:

 replace the existing offshore processing regime; and

 clarify that provisions of the Guardianship Act do not affect the operation of the Migration Act, particularly in relation to the making and implementation of any decision to remove, deport or take a non-citizen child from Australia.13

1.12 The Minister stated:

The purpose of this bill is clear: to restore to the executive the power to set Australia's border protection policies, specifically the power to transfer asylum seekers arriving at excised offshore places to a range of designated

10 Plaintiff M70/2011 v Minister for Immigration and Citizenship; Plaintiff M106 of 2011 v Minister for Immigration and Citizenship [2011] HCA 32 per Gummow, Hayne, Crennan and Bell JJ at 135.

11 The Hon Julia Gillard MP, Prime Minister (Prime Minister) and the Hon Chris Bowen MP, Minister for Immigration and Citizenship (Minister), 'Transcript of joint press conference, Brisbane', 1 September 2011, available at: http://www.pm.gov.au/press-office/transcript-joint-press-conference-brisbane-1 (accessed 22 February 2013).

12 House of Representatives, Votes and Proceedings, No. 70-21 September 2011, p. 941. The name of the bill, and all other references to the word 'offshore', was subsequently amended to reflect use of the word 'regional' throughout the proposed legislation.

13 Migration Legislation Amendment (Offshore Processing and Other Measures) Bill 2011, EM, p. 1, available at: http://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result? bId=r4683 (accessed 22 February 2013).

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third countries within the region, while ensuring protection from refoulement, for the processing of their claims.

This is a power that was thought to exist until 31 August this year, when the majority of the High Court decided that transfers under section 198A of the Migration Act could only take place to countries legally bound to provide protections equivalent to those offered by Australia.

Subsequent legal advice has made it clear that the High Court's decision has thrown into significant doubt the ability of governments—present or future—to effect transfers to a range of countries in our region who are prepared to offer protection from refoulement, and will allow processing of refugee claims to be made, including Papua New Guinea and Nauru.14

1.13 Debate on the Regional Processing Bill commenced in the House of Representatives on 22 September 2011, at which time the Federal Opposition indicated that it would not be supporting the bill unless it were amended to require regional processing to take place in countries which are signatories to the 1951 Convention Relating to the Status of Refugees,15 as amended by the 1967 Protocol Relating to the Status of Refugees16 (collectively, the Refugee Convention).17

1.14 The Australian Government did not seek to amend the Regional Processing Bill and debate on the bill was adjourned until August 2012.

Migration Legislation Amendment (The Bali Process) Bill 2012

1.15 Mr Robert Oakeshott MP sought to resolve the political deadlock with the introduction in February 2012 of a private member's bill, the Migration Legislation Amendment (The Bali Process) Bill 2012 (Bali Process Bill).18

1.16 The provisions of the Bali Process Bill were similar to those of the Regional Processing Bill; however, there was a key difference in the proposed provision concerning the designation of a country for regional processing purposes (proposed subsection 198AB(2)). Whereas both bills provided for the Minister to make such a

14 House of Representatives Hansard, 21 September 2011, p. 10946 (italicisation added). 'Refoulement' is an international legal term meaning the return by a state, in any manner whatsoever, of an individual to the territory of another state, in which: the individual's life or liberty would be threatened; the individual would be persecuted for reasons of race, religion, nationality, membership of a particular social group or political opinion; or the individual would run the risk of torture.

15 Opened for signature 28 July 1951, [1954] ATS 5 (entered into force for Australia on 22 April 1954).

16 Opened for signature on 31 January 1967, [1973] ATS 37 (entered into force for Australia on 13 December 1973).

17 The 1951 Convention Relating to the Status of Refugees and 1967 Protocol Relating to the Status of Refugees (collectively, the Refugee Convention) are available at: http://www.unhcr.org/pages/49da0e466.html (accessed 22 February 2013). The international law obligation prohibiting refoulement by a state is contained in article 33(1) of the Refugee Convention.

18 House of Representatives, Votes and Proceedings, No. 87-13 February 2012, p. 1203.

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designation in the national interest, the Bali Process Bill added the further condition that the country concerned must be a party to the 'Bali Process', a process established at the Regional Ministerial Conference on People Smuggling, Trafficking in Persons and Related Transnational Crime held in Bali in February 2002.19

1.17 On 31 May 2012, the second reading debate for the Bali Process Bill began in the House of Representatives. During debate the Leader of the Opposition, the Hon Tony Abbott MP reiterated the Federal Opposition's objection to proposed legislation which 'strips' protections from asylum seekers in regional processing countries.20 The Shadow Minister for Immigration and Citizenship,

Mr Scott Morrison MP explained further the reasons why the Bali Process Bill did not address the concerns of the Federal Opposition:

The only objective, legally binding protection that can be used as a litmus test for this parliament to give instructions to the executive as to which countries and which places they could send people is whether a country is a signatory to the [R]efugee [C]onvention. There are 148 countries who have signed that convention. That includes the Philippines, that includes Nauru, that includes Papua New Guinea, and that includes many other countries.

These protections are important. You have to ask yourself the question: why is it necessary to abolish the protections that exist in the Migration Act…The Bali process…is a worthy process and one we initiated in government but it does not provide legally binding international obligations on its participants.21

1.18 Mr Morrison moved amendments to require a country designated for regional processing purposes to be a party to the Refugee Convention.22 The proposed amendments were negatived in the House of Representatives,23 and the Bali Process Bill was passed in that house on 27 June 2012.24

1.19 On 28 June 2012, the Bali Process Bill was introduced into the Senate, where it was defeated.25 Subsequently, the Prime Minister and the then Minister held a joint press conference, where it was announced that the Australian Government had invited Air Chief Marshal Angus Houston AC AFC (Ret'd), the former chief of Australia's

19 The Bali Process is a voluntary regional forum, which brings together participants to work on practical measures to help combat people smuggling, trafficking in persons and related transnational crime in the Asia-Pacific region: see http://www.baliprocess.net/ (accessed 22 February 2013).

20 House of Representatives Hansard, 27 June 2012, p. 8222.

21 House of Representatives Hansard, 27 June 2012, p. 8225.

22 House of Representatives Hansard, 27 June 2012, p. 8226.

23 House of Representatives, Votes and Proceedings, No. 119-27 June 2012, pp 1641-1643.

24 House of Representatives, Votes and Proceedings, No. 119-27 June 2012, pp 1642-1643.

25 Senate, Journals of the Senate, No. 99-28 June 2012, p. 2678.

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defence force, to lead an expert panel to provide a report on the best way forward in dealing with asylum seeker issues.26

Expert panel on asylum seekers

1.20 On 13 August 2012, following a six week inquiry, the expert panel reported to the Prime Minister and the then Minister.27 The expert panel indicated that, in formulating a solution to the political impasse, its focus had been to find practical ways to progress effective regional cooperation on asylum seeker issues:

[T]he only viable way forward is one that shifts the balance of risk and incentive in favour of regular migration pathways and established international protections and against high-risk maritime migration.28

1.21 The expert panel made 22 recommendations proposing an integrated regional approach to policy on asylum seeker and refugee issues, including that 'legislation to support the transfer of people to regional processing arrangements be introduced into the Australian Parliament as a matter of urgency'.29

1.22 On 14 August 2012, debate resumed on the Regional Processing Bill, with the Minister foreshadowing government amendments, as agreed with the Federal Opposition, to ensure that the parliament must approve the designation of each regional processing country under section 198AB of the Migration Act.30 On 15 August 2012, the bill was passed in the House of Representatives31 and in the Senate on 16 August 2012.32 The bill received Royal Assent on 17 August 2012 and commenced the following day.

Loss of life at sea

1.23 In its report, the expert panel referred to the loss of life at sea by asylum seekers and refugees undertaking irregular maritime journeys to Australia:

The loss of life on dangerous maritime voyages in search of Australia's protection has been increasing. The number of irregular maritime arrivals

26 Transcript of joint press conference, Canberra, 28 June 2012, available at: http://www.pm.gov.au/press-office/transcript-joint-press-conference-canberra-29 (accessed 22 February 2013).

27 EM, p. 1. The Expert Panel's Report is available at: http://expertpanelonasylumseekers.dpmc.gov.au/report (accessed 22 February 2013).

28 Expert Panel's Report, August 2012, p. 8.

29 Expert Panel's Report, August 2012, p. 15 (Recommendation 7).

30 Migration Legislation Amendment (Offshore Processing and Other Measures) Bill 2011, Government Amendments, BP256, available at: http://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result? bId=r4683 (accessed 22 February 2013); the Hon Mr Chris Bowen MP, Minister for Immigration and Citizenship, House of Representatives Hansard, 14 August 2012, pp 8510-8511 and 8517.

31 House of Representatives, Votes and Proceedings, No. 122-15 August 2012, pp 1681-1682.

32 Senate, Journals of the Senate, No. 102-16 August 2012, p. 2791.

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…who have arrived in Australia in the first seven months of 2012 (7,120) has exceeded the number who arrived in total in 2011 (4,733) and 2010 (6,850). The likelihood that more people will lose their lives is high and unacceptable. These realities have changed the circumstances that Australia now faces. They are why new, comprehensive and integrated strategies for responding are needed. Those strategies need to shift the balance of Australian policies and regional arrangements to give greater hope and confidence to asylum seekers that regional arrangements will work more effectively, and to discourage more actively the use of irregular maritime voyages.33

1.24 As stated by the then Minister in his second reading speech for the current Bill:

[T]he recommendations in the report are an integrated set of proposals. To be effective in discouraging asylum seekers from risking their lives, the incentives and disincentives the panel recommended must be pursued in a comprehensive manner. The legislative amendments proposed in the [B]ill are part of this integrated approach.34

Key provisions of the Bill

1.25 The Migration Legislation Amendment (Regional Processing and Other Measures) Act 2012 (Cth) repealed section 198A of the Migration Act, and replaced that provision with Subdivision B of Division 8 of Part 2 of the Act (the regional processing framework).35

1.26 The regional processing framework provides for offshore entry persons to be taken to another country for assessment of their refugee status under the Refugee Convention. The Bill proposes to amend several of these provisions: the key amendments are contained in Part 1 of Schedule 1 of the Bill and are summarised below.

Unauthorised maritime arrivals

1.27 The defined term 'offshore entry persons' will be repealed (item 3 of Schedule 1), and will be replaced by the new term 'unauthorised maritime arrival' in proposed new section 5AA of the Migration Act (item 8 of Schedule 1). A person will be an unauthorised maritime arrival if:

(a) the person entered Australia by sea:

(i) at an excised offshore place at any time after the excision time for that place; or

(ii) at any other place at any time on or after the commencement of this section; and

33 Expert Panel's Report, August 2012, p. 7.

34 House of Representatives Hansard, 31 October 2012, pp 12738-12739.

35 Section 25 of the Migration Legislation Amendment (Regional Processing and Other Measures) Act 2012 (Cth).

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(b) the person became an unlawful non-citizen because of that entry; and

(c) the person is not an excluded maritime arrival.36

Visa applications and unauthorised maritime arrivals

1.28 Section 46A of the Migration Act sets out provisions regarding visa applications by offshore entry persons. Items 10 to 14 of Schedule 1 will amend that provision, to reflect the use of the new term 'unauthorised maritime arrival'. The effect of this amendment will be that persons who are unauthorised maritime arrivals will not be able to make a valid visa application, if they are in Australia and they are unlawful non-citizens, unless the Minister exercises a personal discretion under subsection 46A(2) of the Act.

Detention of unlawful non-citizens

1.29 Section 189 of the Migration Act provides for the detention of unlawful non-citizens. An unauthorised maritime arrival will become an unlawful non-citizen if the person entered Australia by sea - as set out in proposed new paragraph 5AA(1)(a)

- and is not an excluded maritime arrival. Item 15 of Schedule 1 will amend subsection 189(2) to replace the words 'must detain' with the words 'may detain'. The effect of this amendment will be that an officer will have discretion whether to detain

certain persons seeking to enter the migration zone (other than an excised offshore place) if they would, in the migration zone, be unlawful non-citizens.

Unauthorised maritime arrivals and transfer to a regional processing country

1.30 Section 198AD of the Migration Act sets out provisions in relation to taking offshore entry persons to a regional processing country. Items 19 to 30 of Schedule 1 amend this provision, to reflect the use of the new term 'unauthorised maritime arrival'. The effect of these amendments will be that persons who are unauthorised maritime arrivals, and who are detained under section 189, must be removed from Australia to a regional processing country as soon as reasonably practicable.37

Bar on certain legal proceedings

1.31 Items 51 to 58 of Schedule 1 make a number of 'consequential' amendments to section 494AA of the Migration Act, which provides for a bar on certain legal proceedings relating to offshore entry persons. The effect of the proposed amendments is to prevent the institution or continuation of certain legal proceedings against the Commonwealth by unauthorised maritime arrivals. For example, proceedings relating to an unauthorised entry (item 52 of Schedule 1).

36 Proposed new subsection 5AA(1) of the Migration Act 1958 (Cth) (Migration Act); item 8 of Schedule 1 of the Bill.

37 Subsections 198(1) and 198(2) of the Migration Act.

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Reporting obligations

1.32 Item 47A of Schedule 1 of the Bill inserts proposed new section 198AI into the Migration Act, to require the Minister to report annually to each House of Parliament in respect of certain matters - such as the activities conducted under the Bali Process during the year ending on 30 June.

Transitory persons

1.33 The defined term 'transitory person' will be amended (items 4 to 6 of Schedule 1), with the effect that a person will continue to be a transitory person if they have been assessed as a 'refugee' under article 1A of the Refugee Convention.

Transitory persons and transfer to a regional processing country

1.34 Section 198AH of the Migration Act provides for the application of section 198AD to certain transitory persons. Items 43 to 46 of Schedule 1 amend section 198AH, to allow transitory persons to be removed from Australia to a regional processing country, as soon as practicable, if the person is an unauthorised maritime arrival detained under section 189, who was brought to Australia from a regional processing country for a temporary purpose, and who no longer needs to be in Australia for that purpose.

1.35 The Minister explained:

This amendment will allow the government to bring people assessed as refugees—but who have not yet met the 'no advantage' principle—back to Australia for a temporary purpose such as medical treatment, and then return them to a designated regional processing country pending provision of a durable outcome.38

1.36 The 'no advantage' principle was articulated in Recommendation 1 of the Expert Panel's Report as one of six principles which the expert panel considered should shape Australian policy-making on asylum seeker issues:

The application of a 'no advantage' principle to ensure that no benefit is gained through circumventing regular migration arrangements.39

Assessment of refugee status

1.37 Section 198C of the Migration Act sets out provisions regarding the entitlement of certain transitory persons to an assessment of refugee status. Item 48 of Schedule 1 repeals this provision, to remove the entitlement of a transitory person brought to Australia under section 198B of the Act to request an assessment of refugee status if the person remains in Australia for a continuous period of six months. According to the Explanatory Memorandum to the Bill, the proposed amendment is consistent with the 'no advantage' principle.40

38 House of Representatives Hansard, 31 October 2012, p. 12739.

39 Expert Panel's Report, August 2012, p. 14 (Recommendation 1).

40 EM, p. 18.

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Application and savings provisions

1.38 Part 2 of Schedule 1 of the Bill contains application and savings provisions. For example, the regional processing provisions contained in Subdivision B of Division 8 of Part 2 of the Migration Act, as amended by the Bill, will apply to all persons who entered Australia by sea on or after 13 August 2012 (item 60 of Schedule 1).

Conduct of the inquiry

1.39 The committee advertised the inquiry in The Australian on 7 November 2012. Details of the inquiry, including links to the Bill and associated documents, were placed on the committee's website at www.aph.gov.au/senate_legalcon.

The committee also wrote to 135 organisations and individuals, inviting submissions by 17 December 2012. Submissions continued to be accepted after that date.

1.40 The committee received 36 submissions, which are listed at Appendix 1. All submissions were published on the committee's website.

1.41 The committee held a public hearing on 31 January 2013 at Parliament House in Canberra. A list of witnesses who appeared at the hearing is at Appendix 2, and the Hansard transcript is available through the committee's website.

Acknowledgement

1.42 The committee thanks those organisations and individuals who made submissions and gave evidence at the public hearing.

Note on references

1.43 References to the committee Hansard are to the proof Hansard. Page numbers may vary between the proof and the official Hansard transcript.

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CHAPTER 2 Key matters

2.1 Submitters and witnesses raised various matters in relation to the Bill. In particular, stakeholders opposed the extension of the regional processing regime from offshore entry persons to unauthorised maritime arrivals on the mainland, and argued that Australia is in breach of its international law obligations, including by transferring responsibility for unauthorised maritime arrivals to regional processing countries. A few witnesses also commented on the omission of reporting obligations in the Bill.

Opposition to extension of regional processing regime

2.2 While a number of submitters and witnesses were expressly supportive of measures aimed at preventing the further loss of life at sea as the result of dangerous maritime journeys, they opposed extending the policy of transferring asylum seekers

to third countries for the processing of protection claims.1 The reasons for this opposition varied.

Flawed policy basis

2.3 In evidence, Professor Penelope Mathew stated that the policy justification for the Bill is flawed:

[T]he one justification that has been advanced is that we have to stop deaths at sea. Unfortunately, I do not think the bill will do that, even on its own logic. I think that pretending Australia does not exist—excising ourselves from our own migration zone—may, in fact, result in even longer journeys…[T]here was a report about some Sri Lankans who were saying that they would go even further to seek asylum.2

2.4 Mr Sean Bain submitted that the Explanatory Memorandum presents the Bill as a reasonable measure designed to rectify inconsistencies with the application of the Migration Act. However, he highlighted the inconsistency between the legal status conferred on irregular maritime arrivals arriving by boat at excised offshore places, and the legal status of those persons arriving by boat at any other place:

The remedy proposed in the Bill is to extend discriminatory measures active in excised offshore places to the Australian mainland. The [g]overnment is using a questionable and problematic legal anomaly as the

1 For example, Conference of Leaders of Religious Institutes in New South Wales, Submission 4, p. 2; Castan Centre for Human Rights Law, Submission 17, p. 2; Australian Human Rights Commission, Submission 20, p. 7; Office of the Commissioner for Equal Opportunity (SA), Submission 21, p. 1; Federation of Ethnic Communities' Councils of Australia, Submission 23, p. 2; Refugee Council of Australia, Submission 26, p. 1; Migration Institute of Australia, Submission 32, p. 3; Mr Richard Towle, United Nations High Commissioner for Refugees (UNHCR), Committee Hansard, 31 January 2013, p. 1.

2 Committee Hansard, 31 January 2013, p. 20.

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basis for policy making for the Australian mainland. This is policy on-the-run rather than a measured response to a complex issue.3

'Push' and 'pull' factors

2.5 Other evidence argued that the policy of regional processing does not deter asylum seekers from undertaking maritime journeys to Australia,4 with some submitters focussing on the 'push' and 'pull' factors involved in refugee migration.

2.6 As Dr Gabrielle Appleby, Associate Professor Alexander Reilly and Dr Matthew Stubbs from Adelaide Law School explained:

[G]iven the severity of the 'push' factors facing asylum seekers who cannot seek protection in their home states, there is a serious doubt as to whether the incapacity to apply for a protection visa and immediate removal from Australia to a third country will deter people from attempting to reach Australia by boat.5

2.7 Mr Bain submitted that the key factors in a person's decision to travel onward to Australia are the absence of satisfactory protection arrangements in transit states, and deficiencies of regular pathways for resettlement in a third country:

Most asylum seekers travelling by boat to Australia depart from Indonesia…Asylum seekers in Indonesia have little hope of obtaining resettlement through formal mechanisms. This serves as a push factor influencing the decisions of asylum seekers to undertake the boat journey to Australia…[T]here are proactive measures the Government could pursue to buffer against push factors and reduce the number of asylum seekers [undertaking] dangerous boat journeys to Australia from Indonesia.6

2.8 Professor Ben Saul from the University of Sydney similarly focussed on the position of asylum seekers and refugees arriving in Indonesia:

[O]ne key reason why asylum seekers and refugees departed or intended to depart Indonesia by boat to Australia was precisely because [United Nations High Commissioner for Refugees (UNHCR)] processing times and resettlement processes were too long and too uncertain. Upon arrival in Indonesia, a person registering with UNHCR will typically wait between [six] and [nine] months just to be interviewed, followed by a further [six] months to a year awaiting a decision, followed by an unspecified period of time waiting for resettlement - which also might never happen.

3 Submission 22, p. 9.

4 For example, NSW Council for Civil Liberties, Submission 3, p. 4; Castlemaine Rural Australians for Refugees, Submission 8, p. 1; Federation of Ethnic Communities' Councils of Australia, Submission 23, p. 3; ACT Refugee Action Committee, Submission 30, pp 4-6; Ms Tania Penovic, Castan Centre for Human Rights, Committee Hansard, 31 January 2013, pp 10 and 13; Professor Penelope Mathew, Committee Hansard, 31 January 2013, p. 20.

5 Submission 2, p. 4. For similar comments regarding the strength of 'push' factors, see Ms Yanya Viskovich, Submission 29, p. 3.

6 Submission 22, pp 3-4.

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One of the most immediate ways Australia could save lives at sea, therefore, is to provide support (through more funding and staffing) to UNHCR to rapidly improve the speed of refugee status determination, as well [as] by increasing the number of resettlement places from Indonesia and the speed with which resettlement happens.7

Need for regional approach

2.9 At the public hearing, the United Nations High Commissioner for Refugees' (UNHCR) representative, Mr Richard Towle, emphasised the need for a regional approach to asylum seeker and refugee issues:

[T]he best way to deal with th[e]se issues is to improve the quality of refugee protection and security for asylum seekers in other parts of the region, to provide them with a real option other than to take these dangerous and difficult journeys to Australia…[T]he proper and the most sensible investment is in South-East Asia. The key lies in South-East Asia, where people are coming from, buttressed by robust, fair asylum procedures in Australia…Unilateral approaches that divert refugee populations on to other countries, particularly poor and under-resourced Pacific island states, do not really deal with the root causes of the problem[.]8

Australia's alleged breach of its international law obligations

2.10 Many submitters and witnesses identified a wide range of international law obligations, which are relevant to the measures proposed in the Bill. For example:

 article 26 of the Vienna Convention on the Law of Treaties, which states that parties must perform their treaty obligations in good faith;9

 article 14(1) of the Universal Declaration of Human Rights, which provides that everyone has the right to seek and enjoy in other countries asylum from persecution;10

7 Submission 1, p. 2. Also see Refugee Action Coalition, which commented on 'properly resourced arrangements for the timely processing of asylum seekers in Indonesia', and resettlement in Australia of recognised refugees: Submission 35, p. 4.

8 Committee Hansard, 31 January 2013, pp 1 and 5-6. For similar views on the need for a regional approach, see, for example, Mr Sean Bain, Submission 22, pp 5-6; ACT Refugee Action Committee, Submission 30, p. 3; Ms Tania Penovic, Castan Centre for Human Rights, Committee Hansard, 31 January 2013, pp 12-13; Mr Paul Power, Refugee Council of Australia, Committee Hansard, 31 January 2013, p. 14.

9 For example, Australian Lawyers for Human Rights, Submission 7, p. 5; Professor Jane McAdam, Submission 11, pp 4-6; Liberty Victoria, Submission 25, p. 2; Ms Tania Penovic, Castan Centre for Human Rights, Committee Hansard, 31 January 2013, p. 9. These submissions argued that the Bill proposes to block access to Australia and its legal system, without providing a reasonable alternative, thereby breaching the principle to act in good faith.

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 article 9 of the International Covenant on Civil and Political Rights (ICCPR), which protects the right to liberty and the right not to be arbitrarily detained;11 and

 article 3 of the Convention on the Rights of the Child, which requires that member states must give primary consideration to a child's best interests in all actions concerning children.12

2.11 Stakeholders particularly expressed concerns regarding Australia's international law obligations under the Refugee Convention, including the principle of non-refoulement, and article 26 of the ICCPR.

Refugee Convention

2.12 Submitters and witnesses commented on a range of international law obligations contained in the Refugee Convention, including:

 article 31(1) - the prohibition against the imposition of penalties on refugees;13 and

10 For example, Australian Lawyers for Human Rights, Submission 7, p. 4; Law Council of Australia (Law Council), Submission 13, p. 20; Hotham Mission Asylum Seeker Project, Submission 14, p. 3; St Vincent de Paul Society, Submission 15, p. 5; Coalition for Asylum Seekers Refugees and Detainees, Submission 18, p. 3; Refugee and Immigration Legal Centre (RILC), Submission 24, p. 2; Law Society Northern Territory, Submission 34, p. 2; Refugee Action Coalition, Submission 35, p. 2. These submissions argued that the proposed provisions breach article 14(1) of the Universal Declaration of Human Rights, by preventing unauthorised maritime arrivals from making a valid visa application and thereby seeking asylum in Australia.

11 For example, Law Council, Submission 13, pp 27-28; Australian Human Rights Commission, Submission 20, pp 8-9. These submissions argued that the Bill breaches article 9, by potentially subjecting unauthorised maritime arrivals to arbitrary detention in third countries.

12 For example, NSW Council for Civil Liberties, Submission 3, p. 7; Commissioner for Children and Young People, Western Australia, Submission 12, pp 1-2; Law Council, Submission 13, p. 28; Humanitarian Research Partners, Submission 19, p. 13; Office of the Commissioner for Equal Opportunity (SA), Submission 21, p. 2; Refugee Council of Australia (RCA), Submission 26, p. 3; Law Institute of Victoria (LIV), Submission 31, p. 9. These submissions argued that the proposed provisions breach article 3 of the Convention on the Rights of the Child, by failing to recognise that offshore detention in regional processing countries exposes children to violations of their human rights.

13 For example, Professor Ben Saul, Submission 1, p. 1; Dr Gabrielle Appleby, Associate Professor Alexander Reilly and Dr Matthew Stubbs, Submission 2, p. 6; Professor Penelope Mathew, Submission 6, p. 8; Professor Jane McAdam, Submission 11, pp 11-13; Law Council, Submission 13, p. 26; Hotham Mission Asylum Seeker Project, Submission 14, p. 4; Castan Centre for Human Rights, Submission 17, p. 3; Australian Human Rights Commission, Submission 20, pp 10-10; RILC, Submission 24, p. 2; Liberty Victoria, Submission 25, p. 11; RCA, Submission 26, p. 2; Ms Yanya Viskovich, Submission 29, p. 14. These submissions argued that the proposed provisions breach article 31(1) of the 1951 Convention Relating to the Status of Refugees, as amended by the 1967 Protocol Relating to the Status of Refugees (Refugee Convention), by penalising asylum seekers and refugees arriving in Australia by maritime means on or after 13 August 2012.

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 article 21(1) - the prohibition against the expulsion of refugees lawfully in the territory of a member state.14

Principle of non-refoulement

2.13 In general, stakeholders expressed the most concern in relation to the principle of non-refoulement (article 33(1)):

No Contracting State shall expel or return ("refouler") a refugee in any manner whatsoever to the frontiers of territories where his life or freedom would be threatened on account of his race, religion, nationality, membership of a particular social group or political opinion.15

2.14 A large number of submitters expressed concern that the Bill breaches the non-refoulement principle, by applying regional processing arrangements to all unauthorised maritime arrivals arriving by boat on the Australian mainland.16 Some stakeholders argued that Australia directly breaches this principle by, for example, not permitting refugee status determination to occur in Australia;17 while others contended that the breach occurs vicariously through the refugee status determination procedures in regional processing countries.18

2.15 The Law Council of Australia (Law Council), for example, submitted that the Refugee Convention does not specifically prohibit the excision of territory for migration purposes, or expressly mandate that Contracting States process asylum seekers within their borders:

However, the non-refoulement obligations contained in the [Refugee] Convention require [s]tate parties to provide access to a refugee status determination process that considers the individual circumstances of the person seeking protection and that complies with international standards and the object and purpose of the [Refugee] Convention.19

14 For example, Castan Centre for Human Rights, Submission 17, p. 3. This submission argued that the Bill contravenes article 32(1) of the Refugee Convention, by preventing unauthorised maritime arrivals from making a valid visa application.

15 Article 33(1) of the Refugee Convention.

16 For example, Dr Gabrielle Appleby, Associate Professor Alexander Reilly and Dr Matthew Stubbs, Submission 2, p. 6; Professor Jane McAdam, Submission 11, p. 11; Castan Centre for Human Rights Law, Submission 17, p. 5; Office of the Commissioner for Equal Opportunity (SA), Submission 21, pp 1-2; RILC, Submission 24, p. 2; RCA, Submission 26, p. 2; Ms Yanya Viskovich, Submission 29, pp 8-10; Law Society Northern Territory, Submission 34, p. 2.

17 For example, Australian Lawyers for Human Rights, Submission 7, pp 6-7; Liberty Victoria, Submission 25, p. 12.

18 For example, Professor Ben Saul, Submission 1, p. 1; Australian Human Rights Commission, Submission 20, p. 10; LIV, Submission 31, p. 6.

19 Submission 13, p. 21.

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2.16 Several submitters considered that current offshore refugee status determination procedures do not comply with international standards. Professor Saul stated that the Bill fails to meet these standards:

[B]y degrading the status determination procedure for more irregular arrivals, the Bill increases the probability of bad decisions and heightens the risk of refoulement.20

Discrimination among asylum seekers

2.17 The issue of discrimination between regular and irregular arrivals (unauthorised maritime arrivals) in Australia was also a concern in relation to article 26 of the ICCPR, which provides:

All persons are equal before the law and are entitled without any discrimination to the equal protection of the law. In this respect, the law shall prohibit any discrimination and guarantee to all persons equal and effective protection against discrimination on any ground such as race, colour, sex, language, religion, political or other opinion, national or social origin, property, birth or other status.21

2.18 Several submitters and witnesses argued that the proposed measures breach Australia's international law obligations under article 26 of the ICCPR, by discriminating among asylum seekers based on their mode of arrival in Australia;22 the time of their arrival;23 and also on the basis of race, or national or social origin due to certain groups of asylum seekers and refugees having no option but to travel by boat.24

2.19 The Law Council described the practical effect of such discrimination:

[The] Bill effectively creates two classes of refugees based on mode of arrival. Under the approach endorsed by the [Bill], a temporary visa holder arriving by air who becomes unlawful after visa expiry and subsequently applies for protection will have access to the Migration Act provisions and be able to access legal or migration assistance, merits review and judicial review in Australia. In contrast, a person who arrives by boat seeking protection will be liable to transferred to an offshore location. If this occurs,

20 Professor Ben Saul, Submission 1, p. 1. Also see Law Council, Submission 13, p. 20; RCA, Submission 26, p. 2; Professor Jane McAdam, Committee Hansard, 31 January 2013, p. 23.

21 Also see article 3 of the Refugee Convention, which provides that Contracting States shall apply the provisions of this Convention to refugees without discrimination as to race, religion or country of origin.

22 For example, Dr Gabrielle Appleby, Associate Professor Alexander Reilly and Dr Matthew Stubbs, Submission 2, p. 4; Castan Centre for Human Rights Law, Submission 17, p. 6; RILC, Submission 24, p. 2; Liberty Victoria, Submission 25, p. 10; Mr Richard Towle, UNHCR, Committee Hansard, 31 January 2013, p. 2.

23 For example, Professor Jane McAdam, Submission 11, pp 13-14; Ms Tania Penovic, Castan Centre for Human Rights, Committee Hansard, 31 January 2013, p. 10; Ms Rosemary Budavari, Law Council, Committee Hansard, 31 January 2013, p. 10.

24 For example, Law Council, Submission 13, p. 27; LIV, Submission 31, p. 5.

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he or she will be dependent upon whatever legal frameworks and processes apply in that location for his or her protection claim.25

2.20 Dr Appleby, Associate Professor Reilly and Dr Stubbs argued:

The concept of the excised offshore place makes sense if there is a territorial migration zone. However, the Bill completely changes the concept of the migration zone. It is no longer an absolute concept (where land is either in or out of the migration zone). It is now a relative concept. The same territory can be part of the migration zone, or not, depending on the mode of arrival of the person and their national identity.26

2.21 In evidence, Mr Towle from the UNHCR reflected on the current 'bifurcated' model of differential treatment, and asserted that the Bill entrenches this model:

In [UNHCR's] view, this bifurcated system can discriminate unfairly and arbitrarily on the basis of the manner of arrival if the rights and entitlements are significantly different, which in our assessment they will be under the current policy parameters of the government.

…[T]he UNHCR does not agree that deterrence is a legitimate justification by which substantially different treatment can be justified.27

Access to the legal system

2.22 Some stakeholders expressed concern that the measures proposed in the Bill deny asylum seekers and refugees access to the legal system in Australia,28 for example, by:

 transferring unauthorised maritime arrivals from Australia to regional processing countries (item 20 of Schedule 1);

 repealing certain transitory persons' rights to access the Refugee Review Tribunal, as set out in section 198C of the Migration Act (item 48 in Schedule 1);29 and

25 Submission 13, p. 26. For similar comments, see Dr Gabrielle Appleby, Associate Professor Alexander Reilly and Dr Matthew Stubbs, Submission 2, p. 4; Hotham Mission Asylum Seeker Project, Submission 14, p. 3; Office of the Commissioner for Equal Opportunity (SA), Submission 21, p. 1; Professor Mary Crock and Ms Hannah Martin, Submission 36, p. 4.

26 Submission 2, p. 4. For similar comments regarding the conceptual change, see LIV, Submission 31, p. 5. For similar comments regarding potential discrimination based on country of origin or race, see Law Council, Submission 13, p. 27; Officer of the Commissioner for Equal Opportunity (SA), Submission 21, p. 2; Liberty Victoria, Submission 25, p. 10.

27 Committee Hansard, 31 January 2013, p. 2. Also see Australian Human Rights Commission, Submission 20, p. 7 and LIV, Submission 31, p. 5, which did not accept saving lives at sea as justification for the discriminatory treatment.

28 For example, Dr Gabrielle Appleby, Associate Professor Alexander Reilly and Dr Matthew Stubbs, Submission 2, p. 5; NSW Council for Civil Liberties, Submission 3, p. 6.

29 For example, Hotham Mission Asylum Seeker Project, Submission 14, p. 5; RILC, Submission 24, p. 6.

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 banning the institution or continuation of certain legal proceedings against the Commonwealth, as set out in section 494AA of the Migration Act (items 51 to 58 of Schedule 1).30

2.23 The Law Council expressed concern that the Bill fails to adhere to several rule of law principles, including, for example, not providing 'unauthorised maritime arrivals' with equal access to competent and independent legal advice, as is available to asylum seekers arriving by air.31 Australian Lawyers for Human Rights agreed:

There is better access to legal representation when a refugee is processed in Australia, including a clearly defined process for the provision of interpreters, migration agents, solicitors and barristers. Historically, legal assistance to offshore detainees in declared countries is not only unavailable - it has been actively blocked.32

2.24 Mr Towle from the UNHCR highlighted the potential for discrimination in the rights, entitlements and treatment of people who have arrived by boat in Australia after 13 August 2012, and who have not been transferred offshore for processing:

[B]y far the majority of the post 13 August arrivals group will remain in Australia. In [UNHCR's] view, the rights and entitlements for their treatment in this country needs to be aligned as closely as possible to all other asylum seekers to avoid the kind of discriminatory treatment that… would be offensive to article 31 of the [R]efugee [C]onvention [the prohibition against penalisation of non-citizens].

For those people who will inevitably remain in Australia and be processed in Australia, we are concerned that they face uncertainty, delays to the commencement of their refugee status determination process and lesser rights and entitlements, potentially following recognition as refugees as well.33

Breach of rules of natural justice

2.25 Liberty Victoria and the Law Council particularly commented on proposed new subsection 198AE(1A), which will allow the Minister to vary or revoke a determination made under subsection 198AE(1) of the Act (item 31 of Schedule 1). Subsection 198AE(1) of the Migration Act allows the Minister to determine that a person is exempt from transfer to a regional processing country.

30 For example, NSW Council for Civil Liberties, Submission 3, p. 6; Humanitarian Research Partners, Submission 19, p. 5; Ms Yanya Viskovitch, Submission 29, p. 13; LIV, Submission 31, p. 9.

31 Submission 13, pp 30-31. For similar comments regarding the disparity in access to legal representation, see Federation of Ethnic Communities' Councils of Australia, Submission 23, p. 4; LIV, Submission 31, p. 8; Law Society Northern Territory, Submission 34, p. 3.

32 Submission 7, p. 7.

33 Committee Hansard, 31 January 2013, p. 2.

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2.26 Liberty Victoria described proposed new subsection 198AE(1A) as a 'retrospective power',34 and the Law Council remarked on it not being subject to the rules of natural justice (subsection 198AE(3) of the Migration Act; item 33 of Schedule 1):

The effect of these amendments is to invest the Minister with a broad power to reverse a decision that prevents a person from being transferred offshore - without requiring that this decision be made in accordance with the rules of natural justice. Any individual subject to these provisions will be placed in a precarious situation where decisions that could have a highly significant impact on their visa status and well-being can be made and changed without regard to basic principles of fairness and justice.35

2.27 The Law Council of Australia recommended that the Minister be required to:

…have regard to the full range of Australia's human rights obligations and [be] bound by the rules of natural justice when making decisions under section 198AE to exempt certain people from being transferred to a regional processing country, or to vary or change such an exemption, and to allow for judicial review of such decisions.36

Transferring responsibility to regional processing countries

2.28 Some submitters and witnesses argued that Australia is seeking to avoid its international protection obligations, by transferring responsibility for asylum seekers and refugees who arrive in Australia by boat to third countries for regional processing.37 For example, the Law Council submitted:

[The Bill] broadens the scope of the Government's offshore processing policy and leaves in no doubt the Government's intention to avoid a number of its human rights obligations at international law, and in particular its obligations under the [Refugee] Convention.38

2.29 According to the UNHCR, a member state cannot avoid its international law obligations on account of domestic policy:

[U]nder international law any excision of territory for a specific purpose has no bearing on the obligation of a country to abide by its international treaty obligations which apply to all of its territory. This includes the 1951 Refugee Convention, to which Australia is a party.

34 Submission 25, p. 8.

35 Submission 13, p. 33.

36 Submission 13, p. 7. The Law Council of Australia made a similar recommendation in respect of the exercise of ministerial discretion under section 46A of the Migration Act.

37 For example, Conference of Leaders of Religious Institutes in New South Wales, Submission 4, p. 2; Australian Lawyers for Human Rights, Submission 7, p. 3; Hotham Mission Asylum Seeker Project, Submission 14, p. 6; Mr Sean Bain, Submission 22, p. 8; Law Society Northern Territory, Submission 34, p. 3; Mr David Manne, RILC, Committee Hansard, 31 January 2013, p. 15.

38 Submission 13, p. 18.

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If asylum-seekers are transferred to another country, the legal responsibility for those asylum-seekers may in some circumstances be shared with that other country, but such an arrangement would not relieve Australia of its own obligations under the [Refugee] Convention.39

2.30 Several submitters and witnesses provided examples of instances in which Australia's international protection obligations could be breached, or are alleged to have been breached, by a third country to which asylum seekers and refugees have been sent from Australia for regional processing.40

2.31 Professor Mathew, for example, contended that Australia could only rely on Nauru and Papua New Guinea for the purpose of meeting international law obligations if those countries had relevant legal obligations, and could implement those

obligations in practice:

Nauru is not party to the ICCPR, and neither Papua New Guinea nor Nauru are party to [the Convention Against Torture and Other Cruel, Inhuman and Degrading Treatment or Punishment (CAT)]…Nauru and Papua New Guinea are bound by customary international legal obligations with respect

to torture and related ill-treatment, however it is foolhardy to rely on mere obligation alone and essential to ensure that the obligations are respected in practice.

Australia is relying on the procedures for determination of refugee status in [Papua New Guinea] and Nauru to ensure that Australia's own non-refoulement obligations are met under the Refugee Convention. In theory, these procedures would also go some way to ensuring that Australia's non-refoulement obligations under the ICCPR and CAT are met too. However, Papua New Guinea and Nauru do not presently have the capacity to determine refugee status fairly and efficiently.41

2.32 In this context, some submitters and witnesses argued that the Bill adversely affects Australia's international reputation,42 and does not encourage ratification of

39 Submission 28, p. 2. Also see Australian Lawyers for Human Rights, Submission 7, p. 4; Law Council, Submission 13, pp 21-22; Humanitarian Research Partners, Submission 19, pp 8-9; LIV, Submission 31, p. 6.

40 For example, Professor Jane McAdam, Submission 11, pp 9-10; Law Council, Submission 13, pp 22-23; Australian Tamil Congress, Submission 16, p. 2; RILC, Submission 24, p. 4; Mr Paul Power, RCA, Committee Hansard, 31 January 2013, p. 14.

41 Submission 6, p. 4. For similar comments in relation to capacity to fairly and efficiently determine refugee status, see Australian Lawyers for Human Rights, Submission 7, p. 3; Liberty Victoria, Submission 25, p. 12.

42 For example, see Ms Yanya Viskovich, Submission 29, p. 3; Associate Professor Alexander Reilly, University of Adelaide, Committee Hansard, 31 January 2013, p. 19.

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and compliance with international instruments.43 Stakeholders indicated further that the Bill undermines a multilateral, or regional, protection regime.44

2.33 At the public hearing, Mr Towle from the UNHCR commented:

[T]he practice of excising territory domestically not only impacts on Australia's international obligations but is also watched very carefully by other countries, which face different and sometimes similar problems and challenges around balancing the humanitarian and human rights needs of individuals against the legitimate concerns of state about border integrity and security. We are concerned that measures to excise large portions of territory to set up systems which substantially reduce fundamental refugee

protection rights set a negative precedent internationally. If all 148 countries that have signed the refugee convention were to set up similar kinds of systems, which are in essence designed to deter and relocate asylum seeker populations to other territories, this would have quite a significant and deleterious impact on the international system of refugee protection.45

Departmental response

2.34 Officers from the Department of Immigration and Citizenship (Department) confirmed that the Department has considered whether the Bill is consistent with Australia's international obligations:

Part of the paperwork around the tabling of the [B]ill was a statement about human rights obligations as seen against the purpose and the provisions of the [B]ill. We are of the view…and have advice to the effect that it is not in breach of our international obligations.46

2.35 A representative confirmed further that the Australian Government is working with both the Nauruan and Papua New Guinean Governments:

…the arrangements for refugee status determination and the memoranda of understanding that [we] have with those countries provides that all people who are transferred under these arrangements under our legislation will have access to refugee status determination processes.47

43 For example, Professor Penelope Mathew, Committee Hansard, 31 January 2013, p. 20.

44 For example, see LIV, Submission 31, p. 3; Mr Richard Towle, UNHCR, Committee Hansard, 31 January 2013, p. 2; Associate Professor Alexander Reilly, Committee Hansard, 31 January 2013, p. 19.

45 Committee Hansard, 31 January 2013, p. 3.

46 Dr Wendy Southern PSM, Department of Immigration and Citizenship (DIAC), Committee Hansard, 31 January 2013, p. 26. Also see Ms Vicki Parker, DIAC, Committee Hansard, 31 January 2013, p. 26.

47 Dr Wendy Southern PSM, DIAC, Committee Hansard, 31 January 2013, p. 26.

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Reporting requirements

2.36 At the public hearing, a few witnesses provided evidence in relation to the inadequacy of the Bill's reporting requirements. Ms Penovic from the Castan Centre for Human Rights commented:

The Migration Amendment (Designated Unauthorised Arrivals) Bill 2006 was the apogee, if you like, of the Howard government's Pacific strategy and, in effect, would have erased Australia's onshore protection program and converted it into a discretionary resettlement scheme. Yet this earlier bill would have required the minister to report on arrangements for refugee status assessment, accommodation, education and health care. The current bill lacks these safeguards, raising profound concerns about the protections accorded to those subject to its provisions.48

2.37 Professor McAdam also expressed concerns regarding the sufficiency of reports which are, or have been, presented to the parliament, and questioned whether the conditions in which people are detained offshore will in future be rigorously scrutinised.49

Committee view

2.38 The committee notes that the intent of the Bill is to prevent the further loss of life at sea by dangerous maritime journeys to Australia. Not only is this the stated rationale for the Bill,50 it was also a key factor in the deliberations of the independent Expert Panel on Asylum Seekers (expert panel), which recommended the current course of action to the Australian Government.51 Although the number of persons arriving at the Australian mainland is relatively small,52 the committee concurs that any loss of life at sea by persons seeking asylum is simply not acceptable.53

2.39 The measures adopted in the Bill represent one approach to resolving asylum seeker and refugee issues, and the committee is particularly mindful that the proposed legislation implements one of 22 integrated recommendations - all of which the

48 Committee Hansard, 31 January 2013, p. 9. Also see former section 198A of the Migration Act, which was repealed by section 25 of the Migration Legislation Amendment (Regional Processing and Other Measures) Act 2012. Former section 198A contained a requirement for the Minister to consider human rights obligations in the designation of a country for regional processing.

49 Committee Hansard, 31 January 2013, p. 23.

50 The Hon Chris Bowen MP, Minister for Immigration and Citizenship, House of Representatives Hansard, 31 October 2012, pp 12738-12739; the Hon Julia Gillard MP, Prime Minister and the Hon Chris Bowen MP, Minister for Immigration and Citizenship, 'Transcript of joint press conference', 13 August 2012, available at: http://www.minister.immi.gov.au/media/cb/2012/cb189223.htm (accessed 13 February 2013).

51 Expert Panel's Report, August 2012, p. 17 (Recommendation 14).

52 Dr Wendy Southern PSM, DIAC, Committee Hansard, 31 January 2013, p. 26; DIAC, answer to question on notice, received 13 February 2013, p. 1.

53 Expert Panel's Report, August 2012, p. 7.

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Australian Government has accepted in principle, and has committed to implementing.54

2.40 In view of the efforts currently being undertaken by the

Australian Government and regional processing countries to implement fair and effective regional processing arrangements,55 the committee supports the intent of the Bill, subject to one important amendment.

2.41 The committee considers that a comprehensive reporting requirement would be desirable, to ensure transparency and accountability in relation to regional processing arrangements. The committee considers that such an important requirement should be included in the Bill, to enable the parliament to properly scrutinise the arrangements for unauthorised maritime arrivals transferred to regional processing countries as a result of this legislation. The details to be provided to the parliament should cover issues such as refugee status determination procedures and their outcomes, as well as arrangements for the accommodation, health care and education of unauthorised maritime arrivals in regional processing countries.

Recommendation 1

2.42 The committee recommends that the Bill be amended to require the Minister for Immigration and Citizenship to report annually to both Houses of Parliament in respect of the following matters:

 arrangements during each 12 month period for unauthorised maritime arrivals seeking asylum, including arrangements for:

 assessing any claims for refugee st atus made by such unauthorised maritime arrivals;

 the accommodation, health care and education of such unauthorised maritime arrivals;

 the number of asylum claims by unauthorised maritime arrivals that are assessed during each 12 month period; and

 the number of unauthorised maritime arrivals determined during each 12 month period to be refugees.

54 The Hon Chris Bowen MP, Minister for Immigration and Citizenship, House of Representatives Hansard, 31 October 2012, pp 12738-12739; the Hon Julia Gillard MP, Prime Minister and the Hon Chris Bowen MP, Minister for Immigration and Citizenship, 'Transcript of joint press conference', 13 August 2012, available at: http://www.minister.immi.gov.au/media/cb/2012/cb189223.htm (accessed 13 February 2013).

55 See Dr Wendy Southern PSM, DIAC, Committee Hansard, 31 January 2013, p. 26; Ms Vicki Parker, DIAC, Committee Hansard, 31 January 2013, pp 28-29; Ms Kate Pope PSM, DIAC, Committee Hansard, 31 January 2013, p. 30.

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Recommendation 2

2.43 Subject to recommendation 1, the committee recommends that the Senate pass the Bill.

Senator Trish Crossin

Chair

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DISSENTING REPORT BY THE AUSTRALIAN GREENS 1.1 This Bill amends the Migration Act 1958 (Cth) so that when refugees arrive by sea they cannot access normal immigration procedures in applying for protection. It effectively excises the entire mainland Australia from the ordinary operations of the migration zone whenever a refugee or asylum seeker arrives by boat.

1.2 The two-tiered arrangement of protection application processing, in which refugees arriving by boat are treated differently to air arrivals, was first established by the Howard Government in 2001.

1.3 This Bill, proposed in 2012 by the Labor Government, goes even further than former Prime Minister Howard was able to in setting up discriminatory and punitive arrangements regarding asylum seekers who arrive by boat. The Bill is another aspect of the government's race to the bottom with the Coalition. Punishing refugees for seeking protection in Australia is the central concept of this Bill, even though there is ample evidence that many people who arrive here by boat have not had the opportunity of taking any other safer option.

1.4 This Bill has been heavily criticised by a wide range of legal and human rights experts who submitted to the inquiry. The Australian Greens concur with their views that this Bill is inconsistent with the spirit and purpose of the Refugee Convention to which Australia is party and undermines Australia's obligations under international law.

1.5 The primary effect of this Bill is that it would extend the punitive offshore processing regime to a new class of people - all asylum seekers who arrive on the Australian mainland. This means a wider group of men, women and children will be exposed under Australian law to being sent offshore to places including Papua New Guinea and Nauru for indefinite detention, in harsh conditions which do not adhere to the rule of law, human rights or basic compassion. There has been no evidence put forward to justify this Bill. It has been brought to Parliament on the basis of pure politics, on no strong policy basis, as part of the government and Coalition's race to the bottom to look tough on refugees.

1.6 For these reasons, the Australian Greens strongly oppose this Bill and recommend that it should not be passed.

Recommendation 1

1.7 The Australian Greens recommend that the Bill should not be passed.

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Senator Sarah Hanson-Young Senator Penny Wright

Australian Greens Australian Greens

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APPENDIX 1

SUBMISSIONS RECEIVED

Submission Number Submitter

1 Professor Ben Saul

2 Dr Gabrielle Appleby, Associate Professor Alexander Reilly and Dr Matthew Stubbs

3 NSW Council for Civil Liberties

4 Conference of Leaders of Religious Institutes NSW

5 Catholic Religious Australia

6 Professor Penelope Mathew

7 Australian Lawyers for Human Rights

8 Castlemaine Rural Australians for Refugees

9 Name Withheld

10 Ms Fabia Claridge

11 Professor Jane McAdam

12 Commissioner for Children and Young People WA

13 Law Council of Australia

14 Hotham Mission Asylum Seeker Project

15 St Vincent de Paul Society

16 Australian Tamil Congress

17 Castan Centre for Human Rights Law

18 Coalition for Asylum Seekers, Refugees and Detainees

19 Humanitarian Research Partners

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20 Australian Human Rights Commission

21 Office of the Commissioner for Equal Opportunity (SA)

22 Mr Sean Bain

23 The Federation of Ethnic Communities' Councils of Australia

24 Refugee and Immigration Legal Centre

25 Liberty Victoria

26 Refugee Council of Australia

27 Department of Immigration and Citizenship

28 United Nations High Commissioner for Refugees

29 Ms Yanya Viskovich

30 ACT Refugee Action Committee

31 Law Institute of Victoria

32 The Migration Institute of Australia

33 Australian Customs and Border Protection Service

34 Law Society Northern Territory

35 Refugee Action Coalition

36 Professor Mary Crock and Ms Hannah Martin

ADDITIONAL INFORMATION RECEIVED

1 Responses to questions on notice provided by Department of Immigration and Citizenship on 13 and 18 February 2013

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APPENDIX 2

WITNESSES WHO APPEARED BEFORE THE COMMITTEE

Canberra, 31 January 2013

BUDAVARI, Ms Rosemary, Co-Director, Criminal Law and Human Rights, Law Council of Australia

CONSTANTINOU, Ms Katie, Assistant Secretary, Community Support and Children Branch, Department of Immigration and Citizenship

HANSEN, Ms Ellen, Senior Protection Officer for Australia, New Zealand, Papua New Guinea and the Pacific, United Nations High Commissioner for Refugees

LARKINS, Ms Alison, First Assistant Secretary, Refugee, Humanitarian and International Policy Division, Department of Immigration and Citizenship

MANNE, Mr David, Executive Director and Principal Solicitor, Refugee and Immigration Legal Centre

MATHEW, Professor Penelope, Private capacity

McADAM, Professor Jane, Private capacity

MOULDS, Ms Sarah, Senior Policy Lawyer, Criminal Law and Human Rights, Law Council of Australia

PARKER, Ms Vicki, Chief Lawyer, Governance and Legal Division, Department of Immigration and Citizenship

PENOVIC, Ms Tania, Deputy Director, Castan Centre for Human Rights Law, Monash University

POPE, Ms Kate, PSM, First Assistant Secretary, Community Programs and Children, Department of Immigration and Citizenship

POWER, Mr Paul, Chief Executive Officer, Refugee Council of Australia

REILLY, Associate Professor Alexander, University of Adelaide

SOUTHERN, Dr Wendy, PSM, Deputy Secretary, Department of Immigration and Citizenship

TOWLE, Mr Richard, Regional Representative for Australia, New Zealand, Papua New Guinea and the Pacific, United Nations High Commissioner for Refugees

357