Second Reading Speech
Mr REITH (Minister for Defence)I move:
That the bill be now read a second time.
The object of this bill is to promote the smooth and efficient operation of Commonwealth royal commissions by improving their capacity to provide information to, and obtain information from, other agencies.
The Prime Minister recently announced two royal commissions.
The royal commission into the failure of the HIH Insurance Group will inquire into the reasons for and circumstances surrounding the failure of HIH. The failure of HIH is believed to be one of the largest corporate collapses in Australia's history. The government has committed $640 million to assist former HIH policyholders who are suffering hardship, and will be introducing legislative amendments to strengthen prudential arrangements for the insurance industry. The Australian Securities and Investments Commission is also investigating whether criminal or civil proceedings should be brought against any person as a result of the failure. The terms of reference for the royal commission require it to cooperate with ASIC's investigation.
The royal commission into the building and construction industry will inquire into possible unlawful or otherwise inappropriate practices and conduct in the building and construction industry. The Employment Advocate recently reported significant corrupt conduct and widespread coercive and collusive practices in this industry. Only a royal commission can provide the full and open public inquiry necessary to tackle this culture of intimidation.
These are issues of national importance, and the government is committed to ensuring that both royal commissions are able to conduct their inquiries in a timely and effective manner.
This bill will contribute to this goal in three ways.
Firstly, it will amend section 6P of the Royal Commissions Act 1902 to give royal commissions the power to report information about possible contraventions of the law to the responsible authorities. As currently drafted, the act may only give royal commissions the power to report information regarding possible criminal offences. There are many contraventions of the law, including taxation and corporations laws, which give rise to civil and administrative penalties instead. These contraventions can have a serious impact on the community, and the government believes that royal commissions should be able to report information about them to the responsible authorities. In particular, the royal commission into the failure of the HIH Insurance Group should be able to provide this type of information to ASIC to assist it with its investigation. The bill will give royal commissions this power.
Secondly, the bill will amend section 127 of the Australian Securities and Investments Commission Act 2001 to allow ASIC to provide confidential and protected information to royal commissions voluntarily. The act already allows ASIC to provide information to various agencies, including state and territory royal commissions. However, it does not allow ASIC to provide information to Commonwealth royal commissions. The government is concerned that this will hinder the royal commission into the failure of HIH in particular, and the bill will remedy this problem.
Thirdly, the bill will amend section 27 of the Financial Transaction Reports Act 1988 to give royal commissions whose terms of reference involve an inquiry into unlawful conduct access to financial transaction reports information reported to Australian Transaction Reports and Analysis Centre, AUSTRAC. The amendment will allow those commissions to follow the money trail associated with unlawful activities in a similar way to police investigation of unlawful activity. Bodies such as the royal commission into the New South Wales Police Service are already able to access this information, and the government believes that certain Commonwealth royal commissions should be able to access it too. Access by these commissions will be regulated by a memorandum of understanding between the Director of AUSTRAC and the relevant royal commissioner.
Finally, the bill will also make a further amendment to section 6P of the Royal Commissions Act to ensure that royal commissions are able to provide information to the Attorney-General of the Australian Capital Territory, along with other Attorneys-General around Australia. This amendment will take account of the fact that the ACT is now a self-governing territory.
The government expects that each of these amendments will improve the capacity of royal commissions to discharge the important roles assigned to them, both now and in the future. I present the explanatory memorandum to this bill.
Debate (on motion by Mr Fitzgibbon) adjourned.