Statutes Amendment (Universities) Bill

Committee Stage

In committee.

Clause 1.

The Hon. I.K. HUNTER: I think at the second reading the Hon. Tammy Franks asked a number of questions regarding this bill, and I want to put on the record now some answers for her. The first question: why has the government not acted to ensure there is a minimum number on these university council bodies? Our response is that, if enacted, the act would specify the composition of the Flinders University Council. In practice, this means that the minimum size of the council would be 15, with council having the option to co-opt an additional member to ensure that it has the appropriate combination of skills and experience necessary for the corporate governance of a university.

The act would operate differently at the University of Adelaide, and the bill currently does specify that the council will consist of not less than 12 and not more than 16 members. This is to accommodate a degree of flexibility in the number of independent-appointed members, which I alluded to in my second reading close. The bill also specifies that a quorum is only achieved when there are one half of the total number of members, ignoring any fraction resulting from a division, plus one.

In response to her question: how is there no intention to weaken staff and student representation? While the bill does reduce the number of staff and student—and, in the case of the University of Adelaide, graduate—members of council, it does so in the context of an overall reduction in council size, but also affects independent-appointed members. As a result, the government would argue that the bill does not weaken staff and student representation, as a proportion of staff and student members of council remain broadly consistent with current levels.

The Hon. Tammy Franks asked: when was formal advice on the proposed amendments made to members of the NTEU and in what form? I am advised that the council held a series of discussions on the governance arrangements at the University of Adelaide throughout 2015 and 2016, and on 24 August 2015, approved the chancellor and vice-chancellor to commence discussions with the state government on this issue. Associate Professor Felix Patrikeeff, the Adelaide branch president of the NTEU, and Ms Julie Hayford, the Adelaide branch secretary of the NTEU, participated in these discussions as members of council.

I am advised that on 3 August 2016, the Hon. Kevin Scarce, the University of Adelaide Chancellor, wrote formally and met with Associate Professor Patrikeeff to discuss the amendments in his capacity as the Adelaide branch president of the NTEU. Minutes of the University of Adelaide council meetings are made available on the governance page of the staff intranet, I am advised. I am also advised that minutes are typically uploaded within a day, having been approved by the council, which occurs at the following council meeting.

I am also advised that the chancellor has provided regular updates to the council on the progression of the amendments, which will be reflected in the minutes accessible to staff at subsequent council meetings in March, April, May, July, August and December 2016. Finally, the Hon. Tammy Franks asked: when did that meeting with staff and representatives take place, who was the meeting with, and what was the resolution of those staff and representatives after that meeting?

The Minister for Higher Education and Skills met with representatives from the South Australian division of the NTEU, including members of the Adelaide and Flinders branches on a number of occasions. The minister heard their views and responded. No requests for meeting with the minister on this issue were rejected, I am advised, and the minister also met with student representatives from the University of Adelaide and Flinders University when they were requested as well.

The Hon. T.A. FRANKS: The minister says he is advised that the proportion of staff, student and graduate positions remains broadly consistent with the current levels. Given the University of Adelaide's council is reduced from 21 to 16, and five of these positions are two staff, two graduates and one student, can the minister explain the mathematics of how this retains the current proportion?

The Hon. I.K. HUNTER: If I take one institution, for example, I am advised of the current proportions that will change as follows: in terms of independently appointed members, which I think I said applied to the University of Adelaide, currently there are seven. The proposals in the bill are up to seven, and depending on how that is enacted, the changes would be roughly consistent. In terms of staff, currently I am advised that there are two general and two academic, which is a proportion of roughly 20 per cent of the current position. The proposal is to reduce it to one general and one academic, which is roughly about 17 per cent, possibly about 13 per cent, depending on the number of independent appointed members that are appointed as per my previous point.

The number of students currently is three, with at least one being an undergraduate and one being a postgraduate, which is currently around about 15 per cent. I am advised that that would be reduced in the legislation before us to one undergraduate and one postgraduate, which would be a slight increase potentially of between 17 per cent, or it may go down to 13 per cent, but roughly commensurate. In terms of graduates, the current position is three. The proposal is to go down to one, that is a reduction from about 15 per cent to roughly about 8 per cent, so there is a marked reduction there but, as I say, in the other measures, it is roughly commensurate. I think my language was, 'remain broadly consistent with current levels'.

The Hon. T.A. FRANKS: The information I have from the NTEU is that the bill currently before parliament does in reality reduce the proportion of staff and student representatives. Indeed, the elected positions are reduced from 46 per cent to 31 per cent, and appointed positions are increased from 38 per cent to 50 per cent. Does the minister dispute these NTEU figures?

The Hon. I.K. HUNTER: I do not have the figures before me and I am not in a position to debate them at all. All I can do is give the chamber the advice I have just given.

The Hon. T.A. FRANKS: Given that the Weatherill government, in correspondence to concerned constituents, maintained that the ratio had, in fact, not changed, is the minister concerned that the Labor government is misleading the public on this matter?

The Hon. I.K. HUNTER: I am not sure that the proposition the honourable member just led in the chamber is accurate. My advice is the language that was used in the correspondence was similar to the language I have just used in my answers to the question, which I put on the record, which was to say 'will remain broadly consistent with current levels'.

The Hon. T.A. FRANKS: Under sections 32 and 33, will the University of Adelaide council be able to pay themselves a commission for the management of investment common funds?

The Hon. I.K. HUNTER: My advice is that these two provisions are about the council investing its own funds and provide for them to have a fund manager in place, in which case you would then need to, of course, come to an arrangement about the conditions that you pay a fund manager.

I do not know why you would contemplate setting yourself up as the fund manager yourself where you are the beneficiary of the earnings of such a self-run fund and then pay yourself commissions. I am not aware of where the advantage may be. The honourable member may be able to enlighten me about that, but as far as I understand it, on my advice, this is about giving the council permission to engage a fund manager to manage their funds and to, obviously, strike a commission for the fund manager.

The Hon. A.L. McLACHLAN: If I may assist, I think the honourable member—and I do not want to put words in the honourable member's mouth—was raising the conceptual issue that the university could have a funds management arm, which it owns and it charges to the fund. So, the minister's logic is correct in the ordinary course: why would you be paying out and not receiving it as a beneficiary? It is a conceptual question, but you would in certain circumstances because you would then be taking it from the pool of the fund into the general revenue of the university and thus applied at the discretion of the CFO, versus taking it, potentially, from committed moneys to scholarships.

So, the question is relevant because the university gets the money as a whole, but some of that money may have to go out to bursaries and other universities. Really, the question is one of compliance. Does the section rule out self-enrichment, which is, in other contexts of trustee companies, strictly controlled under previous legislation when common funds were also used in pooling estates?

The Hon. I.K. HUNTER: My advice is that a proper reading of this construction would be to allow for the council to make provision for either a direct transfer to the fund manager or a transfer to the university to disburse to the fund manager. The council, in any case, needs to approve the level of commission, which gives a level of transparency and oversight to that process, is my advice.

The Hon. A.L. McLACHLAN: I suppose the real question is: where would that be disclosed outside of the council, because the council may like the arrangement if it is taking a profit out of the fund manager? I am not suggesting that that process is necessarily bad because they might have—the thing about universities is that they have a whole lot of technical skills on campus, so they are not exactly the usual corporation, if I can put it like that. So, where would that be, outside of the council itself? The council would be making that decision, so who would have the opportunity to reflect on that? Would it be in the annual report? I suppose that is the question I am asking.

The Hon. I.K. HUNTER: On the advice available to me, we would expect that there would be a report at least in the meeting minutes. One would expect that it would also be reported in the annual report of the university but I cannot unequivocally say that that is the case on the basis of what we have before us. Again, I am not sure about the exact mechanism of this but I would imagine that any fund manager has some commonwealth fiduciary obligations in terms of reporting publicly as well, certainly to their oversight body. However, again, I cannot give you the absolute degree of certainty you want about that. I might take that on notice for the honourable member and come back with a response.

The Hon. A.L. McLACHLAN: I am not asking the question to delay the bill, I am getting clarity, so if you can take that on notice. I suspect it would be audited. I suppose the more simple answer would be: if those arrangements had an internal fund management arm they would come within the remit of audit, then I think that would be an acceptable answer, but I would also like to know, of those relationships which are technical conflicts, as long as they are disclosed, where would they be disclosed?

The Hon. I.K. HUNTER: I will certainly get a response for the honourable member on that. I am also advised, of course, that they will be available and reported in the annual reports of the Auditor-General.

The Hon. T.A. FRANKS: In the minister's response to my previous question regarding when the Minister for Higher Education had met and consulted with the NTEU, a reference was made to meeting with the members of university council who were the staff representatives. Will the minister explain how that was a meeting with the NTEU when if a member of the NTEU is on the university council they are not there as a representative of the NTEU?

The Hon. I.K. HUNTER: That was not exactly what I said. Remember, it was in response to multiple questions asked by the Hon. Tammy Franks. When was the formal advice of the proposed amendments to the University of Adelaide Act made to the National Tertiary Education Union? To which members of the NTEU and in what form? When were staff given access to the council minutes for discussion on the issue? What was the date and in what form was that information provided? So, the five dot points that I read out in response to those contemplates that raft of questioning.

I suppose in the second dot point, where I said that this information was given at a meeting of the council and there were members of the NTEU who were formally on the council, that is when they would have had some advice on this as council members. The next dot point went on to say that when there was formal notification from the Hon. Kevin Scarce to the NTEU and so on.

The answers that I read out through those five dot points relate to the number of questions asked by the Hon. Tammy Franks. One of them, the second dot point, related to their membership as they were members of council, and the third dot point related to formal advice from the Hon. Kevin Scarce to them in their positions as NTEU officials.

The Hon. T.A. FRANKS: I acknowledge that there were several questions, and I did actually ask for specific dates and times and for clarity around when the minister engaged with the NTEU on this matter. Was it before or after the bill was drafted?

The Hon. I.K. HUNTER: Again, the honourable member can always go back and check the questions she asked and the answers I have just given. I have given dates, I have outlined where the information was provided to members of the NTEU, either as members of the council or in formal correspondence from the chancellor of the university, and I mentioned the date of 3 August 2016. Then, in response to the last question, I gave some responses about the meetings ministers had over a period of time and heard the views of various organisations and representative bodies. So, I think she will find, on closer reflection of the answers I have already given, that I have answered those questions.

The Hon. T.A. FRANKS: Given I asked these questions in the second reading stage, and it is common practice to respond to second reading questions before clause 1 and the minister chose to respond to my questions in clause 1 today, it would have been appropriate to have provided those answers to me in writing. The minister would have had them drafted. So, 3 August 2016, this is the golden date that is being presented as the date that the consultation occurred; is that the case? Can the minister indicate which day this bill was introduced into this parliament with regard to 3 August 2016?

The Hon. I.K. HUNTER: Chairman, I take issue with the statements made by the Hon. Tammy Franks. It is not common practice at all. At most stages of debate that I have been involved in it has been perfectly acceptable, so far, that questions that were asked in the closing stages of a second reading were answered at the first clause. That has been a common practice in this place as long as I have been here, so I dispute the assertion she has just made.

I reflect again on what I read into the Hansard. I am advised that on 3 August 2016 the Hon. Kevin Scarce, University of Adelaide Chancellor, wrote formally and met with Associate Professor Patrikeeff to discuss the amendments in his capacity as the Adelaide branch president of the NTEU.

The Hon. T.A. FRANKS: That was the date that Kevin Scarce met with the NTEU. What was the date that the minister met with the NTEU first on this bill? Was it before or after it was drafted?

The Hon. I.K. HUNTER: My advice is, as I have already reflected in my answers to your questions, there were a series of meetings that were held. I do not have those dates and times in front of me now, but as you will find when you read my answers previously, the Minister for Higher Education and Skills met with representatives from the South Australian division of the National Tertiary Education Union, including members of the Adelaide and Flinders branches of the NTEU, on a number of occasions, and I went on with another three or four dot points. That is the advice I have before me. I do not have any further information about what the relevant dates were of each individual meeting.

The Hon. T.A. FRANKS: On the point of it being common practice, it is not common practice necessarily to answer the questions on the same day that we enter a debate. I indicated that I would have appreciated the questions answered in writing. I note that respect was given to the Hon. Andrew McLachlan in answering his questions before we proceeded further in the debate, to give him a day to digest them. I would have appreciated a similar response.

I note that the minister is happy in this case that the very people most affected by this decision were not consulted appropriately and were not listened to by the Weatherill Labor government. Is it now the case that the Weatherill government has dumped the Premier's pledge that this government would not be a government of declare and defend but indeed a government of consult and decide, and are we back to the bad old days of declare and defend with this bill?

The Hon. I.K. HUNTER: What a ludicrous contribution. Quite frankly the Hon. Mr McLachlan gave us plenty of warning of his questions, unlike the Hon. Tammy Franks. Had she considered giving those questions to us in writing at some stage before the second reading close, she possibly could have got the answers earlier. The Hon. Mr McLachlan in his contribution several days ahead gave us warning, and we were then able to give him answers in the second reading closing speech.

The same courtesy would have applied to the Hon. Tammy Franks had she applied a certain level of courtesy to us in giving us advance notice of the questions. However, I did take them at the close of the second reading and undertook to give her answers during clause 1, which is common practice. As to the other comments she makes, they do not bear much comment back from me.

The Hon. T.A. FRANKS: I reflect that perhaps that courtesy might have been extended to the NTEU before the government actually introduced legislation affecting them. Clearly, it is back to the old days of declare and defend here, and damn the consequences and damn actually sticking by industrial democracy on our university campuses. We have seen misrepresentations about the ratios. The ratios of the elected members on these university councils are going down. I ask the minister: can he clarify why, given we are seeking in this bill to diminish university governance at a council level, the Adelaide University committee meeting this year was noncompliant with the act?

The Hon. I.K. HUNTER: This discussion of clauses is rapidly trending downwards into a general debate, I am afraid. In terms of the question the honourable member asked about an Adelaide University meeting, I do not have any information provided to me at this point in time in connection to what you may be talking about. I understand that they are required to have a public meeting, which I understand happened in February, where this matter was brought up. However, I do not have any details of the particular dates, who was there or any other information, other than that they had a public meeting in accordance with requirements.

The Hon. T.A. FRANKS: I draw the minister's attention to the fact that, under section 18 of the act, the annual public meeting is indeed required and is required within two months of the commencement of each financial year. The meeting was noncompliant in that way because it was held in February this year. The issue of this substantial legislative change was not put on the agenda of that annual meeting. It was not put on the agenda by the council. It was, in fact, only raised from the floor, where the chancellor stated that he saw no need for consultation. Thirty-six minutes and 45 seconds into that annual general meeting, Chancellor Scarce said:

I don't see a need to go to the broader community to have that engagement.

This is totally out of line with the comments made by the minister responsible for this bill, minister Close, who told the parliament on 30 November 2016 that:

…the universities put in place their own engagement processes to engage with their communities to explain the proposed amendments...

Why has the minister misled the parliament and accepted the words of the chancellor? Why has the minister not listened to the very people affected the most by this legislation?

The Hon. I.K. HUNTER: The only person who has misled parliament, as far as I know, is the Hon. Tammy Franks. As I understand it, and she is right, the council must, according to clause 18—Annual meeting:

…within 2 months of the commencement of each financial year, convene and attend an annual meeting of the University community.

As I have just been advised and have advised the chamber, that was held in February. The Hon. Tammy Franks may not know, and I have been advised now, that the financial year of universities is a calendar financial year, so it was within two months of the commencement of the financial year, as the universities operate.

So, the Hon. Tammy Franks has her information wrong or has been misled in some way or has assumed that the calendar year was a half-yearly calendar, but my advice is that universities operate on a calendar financial year. As such, they would have met the two-month timing of the commencement of their financial year by holding the public meeting in February.

The Hon. T.A. FRANKS: I thank the minister for an actual answer and acknowledge that I accept that the university has a different financial calendar year than the regular community in South Australia. I appreciate that level of information, because I can tell you that if you are looking for information about council decisions and you are a member of the university community—

The Hon. I.K. Hunter: Why can't you accept that?

The Hon. T.A. FRANKS: I have accepted that, minister. I am saying to you that the government should not be accepting at face value what they are told by the leadership of the university council, and that they have not done their due diligence in ensuring that students and staff were properly consulted and engaged in this process.

That is actually the job of a good government that is bringing in a bill that they say is for good governance. That AGM did not put this legislation on the agenda. I think it is completely outrageous to then have a Weatherill government backing up a university leadership that has claimed to have consulted. The minister should be asking more questions of these university councils before accepting and bringing, on their behest, legislation such as that we have before us here today.

The ratios are incorrect—that is quite patent. Could the minister also explain what research has been done with regard to the changing of the name of Flinders University? Are there any concerns that international students may not identify that university with our state as a result?

The Hon. I.K. HUNTER: On the final question that the Hon. Tammy Franks asked about the change of name, my advice is the universities have campuses across the country. I think Flinders has one in the Northern Territory and they certainly have campuses in South-East Asia. I would find it very unlikely that the greatest university in the world would be taking a decision on changing its name that would disadvantage it in terms of competing or in attracting students to South Australia.

In regard to the earlier question about the minister seeking some information, I am advised that the minister did actually write to the vice-chancellors of the universities seeking their response to questions of engagement. She has received letters back from both the University of Adelaide and Flinders University, signed by Professor Colin Stirling on the Flinders situation and signed by Rear Admiral the Hon. Kevin Scarce in regard to the University of Adelaide, in light of the current debate on the Statutes Amendment (Universities) Bill 2016. The minister is relying on advice from the governor organisations and the vice-chancellors and the presidents of the universities responsible. That is what you would expect ministers to do.

The Hon. T.A. FRANKS: I have to say, you do not necessarily expect a Labor minister to ignore the industrial union that is involved in the sector when they are in fact slashing their places on the council. The minister clearly is happy that the Labor Party has not consulted with the NTEU in an appropriate manner on this matter. I do not actually expect them to have bothered consulting with the students given the contempt that they have shown over many years for students on our campuses with the corporatisation of education in this state. Indeed, we are seeing the corporatisation of TAFE in this state—a Labor legacy coming home to roost at this point.

The minister is clearly not going to answer my questions. It is standard practice that second-reading questions are answered before proceeding to the second reading vote and into clause 1. The minister may find that that is somehow an aberration for this bill, because everything about this bill in terms of consultation has been an aberration. I think it is reflecting that they want to ram this bill through, damn the consequences and silence the student and staff voices.

The minister and the Labor government may be happy with that, but the Greens are certainly very concerned that this flags a lessening of the student and staff voices on these campuses. It is a shame to the Labor government that they have abandoned their core values.

The Hon. I.K. HUNTER: I reject completely the colour the honourable member has put into that description about the minister's appropriate level of consultation in this matter. I just remind her and the chamber that this bill has been before parliament since 30 November of last year, so it is hardly a situation of being rammed through, for goodness sake.

The Hon. T.A. FRANKS: I just remind the minister that you should have consulted before bringing the bill and drafting the bill, rather than after. That is what the difference is between 'declare and defend' and 'consult and decide'. That was the downfall of the Rann Labor government, and I think it will be the downfall of the Weatherill Labor government.

The Hon. A.L. McLACHLAN: I have a few questions for the minister at clause 1. These come out of the minister's responses to the second reading summing up by way of clarification. I should add, given the context of these questions, that the Liberal Party is not opposing this bill and nor is it supporting amendments. My purpose with these questions is to understand and get on Hansard the process between the state and the university. I thank the minister and, through him, the staff who put together those responses.

In the minister's second reading, he said the government gave careful deliberation, as I would expect, to the request by the university. Does 'careful deliberation' mean a process was gone through? Would it be legitimate for the government to say simply that the university is best placed to give advice on the governance of its own affairs, or was there a process that the responsible minister went through in addition to receiving the information to test the assumptions? I am not talking about consultation here: I am talking about what is in the best interests of the state, since it is a state asset.

The Hon. I.K. HUNTER: I thank the Hon. Andrew McLachlan for that further question. My advice is that universities are required to undertake governance reviews from time to time under their federal regulations. Flinders University approached the government seeking a range of amendments to the Flinders University of South Australia Act 1966, as I understand it, arising from such a review of their governance.

In response, the Department of State Development commenced a process of consulting with all three public universities on potential amendments to their acts. I think I covered this in my second reading. The proposed amendments to the Flinders University of South Australia Act and the University of Adelaide Act 1971 contained in the bill were developed through that consultation process.

In particular, I am advised that the universities were consulted through the Premier's higher education committee, which comprises the Premier, the Minister for Employment, Higher Education and Skills, the Minister for Investment and Trade, the Minister for Manufacturing and Innovation and vice-chancellors of the three public universities. I am advised that the University of South Australia elected not to pursue any amendments to the University of South Australia Act 1990 at this time. I think I also advised that in my second reading summation.

That is the formal origin of the legislation, I suppose, that is before us, and the way the government engaged with the universities and the processes and the organisations, in this case the Premier's higher education committee, which discussed it.

The Hon. A.L. McLACHLAN: I thank the minister for that answer. In essence, it does answer my question. At one stage, there was a collaborative approach as opposed to—I am trying to get away from the word 'adversarial'—an exchange of letters. That is where I was going. I thank the minister and his staff for that question.

Just on the internal processes of the university, I think we have well traversed the consultation road. When the council signs off exactly what it wants, does it then take it to its senate, or anywhere else, or does it go direct? It is simply a technical question. Are there any other technical steps within the university hierarchy?

The Hon. I.K. HUNTER: My advice is that beyond the government review, which would have involved council and the university engaging with the academic senate or the board, there are no other formal requirements, but of course in the correspondence we received from the universities, particularly the Adelaide University, they advised us of a formal decision of their council. I might just reflect very quickly on part of one of those letters to give the honourable member a feeling for the breadth of their internal discussions. A letter to the minister from Rear Admiral the Hon. Kevin Scarce states:

Discussions on improvements to Council governance were conducted throughout 2014, 2015 and 2016. Illustrative of these extensive discussions were:

In 2014:

Council commissioned a Review of Governance in which all members participated. This review concluded that a reduced size of the Council might improve its overall effectiveness.

In 2015

29 March 2015: at the Council Retreat the Chancellor led a discussion on Outstanding Board Performance, where the size of the Council was one of the issues debated.

25 May 2015: at the Council meeting the Chancellor discusses proposed specific changes to reduce the size of Council.

6 August 2015: the Chancellor invited all elected members of Council affected by the proposed changes to the University of Adelaide Act to meet with him. All elected members accepted this invitation.

24August 2015: Council approved:

the Chancellor and Vice-Chancellor to engage with State Government on amendments to the University's governing legislation with respect to (1) an amendment to the size (not composition) of Council; (2) an extension of the power to delegate under section 10; and (3) a new section to expressly provide for a common investment fund.

At this Council meeting the Chancellor reemphasised that representation of staff, students, and graduates would be maintained.

12 October 2015: at the Council meeting the Chancellor reported that the State Government had broadly accepted the University's proposed changes to the University of Adelaide Act. A commitment was given that any cuts would be applied to both appointed and elected members.

In 2016, progress was reported to Council at its meetings in March, April, May, July, August and December.

That gives, if you like, an extensive understanding of the internal processes that the Adelaide University, at least, went through in this particular situation.

The Hon. A.L. McLACHLAN: I thank the minister for that comprehensive answer. It was excellent and fills in the gaps for me. I would like to go to one other issue, which is the payment of board fees. I know the response the minister has given, and he may wish to take this on notice. The minister I think said in response to my questions that they do not receive board fees, so the Chancellor of the University of Adelaide receives an honorarium.

I would like to know what the honorarium is. If it is not at hand, I do not want it to delay the progress of the bill, but I would like to be advised by letter. The minister then said that there are no current proposals. I have heard that, and I may have even used it myself in another context, but I would like to know (and it can be by letter) whether there have been proposals in the past. Has it been discussed at any time—I will be fair—in the last five years by the university council?

The Hon. I.K. HUNTER: I will undertake to find out what the honorarium is and bring that back for the honourable member. My advice is that yes, there was a discussion about a fee that was raised not at council—I guess we are talking about Adelaide University here—but at some sub-body of council but my understanding is that that was also killed very quickly. Again, I will make inquiries for the member and see if I can bring back further details.

The Hon. A.L. McLACHLAN: Can that be for both universities?

The Hon. I.K. HUNTER: I can certainly make inquiries for both.

Clause passed.

Clauses 2 to 6 passed.

Clause 7.

The Hon. T.A. FRANKS: I move:

Amendment No 1 [Franks–1]—

Page 3, lines 30 and 31 [clause 7(2)]—Delete subclause (2)

Amendment No 2 [Franks–1]—

Page 4, lines 1 and 2 [clause 7(3)]—Delete subclause (3)

Amendment No 3 [Franks–1]—

Page 4, line 3 and 4 [clause 7(4)]—Delete subclause (4)

This suite of amendments restores the elected positions of students and staff to the university councils because the government has chosen not to keep the ratio. In fact, they have chosen to make the bulk of the cuts from the elected representatives in terms of this quest to meet this magical number of between 22 and I think it is 15 or 16. There is no reason or rationale for that particular magical number.

I think this chamber, with 22 members, and the other place, with 47 members, make decisions in their own ways and to their own culture, and universities have, over a significant period of time, made decisions that are to their culture. But this is an indication that student and staff voices are to be cut and culled from the very governing bodies of universities, and those who are on the ground at the very pointy end, the coalface if you like, of the decisions that the university councils will make will have the least say at the table.

The Greens put this amendment to keep the current representation of student and staff because we are shocked and surprised—well, actually, no, we are just disappointed. We are not shocked and surprised; in fact, it is just more of the same from the Weatherill Labor government, but we question why the Labor government continues to not ensure if not industrial democracy but that the academic community is respected and that those student and staff voices are at the table when decisions are made that affect them the most.

The Hon. I.K. HUNTER: I thank the Hon. Tammy Franks for moving her amendments all together; the government will not be supporting any of them, of course. I am not sure that the amendments moved by the Hon. Tammy Franks will do what she thinks they will do. They certainly reduce the representation from 21 currently down to 19. The bill, if it is supported, will reduce it further to 16. However, the current levels of staff and student membership on the councils would be retained under the Hon. Tammy Franks' amendment.

My advice is that councils would shrink from 21 to 19, as I said, but as a result there would not be a material change to the operation of the councils, which undermines the key purpose of the bill from the respect of the universities. Further, the reduction in numbers will only come about through reducing the number of independent appointed (in the case of University of Adelaide, graduate members of council), so this would alter the proportions between the classes of council members such that independent appointed members would be in the minority, I am advised.

The purpose and point of bringing this to parliament by the universities is the fact that universities recognise the need to exercise corporate governance effectively. Organisations such as the Australian Stock Exchange, the Australian Institute of Company Directors, Universities Australia, the G20 and the Organisation for Economic Co-operation and Development have all produced guidance on corporate governance structures, and in each case that guidance stresses the importance of having the appropriate combination of skills and expertise, be they financial, corporate, risk management, business and strategic, a majority of independent members and an overall size that is not so large as to not become unwieldy.

So, reducing the numbers of appointed members of council, while maintaining the current size of staff and student members, I think would threaten that skills mix required of council, resulting in, as I said, independent members being in the minority. I am not sure that is what the Hon. Tammy Franks would want, on reflection, to be the outcome of her amendments, but in any case it would not appreciably impact councils' overall size, which is the point of one of the amendments, which would detract from any ability to get greater effectiveness of the way council operates. For those reasons, the government will oppose the amendments.

The Hon. J.S. LEE: I indicate that the Liberal opposition will not support the amendments.

Amendments negatived; clause passed.

Clause 8 passed.

New clause 8A.

The Hon. T.A. FRANKS: I move:

Amendment No 1 [Franks–2]—

Page 4, after line 7—Insert:

8A—Amendment of section 16—Appointment of Chancellor, Vice-Chancellor etc

(1) Section 16(4)—delete 'subsection (5)' and substitute:

this section

(2) Section 16—after subsection (4) insert:

(4a) Despite any other provision of this Act, or any other Act or law, the salary of the Vice-Chancellor as determined by the Council must not exceed the salary payable to the Premier of South Australia (determined in accordance with the Parliamentary Remuneration Act 1990) at the time the Council makes the determination.

(4b) Nothing in subsection (4a) affects the salary payable to the Vice-Chancellor holding office on the commencement of this subsection, but that subsection will apply in relation to each appointment or reappointment of a Vice-Chancellor following that commencement.

I note that there is also amendment No. 2 [Franks-2]. If you like, I can move them both together.

The CHAIR: No, apparently they are separate.

The Hon. T.A. FRANKS: I will move amendment No. 1 and note that the vote will be consequential. This amendment, quite simply, seeks to ensure that at the decision-making table the vice-chancellors' future salary packages will be capped at no greater than that of our state's Premier. At the moment, they are in excess of $1 million annually. Of course, the university community only finds out through the commonwealth reporting what these salary packages actually are so we could be a year behind the times, but we know that currently at Adelaide and Flinders those packages are both in excess of $1 million a year.

I put this because, in fact, Australian academic institutions, universities across the country, are out of step internationally in terms of the senior management salary packages that are being awarded as we see continuous commonwealth funding cuts on our campuses. In fact, the vice-chancellor of Oxford university gets nowhere near the amount that the vice-chancellors of Adelaide and Flinders universities receive.

I think when the community is informed that our vice-chancellors are currently receiving pay packages well more than two, almost three, in fact, possibly larger than three times that of the Premier of this state they are surprised. I think it is no surprise that those people want to reduce the voice of students and staff at the decision-making table because they will have to explain those decisions when they sit at those tables. I was interested to hear the minister's answer before that indeed there was some consideration given to the council members receiving payment but that it was quickly quashed.

I fear in the future that it may not be so quickly quashed and so seek to secure and ensure than any ability for vice-chancellors of the future to continue to give themselves, through these secretive bodies, further extraordinary payments, when we are seeing cuts to library staff and when we are seeing overcrowded classes—when an academic staff member takes an entire year to earn what the vice-chancellor of his or her campus earns in a week, something is wrong in our universities.

The Hon. I.K. HUNTER: I rise to indicate that the government will not be supporting this amendment. I want to point out to the chamber that, despite perhaps a compelling oration from the Hon. Tammy Franks, this amendment is not well thought through and I will outline the holes in it. Clearly, it is here for grandstanding purposes. When you think about competition for the best talent in the higher education sector being as fierce as it is, you do understand what the proposal in this amendment means is that it will not be very attractive to come to South Australia to head up one of our universities.

The honourable member talks about the vice-chancellor of the University of Oxford but she fails to mention that the headline remuneration that the vice-chancellor of Oxford might get would probably not represent the entire remunerative package that is on offer, which might include lordships, board memberships, other stipends and chairs of various 500 or 700-year-old institutions, not to mention the prestige value of being a vice-chancellor of the University of Oxford. To limit the salary of the vice-chancellors at the University of Adelaide and Flinders University in the way proposed in this amendment would hinder their ability to compete for that best talent and would undermine their international reputation.

The Hon. Tammy Franks says we are out of step internationally, but what she is seeking to do is put us out of step with the rest of Australia, and it would certainly undermine our ability to attract talent from international universities. It would also mean that vice-chancellors—and this is one of the problems with coming up with amendments like this—at the University of Adelaide and Flinders University would earn less than some of the other senior executives at their universities.

In addition, the ability of the University of Adelaide and Flinders University councils to determine the vice-chancellors' salary would be limited in a way that University of South Australia is not. Again, this amendment creates real discrepancies, which I do not think the honourable member has taken into consideration. I will just finally say, without the ability to attract and retain the best vice-chancellors, the standard of education and research at these two institutions—critical institutions for our state—would be severely undermined and for those reasons we will not be supporting either this amendment or the subsequent one.

The Hon. J.S. LEE: I rise to indicate the Liberal opposition will not be supporting the amendments.

The Hon. T.A. FRANKS: Is the minister therefore indicating that the worth of an academic institution is determined by the salary of its vice-chancellor? And my second question is: is the minister, by equating that salary package as being required to attract the best talent, saying that we do not have the best Premier that we could possibly have?

The Hon. I.K. HUNTER: Mr Chairman, I have just been verballed again by the Hon. Tammy Franks. I mean exactly what I said.

The CHAIR: You are not the only one that has been verballed today, minister. The Hon. Ms Vincent.

The Hon. K.L. VINCENT: I just wanted to place on the record that, while I certainly empathise with the Hon. Ms Franks' intent in moving these amendments, I cannot support this. I think that if the market supports vice-chancellors earning a certain amount then perhaps it should be allowed.

Unfortunately, lots of people earn more than the Premier, for a variety of reasons. I think it is also worth pointing out that higher education is the fourth biggest economic contributor to the South Australian economy, largely because of the huge international student enrolment in Adelaide. Given those large responsibilities, I am hesitant to support this amendment, although I very much understand the intent in which it is moved.

The Hon. T.A. FRANKS: I will just quickly add that, indeed, I understand the Hon. Kelly Vincent's concerns and I put this amendment to this bill to point out the ludicrous nature in which this bill came before us without proper consultation by these vice-chancellors with their university communities. That is why I did not choose to include the University of South Australia's vice-chancellor in this amendment. That was a conscious decision, although the minister might think it was somehow forgotten. Indeed, I am from the University of South Australia and was on the university council of South Australia as the student representative. I would not have forgotten the University of South Australia in any way.

I finally note that no less than the federal minister Simon Birmingham has actually called for some restraint to be brought in with regard to Australian vice-chancellors' salary packages and senior management salary packages. He, quite rightly, has belled the cat. The salaries are getting ridiculously high when we are seeing extraordinary and chronic university cuts. Something is wrong when an academic staff member can only earn in a year what a vice-chancellor earns in a week.

New clause negatived.

Clauses 9 to 14 passed.

Clause 15.

The CHAIR: The next amendment is the Hon. Ms Franks.

The Hon. T.A. FRANKS: This is consequential and as I noted before I only sought to raise this point because the vice-chancellors of Flinders University and Adelaide University did not see fit to properly and appropriately consult the university communities, and indeed the Labor government was happy to let that happen. I thought they should be exposed for the sham of a process that this bill is. I will not be moving it.

Clause passed.

Clause 16.

The CHAIR: The next amendment is amendment No. 4 [Franks-1]. The Hon. Ms Franks.

The Hon. T.A. FRANKS: I assume this is consequential. As I have indicated before, I will not be pursuing those amendments.

Clause passed.

Remaining clauses (17 to 20), schedule and title passed.

Bill reported without amendment.

Third Reading

The Hon. I.K. HUNTER (Minister for Sustainability, Environment and Conservation, Minister for Water and the River Murray, Minister for Climate Change) (17:20): I move:

That this bill be now read a third time.

Bill read a third time and passed.