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Legislative Council - Fifty-First Parliament, Third Session (51-3)
2009-11-19 Daily Xml
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STATUTES AMENDMENT (PUBLIC SECTOR CONSEQUENTIAL AMENDMENTS) BILL

Second Reading

Adjourned debate on second reading.

(Continued from 18 November 2009. Page 3948.)

The Hon. G.E. GAGO (Minister for State/Local Government Relations, Minister for the Status of Women, Minister for Consumer Affairs, Minister for Government Enterprises, Minister Assisting the Minister for Transport, Infrastructure and Energy) (17:37): By way of some preliminary concluding remarks, I want to thank the Hon. Rob Lucas for his contribution and his support thus far for the bill, albeit qualified. He has asked a number of quite technical and detailed questions. Answers have been provided to those questions, and I seek leave to have them inserted in Hansard without my reading them.

Leave granted.

1. Public Sector (Honesty and Accountability) Act 1995.

The Honourable Member asked a question about the reference to the Public Sector (Honesty and Accountability) Act 1995.

The Public Sector Management Act 1995 is amended by the Public Sector Management (Consequential) Amendment Act 2009 so as to retain only the honesty and accountability provisions (sections 6C-6ZF) and, as amended, is renamed the Public Sector (Honesty and Accountability) Act 1995.

The Public Sector Act 2009 sets out the employment framework for the public sector and includes annual reporting and immunity provisions.

The Public Sector (Honesty and Accountability) Act 1995 contains conflict of interest and other honesty and accountability measures.

The Public Corporations Act 1993 contains a special regime that may be applied to public corporations. I have a table of examples of public corporations which I seek be inserted into Hansard.

2. Non-consequential amendments

The Honourable Member asserted that there were a number of non-consequential amendments included in this Bill.

There are 2 amendments, and 2 amendments only, included in this Bill that are not strictly consequential on the Public Sector Act and Public Sector Management (Consequential) Amendment Act. They are in clauses 121 and 272. Both are minor editorial corrections of absolutely no consequence and including them in this exercise was designed to avoid spending any Parliamentary time on such trivial matters.

Clause 121 amends section 29 of the Equal Opportunity Act 1984—'person' is deleted to match amendments to all other provisions in the Act following enactment of the Equal Opportunity (Miscellaneous) Amendment Act 2009.

Clause 272 amends section 21A of the Police (Complaints and Disciplinary Proceedings) Act 1985—'member of police force' is replaced with 'designated officer' to match amendments to all other references in the section following enactment of the Protective Security Act 2007.

These are oversights of a printing error nature and are hardly worthy of comment and that is why no specific mention was made of them in the second reading speech. Possibly they could have been corrected through the use of the powers of the Commissioner for Legislation Revision and Publication under the Legislation Revision and Publication Act 2000, but the Commissioner, quite correctly, takes a cautious approach to the use of such powers and preferred in this case, out of an abundance of caution, to ensure that the corrections were achieved through Parliamentary amendment.

Every other clause in the Bill is consequential.

This does not mean that there are no substantive changes to the law—indeed substantive change is essential and intended in order to achieve consistency across the Statute Book, in particular, in relation to conflict of interest provisions for the public sector.

It is important to note that this whole exercise has been approached as one of a technical drafting nature and not one of a policy nature. Parliamentary Counsel undertook the work of examining the Statute Book and proposing what amendments were necessary as a consequence of the new public sector legislation and the previous honesty and accountability exercise (with a view to consistency and keeping the status quo wherever practicable). A draft Bill was then circulated to agencies so that agencies had an opportunity to raise any concerns in relation to their own legislation. Crown Law and Parliamentary Counsel officers had input into resolving the matters raised by agencies.

This was a massive exercise when one considers the number of provisions on the Statute Book affecting the public sector and the analysis uncovered all sorts of different approaches and oddities that have arisen over time and that required some sort of resolution.

It should be obvious from the approach that the only motive of the Government in this exercise is to clean up the Statute Book and make it rational.

To address the particular cases of apparent concern mentioned by the Honourable Member:

Adelaide Festival Centre Trust

Clause 13 of the Bill inserts a new section 6(4a) providing that 'A trustee may, but need not, be a Public Service employee.' This replaces section 16 (repealed by clause 14) which currently provides 'A trustee shall not, as such, be subject to the Public Service Act 1967, as amended, but this section does not affect the rights, duties and obligations under that Act of any trustee who is otherwise an officer in the Public Service of the State.'

Clause 15 deletes section 17 which is currently a limited provision requiring a trustee to declare financial interests in a matter before the Trust and not to act in relation to such matter in favour of the honesty and accountability provisions enacted in 2003. There is no reason for a trustee of the Adelaide Festival Centre Trust to be treated differently to members of other bodies. New section 17 elevates to the Act the exemption for Trustees that is currently contained in the Public Sector Management Regulations 1995.

Clause 16 simply substitutes an Act reference.

Courts Administration Act

The amendments maintain the status quo and are necessary because of the substitution of the Public Sector Management Act. The status quo is that there are some limitations on the powers of government generally to affect the employment arrangements within the Courts Administration Authority, in order to ensure judicial independence is not compromised. In addition, particular sections of the Public Sector Management Act are referred to in the Courts Administration Act. For both these reasons the amendments required are slightly more detailed than with other Acts. The amendments have been considered by the Authority.

New section 17A provides for delegation as currently provided through the Public Sector Management Act delegation provision (section 17).

New section 21B(1) excludes the Administrator and staff from the Public Service (see current s16(6) for the Administrator and section 21B(1) for staff).

Under new section 21B(2) and (3) Part 7 of the Public Sector Act is to apply (that is, the general employment provisions) subject to the regulations. Subsection (2) also makes sure that the employees are public sector employees for the other provisions of the Public Sector Act (for example, the principles) and are subject to the Public Sector (Honesty and Accountability) Act provisions (comparable to current section 21B(1) and (4)).

New section 21B(4) equates to current section 21B(3) and provides that machinery of government transfers are not to apply (comparable to current section 21B(3)).

New section 21B(4a) excludes the power to give whole of government directions to the Authority and is necessary in the context of the new Act.

New section 21B(4b) excludes functions of the Commissioner relating to monitoring and reporting on observance of determinations etc and to conducting reviews of public sector employment or industrial relations matters and equates to part of current section 21B(2) (comparable to the exclusion of section 22(1)(c) and (e) in current section 21B(2)).

The administrator can be declared to be a senior official for the purposes of the Public Sector (Honesty and Accountability) Act (remainder current s16(6)) and can be given the powers of a chief executive by notice under section 40 of the Public Sector Act (current section 17(3)).

Family and Community Services Act

Clause 138 substitutes the definition of Department to avoid the difficulties associated with references to departments by name.

Section 34 of the Public Sector Act 2009 allows the Premier or a Minister to appoint an acting chief executive and so clause 139 of the Bill removes section 8(4) which duplicates the section.

Clause 140 removes an ordinary immunity provision for persons engaged in the administration of the Act in the form that refers to honest acts or omissions. The matter is covered by section 74 of the Public Sector Act 2009.

Motor Vehicles Act

Clauses 217 and 218 of the Bill make amendments in order to remove references to the Department of Family and Community Services. These references have been changed in a manner requiring the regulations to specify the concession card to be recognised—this achieves the necessary level of specificity so that there can be no doubt about what cards result in a reduction in fees. It is intended that the regulations will refer to the administrative unit that is, under a Minister, responsible for the administration of the Family and Community Services Act.

Clause 219 removes an ordinary immunity provision for the Registrar, a Member of the review committee and a person engaged in the administration of the Act in the form that refers to an honest act or omission. Section 74 of the Public Sector Act covers the matter.

Solicitor-General Act

The Solicitor-General Act 1972 is amended because it contains references to the Public Service Act 1967. In fact, section 4 is obsolete and section 5 is unnecessary because the Solicitor-General is not in the Public Service since the conditions of appointment are determined by the Governor.

South Australian Housing Trust

Clauses 314 and 315 remove the honesty and accountability provisions and rely on those in the Public Sector (Honesty and Accountability) Act. There is no reason for a member of the board to be treated differently to a member of any other board. The interpretation provision (section 3) is amended to delete references that are only relevant to the deleted provisions. The current provisions match those for WorkCover and the Motor Accident Commission and will be described in more detail later.

New section 12 contains a more complex exemption that exactly matches clause 32 of Schedule 1 of the current Public Sector Management Regulations 1995.

Clause 316 deletes the immunity provision for members of the Board since this is covered by section 74 of the Public Sector Act 2009.

Clause 317 updates a reference to the Commissioner for Public Sector Employment and deletes the immunity provision for members of the Appeal Panel since this is covered by section 74 of the Public Sector Act 2009.

Not one of these matters alluded to by the Honourable Member has any hint of controversy or inappropriateness associated with the amendments. They are all clearly consequential and maintain the status quo in the context of the new Acts.

3. Changes to Honesty and Accountability Provisions

The Honourable Member refers to new drafting in connection with the conflict of interest provisions—it must be emphasised that there is no new drafting—the honesty and accountability provisions are as enacted by Parliament in 2003. In the Public Sector Management (Consequential) Amendment Act 2009 exercise, a minor adjustment was made to the exemptions for the disclosure of interests provision for corporate agency members, but nothing new is added in this exercise. The minor adjustment involved including the provision: 'A corporate agency member who is an employee of the agency or an employee employed or assigned to assist the agency will not be taken to have a direct or indirect interest in a matter for the purposes of this section by reason only of the fact that the member is such an employee.' This exemption had been included haphazardly in the Public Sector Management Regulations and in some Acts and the amendment generalised the approach and raised it to the level of the Act.

The Honourable Member questions changes to levels of penalties in relation to the honesty and accountability provisions. The time for debating the levels of penalties applicable for offences relating to disclosures of potential conflicts as compared to offences of acting dishonestly or entering into unauthorised transactions etc was in 2003 when the Statutes Amendment (Honesty and Accountability in Government) Bill was before the House.

When the honesty and accountability measures were introduced into the Public Sector Management Act 1995 by that Bill, it was with a view to creating a new standard that would be consistently met by various categories of public sector officials, workers and contractors right across government. It was known at that time that there were inconsistencies in penalties and approach and Parliament enacted a standard set of provisions that it considered appropriate.

The standard set of provisions was derived from the Public Corporations Act and was 'to ensure consistency across the whole public sector' (HA Hansard 8 May 2002 p45).

The scheme is comprehensive and covers duties to exercise care and diligence, duties to act honestly, duties not to be involved in unauthorised transactions and duties to disclose interests and particular conflicts.

The provisions are different for each of the categories covered—corporate agency members, advisory body members, senior officials, corporate agency executives, public sector employees and persons performing contract work for a public sector agency or the Crown.

There is absolutely nothing sinister in the adjustments to penalties and other aspects that result through consistent reliance on the provisions enacted for the purpose. Nothing can be made of the fact that some penalties are increased and some decreased since that is just a necessary result of achieving the consistency intended by Parliament when it enacted the Statutes Amendment (Honesty and Accountability in Government) Act. The only criticism that might be made is that it has taken too long to bring the consequential amendments to Parliament, but that should not mean that they are not worthy of support.

To address the particular cases of apparent concern mentioned by the Honourable Member:

WorkCover Corporation Act 1994 and Motor Accident Commission Act 1992

The set of honesty and accountability provisions included in these Acts match those included in the South Australian Housing Trust Act 1995. There is a pattern—a precedent that was no doubt copied from one Act to the other.

That precedent is closer to that currently contained in the Public Sector Management Act than that used in many other Acts on the Statute Book—the provisions are often limited to disclosure of interests requirements.

For the purposes of the Public Sector (Honesty and Accountability) Act, the members of the board of WorkCover and the directors of the Motor Accident Commission are 'corporate agency members'.

The Public Sector provisions relating to corporate agency members mirror, with relevant modifications, the provisions of the Public Corporations Act applying to directors of public corporations (ie sections 16 to 19 and 21 of the Public Corporations Act). The duties must be complied with by members of a public sector agency that is a body corporate or members of the governing body of a public sector agency that is a body corporate (in circumstances where the Public Corporations Act does not apply).

The duty to act honestly is the same and subject to the same penalties. The duty to act with care and diligence is the same except that the Public Sector approach contains a refinement which makes it an offence if a corporate agency member is culpably negligent in the performance of his or her functions. This refinement is designed to provide a level of certainty appropriate to a criminal offence.

The duty relating to disclosure of interests is similar, although the Public Sector (Honesty and Accountability) provisions require disclosures to be in writing and there is an additional requirement relating to personal or pecuniary interests that may conflict with duties but not relate to a matter under consideration by the agency. The penalty under the precedent is a Division 5 fine or Division 5 imprisonment and under the Public Sector provisions is a higher Division 4 fine. Imprisonment is reserved for the more serious honesty and accountability offences.

The Public Sector provisions will also impose a duty not to be involved in unauthorised transactions with the agency and not to have an unauthorised interest in the agency.

Provisions of the Criminal Law Consolidation Act (sections 249 to 253) relating to improper use of information and official position will no longer be duplicated. The Criminal Law Consolidation Act provisions are much more expansive

The immunity provision for members of the board of WorkCover is in the form that refers to an honest act or omission but not extending to culpable negligence. The one for the Motor Accident Commission is an unusual variation referring to anything done honestly and with reasonable care and diligence. Both of these approaches leave the member open to being sued personally by a person who suffers loss. Other immunity provision precedents refer to acts undertaken in good faith.

The Public Sector Act immunity provision provides immunity for all acts of an employee or board member and includes an express statement that the provision does not prejudice rights of action of the Crown or a public sector agency in respect of an act or omission of a person not in good faith.

Good faith is thought to be a higher threshold than honesty and so a good faith indemnity is narrower. For instance, the following acts may be honest acts but not acts in good faith:

recklessness, ie where a an office holder does an act or refrains from doing an act without caring whether or not the act or omission constitutes a breach of duty;

an office holder acts honestly but fails to make or real or genuine attempt to discharge their duties.

The Public Sector approach is to not expose public officers to civil suits but to ensure that the Crown or the relevant body corporate can take action against a public officer for any act or omission that is not in good faith.

It is difficult to see what justice would be served now by insisting on applying different standards to these corporate agency members than apply to corporate agency members under other Acts. There is no reason to think that the precedent that happened to be around in the early to mid 1990s should displace that which was worked out with a concerted effort and included in the Public Sector Management Act in 2003.

And it is slightly disingenuous for the opposition to be suggesting a concern that we are somehow easing standards. After all, when the honesty and accountability provisions were being debated in 2003, while the opposition were generally supportive, they expressed a clear concern that the provisions might be too draconian, and would lead good people not to serve on Boards.

I reiterate—this Bill is truly a consequential amendment exercise—akin to a Statute Law Revision exercise—and it should be treated by this House accordingly. There is, contrary to the insinuation of the Honourable Member, no ulterior motive or hidden intent behind these amendments.

The detailed explanation of this Bill to which the Honourable member referred has been provided to Family First and each independent member’s office. I urge members to read it if they continue to have any concerns.

As they read it, I hope that they will come to appreciate the patience and admirable attention to detail of Parliamentary Counsel - in this case Christine Swift - in putting this Bill together.

Public Corporations—examples

The Public Corporations Act applies to the following bodies:

Adelaide Cemeteries Authority

South Australian Forestry Corporation

South Australian Water Corporation

TransAdelaide

Subsidiaries established under Public Corporations Regulations:

Adelaide Convention Centre Corporation

Adelaide Entertainments Corporation

Adelaide Film Festival

Australian Children’s Performing Arts Company

Bio Innovation SA

Distribution Lessor Corporation

Economic Development Board

Education Adelaide

Generation Lessor Corporation

Land Management Corporation

Playford Centre

Transmission Lessor Corporation

2007 World Police and Fire Games Corporation

The Hon. G.E. GAGO: The Hon. Rob Lucas has not had a chance to look at those responses in detail and may want to put further questions on the record, so at this point it is probably best if I seek leave to conclude my remarks.

Leave granted; debate adjourned.

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