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Parliamentary Library Briefing Book Key Issues for the 43rd Parliament Foreword

This Briefing Book has been written to assist senators and members to prepare for significant issues that are expected to arise in the early months of the 43rd Parliament. It presents a brief introduction to areas of key public policy concern, outlines the context for those concerns and discusses possible new policy and legislative directions.

The issues are presented in summary form. Senators and members are encouraged to contact the Parliamentary Library researchers identified against each contribution for further assistance © Copyright 2010 Commonwealth of Australia with confidential oral or written briefing, analysis The federal election of 2010 produced the first or information. In addition, individual senators This work is copyright. Except to the extent of uses permitted by the Copyright since 1940. The Gillard Labor and members can request research on any Act 1968, no person may reproduce or transmit any part of this work by any Government retained power by the smallest parliamentary and policy issue by contacting the process without the prior written consent of the Parliamentary Librarian. This possible majority with the support of three Parliamentary Library. Requests can be made requirement does not apply to members of the acting in independents and the . To through: the course of their official duties. secure a governing , the committed to a series of wide-ranging • the Library’s Central Enquiry Point (extension This work has been prepared to support the work of the Australian Parliament parliamentary reforms with the Australian Greens 2500), or using information available at the time of production. The views expressed do and the Coalition including new procedures for • the contacts in the Parliamentary Library’s not reflect an official position of the Parliamentary Library, nor do they constitute Question Time in the House of Representatives, online Guide to Services at http://library. professional legal opinion. enhancing the authority of the Speaker, strengthening the role of committees, increasing The Briefing Book is available in hard copy to Feedback is welcome and may be provided to: [email protected]. Any the prominence of private members’ business and senators and members. It is also available online concerns or complaints should be directed to the Parliamentary Librarian. establishing a Parliamentary Budget Office and through the Senators’ and Members’ Services Parliamentary Integrity Commissioner. Portal, the Parliamentary Library’s intranet and the Parliamentary Library staff are available to discuss the contents of publications Parliament’s web site. For copyright reasons, some with senators and members and their staff. To access this service, clients may Key challenges before this unique parliament will of the linked sources in the electronic version of contact the author or the Library’s Central Entry Point (02) 6277 2500 for referral. include implementing those reforms, making them the document may not be accessible through the work and dealing with their likely consequences, Internet. Published by the Parliamentary Library, Department of Parliamentary Services, while continuing to address important national Parliament House, Canberra. legislative and policy issues. Such issues include I am confident that the Briefing Book will be a climate change, population pressures, regional valuable resource for all senators and members. Production: Publishing Section, Parliamentary Library. development, economic prosperity, reforming I and all my staff look forward to supporting the social services and meeting environmental and work of the 43rd Parliament throughout its term. Printed by Canprint Communications Pty Ltd, energy needs. At this stage it appears that the 16 Nyrang Street, Fyshwick ACT 2609 proposed procedures will enable backbenchers Roxanne Missingham and committees to play a greater role in shaping Parliamentary Librarian Coordinators and editors: Richard Webb and Mark Rodrigues. the agenda of the parliament. This might mean that an even greater variety of issues will be brought 16 September 2010 Cover image: Ben Warren. before the new parliament.

Page | i Contents

Parliament and public administration reform 2010 Federal election 2 Composition of the 43rd Parliament 4 Hung parliament 6 Parliamentary reform 8 Enabling the franchise 10 Australian Public Service reform 12

Reforming social services and institutions School reform 14 Meeting the need for higher level skills through tertiary education reform 16 A health care system for the 21st century 18 Improving the health of all Australians: the role of preventative health 20 Funding support for people with disability 22 The challenge of housing the nation 24

Addressing social disadvantage Tackling ‘corrosive’ welfare 26 Welfare to work: a reform agenda in progress 28 Indigenous affairs: shared goals, elusive outcomes 30 Population and infrastructure Australia’s future population 32 Population growth: what role does immigration play? 34 Challenges of an ageing population 36 Building sustainable cities 38 Regional population trends in Australia 40 Population and the natural environment 42 Broadband telecommunications 44

Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Page | iii Environment and energy Parliamentary Library Briefing Book: The politics and science of climate change 46 rd Emissions control policies 48 Key issues for the 43 Parliament Renewable energy targets 50 Powering Australia from renewable sources 52 Climate change action: a multi-faceted approach 54 Strengthening the Environment Protection Biodiversity and Conservation Act 56 Murray-Darling Basin water issues 58 Marine oil pollution 60 Tasmanian forests: future agreement? 62 International whaling 64 The minerals sector 66 Law, justice and human rights Public sector accountability and transparency 68 Indigenous people, local government and other constitutional issues 70 Same-sex marriage 72 Parliament and the protection of human rights 74 ‘Property’ and acquisition on just terms 76 Plain packaging of tobacco products 78 The nation’s economy Domestic economy overview 80 Australia, China and the Global Financial Crisis 82 Australia’s future tax system 84 International comparisons of national debt 86 Emissions taxes 88 Australia in the world Australia’s regional engagements in East Asia and the Asia Pacific 90 Australian Defence Force in Afghanistan 92 The Defence Strategic Reform Program (SRP) 94 Refugees: Australia’s humanitarian response 96 The Iranian nuclear program 98 Australia’s engagement with the United Nations 100 Free Trade Agreement negotiations with North Asia 102 Copenhagen: a stepping stone 104

Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Page | 1 The result The three ‘country independents’ (and former 2010 Federal Election Nationals) worked together in their dealings Opinion polls throughout the campaign revealed with the parties but came to their own separate Rob Lundie, Politics and Public Administration Section that a hung parliament was a real possibility, and decisions as to who they would support. Bob so it turned out to be. Labor won 72 seats, the Katter (independent, Kennedy, Qld) chose Coalition 73, the Greens one and there were four to support the Coalition while Tony Windsor independents. (independent, New England, NSW) and Rob Oakeshott (independent, Lyne, NSW) went with The 2010 Federal Election was held on Saturday important state where Labor’s proposed mining There was a swing against Labor of 2.6 per cent the ALP. So, the was granted 21 August and resulted in a hung parliament – tax was a significant issue. but it won the two party preferred vote 50.1 a second term, securing the smallest possible the first federally since 1940. The election was per cent to the Coalition’s 49.9 per cent. The majority of 76 to 74 to pass the Budget and survive called by Prime Minister on 17 July. Gillard began her campaign revealing that she was seats won by the parties and the change from no confidence motions. The independents and She had successfully challenged Kevin Rudd ‘moving forward’ although she was often forced the 2007 election are shown in the table below. the Greens member reserved the right to vote for the leadership of the Australian Labor Party to look back when answering questions about her These figures are based on votes counted to 15 differently on other matters. (ALP) on 24 June following a marked decline in ‘removal’ of Kevin Rudd. Disquiet over the way he September and could change. support for the ALP in the polls. Her opponent was removed, even amongst those who supported Voter turnout nationally was 93.2 per cent down was Liberal Party leader who had Gillard, and particularly amongst Both major parties began negotiations with the 1.5 per cent from the last election. The informal defeated for the leadership on voters in Rudd’s home state, threatened to Greens and independent members in an attempt vote nationally was 5.55 per cent in the House of 1 December 2009. The House was dissolved and interfere with her desire to portray a new beginning to gain their support in the House to form stable Representatives, an increase of 1.6 per cent. In the Senate prorogued on 19 July when the writs for Labor. government: in effect ensuring they would have the Senate, the informal vote was 3.75 per cent, an were also issued. the numbers to pass supply and to defeat any no increase of 1.2 per cent. Her campaign also received a setback when it was confidence motions. In return for their support, The 14 088 260 people enrolled to vote included leaked that she had questioned pension increases the major parties responded to lists of demands Senate 57 732 who were added to the roll following the and aspects of a parental leave scheme when they which, among other things, sought a greater High Court’s decision on 6 August to extend were discussed in Cabinet. Parental leave was policy focus on regional Australia, a series of Labor lost one senator, the Coalition three and the the period for enrolling to 26 July. There were an area in which both parties put schemes to the parliamentary reforms, and an assurance that Greens gained four senators. From 1 July 2011 the 1198 candidates (1421 in 2007): 849 for the 150 electorate. whichever party formed government, it would Greens, with nine senators, will have the balance of House of Representatives seats and 349 for the serve a full term and provide stability. Prime power. This fact played a part in the independents’ 40 Senate vacancies. There were 353 female While Gillard was dealing with the Rudd factor and Minister Gillard was soon able to secure the decision to support Labor in the House of candidates and 845 males. the leaks, Abbott was trying to distance himself support of Andrew Wilkie (independent, Denison, Representatives thus increasing the likelihood of a from Work Choices, even signing a declaration that Tas) and (Greens, , Vic). longer period of stable government. Redistributions it was ‘dead, buried and cremated’. Members of the Australian Parliament Prior to the election, redistributions had been held Abbott campaigned on the slogan ‘real action’ in NSW, Qld, WA, Tasmania and the NT. As a result to take advantage of his popular image as a man House of Representatives Senate Qld gained one seat (Wright) taking its tally to 30. with physical energy and stamina. This theme was Before After Party Pre-election Post-election NSW lost a seat reducing its representation to 48. highlighted when he campaigned throughout the July 2011 July 2011 night on the last day of the campaign. Australian Labor Party 83 72 32 31 The campaign Coalition 63 73 37 34 Both leaders were keen to portray themselves as Liberal Party of Australia 54 44 32 25 The campaign featured a single formal leaders’ economically responsible and declared that they The Nationals/Country Liberal 9 8 5 3 debate on 25 July at the National Press Club in were not going to make big spending promises Liberal National Party - 21 - 6 Canberra where they faced questions from a panel during the campaign. Parental leave and a national Australian Greens - 1 5 9 of journalists. There were two community forums broadband network were two main areas of policy Independent 4 4 1 1 on 11 August in western Sydney and on 18 August difference. Family First - - 1 - in Brisbane where the leaders faced questions Democratic Labor Party - - - 1 from an audience of voters. The Coalition stopped submitting its policies to Treasury for costing after a document was leaked Total 150 150 76 76 Both leaders campaigned extensively in which allegedly revealed an $840 million hole. It Queensland and NSW where most of the marginal then commissioned its own costings report by a Library publications and key documents seats were located and where it was expected the private firm late in the campaign. Australian Electoral Commission Virtual Tally Room as at 15 September 2010 with 93.21 per cent of the election would be won or lost. WA was also an primary vote, and 90.76 per cent of the two party preferred vote, counted, http://vtr.www.aec.gov.au/

Page | 2 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Parliament and public administration reform Page | 3 rd in 1918, and Andrew Jones (LIB, Adelaide, SA), constitutes the highest number of elected Composition of the 43 Parliament 22 years six months when elected in 1966. independent/minor party MPs in the House of • Ken Wyatt (LIB, Hasluck, WA) becomes the Representatives since 1996, when there were Martin Lumb, Politics and Public Administration Section first indigenous member of the House of five Independents. Representatives. Former Senators Neville • The election of Tony Crook (Nationals, Bonner (LIB, IND, Qld) and Aden Ridgeway (AD, O’Connor, WA) marks the first time the party NSW) remain the only indigenous members has held a Western Australian seat in the lower elected to the upper house. house since the departures of John Hallett House of Representatives Gender • Ed Husic (ALP, Chifley, NSW) becomes (Country Party, Canning, WA) and Donald the first Muslim elected to the House of Maisey (Country Party, Moore, WA) in 1974. Following the election, the number of women in The 2010 election saw the election of 29 new Representatives. • John Madigan (DLP, Vic) is the first successful the House of Representatives has declined from members to the House of Representatives, • The election of Adam Bandt (Greens, Democratic Labor Party candidate since 41 (27 per cent) to 37 (25 per cent). When the new together with the return of three Coalition members Melbourne, Vic.) marks the first time the Greens the November 1970 half-Senate election at Senators take up their places on 1 July 2011, the who did not retain their seats at the 2007 won a seat in the House of Representatives which five DLP Senators were elected. These number of women in the Senate will rise slightly election, Warren Entsch (LNP, Leichhardt, Qld), at a general election. Michael Organ (Greens, Senators served until the double dissolution of from 27 (35 per cent) to 29 (38 per cent). Overall Teresa Gambaro (LNP, Brisbane, Qld) and Ross Cunningham, NSW) won at a by-election in May 1974. the number of women in Parliament will decline Vasta (LNP, Bonner, Qld). This new component 2002 but was subsequently defeated at the from 68 (30 per cent) to 66 (29 per cent). The figure constitutes approximately 20 per cent of the general election of 2004. below illustrates trends in the number of women in chamber. This compares with 39 new members • The election of four Independents and one the House of Representatives since 1983. at the 2007 election (26 per cent of the chamber). Green to the House of Representatives Of the 32 members who left the House of Representatives, 20 retired and 12 were defeated Milestones at the election. The election produced a number of milestones: Senate • The 43rd Parliament is the first hung Parliament Of the 40 senators up for re-election, who will since the election of 21 September 1940. begin their terms on 1 July 2011, all but 12 were • Julia Gillard becomes the first elected female re-elected. Six did not contest the election and Prime Minister. six were defeated. The 12 new senators, including • 20-year old Wyatt Roy (LNP, Longman, Qld) David Fawcett (LP, SA) the former Member for becomes the youngest member of the House Wakefield from 2004 to 2007, will comprise of Representatives since Federation. The approximately 16 per cent of the new Senate. This previous youngest members of the House of compares with 14 new Senators (18 per cent) after Representatives were Edwin Corboy (ALP, the 2007 election. Swan, WA), 22 years two months when elected

Number of women in the House of Representatives 1983-2010 45

40

35

30 25 Library publications and key documents

20 Parliamentary Library, Parliamentary Handbook of the Commonwealth of Australia, Canberra, 15 http://www.aph.gov.au/Library/handbook/index.htm

10 S Miskin and M Lumb, The 41st Parliament: middle-aged, well-educated and (mostly) male, Research Note, 5 no. 24, 2005-06, Parliamentary Library, Canberra, 2006, 0 http://www.aph.gov.au/library/Pubs/RN/2005-06/06rn24.pdf

1983 1984 1987 1990 1993 1996 1998 2001 2004 2007 2010 Images courtesy of the Parliamentary Education Office: http://www.peo.gov.au Total HoR women ALP NonALP

Page | 4 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Parliament and public administration reform Page | 5 government, and their agreements with the experience of minority governments, including the Hung parliament Government state that the parliament should current ACT and Tasmanian Governments. serve its full term. This means that the next federal Cathy Madden and Dr Nicholas Horne, Politics and Public Administration Section election would be due in late 2013. Senate The last hung Parliament occurred after the Since 1949 it has often been the case that the election of 21 September 1940. Labor and the government has not had control of the Senate. In Coalition of the and the fact, the only periods of a government majority in After a general election the party that holds commission the leader of the majority party to form Country Party emerged with 36 seats each in the Senate have been 1951–6, 1959–62, 1975–81 a majority of the 150 seats in the House of a government. the House of Representatives. The balance of and 2005–07. In the periods when the government Representatives normally forms government. By power resided with two independents, Alex has not had control of the upper house the Senate convention the Governor-General commissions the A secondary convention is that if, after an election, Wilson (Wimmera, Vic) and Arthur Coles (Henty, has often been accused of being ‘obstructionist’. person who holds the confidence of the House as no-one emerges with the confidence of a majority Vic), who supported the incumbent Menzies Prime Minister to lead the government. Normally of the House, the incumbent Prime Minister, as Government and enabled it to remain in office. The dynamics of the Senate are likely to be there is no problem in identifying this person as the last person to hold a majority, has the right to The independents’ support lasted until late 1941 very fluid both before 1 July 2011 and after that he or she is the leader of the which remain in office and test his or her support on the when they voted against the Budget of the now date when the new senators take their places. holds a majority of seats on the floor of the House. floor of the House. Fadden-led Coalition Government, leading to the Votes on individual policies and legislation may resignation of Fadden and the commissioning of be determined on a case-by-case basis. Under The 2010 election is remarkable for its close The 43rd Parliament the Curtin Labor Government on 7 October 1941. section 23 of the Constitution votes in the Senate result, with neither of the major parties reaching are determined by a majority of votes, with the the required 76 seats in the House to form Following the 2010 election, three of the non- While minority governments are uncommon at President being entitled to vote. If votes are equal government. This is known as a hung parliament. aligned independents together with the Australian the federal level, the states have had considerable the question is passed in the negative. The Australian Constitution does not specifically Greens member decided to support a Labor deal with the situation of a hung parliament. , agreeing to ensure supply According to constitutional experts, hung and to oppose no-confidence motions initiated by parliaments are resolved by a set of unwritten rules others. This provides the Labor Government with or conventions inherited from the United Kingdom. majority support in the House of Representatives.

Conventions In recent years the possession of a clear majority in the House of Representatives by the governing The 2010 election left Julia Gillard as ‘caretaker’ party has been the norm. In the 43rd Parliament, Prime Minister while negotiations took place as to however, this will not be the case, and the which party would form government. Before an closeness of voting on motions or legislation election result is clear, convention requires that means that a small loss of support could place the Governor-General act on the advice of the the government in a difficult position. Under caretaker Prime Minister. Generally, the Governor- section 40 of the Constitution votes in the House Library publications and key documents General should act contrary to that advice only are determined by a majority of votes, other than where the rules have not been followed—for the Speaker, who has a casting vote if the votes Australian Labor Party and the Independent Members Oakeshott and Windsor, Agreement, 7 September example where a Prime Minister sought to stay on are equal. 2010, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22library%2Fjrnart%2 despite having lost majority support in the House F218795%22 of Representatives. In such a case the Governor- Under section 35 of the Constitution the first General could dismiss the Prime Minister and business of the House is the election of the Australian Labor Party and the Australian Greens, Agreement, 1 September 2010, http://parlinfo.aph.gov.au/ commission a new government. In the event that Speaker, and in the past this has been an early test parlInfo/search/display/display.w3p;query=Id%3A%22library%2Fjrnart%2F218794%22 a new government could not be commissioned, of whether the government has the support of the the Governor-General would need to call another House. For the 43rd Parliament, it has been agreed C Pyne, Agreement for a Better Parliament, 7 September 2010, http://parlinfo.aph.gov.au/parlInfo/search/ election. that the Speaker’s vote will be cancelled-out by display/display.w3p;query=Id%3A%22media%2Fpressrel%2F202239%22 virtue of the Speaker being paired with the Deputy Once the election result becomes clear an Speaker. A Twomey, The Governor-General’s Role in the Formation of Government in a Hung Parliament, Legal incumbent Prime Minister must, by convention, studies Research Paper No. 10/85, Sydney Law School, August 2010, http://papers.ssrn.com/sol3/papers. resign if another party wins a majority of seats The negotiations between the major parties cfm?abstract_id=1666697## in the House of Representatives. In Australia and the cross-bench MPs took place in the it appears to be the custom for the resigning public spotlight. One outcome sought by the Prime Minister to advise the Governor-General to independents and Greens was stability of

Page | 6 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Parliament and public administration reform Page | 7 committees for inquiry and consultation prior House, the Speaker and ultimately the government. Parliamentary reform to their introduction in the lower House. The Another major proposed reform is to establish a issue of encouraging greater transparency from code of conduct for senators and members and a Dr Mark Rodrigues, Politics and Public Administration Section government has been a particular matter of Parliamentary Integrity Commissioner to oversee contention for Senate committees. Proposals the code, advise parliamentarians on ethical issues to address the lack of cooperation from the and report on parliamentary entitlements. Other Adversarial politics is a well entrenched feature of The independence of the Speaker government in providing information to committees proposals for reform include increasing the time Australian parliamentary democracy. Strict party include referring individual instances to the allocated for the business of Private Members discipline over the behavior of MPs has challenged Part of the role of the Speaker is to ensure that Information Commissioner for arbitration. (MPs other than Ministers, the Speaker/President conventions of responsible government and aided the proceedings of the House are conducted in and Parliamentary Secretaries), increasing the the ascendency of the executive over the agenda accordance with relevant rules, conventions and Support for budget scrutiny number of sitting days, and reducing the time of parliament. Decades of majority government standards of behavior. While Speakers have strived allocated for members to speak on Bills. have shaped the rules of parliamentary procedure to carry out their duties impartially, the position Non-government MPs are particularly (the Standing Orders of each House) in a manner is normally filled by a government MP and often disadvantaged in their access to independent Possible reforms excluded from the current that limits opportunities for non-government MPs drawn into partisan conflict when ruling against high quality analysis and advice on government package of measures include further asserting the to hold the government to account. However, points of order from the opposition. It has been expenditure. Internationally, many parliaments have independence of committees by enabling more the small but growing presence of minor party proposed that the authority and independence created specialist units to undertake economic to be Chaired by non-government members and and independent MPs has called into question of the Speaker be enhanced by requiring that the forecasting, policy costing and expert financial encouraging more ‘conscience votes’ so that the two-party winner-take-all culture of politics. Speaker and Deputy Speaker are drawn from analysis. The parliamentary reform package MPs are not compelled to vote on party lines. The potential for reforming procedure is much different parties, that they both abstain from party includes a plan to establish a Parliamentary There is also a broader category of parliamentary broader where no single party holds a majority. room meetings, and when one is in the Chair, the Budget Office within the Parliamentary Library. Key reform that requires constitutional amendment. Independent MPs have secured some significant other abstain from voting in divisions. Members of questions concerning the new Office include its This category includes the grounds for the parliamentary reforms working with state the Speakers Panel, when acting as Chair, could level of resourcing, ability to access government disqualification of MPs, fixed four-year terms and minority governments. The wide-ranging reforms similarly have their vote ‘paired’ with an abstention information and the range of services it will the process for resolving deadlocks between the negotiated between political parties, independents from their opposing party, so as to maintain the provide. These matters are likely to be considered Houses over contentious legislation. and the Greens following the 2010 federal election relative voting strength of each party in the House. by a parliamentary committee. have potential to change the relationship between In sum, the package of measures negotiated will the parliament and the executive. The committee system Other reforms likely lead to an increase in committee activity, scrutiny of government and private members bills. Question time Committees have to some extent counteracted Currently, the funding for the general operation of The increased participation of non-government a perceived decline in parliamentary standards parliament is determined through the government’s MPs will certainly act as a further brake, or Question Time in the House of Representatives by facilitating cross-party cooperation on policy own budget processes. The proposal to establish check, on the progress of the government’s is often criticised for declining parliamentary development and scrutinising the detail of a House Committee on Appropriations and agenda through parliament. It may be that some standards and accountability. Oppositions are government activities. Other key functions of Staffing (similar to the existing Senate committee) of the reforms might need revision due to the inclined to use partisan attacks disguised as committees include reviewing policy, facilitating has the potential to improve the financial autonomy increased parliamentary work required. The key questions to embarrass the government to public participation in the legislative process of the parliament. The role of the new committee to implementing these reforms and making them which Ministers respond with lengthy answers of and making recommendations. Areas for includes estimating the funding required by the work lies in the attitude and behavior of individual marginal relevance. Ministers often use Question improvement in the committee systems include House of Representatives and reporting to the MPs, political parties and the government. Time to attack the opposition with pre-prepared the independence of committees, the often slow statements in response to ‘Dorothy Dix’ questions response by government to committee reports, Library publications and key documents from their own side. Much of the theatre of and the tendency of the government to withhold Australian Labor Party and the Independent Members Oakeshott and Windsor, Agreement, 7 September Question Time is characterised by disorder important information from committees on the 2010, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22library%2Fjrnart%2 contrived to make the evening news. Proposals grounds that disclosure would be against the F218795%22 to reform Question Time include enabling ‘public interest’. supplementary questions, imposing time limits Australian Labor Party and the Australian Greens, Agreement, 1 September 2010, http://parlinfo.aph.gov.au/ on answers, and requiring answers to be relevant Proposals for reforming the House of parlInfo/search/display/display.w3p;query=Id%3A%22library%2Fjrnart%2F218794%22 to questions. Other areas for reform include the Representatives Committee system include allocation of questions, the treatment of points of rationalising the size and number of committees, J Gillard and A Wilkie, Agreement, 2 September 2010, http://parlinfo.aph.gov.au/parlInfo/search/display/display. order and the use of prepared statements. enabling them to determine their own inquires w3p;query=Id%3A%22library%2Fjrnart%2F218796%22 (rather than undertaking inquiries at the request of Ministers) and requiring timely government R Laing, ‘Parliamentary reform: options and pitfalls’, 31 August 2010, http://parlinfo/parlInfo/download/library/ responses. It has also been proposed jrnart/64987/upload_binary/64987.pdf;fileType=application/pdf#search=%22Laing%20Parliamentary%20 that controversial legislation be referred to reform%20options%20and%20pitfalls%20%20|%20EBSCO,AAP%22

Page | 8 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Parliament and public administration reform Page | 9 After the Court’s declaration the Australian • lower the donation disclosure threshold from Enabling the franchise Electoral Commission (AEC) moved to facilitate the $11 500 to $1000 enrolment of those otherwise excluded by virtue of • prevent donation-splitting Dr Nicholas Horne and Dr Mark Rodrigues, the amendments. Initially the AEC estimated that • ban foreign donations and anonymous Politics and Public Administration Section around 100 000 extra voters would be eligible to donations over $50 vote in the 2010 election. Closer to the election • increase the frequency of disclosure, and the AEC indicated that an extra 57 732 voters had • link electoral funding to campaign expenditure. been enrolled and that a further 40 408 voters had Electoral administration was a key area for definition of misleading or deceptive publication their enrolment details updated. A number of these measures were introduced by legislative amendment during the previous to include the telephone and the internet the Government in 2008 and 2009 in legislation parliament. Proposals to amend the • enabling pre-poll votes cast in an elector’s It remains to be seen whether the Government that did not pass the Senate. Commonwealth Electoral Act 1918 and the ‘home’ division to be cast and counted on revisits its legislative programme in relation to Referendum (Machinery Provisions) Act 1984 arose polling day as ordinary votes roll closure and evidence of identity in the 43rd The agreements also commit the signatories to from reports of the Joint Standing Committee on • restricting the number of candidates that Parliament. The main issues in contention have establish a parliamentary committee inquiry into Electoral Matters and Government green papers can be endorsed by a political party in each been the integrity of the electoral roll and voting further election finance reform options in 2010–11. on electoral finance reform and the electoral division, and system, the potential for electoral fraud and the The agreement with the Greens further notes that system. • enabling electronic voting for sight-impaired possible disenfranchisement of voters. the Greens’ preference is for full public funding of electors. elections. Major issues examined in those reports included Election finance reform the increasing costs of political campaigning Likely areas of contention in the new parliament The Prime Minister has also signed a further and fundraising pressures, the extent to which include the close of rolls period, the evidence of The Labor Party has signed agreements with the agreement with another non-aligned independent, the the Commonwealth Electoral Act 1918 identity requirements for provisional voters, and Australian Greens and two of the non-aligned Andrew Wilkie. This agreement recognises that effectively facilitates participation in elections, election finance reform. independents (Tony Windsor and Rob Oakeshott) work is underway on the reform of ‘Funding of and the potential to harness new technologies in committing the signatories to legislation that will: political parties and election campaigns’ and administrative processes. It was recognised that Close of rolls and evidence of identity commits the signatories to collaborate on this, but the electoral system must adapt to these ongoing requirements for provisional voters does not specify further actions. challenges in order to uphold democratic values of fairness, transparency and integrity. Under amendments to the Commonwealth Electoral Act 1918 introduced in 2006 the electoral Recent voter behaviour provides an indication of rolls close either on the date federal election the scale of those issues. At the time of the 2007 writs are issued or on the third day after issue federal election, more than 1.1 million people who depending on the type of enrolment. were eligible, did not enrol to vote, over 700 000 enrolled people did not vote, and over 500 000 Two elements of the Government’s 2010 legislative informal votes were cast. In sum, more than reform package were: 2.3 million Australians did not fully participate in the election despite being entitled to do so. The • setting the seventh day after the issue of federal methods of voting are also changing. For example, election writs as the date for the close of the Library publications and key documents the proportion of postal and pre-poll declaration electoral rolls, and voting has gradually increased over a number of • repealing evidence of identity requirements Australian Labor Party and the Independent Members Oakeshott and Windsor, Agreement, 7 September elections. for provisional electors and providing for a 2010, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22library%2Fjrnart%2 signature checking procedure. F218795%22 Areas amended during the previous parliament include: The Bills containing these measures did not pass Australian Labor Party and the Australian Greens, Agreement, 1 September 2010, http://parlinfo.aph.gov.au/ the Senate and lapsed with the conclusion of the parlInfo/search/display/display.w3p;query=Id%3A%22library%2Fjrnart%2F218794%22 • modernising aspects of electoral administration 42nd Parliament in July 2010. such as publishing forms and information High Court of Australia, Rowe & Anor v Electoral Commissioner & Anor, media release, 6 August 2010, http:// about polling places, evidence of identity for In July 2010 a challenge to the 2006 amendments www.highcourt.gov.au/media/rowe.pdf enrolment and reducing the age of provisional relating to the close of rolls was mounted in the enrolment from 17 to 16 years High Court of Australia. On 6 August 2010 the N Horne, Electoral and Referendum Amendment (Close of Rolls and Other Measures) Bill (No. 2) 2010, • expanding the authorisation requirements Court declared the amendments to be invalid. Bills digest, no. 184, 2009–10, Parliamentary Library, Canberra, 2010, http://www.aph.gov.au/library/pubs/ for how-to-vote cards and broadening the bd/2009-10/10bd184.pdf

Page | 10 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Parliament and public administration reform Page | 11 Australian Public Service reform

Dr Nicholas Horne, Politics and Public Administration Section APS employees numbers 1990-2009 170

160

A number of reform themes are current for the Increased regional focus Australian Public Service (APS). 150

In its agreement with two of the non-aligned d n

independents, Tony Windsor MP and Robert a s

The 2010 blueprint for reform u

Oakeshott MP, the Government has committed to o 140 h

In September 2009 then Prime Minister Kevin a range of governance and public administration T Rudd announced the establishment of an Advisory measures in order to provide a greater emphasis Group to develop a ‘blueprint for reform’ of the on regional policy. 130 APS. These measures include a regional Australia The Group, chaired by head of the Department of cabinet ministry; a dedicated Department of 120 the Prime Minister and Cabinet Terry Moran AO, Regional Australia; a regional Australia coordinating completed its work in March 2010 and proposed a unit within the Department of the Prime Minister number of reforms including: and Cabinet; and an agency to provide advice to 110 the public concerning regional health and aged 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 • restructuring and augmenting the role of the care. Australian Public Service Commission (APSC) Unadjusted Adjusted for coverage changes • reviewing employment arrangements for The efficiency dividend Source: APSC, State of the Service Report 08–09, APSC, Canberra, 2009, p. 2, http://www.apsc.gov.au/stateoftheser- departmental secretaries, and vice/0809/report.pdf • reviewing public service efficiency mechanisms Currently the efficiency dividend, which is such as the efficiency dividend. an annual funding reduction, is imposed on government agencies at the rate of 1.25 per In May 2010 the Prime Minister announced that cent per annum. Prior to the 2010 election the the Government had accepted all of the Advisory Government announced that it would retain the Group’s recommendations. The 2010–11 Budget dividend at this rate if returned to office. provided additional money ($38.7 million) for the APSC to undertake its expanded role including Coalition policies Library publications and key documents implementing half of the blueprint and taking policy responsibility for APS employment conditions and In its pre-election policies the Coalition indicated Australian Labor Party and the Independent Members Oakeshott and Windsor, Agreement, 7 September agreement-making. that, if elected to office, it would not proceed with 2010,http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22library%2Fjrnart%2 the blueprint reform programme, and that it would F218795%22 Shortly before the 2010 federal election the set the efficiency dividend at 1.25 per annum with Government announced that, if it was returned a subsequent increase to 2.0 per cent per annum Advisory Group on Reform of Australian Government Administration, Ahead of the Game: Blueprint for the to office, the APSC would still undertake its from 2012. Reform of Australian Government Administration, Department of the Prime Minister and Cabinet, Canberra, expanded role as planned but would not receive March 2010, http://www.dpmc.gov.au/publications/aga_reform/aga_reform_blueprint/blueprint.cfm the additional funding specified in the Budget. The Coalition also indicated that it would impose a recruitment freeze on the APS for two years to Australian Labor Party, Updated net budget impact of election policies, media releases, 31 July 2010 and The APSC has already commenced its new achieve a reduction of 12 000 positions through 16 August 2010, http://www.alp.org.au/federal-government/news/updated-net-budget-impact-of-election- role; with the return of the Gillard Government, it natural attrition (first announced in May 2010). policies-(4)/; http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query%3DId%3A%22media%2Fpre remains to be seen how the APSC will pursue the ssrel%2FZCRX6%22 reform agenda without additional funding. APS employee numbers Liberal Party of Australia and the Nationals, The Coalition’s Plan for Real Action for Australia’s Future, Liberal In June 2009 the APS (i.e. staff employed under Party of Australia, Canberra, August 2010, pp. 16, 19, http://parlinfo.aph.gov.au/parlInfo/search/display/display. the Public Service Act 1999) had just over 162 000 w3p;query=Id%3A%22library%2Fpartypol%2F67572%22 employees.

Page | 12 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Parliament and public administration reform Page | 13 Although the national curriculum has been With so many claims and counter-claims School reform endorsed by COAG, there are concerns about its made about funding for government and non- structure and content. Typical of these concerns government schools, the future of school funding Marilyn Harrington, Social Policy Section are those from the NSW Board of Studies. will be a major challenge for the new government. The Board’s recent evaluation asserts that the national curriculum is inferior to the current NSW curriculum, lacks an overarching framework and is School funding in Australia: overcrowded with content. some key facts The Council of Australian Governments (COAG) attainment. While overall Australian students • Young people are required to participate has set the national goal of a 90 per cent Year 12 perform well, students from disadvantaged While the value of literacy and numeracy testing in schooling (or equivalent) to Year 10, and or equivalent completion rate by 2015. This is an backgrounds in Australia do not perform as well is well-accepted, the presentation of that data then undertake full-time education, training underlying element of the school reform agenda as similar students from the best-performing through the My School website has been or employment, or a combination of these that will feature during the 43rd Parliament. countries, such as Finland. controversial. There are concerns about the activities, until age 17. publication of test data without value-added • Australian governments support schooling There are many elements of a student’s school measures and the potential for counter-productive Why invest in school reform? through public funding. In 2007–08, experience that affect educational attainment, ‘league tables’. 79 per cent of total public funding (excluding Access Economics Director, Chris Richardson, but, as a significant body of research has shown, capital funding) was provided to government views education as ‘an under-appreciated driver it is teaching quality that matters most. It is not The use of performance rewards is also debated. schools. Around two-thirds of full-time of our economic prosperity’. Research from the only the ‘quality’ of teachers that is important, Overseas research is either inconclusive about students attend government schools. Grattan Institute shows that for each additional but also the environment in which teachers the benefits of performance rewards or has found • Constitutionally, state and territory year of education, an individual’s annual income work. Hence, as the OECD has observed, the that they do not improve student outcomes. There governments have responsibility for school will increase by 5 to 12 per cent. overall status and labour market competitiveness are concerns that unless adequate safeguards education. In 2007–08, they provided of the teaching profession, including fostering are developed, performance rewards may divide 91.4 per cent of total public funds for Educational attainment is also positively associated teacher development and improving school work teachers and be detrimental to schools that serve government schools. The Commonwealth with social outcomes, notably health and public environments need to be redressed. Reforms also students from disadvantaged backgrounds. provided 8.6 per cent. and civic engagement. Organisation for Economic need to focus on attracting and retaining particular • The Commonwealth Government is the major Co-operation and Development (OECD) research types of teachers, and attracting teachers to work The review of school funding provider of public funds for non-government suggests that the cognitive and socio-emotional in particular schools schools. In 2007–08, it provided 72.1 per cent skills acquired through education play an important The school reform agenda is underpinned by of total public funding for non-government part in raising social outcomes. The school reform agenda the intransigent challenge of school funding. The schools. State and territory governments Government’s Review of Funding for Schooling provided 27.9 per cent. School retention rates in Australia have improved The school reform agenda includes: the national has led all school sectors to demand assurance • Commonwealth funding for schools will only slightly in the last ten years. In 2009, curriculum, national testing of student attainment, and funding equity. increase in real terms from $6.9 billion in the year 10 to 12 retention rate was 76.7 per student and school performance reporting, 1999–00 to an estimated $11.5 billion in cent, compared to 74.4 per cent in 2000. The teaching quality, school and teacher performance The Review is the first comprehensive appraisal 2011–12. An estimated 61.6 per cent of this retention rates for students from disadvantaged rewards and school autonomy. of school funding since the early 1970s. It is funding will be spent on non-government backgrounds, including Indigenous students examining all school funding, public and private, schools and 38.4 per cent on government and students from rural and regional areas, are KPMG Econtech has modelled the Government’s and is due to report in 2011. schools. significantly lower. school reforms. It predicts that if they achieve their targets, they could generate, from 2010 to Literacy and numeracy attainment is a key 2024, economy-wide gains of 0.4 per cent in gross factor in school retention. As students progress domestic product and 0.2 per cent in employment. through school, the percentage meeting national Library publications and key documents benchmarks in some areas declines, particularly There has been a convergence of opinion on for students from disadvantaged backgrounds. In the broad direction of the school reform agenda Department of Education, Employment and Workplace Relations (DEEWR), ‘Review of Funding for Schooling’, some cases, the difference between Indigenous amongst the major political parties. However, there http://www.deewr.gov.au/Schooling/Programs/Pages/FundingReview.aspx and non-Indigenous student attainment varies by is less agreement on how elements of the reforms 20 percentage points or more. should be implemented. There is also debate M Harrington, Commonwealth funding for schools explained, Background note, Parliamentary Library, about the value of some reforms, given the findings Canberra, 2010. (Forthcoming.) The achievement gap between Australia’s of overseas research. high-performing and low-performing students KPMG Econtech, Measuring the impact of the productivity agenda: final report, KPMG, 2010, http://www. is also reflected in international tests of student deewr.gov.au/Ministers/Gillard/Documents/KPMGEcontechReport.pdf

Page | 14 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Reforming social services and institutions Page | 15 in vocationally orientated courses such as nursing However, owing to the split in responsibilities for Meeting the need for higher level skills and business that are also offered at universities. funding the two sectors—the Commonwealth Further expansion is likely with the recent decision funding higher education and the states funding through tertiary education reform to enrol undergraduates in the NSW TAFE system. VET—the funding of student places is a major anomaly. The student demand driven system, due This ‘blurring’ of the sectors is further pronounced to be implemented in universities in 2012 with a Dr Coral Dow and Carol Kempner, Social Policy Section by VET provision through five ‘dual sector’ guarantee that the Commonwealth will fund all universities that evolved from technical colleges; Commonwealth Supported Places (previously Structural reform of the tertiary education sector teaching and learning by 10 per cent from 2010. universities offering diploma courses as bridging HECS places) that universities offer, is not being will be required to meet targets for higher level Universities argue that public funding to higher courses for degrees; universities offering degrees extended to higher level course enrolments in qualification attainment, part of the national push education as a share of GDP should be increased through TAFEs as third party providers; and a TAFEs and other VET institutions. for a more highly qualified population to meet the to the OECD average by 2020 (about 1 per cent number of private providers delivering both VET demands of the modern economy. of GDP compared with 0.58 per cent for Australia and higher education. The higher education funding model of cost in 2009–2010). The gap left by inadequate public sharing between government and individuals funding has been filled by a cross subsidy from The Bradley Review made recommendations (supported by income contingent loans) is The Australian Government aims to have: overseas students who in 2008 provided 15.5 aimed at integration and improved articulation of relatively new to the VET sector. The sector is still per cent of university total revenue. However, the sectors but there are major administrative and highly dependent on government funds which • 40 per cent of 25 to 34 year olds with a there are indications of a downturn in international organisational barriers which prevent this ‘blurring’ account for 75 per cent of its revenue as student degree by 2025 student enrolments and an increase in domestic evolving into an integrated tertiary sector. These fees account for only 4.5 per cent. However, • 20 per cent of higher education enrolments demand. Modelling of demographic trends and barriers include differences in funding, regulatory since 2007, Commonwealth government income from people of low socio-economic status participation rates suggests that the 40 per cent frameworks, governance, curriculum development contingent loans have been made available to (SES) backgrounds by 2020. target of 25 to 34 year olds with a degree could be and staffing. Overcoming these barriers may also those studying at the Diploma level or above reached by 2015 and that an additional 450 000 prove difficult whilst some parts of the higher in state VET systems. Only available for full-fee COAG has set targets to double the number domestic students will be enrolled by 2030. Such education sector wish to preserve universities as courses in the first instance, they were extended of people with diploma and advanced diploma growth will exert pressures on university revenue, the main providers of bachelor education within the to government subsidised students in Victoria qualifications by 2020. infrastructure and staffing to the extent that it is broader framework of teaching and research. to reward that state for its competitive market predicted that more than 20 new universities and reforms. In the 2010–11 Commonwealth Budget 26 000 extra academic staff may be needed over Unlike higher education, VET reform is mainly in they have been offered as a ‘national entitlement to Higher education funding and reforms the next 30 years if it were left to the university the hands of the state and territory governments. a quality training place’ in all states who undertake sector alone. Delivery of higher education through The Howard and Rudd Governments, in their such reforms. As tapping these private sources of Structural and funding reforms to meet these the vocational education and training (VET) sector own different ways, have supported competitive income offers VET the best prospect for financing targets is partially underway in the higher is therefore considered a viable alternative to market reforms in VET. The Rudd Government more training places, it is likely to prove a powerful education sector through the Rudd Government’s meeting these targets and relieving the pressure also advanced the development of a national VET force for bringing about reform in VET institutions, response to the major review of Australia’s on universities particularly as Technical and Further regulator. These reforms are influencing change in particularly in the state run TAFEs. higher education system chaired by Professor Education (TAFE) campuses are more widely the way that state and territory TAFEs operate in Denise Bradley in 2008. The Rudd Government distributed in outer metropolitan and regional the system. accepted a substantial number of the Review’s locations. This will be important in improving recommendations including deregulating the access and participation rates of regional and allocation of university places through a demand- remote students who remain seriously under Library publications and Key documents driven entitlement system for domestic students represented in higher education. (sometimes referred to as a voucher system); F Beddie and P Curtin (eds), The future of VET: A medley of views, National Centre for Vocational Education changing the indexation rate of university funding; The role of the VET sector Research (NCVER), Adelaide, 2010, http://www.ncver.edu.au/publications/2284.html increasing funding aimed at improving low SES participation; and, establishing a new Tertiary The VET sector has traditionally been regarded Group of Eight, ‘Future demand for higher education in Australia’, Go8 Backgrounder, no. 10, Canberra, June Education Quality and Standards Agency (TEQSA). as the sector of trades and skills training but 2010, http://www.go8.edu.au/storage/go8statements/2010/go8backgrounder10_HE_demand.pdf Further legislation will be required to enable the full there is an overlap between the two sectors in the implementation and funding of the reforms with the delivery of Diploma, Advanced Diploma, Graduate Review of Australian Higher Education, Final report, (Professor Bradley, Chairperson), Department of demand driven system due to commence in 2012. Diploma, and Graduate Certificate courses. Since Education, Employment and Workplace Relations, Canberra, December 2008, http://www.deewr.gov.au/ 2003 the sector has also provided undergraduate HigherEducation/Review/Pages/ReviewofAustralianHigherEducationReport.aspx Adequate funding is an ongoing issue with the education. Initially TAFE institutions, mainly in Rudd Government rejecting a Bradley Review Victoria, offered degrees in disciplines unavailable G Moodie, L Wheelahan, S Billett and A Kelly, Higher education in TAFE: research overviews, NCVER, recommendation to increase the base funding for in universities. However, TAFEs now offer degrees Adelaide, 2009, http://www.ncver.edu.au/publications/2189.html

Page | 16 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Reforming social services and institutions Page | 17 A health care system for the 21st century Flexible workforce E-health The question of what needs to be done to match A growing body of research has highlighted the Rebecca de Boer and Dr Rhonda Jolly, Social Policy Section the size and shape of Australia’s health workforce role e-health may be able to play in delivering a to the changing needs of health consumers has safer, more equitable and more efficient health long been debated and is far from resolved. Any system. E-health cannot be considered a ‘silver new approaches to health care and organisation of bullet’. However, it is expected to achieve the health care system will also require changes to efficiencies by reducing medical errors associated Despite frequent media reports to the contrary, Early intervention, prevention and the health workforce. with lack of access to patient information and Australia has a good health care system. But it integration adverse drug events, as well as time and costs could be better. Politicians, policy makers and the Shortages across the health workforce are the associated with duplicated or unnecessary public are often captured by the health ‘problem of Hospitals remain the primary focus of the health result of complex and multifaceted interactions treatments and tests. While e-health offers great the day’ as presented by its advocates. Recently, debate and receive significant amounts of funding. between demographic, social and clinical factors. potential, it would also need to be approached in mental health and dental care have featured promi- This is despite evidence which suggests that A limitation of the numerous strategies and the context of re-evaluation of the overall system. nently. Not long ago similar attention was directed Australia is over reliant on hospitals and that initiatives has been that solutions have not been Careful scrutiny by the parliament will be required to hospitals. As arguments could be made for there would be benefits if more were spent on multi-dimensional. Strategies have increased the to ensure that technology does indeed deliver what more funding to improve access to services in all preventative care than the mere two per cent of the supply of some workers to the exclusion of others, it promises—better outcomes for patients and these areas, how can the limited budget be prior- health budget currently allocated. favoured one profession over others, or sought health professionals at a cost that the community itised to meet not only the needs of these sectors, to enlist workers in some geographical areas can afford. but to improve health outcomes overall? There have been calls such as those from the or types of care in preference to others without NHHRC for government to adopt a ‘primary consideration of the overall outcome. Future prospects Under current arrangements improvements in health care’ approach when planning the health some of these areas can, and have been made. care system. This concept of primary health care Workforce reform is unlikely to be achieved Changing patterns of disease and improvements However on average, Australians are less healthy involves more than the ‘first point of contact’ with through the tweaking of either supply or demand; in medical and communications technology are than they were ten years ago. The challenge of the health care system or a consultation with a reform involves addressing all aspects of the contributing to the momentum for a new approach how best to address rising health expenditure and general practitioner. It represents a comprehensive system from all perspectives. Integral to the to ensure that the Australian health care system the growing burden of chronic disease persists. model of care that integrates the various health challenge is likely to be the breaking down of long- is responsive to the demands of the 21st century. sectors and emphasises early intervention and standing and entrenched traditional professional Such an approach may well involve major changes Some have argued that decision makers need to prevention. Evidence emerging from some health boundaries. across the entire health care system—from funding engage in visionary thinking that looks beyond care providers in the United States (US) and models, to service delivery, to workforce. A strong addressing individual sectoral needs. Reorienting from Spain suggests that a primary health care A further challenge will be to introduce a concept commitment to prevention and addressing the the health care system towards prevention and approach has been successful in improving health of workforce flexibility which does not tie health social determinants of health would seem to improved integration has been offered as part outcomes and reducing overall expenditure on workers to particular expectations about the underpin such changes. The challenge for policy of the solution to addressing this challenge. health. care they are able, or should deliver, and which makers, parliament and the public would be to A flexible workforce, enabled by technology responds to health needs. This flexibility would accommodate moves away from more traditional including electronic applications (e-health) is also However, for Australia the challenge is that therefore entail continuous re-assessment of skills approaches to health policy to objectively consider increasingly being seen as critical to achieving implementation of such an approach would require mixes across professions and more responsive alternatives that may run counter to vested these objectives. adopting a different attitude to funding, delivery education and training programs. interests. and organisation to that of the current system. It The Rudd Government’s National Health and would also require re-consideration of the role of Hospitals Reform Commission (NHHRC) put governments in the provision and funding of health forward a range of proposals that would go some care, which currently is largely the domain of the way to a more integrated health care system. states. Arguments have been made that a single Despite the Government’s response to the funder for the provision of all health care would NHHRC, there are fears that any opportunity for help to address structural challenges and influence Library publications and key documents significant, structural change may remain elusive, such change. Alternatives such as the concept at least in the short term. of a ‘medical home’ (Kaiser Permanente in the National Health and Hospital Reform Commission (NHHRC), A healthier future for all Australians – final report, US is an example) could also be considered. The NHHRC, 2009, http://www.health.gov.au/internet/nhhrc/publishing.nsf/Content/nhhrc-report medical home is responsible for the continuum of care for its patients, from prevention to acute care. National E-Health and Information Principal Committee, National e-health strategy, Deloitte, 2008, http:// These approaches would however, require moving www.health.gov.au/internet/main/publishing.nsf/Content/604CF066BE48789DCA25751D000C15C7/$File/ beyond the traditional divide between the public/ National%20eHealth%20Strategy%20final.pdf private provision of health care.

Page | 18 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Reforming social services and institutions Page | 19 Physical inactivity is the second most important reflected in the development of two key national Improving the health of all Australians: the role risk factor that contributes to the burden of health strategies. In 2009, Australia’s first National disease, morbidity and mortality in Australia. It is Preventative Health Strategy recommended a of preventative health widely acknowledged that regular physical activity range of measures—some controversial—to provides a large range of health benefits, ranging limit the consumption of alcohol and tobacco from reduction in risk factors for heart disease, and reduce overweight and obesity. Some of Amanda Biggs and Dr Rhonda Jolly, Social Policy Section high blood pressure, high cholesterol, diabetes its key recommendations included: increasing and some cancers. Increased physical activity the tobacco excise, requiring plain packaging of delivers fitness and stamina, increased energy tobacco products, better nutritional information with chronic conditions were better managed and reduction in stress, anxiety and depression. on food labels, and phased bans on junk food through community-based primary care services. Participation in physical activity also helps improve advertising to children and alcohol advertising social and community networks and increases during live sports broadcasts. Although some However, although primary care plays a key role in community cohesion and social connectedness. It recommendations such as increasing the excise managing chronic disease, there is clearly scope leads to safer communities and reduces the sense on tobacco have been implemented, the future for more emphasis on actions that prevent disease of isolation many people experience in modern of others—particularly the more contentious— or slow its development. Early intervention can society. In short, it delivers a better quality of life for remains uncertain. reduce or even eliminate the need for later, more people of all ages. intensive and costly care. Well-known examples of Prevention is a key element of Australia’s National prevention include vaccination, cancer screening Australia has not acted as positively to redress Primary Health Care Strategy, also released last and health promotion. By tackling disease and the this trend towards greater inactivity as some year. Among other recommendations, it called for risk factors of disease early, significant suffering other nations. Some commentators argue that more evidence-based approaches to preventative can be averted, and costs reduced. For example, it sports funding continues to focus on achieving health care, initiatives to target high risk groups has been estimated that tobacco control programs sporting greatness for an elite few at the expense and expanding the scope of the Medicare Benefits in Australia prevented over 400 000 premature of community based initiatives that could improve Schedule to support and fund more preventative deaths and saved over $8.4 billion between 1975 health outcomes for all Australians, regardless of health activities. and 1995. their ability or background. Preventative health, with its longer term An emerging body of research now presents population-based strategies to promote wellness Physical activity and nutrition The World Health Organisation warns that ignoring policy makers with a range of policy options and prevent disease, is often overlooked by both these issues will have dire consequences for to address the burden of chronic disease and policy makers and a public more focused on Australia has long defined itself in terms of health outcomes. A number of challenges will improve the health of all Australians. One way personalised primary care and hospital services. sporting achievements, and flowing from that is need to be addressed. These could include finding forward might be to explore a multi-sector This is reflected in the level of expenditure on a vision of a strong, healthy and athletic nation. and initiating more suitable and equitable funding approach, similar to the Health in all Policies preventative health activities in Australia—just The reality is different. The majority of Australian equations for elite and grass roots sports and agenda currently being implemented in South 2 per cent of total health expenditure. Yet, men and women are either overweight or obese activity programs. Other challenges include finding Australia. This approach recognises that health approximately 32 per cent of Australia’s total and 23 per cent of children aged between five the right formula to work with state, territory and outcomes can be influenced by measures that are burden of disease can be attributed to modifiable and 17 are considered overweight or obese. local governments to improve frameworks that often managed by government sectors other than risk factors that include smoking, alcohol abuse, Young Australians in particular are ignoring advice promote activity, such as urban planning and health. By addressing health across a number physical inactivity, high blood pressure and about nutrition, smoking and alcohol and they are transport infrastructure. of policy sectors like agriculture, education, the blood cholesterol, low consumption of fruits and increasingly inactive. environment, fiscal areas, housing and transport, vegetables and overweight and obesity. It is now Policy strategies it might be possible to improve population health widely recognised that in order to stem the growth Diet and nutrition play a major role in maintaining and reduce the growing economic burden of of chronic diseases, the major risk factors that health and preventing chronic illness. It is This growing recognition of the role of prevention chronic disease. contribute to them must be addressed. estimated that inadequate fruit and vegetable in reducing the risk factors for chronic disease is consumption is responsible for 2.1 per cent of Library publications and key documents Chronic disease the total burden of disease in Australia. Just 9 per cent of the adult population consumes the Preventative Health Taskforce, Australia: the healthiest country by 2020: National Preventative Health Successive reports continue to warn of the recommended 5 serves of vegetables per day. Strategy—roadmap for action, Canberra, Australian Government, 2009, http://www.health.gov.au/internet/ growth in preventable chronic diseases, the cost Although 22 per cent of younger children meet the preventativehealth/publishing.nsf/Content/national-preventative-health-strategy-1lp to the health system and the increasing burden recommended vegetable consumption guidelines, on individuals—which is set to increase as the only 5 per cent of 14–16 year olds meet the Department of Health and Ageing (DoHA), Primary health care reform in Australia: report to support Australia’s population ages. It is estimated that some 431 000 recommendations. first National Primary Health Care Strategy, DoHA, Canberra, 2009, http://www.yourhealth.gov.au/internet/ hospitalisations a year might be avoided if patients yourhealth/publishing.nsf/content/nphc-draftreportsupp-toc

Page | 20 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Reforming social services and institutions Page | 21 Funding through the CSTDA/NDA has been an culpable behaviour Funding support for people with disability area of dispute in recent years, with the states and • a lifetime approach to care, rather than simply territories and many in the disability sector claiming at times of crisis Dr Luke Buckmaster and Michael Klapdor, Social Policy Section that funding provided by the Commonwealth is • active case management inadequate. • universal (non means tested) access • funding possibly drawn from a special The Commonwealth, in partnership with the states supplement to the Medicare levy, private health and territories, is currently developing a National insurance, third party car insurance and/or In recent years, there have been increasing calls Disability Strategy (NDS). The purpose of the NDS workplace insurance in Australia for the introduction of a new, national, • 1.2 million people in Australia with a severe or will be to guide the development of disability policy • national standards of assessment, care, long-term mechanism for funding support profound limitation in 2003 across the jurisdictions. support and case management. for people with disability—national disability • Estimated at 2.3 million by 2030 insurance. Such calls have been made by a range • 64 per cent of those with severe or profound Following recommendations by the Disability Some expected benefits of national disability of groups and individuals, from unions, disability limitations received income support Investment Group, the Rudd-Gillard Government insurance are likely to be improved health and advocacy groups, and medical associations, to • Ageing population will produce an increased directed the Productivity Commission to employment outcomes as a result of an increased carers’ representatives and people living with demand on services and welfare as well as a investigate the feasibility of new approaches. focus on early intervention and more private disability or in a caring role. shortage of carers These included investigating a social insurance investment opportunities in an expanded disability • AIHW estimated unmet demand for model, for funding and delivering long-term services sector. Reduced expenditure on income Those arguing for a new approach have 23 800 people under the age of 65 for disability care and support for people with severe support and medical care would be expected to suggested there are a number of significant accommodation and respite, 3700 people or profound disabilities however they are acquired. offset some of the cost of the scheme. If adopted, problems with the current system. These include: for community access and 1700 people for The Commission will report to the Government in such a scheme would be about more than disability employment services July 2011. ensuring a funding base for disability services into • the fragmented and complex nature of the • Cost $5.2 billion to meet unmet demand the future. It could enable the development of a current disability services system Therefore, the Parliament may be required to more long-term, integrated and planned approach • continuing failure of funded services to meet consider one or more proposals for the design of a to disability services than is possible under current system are funded from general revenue, rather demand new approach to funding support for the disabled. arrangements. than through a dedicated fund or insurance pool. • the lack of an entitlement to disability care and support services based on need, equivalent to Key features of the scheme proposed by The introduction of a national disability insurance The Commonwealth provides income support the entitlement provisions present in Australia’s advocates of national disability insurance scheme would be a major reform. As with Paid primarily through the Disability Support Pension social security and universal health care are:eligibility for those born with a disability or Parental Leave, Australia’s most recent major (DSP) for those affected by disability. Until systems who acquire a permanent disability through social policy reform, there is likely to be significant recently, the provision and funding of disability • differential treatment between those who an accident, injury or as a result of a medical debate about the design of any proposed disability services by the Commonwealth, State and acquire a disability through a workplace or condition, including mental illness scheme. Key questions are likely to include what Territory Governments was dealt with under motor vehicle accident and those who acquire will it cost, how will it be funded, who will be the Commonwealth State Territory Disability permanent disabilities in other ways (including • a ‘no fault’ model: provision of support and eligible (or, perhaps more importantly, ineligible), Agreement (CSTDA). Under the Council of at birth)—that is, while the former generally care for people with disabilities would be and how the scheme would interact with existing Australian Governments (COAG) reforms receive financial support, there is no automatic separated from legal action for negligence/ supports and services (including DSP, Medicare). to Commonwealth-state financial relations, support for the latter announced in March 2008, the CSTDA was • projections of a significant increase in the replaced with the National Disability Agreement number of people with a severe or profound (NDA). In the new agreement the areas of disability—according to the Australian Institute responsibility remain essentially the same. of Health and Welfare, around 2.3 million Australians will have a high level of disability by Under the NDA, open and supported employment 2030 services, as well as targeted employment support • a likely shortfall in the numbers of people services, are administered by the Commonwealth Library publications and key documents available to undertake caring responsibilities. Government. State and territory governments Disability Investment Group, The Way Forward - A New Disability Policy Framework for Australia, Department administer accommodation support, community The current Australian disability support system of Families, Housing, Community Services and Indigenous Affairs, November 2009, http://www.fahcsia.gov.au/ support and community access services for separates the provision of income support from sa/disability/pubs/policy/way_forward/Pages/default.aspx people with disability, along with respite care the provision of services. Both the income support services that provide relief and support to families and services component of the disability support Productivity Commission, Disability care and support, Productivity Commission Issues Paper, 17 May 2010, or carers of people with disability. viewed 2 September 2010, http://www.pc.gov.au/projects/inquiry/disability-support/issues

Page | 22 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Reforming social services and institutions Page | 23 • provided a temporary increase in the First problem is complex and multifaceted. Not only The challenge of housing the nation Home Owner’s Grant to stimulate housing does it involve monetary policy, but also planning construction, and and taxation issues as well as questions about Dr Matthew Thomas, Social Policy Section and Peter Hicks, Economics Section • established a Council of Australian the appropriate size, density and distribution of Governments (COAG) process to clear housing. infrastructure planning and provisions obstructions. Where to next? Australia’s significant housing problem • restrictions on the supply of available land for Improving the housing outcomes of Australia’s low The current situation and future housing prospects income households in the short to medium term, Housing supply in Australia has not kept up with • state and territory as well as local planning and may require the introduction of further reforms to underlying demand—that is, the need for new approvals processes The progress and success of the above reforms improve the fairness of housing policy. housing stock as a result of population growth and • lack of coordination between infrastructure have been assessed by the NHSC which trends in household formation. This has resulted in planning and housing supply, and is independent of government, and by the The Henry Review of Australia’s tax and transfer an estimated shortfall of almost • skills shortages in the housing construction COAG Reform Council which is independent system noted the stimulatory effect on housing 180 000 dwellings as at June 2009 and industry. of individual governments. The NHSC currently demand of the current highly favourable treatment contributed to significant levels of housing stress, expects Australia’s housing shortfall to increase of owner-occupied housing. It recommended a especially among low income households. In More recently, the global financial crisis GF( C) has considerably. Assuming medium growth in both number of changes aimed at making housing 2007–08 over 300 000 lower income home buyers resulted in changed lending practices and reduced supply and demand, the accumulated deficit could more affordable and better matching supply and and 445 000 lower income households renting the availability of credit for multi-unit development. reach 308 000 dwellings by 2014 and 640 000 demand. These include: privately were in housing stress. This is particularly significant given that over dwellings by 2029. two-thirds of dwelling supply in the capital cities • removing stamp duties Many households have been effectively excluded between 2009–10 and 2018–19 is expected to The housing supply problem has had a major • streamlining land taxation so as to remove from all but the lower end of the private housing be through infill development and nearly all infill adverse impact on the affordability of housing for disincentives to property investment rental market and are spending ever-increasing activity is likely to be multi-unit development. low income households. In 2008–09: • moving to a more neutral tax treatment proportions of their limited income on housing. of negative gearing and capital gains on While they may receive some support through Recent reforms • almost half of the low-income households investment in residential property government provided rent assistance (RA), this renting privately were in rental stress • reviewing infrastructure charges to remove assistance has not kept pace with rental prices in The Rudd-Gillard Government implemented • only three per cent of dwellings were affordable impediments to housing development activity, many parts of Australia. several measures calculated to tackle the on-going to low-income households (negligible for and housing supply crisis in Australia. These reforms low-income Indigenous households), and • refining RA and increasing its maximum rate For those low income households most in need, go beyond traditional forms of government housing • of all low-income households with a mortgage, to ensure that renters are able to afford an the federal, state and territory governments assistance such as home purchase assistance, the almost half were in mortgage stress. adequate standard of dwelling. provide public housing. However, a reduction in provision of public housing and RA. They also seek the size of the public housing stock has reduced to enhance the effectiveness of the mainstream Australia’s housing supply and affordability While the institution of any or all of these proposed the ability of governments to provide affordable housing market for both renters and buyers. problems have long-term causes and are unlikely reforms may assist in increasing Australia’s housing to these households. Waiting lists for to be resolved quickly. It may be years before supply of housing, and thus benefit low income public housing are high and increasing, and the Among other things, the Government: many of the above-mentioned measures yield households individually and collectively, they housing affordability problem has contributed to significant results, and this will only be the case if present other economic and administrative sustained high levels of homelessness in Australia. • introduced a National Rental Affordability current levels of investment—both government and challenges for all governments. Current National Housing Supply Council (NHSC) Scheme private—are increased. In addition, the housing projections indicate that the gap between supply • established an Office for Housing and the and demand will continue to increase, thus NHSC exacerbating the housing affordability problem. • provided for up to 19 300 new social housing Library publications and key documents dwellings and repairs and refurbishments of The supply problem over 60 000 existing social housing dwellings National Housing Supply Council, 2nd State of Supply Report 2010, Commonwealth of Australia, through the Social Housing Initiative Canberra, 2010, http://www.fahcsia.gov.au/sa/housing/pubs/housing/national_housing_supply/Pages/ The accumulated housing supply shortfall is due to • introduced the A Place to Call Home initiative default.aspx a number of factors, some of which are of a long- which aims to provide 730 new dwellings for term nature. These include: the homeless Australia’s Future Tax System Review, Australia’s future tax system: report to the Treasurer: part two – • supported the Residential Mortgage-Backed detailed analysis, Commonwealth of Australia, Canberra, 2010, http://taxreview.treasury.gov.au/Content/ Securities Market during the GFC Content.aspx?doc=html/home.htm

Page | 24 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Reforming social services and institutions Page | 25 participation—may not always be complementary. Tackling ‘corrosive’ welfare For example, it could be that income New Income Management management simply helps individuals to manage • commenced July 2010 Dr Luke Buckmaster and Michael Klapdor, Social Policy Section their livelihoods as ‘passive’ welfare recipients • will affect 20 000 people in the Northern better. Addressing both objectives will most likely Territory including disengaged youth and require reforms to welfare payment delivery to long-term welfare recipients be coordinated with other policies addressing • to cost $350 million over four years plus $53 disadvantage, employment participation and million for support services. opportunity, as well as access to services; that Can reforms to the way welfare is The Labor Party’s election commitment to require is, policies aimed at the non-behavioural factors delivered change individual behaviour in a children of income support recipients to undergo affecting the lives of ‘at-risk’ welfare recipients. Cape York project meaningful way? health checks before their parents can receive an end of year Family Tax Benefit A supplement. • welfare reform trial in four communities Both Labor and the Coalition have expressed While Australia’s income support system is • welfare recipients are referred to a Family commitment to addressing long-term welfare primarily aimed at alleviating disadvantage, a The stated purpose of these measures is to Responsibilities Commission (FRC) for dependency, and for this to be achieved through number of recent welfare reforms have focused address the health and welfare needs of children anti-social behaviour, criminal activity or if greater government control over the spending of on the potential role welfare has in sustaining living in families dependent on income support. their children fail to attend school income support recipients. The push for income or even causing disadvantage. This reflects an A further purpose is to encourage people to • FRC can impose income management management to become a mainstream approach emerging policy consensus on the need for move from ‘passive welfare’ to participation in and compel individuals to attend support to welfare delivery, and for further reforms to the governments to address the negative effects of employment and/or education. services. social security system in terms of conditionality, welfare dependency, including engaging in active raise a number of questions for the new interventions in the lives of welfare recipients. Australia is not alone in implementing behavioural parliament to address: WA pilot conditions for welfare recipients. A number Concern that welfare has a ‘corrosive’ or of states in the United States and developing • child protection/income management trial in • What evidence will be required to evaluate ‘corrupting’ influence on its recipients has been countries in Central America have introduced Perth and the Kimberley whether the new approach to welfare has a feature of welfare policy debates throughout systems to encourage certain kinds of behaviour, • more than 200 hundred families have been a success? Australia’s history. This concern has contributed including child immunisations and increased volunteered for income management • What, if any, limits ought there to be on the to a policy focus on targeted income support school enrolments. The Australian approach differs • more than 60 families placed on income nature and extent of interventions in the lives payments to those most in need. Recent debate markedly in the extent to which intervention occurs management as a result of a referral from of welfare recipients? has shifted from participation requirements and in welfare recipients’ lives. state child protection. authorities. • To what extent can these reforms deliver the means tested conditions of entitlement. It now enduring changes to the behaviour of centres on the living conditions of those being Few dispute that the lives of many families individuals and to the lives of those in targeted and whether the behaviour of welfare dependent on income support could be improved disadvantaged communities in Australia? recipients is contributing to their disadvantage. by ensuring income is allocated towards necessities and spending on alcohol, drugs Recent reforms and proposals targeting the and gambling reduced. However, critics have personal behaviour of welfare recipients include: highlighted a range of concerns with recent policy in this area. Evidence as to the effectiveness of • Income management (or ‘welfare quarantining’), these policies is limited, administrative costs are Library publications and key documents under which a portion of a recipient’s payments high and a question persists as to whether it is L Buckmaster, J Gardiner-Garden, M Thomas and D Spooner, Social Security and Other Legislation is set aside for ‘priority needs’, such as food, possible to encourage people to take responsibility Amendment (Welfare Reform and Reinstatement of Racial Discrimination Act) Bill 2009, Bills digest, no. 94, rent and utilities. This measure was introduced for themselves if they do not have control over 2009-10, Parliamentary Library, Canberra, 2009, http://www.aph.gov.au/Library/pubs/bd/2009-10/10bd094. by the Howard Government as part of the important aspects of their lives. Some critics have pdf Northern Territory Emergency Response also argued that targeting personal behaviour by in 2006 and was expanded under the withholding income payments is inconsistent with Australian Institute of Health and Welfare (AIHW), Report on the evaluation of income management in the Rudd-Gillard Government. the rights-based approach to income support that Northern Territory, AIHW, Canberra, 2009, http://www.fahcsia.gov.au/sa/indigenous/pubs/nter_reports/Pages/ • The School Enrolment and Attendance through has been a feature of welfare policy in Australia income_management_evaluation.aspx Welfare Reform Measure, which uses case since World War II. management and the threat of payment Senate Community Affairs Legislation Committee, Report of the inquiry into the Social Security and Other suspension/cancellation to encourage parents A further issue is that the main objectives of this Legislation Amendment (Welfare Reform and Reinstatement of Racial Discrimination Act) Bill 2009 and two to enrol their children in school and take steps more paternalist approach to welfare—ameliorating related Bills, The Senate, Canberra, March 2010, http://aph.gov.au/Senate/committee/clac_ctte/soc_sec_ to ensure attendance. the detrimental effects of welfare and encouraging welfare_reform_racial_discrim_09/index.htm

Page | 26 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Addressing social disadvantage Page | 27 While the working age participation rate is expected Doing away with any design features that create Welfare to work: a reform agenda in progress to rise from 76.2 per cent in 2009–10 to 79.7 per incentives for disadvantaged people to seek to cent by 2049–50, this is insufficient to cancel out qualify for DSP on account of its non-activity Dr Matthew Thomas and Dale Daniels, Social Policy Section the impact of ageing on workforce participation. tested status is one such reform. Another is the Age-related pension expenditures are expected to provision of sufficient support and services to increase as a share of GDP in the years to 2049–50. ensure that people with disabilities and carers are The only other payments for which expenditure is able to function in the workplace. What is required expected to increase are DSP and Carer Payments. in the disability services area generally is continued Hence, if overall working age participation is to and consistent investment and better planned Australia’s population is ageing. At the same In a bid to address these problems, and to be increased, reforms in areas that would help to and integrated service delivery. The introduction time, spending on income support payments as increase workforce participation more generally, increase the participation of people with disabilities of a National Disability Insurance Scheme, as a whole (and not just age pensions) is anticipated the Labor Government introduced further changes. and carers may be required. is currently being considered, may be a means to increase. Without on-going high rates of These included, among other things: reconfiguring to address this problem, as well as meeting the economic growth, the nation will struggle to employment services to better cater to the needs broader needs of people with disabilities and support its ageing population and those who rely of disadvantaged job seekers; increasing the Child carers. on government income support. Care Rebate; introducing paid parental leave; increasing from 2017 the age at which people can Chart 1. Main categories of workforce age income support recipients as a proportion of the workforce age population, Australian governments have long recognised access the Age Pension; and, tightening access 1978 to 2009 the need to increase workforce participation—to to the DSP. Many of these measures have only support economic growth, increase social recently been implemented and their success or 30.00 students participation and reduce welfare expenditure. otherwise has yet to be determined. unemployed lone parents Since the mid 1980s Australia has, along with low workforce attachment 25.00 most other OECD countries, been progressively carers & partnered parents An unfinished agenda veterans introducing active labour market policies. These disabled & sick policies seek to closely integrate labour market Generally speaking, Australia is doing relatively well 20.00 ) % ( programs and income support policies. In in terms of working age employment participation. on doing so, they aim to increase the employment As at 2008 Australia’s participation rate of 76.5 per i r t 15.00 participation and self-reliance of people otherwise cent for people aged 15 to 64 years was the tenth r opo dependent on government income support. highest in the OECD. That said, there is room for P further reform to improve the participation of sole 10.00 Recent reforms parents and those with more moderate levels of disability. 5.00 Arguably, the most significant move in this direction has been the Welfare to Work reforms Incremental reform of income support over the introduced by the Howard Government in 2006. 0.00 last 30 years has been aimed at creating a more These reforms increased the range and number of active system that supports self provision. The people required to look for and accept work and chart below points to the successes and failures Year expanded the support and assistance provided of those efforts: the phasing out of a plethora Sources: ABS (2006), Australian Historical Population Statistics (cat. no. 3105.0.65.001), Table 19. Annual reports and to these typically disadvantaged jobseekers. In of payments for groups with limited workforce statistical publications of the Department of Family, Housing, Community Services and Indigenous Affairs, the Department of particular, the reforms targeted principal carer attachment to restrict income support to those Veterans Affairs, the Department of Education, Employment and Workplace Relations and their predecessors. parents, people with disabilities, mature age job who study, care for others, have disabilities or seekers and the very long-term unemployed. are searching for work; the shifting of groups no longer catered for to the remaining passive The results of the Welfare to Work reforms disability payments; and, the limited impact to have been mixed. While there is evidence that date of repeated efforts to move people with the changes resulted in people from some of Library publications and key documents disability and sole parents to independence the above groups leaving income support for through employment. This mixed picture points Treasury, Australia to 2050: future challenges, Treasury, Canberra, 2010, http://www.treasury.gov.au/igr/ employment (mostly parents), for members of the to the failure of some reforms, the incremental igr2010/ other groups the results were minimal. Indeed, nature of others and the need for further reform in some instances, the reforms may have merely to complete the transition towards a fully active Department of Employment and Workplace Relations (DEWR), Welfare to Work Evaluation Report, encouraged a shift into Disability Support Pension income support system. DEWR, Canberra, 2008, http://www.workplace.gov.au/workplace/Publications/ProgrammeEvaluation/ (DSP), the only remaining non-activity tested WelfaretoWorkEvaluationReport.htm payment.

Page | 28 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Addressing social disadvantage Page | 29 There has been broad agreement on the need to There has been broad agreement on the need to Indigenous affairs: shared goals, elusive recognise past injustices, but does Parliament’s reduce disproportionate Indigenous incarceration National Apology of February 2008 go far enough, rates, but despite many initiatives following outcomes or should there be some formula for monetary the 1991 Report of the Royal Commission into compensation as suggested by most submissions Aboriginal Deaths in Custody, and the more recent to the Senate Standing Committee on Legal 2009 agreement of a National Indigenous Law Dr John Gardiner-Garden, Social Policy Section and Constitutional Affairs Inquiry into the Stolen and Justice Framework, high incarceration rates Generation Compensation Bill 2008? persist. There has been widespread agreement on a effected by the original NTER legislation and to range of goals in Indigenous affairs, but desired modify intervention measures to provide for more There has been broad agreement on the need There has been broad agreement on the need outcomes have been elusive. Do we need different consultation so that they will apply also to non- to reduce welfare dependency and increasing to better define responsibilities. The Howard policies or just better policy delivery? Aboriginals? The reversal and modifications by economic self-sufficiency, but decades of Government sought to clarify these at several the Labor Government did not prevent the United policies under the various banners and programs levels—at an agency level by establishing COAG Issues and questions for the new Nations (UN) Committee on the Elimination of delivered by the Department of Aboriginal Affairs, sponsored whole-of-government trials and Parliament Racial Discrimination, in its 27 August 2010 report, Aboriginal Development Commission, ATSIC an Office of Indigenous Policy Coordination; expressing concern that the NTER continues to and Aboriginal Development Corporation have at the community level by introducing Shared There has long been broad agreement on the need involve discrimination; that RDA ‘special measure’ produced only limited progress toward this Responsibility Agreements and Regional to close the gap in health, housing, education and provisions are being misused; and that there is no goal. Nor it would seem, has the more recent Partnership Agreements; and at the individual employment. This goal has been pursued under entrenched Constitutional protection against racial mainstreaming of programs, the refocusing of level by measures such as making communally different headings—the tripartite agreements and discrimination. funding on regional and remote communities owned homes available for individual purchase and strategies of the Hawke and Keating governments, and the recasting of employment support away converting some CDEP positions into paid jobs. the Howard Government’s ‘practical reconciliation’, There has been broad agreement on the from Community Development Employment However, limited success of these strategies might and the Rudd Government’s Council of Australian desirability of recognising Indigenous Australians in Projects. Should the Commonwealth Parliament suggest a gap between defining responsibilities Governments (COAG) Indigenous Reform Agenda the Constitution and acting in the spirit of the UN see the Queensland ‘wild rivers’ legislation and fulfilling them; and between offering and National Partnerships. However, the socio- Declaration on the Rights of Indigenous Peoples, as constraining opportunities for Indigenous opportunities and seizing them. economic indicators show very little improvement. but such constitutional recognition has not yet economic advancement or appropriately balancing The latest hope for remote housing, the Strategic been achieved. Nor has Parliament’s endorsement environmental and development considerations? In pursuing these goals, would outcomes be Indigenous Housing and Infrastructure Program, of the UN declaration been yet translated into any Would a push towards carbon-trading and stronger if greater weight was put on moving appears to be significantly behind schedule. increased valuing of language (such an important renewable energy offer opportunities to Indigenous some levers, anticipating they will then move part of Indigenous culture), if funding for language communities? others. If so, which should come first, health There has been broad agreement on the need to maintenance and the offering of bilingual education or housing, education or employment, better protect children in Northern Territory Indigenous in Australian schools featuring an Aboriginal There has been broad agreement on the defining rights or better defining responsibilities? communities and for most of the measures language is any measure. desirability of empowering Indigenous people Is it, as the Coordinator General for Remote and introduced as part of the 2007 Northern Territory culturally and economically by recognising Indigenous Services (whose second report is Emergency Response (NTER or ‘the intervention’). There has been broad agreement on the their attachment to land, but the introduction due to be released soon) wrote in his first report However these measures can have draw- desirability of greater Indigenous participation in of a National Native Title Tribunal process and of December 2009 that strong community backs. For example, does income management decision-making. Successive governments have Indigenous Land Fund has not radically changed governance and leadership (as well as strong re-empower those caring for children by slowing supported a National Aboriginal Consultative either the land-tenure map or the welfare- government engagement) are preconditions the flow of cash to alcohol or does it, in part, Committee, a National Aboriginal Conference, an dependency landscape. Concerns persist that for effective community-government relations, stigmatise people and fail to address problems Aboriginal and Torres Strait Islander Commission the standards of proof of attachment have been improved service provision and closing the gap underlining community dysfunction? Would (ATSIC) and a National Indigenous Council, but all set too high to expedite claims, and there has not in remote Indigenous communities? Or is it that liberalising permit access to communities increase of these models have fallen short of engendering been a discernable follow up to the Government’s incremental improvement across all fronts is not scrutiny and bring economic opportunities, or a widespread sense of Indigenous participation in 2008 discussion paper, Optimising Benefits from only the best that can be expected, but that which increase the ease with which alcohol can be decision-making. How might the newly envisaged Native Title Agreements. is necessary and will in the end bear fruit? brought in and disempower the community? National Congress of Australia’s First Nations be different? To what degree will there be a sense There has been broad agreement on the that the Congress members represent Indigenous desirability of acting in accord with the Racial Australians, and how broad and deep is the Library publications and key documents Discrimination Act 1975 (RDA) and the International participation in decision-making that the body Convention on the Elimination of all forms of might facilitate likely to be? J Gardiner-Garden and J Simon-Davies, Commonwealth Indigenous-specific expenditure 1968–2010, Racial Discrimination (CERD). However, is it Background note, Parliamentary Library, Canberra, 2010, http://parlinfo/parlInfo/search/display/display.w3p;qu enough to reverse the suspension of the RDA ery%3DId%3A%22library%2Fprspub%2F216438%22

Page | 30 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Addressing social disadvantage Page | 31 The ABS population projections are based on Interpreting the projections Australia’s future population estimated resident population (ERP). The ERP is calculated by adding natural increase (the excess As can be seen above, population projections Dr Luke Buckmaster, Social Policy Section and Joanne Simon-Davies, Statistics and of births over deaths) and net overseas migration vary widely depending on the assumptions used. Mapping Section occurring during the period to the population at the The most widely used current figure, Treasury’s beginning of the period. ‘35.9 million by 2050’ is a middle range projection largely reflecting current demographic trends. The next ABS population projections will be Nevertheless, even the ABS’s low growth (Series How ‘big’ is Australia’s population likely to Population projections released after the 2011 Census of Population and C) projection suggests that the population would become by 2050? Housing and are not expected until 2013. reach 30 million by the middle of the century. Population projections produced by the Australian Recently, the question of whether Australia’s future Bureau of Statistics (ABS) are not predictions Australia’s projected population Population assumptions/projections can change population should be ‘big’, ‘small’ or ‘sustainable’ or forecasts. Rather they illustrate growth and markedly over even a relatively short period of has emerged as a political issue. Discussion of this change in the population based on assumptions As noted, recent debates about Australia’s time (for example, through changes in government issue has been stimulated, in part, by projections about future demographic trends. Broadly, these population have centred on the projection that policy). As a result, caution needs to be used that Australia’s population may reach 35.9 million projections use assumptions about rates of fertility, Australia’s population may reach 35.9 million by when interpreting population projection data. by 2050. mortality and net migration (incorporating current 2050. This figure comes from Treasury’s 2010 For example, the 2004 ABS middle-range trends) and, by using different combinations of Intergenerational Report (IGR) (Australia to 2050: projection was for a population of 28.2 million by However, there has been some confusion in these assumptions, make estimates about the future challenges). 2051—based on assumptions of a immigration rate public debates about the precise status of these population into the future (currently to 2101). of 110 000 and a fertility rate of 1.7. By 2008, the projections—are they based on formal population Under this projection, the population will continue projection had increased to 35.5 million by 2056, targets? How are population projections ABS projections are presented in three series: to grow but annual rates of population growth with an immigration assumption of 180 000 and calculated? Is a population of 35.9 million by 2050 A, B and C. Series B largely reflects current would slow gradually. According to Treasury, fertility rate of 1.8. This change reflected increases inevitable? demographic trends, while Series A and C are the rate of increase will slow from 2.1 per cent in in the level of immigration and the birth rate over based on high and low assumptions for each of 2008–09 to 0.9 per cent in 2049–50. this time. Current policy the key demographic variables respectively. The Treasury projection is also more or less Therefore, a given population projection should Australia does not have a formal population policy ABS Population Projections, Main Projection Series consistent with the figure predicted by the ABS not necessarily be taken as something ‘set in that commits the country to a particular population (35.5 million by 2056) in its middle range (Series stone’. Rather, it should be seen as something target. Assumptions Series A Series B Series C B) projection for 2056. Whilst the ABS creates that can change in a relatively short space of many alternative variations of the projections, time in response to demographic changes In April 2010, the Government established the new Total fertility rate (a) 2.0 1.8 1.6 Treasury used a combination of ABS and its own (which themselves can be influenced by changes office of Minister for Population (later renamed projections in the IGR. in the economy, public policy and the social Net overseas migration 220 000 180 000 140 000 Sustainable Population). The Minister’s main environment). Life expectancy at role will be to develop a sustainable population 93.9 85.0 85.0 According to the ABS, Australia’s estimated strategy through consideration of the likely size birth—male (c) resident population at 30 June 2007 of 21.0 million Life expectancy at 96.1 88.0 88.0 of Australia’s future population and the expected birth—female (c) people is projected to increase to between 30.9 impact on areas such as transport, housing, and 42.5 million people by 2056; and to between Projected population at 42.0 35.5 30.9 infrastructure, employment and the environment. June 30 2056 33.7 and 62.2 million people by 2101. (a) From 2021 The Minister is to be advised by three panels (b) From 2010-11 in A and C. From 2007-08 in B. addressing the areas of demographic change (c) From 2056. and liveability, productivity and prosperity and Source: ABS Population Projections, Australia, 2006 to sustainable development. The three panels have 2101 responsibility for providing advice that will form the Library publications and key documents basis of a public issues paper to be released in late The further the projections move into the future, 2010. the more speculative the assumptions they are Australian Bureau of Statistics (ABS), Population Projections, Australia, 2006 to 2101, cat. no. 3222.0, ABS, based on. There is no certainty that the population Canberra, 4 September 2008, http://www.abs.gov.au/AUSSTATS/[email protected]/DetailsPage/3222.02006%20 projections will or will not be reached. One reason to%202101?OpenDocument for this is that the assumptions cannot include unexpected events, social changes or government Treasury, Australia to 2050: future challenges, Intergenerational Report (IGR) Treasury, Canberra, 2010, http:// policy changes. www.treasury.gov.au/igr/igr2010/report/pdf/IGR_2010.pdf

Page | 32 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Population and infrastructure Page | 33 Over the last decade the planned migration intake Temporary migrants Population growth: what role does increased steadily, with numbers reaching a record Overseas students and business long stay (a) visa grants high of 190 300 in 2008–09, until 2009–10 when immigration play? the planned intake was reduced to 168 700. It has Overseas Temporary business (long stay) Year been kept at this level for 2010–11. students 457 visas Harriet Spinks and Elsa Koleth, Social Policy Section 2000–01 146 577 36 900 Recent changes to the skilled stream of the 2001–02 151 894 33 510 Migration Program have been designed to shift the 2002–03 162 575 36 800 Immigration and population growth The migration program balance of the program away from ‘supply driven’ 2003–04 171 616 39 500 independent skilled migration towards ‘demand 2004–05 174 786 49 590 In 2009, Australia’s population grew by two Since 1945 Australia has run a managed Migration driven’ outcomes, in the form of employer and 2005–06 190 674 71 150 per cent with Net Overseas Migration (NOM) Program, under which places are allocated each government-sponsored skilled migration. The 2006–07 228 592 87 310 accounting for 64 per cent of this growth and year for people wanting to migrate permanently intention is to enable the program to better target 2007–08 278 180 110 570 natural increase (births minus deaths) contributing to Australia. The Migration Program comprises the skills needed in the economy and ensure that 2008–09 320 368 101 280 36 per cent. Migration flows are therefore a key a skilled stream, a family stream and a special skilled migrants are employed in industries that (a) Visa subclass 457. factor contributing to population growth. eligibility category covering former residents who have the highest need. had not acquired Australian citizenship and who Source: J Philips and M Klapdor, op cit. Given the significant growth in NOM in the seek to return to Australia as permanent residents. Temporary migration last few years, it is not surprising that recent Humanitarian entrants (approximately 13 000 The Rudd Government introduced a number of debate in Australia on the issue of sustainable annually) are not counted under the Migration Temporary migration, which is not subject to reforms to the skilled migration program. These population levels has focused largely on the role of Program. annual caps, has in recent times been driven reforms attempt to manage the links that have immigration in contributing to population growth. largely by demand for labour and education evolved between temporary and permanent However, in considering this issue it is important The Migration Program has evolved over the services. Temporary skilled migration increased migration so as to ensure that they operate to to understand what actually comprises ‘migration’ years from a focus on attracting migrants for the markedly between 2004 and 2008 as employers serve Australia’s skills needs and contribute in the NOM data. NOM is the addition (or loss) to purpose of increasing Australia’s population to sought to fill skills shortages, but began to decline positively to the Australian economy. Substantial the resident population arising from the difference a focus on attracting skilled migrants in order in 2008 in response to prevailing economic reforms to the skilled migration program were between those leaving Australia and those to meet the labour needs of the economy. As constraints. The number of overseas students announced in February 2010, following a period arriving, either permanently or on a long-term a result, Migration Program planning numbers coming to Australia has also increased dramatically of unprecedented growth in overseas students basis (in the county 12 months or more over a 16 have fluctuated according to the priorities of the in the past five to ten years, making international in the vocational education sector concentrated month period). This includes long-term temporary government of the day. education one of Australia’s most profitable in a small number of trades such as cooking and entrants such as overseas students, New Zealand exports. hairdressing. The reforms made priority access citizens, and Australian permanent residents to permanent migration contingent upon the Migration Program outcomes since 2000 or citizens returning home after an extended Close connections have evolved between achievement of concrete employment outcomes. absence. Migration Program permanent and temporary migration as temporary Special Year Family Skill Total migrants have increasingly sought to apply for There is no doubt that migration flows are Eligibility The largest contribution to NOM in recent years permanent settlement in Australia. By 2007–08 significant drivers of population growth in Australia. has not been permanent migrants, but people 2000–01 33 470 44 730 2 420 80 610 up to 40 per cent of visas in the permanent skilled Managing migration in accordance with Australia’s 2001–02 38 090 53 520 1 480 93 080 entering Australia on long-term temporary visas, in migration program were granted to people who population challenges and economic objectives 2002–03 40 790 66 050 1 230 108 070 particular overseas students and temporary skilled 2003–04 42 230 71 240 890 114 360 initially came to Australia as temporary migrants, will inevitably be a priority for the new parliament. migrants. Unlike the permanent Migration Program, 2004–05 41 740 77 880 450 120 060 largely Subclass 457 visa holders and overseas temporary migration is not subject to planning 2005–06 45 290 97 340 310 142 930 students. levels or caps set by government. Governments 2006–07 50 080 97 920 200 148 200 also have no control over the numbers of 2007–08 49 870 108 540 220 158 630 2008–09 56 366 114 777 175 171 318 Library publications and key documents Australian citizens and permanent residents 2009–10 (a) 60 300 108 100 300 168 700 leaving or returning to Australia. Similarly, New 2010–11 (a) 54 550 113 850 300 168 700 H Spinks, Australia’s Migration Program, Background note, Parliamentary Library, Canberra, 2010 Zealand citizens enjoy free movement under the (a) Planned. (forthcoming). Trans Tasman Travel Arrangement. It is therefore important that the degree to which the government Source: J Philips and M Klapdor, Migration to Australia J Philips and M Klapdor, Migration to Australia since federation: a guide to the statistics, Background note, since federation: a guide to the statistics, Background is able to directly impact NOM, through its planned note, Parliamentary Library, Canberra, 2010. Parliamentary Library, Canberra, 2010. http://www.aph.gov.au/library/pubs/bn/sp/migrationPopulation.pdf Migration Program, is not overstated. E Koleth, Overseas students: immigration policy changes 1997–May 2010, Background note, Parliamentary Library, Canberra, 2010, http://www.aph.gov.au/Library/pubs/BN/sp/OverseasStudents.pdf

Page | 34 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Population and infrastructure Page | 35 incentive to upgrade or extend existing facilities. competition in the sector. Under such an approach Challenges of an ageing population the Commonwealth’s role would be limited to the To address this issue, some stakeholders have assessment for aged care places, ensuring quality Rebecca de Boer, Social Policy Section advocated that the costs associated with aged and safety of care, and financial protection for care should be separated so that the aged care consumers. resident would pay for the cost of accommodation (like rent) and the Government would subsidise Aged care workforce the cost of care. Another proposal to address the Long-term calls for structural reform of aged care Population projectionsPopulation p2007rojections to 2057 2007 to 2057 financial needs of the sector is for aged care bonds The aged care workforce is ageing and there is may need to be heeded as the population ages. to be applied to all people entering residential aged considerable concern among policy makers and 9 care. Aged care bonds appear to have gained service providers about retaining existing staff and 8 Population projections for Australia suggest that widespread support from aged care providers, if attracting new staff to the sector. Informal carers 7 there will be four million people aged between introduced equitably and fairly. They see them as (mainly family members) also play a significant 65–84 years by 2022 with rapid acceleration of 6 a means of providing a revenue steam to support role in the provision of aged care. However, due to n some age groups (over 65, over 85) in the next 5 capital infrastructure and enhance the quality population ageing, demand is expected to outstrip illio 4

ten years. Support and care for older Australians M of care. However, they have attracted vigorous supply in the next 30 years. Irrespective of where is currently either provided through the residential 3 opposition in the past. or by whom aged care is provided, Australia is aged care sector or by community based service 2 facing a serious workforce shortage. Aged care providers in the home. 1 The residential aged care sector is more heavily workers are some of the lowest paid in Australia 0 subsidised than the community care sector. and there is often insufficient support for informal The Productivity Commission (PC) has 2007 2017 2027 2037 2047 2057 However, on average, care provided in the carers. The question of appropriate remuneration commenced an inquiry to investigate the options People aged 65 and over People aged 85 and over community is less costly to government. There of the aged care workforce remains unresolved, for structural reform of the aged care system to have therefore been calls to redress this imbalance despite various campaigns. Flexible models of Source: ABS, Population projections, Australia, 2006 to meet the challenges facing the coming decades. and provide greater financial support to those who care could also be explored to ensure that older 2101, Cat. No. 3222.0, released 4 September 2008. Series B (mid-level assumptions for fertility, net overseas migration wish to remain in their homes. Australians receive appropriate, high-level care Community based care and life expectancy). in a variety of settings. This may well involve the Regulation and planning examination of the skills and qualifications required Many older people wish to remain in their homes healthy and active members of their community by aged care workers and the breaking down of and supported in the community for as long and consequently has reduced the need for The aged care sector is one of the most highly some traditional barriers between medical and as they are able. There are some government residential aged care. regulated in Australia. There is little dispute over community based care. programs in place (such as Community Aged Care the need for regulations that protect residents. Packages) to support this, but there are gaps in Financing models However, some regulations are considered by the Future prospects availability and service delivery. Also, there has aged care sector to be an unnecessary burden. been criticism that the administrative costs of The Government spends around $10 billion per The Commonwealth regulates all aspects of In December 2010, the PC is due to release a draft some community aged care packages are too annum on the aged care sector, with around two- aged care: determining the planning ratio, setting report, which is likely to generate considerable high, reducing the amount of the subsidy available thirds of this expenditure directed to residential the subsidy, allocating licenses and assessing interest and debate. While the shift in the ageing to fund hours of care. aged care. Older Australians in residential care, older Australians for an aged care place. Many of the population will not be seen for at least who can afford to do so, also make a contribution of these regulations were introduced as a means another ten years, reform is considered by many A trial of consumer directed aged care packages to the cost of their care. There are regulations in of controlling expenditure and managing supply. to be necessary to ensure that older Australians has commenced and it is too early to tell whether place which limit how much aged care providers Numerous commentators and advocacy groups continue to receive high-level care in both this has been successful. Both consumers and the can charge. have proposed that this model be abandoned community and residential aged care settings. community service sector will require significant to allow greater consumer choice and more additional support if these packages are to be Aged care providers have long argued that the implemented more widely. Countries such as subsidy provided by the Government is insufficient Japan have made considerable investments in to meet the cost of providing care and that much their community sector to support elderly people of the aged care sector is operating at a loss. Library publications and key documents to remain in their homes for as long as possible. The absence of any benchmark for the costs Although they have had to adjust their funding associated with providing aged care makes Productivity Commission, Caring for older Australians: Productivity Commission issues paper, PC, arrangements since the program’s introduction, it difficult to assess these claims. Arguments Canberra, 2010, http://www.pc.gov.au/__data/assets/pdf_file/0003/98283/aged-care-issues.pdf this Japanese program has been credited with the have been made that the current financing successful development of the community care arrangements do not encourage investment in Productivity Commission, Trends in aged care services: some implications, PC, Canberra, 2008, sector. It also has enabled older people to remain capital infrastructure and there is insufficient http://www.pc.gov.au/research/commissionresearch/aged-care-trends

Page | 36 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Population and infrastructure Page | 37 Future transport systems… for flying pigs? the mid 1980s. So far, no proposal has proven Building sustainable cities commercially viable without a significant public During the 2010 federal election campaign, the sector funding contribution and/or other forms Matthew James, Science, Technology, Environment and Resources Section Greens, the Australian Labor Party and the Liberal of financial concession such as for lands. The National Party Coalition all announced policy last major report was the 2002 East Coast Very commitments to a feasibility study into an east High Speed Train Scoping Study commissioned coast, very fast train system. As well, plans were by the then Commonwealth Government in advanced for completion of an inland rail route to December 2000, to conduct a comprehensive Balancing the impacts of urban development for buildings development. The Australian Greens serve freight transport. Both systems have been examination of options for a very high speed train an expanding population gives rise to issues of in November 2009 announced a policy for the subject of prolonged previous studies and network connecting Brisbane, Sydney, Canberra energy use, land availability, transport systems and sustainable planning and transport. This includes proposals that have mainly stalled. and Melbourne with major regional centers along infrastructure planning. the establishment of: the way. In 2010, the Cooperative Research Centre The Australian Rail Track Corporation’s July 2010 for Rail Innovation released a study to synthesise Planning infrastructure: an urban myth? • a national report card for development targets report on The Melbourne-Brisbane Inland Rail the current knowledge of High Speed Rail in the and building standards Alignment Study found that an inland route from Australian context and to provide directions for The past year has seen ‘an elephant enter the • a Sustainability Fund, and Victoria, through central and north west New further investigation. room’ of our cities with the sudden increase • national urban planning standards. South Wales, then into Queensland (through the of Commonwealth interest in the planning of Energy use in buildings: how many towns of Albury, Parkes, Narromine, Narrabri, There have been various party policy commitments our major urban metropolitan areas. The Rudd stars? Moree and Toowoomba) has the potential to made to urban light rail transit (LRT) systems, Government established a Major Cities Unit reduce the time it takes to move freight from electric vehicle and ‘green car’ programs, as well (MCU), within the Department of Infrastructure, The Commonwealth has worked with the Melbourne to Brisbane by rail, and to increase as vehicle fuel efficiency and emissions reduction Transport, Regional Development and Local building industry and the states and territories on the capacity of freight rail paths between the strategies. The actual appearance of new LRT and Government portfolio. The Council of Australian sustainable housing to make new and existing two cities. Its economic value remains unclear, alternative vehicle prototypes in Australian cities Governments (COAG) agreed last December that homes more energy-efficient and water-efficient but there is demand for the $4.7 billion railway seem few and far between. by 1 January 2012 all states will have in place plans through new provisions in the Building Code of that would result in a freeing of capacity through that meet defined criteria for the future strategic Australia. These came into effect in all states and Sydney, with a portion of freight continuing to need planning of Australia’s capital cities, and that territories on 1 May 2010. and use the coastal railway. The study suggested Federal Government decisions on infrastructure re-examining the inland rail project from 2015 to funding will be linked to meeting these criteria. COAG signed in April 2009 a Memorandum 2020 to reassess its viability. In May 2010, the Federal Government requested of Understanding for a National Strategy on the Productivity Commission to undertake a Energy Efficiency followed in July 2009 by the The former Very Fast Train proposal and later benchmarking study into Planning, Zoning and National Partnership Agreement on Energy High Speed Train plans for passenger services Development Assessments. Efficiency. COAG agreed that the energy efficiency along the east coast have been well studied since requirement of residential buildings would be Given these federal intentions the Council of increased to a minimum of six stars or equivalent in Capital City Lord Mayors released in May 2010 2010. This included energy efficiency requirements a submission to the Government on the for hot water in new houses and lighting in new development of a national urban policy Towards houses and apartments. a City Strategy aiming to secure the productive, sustainable and livable future of their cities. In There has been some concern expressed at Library publications and key documents December 2009, the Local Government and the rating software systems used to assess star Planning Ministers’ Council endorsed purpose, efficiency levels and the differences between Australian Building Code Board (ABCB), Building Code of Australia, 2 vols, ABCB, Canberra, 2010, https:// issue and system principles in their document actual household energy usage and building www.abcb.gov.au/index.cfm?objectid=959C6DF0-9A12-11DF-A133001143D4D594 National Planning System Principles. These joined energy efficiency. Industry bodies commissioned such declarations as the 2003 National Charter studies into the rating system, finding the software Australian Rail Track Corporation (ARTC), The Melbourne-Brisbane Inland Rail Alignment Study, ARTC, of Integrated Land Use and Transport Planning tools unreliable. However, the Department of Canberra, July 2010, http://www.artc.com.au/Content.aspx?p=175 and the May 2007 Planning Institute of Australia Climate Change and Energy Efficiency released a statement on Integrated Land Use and Transport statement (13 August 2010) disputing this. Infrastructure Australia, State of Australian Cities 2010, Major Cities Unit, Canberra, 2010, http://dpl/ Planning. Books/2010/InfrastructureAust_StateAustCities2010.pdf The issue of the sustainability of energy supply to Meanwhile, under review, is the planning of new our cities and transport systems is discussed in M James, The (Green Car) of the Future, Background note, Parliamentary Library, Canberra, 2009, http://www. developments around airports, where a relaxation the brief on Powering Australia from Renewable aph.gov.au/library/pubs/bn/2009-10/CarOfTheFuture.htm of commonwealth control saw a rise in commercial Resources.

Page | 38 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Population and infrastructure Page | 39 Regional population trends in Australia

Peter Hicks, Economics Section and Guy Woods, Statistics and Mapping Section Table 1. Population growth by state and territory Population (million) Population growth rates (%) Average annual Projected Increase 2004 2009 population population 2004 – 2009 2005 2009 (million) (million) growth 2026 (million) (‘000) Introduction What’s happening where? 2004 – 2009 (%) (a) 6.73 7.19 462.62 0.86 1.64 1.34 8.40 One aspect of the current public discussion about The national and state trends reported in Table 1 Victoria 5.01 5.50 482.44 1.43 2.13 1.85 6.50 sustainable population is spatial distribution. mask considerable variation within state borders. Queensland 3.95 4.47 526.97 2.48 2.44 2.54 6.04 Australia’s larger capital cities are often said to Some insight into local level trends is provided South Australia 1.55 1.63 88.33 0.90 1.32 1.11 1.88 be ‘full’ yet continue to account for the vast bulk in Tables 2 and 3 which identify the ten areas Western Australia 2.00 2.27 271.52 1.93 2.65 2.59 3.00 Tasmania 0.48 0.51 20.74 0.80 0.89 0.85 0.55 of population growth. Leaders of many small experiencing the largest population increases and Northern Territory 0.20 0.23 23.93 2.27 2.21 2.25 0.29 rural and remote communities clamour for new decreases respectively. Of the ten areas recording Australian Capital Territory 0.33 0.35 26.74 1.29 1.83 1.60 0.42 residents. This is in sharp contrast with some the largest increases in population: Australia 20.25 22.16 1903.30 1.44 1.99 1.81 27.24 ‘boom’ regions which have experienced such a (a) ABS series B presented in Population Projections, Australia, 2006 to 2101, cat. no. 3222.0, ABS, Canberra 2008 population surge that local housing stock, services • five are in Victoria and four are in AW , and and infrastructure are under extreme pressure. • their average population in 2009 was 70 000. Table 2. Ten areas with largest population increase 2004–2009 Change 2004–2009 Estimated population Average annual Based on ABS data, this brief provides a snapshot Of the ten areas recording the largest declines in Statistical local area Number June 2009 increase (%) of the current dispersal of Australia’s population population: Melton - East (Vic) 53 349 21 016 10.5 by state and recent state level trends. It also Rockingham (WA) 100 231 19 726 4.5 highlights the diversity of population developments • five are in western New South Wales Ipswich - East (Qld) 63 966 18 910 7.3 in Australia over recent years focusing on those • none had a population loss over the five year Wyndham - North (Vic) 91 910 18 906 4.7 regions experiencing the greatest levels and rates period of more than 800, and Whittlesea - North (Vic) 38 412 18 807 14.4 Swan (WA) 110 051 17 859 3.6 of population change. This analysis shows there is • at June 2009 their populations ranged between Wanneroo - North-West (WA) 51 285 17 754 8.9 not necessarily a correlation between the amount 3000 and 31 000. Casey - Cranbourne (Vic) 78 526 17 731 5.3 by which a particular area’s population changes Wanneroo - North-East (WA) 43 406 17 073 10.5 and the rate at which that change occurs. Other data show that the ten most rapidly growing Hume - Craigieburn (Vic) 65 698 15 747 5.6 areas between 2004 and 2009 recorded average Table 3. Ten areas with largest population decline 2004–2009 Growth and decline around the states annual growth rates of between 85 and 17 per cent. However five of these are in the newer Change 2004–2009 The major recent trends at the state/territory level but relatively small suburbs of the ACT and NT Estimated population Average annual Statistical local area Number are summarised in Table 1. Features include: and none currently exceed 5000 people. Four of June 2009 decrease (%) the other ‘top ten’ fastest expanding regions are Moree Plains (NSW) 14 406 -795 1.1 • growth rates have varied considerably both in south-east Qld with rates between 27 and 17 Bourke (NSW) 3 070 -468 2.8 geographically and over time, and per cent, and two already exceed 15 000 people. Kambah (ACT) 15 883 -441 0.5 • Queensland (Qld) has recorded the largest Onkaparinga - Morphett (SA) 23 558 -440 0.4 Walgett (NSW) 7 209 -402 1.1 population increase with well over half a million For areas with at least 1000 people, the ten fastest Murrindindi - West (Vic) 7 150 -395 1.1 extra people while Western Australia (WA) has dwindling populations are all small communities. Broken Hill (NSW) 19 960 -372 0.4 experienced the fastest growth rate. All except one had less than 2000 people in June Yarra Ranges - Dandenongs (Vic) 30 698 -310 0.2 2009. Four of these were in inland WA north and Lachlan (NSW) 6 872 -307 0.9 Balonne (Qld) 4 847 -292 1.2 In addition, the concentration of Australia’s east of Perth and recorded average annual rates population in the capital cities is currently projected of population decrease of between 3 and 2 per Library publications and key documents to increase from 64 per cent in 2007 to 65 per cent cent. Also in this group are Coober Pedy and the in 2026 and then 68 per cent in 2056. surrounding Far North of South Australia where Australian Bureau of Statistics, 3218.0 - Regional Population Growth, Australia, 2008-09, cat. no. 3218.0, rates of population decrease were about 2.5 ABS, Canberra, 2010, http://www.abs.gov.au/AUSSTATS/[email protected]/Lookup/3218.0Main+Features12008- per cent. Three regions in central and southern 09?OpenDocument Qld declined at just under 2 per cent annually. Nationally, a further eight areas with between 500 Australian Bureau of Statistics, Australian demographic statistics, December quarter 2009, cat. no. 3101.0, and 1000 people experienced average annual ABS, Canberra, 2010, http://www.ausstats.abs.gov.au/Ausstats/subscriber.nsf/0/F61F4E6F3B1770A6CA25774 rates of decline of 1.5 per cent or more. B0016244B/$File/31010_dec%202009.pdf

Page | 40 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Population and infrastructure Page | 41 to produce food and fibre needed for consumption Population and the natural environment Victorian ecological footprint and export. Population growth means growth in agricultural production, a trend that has been Bill McCormick, Science, Technology, Environment and Resources Section ‘The average Victorian resident has an occurring for many years. Such an increase, Ecological Footprint of 6.83 global hectares, whereby more food is produced from less land, is more than three times higher than the world feasible up to a point, but can have major impacts average. This equates to a total Footprint of on the environment if not managed properly. 33 million global hectares, or 147% of the land If practised sustainably, there is the potential Humans affect the environment in a variety of without damaging the natural environment (that is, area of Victoria. However, a part of Victoria’s to reduce, or at least minimise, these impacts. ways, including: the sustainable population or ‘carrying capacity’) Ecological Footprint will be located in other Methods of achieving this include: is not readily possible; it depends on a number of parts of the world to provide the wide range of • through the consumption of energy and variables, including: goods and services consumed by its residents. • changing farming practices, for example, resources The Ecological Footprint consists of both actual improved management of livestock wastes • through the discharge of wastes and pollutants • the lifestyle and level of per capita resource (real) land (arable land, pasture, forests, built or agro-forestry, to reduce greenhouse gas • through the displacement of plants and animals consumption land etc.) and “carbon land” (the land required to emissions and the modification of natural ecosystems by • the location of the population around the absorb the carbon dioxide emitted through the • using improved plant breeds with increased agriculture, and country consumption patterns of a given population)’. water use efficiency and genetically modified • by cities, transport systems and industry. • the quantities of the various pollutants that are crops to reduce pesticide use, and discharged into the air, soil, water and biological • precision agriculture to deliver water, nutrients Ecosystem services systems Different levels of consumption between and pesticides to the crops when and where • the sources and types of food and how and populations will affect the environmental impacts they are needed, thus reducing consumption Natural and modified ecosystems provide humans where they are produced of those populations. Altering consumption and offsite environmental impacts. with: • the location (source) and types of energy patterns to reduce the impact may enable the consumed, and population of a country to increase, without Comments • provisioning services such as water, food, fibre, • the location (source) and types of resources (for putting further pressure on the environment. This biomass fuel, genetic resources example, water, soil, minerals) used to make may mean consuming less, but alternatively, the An increasing population will make it more difficult • regulating services such as climate regulation, products that are consumed. impacts of consumption can be cut by introducing to meet environmental commitments. For example, flood and drought mitigation, water purification, technologies that reduce energy use, waste to reduce Australia’s carbon emissions from pollination, disease and pest regulation and While it is difficult to estimate a specific sustainable products and increase efficiency. year 2000 levels by five per cent by 2020, while control population level there is no question that we need the population is increasing to 27 million, means • cultural services, such as recreation, aesthetic to eventually stabilise Australia’s population. There Intensification of agriculture a reduction in per capita emissions by almost values, and heritage, and are limits in terms of the ability of the environment 20 per cent. Thus, population growth means that • supporting services, such as soil formation, to supply resources and the ability of it to absorb An increasing population requires more food ways must be found to reduce individual footprints. nutrient cycling and primary production. waste products. Some commentators argue that and other primary products. Growth without end we have already exceeded sustainable population means that limits will be eventually reached in Modification of these ecosystems can reduce the levels for Australia. terms of the area of suitable agricultural land able effectiveness and amount of these services. Ecological footprint Sustainable population The term ‘ecological footprint’ is used to assess In June 2010, the Australian Government the impact of individuals, cities or countries on the appointed a Minister for Sustainable Population environment. One definition of ecological footprint Library publications and key documents to develop a sustainable population strategy, is a measure of how much biologically productive ’underpinned by respect for the environment and land and water an individual, population or activity B Foran and F Poldy, Future dilemmas: options to 2050 for Australia’s population, technology, resources and respect for the needs of Australians requiring good requires to produce all the resources it consumes environment, report prepared for the Department of Immigration and Multicultural and Indigenous Affairs, infrastructure and services’. and to absorb the waste it generates using CSIRO, Canberra, 2002, http://www.cse.csiro.au/publications/2002/fulldilemmasreport02-01.pdf prevailing technology and resource management There are calls to set population targets for practices’. Several Australian states and territories T Wiedmann, R Wood, J Barrett, M Lenzen and R Clay, The ecological footprint of consumption in Victoria, Australia. These often relate to the number of have calculated their ecological footprint. report prepared for the Victorian Environment Protection Authority (EPA Victoria) by the Stockholm people that would be the optimal population, Environment Institute at the University of York and the Centre for Integrated Sustainability Analysis at the rather than a sustainable population. Estimating University of Sydney, 2008, http://epanote2.epa.vic.gov.au/EPA/Publications.nsf/2f1c2625731746aa4a256ce90 the number of humans that Australia can support 001cbb5/6a4f318c29647984ca2574710004e3ad/$FILE/ATTAD7EZ/1269.pdf

Page | 42 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Population and infrastructure Page | 43 and maintain competitive outcomes. This market In relation to sectoral reform, the economic Broadband telecommunications structure continues to result in relatively high literature confirms that privatisation and prices, data caps, and annual consumer complaint liberalisation (competition in local services) have Brian Dalzell, Economics Section levels that grow on a yearly basis. improved economic growth, and increased the productivity and efficiency performance of a Telecommunications, growth and country’s telecommunications, relative to those productivity countries which have not undertaken such reforms. Broadband and wireless phone services. This was facilitated While Australia lags international peers in terms of via the selection of Optus Communications as broadband development and telecommunications Future broadband policy considerations Broadband connectivity can be facilitated via a second general telecommunications carrier to prices, the incremental reforms to date (which copper lines (utilising digital subscriber line or DSL compete against the government-owned Telstra, moved the sector away from a Government With a view to maximising outcomes, policy technology), cable, fibre-optic cable, and a range in both fixed-line and digital wireless services. owned fixed-line monopoly structure) have makers may wish to take into account the of wireless technologies which include, but are Vodafone (which merged with Hutchinson to form been a significant factor in the demand for, and evidence-based research in relation to the not limited to, satellite, mobile, wireless local area VHA in 2009) was later licensed to provide digital development of, Australian telecommunications. following areas: government provision of public networks, and wireless fidelity. Broadband is often wireless services in competition against both The growth of telecommunications services more and non-public goods and positive net social referred to as high-speed broadband or high- Telstra and Optus. General telecommunications broadly has been explained by a number of factors return; externalities and government intervention in speed Internet because it usually involves a high competition following the Telecommunications Act such as advancements in telecommunications telecommunications markets; government owned rate of data transmission. The term broadband is 1997 led to entry by a large number of resellers of technology, market liberalisation, and privatisation. fixed-line monopolies; government business not strictly defined however. The OECD indicates internet, fixed-line telephone and mobile telephone Advancement in telecommunications technology entities, competitive neutrality and the crowding that broadband refers to Internet connectivity services. While these resellers have invested in is one of the driving forces of reduced out of private investment; social equity, universal which provides access with download speeds of particular network elements, no new significant communication costs, as well as globalisation and service obligations and cross subsidisation; at least 0.256 Megabits per second (Mbps). By network infrastructure providers have emerged growth of the world’s economy. Technological structural separation, access regimes and contrast, the International Telecommunications since 1997. innovations in telecommunications have been investment incentives; and the benefits of Union (ITU) states that the term broadband does driven by increased competition levels stemming increased infrastructure based competition in the not refer to either a certain speed or a specific The incremental reforms since 1991 have resulted from telecommunications sector reform. Australian telecommunications sector. service. Rather, broadband combines connection in a triopoly network structure that remains highly capacity (bandwidth) and speed. Despite this, concentrated. Telstra continues to dominate fixed- the ITU has produced a recommendation that line network ownership and control of the wireless broadband be considered connectivity with a telecommunications sector is shared by Telstra, transmission capacity faster than 1.5Mbps. Optus and VHA. While there is more competition in fixed-line broadband services (Telstra and Optus Broadband is less developed in Australia than have a total share of retail fixed-line broadband in other developed countries as demonstrated services of 58.4 per cent and 16.4 per cent, for across the range of OECD’s available broadband 2007–08 respectively), most competitors provide measures. For instance, in terms of broadband DSL services that depend on Telstra’s public Library publications and key documents subscriber numbers at December 2009, Australia switched telephone network (PSTN) in order ranked 17th out of 31 OECD countries, with 24.3 to access end users. Put simply, almost every I Martin, ‘The promised land: costs and benefits of the NBN vision’, Telecommunications Journal of Australia, subscribers per 100 inhabitants. The availability of Australian retail customer relies on Telstra’s PSTN vol. 60, no. 2, 2010, http://publications.epress.monash.edu/doi/pdf/10.2104/tja10030 broadband in Australia is not yet widespread and as an input for their fixed-line telephone and it does not offer the level of quality and speeds internet services. JS Gans and SP King, ‘’Big Bang’ telecommunications reform’, The Australian Economic Review, vol. 43, no. 2, available in other developed markets, while 2010, pp. 179-180, http://onlinelibrary.wiley.com/doi/10.1111/j.1467-8462.2010.00591.x/pdf simultaneously subject to high prices and data The Australian Competition and Consumer caps. This is largely due to the historical context of Commission recently indicated that this Organisation for Economic Development and Co-operation (OECD), Broadband growth and policies in OECD Australia’s telecommunications sector. concentrated market structure has resulted in countries, OECD, 2008, http://www.broadbandcommission.org/resources/BB%20GROWTH%20IN%20OECD. muted competition and that the core competitive pdf Historical context impediment is the concentrated ownership of the network infrastructure. In particular, the reforms P Lam and A Shiu, ‘Economic growth, telecommunications development and productivity growth Prior to 1991, the Australian telecommunications since 1991 have resulted in highly concentrated of the telecommunications sector: evidence around the world’, Telecommunications Policy, vol. 34, sector broadly comprised a fixed-line monopoly ownership of network infrastructure in a sector that no. 4, 2010, http://www.sciencedirect.com/science?_ob=MImg&_imagekey=B6VCC-4YBMTGJ-1-1&_ provider. The Telecommunications Act 1991 is subject to high barriers to entry and is heavily cdi=5951&_user=4962121&_pii=S0308596109001311&_origin=search&_coverDate=05%2F31%2F2010&_ allowed for limited network competition in fixed-line dependent on regulatory mechanisms to promote sk=999659995&view=c&wchp=dGLbVlb-zSkzS&md5=d69c5156308fed14cf1ba09d16b7decb&ie=/sdarticle.pdf

Page | 44 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Population and infrastructure Page | 45 On the other hand, there are some scientists, situation is complicated by the lack of immediate The politics and science of climate change qualified in the relevant disciplines, who do not alternatives to hydrocarbon burning as a way of accept the general view put forward by the IPCC providing energy for modern societies, and by Roger Beckmann and Marguerite Tarzia, Science, Technology, Environment and and by many of the world’s scientific academies. the fact that Australia benefits enormously from Resources Section These scientists point out, quite correctly, that its coal exports, as well as using coal for most scientific truth is not decided by majority voting of its electricity generation. Thus, acceptance of and consensus but by the evidence from the real the science is portrayed as acceptance of either world. They may consider the IPCC to be a political reduced energy consumption (which could lead to The last two years have seen increased may report findings that are speculative or not body, or at least subject to political influences. reduced economic growth and individual standard questioning of the science underpinning the yet considered fully reliable by other scientists. They either dispute the evidence, or the means by of living) or of moving away from traditional energy concept of human-induced climate change and of Secondly, the experts themselves may be wrong, which it is acquired, or the interpretation of it, or sources, with all the expense and disruption that its predictions. There has also been an increasing particularly where prediction and extrapolation are even the theories upon which the interpretations could entail. polarisation between camps that broadly accept concerned, as these are inherently less reliable are based. Rational scepticism such as this the science and demand emission reductions than observation and controlled experiments. And is a vital part of science, and it is only further The situation with the science has been compared and drastic action, and those who either reject finally, the media and other organisations releasing work and the passage of time that resolve the to that pertaining to tobacco smoke and lung it all outright, or retain a degree of caution about the findings may themselves not always be fully disagreements. Usually, this takes place without cancer 50 years ago. At that time, the connection the actions to be taken. The validity of climate reliable, regardless of how the public views the the glare of publicity and the political involvement was suspected but proof relied on statistical change science, as with any form of science, experts. that climate science has attracted. investigations and animal models. The battle should always be open to genuine question and continued for many decades before sufficient scrutiny. New evidence, when verified, should be Challenges to the science Outside the realm of healthy scientific skepticism evidence was accumulated. Climate science incorporated into the body of knowledge no matter lie those who prefer to deny evidence and is difficult because global experiments cannot what its implications, and subsequent models and Over the last two years, the peak international rational argument, or who suspect conspiracies. realistically be conducted, but over-reliance on predictions should be revised accordingly. body dealing with climate change science, the The stoush between such ‘denialists’ and the computer models is easily criticised. Intergovernmental Panel on Climate Change mainstream scientific view, conducted via blogs Climate change science is now viewed increasingly (IPCC) has faced further questions over errors and the media, has increased the confusion Despite the recent controversies, the through political lenses, a fact that many in its 2007 report. Furthermore, a series of among the public. In addition, the requirement of overwhelming majority of the science has stood up scientists are likely to be uncomfortable with. emailed exchanges were leaked between climate responsible media to present ‘all’ sides equally, or to independent review and is robust by scientific The intersection of science and politics is rarely change scientists (the so-called Climategate at least to appear to do so, means that science is standards. Internationally, as the IPCC readies straightforward because the two disciplines affair), in which some scientists were accused of seen as just one point of view among many and itself for a new report, it will undergo a series of operate from very different perspectives. inappropriately manipulating data, and of being that the opinions of those opposing the science structural changes to improve its adaptability to the less than open about sharing their data with may receive equal air time even if they may have far fast pace of the science and its own increasingly Australian public’s concerns certain individuals. Despite rigorous inquiries less basis in fact. decentralised governance. following both these events, in which little Surveys suggest that, during 2002-2009, the evidence of serious malfeasance or conspiracies On the other side of the argument, those accepting In August 2010 the Australian Academy of prolonged drought over much of the country, appeared, the public’s trust in scientists appears the science and the urgency of the need for global Science issued its own summary on the state accompanied by summer bush fires and noticeably to have eroded somewhat. The evidence of global action can be portrayed as unnecessarily alarmist, of knowledge, reiterating its confidence in the higher temperatures in many areas, resulted in an warming, however, continues to mount. Despite pessimistic or motivated by an agenda – for fundamental conclusions of the science. increase in public concern about climate change. the increasingly robust science, the cause of the example, against coal mining. Most scientists are Following the breaking of drought over many warming is still disputed by some, while others moderate in their language, but pressure groups affected regions, and the signing of the Kyoto reject some of the modeling and therefore the may push beyond the accepted science. The Protocol in December 2007, the issue of climate predictions that come from them. change has fallen below other matters in the public’s list of priorities. Many scientists, meanwhile, have become Library publications and key documents ‘politicised’ as they feel a responsibility to convince The issue of acceptance of climate change science the world of the seriousness of their findings. Australian Academy of Science, ‘The Science of Climate Change: Questions and Answers’, remains pertinent. Surveys within Australia and Such politicisation does not always sit well with http://www.science.org.au/policy/climatechange.html globally have identified this as a key aspect in the process of scientific inquiry and has led to influencing concern and desire for political action accusations that scientists are becoming activists Climate Change Assessments, Review of the Processes and Procedures of the IPCC, Inter Academy Council, on climate change. It is difficult for those not rather than simple inquirers after truth. This leads http://www.interacademycouncil.net/CMS/Reports/13042.aspx trained in science and steeped in a study of the to further problems, as some scientists may find literature to fully understand the details. While there themselves labeled as partisan or one-sided. Parliamentary Library Climate Change website background note, http://www.aph.gov.au/library/Pubs/ needs to be a degree of trust in the ‘experts’, this ClimateChange/index.htm can be eroded. The media and other organisations

Page | 46 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Environment and energy Page | 47 What’s happening overseas? renewable sources. Individual EU countries Emissions control policies already impose a wide range of environmental Australia’s emissions control policies should be taxes Leslie Nielson, Economics Section assessed against the broad policy approaches • both China and India are dramatically of major trading partners or other developed expanding their renewable energy capacity countries or regions. Some key developments are: (mainly wind and solar) and implementing various energy efficiency measures (such as • while the United States has not enacted building, fuel and appliance energy efficiency Australia’s greenhouse gas emissions Current policy trends comprehensive emissions control legislation standards). In particular, China is retiring older, at the federal level, various groups of US less efficient industrial and power generation The recent trend in Commonwealth emissions Australia’s greenhouse gas emissions have risen and Canadian states/provinces are either plants. Both are implementing emissions control policy has emphasised: steadily between 1991 and 2008. This graph, operating their own emissions trading trading schemes on a regional basis, as is drawn from Australia’s Greenhouse Gas Inventory, schemes, or are preparing to do so. Further, Japan. and • the mandated expansion of the amount of illustrates this trend. the US Environmental Protection Agency • New Zealand has just expanded its emissions electricity generated by renewable means (see has announced that it will directly regulate trading scheme, though it will not include all Australian greenhouse gas emissions, megatonnes, CO e separate brief) 2 greenhouse gas emissions from major emitters economic sectors until 2015. New Zealand’s • the development of emissions offsets, where • the European Union (with some additional emissions reduction target is between 10 and 600 various methods of absorbing carbon dioxide countries) has implemented an emissions 20 per cent compared to 1990 levels, if there are encouraged (such as forestry and soil 500 trading scheme. Plans are underway to expand is a comprehensive global emissions control carbon). A further feature of this approach is that scheme. The EU has also made substantial agreement. 400 the development of internationally tradable progress to sourcing at least 20 percent of its emissions offset credits based on these efforts overall energy needs (including liquid fuels) from 300 • energy efficiency measures, such as the 200 encouragement of lower energy consumption in the building sector Megatonnes 100 • the imposition of fuel emissions standards in the transport sector and emissions standards 0 applying to significant emitters, such as proposed coal fired power stations • the provision of financial incentives to the Targets and emissions pricing private sector to reduce its emissions. These reductions would be ‘purchased’ by the public Both major political parties have agreed that sector Australia should aim to reduce its greenhouse • continued funding of research and development gas emissions by at least 5 per cent, compared activities on the prevention of greenhouse to the level of such emissions in 2000, by 2020. gas emissions (such as carbon capture and The Australian Greens are seeking a reduction storage), and in Australia’s greenhouse gas emissions of • continued participation in international climate Library publications and key documents 40 per cent on 1990 levels by 2020. As the above change negotiations (see separate brief). L Nielson, Emissions control: your policy choices, Background note, Parliamentary Library, 10 May 2010, graph shows, Australia’s emissions levels were http://www.aph.gov.au/library/pubs/BN/eco/EmisisonsControl.pdf slightly higher in 1990, than in 2000. Effectiveness The Climate Institute, ALP pips Coalition on policy but pollution up and credibility down for both, media release, In recognition of the difficulties in legislating a price As helpful as these approaches to emissions 19 August 2010, http://www.climateinstitute.org.au/index.php?option=com_content&view=article&id=721:alp- on emissions, such an approach was deferred until control may seem, they have been widely criticised pips-coalition-on-policy-but-pollution-up-and-credibility-down-for-both-as-power-price-paranoia-paralyses- at least 2012 by the previous Government. The as being inadequate to meet the current targets. policy-progress&catid=39:media-releases&Itemid=36 Australian Greens support placing an interim price Further, they represent perhaps the most costly on greenhouse emissions via an emissions tax, way of reducing, or preventing, such emissions. It Department of Climate Change and Energy Efficiency, National Greenhouse Gas Inventory: accounting for the until an emissions trading scheme is established may be far less expensive for the overall economy KYOTO target, Australian National Greenhouse Accounts, Commonwealth of Australia, May 2010, http://www. (see separate brief). if a price was placed on these emissions via either climatechange.gov.au/~/media/publications/greenhouse-acctg/national-greenhouse-gas-inventory-2008.ashx an emissions trading scheme or an emissions tax, with the private sector being left to find the best ClimateWorks Australia, Low Carbon Growth Plan for Australia, ClimateWorks Australia, March 2010, way to reduce emissions. http://www.climateworksaustralia.com/Low%20Carbon%20Growth%20Plan.pdf

Page | 48 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Environment and energy Page | 49 Crowding out renewable energy on a constant basis. While Renewable energy targets diversity is a desired outcome, it may require a There are a significant number of renewable mandated share of energy to be generated by Leslie Nielson, Economics Section energy projects, mainly wind farms, which are specified means (such as geothermal). being developed. One estimate puts the power that will be generated by these projects at over Transmission lines 1000 mega-watts (MW). In particular the Australian Gaslight Company (AGL) has announced the Australia’s renewable energy resources tend to Current policy Part of the incentive for the installation of development of the Macarthur wind farm with a be in remote locations, far from major centers of commercial-scale renewable energy projects is the capacity of 420 MW. One analyst has suggested electricity demand and major transmission lines. All Under the current Renewable Energy Target (RET) return they may receive from selling the RECs they that all the currently announced renewable energy developers of new power generation facilities must scheme, Australia will be generating at least 20 per give rise to. The expected surplus may depress projects will keep the REC market in rough balance now provide their own transmission lines. Thus cent of its electricity from a variety of renewable the REC price to the extent that some large- for some years to come, even before taking renewable energy generators face an additional sources by 2020 (at least 45 000 gigawatt-hours scale renewable power generation projects may account of the projected surplus of RECs arising cost to develop their projects in comparison to (GWh) in that year). Briefly, large scale electricity be deferred, until the long-term REC price rises. by the end of 2010. conventional power station developers who have users and retailers must purchase the required At present the REC spot price is about $37 per closer access to existing transmission lines. There number of Renewable Energy Certificates (REC) certificate. Though these projects are welcome there are may calls for government assistance by renewable and surrender them to the government regulator some likely consequences: energy developers to help meet this cost. each year. One REC is equal to one mega-watt This deferral of large-scale projects may restrict hour per year. These certificates are created by the the supply of RECs to the extent that there will • the future REC price may be lower than More please generation of electricity from renewable sources. not be enough such certificates created to meet required to provide an incentive for further Failure to surrender enough RECs leads to a the required targets in later years. This may raise renewable energy projects, and Currently, the European Union has a goal substantial financial penalty. the REC price to an unstainable level for current • a low REC price favors already established of sourcing 20 per cent of its total energy scheme participants in the short term. The only technologies, such as wind and solar thermal, requirements (including liquid fuel requirements) From January 2011, the RET scheme will be way these participants can recover this cost is at the expense of developing technologies, from renewable sources by 2020. To meet this separated into two components. The first to substantially raise the retail electricity price such as geothermal and tidal/wave power overall goal at least 33 percent of its electricity will component is the Small-scale Renewable Energy or the price of a large-scale electricity user’s generation. New technologies are expected to be generated by renewable means. Scheme (SRES) covering small-scale generation products. Thus, the REC market requires constant require larger amounts of capital (and hence a and residential based power generation (that is, monitoring. higher REC price) to establish. The Australian Greens have proposed that solar hot water heaters and photo-voltaic panels). Australia’s RET be lifted to 30 per cent by 2020. The second component is the Large-scale The LRET scheme allows for the temporary Technical diversity in renewable energy generation They have also proposed other changes to the Renewable Energy Scheme (LRET), covering increase in its targets if there is a large surplus is important. By their nature solar thermal and RET, such as removing electricity generated by commercial-scale renewable power generation. of REC’s issued at the end of 2010. Parliament wind are intermittent power sources, where waste coal mine gas from the scheme. The set targets for the LRET rise from 10 400 may need to examine the need for government to geothermal and tidal/wave power may provide in 2011 to 41 000 GWh in 2020. The balance of expand the LRET. renewable power generation above this figure will be made up of units installed under the SRES. The graph opposite shows the LRET targets from 2011 Large-scale Renewable Energy Scheme targets 2011–20 to 2020. 45 Surplus Renewable energy targets 40 35 Library publications and key documents The various state and territory feed-in tariff 30

schemes, and the fall in the photo-voltaic system s G Baker, Operating wind farms by Commonwealth Electoral Division, Background note, Parliamentary Library, r u o

costs, have created an effective incentive for h 25 Canberra, 19 February 2010, http://www.aph.gov.au/Library/pubs/bn/stats/Wind%20Farms_CED.pdf

t t the installation of a large number of residential a w 20 a

renewable energy schemes. This has led to a large er S Needham, Renewable energy technologies update, Background note, Parliamentary Library, Canberra, T number of RECs arising from this source alone. 15 30 November 2009, http://www.aph.gov.au/Library/pubs/BN/sci/RenewableEnergy.pdf One estimate suggests a surplus of some 23 10 million RECs by the end of 2010. RECs arising from AGL Energy, $1 billion wind farm in Victoria’s south west to be biggest in southern 5 the SRES may be used to meet the LRET, but not hemisphere, media release, 12 August 2010, http://www.agl.com.au/about/media/ after December 2010. 0 Pages/$1billionwindfarminVictoria%E2%80%99ssouthwesttobebiggestinsouthernhemisphere.aspx 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Page | 50 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Environment and energy Page | 51 These barriers are not impossible to overcome. Getting the mix right Powering Australia from renewable sources Costs are already being driven down by state and Federal policies. The RET, state/territory feed-in With these technologies and robust policies, an Anita Talberg, Science, Technology, Environment and Resources Section tariff schemes, and Commonwealth grants such expanded renewable energy base is possible for as the Solar Flagships Program are examples of Australia. According to Beyond Zero Emissions, existing government support. 100 per cent renewable energy supply is technically possible by 2020 using only proven Feed-in tariff schemes technologies, at a cost of $370 billion over Australia has various natural advantages that The road ahead 10 years. Other supporters call for increases to the can be used to kick-start the transition to energy A pro-rata payment made to individuals or 20 per cent target under the RET. The Australian The wealth of Australia’s renewable energy base security, independent of fossil fuels. companies that feed renewable energy into the Conservation Foundation advocates a target of 25 suggests that it can play a much more important grid. Australia has state-based feed-in tariffs. per cent, the additional five per cent to come from role in powering the country. Hydroelectricity large-scale solar power stations. Some climate Today’s renewable energy mix production decreased 17 per cent in 2007–08 due groups advocate special funding for emerging to the drought, and a lack of suitable sites limits Renewable energy accounts for two per cent of technologies such as geothermal and ocean the growth of hydropower in Australia. However, total Australian energy production, five per cent of To increase support, governments might consider power. Australia has an abundance of geothermal electricity from wind has seen continual growth primary energy and seven per cent of electricity loan guarantee programs such as those offered in energy yet only one plant is in operation (in since 2002, as has solar power (although, as a generation. Most of the electricity generation from the US, tax credits, and co-investment schemes Queensland). More sites are being explored but late-starter the solar sector has not yet reached renewable sources is hydropower (almost five of to reduce the risks for lenders. Management of high capital costs render the sector dependent on the same level of maturity as wind). Bioenergy the total seven per cent). It provides 60 per cent electricity demand, such as through smart grids government support. On ocean power, a recent has the capacity to increase its contribution to of Tasmania’s and 20 per cent of NSW’s electricity and smart meters, can reduce the challenges of study by CSIRO scientists found that about a half Australia’s energy mix by the year 2030, potentially generation. Wind power is the second biggest peak loads. Further, non-intermittent renewable of Australia’s current electricity consumption could by 60 per cent. In addition, technologies such as renewable energy contributor. Together, wind and sources, such as geothermal and bioenergy, are be met by converting just 10 per cent of the near- geothermal and ocean power are currently under hydropower account for more than 90 per cent intrinsically suited to baseload power generation. shore energy along Australia’s southern margin evaluation. For these technologies to come to of Australia’s renewably generated electricity. into electricity (the authors concede that this is an fruition, several technical and economic hurdles South Australia is home to almost 50 per cent ambitious target). will need to be addressed: Solar Flagships Program of Australia’s installed wind power capacity and another 22 per cent is in Victoria. Bioenergy (that A $1.5 billion Commonwealth Government The ‘right’ mix will be a combination consisting of • cost, especially upfront capital costs of is, energy produced from biological sources) grant launched in May 2009 to support the more wind, solar and bioenergy, rather than hydro, renewable energy projects is still a major barrier provides most of Australia’s primary energy deployment of four large-scale solar projects. and room for new industry entrants. A price on to the growth of the industry. Some has been produced from renewable sources. Although A shortlist of eight projects was announced in carbon is likely to favour investment in renewable alleviated by the Renewable Energy Targets Australia is the continent with the highest average May 2010. energy projects and allow the market to ‘pick the (see the Renewable Energy Target brief) but the solar radiation per square metre, solar energy winners’. Without a price on carbon, the renewable industry continues to call for assistance in the accounts for less than two per cent of renewable energy industry needs longevity and certainty in form of upfront subsidies energy production (or 0.1 per cent of total energy government policy to find the right mix. • intermittent supply is often cited as a reason consumption). Finally, long-distance interconnections between why it is difficult for renewable energy sources Australian production of renewable energy (Petajoules) solar or wind power plants and the grid can be to completely replace traditional sources. This realised with high-voltage direct current links, as is Solar-solar is certainly the case for individual wind and electricity proposed between North Africa and Europe. Solar-solar hot water 0.14% 2.24% Wind 4.90% solar plants which rely on unpredictable or time-limited resources, but energy storage (for example, with molten salt) and a varied Library publications and key documents renewable network can go some way towards Australian Bureau of Agricultural and Resource Economics (ABARE), Energy in Australia 2010, ABARE, alleviating the problem of intermittency and Hydroelectricity Canberra, 2010, http://www.abare.gov.au/publications_html/energy/energy_10/energyAUS2010.pdf 14.97% • geographical distances between where the Bioenergy-bagasse renewable energy resources are and where the 38.59% M Wright and P Hearps, Zero carbon Australia stationary energy plan: Australian sustainable energy, Energy demand for energy occurs, pose transmission Research Institute, University of Melbourne, Melbourne, 2010, http://media.beyondzeroemissions.org/ problems. Areas of high solar radiation are ZCA2020_Stationary_Energy_Report_v1.pdf Bioenergy-wood and inland and wind speeds are high along the woodwaste southern and south-western coastal areas, 33.10% Geoscience Australia and Australian Bureau of Agricultural and Resource Economics, Australian energy whereas consumption is concentrated in resource assessment, report prepared for the Department of Resources, Energy and Tourism, Canberra, 2010, Bioenergy-biogas grid-connected areas of the capital cities. and biofuels https://www.ga.gov.au/products/servlet/controller?event=GEOCAT_DETAILS&catno=70142 6%

Page | 52 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Environment and energy Page | 53 address issues such as harvesting and maximising with tree-mimicking devices, and Climate change action: a multi-faceted carbon absorption. The Government’s Second -- adding iron to the ocean to stimulate

Generation Biofuels Research and Development biological growth that absorbs CO2 from the approach Program furthers ‘research, development and air and eventually sinks to the seabed. demonstration of new biofuel technologies • solar radiation management aims to either and feedstocks that address the sustainable reduce the amount of incoming solar radiation, Anita Talberg, Science, Technology, Environment and Resources Section development of a biofuels industry in Australia’. or increase the amount reflected. Some As part of this, the University of Melbourne is proposed methods are: The science on climate change suggests further the construction of up to four commercial scale undertaking a project examining the prospect of -- whitening clouds with tiny salt water droplets reductions in greenhouse gas emissions from the projects. biofuel from algal biomass. to make them more reflective energy sector are needed. Ideally this would occur -- engineering whiter crops or covering deserts by transitioning to a renewable energy economy Biochar to trap carbon in soil Nuclear power with reflective material (see the Brief Powering Australia from renewable -- injecting sulphur dioxide into the sources). However, it could form part of a broader Biochar is a type of charcoal produced from the Because electricity production from nuclear fission stratosphere to reflect sunlight, and portfolio of technologies for acting on climate slow, oxygen-free burning of plants and other produces no greenhouse gas emissions, it is a -- propelling mirrors into space to reflect change. Following are some of the technologies organic material. Creating biochar stores carbon genuine option for reducing climate change. A incoming radiation. and concepts currently being developed. for long periods, delaying its release into the proven technology, it currently provides more atmosphere. Biochar can also add nutrients to soil than five per cent of total global primary energy. These ideas are untested, and could have Carbon capture and storage and improve soil quality. The capacity of biochar to Australia’s extensive supply of uranium adds a dangerous side-effects. Some geoengineering reduce emissions is uncertain as the science is still further advantage. However, if Australia were methods could reduce average rainfall globally, The concept of carbon capture and storage (CCS) new. Some estimate that more than one per cent to proceed down the road of nuclear energy, at delay the recovery of the ozone hole by up to is to reduce greenhouse gas emissions from fossil of global man-made carbon emissions can least 15 years would be required for new plants 70 years, suffocate marine ecosystems, or even fuel-based electricity production by preventing be offset in soils (including through the use of to be constructed and begin operation. Also, cause failure of the Asian and African monsoons carbon gases from entering the atmosphere. As biochar). However, there are limits to the ‘biochar nuclear plants would utilise the existing energy thus threatening the lives of millions. The very long as coal remains the cheapest and most viable solution’: the first is the need for suitable organic infrastructure. However, that would not be concept of geoengineering also poses a series of solution to Australia’s electricity needs, there will matter; the second is the need for significantly conducive to the development of renewable energy complex ethical and legal questions around the be a place for CCS. Given Australia’s reliance on more research. The Rudd Government announced technologies. issues of global management and treatment of coal exports, the development of CCS technology $1.4 million funding to CSIRO for biochar research global commons. And who is to blame if or when is pivotal to the long-term direction of the national in 2009. Soil carbon, and biochar more specifically, Geoengineering the side effects prove disastrous? economy. In 2009, Australia launched the Global was the key feature of the Coalition’s Direct Action CCS Institute and committed $100 million to the Plan on Climate Change and part of the Coalition’s Geoengineering is any large-scale interference in Although these questions seem premature, they initiative, which now has 20 government and 80 election policy, the Plan for Real Action on Energy the climate system to counteract global warming. must be considered throughout any discussions non-government members. The Institute facilitates and Resources. The Labor Party’s approach In some interpretations of this definition, concepts and be integral to the direction of any research. It the development, testing and deployment of to biochar is more cautious. Within its Carbon such as CCS and biochar, and even large-scale is likely that global politics, not science, will be the CCS technologies. The Rudd Government Farming Initiative, Labor seeks to support research afforestation projects, can be included. However, major hurdle for geoengineering. launched the CCS Flagships Program to support and development into biochar and soil carbon. more commonly, geoengineering is used to This is broadly in line with the position of the encompass some of the less conventional ideas Conclusions The carbon capture and storage Greens who support biochar but also urge the use for combating global warming. Under this view, process of sustainable feedstock. geoengineering concepts fit into two categories: There is no ‘silver bullet’ to reduce climate change. The problem requires a commitment to a portfolio There are three stages to CCS: • carbon dioxide reduction techniques aim to of solutions. Biochar, CCS, algal biofuel, nuclear (1) capturing the carbon dioxide either before Algae to turn emissions into biofuels reduce existing concentrations of atmospheric power and geoengineering are just a few of many or after combustion (can be applied to plants Grown in water with adequate light and carbon. Examples include: options. fuelled by biomass, gas and coal, or even to temperature, algae absorb carbon dioxide (CO ) -- chemically ‘extracting’ CO out of the air steel, oil and aluminium refineries) 2 2 and use it to produce compounds that can be (2) compressing and transporting the carbon converted into ethanol or biodiesel. The idea dioxide by road or pipeline, and Library publications and key documents is similar to growing biofuels from land plants, (3) storing the carbon dioxide, generally in but algae are more compact and, in theory, are A Talberg, The Basics of Biochar, Background note, 2009–10, Parliamentary Library, Canberra, 2009, liquid form, about a kilometre underground able to transform more of the absorbed CO http://www.aph.gov.au/Library/pubs/BN/sci/Biochar.pdf (some storage sites are depleted oil and gas 2 into usable product. The concept remains to be fields where the injected carbon dioxide can proven outside the laboratory on a large scale, The Royal Society, Geoengineering the climate: science, governance and uncertainty, The Royal Society, increase production). but technologies are already being developed to London, 2009, http://royalsociety.org/geoengineering-the-climate/

Page | 54 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Environment and energy Page | 55 Establishing an independent National • take into account the ‘whole of the Strengthening the Environment Protection Environment Commission and environment’ in deciding whether to approve an Commissioner action, and Biodiversity and Conservation Act • have sufficient authority to seek information on This recommendation emerged in response to a project alternatives. general dissatisfaction with the confidence in the Juli Tomaras, Law and Bills Digest Section quality and independence in decision making. It Accessibility of information and is envisaged that the Commission would take on transparency of decision-making The Environment Protection Biodiversity and on matters of NES and protecting Australia’s the functions of providing the Government with Conservation Act 1999 (the Act) establishes a legal environment. independent expert advice on project approvals, It was recommended that in the interests of framework to, among other things, provide for strategic assessments, bioregional plans and other transparency and confidence in decision-making, the protection and management of nationally and The Government provided an undertaking that statutory decisions. It may also perform the role the advice from the Act’s statutory advisory bodies internationally important flora, fauna, ecological it would consider the findings of the review, of monitoring, compliance and auditing activities should be made publicly available at the time the communities and heritage places, defined in though declining to commit to a recommended under the Act. Minister makes the relevant decision. This would the Act as ‘matters of national environmental greenhouse gas trigger. However, the improved include: audit reports, expert reports taken into significance’ (NES). The Act lists eight matters position of the Greens in the Senate may temper A more efficient Environmental Impact account by the Minister when making the decision, of NES, whose importance lies in the fact that this stance, and inspire a willingness to be more Assessment Regime and statements of reasons for all decisions made proposed actions, which are likely to have a broadly receptive to amendments designed to by the Minister. ‘significant impact’ on any of the listed matters of effectively deal with greenhouse gas issues. In advancing this goal, the Review committee felt NES, may require assessment and Commonwealth that more strategic policy guidance needed to be Review mechanisms and access to the approval prior to commencement. Similarly acting The Hawke Review recommended an integrated developed to better clarify what may constitute a courts as a trigger, approval is required for any action that reform package revolving around nine core significant impact on a matter of NES. takes place on, or is likely to affect Commonwealth elements. Some of the core elements are A recurrent complaint raised in public submissions land, in terms of having a ‘significant impact on the described below. The issue of access to environmental data and was the limited number of decisions under the environment’. The list of matters of NES may be information and the desire to increase confidence Act that can be the subject of merits review. added to by way of regulation. Modernising and making the Act more in the quality of decisions was also raised in Environmental groups were particularly concerned usable this context. The assessment and approvals that in practical terms, the availability of judicial Review of the Act after ten years of process involves the Minister relying (at least in review was a rather ineffectual tool where the operation The Hawke Review proposed redrafting and part) on information provided by the proponent decision is (allegedly) flawed from a policy, rather restructuring the Act to: and environmental consultants. In view of this, than legal, perspective. However, the report The statutory independent review was undertaken the development of an Industry Code of Conduct recognised that the Act seems to be geared by Dr Allan Hawke, who was supported by a panel • better reflect the Australian Government’s role, was recommended for consultants supplying towards delivering timely threshold decisions as comprising Professor Tim Bonyhady, Professor streamline approvals, and clarify arrangements information for the purposes of the environmental to whether a project triggers the assessment and Mark Burgman, Paul Stein and Rosemary earlier in the planning process impact assessment and approval under the Act. approval process under the Act, and that the Warnock. In addition to examining the operation • make more effective use of strategic application of merits review in such cases may of the Act and the extent to which its objectives assessments, bioregional planning and Strategically widening the Minister’s have a delaying effect. had been achieved, the review assessed the approvals power appropriateness of current matters of NES, as well • remove unnecessary duplication of process, Taking into account both perspectives, a as the effectiveness of the biodiversity and wildlife and This would better enable the Minister to: recommendation was made that merits review conservation arrangements set out in the Act. • simplify language and rename it the Australian should be extended to decisions by the Minister Environment Act. • make decisions in accordance with as to controlled actions and also as to the The final Report of the Independent review of environmentally sustainable development assessment process. Furthermore, legal standing the Environment Protection and Biodiversity New matters of national environmental principles should be extended to include all persons who Conservation Act 1999 (The Hawke Review) significance • be able to consider the impacts on all protected make formal public comment during the decision- was tabled by the Environment Minister on 21 matters affected by the project, notwithstanding making process. Finally, orders for security for December 2009. The Hawke Review made Other proposals were to create a new matter of their significance costs and party-party costs should be limited in 71 primary recommendations, which were NES for ‘ecosystems of national significance’, such public interest proceedings. informed by feedback from professionals and and introducing an interim greenhouse trigger, the broader community. Public comments were with a threshold of at most 500 000 tonnes of Library publications and key documents broadly supportive of the Act and there was carbon dioxide equivalent emissions, which would general agreement that the Commonwealth has cease on commencement of a Carbon Pollution Department of Sustainability, Environment, Water, Population and Communities, Independent review of the a legitimate and central role in regulating impacts Reduction Scheme. Environment Protection and Biodiversity Conservation Act 1999, http://www.environment.gov.au/epbc/review/ publications/final-report.html

Page | 56 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Environment and energy Page | 57 catchments, cuts to diversions in the Murray and Mining and water Murray-Darling Basin water issues Murrumbidgee rivers would have to be 39 per cent and 65 per cent respectively. Farmers in parts of the MDB have raised the Bill McCormick, Science, Technology, Environment and Resources Section issue of the impact of coal mining and coal seam Such potentially large reductions in allocations methane extraction on the quantity and quality have been of great concern for irrigation and of the groundwater resources. Section 255A farming groups. Early this year the National of the Water Act 2007 requires independent Farmers Federation said that, for agriculture, the studies of the impacts of subsidence mining on Over the years there has been an over-allocation the first, third and seventh lowest inflows to Basin Plan was a ‘train smash waiting to happen’. the groundwater systems in the Basin before of water entitlements in many areas of the Murray the Murray River on record. The low flows plus any mining licences are granted. Concerns Darling Basin (MDB). Water resources have continued water use, albeit at reduced levels, Reduction in water diversions remain about the impacts of coal seam methane not been able to meet the water needed for resulted in the Lower Lakes dropping to record production. environmental flows and human requirements. To low levels, exposing acid sulphate soils to the air In the present WRPs, the reduction in water address the problem the Murray-Darling Basin and increasing salinity levels six-fold. The drought allocations that are necessary to meet the new Snowy River flows Ministerial Council introduced a permanent Cap, resulted in a decrease in both area of irrigation and SDLs will be achieved by the Commonwealth starting on 1 July 1997. The Cap is a limit imposed volume of water used. purchasing water entitlements on the water The Snowy Mountains Scheme diverted water on the volume of water which could be diverted market, and through improving water use to the MDB and this reduced the flow of the from the rivers for other uses such as dams or The Basin Plan efficiency. Two programs aim to achieve this: Snowy River above the Mowamba River to just irrigation. one per cent of its normal long-term average. In The Basin Plan, due to begin in 2011, must • the $31 billion Restoring the Balance in the order to reduce the environmental impacts on In 2007 the Commonwealth intervened to address contain: Murray-Darling Basin program to purchase the Snowy from this diversion, in 2002 NSW, over-allocation and established the Murray- entitlements for use as environmental water and Victoria and the Commonwealth agreed to fund Darling Basin Authority (MDBA). The MDBA • long-term average SDLs for the amount of • the $5.8 billion Sustainable Rural Water Use a scheme to return 21 per cent (212 gigalitres) of was to develop and implement a Basin Plan to surface water and groundwater that can be and Infrastructure program. the Snowy’s original flows by 2012. The recent include Sustainable Diversion Limits (SDLs). On taken from Basin water resources drought has resulted in a slower release of 1 September 2010 the MDBA announced that • requirements that state WRPs must comply The ALP gave a 2010 election commitment that environmental water than expected. During the it would be publicly releasing the Guide to the with it would buy as much water as necessary from 2010 election campaign the ALP announced that Proposed Basin Plan on 8 October 2010. Later it • an environmental watering plan for the Basin willing sellers to restore the Murray River to health it had reached an agreement with the NSW and will release the Proposed Basin Plan and the Basin • a water quality and salinity management plan as needed under the Basin Plan. Victorian Governments. This agreement promised Plan. CSIRO has advised the MDBA about future for the Basin and a $13.7 million compensation payment to Snowy climate scenarios for use in modeling future water • rules about trading of water. Hydro for the 56 gigalitres in water to be released yield from catchments for the Basin Plan. A 2008 from the Jindabyne Dam into the Snowy River over amendment to the Commonwealth Water Act 2007 These will operate together to ensure that the the next two years. provided a commitment for critical human needs. social, economic and environmental outcomes of the water resources are not compromised. The The Murray Darling Basin Authority Plan will also include an outline of risks to Basin water resources, such as climate change, along Library publications and key documents The MDBA is responsible for planning the with strategies to manage those risks. integrated management of the water resources Murray Darling Basin Authority (MDBA), Issues paper: development of sustainable diversion limits for the of the MDB. The MDBA will prepare the Basin The SDLs will be implemented through the water Murray-Darling Basin, MDBA, Canberra, 2009, http://www.mdba.gov.au/files/publications/sustainable- Plan for adoption by the Commonwealth Minister resource plans, which will be developed by the diversion-limits-issues-paper-12-11-09.pdf for Water and will implement and enforce the states but accredited by the Commonwealth. Plan—this will set a new cap on water use in the However there will be a five-year phase-in period A Martyn, J Tomaras and B McCormick, Water Amendment Bill 2008, Bills digest, no. 45, 2008–09, Basin. The MDBA also advises the Minister on for the SDLs for each WRP. Parliamentary Library, Canberra, 2008, http://www.aph.gov.au/library/pubs/bd/2008-09/09bd045.pdf the accreditation of state water resource plans (WRP). The Wentworth Group, in a June 2010 paper, FHS Chiew, W Cai and IN Smith, Advice on defining climate scenarios for use in the Murray-Darling Basin Plan argued that the MDB should not have its flow modelling, CSIRO report prepared for the Murray-Darling Basin Authority, Canberra, 2009, http://www.mdba. regime reduced below two-thirds of its natural gov.au/files/publications/Defining-climate-scenarios-report-from-CSIRO.pdf level. To ensure that flow rates stay about this, The drought from 2001 through 2009 has severely reductions in SDLs would be required across the Wentworth Group of Concerned Scientists (WGCS) RQ Grafton, I Kowalick, C Miller, T Stubbs, F Verity reduced the water resources of the MDB. The Basin. While the SDLs could remain at more than and K Walker, Sustainable diversions in the Murray-Darling Basin: an analysis of the options for achieving a years 2006–07, 2007–08 and 2008–09 had 90 per cent of present diversion levels for most sustainable diversion limit in the Murray-Darling Basin, Wentworth Group, Sydney, 2010.

Page | 58 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Environment and energy Page | 59 and rocky shore habitats. The toxicity and physical Australian Government for damage to the marine Marine oil pollution properties of oil change over time. Chemicals used environment in East Timor. to disperse oil and increase the rate of breakdown Bill McCormick, Science, Technology, Environment and Resources Section can themselves be toxic to marine life. There are It would seem there is a need for a broader long-term impacts of oil spills and they need to regulatory system for compensation of pollution be assessed. The Australian Government and damage covering offshore oil exploration and PTTEP Australasia, in response to the Montara oil production similar to the Conventions that cover spill, have agreed to a two to ten year monitoring shipping. The issue of marine oil pollution has become the liabilities for the spill. By September 2010 BP plan that includes scientific studies to provide topical with several major oil spills occurring in had spent an estimated $8 billion on the clean-up. information on marine life, wildlife and habitats, Impact on offshore oil exploration 2009 and 2010. Despite improvements in control water quality and shoreline ecology. technologies, spills can have a significant impact Recent ship oil spills After the recent well blow-outs, the US Federal on coastal and marine environments and thus on Oil spill compensation Government and the Australian Government the livelihoods of those in the fishing and tourism Significant shipping traffic occurs through the responded but with several differences. The depth industries. The Australian Maritime Safety Authority (GBR) Region and along the There are limits to the amount of compensation of water in which these wells were drilled was coordinates the response to oil spills under the east coast of Australia. In 2009 the cargo ship, the that shipping companies and oil exploration significantly different, with Montara being drilled National Plan to Combat Pollution of the Sea by Oil Pacific Adventurer, leaked more than 270 tonnes companies are liable for under international in about 80 metres of water while the Macondo and Other Noxious and Hazardous Substances. of fuel oil which polluted the beaches of Moreton conventions. well was drilled in about 1500 metres. Wells are Island, Bribie Island and the Sunshine Coast. The being drilled in increasingly deep water, creating Recent oil well blowouts Shen Neng 1, a bulk coal carrier that ran aground, Under the Civil Liability Convention tanker significant difficulties in controlling any blows-outs, spilled three tonnes of fuel oil and gouged a three- owners are required to maintain insurance to as the Macondo disaster demonstrated. The Montara Wellhead Platform blowout on kilometre long channel in the reef in April 2010. cover pollution damage up to a maximum of 21 August 2009 resulted in the spillage of oil A Pacific Adventurer-sized spill within the GBR $170 million. Where the damage exceeds this Unlike the Australian Government, which continued and gas into the Timor Sea. The spill lasted Marine Park could have damaged a significant limit the Convention on the Establishment of to award offshore exploration permits while 105 days until a relief well was drilled and the area of reef. an International Fund for Compensation for Oil waiting on the recommendations of the Montara well could be capped. The rig operator (PTTEP Pollution provides additional compensation of Commission of Inquiry, the US Government Australasia) initially estimated that 64 tonnes Compulsory pilotage has been introduced for up to $1.2 billion. For non-tankers, the Bunker ordered a six-month moratorium on deep water per day (400 barrels) of crude oil were being specific routes through the northern portion of Convention provides liability based on ship size, so drilling while existing rigs were being inspected. A lost but no accurate estimate was ever made of the GBR and the Torres Strait. There have been a 30 000 tonne ship would be liable for $23 million. US Federal Court Judge in New Orleans blocked the spillage. The oil slick caused damage to the calls for extension of this pilotage for significant the ban but the ruling is subject to appeal. waters and coastline of Indonesia and East Timor. portions of shipping routes within the rest of the As part of the permit/approval process, the Amendments to legislation presently before the In November 2009 the Australian Government GBR Region. The Shen Neng 1 was off course operators of Montara and other offshore oil wells US Congress could bar companies from access to set up the Montara Commission of Inquiry. The by 12 kilometres. As part of the response to are required to maintain adequate insurance offshore areas if the companies have been heavily Commission report was submitted to the Minister improve safety issues arising from the Shen Neng to cover clean-up costs or other remediation fined for air or water pollution. for Resources and Energy in June 2010, who has grounding, the Australian Maritime Safety Authority effects of oil spills but not for compensation for not yet released it publicly. decided against extending compulsory pilotage environmental damage. Comments within the GBR and instead extended the current On 20 April 2010, in the Gulf of Mexico, a blowout coverage of the Reef Vessel Traffic Service to the In July 2010, Indonesian President Yudhoyono Deep water oil exploration presents significant caused an explosion and fire on the Deepwater southern boundary of the GBR. said he would seek compensation from PTTEP issues as to how to respond to blow-outs. The Horizon drilling rig at BP’s Macondo Prospect. Australasia for seaweed farmers and fishermen compensation implications of spills such as from The leak was finally stopped on 15 July 2010. In 1992 the International Convention for the whose livelihoods were affected by the Montara Macondo can be potentially catastrophic for all The failed blowout preventer was replaced in Prevention of Pollution by Ships made it mandatory oil spill—this may amount to over $2 billion. East but the largest oil companies. Will the Australian early September 2010. Initially between 53 000 for new oil tankers ordered after 1993 to be fitted Timorese President Ramos-Horta was also Government be liable to cover any shortfall? and 62 000 barrels of oil were leaking daily, with double hulls to reduce the risk of oil spills. seeking compensation from the company and the although this decreased over time. The total spill More recent amendments require the phasing-out is estimated to have been 4.9 million barrels. An of single hull tankers by 2010. estimated 6.4 million litres of dispersant were sprayed on the surface of the water or added at Environmental impacts the wellhead at the seafloor. Thirty seven per cent Library publications and key documents of the US federal waters in the Gulf were closed to Oil spills affect marine life through the direct fishing at the height of the spill. In June 2010 BP toxicity of oil, by the smothering effects of the oil Australian Maritime Safety Authority, Major oil spills in Australia, http://www.amsa.gov.au/Marine_Environment_ agreed to set up a $20 billion claims fund to cover on plants and animals, and by coating beaches Protection/Major_Oil_Spills_in_Australia/

Page | 60 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Environment and energy Page | 61 Commonwealth funding to deliver any outcomes. Pulp mills Tasmanian forests: future agreement? In July 2010 the Commonwealth was reported to have told the negotiators that Commonwealth Two proposals for a world-scale bleached kraft Bill McCormick, Science, Technology, Environment and Resources Section money would be made available to help fund any eucalypt pulp mill have been put forward but agreement. have been opposed by significant sections of the Tasmanian community. The first was in In August 2010, logging contractors called for a 1988 at Wesley Vale, but concerns about the $50 million payment to save 3000 jobs during the potential impact of the pulp mill effluent on the The Tasmanian forest industry has changed over state and federal governments to include old present downturn and the Coalition and the ALP marine environment resulted in the March 1989 the last forty years with the development of an growth forest and wilderness in conservation promised $20 million to begin a restructure of the Commonwealth decision that the mill could export woodchip industry, closure of some pulp reserves. In 1995 the Commonwealth initiated the sector due to a significant decrease in availability only proceed, subject to the development of and paper mills and the re-tooling of saw mills to Comprehensive Regional Assessment process of high quality sawlogs from 2015. This is also Commonwealth pulp mill effluent guidelines. enable the processing of timber from regrowth so that such areas would be protected and the supported by Andrew Wilkie, the newly-elected Thereupon the Canadian joint venture pulled out forests and plantations, rather than from old- forest industry would have certainty of future independent member for Denison. The Greens will of the project. Later that year the Commonwealth growth forests. wood supply. This was done through the Regional not support this without an agreement to end all published the CSIRO’s Environmental Guidelines Forest Agreements (RFAs) where 90 per cent logging in native forests. for New Bleached Eucalypt Kraft Pulp Mills, Native forests of wilderness and 60 per cent of old-growth which were reviewed and updated in 1995 to forests are protected in reserves. The twenty year A leaked draft negotiating document from the take account of technological advances. In 2004 There is considerable public pressure to include Tasmanian RFA was signed in 1997. In May 2005 talks on 25 August 2010, although not an agreed these guidelines were updated by the Tasmanian more high-conservation native forests in reserves a Supplementary Tasmanian RFA was signed position by either party, mentioned: Resource Planning and Development Commission and move the sourcing of wood products to that protected an additional one million hectares as guidance for any future pulp mill in Tasmania. plantations. of old-growth forests. However, the RFA and the • a halt to all logging in high-conservation native subsequent certification of Tasmanian forests forests within 30 days of the agreement being In 2005, Gunns announced that Long Reach on The size of the publicly owned production forest as sustainably managed under the Australian signed the Tamar River would be the site for its proposed estate has contracted, resulting in a reduction Forest Certification Scheme, have not halted the • a full moratorium on logging in all public native pulp mill. There have been objections to the of the sawlog and pulplog yield. This was due significant public opposition to the continued forests other than in some agreed low-value project because of the siting in the Tamar Valley, to the inclusion of forests in the reserve system. logging of old growth forests. regrowth areas within three months the bleaching process involved, and the proposal Over the past thirty years eucalypt plantations • agreement from environmental groups for to source some pulp wood from native forests. have expanded which has resulted in increased Over the past few years the Japanese woodchip Gunns to build its $2.5 billion pulp mill in the The original pulp mill assessment by the Resource pulpwood, and to a lesser extent sawlogs, from buyers have indicated they want either woodchips Tamar Valley, without protest and obstruction in Planning and Development Commission was these plantations. from plantations or certification by the Forest financial markets halted with the Tasmanian Parliament passing Stewardship Council for woodchips that are • all parties to ask the state and federal special legislation to give approval to the pulp mill. The drop in production from native forests sourced from native forests. This requirement, governments for a fully funded package to In October 2007 the Commonwealth approved along with new more efficient equipment has combined with the downturn due to the global implement the native forest exit deal, including the project under the Environment Protection and contributed to a decrease in people employed in financial crisis, has contributed to a recent financial assistance for contractors and Biodiversity Conservation Act 1999, subject to the logging, sawmilling, pulp and paper sectors reduction in the ability to sell native forest • a guaranteed, sustainable quantity and quality certain environmental conditions, including relating from approximately 6 600 in 1991–92 to 4 700 in woodchips. There have been rolling closures at of wood for remaining contractors. to discharge of effluent into Bass Strait. 2008–09. Gunns woodchip plants with subsequent job losses. The state Liberals opposed such an agreement Comments There is ongoing conflict between the conservation saying it would cost more than 3500 jobs and lock movement and the forest industry. In 1989 the About 80 per cent of the Tasmanian native forest up 600 000 hectares of forest. Any resulting agreement reached to resolve Tasmanian Government negotiated the Salamanca timber is exported as woodchips compared with the differences over forest issues in Tasmania Agreement with conservation groups and the about 93 per cent from eucalypt plantations. The Wilderness Society negotiating the agreement will require structural adjustment of hundreds forest industry to work towards a resolution of and the Tasmanian Greens indicated they were not of millions of dollars to implement. A significant their differences. This agreement ultimately broke Present negotiations opposed to a Tasmanian pulp mill but were to the amount of this money will most likely come from down after a year of talks when the combined Gunns pulp mill in the Tamar Valley. Andrew Wilkie the Commonwealth. environmental groups walked out. Since May 2010 the Tasmanian Government also indicated his opposition to the Tamar mill. has supported negotiations between timber and Commonwealth involvement in native forestry conservation organisations to look at sustainable In September 2010 Gunns announced that it would activities in Tasmania started with the regulation options to resolve the issues of conflict. Any move towards ending the use of woodchips and of exports of woodchips in the 1970s. Since then agreement from these talks has to gain community sawlogs from native forests. conservation groups have sought to convince support and would need Tasmanian and

Page | 62 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Environment and energy Page | 63 cannot be reached when significant uncertainty Australia’s role International whaling remains over population numbers. Some countries Australia is one of the strongest anti-whaling oppose the concept of whaling in any form. This countries. It is committed to non-lethal whale Marguerite Tarzia and Bill McCormick, Science, Technology, Environment and led to an impasse in 2007, which continues to research using technologies such as satellite Resources Section date. At the same meeting, the IWC passed a non- tagging and biopsy, to demonstrate that killing binding resolution asking Japan to halt scientific whales is unnecessary. whaling in the Southern Ocean. The IWC Scientific Committee found that the current research goals Australia initiated proceedings in 2010 in the Background to the whaling issue emerged of black market trade in whale meat from were neither critical nor requiring lethal measures, International Court of Justice against Japan Japan to South Korea and America—a breach of and that previous research goals had not been for breaching the Whaling Convention. Alleged Since 1986 whaling has polarised the international CITES. reached. breaches include conducting ‘scientific’ whaling community. This followed the International with a lack of relevance to conservation and Whaling Commission (IWC) ‘moratorium’ on Norway and Iceland 2010 proposals at the IWC management of whale populations, and on such a commercial whaling—a response to the global scale as to constitute commercial whaling; hunting over-exploitation of many whale species. Pre- Norway and Iceland objected to the IWC Since 2007 the IWC has pushed for a workable fin and humpback whales within the Southern moratorium, commercial whaling occurred moratorium, and so are not bound by the ban. compromise. During the 2010 IWC meeting a new Ocean Sanctuary; and breaching the CITES globally with the largest whaling grounds located They therefore continue to commercially hunt fin proposal was introduced which recommended: Convention through illegal trade. in the Southern Ocean around Antarctica. Many and common minke whales with self-allocated species came close to extinction. While some annual quotas. Iceland also conducts scientific • maintaining the moratorium but introducing show signs of recovery, other species remain whaling. They both hunt in the North Atlantic, a 10-year interim period with IWC-regulated Future outlook critically low in numbers. Fin whales are listed by within their Exclusive Economic Zones (EEZ). whaling and the elimination of self-allocated While Australia has begun legal proceedings, the International Union for Conservation of Nature quotas and the process and outcomes of this will be time- as an endangered species. Disputed population • capping quotas at significantly lower levels than Japan consuming, with Japan given until 2012 to lodge estimates of Antarctic minke whales are of a few current catch limits. initial pleadings. This will not solve the IWC hundred thousand animals. This estimate is given Japan is bound by the IWC moratorium. Since impasse and an IWC resolution to this issue is as justification for currently hunting this species. 1987 Japan has issued permits to hunt whales New Zealand backed the proposal as a means to necessary. More anti-whaling nations may begin for scientific purposes—a clause in the Whaling reduce the number of whales killed over the next to consider compromises to regulate and reduce Convention permits whaling for ‘essential’ and ten years. Other countries voted it down. Australia The ban on commercial whaling whaling. In the past 20 years Japan has firmly ‘critical research’. The scientific program includes viewed it as legitimising commercial whaling, with maintained its stance on whaling. One possible The IWC moratorium was initially designed whaling in Japanese coastal waters and the concessions to whaling nations compromising outcome is for Australia to develop an acceptable as a pause in commercial whaling. Rigorous North Pacific and within the IWC Southern Ocean the long-term goals to end whaling. Australia proposal which permits regulated coastal whaling population assessments were planned, which Whale Sanctuary (created in 1994). The sanctuary presented its own proposal that argued for: in the three countries’ EEZs with a phase-out of could be used in a revised management scheme prohibits commercial whaling, but does not whaling in the Southern Ocean Sanctuary. This (RMS) to determine sustainable catch limits for prohibit scientific whaling. Under Japan’s Antarctic • an end to ‘scientific’ whaling and commercial may defuse the political situation and lead to unprotected species. Although the methodologies research program, its annual quota is 850 whaling through objection significant reductions in whaling. for population estimates are improving, robust Antarctic minke whales, 50 fin and 50 humpback • phasing out scientific whaling numbers for most species (pre and post whales. This program has angered anti-whaling in the Southern Ocean commercial whaling) do not exist. The ban on countries, who argue that ‘scientific whaling’ is in Sanctuary within five years whaling has continued as countries are unable fact commercial whaling in all but name. Minke • prohibiting all whaling in to agree on both the acceptability of commercial whale meat from the research activity is sold sanctuaries whaling, and sustainable catch limits. In response legally within Japan, as the Convention requires • no new species approved for to this, Iceland, Norway and Japan have lobbied the meat to be used. Japan denies all accusations whaling and INDIAN OCEAN hard to reinstate ‘sustainable’ commercial whaling, that the scientific whaling program is commercial • improved consideration of SOUTHERN OCEAN WHALE SANCTUARY and have continued to hunt whales under special whaling in disguise. threats and conservation WHALE SANCTUARY scientific permits, or objections to the International status. Convention for the Regulation of Whaling. The Anti-whaling perspective appendix I listing of the Convention on International Library publications and key documents Trade in Endangered Species (CITES) prohibits all Anti-whaling countries have consistently voted trade for many whale species. Iceland, Norway against a return to commercial whaling under the International Whaling Commission (IWC) website, Commission information, http://www.iwcoffice.org/ and Japan object to the listing of these whale RMS, due to fears that commercial whaling will not commission/iwcmain.htm#conservation species, which means that they can trade in whale be effectively managed, will expand and lead to meat amongst themselves. Recently, evidence has over-exploitation, and that sustainable catch limits Department of Sustainability, Environment, Water, Population and Communities, International protection of whales, http://www.environment.gov.au/coasts/species/cetaceans/international/index.html#future

Page | 64 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Environment and energy Page | 65 proven to be viable and can be implemented on a changing global circumstances such as falling The minerals sector large scale, coal’s environmental credentials would world demand. Such circumstances lead to a dramatically improve. decline in Australia’s terms of trade. Michael Roarty, Science, Technology, Environment and Resources Section Other aspects A major shift from earlier periods in the Australian minerals sector is that today’s major mining Mining of hydrocarbons (coal, oil and methane companies have a global focus and seek the most gas) faces controversy because of the greenhouse profitable mining ventures. This means they have Mining has long been a cornerstone of the Mineral exports gas emissions associated with the combustion of no allegiance to a particular country. However, a Australian economy and the gold rushes were these substances—a fact that is down to society’s vote of confidence in Australia is illustrated by huge pivotal in the early development of the country. The resources sector (including oil and gas) addiction to hydrocarbons rather than mining per capital investments currently being undertaken Australia is presently in the midst of yet another contributed just under $160 billion to export se. It must also be acknowledged, however, that in a number of resource sector projects across minerals boom—exhibited by both high prices earnings in 2008–09, compared with $35.9 billion mining of any commodity, if not properly managed, Australia. for, and record export volumes of mineral for the rural sector and $38.3 billion for can cause localised pollution, soil degradation and commodities, especially iron ore and coal. This manufacturing. The growth of mineral commodity release of potential toxins. On the other side of the Minerals Resource Rent Tax follows previous minerals booms in the early 1960s exports since 2003–04 has been phenomenal, ledger, mining employs 133 200 people directly, and mid-1980s. The present boom is underpinned driven by strong demand for iron ore and coal. The and Australian mining companies are major The most recent issue that has raised considerable by high demand for primary commodities in the value of iron ore exports increased from $5.3 billion developers, users and exporters of computer interest and debate in the resources sector was industrialising economies of China and India. in 2003–04 to $34.2 billion in 2008–09 while software used to improve the efficiency of mining the announcement in the 2010 Budget of the metallurgical and thermal coal increased in value operations. The industry is also the largest imposition of a Resources Super Profits Tax Geologically, Australia is an ancient continent from $6.5 billion to $36.8 billion and $4.4 billion employer of environmental scientists in the country. (RSPT) on the minerals industry. Shortly after the with an abundant supply of minerals. The known to $17.9 billion respectively over the same period. ALP leadership change it was announced that deposits have been relatively easy to discover and The Australian Bureau of Statistics showed a Australia has developed a capacity to produce far the RSPT proposal would be replaced with a develop. Australia has relatively flat terrain and trade surplus for the June Quarter 2010 (a rare greater volumes of commodities than are required proposed Minerals Resource Rent Tax (MRRT). is sparsely populated apart from some coastal phenomenon), largely due to increases in both for domestic consumption. However, this forces In contrast to the RSPT, this would apply only to regions, both aspects advantaging exploration volume and prices for exports of iron ore and coal. reliance upon the circumstances of the global mined iron ore and coal rather than to all minerals. and mine development. Western Australia and market rather than setting prices according to The major iron ore and coal producers, namely Queensland are the most resource-rich states. Of Coal the cost of production. Commodity prices are set BHP Billiton, Rio Tinto and Xstrata, indicated to the Australia’s roughly 340 mines, almost half are in in international markets by supply and demand Gillard Government that the newer proposed tax Western Australia. Australia has very large reserves of extremely fundamentals. In the current settings, commodity was less likely to reduce future mine investment. high quality thermal coal (used for making steam prices are at record highs because of strong world However, smaller mining companies have shown Today, the Australian minerals sector accounts for and generating electricity) and coking coal (used demand. This circumstance has dramatically significant opposition to the MRRT proposal. eight per cent of gross domestic product (GDP). for steel making) located in New South Wales improved Australian terms of trade—that is the With both schemes, the Commonwealth said that Australia is among the top five producers of most and Queensland. The coal industry is the mineral ratio of export to import prices. Put another way, it intends to rebate any forgone mineral royalty of the world’s key mineral commodities, being: industry’s largest employer. it takes fewer exports of a mineral commodity to income to the states and territories. balance the purchase price of, say, car imports. • the world’s leading producer of bauxite, Despite the difficulties associated with coal However, commodity prices can fall because of alumina, rutile and tantalum production and use (concern over carbon dioxide • the second largest producer of uranium, lead, emissions), some 41 per cent of the world’s ilmenite, zircon and lithium electricity is generated using coal and this • the third largest producer of iron ore, and zinc proportion is continuing to increase. In Australia, • the fourth largest producer of black coal, gold, over 80 per cent of our electricity is generated manganese and nickel and by coal-fired power stations. In capital-intensive • the fifth largest producer of aluminium, brown industries, such as power generation, it is not coal, diamonds, silver and copper. technologically feasible to achieve rapid change. Library publications and key documents A technology involving carbon capture and Additionally, Australia is the world’s largest storage (CCS) which takes the carbon dioxide Minerals Council of Australia (MCA), The Australian minerals industry and the Australian economy, MCA, exporter of black coal, iron ore, alumina, lead and emitted from coal-fired power plants and reinjects Canberra, March 2010. zinc and the second largest exporter of uranium. it into suitable rock formations underground for permanent storage, is actively being evaluated. For P Knights and M Hood, eds, Coal and the Commonwealth: the greatness of an Australian resource, University more on this, see the brief Climate Change Action: of Queensland, Brisbane, 2009. A Multi-faceted Approach in this book. If CCS is

Page | 66 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Environment and energy Page | 67 Whistleblower protections—proposals for public officials where there had been an honest Public sector accountability and transparency reform and reasonable belief that the public interest disclosure should be reported. The range of Mary Anne Neilsen, Law and Bills Digest Section Whistleblower protection is ultimately about matters that could be protected include amongst disclosure of information. The thrust of a others: illegal activity, maladministration, wastage whistleblower protection scheme is to protect of public funds, dangers to public health or workers who draw attention to problems they safety, dangers to the environment; and official see in the workplace, ranging from corruption misconduct. Responsibility would be assigned The agreements between the minority Labor A major part of the FOI reforms is the creation of and threats to public health and safety, to to the Commonwealth Ombudsman and the Government with the various independents an Information Commissioner position. It is an mismanagement and public wastage. A worker Inspector-General of Intelligence and Security for have a common theme of pursuing principles of independent statutory position, with a range of who follows a designated procedure in disclosing receiving whistleblower complaints, monitoring transparent and accountable government. Aligned functions that include investigation of complaints information about workplace wrongdoing will the investigation and handling of those complaints with these promises is a new and important phase about FOI administration, merit review of access receive protection against criminal and disciplinary by government agencies, and ensuring that of information disclosure in Australian government denial decisions, publication of FOI guidelines, and sanctions and receive assistance aimed at whistleblowers are properly protected. On one administration set to commence later this year. providing advice to government on information safeguarding their employment and career. matter, the Government’s response went further policy. The Information Commissioner Designate, than the Standing Committee report, in expanding Freedom of information reform John McMillan, is enthusiastic about the new Australia’s federal laws currently offer very the circumstances in which a person can make a position noting that the range of functions few protections for public interest disclosures. public interest disclosure to a third party, such as Freedom of information (FOI), or the statutory right conferred is extensive and go beyond the The Rudd Labor Government had plans to the media. of access to government documents, is justified traditional review role of settling individual disputes address this gap. It had accepted most of the on the grounds that it encourages transparency about document access. He foresees that agency recommendations for legislative reform made With the Greens and some independents and political accountability and promotes public heads and Ministers will need to heed the work of in a 2009 House of Representatives Legal and also making strong calls for the introduction participation in government and representative the Information Commissioner and take a greater Constitutional Affairs Committee report on of whistleblower protection laws and for more democracy. involvement in FOI administration. He also notes whistleblower protection and was planning to protection of journalists’ sources, the promised that the budget allocated to the new office of introduce legislation later this year. The proposed reforms of the previous Labor Government are In the 1970s Australia was a leading nation in $12.2 million over four years is more generous that scheme would facilitate public interest disclosures likely again to be on the political agenda during this introducing FOI laws into a Westminster-style perhaps was expected. in the Australian public sector being made by Parliament. democracy. However over time there was a general view that those 1970s reforms were not Another change that is likely to enhance the right to successful—that there was minimum cultural access is that agencies are being encouraged as change and that a presumption in favor of part of a new scheme to make documents public disclosure was not practised across government. independently of an FOI request. This information It was felt that government agencies could exploit publication scheme is due to commence in May restrictions and gaps in FOI laws to make it harder 2011 and again, the Information Commissioner for the public to gain access to government will play a large role in providing guidance and a Library publications and key documents information, especially information that might be stimulus to agencies. embarrassing to the government or agency. J McMillan, FOI and privacy reform: presentation to a joint seminar of the Commonwealth FOI Practitioners’ The new FOI scheme has been welcomed. It has Forum Privacy Contact Officer Network, Canberra, 26 June 2009. The Rudd Labor Government introduced major FOI been described as the biggest shake-up in the changes with the principal objects of promoting FOI Act’s history which hopefully will be effective M A Neilsen, Freedom of Information Amendment (Reform) Bill 2009, Bills Digest, no. 115, 2009-10, a pro-disclosure culture across the Government in causing a permanent cultural shift of openness Parliamentary Library, Canberra, 2009. and building a stronger foundation for more within public administration. Parliament, however, openness in government. These reforms, the bulk may see calls for further, more radical reform, M A Neilsen, Information Commissioner Bill 2009, Bills Digest, no. 114, 2009-10, Parliamentary Library, of which commence on 1 November 2010, are particularly in the area relating to those exemptions Canberra, 2010. comprehensive with all aspects of the FOI laws that continue to apply to certain types of being reformed—access procedures, FOI charges, documents and certain agencies. For example, the House of Representatives Standing Committee on Legal and Constitutional Affairs, Whistleblower protection: exemption criteria, FOI objectives, the procedure Greens and some independents are on the record a comprehensive scheme for the Commonwealth public sector; report of the inquiry into whistleblowing for review of disputed decisions, publication of as wanting to ensure that all government agencies, protection within the Australian government public sector, House of Representatives, Canberra, 2009. information by agencies, and FOI reporting by including intelligence agencies, are fully open to agencies. scrutiny and are accessible under FOI laws, whilst Australian Government, Government response to the House of Representatives Standing Committee on Legal safeguarding national security. and Constitutional Affairs, Whistleblower protection: a comprehensive scheme for the Commonwealth public sector, 2010.

Page | 68 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Law, justice and human rights Page | 69 government bodies elected in accordance with its An absolute majority of the House of Indigenous people, local government and laws and empowered to administer, and to make Representatives will be 76 votes; in the Senate by-laws for, their respective areas in accordance it is 39. In the new Parliament it may be of some other constitutional issues with the laws of the state’ (institutional recognition). significance that either chamber could go solo The Liberal/National Party opposed the on constitutional change, without the support of amendment. This proposed amendment was not the other, if it can achieve an absolute majority. In Diane Spooner, Law and Bills Digest Section for the Commonwealth to have a direct relationship this Parliament the opportunity to do so in either with the local government tier of government, chamber is quite novel. Constitutional recognition of Indigenous Recognition of Aboriginal and Torres Strait but was rather seeking to entrench the existing people Islanders in the preamble was put to a referendum situation of local governments being creatures of The Speaker’s vote in the House of Representative in 1999, as part of a whole new preamble. The the states. In other words, it was not seeking to could be of vital and critical importance. Under During the course of the election campaign proposed preamble included that the Australian cut the States’ middleman role. Another option section 40 of the Constitution the Speaker does both major parties made announcements about people commit to ‘honouring Aborigines and could be for symbolic recognition where local not vote except when the numbers are equal, then constitutional recognition of Indigenous people. Torres Strait Islanders, the nation’s first people, government could be referenced in the preamble he or she has a casting vote. There is a view that The Coalition promised to hold a referendum at the for their deep kinship with their lands and for their as being acknowledged as being part of the the Speaker who does not have full voting rights 2013 election on the wording of a preamble in the ancient and continuing cultures which enrich governance structure of the nation. should not be included in the number of votes Constitution to recognise Indigenous Australians, the life of our country’. The relevant Bill also required for an absolute majority which would and the ALP promised to set up an expert panel to amended the Constitution to make it clear that Constitutional change reduce the number to 75 votes in the House. build support for the constitutional recognition of the preamble had no legal effect and could not Indigenous people. be used to interpret the Constitution or any laws Constitutional change by way of referenda held The other aspect of this is that under the of the Commonwealth. However, the referendum pursuant to section 128 of the Constitution is agreements with the Greens and Independents, In the agreement with the Greens reached with was unsuccessful. Victoria and Queensland have difficult except when there is widespread and the Speaker and Deputy Speaker can participate the Government since the election, they will similar recognition in their constitutions, and New bipartisan support. Only 8 out of 44 have been in Private Member’s Business but cannot vote. work together and with other parliamentarians South Wales is in the process of doing so as well. successful. In essence, to be successful a It is possible in the new Parliament that a Private to ‘hold referenda during the 43rd Parliament or proposed law must be passed by an absolute Member’s Bill can achieve sufficient support in the at the next election on Indigenous constitutional There are strong views that the racist and majority of both Houses, or by one House twice, House, for example Mr Katter’s Bill on Constitution recognition and recognition of local government redundant section 25 of the Constitution should and at a referendum passed by a majority of Alteration (Just Terms) or Mr Abbott’s bill to in the Constitution’. The Greens announced that be repealed at the same time as any referendum people as a whole and by a majority of the states overturn the Wild Rivers Act 2005 (Qld) (which it they would be consulting widely with Indigenous on these issues. This provision has reference to (that is, at least four of the six). should be noted, does not entail constitutional organisations and constitutional experts on the disqualification from voting of a person on the change). nature of the constitutional recognition. basis of his or her race.

Amendment to the preamble of the Constitution Constitutional recognition of local is different from amending the Constitution government itself, although it is generally accepted that the same process of holding a referendum would be The question of constitutional recognition of local necessary under section 128 of the Constitution. government has unsuccessfully put to the people The way the agreement above is couched in referenda, twice. suggests that amendment to the preamble is Library publications and key documents the intended approach in relation to Indigenous In 1974 the question put was whether people recognition, and amendment to the actual approved a proposed law to alter the Constitution Australian Local Government Association, Constitutional recognition of local government, http://www.alga.asn. Constitution is the intended approach in relation to enable the Commonwealth to borrow money au/constitutionalrecognition/pdf/ExplanatoryNotes.pdf to local government recognition. A preamble for, and to grant financial assistance to, any local does not have direct legal effect or give rise to government body (financial recognition). The Bill S Bennett, The politics of Constitutional amendment, Research paper, no. 11, 2002–03, Parliamentary Library, substantive rights and obligations but may be used was opposed by the Liberal and Country parties in Canberra, 2003, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22library%2Fprs as an aid to interpretation or to resolve ambiguities. the House of Representatives. pub%2F2AP96%22

During the 42nd Parliament, the House of In 1988 the question put was whether people House Standing Committee on Legal and Constitutional Affairs, Reforming our Constitution, a roundtable Representatives Standing Committee on Legal approved a proposed law to alter the Constitution discussion, 23 June 2008, House of Representatives, http://www.aph.gov.au/house/committee/laca/ and Constitutional Affairs conducted its Inquiry into to recognise local government. The actual constitutionalreform/report.htm. Constitutional Reform. One chapter of its report proposed provision to be inserted was in the was devoted to Indigenous recognition and nation following terms: ‘Each State shall provide for M Garrily and G Williams, ‘Recognition of local government in the Commonwealth Constitution’, building through a new preamble. the establishment and continuance of local Public Law Review, 21, 2010, p. 164.

Page | 70 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Law, justice and human rights Page | 71 was overturned when a referendum was passed and appropriate anti-discrimination measures. Same-sex marriage by 52 per cent of voters (Proposition 8), but this Generally views on this matter in the Coalition was in turn overturned by another court decision were shown as divergent during the debate on the Kirsty Magarey, Law and Bills Digest Section that the Proposition was discriminatory and 2008 Bills, while more recently a Tasmanian Liberal unconstitutional. This is now the subject of appeal. candidate (unsuccessful) declared his readiness to cross the floor in favour of same-sex marriages if it Positions of the parties was a conscience vote. Background Four Australian states/territories have systems Both major parties have been consistent in their The Australian Greens and Independent Mr Wilkie which allow same-sex couples to register their rejection of any proposals to recognise same- strongly support a conscience vote on a Private The issue of same-sex marriage was recently relationships - Tasmania, Victoria, the ACT sex marriages. Indeed the Prime Minister has Member’s Bill addressing this issue. Were such referred to as the ‘issue that’s refused to go away and NSW. This recognition has a limited utility, repeatedly said that she believes ‘marriage is a Bill to be given a conscience vote and were it to this federal election campaign’. Certainly it seems however. While such arrangements are recognised marriage between a man and a woman,’ affirming pass through the Parliament, there would still be to be receiving more focused attention than it did for the purposes of some Commonwealth Acts, her Party’s position that ‘the Marriage Act is the possibility for constitutional challenge. That during the previous Parliament. The Government the schemes can have limited jurisdictional appropriate in its current form,’ (her personal could require the High Court to determine whether had focused on removing discrimination against applicability, depending on the relevant state or belief too). She also noted that ‘we have as a there is a sufficient nexus between the meaning same-sex relationships generally. However, the territory arrangements. government taken steps to equalise treatment for of the term ‘marriage’ and its constitutional Parliament refused to countenance same-sex gay couples’. incidence (‘divorce and matrimonial causes; marriage, despite several Private Members’ Bills, Another issue traditionally associated with the and in relation thereto, parental rights, and the including the Australian Greens’ Marriage Equality married state is the adoption of children. Same-sex Mr Abbott’s position was summarised in the 2008 custody and guardianship of infants’) to give the Amendment Bill 2009 (negatived in the Senate relationships are being increasingly recognised opinion piece, ‘Not for Adam and Steve’, which, Commonwealth power to regulate same-sex five to 45), and three earlier Private Members’ in this field. In Australia, WA, the ACT and to an while affirming the importance of ‘gay people relationships. In 2009 the Gilbert and Tobin Centre Bills introduced by the Australian Greens and extent Tasmania (‘stepchild adoption’ only), allow having solid lasting relationships’, went on to of Public Law commented it ‘cannot be said with Democrats in the last six years. same-sex adoption, and have recently been joined query whether those same-sex couples ‘who want any great confidence that the High Court at the by NSW, which passed the Adoption Amendment to claim the status of marriage [are] also ready present time is likely to find the Commonwealth While the major parties have been unwilling (Same-Sex Couples) Bill in September 2010. for its burdens’ and concluded ‘the relationship possesses legislative power to permit same- to countenance same sex marriage the Rudd between two people of the same sex cannot be sex unions under section 51(xxi)’. These issues Government responded to a significant Human International context a marriage because a marriage, by definition, is could only be finally resolved by the High Court. Rights and Equal Opportunity Report, Same Sex: between a man and a woman.’ During the election However, if such legislation were to be beyond the Same Entitlements, in 2008, passing the: Attention to the issue of same-sex marriage in campaign he reiterated his opposition to gay power of the Commonwealth, the possibility for a Australia often follows developments overseas. marriage in an interview but said that he favoured referral of power from the states remains. • Same-Sex Relationships (Equal Treatment The impetus for the Marriage Amendment Act formal recognition of same-sex relationships in Commonwealth Laws) Acts 2008 on 2004 was the fear that same-sex marriages superannuation and general law reform could take place overseas and subsequently be • Family Law Amendment (De Facto Financial recognised in Australia under the Marriage Act Matters and Other Measures) Act 2008 and 1961’s recognition of foreign marriages. Those • the Evidence Amendment Act 2008. amendments to the Marriage Act explicitly precluded same-sex marriages from being The combined effect of these Acts significantly recognised at all, and in particular such unions changed the legal status of same-sex couples, which occurred overseas now form an exception recognising them on an equal footing to de facto to the general principle that Australia recognises couples in areas as diverse as taxation law, social all overseas marriages. A growing number of Library publications and key documents security law, immigration and superannuation. countries allow same-sex marriages (ten countries While the Acts removed many discriminatory at the moment, and if certain specified areas in M A Neilsen, K Magarey, E Karlsen, et al, Same-Sex Relationships (Equal Treatment in Commonwealth Commonwealth provisions and gave recognition other countries were added to the count it would Laws—General Law Reform) Bill 2008, Bills Digest No. 44 2008-09, to same-sex couples as de facto couples, there be higher), although sometimes the right to adopt http://www.aph.gov.au/library/pubs/BD/2008-09/44bd020.pdf was no substantive insertion of anti-discrimination has not followed the right to marry. principles covering same-sex couples. Another J Norberry, Marriage Legislation Amendment Bill 2004, Bills Digest No. 155 2003-04, http://www.aph.gov.au/ element the Commonwealth measures did not US developments often impact on Australia. library/pubs/bd/2003-04/04bd155.pdf cover was the issue of a national relationships Same-sex marriage is recognised in a number of register, although the then Attorney-General US states and districts, and recent developments Legal and Constitutional Affairs Legislation Committee, Marriage Equality Amendment Bill 2009, November expressed his hope that the states and territories in California have been of particular interest. A 2009, Senate, http://www.aph.gov.au/senate/committee/legcon_ctte/marriage_equality/report/report.pdf would address these issues. court decision permitting same-sex marriage

Page | 72 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Law, justice and human rights Page | 73 Rights Framework document and related press parties pledged to ‘discontinue the Australian Parliament and the protection of human rights releases, which included proposals to establish Human Rights Framework’, as part of its projected a statutory Parliamentary Joint Committee on expenditure savings. Kirsty Magarey and Roy Jordan, Law and Bills Digest Section Human Rights which would scrutinise legislation compliance with human rights treaties and a Parliamentary Joint Committee on requirement that all new legislation introduced Human Rights or tabled in Parliament be accompanied by a compatibility statement on human rights. In In June 2010 the Rudd Government introduced Even though Australia is party to several Brennan Consultation Committee addition, the federal anti-discrimination laws the Human Rights (Parliamentary Scrutiny) Bill major human rights treaties, there is currently would be consolidated into a single Act to remove 2010, together with a related bill, the Human no Commonwealth legislation which directly In November 2008, the Rudd Government unnecessary regulatory overlap and make the Rights (Parliamentary Scrutiny) (Consequential implements two of the most important treaties, established a National Human Rights Consultation system more user-friendly. Provisions) Bill 2010. The Bills were to be a partial the International Covenant on Civil and Political Committee (NHRCC), chaired by Father Frank implementation of the Government’s response to Rights (ICCPR) and the International Covenant on Brennan, to undertake consultation and report The Government would also create an annual NGO the Brennan Committee report and establish the Economic, Social and Cultural Rights (ICESCR). by 30 September 2009. In his submission to the Human Rights Forum to enable comprehensive Parliamentary Joint Committee on Human Rights. Together with the Universal Declaration of Human Committee, shadow Attorney-General Senator engagement with non-government organisations The main Bill provided for the powers, proceedings Rights, these treaties and their Optional Protocols, George Brandis, on behalf of the Coalition on human rights matters (which already occurs and functions of the committee; and introduced a make up what is known as the International Bill Opposition parties, stated that ‘a statutory bill informally through the Attorney-General’s requirement for statements of compatibility to be of Human Rights. Such implementing legislation of rights is not the best model for advancing Department’s NGO Human Rights Fora), and prepared for all Bills and disallowable legislative is usually referred to as a ‘human rights act’, or human rights’ and instead he recommended that provide the Australian Human Rights Commission instruments. The Bills reached their second a ‘charter (or bill) of rights’—a statement of rights expanded parliamentary scrutiny of legislation with extra resources to enable it to promote a reading stage but lapsed in July 2010 with the which is either reviewable (or even enforceable) in from a human rights point of view by a new greater understanding of human rights across the general election. The provisions of both Bills were the courts and against which all newly introduced Parliamentary Committee would be a better community. referred to the Senate Legal and Constitutional legislation has to be benchmarked. The ACT alternative Affairs Legislation Committee in June 2010, which and Victoria, however, have implemented the A federal Human Rights Act, which may involve reported in July 2010 that, since both Bills had ICCPR by legislation in their jurisdictions. The The Brennan Committee recommended that the courts, was not intended at that stage but a lapsed, it would discontinue its inquiry. Commonwealth Constitution has only a small Australia adopt a federal Human Rights Act, along commitment was made to revisit the issue in 2014. number of enforceable human rights, such as the lines of legislation already introduced in the It is expected that both Bills will be reintroduced freedom of religion, as well as some implied rights Australian Capital Territory (ACT) and Victoria. In its 2010 election policy The Coalition’s Plan for into the 43rd Parliament. found by the High Court, such as freedom of The proposed legislation would set out a list of Real Action for Australia’s Future, the Coalition political communication. rights drawn from major human rights treaties, ensure that new legislation introduced into the Party policies Parliament was compatible with the Act and provide for the High Court to declare existing The major political parties have differing views on legislation incompatible with the Act and to refer the desirability of a human rights act. The Coalition the legislation back to Parliament for possible parties do not see the need for such an act and do amendment. not mention the issue in their policies. The former Prime Minister, John Howard, and former Attorney- One of the differences between the ACT and Library publications and key documents General, Daryl Williams, have stated that current Victorian legislation is that Victoria allows for arrangements and the common law provide an ‘override provision’—a legislative provision Attorney-General’s Department, Australia’s Human Rights Framework, 2010, http://www.ag.gov.au/www/agd/ adequate protection. Tony Abbott has said ‘Bills which allows the parliament to effectively exclude agd.nsf/Page/Humanrightsandanti-discrimination_TheAustralianHumanRightsFramework of rights are left-wing tricks to allow judges to particular legislation from the operation of the change society in ways a parliament would never Human Rights Act in exceptional circumstances, Parliamentary Library, Bill of Rights: Internet Resource Guide, http://www.aph.gov.au/library/intguide/law/ dare.’ The Australian Labor Party, in its 2007 such as threats to national security or a state of billofrights.htm National Platform, had a commitment to establish emergency. The ACT does not have a comparable an inquiry and consultation process to gauge provision and the question of whether it is National Human Rights Consultation, website, http://www.humanrightsconsultation.gov.au/ the need and support for statutory protection of appropriate for any Commonwealth legislation to rights. The Australian Greens policy is to ‘adopt have an override provision remains. Senate Legal and Constitutional Affairs Legislation Committee, Human Rights (Parliamentary Scrutiny) Bill 2010 Australia’s international human rights obligations and the Human Rights (Parliamentary Scrutiny) (Consequential Provisions) Bill 2010: Report and submissions, into domestic law and enact an Australian Bill of In April 2010, the Government responded to the Commonwealth of Australia, Senate, Canberra, 23 July 2010, http://www.aph.gov.au/senate/committee/ Rights’. NHRCC report by issuing its Australia’s Human legcon_ctte/human_rights_bills/index.htm

Page | 74 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Law, justice and human rights Page | 75 There has been a significant decision in the High Constitutional change ‘Property’ and acquisition on just terms Court since the Federal Court had found the Mr Spencer should not be heard. In ICM Agriculture The Bill also seeks to restrict state powers of Diane Spooner, Law and Bills Digest Section Pty Ltd v Commonwealth (the ICM decision) the acquisition and interference with the exercise of High Court held, in brief, that the legislative power rights without just terms compensation, which is of the Commonwealth does not extend to the grant the major complaint of persons such as Pearson of financial assistance to a state on terms and and Spencer. Such a change has significant conditions requiring the state to acquire property implications for state sovereignty and rights. A Private Member’s bill amendments. Other Private Members’ bills for on other than just terms. In essence this means proposing change may arise in this Parliament, that the Commonwealth cannot by way of section This issue raised by Katter’s Bill and in these court On 21 June 2010, a Private Member’s Bill was including recognition of same-sex marriages, 96 (the grants power) or any other provision cases will continue to be very alive and relevant introduced into the House of Representatives by indigenous Australians, local government and provide money for a state requiring the state to to the new Parliament and in all jurisdictions. . The Bill was called the Constitution possibly a Bill of Rights. Same-sex marriage resume land on unjust terms. Currently in Western Australia, the Premier is Alteration (Just Terms) Bill 2010. legislation and a Bill of Rights could be achieved contemplating the compulsory acquisition of through ordinary legislation, without constitutional Katter’s Bill does remain relevant even in light land in the Kimberley region for a gas precinct. The purpose of the Bill was to alter the change, and this may be a preferred approach to of the ICM decision. That case, and Spencer’s While some form of compensation would likely be Constitution to provide that Commonwealth and these issues. prospective case, relies on the existing section payable for the extinguishment of claimed native state governments’ acquisition of property and 51(xxxi), and the narrow expression ‘acquisition of title rights, the proposed acquisition has been restrictions on the exercise of property rights In his first reading speech, Katter put the context property’. The proposed changes in the Bill widen described by Professor Mick Dodson as being: ‘In can only be undertaken after the provision of of his Bill into two specific instances. The first was this to include any restriction on the ’exercise of a sense it’s another act of colonialism, it’s another compensation on just terms. Noel Pearson on the ‘theft’ of Aboriginal access to property rights.’ This attempts to pick up licence theft of our land, it’s another invasion, it should water, timber, and rocks without paying a ‘single rights, access to land, water rights, and so on, never ever be contemplated at the political level.’ Section 51(xxxi) of the Constitution currently allows cent in compensation’ (this is reference to the that may not always gain the protection of the the Parliament to make laws for the acquisition of Wild Rivers legislation). Katter quoted Pearson just terms provision. There would have to be Should any legal challenges eventuate, Katter property on just terms from any state or person threatening the Queensland government with the an assurance that any change does not have a could potentially back Professor Dodson and Noel for any purpose in respect of which the Parliament words ‘We’ll see you in the High Court. We have retrospective effect, otherwise some existing laws Pearson all the way to the High Court due to the has power to make laws. The Bill seeks to repeal been there before and we beat you last time’. Mr may be rendered unconstitutional. enhanced significance of Private Members’ Bills in and substitute section 51(xxxi) to extend the Katter added ‘And I will be backing him this time’. the new Parliament. payment of just terms not just to the acquisition of property but also to any laws placing restrictions Recent court decisions on the exercise of ‘property rights’. The second reference in the first reading speech Further, it adds a proposed section 115A to the was to the actions of Mr Peter Spencer who at Constitution which would prohibit state laws the time was protesting NSW legislation and acquiring property or restricting the exercise of Commonwealth actions that diminished Spencer’s property rights of any person, except on just ability to clear his land as he pleased and which terms. This is because the states’ constitutions do he alleged diminished the value of his land and this not have a guarantee on just terms compensation. constituted an unjust acquisition of his property.

Under section 128 of the Constitution the only Spencer’s case will continue during the term way the Constitution can be altered is by way of of this Parliament. On 1 September 2010 he Library publications and key documents a referendum. A Bill providing for constitutional successfully won his case in the High Court for his change must pass both chambers of Parliament by right to have his matter heard back in the Federal Constitution Alteration (Just Terms) Bill 2010. an absolute majority, or by one House twice, and Court of Australia. The Commonwealth and the then the question posed by the Bill be agreed to by states tried unsuccessfully to have Mr Spencer’s Constitution Alteration Bill First Reading Speech, House of Representatives, Debates, 21 June 2010, p. 5995. a majority of people as a whole, and in the majority case not heard on the ground that he had no of the states (that is, at least four of the six). ‘reasonable prospect of success’. In the course of Spencer v Commonwealth of Australia [2010] HCA 28. the judgment, the Chief Justice did say ‘that is not If Katter chooses to reintroduce his Bill, the 43rd to say that … he has a strong case. It is sufficient ICM Agriculture Pty Ltd v Commonwealth [2009] HCA 51. Parliament has the option of passing it, thereby to say that it is not fanciful …’ agreeing that the terms of the Bill be submitted G Williams Property Rights and Just Terms Compensation, NSW Farmers Association Annual Conference, to the Australian people for constitutional 20 July 2010.

Page | 76 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Law, justice and human rights Page | 77 not an inviolable right; rather, it is a privilege that said, a significant number of market testing Plain packaging of tobacco products can be withdrawn or modified, especially in the studies indicate that tobacco packaging acts as a interests of public health. promotional tool, and threatened legal challenges Dr Matthew Thomas, Social Policy Section to plain packaging from the industry provide some Unsurprisingly, the tobacco industry does not support for this finding. Put simply, if the plain agree with such assessments. It is likely to first packaging proposal did not threaten to reduce the fight the proposal on the grounds that it violates industry’s profitability, then it would be unlikely to the right of property ownership. Should it fail in mount a legal challenge against it. The Government plans to introduce plain Currently, trademarks and related intellectual this approach, it is likely to demand significant packaging for all cigarettes sold in Australia by 1 property rights are protected under a range compensation for what it sees as the deprivation of The industry is also liable to argue that plain July 2012. The legislation would restrict or prohibit: of international trade agreements, including its property rights. For example, in its submission packaging could actually lead to an increase the Agreement on Trade-Related Aspects of to the Senate Committee inquiring into the Plain in smoking uptake. This is because, with the • tobacco industry logos International Property Rights 1994 (TRIPS). The Tobacco Packaging (Removing Branding from introduction of plain packaging, price would • brand imagery tobacco industry maintains that the introduction of Cigarette Packs) Bill 2009, Philip Morris argued become the sole identifiable product feature, • colours, and plain packaging regulations would violate minimum that the plain packaging requirement would be resulting in price competition among tobacco • promotional text other than brand and product obligations for the protection of intellectual in breach of its property rights as guaranteed companies. This, in turn, would result in cigarettes names in a standard colour, position, font style property rights under trade agreements in general, under section 51 (xxxi) of the Constitution. Section being more affordable to vulnerable smokers, and and size. and under Article 20 of TRIPS, in particular. 51(xxxi) guarantees just terms compensation particularly young people. One logical response Essentially, the relevant section of Article 20 where property is acquired compulsorily from to such claims is that, were tobacco companies In addition, the existing graphic health warnings specifies that the use of a trademark should not any state or person. Philip Morris has indicated to reduce their prices in response to the measure, displayed on cigarette packaging would be be restricted in such a manner as to limit its ability that, in its view, if the Government were to require then an increase in excise could be used to updated and expanded. Beyond these broad to differentiate a given good or service from other plain packaging, then it would need to acquire counter this effect. parameters, there is no further detail on the goods and services. the relevant Philip Morris property and/or pay proposal at this stage. This is at least partly reasonable compensation. In response to such The industry has also argued that plain packaging because the Government has yet to develop and As the tobacco industry sees it, the demand claims it may be argued that the Government would make it easier to counterfeit and smuggle test package designs that will make cigarettes less for plain packaging represents an illegitimate has no interest in acquiring tobacco industry- tobacco products. The resulting distribution of appealing, especially to young people. However, it restriction in breach of the system of international owned trademarks; it simply does not want them tobacco products through unregulated, untaxed is likely that the measure will closely resemble the trademark protection with which governments appearing on tobacco products for reasons of criminal networks would both enhance their plain packaging recommendation of the National are obliged to comply. The industry is also likely public health. Given that the Government would accessibility to vulnerable and underage smokers Preventative Health Taskforce. to argue that the introduction of plain packaging not stand to gain any benefit from the acquisition, and make policing of illicit trade more difficult. The regulations in Australia would constrain the free it could be argued that the proposal would not National Preventative Health Taskforce has argued The tobacco industry is strongly opposed to the movement of tobacco products between Australia amount to an acquisition of property as specified that this need not be the case. For example, one proposal, with a number of companies having and other countries, and thereby constitute an at section 51(xxxi) of the Constitution. strategy for reducing the potential for illicit trade indicated that they are prepared to fight it on legal unlawful barrier to international trade. would be the mandating of some form of tax grounds. Other arguments against the proposal markings that would make cigarette packages In response to such claims it has been argued difficult to counterfeit. Legal arguments against the proposal by some legal and public health commentators The tobacco industry is also likely to contest that the purpose of trademark law is not limited the proposal on the grounds of evidence and It is difficult to determine the likely fate of the plain Government imposition of mandatory plain to the protection of private property rights. unintended consequences. packaging proposal given that the position of packaging for tobacco products has been Trademark law is also concerned with ensuring the the Coalition and the independent members is objected to on the claimed grounds that the provision of accurate information to consumers. Because no jurisdiction has yet introduced plain unknown. measure breaches trademark law, international For example, Articles 8(1) and 17 of TRIPS both packaging requirements, the research evidence trade agreements and intellectual property rights. provide for member states to adopt measures supporting the measure is speculative. That necessary to protect public health and the public The tobacco industry uses trademarks as a means interest, so long as these measures take account to enable consumers to make judgments about of the legitimate interests of trademark owners. particular brands of cigarettes and to differentiate As a number of public health advocates see it, between them. As such, the industry argues that plain packaging of tobacco (along with mandatory Library publications and key documents trademarks are of significant value to their owners health warnings) is entirely consistent with the goal and the wider economy and must be protected at of promoting consumer welfare and the obligations Australian Government, Australia: the healthiest country by 2020. National Preventative Health Strategy – the both domestic and international levels. of multilateral and regional trade agreements. roadmap for action, Department of Health and Ageing/The Taskforce, Canberra, 2009, http://www.health.gov. Further, they argue that trademark protection is au/internet/preventativehealth/publishing.nsf/Content/nphs-roadmap

Page | 78 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Law, justice and human rights Page | 79 The current interest rate cycle began with a rapid 5.5 per cent for females). Full-time employment Domestic economy overview loosening of monetary policy. The RBA’s cash rate rose by 2.4 per cent in the year to July 2010 to target was slashed between September 2008 and stand at 7.88 million, while part-time employment Scott Kompo-Harms, Economics Section April 2009, from a peak of 7.25 per cent (which grew by 3.3 per cent over the same period to prevailed between March and August 2008), to stand at 3.34 million. Total unemployment fell by a low of 3.00 per cent by April 2009. This was 7.9 per cent in July to around 619 000 persons, maintained until October 2009, when the RBA while the labour force (both the employed and the commenced tightening monetary policy to more unemployed) grew by 2.1 per cent throughout the Economic growth Prices, wages and interest rates ‘normal’ levels. In a series of six gradual moves year to July 2010. between October 2009 and May 2010, the cash The latest economic growth figures were The Consumer Price Index (CPI) increased by rate target was increased to 4.5 per cent, where it Labour demand, as measured by the ABS Job released by the Australian Bureau of Statistics 0.6 per cent in the June quarter 2010 to be remains today. Vacancies series, has softened since May 2008. (ABS) on 1 September 2010. In trend terms, real 3.1 per cent higher throughout the year. The Private sector vacancies have fallen at an average gross domestic product (real GDP) increased prices of ‘tradeables’ (goods that are traded The labour market annual rate of 4.8 per cent in the two years to May by 0.9 per cent through the June quarter to be internationally) rose by 1.0 per cent in the quarter 2010, while public sector vacancies have fallen at 3.2 per cent higher throughout the year to the end to be 1.4 per cent higher through the year to In July 2010, the (trend) unemployment rate an average annual rate of 11.6 per cent over the of June. The various components of real GDP can June. Nontradeables rose by 0.3 per cent in the stood at 5.2 per cent (5.1 per cent for males and same period. Overall, vacancies fell at an average either add to or subtract from growth. Looking at June quarter to be 4.2 per cent higher through 5.3 per cent for females), down from 5.8 per cent rate of 5.5 per cent between May 2008 and May the most significant positive contributors to growth, the year. The measures used by the Reserve in July 2009 (6.1 per cent for males and 2010. out of the 0.9 percentage points of real GDP Bank of Australia (RBA) to gauge what is known Key economic indicators growth in the quarter, household final consumption as ‘underlying’ inflation include the ‘weighted expenditure contributed 0.5 percentage points, median’ and the ‘trimmed mean’. These measures 105 exports of goods and services contributed are designed to strip out some of the short- 0.4 percentage points and public gross fixed term ‘noise’ in the figures. They both rose by 104 capital formation (public investment) contributed 0.5 per cent to be 2.7 per cent higher throughout 0.3 percentage points. The largest detractors from the year, which sits within the RBA’s inflation target growth were imports of goods and services, which of between 2 and 3 per cent per annum. 103 subtracted 0.4 percentage points, while changes in inventories subtracted 0.1 percentage points. Real In addition to the CPI, the ABS also releases 102 GDP per capita (or income per head of population, cost of living indexes for a number of different

a measure of living standards) rose by 0.5 per cent ‘household types’. Specifically, indexes are June 2008 = 100.0 101 in the June quarter and was 1.5 per cent higher produced for employees, age pensioners, throughout the year. other government transfer recipients and self- 100 funded retirees. In the June quarter 2010, other Labour productivity (real GDP per hour worked) government transfer recipients’ cost of living rose by 0.2 per cent to stand 1.2 per cent higher increased by 1.4 per cent, while for employees, 99 over the year. This rather sluggish growth in labour it increased by 1.3 per cent. The cost of living for Jun 08 Sep 08 Dec 08 Mar 09 Jun 09 Sep 09 Dec 09 Mar 10 Jun 10 productivity is at least partially attributable to a self-funded retirees and age pensioners increased Quarter strong rise in hours worked which is the natural by 0.5 per cent. Real GDP CPI Employment consequence of recovery from an economic slowdown. In trend terms, private sector earnings (as Library publications and key documents measured by the Labour Price Index, or LPI) In terms of the composition of national output, the increased by 0.7 per cent in the June quarter 2010, Australian Bureau of Statistics, Australian National accounts: National income, expenditure and product, June strongest performing industries were construction to be 2.7 per cent higher than a year earlier. Public quarter 2010, cat. no. 5206.0, ABS, Canberra, 1 September 2010, http://www.ausstats.abs.gov.au/ausstats/ (which grew by 2.6 per cent); professional, sector earnings rose by 1.0 per cent in the quarter meisubs.nsf/0/2D6DD2723BAA55F8CA257790001DB269/$File/52060_jun%202010.pdf scientific and technical services (2.0 per cent); and 4.0 per cent over the year. Overall, the LPI information media and telecommunications increased by 0.8 per cent in the quarter and 3.0 Australian Bureau of Statistics, Consumer Price Index, June quarter 2010, cat. no. 6401.0, ABS, Canberra, (1.5 per cent) and manufacturing (1.4 per cent). per cent over the year. http://www.ausstats.abs.gov.au/ausstats/meisubs.nsf/0/DB27E14A103FB951CA25776D001B5ADF/$Fil Agriculture, forestry and fishing output fell by e/64010_jun%202010.pdf 2.2 per cent in real terms, arts and recreation services and other services fell by 0.8 per cent Reserve Bank of Australia, Statement on Monetary Policy, RBA, Sydney, August 2010, http://www.rba.gov.au/ each, and accommodation and food services fell publications/smp/2010/aug/pdf/0810.pdf by 0.7 per cent.

Page | 80 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament The nation’s economy Page | 81 during the global recession, its energy and mineral more level playing field with Chinese competitors. Australia, China and the Global Financial needs from Australia increased more rapidly than its economy. Crisis Conclusions

Australian and Chinese investment Australia’s strong economic performance during Michael Priestley, Economics Section the GFC can be attributed to the Government’s Australia and China are important investment stimulus measures, a sound and liquid banking partners and are engaged in significant joint system and not least China’s robust demand for Manufacturing tax break, as well as other stimulus measures to ventures in the mining, resources and energy energy and minerals imported from Australia. stabilise the local car market. sectors. The table below shows the growth in Bilateral trade and investment relations have also The Australian and Chinese manufacturing sectors investment which was sustained despite the global strengthened and are now highly complementary were impacted by the Global Financial Crisis (GFC) financial market instability. In 2009, total Chinese Australia-China trade to each other in the areas of mining and energy. in contrasting ways. In summary, manufacturing investment in Australia was $16.6 billion, making In addition to the expanding trade in energy and has been in relative decline within the Australian Affected by the GFC, Australia’s total merchandise China the 12th largest investor country in Australia. minerals, a future FTA will bring further benefits economy: its share in the economy has been trade decreased by 11.6 per cent in 2009, and Australian investment in China was $6.3 billion in particularly in services trade (which has doubled falling and today stands at 8.5 per cent compared experienced the first fall in exports since 1964–65. 2009, making Australia the 17th largest investor in over the past four years) and agricultural trade. to 12.1 per cent in 2000. By contrast, China’s Exports fell by $27.4 billion or 12.2 per cent to China. China is also a major foreign purchaser of manufacturing base is export oriented and has $196.9 billion from their record peak in 2008 of Australian debt including government securities, been growing rapidly on the back of economic $224.3 billion. Imports fell by $25.5 billion or 11.1 although precise levels are not available. Two Way Investment Relationship—China and Australia, growth rates of 10 per cent annually. Its rapid per cent to $203.2 billion. The fall in the value of A$ million growth has been driven by large investments total merchandise trade cut 0.04 percent off GDP Australia-China free trade agreement From China From Australia in manufacturing facilities and technological the growth rate of 2.3 percent. to Australia to China Total advances achieved by the country. The expansion of two-way trade between Australia Total Inward Outward Investment Stock Investment Stock While trade between Australia and its major trading and China has brought real benefits to Australian Year Manufacturing accounts for 34 per cent of China’s partners fell considerably, trade between Australia households and manufacturing sectors reliant on 2001 3 132 1 885 2002 2 843 1 223 economy and was exposed to the real and and China, increased by 15.6 per cent reaching a cheaper imports. Further benefits are expected 2003 2 989 1 350 immediate economic fallout from the GFC and record of $78.1 billion. Two-way trade grew from with the proposed conclusion of a comprehensive 2004 2 285 1 262 global recession. The decline in US and European $67.6 billion in 2008 to $78.1 billion in 2009. China free trade agreement (FTA) by the end of 2010. 2005 2 274 2 034 economies impacted Chinese manufacturing was Australia’s largest export market surpassing 2006 3 508 3 043 dramatically. Manufacturing exports fell (around Japan. Exports to China accounted for 21.6 per Negotiations for an FTA commenced in 2005 and 2007 6 241 5 789 40 per cent of exports are electronic products), cent of total exports ($42.4 billion) while Australia a precondition to the trade talks was Australia’s 2008 8 517 6 993 production was reduced, as was the demand for was the eighth largest exporter to China. China recognition of China as a full market economy. 2009 16 637 6 327 raw materials and labour. The economic stimulus was also Australia’s largest import source in 2009, Despite a hiatus in negotiations during the global Change in 2009 (%) 95.3 -9.5 package implemented by the Central Government accounting for 17.8 per cent ($35.8 billion) of total recession, both countries remain firmly committed Share in 2009 (%) 0.9 0.6 Rank in 2009 12 17 resulted in a quick turnaround of its manufacturing imports. Driven by demand for resources and to consolidating their relationship by concluding an

economy and contributed to an annual economic energy, the growth of exports far outstripped the FTA. Australia’s approach to the negotiations has Source: ABS, International Investment Position, Cat. No. growth rate of close to 9 per cent. growth in imports into Australia. The balance of been the elimination of tariffs and reduced quotas 5352.0, July 2010 trade swung in favour of Australia which recorded on selected agricultural products. Australia has The GFC impact on Australian manufacturing was a trade surplus with China ($6.6 billion) for the first also sought greater services market access and a much less severe than first feared as the impact of time. the global recession was delayed and the sector’s Library publications and key documents long-term decline continued. A major factor for this Energy and mining decline is the high value of the Australian dollar Allen Consulting Group, The Benefits to Australia households of trade with China, report to the Australia China commencing in 2002 which has led to a long-term China is in the course of urbanisation and rapid Business Council, January 2009, http://www.acbc.com.au/deploycontrol/files/upload/report_household_ deterioration in the competiveness of Australian infrastructure reconstruction and its demand for benefits.pdf manufacturing. The GFC impact was greatest on energy and minerals, especially for these products the automotive industry and particularly in regional from Australia, expanded in 2009. The value of House of Representatives Standing Committee on Infrastructure, Transport, Regional Development and Local areas which recorded the highest rate of job energy and mineral exports to China accounted for Government, The Global Financial Crisis and regional Australia, House of Representatives, November 2009, losses. The industry experienced a sharp decline the bulk of Australia’s merchandise exports (80 per http://www.aph.gov.au/house/committee/itrdlg/financialcrisis/report/GFC%20Final%20Report.pdf in exports and fall in local demand for vehicles as cent) in 2009. In 2007, the value of these exports businesses and households limited spending. In was only 57 per cent of exports. While China’s M Priestley, China’s reliance on Australian LNG exports, Background Note, 2009–10, Parliamentary Library, response the Government introduced a business manufacturing production fell the most on record Canberra, 6 January 2010, http://www.aph.gov.au/Library/pubs/bn/eco/LNG_Exports.pdf

Page | 82 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament The nation’s economy Page | 83 Significant aspects of the Greens’ tax next government to seriously pursue tax reform, Australia’s future tax system policy announcements including a 25 per cent corporate tax rate.

Bernard Pulle, Economics Section The tax policies put forward by the Australian Andrew Wilkie MP–Member for Denison (IND, TAS) Greens include removing tax breaks for high income earners, increasing the top marginal Under the agreement between Mr Wilkie and tax rate to 50 per cent for incomes of $1 million the Prime Minister, Mr Wilkie will be able to or over, increasing the company tax rate to have input to the budget process as well as the Potential reform as a result of the Henry Rudd Government indicated that the other 33 per cent, introducing an estate tax on families development of tax policy with direct access to Taxation Review recommendations in the Report were not part of with assets of $5 million, removing concessional the Prime Minister on a regular basis as well as government policy and would be the subject of arrangements for Capital Gains Tax, and abolishing to the Treasurer, the Minister for Finance, and the The Australia’s Future Tax System Review (the mature debate in the coming years. the Private Health Insurance Rebate. Secretaries of the Treasury and the Department of Review) was established by the Rudd Government Finance and Deregulation. in 2008. The Review handed down its report (the Subsequently, the Gillard Government after Under the agreement between the Greens and the Report) in December 2009, and it was made negotiations with the mining industry announced ALP, the Greens have won the right to be part of Tony Windsor MP–Member for New England (IND, public on 2 May 2010. This article deals generally that it would scale back the minerals resource rent the budget process in the minority government, NSW) with how recommendations in this Report may be tax from 40 per cent recommended in the Report with the Greens Treasury spokesperson and implemented by the Labor minority Government in to 30 per cent. In consequence, the promised Greens Members of Parliament receiving In a media release on 3 May 2010, Mr. Windsor the 43rd Parliament, having regard to the reactions staggered reduction of the company tax rate to economic and financial briefings from the Treasurer expressed the view that the Government’s of the Australian Labor Party (ALP), the Coalition, 28 per cent for all companies was scaled back to and the Minister for Finance. response to the Henry Tax Review, although slow, the Greens and the Independent members to the a reduced company tax rate of 29 per cent from was welcome. recommendations. 2013–14 with no further reduction under current Significant positions on tax policy taken fiscal conditions. Small companies would benefit by the independent Members Concluding comments As stated in the Report’s preface, the Review took from this reduced company tax rate from 2012–13. a long-term perspective and intended the Report Bob Katter MP–Member for Kennedy; (IND, QLD) Following the agreement with the two to be a guide for reform of the tax and transfer Brief overview of the Coalition’s independents, Mr Oakeshott and Mr Windsor system in Australia to meet the challenges from proposals for tax reform Katter’s twenty point wish list provides for on 7 September 2010, the Prime Minister has the economic, social and environmental changes ‘No mining tax’ and the removal of the tax on committed the Labor minority Government to envisaged over the next 40 years. The 138 The Coalition’s Real Action Plan for Lower, Fairer Australian-produced bio-fuels and the introduction convening a public forum of experts on taxation recommendations made in the report are therefore and Simpler Taxes (Coalition Tax Policy) promised of a statutory 10 per cent bio-fuel (ethanol) content before 30 June 2011 to discuss the Henry Review intended to be viewed in the medium to long-term to release all the costings, modelling and other in all petrol rising to 22 per cent (as in Brazil). and its economic and social effects, in order to perspective and not in the short-term context of a data underlying the Review’s recommendations. facilitate a debate on tax reform in the Australian three-year Parliament. This information would be the basis for a fully Robert Oakeshott MP–Member for Lyne; (IND, Parliament. transparent and informed public discussion. The NSW) An overview of the Australian Labor Coalition also promised to cancel the Minerals Party proposals for tax reform Resource Rent Tax and to reduce company tax Oakeshott has indicated his support for the Review to 28.5 per cent from 1 July 2013. However, the recommendation for a 40 per cent resource The Rudd Government’s initial response was Coalition’s revised Paid Parental Leave Policy super profits tax. He has also requested the confined to reform of resource, company and small was to be funded by a levy of 1.5 per cent levy on business taxation as well as superannuation. The companies with a turnover exceeding $5 million. response also indicated that a number of other Library publications and key documents areas considered by the Review, especially making The Coalition Tax Policy document included a tax time simpler, improving incentives to save and list of 25 recommendations which the Coalition K Henry, J Harmer, J Piggott, H Ridout and G Smith, Australia’s future tax system: report to the Treasurer, improving governance and transparency of the tax would not support from the Review. Eighteen of Commonwealth of Australia, December 2009, http://www.taxreview.treasury.gov.au/content/downloads/final_ system, would receive attention in the short term. these were the same as the ALP’s list. However, report_part_1/00_AFTS_final_report_consolidated.pdf the Coalition policy does not rule out indexing fuel The initial response was accompanied by a tax to the CPI. The additional recommendations Liberal Party of Australia, The Coalition’s real action plan for lower, fairer and simpler taxes, 2010 election list of 19 recommendations from the Report ruled out by the Coalition included new taxes on policy, 2010, http://parlinfo/parlInfo/download/library/partypol/2DMX6/upload_binary/2dmx60.pdf which the Rudd Government stated they would business activity, scrapping the private health not implement. This list included removing insurance rebate, means testing the Child Care K Rudd (Prime Minister) and W Swan (Treasurer), Stronger, fairer, simpler: a tax plan for our future, media the Medicare levy, introducing a bequests Rebate, and new taxes on Australians driving to release, 2 May 2010, http://ministers.treasury.gov.au/DisplayDocs.aspx?doc=pressreleases/2010/028.htm&pa tax, and abolishing the luxury car tax. The work. geID=003&min=wms&Year=&DocType

Page | 84 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament The nation’s economy Page | 85 International comparisons of national debt

Guy Woods, Statistics and Mapping Section General government net debt 2010

Denmark 3.1 AUSTRALIA (a) 3.2 New Zealand 3.3 Poland 26.6 Introduction Comparisons Canada 32.2 Turkey 36.9 Around the world the budgetary response to the The IMF data shows that Australia has the lowest Switzerland 38.3 Global Financial Crisis (GFC) has significantly level of gross debt, after Chile, when compared Mexico 38.8 increased the level of government debt. with other member states in the Organisation of Netherlands 46 Economic Development and Co-operation (OECD). Ireland 47.8 The economic recession the GFC precipitated In terms of net debt, only Chile, Denmark, New Spain 57.5 Austria 60.5 has reduced government revenues. For example, Zealand, Norway and Sweden have lower levels. United States 66.2 in Australia, Treasury cut its forward estimate for Germany 68.6 taxation revenue in the 2008–09 budget by $110 Over the course of the GFC Australia’s net debt Hungary 71.4 billion in the latest budget. position went from a low of minus 3.8 per cent United Kingdom 71.6 of GDP in 2007–08 to a projected high of 6.0 per Israel 72.8 At the same time, the state take-over of collapsing cent in 2012–13. In comparisons, the average in France 74.5 financial institutions, increases in welfare payments the G7 countries (Canada, France, Germany, Italy, G7 77.1 Iceland to the unemployed and economic stimulus Japan, United Kingdom and United States) went 77.2 Portugal 82.2 packages have increased the expenditure side of from a low of 53.0 per cent in 2007 to projected Belgium 91.9 the ledger. This has brought about an increase in 94.2 per cent in 2015. By 2015, Japan’s net debt Italy 116 public debt levels not seen in some countries since is projected to reach 154.7 per cent of GDP, Japan 121.6 the 1940s. America’s 85.5 per cent and the United Kingdom’s 0 10 20 30 40 50 60 70 80 90 100 110 120 130 83.9 per cent. Percentage of GDP Measuring debt Implications In terms of measuring public debt (sometimes Excludes Norway, Sweden and Chile which have negative net debt. referred to as national debt) there are two key The IMF is urging the high public debt developed (a) Australia refers to financial year 2009–10. Figures from 11 May Budget. indicators that analysts focus on. The first is gross nations to reduce their net debt to levels of 60 per Sources: International Monetary Fund, Fiscal monitor: navigating the fiscal challenges ahead, 14 May 2010; and Treasury, Budget strategy and outlook, Budget paper no. 1, 2010–11. debt, which is, essentially, the sum of all interest cent of GDP. Without this fiscal adjustment it has bearing loans with a specified repayment date. warned that they face adverse macroeconomic In Australia this is mostly government securities consequences. IMF research has found that if on issue. The other measure is net debt, which the G7 countries do not take measures to rein in is gross debt less financial assets, such as the their debt levels their interest rates could rise by Library publications and key documents holdings in the Australian Future Fund. These two percentage points and potential growth could measures are usually expressed as a percentage be half a per cent lower. This could also have a Australian Government, Budget strategy and outlook, Budget paper no. 1, 2010-11, Commonwealth of of gross domestic product (GDP). detrimental impact on the world economy and Australia, Canberra, 2010. affect even low debt countries such as Australia. International comparisons usually focus on C Cottarelli and A Schaechter, Long term trends in public finances in the G-7 economies, International gross debt as this is easier to calculate on a Conclusions Monetary Fund (IMF) staff position note no. SPN/1013, September 1 2010, Washington, 2010, p. 13 – 14, comparative basis. A comparison of net debt is viewed 6 September 2010, http://www.imf.org/external/pubs/ft/spn/2010/spn1013.pdf much harder due to the way different governments In sum, Australia has negligible levels of debt (see define financial assets. However, analysts at graph) which pose little threat to the country’s International Monetary Fund (IMF), Fiscal monitor: Navigating the fiscal challenges ahead, 4 May 2010, IMF, the International Monetary (IMF) have recently economic outlook. However, Australia could be Washington, 2010, http://www.imf.org/external/pubs/ft/fm/2010/fm1001.pdf calculated estimates for both these indicators for affected by the international implications posed by a wide range of countries. It should be noted that the G7. S Kompo-Harms, Commonwealth, state territory gross and net debt 1998–99 to 2012–13, Background most countries in the IMF survey include debt from note, 7 April 2010, Parliamentary Library, Canberra, 2010, http://www.aph.gov.au/Library/pubs/BN/eco/ all levels of government, whereas the Australian GrossAndNetDebt.pdf data only looks at central government debt.

Page | 86 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament The nation’s economy Page | 87 • there are no guarantees that emissions will objective to achieve. To date emissions taxes Emissions taxes decline if consumption of the goods and have not received much support as the services that produce emissions remains internationally preferred method of controlling Leslie Nielson, Economics Section relatively unresponsive to price increases (that greenhouse gas emissions. The international is, price-inelastic) community appears to prefer the cap-and-trade • the level at which the tax is set to produce the approach best outcomes cannot be known in advance. • they are potentially regressive. The impact of Thus the tax may have to go through several a flat carbon tax will be highest on the lowest Introduction Advantages changes before having the desired effect. This income households. This effect is offset to makes it politically vulnerable, restricting the some degree by the higher consumption of The Garnaut Climate Change Review favoured Environmental taxes have been argued to have the capacity for the best tax level to be found wealthier households and the establishment of a broadly applied carbon following advantages: • if the tax is set at too high a level, activities that • they are a tax, and therefore are politically tax in preference to a heavily compromised are particularly sensitive to it may relocate to a unpopular by their very nature. emissions trading scheme. Further, it proposed • they are predictable in their costs. Relatively location that does not have such imposts the introduction of a carbon tax as an interim stable price signals can help business and • depending on how the tax is applied, it may The nature of climate change impacts measure pending the establishment of an effective consumers plan energy spending and provide lock a firm into one particular emissions and long-term effectiveness emissions trading scheme. The Australian Greens greater certainty for investments in energy reduction method simply to reduce the tax in particular support this approach. efficiency that have large initial costs imposed, rather than the environmental harm Emissions taxes should be set at a level equal to • they create a permanent and stable incentive to occurring. For example, a tax on firms that do the external cost of the good or service provided. What are emissions taxes? adopt a least-cost way of reducing emissions not use smokestack scrubbers may only lead Not only is this hard to calculate accurately, and continued technical innovation to the increased use of such devices. It will not but there is the significant possibility that this The Organisation for Economic Co-operation and • their effect is not susceptible to ‘strategic’ lead to fuel substitution or better combustion cost might rapidly increase. The progression of Development (OECD) defines environmentally behavior by firms and non-government processes expected climate change impacts is not linear; related taxes as any compulsory, unrequited organisations that could potentially distort an • effective emissions reductions require effective rather, impacts may become increasingly severe. payment to government, levied on tax-bases emissions trading market international action. The reality of widely This means that the external cost of greenhouse deemed to be of particular environmental • they put a limit on the costs of emissions differing and volatile exchange rates and gas emissions will increase. This rate of increase relevance. The relevant tax-bases include energy reduction differing administrative capacities makes a may well be at a faster rate than any tax can be products, motor vehicles, waste, measured or • they can be implemented relatively quickly and co-ordinated and effective set of emissions adjusted to match. estimated emissions, and natural resources. For are comparatively simple to administer taxes on an international scale a difficult example, a surcharge may be placed on every litre • they are efficient in that they are transparent, of petrol sold. Taxes are unrequited in the sense simple and can have a wide coverage and that benefits provided by government to taxpayers • they are a revenue source. To ensure that are not normally in proportion to the tax payments. the introduction of an emissions tax remains In theory, environmentally related taxes should be revenue-neutral other taxes can be reduced, set at a level equal to the ‘external’ environmental or the proceeds of the carbon tax redirected to cost of a particular product or activity such as air those most affected. or noise pollution. Disadvantages Where are they used? Emissions taxes as a means of controlling Such taxes are extensively used in Europe, mainly greenhouse gas emissions also have some in the transport and energy sectors. They are disadvantages: suitable for situations where direct emissions are difficult to monitor, or administrative simplicity is • while emissions taxes work well in conditions a highly desirable policy feature (say where the of certainty, they are less effective in conditions administrative capacity of a government is very low where the response to a tax on emissions is in relation to an economy as a whole or in relation unknown, which leads to a lack of certainty to a particular sector). The Nordic countries are the over the amount of emissions reduction most consistent users of environmental taxes. Library publications and key documents

L Nielson, Emissions control: your policy choices, Background note, Parliamentary Library, Canberra, 10 May 2010, http://www.aph.gov.au/library/pubs/BN/eco/EmisisonsControl.pdf

Page | 88 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament The nation’s economy Page | 89 and Cooperation and holding the first US–ASEAN initially convene once every three years and will Australia’s regional engagements in East Asia multilateral leaders meeting in 2009 (with a second need to reach agreement on cooperation agendas. meeting to be held in New York in September As it develops, the Defence Ministers Meeting and the Asia Pacific 2010). It also declared an interest in joining the could facilitate useful cooperation in areas such as East Asia Summit. In this climate of reassessment humanitarian and disaster relief as well as security Dr Frank Frost, Foreign Affairs, Defence and Security Section and change, ASEAN is moving to adapt its policy dialogue. There is also a pressing need cooperation efforts in two potentially important for improved communication among the defence ways—and Australia will be involved in both. forces of highly armed states, including the US and Successive Australian governments have placed Cooperation efforts are continuing at a time China. heavy emphasis on the development of both of dynamic change. China’s rapid growth is Firstly, ASEAN has invited the US and Russia to bilateral relations and multilateral engagements in enhancing its international and regional influence, join the East Asia Summit. The EAS has evolved The character of the next phase in regional East Asia and the wider Asia Pacific regions. Most in economic, political and security terms. While cautiously since 2005 as a forum for leadership cooperation is still emerging and further recently, the Rudd Government in 2009 signed China’s dynamism is fuelling growth across the dialogue and broad declarations of purpose, but changes to institutional arrangements may well the ASEAN-Australia-New Zealand Free Trade Asia Pacific, its rising profile and ongoing defence its profile may rise. An expanded EAS would occur. Nonetheless, if the two new ASEAN- Agreement (following negotiations since 2004), modernisation programs have directed attention include all the major powers with interests in East sponsored dialogues of ‘the eighteen’ develop gained Australian entry in 2009 to the Asia-Europe towards its future potential policy directions, for Asia. Secretary of State Clinton declared on 23 momentum, they can provide significant venues Meetings (ASEM, a dialogue inaugurated in 1996 example, in the contested areas of the South China July 2010 in Hanoi that the US ‘... will be working for cooperation on security and other issues at between Asian states and the European Union Sea, and towards the vital need for constructive with EAS members to encourage its development head of government/state and defence minister to advance inter-regional ties, now involving 49 relations among all regional parties. The changing into a foundational security and political institution levels. Australia will have a valuable opportunity participants, which Australia will begin attending regional environment is encouraging states to for Asia in this century’. It is now expected that to play a role in helping to establish priorities and in October 2010), and promoted discussions seek institutions which can include the Asia Pacific the US (along with Russia) will gain entry and agendas for constructive dialogue and cooperation on an ‘Asia Pacific community’. Some further major powers (China, Japan, India and the US) to that President Obama will attend his first annual programs. developments in regional engagement are now bolster cooperation, help ameliorate potentially Summit in Jakarta in 2011. underway. dangerous rivalries and avoid conflict. Discussion has accordingly continued on how institutions and Secondly, on 12 October 2010 in Hanoi, ASEAN Regional cooperation in East Asia and the Asia processes can best be enhanced to meet these will host the first ASEAN Defence Ministers Pacific has confronted many obstacles, including needs. Meeting Plus Eight. This will bring together the the great diversity of peoples and countries, deep- same 18 states which will be members of an seated rivalries (for example, Japan and China) Prime Minister Kevin Rudd sought to add to expanded EAS, and it will be the first such forum and a preference for informality rather than rules- these discussions in a speech on 4 June 2008 specifically for defence ministers. The Meeting will based institutions. Multilateral cooperation has when he declared that the Asia Pacific region nonetheless enhanced security and development needed an institution with wide membership ‘… in the past four decades, especially in Southeast able to engage in the full spectrum of dialogue, Asia. ASEAN (the Association of Southeast Asian cooperation and action on economic and political Nations) is deepening its own integration and has matters and future challenges related to security’, developed forums to coordinate its ten members to achieve an ‘Asia Pacific community’ by 2020. with Japan, China and South Korea in the ‘ASEAN The proposal met with a mixed response, with Library publications and key documents Plus Three’ process. It also meets at a leadership support accompanied by criticism, particularly level with those 13 states along with India, Australia from some ASEAN countries (notably Singapore) Ralf Emmers and John Ravenhill, The Asian and global financial crises: consequences for East Asian and New Zealand in the East Asia Summit (EAS), on the basis that it appeared to challenge ASEAN’s regionalism, RSIS Working Paper no. 208, S. Rajaratnam School of International Studies, Singapore, 16 August and has sponsored security dialogue in the much role at the centre of cooperation efforts and that 2010, http://www.rsis.edu.sg/publications/WorkingPapers/WP208.pdf larger 27 member ASEAN Regional Forum (ARF). emphasis should remain on developing existing Alongside these groups, the Asia Pacific Economic forums. The Government in response emphasised Frank Frost, Australia’s proposal for an ‘Asia Pacific Community’: Issues and prospects, Research paper, Cooperation (APEC) forum has pursued many its recognition of ASEAN’s crucial role in regional no. 13, 2009–10, Parliamentary Library, Canberra,2009, http://www.aph.gov.au/library/pubs/rp/2009- areas of economic and functional cooperation cooperation, including its efforts to encourage 10/10rp13.pdf with a diverse membership spanning the Asia the US and Russia to deepen their involvement in Pacific and an annual leaders’ meeting. These evolving regional architecture. Zhu Liqun, Tan Seng Chye, Prapat Thepchatree and Anthony Milner, ‘Regionalism—an Asian conversation: and a number of other groupings have all made Three Viewpoints’, The Asialink Essays, vol. 2, no. 4, 2010, http://www.asialink.unimelb.edu.au/__data/assets/ contributions. However, different states gather Since 2009, other developments have encouraged pdf_file/0006/30489/Regionalism_An_Asian_Conversation29-6-2010.pdf in different forums, which operate in parallel and institutional adaptation. In significant policy moves, sometimes overlap. the Obama Administration has upgraded US ties Carlyle A. Thayer, Southeast Asia: patterns of security cooperation, ASPI Strategy Report, Australian Strategic with ASEAN by signing ASEAN’s Treaty of Amity Policy Institute, Canberra, September 2010 (forthcoming).

Page | 90 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Australia in the world Page | 91 Where to from here? of the issue. As a result of the post-election Australian Defence Force in Afghanistan agreement between the government and the The Minister for Defence has stated that Australia Australian Greens, this seems likely to occur early David Watt, Foreign Affairs, Defence and Security Section hopes to transfer control of the security situation during the first sitting of the new parliament. in Uruzgan to the ANA in two to four years. During the July 2010 International Conference on Questions continue to be raised about Australia’s Afghanistan in Kabul, countries contributing to the involvement in Afghanistan. Are our stated reasons ISAF endorsed the Afghan Government’s plan to for being there sufficient to justify the ongoing take control of its own security by 2014. However, casualties and the substantial financial cost? This Australia in Afghanistan the Dutch to continue in their role of senior partner this timetable is dependent on the ANA and has become an increasingly significant question in the province. Afghan National Police being sufficiently trained in light of the long-standing criticism by some Currently, Australia’s largest international military and capable of accepting responsibility for the commentators that denying jihadist terrorists a commitment comprises approximately 1550 ADF The Dutch withdrawal also led to concerns security of Uruzgan. base in Afghanistan will not significantly affect their personnel deployed to Afghanistan as part of about who would take the lead role in Uruzgan, capacity to operate. This is coupled with growing Operation Slipper. This is Australia’s contribution something Australia was unwilling to do. The United Nations Assistance Mission in Afghanistan skepticism about the international community’s to the NATO-led International Security Assistance announcement by the Minister for Defence in June (UNAMA) figures indicate that 7324 civilians have ability to deliver a stable security infrastructure for Force (ISAF). The main focus of ADF activities in 2010 that Australia would become part of a US-led been killed as a result of fighting between the Afghanistan by 2014 and ongoing concerns about Afghanistan is the mentoring and training of the multi-national command structure (Combined beginning of 2007 and the end of June 2010 corruption at many levels throughout the Afghan Afghan National Army (ANA) and the provision Team Uruzgan, CTU) provided some certainty (accurate figures are impossible to provide for the governance structure. Equally, if we accept that of protection for military and civilian personnel about the future of our role in the province. early years of the conflict). Approximately three Australian troops should continue their involvement involved in reconstruction activities. quarters of these deaths were caused by anti- in Afghanistan, there is the question of whether The CTU continues to operate as part of the ISAF. government forces. Australia’s commitment is sufficient to complete During April 2010 Australia announced that it While the number of Australian military personnel the task. would increase its civilian personnel numbers remains steady at approximately 1550 personnel As at mid-September 2010, Australia has suffered in Afghanistan from 25 to approximately 50. An and Australia continues to mentor and train the 21 combat deaths since the war began in 2001 Perhaps most importantly, when Australia does Australian civilian is the head of the Uruzgan ANA 4th Brigade under these arrangements, and spent $6.1 billion on its military presence in withdraw, there will need to be agreed criteria Provincial Reconstruction Team (PRT) and there Australia’s troops now have an increased role in Afghanistan. The ongoing support from both the by which to judge the success or failure of the are personnel from AusAID, the Australian Federal the protection of civilian personnel. In addition to ALP and the Coalition for Australia’s continued mission. Police (AFP) and the Department of Foreign Affairs this, the April 2010 dispatch of a further six AFP deployment has meant that, with the exception and Trade in Uruzgan. officers to Uruzgan to assist with the training of the of the Defence Minister’s regular statements to Afghan National Police brought the total number of the Parliament, there has been relatively little Background Australian police officers to 28. parliamentary debate on the war. However, the mid-2010 spike in casualties has led to an increase Australia first committed military personnel Why we are in Afghanistan in calls for deeper parliamentary consideration to Afghanistan in October 2001 after the 11 September attacks on the World Trade Centre. Australia has always justified involvement in Library publications and key documents Prime Minister John Howard invoked Article VI Afghanistan by stressing that our own national of the ANZUS Treaty in support of Australia’s security is greatly enhanced by denying al-Qaeda N Brangwin, Australia’s military involvement in Afghanistan since 2001: a chronology, Background Note, involvement—the only time the Treaty has been and other jihadist groups a haven, and that this 2010–11, Parliamentary Library, Canberra, 16 July 2010. http://www.aph.gov.au/Library/pubs/bn/fads/ invoked. The Australian Parliament supported the is best done by helping to build a more secure MilitaryInvolvement_Afghanistan.pdf commitment on 17 September 2001. and democratic Afghanistan. As the Minister for Defence said in his June 2010 statement to J Faulkner, Ministerial Statement: Afghanistan, Senate, Debates, p. 4183, 23 June 2010, 2010,http://parlinfo. Between 2006 and August 2010 Australia worked Parliament: aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22chamber%2Fhansards%2F2010-06- in partnership with the Netherlands in Uruzgan. 23%2F0207%22 Mutual agreement about the emphasis placed Our fundamental objective in Afghanistan is to on mentoring and reconstruction activities and combat a clear threat from international terrorism P Katel, ‘America at war: can withdrawal from Afghanistan begin next July?’, CQ Researcher, vol. 20, no. 6, the high regard for the Dutch military made this to both international security and our own national 23 July 2010, pp. 605–628, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22libr a positive relationship. Therefore, the withdrawal security. Australia cannot afford, and Australians ary%2Fjrnart%2F5UEX6%22 by the Netherlands of its military forces during cannot afford, to let Afghanistan again become August 2010 (acting on an earlier decision) was a safe haven and training ground for terrorist R Khosa, ‘Australia’s commitment in Afghanistan: moving to a more comprehensive approach’, Policy Analysis, not particularly welcomed by Australia, which organisations .... Australian Strategic Policy Institute, 31 August 2010. http://www.aspi.org.au/publications/publication_details. stressed, on more than one occasion, its desire for aspx?ContentID=265&pubtype=9

Page | 92 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Australia in the world Page | 93 • Preparedness and Personnel and Operating How should success be measured? The Defence Strategic Reform Program (SRP) Costs (increasing understanding of the cost of preparedness for military operations, including Mechanisms have been set up by Defence to Laura Rayner, Foreign Affairs, Defence and Security Section the costs of readiness and sustainability) keep track of the SRP’s progress (e.g. an advisory • Output Focused Budget Model (improving board, and regular monitoring). However, the accountability and management of resources, success of the SRP could be difficult to gauge, including improved visibility of the cost of goods especially for those outside Defence. Over half and services) of the initiatives are not targeting direct cost Genesis and aims The Savings Streams and their targets • Intelligence Human Resources (HR) and reductions, but aim to promote a cost-conscious Information Communications Technology (ICT) and business-like cultural change across the The next Senate Estimates Committee hearings on The Savings Streams and their gross savings (consolidating the management of HR and ICT Defence organisation. There is also little indication the 2010–11 Defence Budget will be an opportunity targets, are listed in the April 2010 publication. across the Intelligence and Security Group by on the public record of how any actual cost for the Parliament to examine the progress made These figures differ, sometimes markedly, from the providing scope for centralisation, integration reductions will be measured or reported over the during the first year of the Defence Strategic original 2009 estimates, and one particular 2009 and collaboration) next decade, and no guarantee that the method Reform Program (SRP). The aim of the SRP is to stream, Inventory ($0.71 billion), is no longer listed • Estate (improving management of contracts used will remain consistent and thus allow valid reform Defence business processes and practices separately. and service delivery), and comparison. According to the Australian Strategic over the next decade, allowing resulting savings to • Science and Technology (‘future proofing’ Policy Institute’s 2010–11 Defence budget brief, Savings Streams ($ billion) be reinvested within the Defence portfolio. Defence by ensuring that its science and The cost of Defence, the success or otherwise of

Defence Savings Program technology capabilities match its future needs). previous Defence programs in increasing efficiency (categories previously The SRP was introduced in 2009 as a key element identi ed under the Minister’s and reducing costs has not been easy to measure savings program), 6.0 in the Rudd Labor Government’s financial plan Progress or possible to verify. to fund the objectives of its 2009 Defence White Smart Sustainment Paper, Defending Australia in the Asia Pacific previously Smart In evidence to a Senate Budget Estimates hearing Maintenance, 5.5 Parliamentary accountability century: Force 2030. The May 2009 publication on 31 May 2010, the Secretary of the Department Non-Equipment which outlined the SRP, The Strategic Reform Procurement, 3.8 of Defence stated that Defence was ‘on track Given the vital importance of the SRP to

Program 2009: delivering Force 2030, lists its three Workforce and to deliver the $797 million in cost reductions future defence planning, and the scope, scale key elements: improved accountability, improved Shared Services, 2.8 programmed for this year’, and ‘well placed to and complexity of the program, the new planning, and enhanced productivity. Information,Communications achieve the target of around $1 billion in cost parliament could expect that Defence would be and Technology,1.9 reductions for 2010–11’. In his evidence, the ready to provide it with easily accessible and The aims of the SRP include $20.6 billion in Logistics, 0.35 Secretary listed three cost reductions making up comprehensive information on the progress of the

gross savings (cost reductions) to help fund Reserves, 0.36 $484 million of the $797 million target for 2009–10: SRP. This information should be made available Defence’s planned capital investment and to $263 million for Smart Sustainment; $172 million to the parliament and its relevant committees in remediate previously underfunded areas. Defence for non-equipment procurement cost reductions sufficient detail, and with sufficient clarity and estimates that reform implementation will cost The Non-Savings Streams (e.g. travel and training); and $49 million for frequency to enable parliament and taxpayers $2.404 billion, resulting in a planned net saving of communications technology. to be assured that Defence is achieving its SRP $18.258 billion by 2018–19. On its SRP webpage, The Non-Savings Streams aim for more efficiency targets. Defence candidly states that if it does not achieve and effectiveness rather than for direct cost the reforms set out in the SRP, it will not be able reductions. They are described in detail in the to ‘deliver the organisation that can deliver and 2009 and 2010 documents, as well as in the Library publications and key documents sustain Force 2030’. information sheets on the SRP webpage: Department of Defence, The Strategic Reform Program 2009: delivering Force 2030, Department of Defence, The SRP, which is now in its implementation • Strategy and Planning (establishing a five yearly Canberra, 2009, http://www.defence.gov.au/publications/reformBooklet.pdf phase, is a complex and ambitious program. In Defence White Paper cycle and a strengthened an April 2010 publication, The Strategic Reform Defence Planning Guidance process) Department of Defence, The Strategic Reform Program: making it happen, Department of Defence, Program: making it happen, Defence estimates • Capability Development Process (providing a Canberra, [April] 2010, http://www.defence.gov.au/srp/docs/srp.pdf that it will take between two and four years for the more informed basis for government decisions benefits, cost reductions and savings opportunities and streamlining the decision making process) Parliamentary Library, Budget Review 2010–11, Research paper, no. 17, 2009–10, Parliamentary Library, of the SRP’s 15 reform streams, and the more than • Procurement and Sustainment (Mortimer Canberra, 2010, http://www.aph.gov.au/library/pubs/RP/BudgetReview2010–11/DefenceSRP.htm 300 associated initiatives, to ‘fully mature’. Review) (imposing commercial discipline on procurement and sustainment processes, and M Thomson, ‘Chapter 5–Strategic Reform Program’ The cost of Defence: ASPI Defence Budget brief making the Defence Materiel Organisation more 2010 –11, Australian Strategic Policy Institute, Canberra, 2010, pp. 131–158, http://dpl/Ejournals/ASPI_ business-like) TheCostOfDefence/2010-2011.pdf

Page | 94 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Australia in the world Page | 95 cooperation with Indonesia and other countries accommodation was also made available to Refugees: Australia’s humanitarian response in the region and to creating harsher mandatory vulnerable detainees such as families and penalties for those convicted of people smuggling unaccompanied minors. Upon forming government Elibritt Karlsen, Law and Bills Digest Section offences. Some commentators though have in 2007, Labor declared that it was committed to Janet Phillips, Social Policy Section criticised the introduction of tougher penalties on treating asylum seekers more humanely. To this the basis that they do not effectively target people end, it removed the statutory obligation to charge smuggling syndicates—rather, they simply punish detainees for the cost of their detention and the often unsuspecting Indonesian fishermen who announced a series of detention values that the operate the boats. Department of Immigration would follow. These How is Australia responding to the global overseas who have close ties to Australia. Visa values emphasised a risk-based approach to the challenge? grants for refugees within Australia (boat and management of detainees and thus, in principle, Can mandatory detention withstand the air arrivals combined) only make up a relatively test of time? detention centres would only be used as a last Increasing numbers of asylum seekers and small proportion of the total number of refugees resort and for the shortest practicable time. others in need of humanitarian assistance pose accepted by Australia each year—usually in the The policy of mandatory detention (that is the However, some commentators have criticised huge challenges for the world’s destination region of 17 to 20 per cent. legal requirement to detain all non-citizens that the Government’s recent decision to temporarily countries. Australia is one of only about 20 do not hold a valid visa) was introduced in the suspend the processing of asylum seekers from nations worldwide responding to these challenges Irregular arrivals—what is the solution? early 1990s. Although it does vary, the majority of Sri Lanka and Afghanistan on the basis that it through participation in the United Nations the detention population is usually comprised of has led to their indefinite detention. Despite the refugee agency’s resettlement program which Over the last decade, the immigration debate in people who have overstayed their visa or breached fact that the Australian Greens and certain former involves accepting a set number of refugees on an Australia has been largely overshadowed by the their visa conditions. However, the detention of members of the Coalition have strongly advocated annual basis. However, the UN refugee agency’s issue of asylum seekers arriving by boat (irregular asylum seekers in often remote locations has for the introduction of a periodic independent resettlement program currently contributes to arrivals). The issue took centre stage in the 2001 received greater public attention. In particular, review by a tribunal or court of the ongoing need resettling only a small proportion of the world’s federal election when former Prime Minister John the duration and conditions of their detention for detention, neither major party has introduced refugees and about 75 to 90 per cent of refugees Howard asserted ‘we’ll decide who comes to this have been controversial issues that have plagued such a mechanism. remain in their region of origin, placing the burden country and the circumstances under which they’ll successive governments. on neighbouring developing countries. come’. A widespread perception in the community A new government will inevitably need to address that Australia is being swamped by undocumented Though the policy of mandatory detention has the enduring and complex problems associated Australia has a highly managed migration system asylum seekers continues to strongly influence officially remained, it has been somewhat relaxed with an expanding detention population. The and formally accepts around 13 000 refugees government policy. Successive governments have in recent years. For instance, in 2005 the former issue of providing additional and appropriate and other humanitarian entrants each year under been under constant pressure to adopt effective Coalition Government affirmed in legislation the accommodation to avoid overcrowding and a its Humanitarian Program. The majority of these measures to address border security and combat principle that detention of minors would only deterioration of conditions will be a significant grants each year go to refugees referred by the people smuggling. This continues to be an emotive occur as a measure of last resort. Alternative challenge. UN or to people subject to human rights abuses and divisive election issue, the 2010 federal election being no exception. Number of places available for refugees Submitted for resettlement by UNHCR The Labor Government consistently maintained Ten top resettlement countries 2008 that irregular migration is a global challenge linked Country Number of places directly to ‘push factors’ such as conflict and Library publications and key documents United States of America 56 750 displacement within the region. In contrast, the Australia 6 500 Coalition attributed the recent increase in irregular E Karlsen, J Phillips, and E Koleth, Seeking asylum: Australia’s humanitarian response to a global challenge, Canada 6 140 boat arrivals to ‘pull factors’ driven predominantly Background note, Parliamentary Library, Canberra, 2010, http://www.aph.gov.au/library/pubs/BN/sp/ Sweden 1 900 by domestic reform—most notably, Labor’s SeekingAsylum.pdf Norway 1 200 decision in 2008 to grant refugees permanent Finland 750 residency and discontinue processing of asylum J Phillips, Asylum seekers and refugees: what are the facts?, Background note, Parliamentary Library, New Zealand 750 Canberra, 2010, http://www.aph.gov.au/library/pubs/BN/sp/AsylumFacts.pdf United Kingdom 750 seekers in the small Pacific island State of Nauru. Denmark 500 However, prior to the 2010 federal election Labor Netherlands 500 announced that it too was exploring options for J Phillips and H Spinks, Boat arrivals in Australia since 1976, Background note, Parliamentary Library, Others 1 000 creating a regional processing centre in a foreign Canberra, 2010, http://www.aph.gov.au/library/pubs/BN/sp/BoatArrivals.pdf Total 76 740 country. Both sides of politics agree that people smuggling is an unacceptable organised criminal E Karlsen, Complementary protection for asylum seekers—overview of the international and Australian legal Source: UNHCR, Frequently asked questions about resettlement, activity that endangers innocent people’s lives. frameworks, Research paper, no. 7, 2009–10, Parliamentary Library, Canberra, 2009, http://www.aph.gov.au/ UNHCR website, http://www.unhcr.org/4ac0873d6.html Both have accordingly committed to increased library/pubs/rp/2009-10/10rp07.pdf

Page | 96 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Australia in the world Page | 97 Lastly, on 21 August 2010 Russian engineers autonomous sanctions on the nuclear industry in The Iranian nuclear program began to load fuel into the Bushehr nuclear reactor Iran which go further than the UNSC sanctions. in southern Iran. As Bushehr builds capacity it These autonomous sanctions currently include, Marty Harris, Foreign Affairs, Defence and Security Section will become the country’s first large-scale nuclear above and beyond the UNSC sanctions: reactor. Russia, which built the plant, will supply the low-enriched uranium fuel and remove the • travel and financial restrictions on approximately spent reactor fuel for reprocessing. As such, the 33 individuals involved in Iran’s nuclear or proliferation threat posed by the reactor may be ballistic missile program Background The IAEA, which had postponed judgement on limited. Still, in the context of heightened tension • targeted financial sanctions on approximately Iran’s nuclear program while that country was over the Iranian nuclear program, developments at 118 entities with links to Iran’s nuclear or The Iranian nuclear program became a central negotiating with the EU-3, ruled in September Bushehr will be watched closely. ballistic missile program issue for the international community following the 2005 that Iran’s activities constituted ‘non • restrictions on Australian firms conducting disclosure of two previously unreported nuclear compliance’ with the Nuclear Non-proliferation Main Iranian nuclear facilities business with proliferation-sensitive sectors facilities in August 2002. The two facilities—a Treaty and the associated Safeguards Agreement. in Iran (such as uranium mining; also includes uranium enrichment plant at Natanz and a heavy In February 2006 the IAEA voted in favour of some oil and gas sector entities), and water reactor at Arak—both have possible nuclear referring Iran to the UNSC, and Security Council • prohibitions on the sale of certain—mostly weapons applications. sanctions were applied under Resolution 1737 military or dual-use use—goods and services (2006), and passed on 27 December 2006. • Tehran to Iran. The negotiations between Iran and key Western • Qom countries which began in August 2002 have Since December 2006 the UNSC has imposed a Arak • Further, the Australian Government introduced the • Natanz failed to produce a long-term solution. Following further three rounds of sanctions on Iran, which • Esfahan Autonomous Sanctions Bill 2010 into parliament on negotiations with the so-called ‘EU-3’—France, focus on restricting the sale of dual-use nuclear or 26 May 2010. This piece of legislation would give Germany and the UK—in October 2003, Iran military equipment to Iran, and travel and financial the Government greater flexibility in the range of agreed to suspend all uranium enrichment sanctions against designated persons/entities autonomous measures Australia could impose on activity. In return, the EU-3 acknowledged Iran’s engaged in the nuclear program. • Bushehr countries like Iran. ‘nuclear rights’ and promised to supply Iran with modern technology once it had provided sufficient Recent developments When the House of Representatives was dissolved assurances to the international community on 19 July 2010, the Bill was still before the House regarding the nature of its nuclear program. In September 2009 Iran informed the IAEA of Australia’s involvement of Representatives. Considering that both major a second uranium enrichment facility under parties indicated support for it, the Bill may be The suspension of enrichment activity lasted until construction near the city of Qom. The US, Britain Successive Australian governments have voiced reintroduced soon after parliament returns. June 2005, when, after the election of President and France issued a joint statement arguing that their opposition to the Iranian nuclear program Mahmoud Ahmadinejad, Iran resumed uranium the disclosure of the previously secret facility since secret facilities were disclosed in 2002. In addition, the parliament may also be required enrichment. ‘deepens a growing concern’ about Iran’s nuclear to respond to other developments concerning program. Iran claimed, however, that it was not Australia implements all four sets of UNSC the Iranian nuclear program, such as further At about the same time the EU-3 offered Iran required to inform the IAEA of new facilities until sanctions on Iran. In addition, since October international sanctions or a military strike on Iran’s a final package of ‘benefits’ in return for a six months before nuclear fuel is introduced. 2008, Australia has progressively applied a set of nuclear facilities. permanent cessation of uranium enrichment and The IAEA, for its part, stated that ‘Iran’s delay in other activities associated with possible nuclear submitting such information to the Agency does weapon applications. In addition to unpublished not contribute to the building of confidence’. economic and political incentives, Iran was to be provided with a guaranteed supply of nuclear fuel Soon after this revelation, Iran attended Library publications and key documents and assurances of ‘non aggression’ from the EU negotiations with the ‘P5+1’—representatives (but not the US). Iran rejected this offer, with an from the permanent members of the UNSC plus PK Kerr, Iran’s nuclear program: Status, CRS Report for Congress, Congressional Research Service, 29 Iranian nuclear official calling it ‘very insulting and the IAEA. Following the talks, the IAEA provided December 2009, http://www.fas.org/sgp/crs/nuke/RL34544.pdf humiliating’. Iran with a draft deal that would see Iran ship the majority of its low-enriched uranium to Russia Department of Foreign Affairs and Trade, Australian autonomous sanctions: Iran, (n.d.), http://www.dfat.gov. The US and the EU-3 then made moves to have for further enrichment, with the fuel then being au/un/unsc_sanctions/iran_autonomous_sanctions.html the International Atomic Energy Agency (IAEA) refer returned to Iran for use in medical research and Iran to the United Nations Security Council (UNSC) cancer treatment. Iran proposed changes to the Explanatory Memorandum, Autonomous Sanctions Bill 2010, http://parlinfo.aph.gov.au/parlInfo/download/ for possible sanctions. draft agreement, which were rejected by the P5+1, legislation/ems/r4366_ems_22ae9018-5ad3-4c9d-bc9b-c9de4dc3e9fe/upload_pdf/343087.pdf;fileType=ap and the deal seemingly went nowhere. plication%2Fpdf

Page | 98 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Australia in the world Page | 99 on the UN Security Council on four occasions: With the return of Labor as a minority government Australia’s engagement with the United 1946–47, 1956–57, 1973–74, and 1985–86. it is likely that Australia’s UN Security Council bid will continue and diplomatic efforts will intensify Nations On 30 March 2008 Prime Minister Kevin Rudd leading up to 2012. As recommended by the Joint announced Australia’s candidacy to serve, for FADT Committee report in June 2001, Australia the fifth time, as one of ten non-permanent will most likely continue to support the reform Nina Markovic, Foreign Affairs, Defence and Security Section members on the fifteen-member UN Security of the UN Security Council, including additional Council in 2013–14. Australia’s competitors for the representation on a permanent basis for Africa and Overview Australia’s financial contributions to the UN two available seats in 2013–14 reserved for the Asia. If successful in its bid for the UN Security ‘Western European and Others Group’ to which Council seat, transparency would be enhanced by As a founding member of the United Nations (UN) In 2008–09, Australia contributed a total of $153.4 Australia belongs, are Finland and Luxembourg. the Government being as open as possible with system that was formally established on million to sixteen UN peacekeeping operations, Both are EU member states, each of which is the parliament about its priorities, decisions and 24 October 1945, Australia has been actively funding which is administered by the Department pursuing its own diplomatic quest for the role. In voting in the UN Security Council. involved in peacekeeping, disarmament, of Foreign Affairs and Trade. During the same September 2009, a poll conducted by the Lowy humanitarian and development assistance, period, the majority of Australian contributions to Institute for International Policy suggested that over Australia and UN human rights bodies administration, and other areas of the UN’s work international organisations supported the work two-thirds of surveyed Australians supported the for 65 years. Peacekeeping in particular has long of UN organs and agencies (over $89 million). Government’s bid. Australia is a party to the seven key UN enjoyed bipartisan political support, as exemplified Between 2007 and 2009, Australia was the human rights treaties. Australia complements by Australia’s strong support for ongoing thirteenth largest contributor to the regular UN In Labor’s pre-election foreign policy statement, this with engagement in regional forums and UN-mandated operations in Timor-Leste. budget. Advancing Australia’s Interests Internationally, bilateral dialogue with such countries as China the issue of Australia’s strong and reinvigorated and Vietnam. Australia’s activities towards The Australian Parliament has always taken a keen In the 2008–09 Federal Budget the Australian engagement with the UN was highlighted as strengthening the effectiveness of the UN interest in UN matters. Key activities include: Government announced an additional $200 million part of Labor’s three-pillar foreign policy vision. human rights regime (in particular the Human over four years in funding to the UN agencies Engagement with the UN is part of a broader Rights Council) is likely to intensify in the future, • parliamentary advisers attached to the working on the eight UN Millennium Development active involvement in multilateral forums. primarily through Australia’s engagement with the Australian permanent mission to the UN Goals (MDGs). As outlined in the 2008–09 budget Third Committee of the UN General Assembly, • creation of the Australian Parliamentary measures for AusAID, Australia’s funding for The Labor Government has so far allocated over and regional mechanisms. Non-government Association for UNICEF MDG-related activities is expected to significantly $11 million towards the bid (from a mixture of participation in UN human rights work (including by • Senate and Joint Foreign Affairs, Defence and increase closer to the year 2015—which is the existing and additional funding). This has resulted Australian civil society and private sector groups) is Trade (FADT) Committee inquiries target deadline year for achieving the MDGs. in more robust diplomatic engagement in Africa, likely to expand in the future. • Reports by the Parliamentary Joint Committee Although progress on several MDGs has been and dialogue with members of the Non-Aligned on Treaties, and slower in recent years (in light of the global financial Movement world-wide. It is expected that further Outlook • the United Nations Parliamentary Group crisis), Australia is likely to be active in generating funding for this initiative may be allocated to (established during the 42nd Parliament). further consensus to address the remaining gaps relevant government departments as the vote on Under the Gillard Labor Government, Australia is in the MDG progress, particularly in the South this matter in 2012 looms. likely to robustly engage with the UN, particularly The Rudd/Gillard Labor Government has placed Pacific. on issues that the Government perceives to be a renewed emphasis on Australia’s activism in The Opposition has expressed qualified support challenges to both global and Australia’s national multilateral institutions such as the UN. This is in Apart from the field of development assistance, for the UN system ‘where it is in Australia’s interests, such as climate change, food insecurity, line with Labor’s three-pillar foreign policy outlook, Australian contributions are likely to intensify national interest’. It has also criticised the Labor proliferation of weapons of mass destruction, and which places high importance on Australia’s in areas such as nuclear non-proliferation and Government’s funding allocations for the UN terrorism. Financial contributions to the work of multilateral engagements in the international arena disarmament, UN reform, and UN Security Security Council bid. The Coalition’s plan for real the UN agencies are likely to increase, in particular to complement the country’s bilateral relationships. Council-related work. action on Foreign Affairs (its pre-election foreign in support of overseas development assistance. The UN is regarded by the Government as the policy statement) portrayed this diplomatic initiative As in other policy areas, the challenge for the world’s pre-eminent conflict resolution body, as Australia’s UN Security Council bid as an extravagant affair and not in Australia’s current Government in increasing its engagement an essential forum for global cooperation, and as core foreign policy interests, which the Coalition with the UN is likely to be winning the support of the mechanism for responding to transnational The issue of Australia’s engagement with the UN believes lie predominantly in bilateral engagements parliament for its initiatives. A strategic, whole- challenges to human and international security— featured prominently in the 2010 pre-election with key partners, particularly those in the Asia- of-government approach to UN affairs could also notwithstanding its own institutional challenges. foreign policy statements of both the Government Pacific region and Indian Ocean Rim. include a dialogue with the non-government sector and the Opposition. In particular, Australia’s on key issues defining Australian engagement with candidacy for a two-year non-permanent UN the UN. Security Council seat emerged as an issue of contention between the two major parties leading up to the election. Australia has previously served

Page | 100 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Australia in the world Page | 101 sides demonstrating a degree of frustration at the Progress has been steady with a strong degree of Free Trade Agreement negotiations with North lack of progress. Negotiations are now in their fifth political support demonstrated by both sides. year. There remains a large number of difficult and Asia sensitive issues, with significant progress in the The KorAus FTA is likely to be the first North Asia short-term unlikely, unless the negotiations attract FTA under consideration by the new parliament. a greater degree of political interest in China. Both sides have clearly stated their desire for a Jeffrey Robertson, Foreign Affairs, Defence and Security Section rapid conclusion to negotiations. Australian and Japanese negotiators undertook Background • China—joint feasibility study undertaken in the 11th round of negotiations towards an FTA in In addition to the economic benefits, there are also March 2005 estimated that a comprehensive Canberra from 19–23 April 2010. Progress has a wide range of non-economic benefits that will Australia is currently in Free Trade Agreement (FTA) FTA could contribute A$24.4 billion over the remained steady since the commencement of accrue from a KorAus FTA. These include: negotiations with China, Japan and South Korea, period 2006–15. negotiations in April 2007. However, the current which in 2009 together accounted for 49 per cent • Japan—joint feasibility study published economic and political situation in Japan has • Head-turning effect—perhaps because of its of Australian merchandise exports and 33.3 per in December 2006, estimated that a reduced the willingness of its government to face complementary nature and overall success, the cent of Australia’s total trade. comprehensive FTA could, at the lower end of the increased opposition that would result from an Australia-Korea relationship has long suffered the range of Australia’s potential GDP gains, FTA with Australia. from a degree of complacency and disinterest Depending on progress, negotiations towards equate to A$39 billion in net present value on both sides. The media attention that could the Korea-Australia (KorAus) FTA are likely to be terms. FTA negotiations with Japan are particularly result from an FTA would potentially increase completed in time for an announcement in 2011, • South Korea—joint feasibility study published difficult due to the political influence of its rural public and ultimately political interest in the which has been designated as a bilateral Year of in April 2008, estimated that a comprehensive sector. Australia, in particular, is perceived relationship. Friendship, commemorating 50 years of diplomatic FTA could contribute up to US$22.7 billion in as a threat. While the Australian Government • Multilateral cooperation—Australia and ties between Australia and Korea. the period 2007–20. continues to emphasise the complementary Korea are widely considered to share a degree nature of Australia’s rural exports, there remains of interest as regional middle-powers. FTAs North Asia in the FTA debate However, in the context of FTAs with North Asia, a widespread perception that Australia presents provide for ongoing interaction through annual another factor is becoming increasingly relevant— an inherent risk to the rural sector’s viability. In reviews and consultation. This can increase Opinion has always been divided on the benefits competitive liberalisation. This occurs when a addition, the decision to address the whaling issue understanding and facilitate further cooperation of FTAs. Opponents contend that FTAs reduce country is forced to enter into an FTA in order to at the International Court of Justice has attracted on wider multilateral issues, such as multilateral participant interest in multilateral liberalisation, avoid competitive disadvantage due to a trade criticism from key coastal rural districts. trade liberalisation, regional financial reduce efficiency through trade diversion, rival’s market access obtained through another cooperation and economic regionalism. endanger cultural diversity and primarily serve non- FTA. A political boost to FTA negotiations with Japan economic interests. Supporters contend that FTAs may come from the meeting between the Competitive liberalisation also plays a role in prepare participants for multilateral liberalisation, Australian beef in the South Korean market is Japanese Prime Minister and the Australian Prime achieving Australia’s aims. The implementation create trade through ‘head-turning’ effects and a good example. Australia currently holds a Minister at the November 2010 APEC Leaders’ of an FTA with Korea could provide an impetus benefit consumers through increased competition. historically high 58 per cent of the Korean beef Summit in Yokohama. for Australia’s negotiations with China and Japan. import market, after consumer fears regarding Similarly, an FTA with Australia would aid Korea by Recent studies highlighting the disparity between Bovine Spongiform Encephalopathy (BSE, or Australian and South Korean negotiators placing further pressure on US lawmakers to pass the estimated benefit to economic well-being ‘mad cow disease’) in US beef led to a substantial undertook the fifth round of negotiations towards the KORUS FTA, which is currently stalled in the set out in government feasibility studies, and the decline in US imports. In June 2007, Korea and an FTA in Canberra from 25–28 May 2010. US Congress. actual results, has buttressed opposition to FTAs. the United States signed an FTA (KORUS FTA). Supporters contend that these studies are based When (and if) implemented, Korean tariffs on beef on models, which cannot be expected to account imports will decline from the current 40 per cent for external changes (such as the global financial to zero in 15 equal annual reductions. Accordingly, Library publications and key documents crisis) and that without an FTA, bilateral trade may Australia needs to obtain an FTA which provides Department of Foreign Affairs and Trade, Composition of Trade Australia 2009, Commonwealth of Australia, be affected even further. an equivalent degree of market access in order to Canberra, May 2010. avoid competitive disadvantage. Joint feasibility studies commissioned or M Priestley, Australia’s Free Trade Agreements, Background Note, 2008–09, Parliamentary Library, Canberra, undertaken by the Department of Foreign Affairs Current status of negotiations 2008, http://www.aph.gov.au/Library/pubs/BN/2008-09/AustFreeTradeAgreements.htm and Trade (DFAT) estimate that the achievement of comprehensive FTAs in North Asia could Australian and Chinese negotiators undertook J Robertson, Time for an Australia-South Korea FTA?, Research Note, no. 31, 2005–06, Parliamentary Library, substantially add to Australia’s economic well- the 15th round of negotiations towards an FTA in Canberra, 2006, http://www.aph.gov.au/library/pubs/rn/2005-06/06rn31.pdf being: Beijing from 28–30 June 2010. FTA negotiations with China have been particularly slow, with both

Page | 102 Parliamentary Library Briefing Book: Key Issues for the 43rd Parliament Australia in the world Page | 103 Secretary General Ban Ki-moon has expressed reduction in greenhouse gas emissions by Copenhagen: a stepping stone doubt that a treaty can be finalised at COP16 (to 2020 (on 1990 levels) and is currently seeking be held in Cancùn, Mexico). This view is shared to increase this to 30 per cent. To achieve this Anita Talberg, Science, Technology, Environment and Resources Section by many countries, which are now focussing more target, the EU has had a functioning emissions on COP17 in 2011 in South Africa. It is hoped that trading scheme (ETS) since 2005. The EU bloc of the Cancùn meeting will discuss the core issues 27 countries is anxious that a new international of climate change adaptation, capacity building, agreement be reached before the end of the Kyoto finance, REDD-plus, and technology transfer, and Protocol’s first commitment period in 2013, as the There were high expectations for the climate registered with the UNFCCC (see table) that it will also pave the way for an international success of its own ETS depends on it. change conference in Copenhagen in December • promotion of REDD and the enhancement treaty at COP17. 2009 (15th Conference of the Parties—COP15). of existing forests (collectively known as On the other side of the spectrum, the United However, the participating countries of the United REDD-plus), and Who is at the negotiating table? States (US) has always been, and remains, Nations Framework Convention on Climate • fast-start mitigation and adaptation finance a major obstacle to a new treaty under the Change (UNFCCC) were not able to reach a of US$30 billion for 2010–12 and longer- There are currently 194 Parties to the UNFCCC. UNFCCC. The US has been unable to pass climate legally-binding agreement. term mitigation funding of US$100 billion by Each Party has an equal voice, but negotiations legislation through its Congress. This has spurred 2020, some of this via a newly-established tend to take place between Party groupings, or the individual American states to take on the What Australia brought to the COP15 Copenhagen Green Climate Fund. blocs. These are usually regional but can also be responsibility, with many cooperating in a regional based on common positions. The major blocs are: ETS. The US Environment Protection Agency is table Some Copenhagen Accord country commitments also investigating ways to reduce greenhouse Coming into those negotiations, Australia was Emissions reduction in • G77 and China: a diverse group of more than gas emissions through regulation. However, until Party Base year advocating a global legally-binding agreement 2020 (a) 130 developing countries there is support from Congress, the US cannot that targeted an atmospheric stabilisation level of Australia -5% up to -15% or -25% 2000 • Africa Group agree to international demands. With the likelihood 450 parts per million of carbon dioxide. Australia • Association of Small Island States: 43 countries of a Republican majority after the upcoming Canada -17% 2005 sought commitments of comparable effort from almost all included within the G77 Congressional election, the chance of such all countries and presented its own version of EU -20% or -30% 1990 • Least Developed Countries: about 50 nations support is slim. a framework to succeed the Kyoto Protocol, Japan -25% 1990 • European Union (EU) known as the National Schedules proposal. This • Umbrella Group: Australia, New Zealand, Finally, the BASIC group of high-emitting New Zealand -10% to -20% 1990 proposal required all nations to record their own Iceland, Russian Federation, Japan, Norway, emerging economies, which only started to commitments, whether they be emission reduction Russian Federation -15% to -25% 1990 Ukraine, Canada and the US form shortly before COP16, have become one targets or specific mitigation actions, in a central US -17% 2005 • Environmental Integrity Group: Mexico, of the strongest negotiating blocs. The BASIC registry. Countries would then be accountable to Republic of Korea and Switzerland countries are lobbying hard for a legally-binding (a) Almost all commitments are contingent on the criteria of that registry. As well as the National Schedules, • Central Asia, Caucasus and Moldova (CACAM) follow-up agreement to the Kyoto Protocol by any global agreement Australia went to COP15 hoping for agreement on Source: http://unfccc.int/home/5264.php • Organisation of the Petroleum Exporting the end of 2011. They want deep emission a market mechanism to reduce emissions from Countries (OPEC) reduction commitments, transparent actions, and deforestation and forest degradation (REDD), • Bolivarian Alliance for the Peoples of Our fulfilment of finance promises from developed especially in countries like Indonesia, where What has happened since COP15 America (ALBA) countries before obligations should be imposed on Australia already has bilateral programs on this. • BASIC: Brazil, South Africa, India and China, developing countries. A new Executive Secretary of the UNFCCC, The outcome of COP15 was the Copenhagen and Christiana Figueres, has been appointed and Accord; it fell short of many of the Australian • Cartagena Group/Dialogue for Progressive she continues to direct efforts towards reaching Conclusions Government’s expectations. Action: a diverse group of 27 countries a legally binding treaty. Two more meetings have including Australia. The first commitment period of the Kyoto Protocol taken place since COP15, with a final one planned will end in December 2012. If a new agreement is Copenhagen Accord in October 2010 before the next high-level meeting not reached soon, there will be a break between in December 2010—COP16. These meetings have The major players The Copenhagen Accord was a decision that the first and the next international framework. seen little progress on the successor to the Kyoto the Conference ‘took note of’, without formally Of the developed countries under the UNFCCC, There may be legal implications associated with Protocol, and that of a broader agreement on accepting. As such it has no legal implications. The the EU has always been the strongest campaigner this break, and a danger that significant funds and climate change. key elements of the Accord are: for climate change action. Within its own momentum will be lost. jurisdiction, the EU has mandated a 20 per cent • a temperature increase ceiling of two degrees What to expect from COP16 and COP17 • emissions reduction targets by developed In contrast to those of COP15, expectations for Library publications and key documents countries and ‘Nationally Appropriate Mitigation COP16 in December are modest. United Nations Actions’ from developing countries, all to be United Nations Framework Convention on Climate Change (UNFCCC) website, http://unfccc.int/2860.php and International Institute for Sustainable Development (IISD) Reporting Services website, http://www.iisd.ca/

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