Full Day Hansard Transcript (Legislative Council, 15 November 2000, Corrected Copy)

LEGISLATIVE COUNCIL

Wednesday 15 November 2000
______

The President (The Hon. Dr Meredith Burgmann) took the chair at 11.00 a.m.

The President offered the Prayers.

CRIMES AT SEA AMENDMENT BILL

GENERAL GOVERNMENT DEBT ELIMINATION AMENDMENT BILL

Bills received.

Leave granted for procedural matters to be dealt with on one motion without formality.

Motion by the Hon. J. J. Della Bosca agreed to:

Bills read a first time.

THE HONOURABLE Dr BRIAN PATRICK VICTOR PEZZUTTI
AUSTRALIAN DEFENCE FORCES APPOINTMENT

Motion by the Hon. M. R. Egan agreed to:

TABLING OF PAPERS

The Hon. E. M. Obeid tabled the following annual reports:

Ordered to be printed.

PETITION

Windsor Women's Prison

Petition praying that construction of a women's prison at Windsor be abandoned, that the funds be channelled into research to assist girls and adolescent and adult women at risk of offending, and that social programs on crime prevention be introduced, received from the Hon. R. S. L. Jones.

GENERAL PURPOSE STANDING COMMITTEE No. 3

Membership

The PRESIDENT: I inform the House that on 14 November the Leader of the Government nominated the Hon. I. W. West as a member of General Purpose Standing Committee No. 3 in place of the Hon. A. B. Manson, resigned. I further inform the House that on 14 November the Leader of the Opposition nominated the Hon. G. S. Pearce as a member General Purpose Standing Committee No. 3 in place of the Hon. D. T. Harwin.

SYDNEY 2000 GAMES ADMINISTRATION BILL

Second Reading

The Hon. M. R. EGAN (Treasurer, Minister for State Development, and Vice-President of the Executive Council) [11.11 a.m.]: I move:

That this bill be now read a second time.

I seek to leave to have the second reading speech incorporated in Hansard.

Leave granted.

The Hon. M. J. GALLACHER (Leader of the Opposition) [11.12 a.m.]: I want to place on record at the outset that the New South Wales Coalition is opposed to the passage of the bill through this Chamber. Today marks the two-month anniversary of the commencement of the Olympic Games. I believe I am correct in saying that many in the community are still basking in the afterglow of the Olympic Games given all of the positive aspects that played a very important part in our lives during that two-week period and in the period following on from the Olympic Games and the Paralympic Games.

Be that as it may, there is no doubt in the minds of members of the Opposition that in light of the $2.5 billion expenditure on the Games, there will be most certainly some significant need for public scrutiny. The existing Act incorporates a sunset clause that comes into effect on 31 March 2002. By introducing this bill, the Government has signalled its intention to wind-up the SOCOG board and the Olympic Roads and Transport Authority [ORTA], and transfer their functions to the Olympic Co-ordination Authority [OCA].

The Coalition believes it is appropriate and in the best interests of the people of New South Wales that this legislation does not pass this House at this stage. In the Coalition's view, it is a question of accountability and public responsibility. The existing Olympic structure is the most appropriate for the Government's dissolution of the Games; it will ensure public confidence in the process of dissolution and an appropriate level of public accountability.

Whilst the majority of the day-to-day functions of the Games organisations will be concluded at the end of the year and the staff will be departing for other positions in the public or private sector, accountability to the taxpayers of New South Wales did not end with the closing ceremony of the Paralympic Games. By introducing this bill the Government has signalled its intention to wipe the slate clean. It is for that reason that, although the Coalition has always adopted the bipartisan approach of supporting the Games, we are not prepared to support or endorse this legislation at this time.

When the original Sydney Organising Committee for the Olympic Games Act was passed by this Chamber shortly after the Coalition won the bid to stage the 2000 Olympics in 1993, a determination was made to maintain the existing structure of SOCOG until after the Olympics, with a sunset clause coming into effect on 31 March 2002. That date was determined to allow for the orderly and timely conclusion of all the activities associated with Olympic and Paralympic Games. It is extremely important that honourable members really focus on what was put down as the parameters in so far as the sunset clause is concerned, and the raison d'�tre for SOCOG and ORTA's formalisation by this Parliament some years ago, to ensure there is consistency with regard to the winding-up progress. Although the Olympic Games and the Paralympic Games are now over, there are a number of ongoing activities to be completed.

[Interruption]

The games that members opposite are talking about are the back-room games that we see more and more of. The people of New South Wales are starting to recognise those traits in the Australian Labor Party. The debate today is not about the games that the Labor Party is used to playing; we are in fact talking about the Olympic and Paralympic Games.

The ongoing activities include: payment of Olympic financial claims or accounts and finalisation of more than 4,500 contracts for the key Olympic agencies; dealing with any litigation that may arise; providing information for a final report by the Auditor-General on the costs of the Games, and reporting to the IOC on the staging of the Games; disposal of the media village; restoring Olympic venues to post-Games configurations; establishing the Sydney 2000 Games archives; and transferring Olympic facilities to the relevant bodies. A considerable amount of work is still to be done.

One needs only to consider what would happen in the private sector if a major organisation decided to wind-up immediately. There would be a hue and cry with regard to that process. It is common practice that the winding-down of any significant project should be a gradual process. As each layer is stripped away there must be a degree of public scrutiny to ensure that the process had integrity from the outset. The Opposition is committed to providing that public scrutiny for the people of New South Wales.

The Opposition has not embarked on a fishing expedition with regard to the Olympic Games. We did not, immediately after the Games, call for this or that inquiry. It is the Opposition's view that the Olympic Games, to this point, were a success and should be so regarded. However, as time goes by, as each layer of the Games is slowly stripped away and public scrutiny is in place, we will be able to follow through the decisions that this Government and indeed SOCOG and ORTA made, to ensure that they can stand the test once the light is applied to them.

The Opposition does not believe an investigation is warranted at this stage and no evidence to the contrary has been provided to it. The approach of the Coalition in regard to this legislation is consistent with its desire to ensure a level of public accountability and scrutiny of the Games in the post-Games period. The taxpayers of New South Wales have contributed billions of dollars to stage the Olympic and Paralympic Games and deserve to be treated with respect and to know where their money went. As the State Government is the underwriter of SOCOG, any debts will be the responsibility of the people of New South Wales—the responsibility not only of the Minister or of the Government, but of every one of us.

This Government is not concerned about accountability, because it avoids accountability at all costs. When the time comes for analysis and hard questions the Government's response will be, "Sorry, the Minister responsible for the Games has retired. Sorry, that organisation no longer exists. Sorry, the staff employed during the Games are no longer working for us. Sorry, any information or reports we had are now in storage, or hit the shredder, or are simply lost." The Opposition maintains its position of ensuring that there is a structure in place and ensuring that as time goes by and the winding-up process is completed it is open to public accountability and scrutiny by the Parliament. With those comments I again ensure that the Minister is aware of our opposition to this legislation.

The Hon. D. J. GAY (Deputy Leader of the Opposition) [11.20 a.m.]: I also oppose the bill. This bill is the Michael Knight concrete bill, with which the Government will concrete over any evidence that may or may not be left behind when Michael Knight jumps out into the private sector.

The Hon. R. S. L. Jones: That is a conspiracy theory.

The Hon. D. J. GAY: I am not into conspiracy theories easily, but Michael Knight engenders thoughts of conspiracy. I find it appalling that Michael Knight, having announced that he will resign from Parliament at the end of the year, continues as a Minister in the Government despite the fact that he has hawked his curriculum vitae around to every private enterprise group in town.

The Hon. R. S. L. Jones: How do you know that?

The Hon. D. J. GAY: He advertised that when he resigned. He said, in effect, "Here I am. Would you take me? Do you want me?" That was his statement on announcing his resignation.

The Hon. R. S. L. Jones: Would you do the same thing?

The Hon. D. J. GAY: That is a valid point. No, I would not do the same thing. If I were going to resign from the position held by Michael Knight, I would resign from the ministry at the same time. It is just appalling that he has continued in a ministry that controls millions of dollars of State money. He is hawking himself and his CV around town. If the Premier of this State had any nous, he would demand that Michael Knight resign. The Premier was down a mine on the day he heard about Michael Knight's intention to resign from Parliament. He should have said, "Yes, thank you, we would love you to go, but we want your resignation from Cabinet immediately." That is what a proper Premier would have done to remove any potential conflict of interest, because this fellow is out there looking for a job. They are not my words, but his words. He is susceptible whilst he continues as a Minister.

The Hon. J. R. Johnson: Oh, Duncan!

The Hon. D. J. GAY: Don't "Oh, Duncan!" me, Johnno. You always say that when you know we have caught your people doing the wrong thing, something you would not do.

The Hon. I. M. Macdonald: That is absolutely outrageous.

The Hon. D. J. GAY: It is not outrageous. It is absolutely appalling that this bloke continues as a Minister despite the fact that he is hawking himself around town for a job. It is just disgraceful. I know that there are quiet and decent members of the Labor Party who equally find this to be appalling.

The Hon. I. M. Macdonald: We all supported Richard Bull.

The Hon. D. J. GAY: Richard Bull was not a Minister.

The Hon. I. M. Macdonald: He was the leader of a party.

The Hon. D. J. GAY: It was a very different situation with John Hannaford and Richard Bull. They were not Ministers of the Crown and were not in charge of a multimillion-dollar portfolio that affects a lot of money and enterprise in this State. The fact that Michael Knight continues in the position leaves the Government susceptible.

The Hon. J. R. Johnson: Duncan, I expected better of you.

The Hon. D. J. GAY: The Hon. J. R. Johnson said that he expects better of me. I would expect no less than that I make a statement along these lines. It is appalling that his Premier and his party have allowed this bloke to stay on as a Minister despite the fact that he said that he is going. First, he should have been out of the ministry because he said he was going; second, he is looking for a job in private enterprise; and, third, he is continuing to control SOCOG. That should not be allowed to happen. The Hon. J. R. Johnson would not be surprised to know, I suspect, that the former State Auditor-General has the same concerns. If the Hon. J. R. Johnson wants to disagree with the Auditor-General, whom his party appointed, that is up to him.

The Opposition opposes this bill because it will concrete over the car park to cover up where Michael Knight has been. As soon as the bill is passed there will be a power surge in certain areas and the shredders will be put to work. As the Leader of the Opposition said, we do not know whether anything wrong happened in the conduct of the Games. But the documents and whatever happened need to be investigated. I need go no further than the second paragraph of Michael Knight's speech to the Parliament on this matter. In the other place he said:

They are not my words, not something I am making up, but the words of the Minister. He continued:

That is an important point and should not be underplayed. He continued:

Reebok is not a small fly-by-night company. That is a major matter. According to the Minister's words, that appears to be not the only major matter, because he said "for example". It is my understanding that other major multinationals, including caterers and food and drink companies, are also in litigation with SOCOG. The Minister continued:

We have to guarantee that that information is intact and in place, and that the Auditor-General can contact people about the cost of the Games. The Minister continued:

That is not a minor matter. The Government has not made a final decision on the handing over of the facilities, but it seems that there is indecent haste to wind up SOCOG. Yet in other legislative areas when the Government has moved bills through this House we have agreed to extensions of time. The Opposition understands the contradiction. If one wanted another reason for the Opposition to oppose the bill it would be contained in the dissenting report by members of a committee of this House that inquired into Olympic budgeting. That dissenting report, by the Hon. Patricia Forsythe, the Hon. Dr P. Wong and me, is relevant to this bill. The report stated:

^rd

I quote from Michael the magnificent:

However, less than a month after the Treasurer made that statement in this House a bill was presented to Parliament seeking the release of an extra $140 million for the Olympic budget. One day the Treasurer says that the Olympics are paid for, every last cent—and we should, of course, believe the Treasurer of this State—yet less than a month later there is a request for another $140 million. There is one situation on 23 May and another a month later. If we pass a similar bill in good faith, how do we know that we will not find out in less than a month that the bill was used as a cover-up? Frankly, I believe it is much too big a risk.

The dissenting report stated that the inquiry represented probably the last chance for Parliament to exercise scrutiny over the budget prior to the Olympic Games. Whilst the Opposition endorsed the conclusions in the main body of the report, we believed that the committee had missed the opportunity to comment on key aspects. These highlights of the dissenting report from the committee are an indication once again that we should proceed with caution when considering anything that this Government does with bills relating to either funding or the machinations of the Sydney Organising Committee for the Olympic Games [SOCOG].

The Games were a huge success—due in no small part to the Minister for the Olympics, the staff and volunteers and, particularly, Sandy Hollway, whom for some unknown reason the Minister wishes to sideline. Our opposition to this bill does not demean that success, which the Government rightly deserved. We want to find out whether there are problems and, if so, where they are and what caused them, and fix them up. The Opposition will oppose the bill because we do not want matters to be swept under the carpet; we want complete transparency.

The Hon. PATRICIA FORSYTHE [11.32 a.m.]: Without any doubt, the Sydney Olympics and the Sydney Paralympics were, as has so often been said in this place, the best Games ever. Motions in both this House and in the other place have rightly acknowledged the success of the Games and the contribution of the many people who were involved—such as the board and staff of the Sydney Organising Committee for the Olympic Games [SOCOG], staff of the Olympic Co-ordination Authority [OCA] and the Olympic Roads and Transport Authority [ORTA], the Government, the people of Sydney and the volunteers. Many organisations and many people played a role in that success. We have rightly acknowledged that in a bipartisan way.

In no sense does our acknowledgment of the success of the Games take away from our responsibility as a Parliament and as an Opposition to ensure that in terms of accountability we have absolute confidence that we are acting in the best interests of the taxpayers of New South Wales. The Opposition is not convinced that this legislative framework is in the best interests of the taxpayers of New South Wales. The Games were the best ever. They were collectively a fabulous party. As with any party that one has at home, afterwards there is the cleaning up and the paying of bills. Sometimes things go wrong, even with the best parties, and there is a potential for legal challenge.

The point I make is that just because the party ended, associated matters may not have ended. We know for a fact that is the situation in relation to the Games. We need look no further than the Minister's second reading speech, in which he acknowledged ongoing activities. I will quote the first three activities he referred to. First, the Minister referred to "the payment of Olympic financial claims or accounts and contract finalisation for the key Olympic agencies—in all, more than 4,500 contracts require finalisation". That is a key point. The Minister's second point was "managing any post-Games litigation that may arise—for example, Reebok is suing SOCOG and SOCOG is countersuing Reebok".

Members of General Purpose Standing Committee No. 1 in its inquiries into the Olympic Games are well aware, from the evidence of the Minister and many other senior officials, that they anticipated numerous legal challenges. The Minister's own words are very telling: "any post-Games litigation that may arise". SOCOG is being sued. The Minister makes the point that there may be more litigation as various suppliers look at their contracts and the outcomes. It has been suggested to me—and it has been floated around in this place in the past couple of days—that potentially one of the key suppliers, such as the soft drink supplier, may be considering litigation.

The third issue raised by the Minister was "providing information for a final report by the Auditor-General on the cost of the Games and providing a formal report to the international Olympic Committee [IOC] on the staging of the Games". The final report to the IOC is less relevant to the taxpayers of New South Wales than a final report by the Auditor-General. That report is of great relevance, perhaps more than anything else. The provision of information for a final report has not yet occurred. The accounts have not been finalised, and the books have not been closed and passed over to the Auditor-General. The Games may have finished but the work of SOCOG and the other agencies is far from over. No-one would imagine anything other than that. That is why, when the original Olympics legislation was passed by this Parliament, the key date for the existence of the entities was March 2002.

Why do we smell a rat with this legislation? Because since the original legislation establishing SOCOG came into existence this Government on more than one occasion in this place has introduced legislation dealing with the Olympics. If the Government found something wrong in the notion of the entities remaining as legal entities until 2002, it could have sought to amend the legislation at any point. It did not. The Government waited until the Olympics were over and then sought to introduce this legislation. I question the timing.

If the Government had always known that there would not be a role for SOCOG, ORTA or the Sydney Paralympic Organising Committee [SPOC] as entities, it had ample opportunity to amend the legislation well in advance of the Olympics. The reality is that the Government knew that they would have a role, and the Minister has clearly defined what that role would be: the finalisation of accounts and contracts. As we all know, some people are slow at billing. There is no guarantee that every single organisation that has a claim to submit to SOCOG or SPOC will have provided its accounts before the end of this year.

The Minister says, "Not a worry. We will just hand it all over to OCA, which will be able to deal with it." The Government says, "Trust us; there will not be a problem." But we do not trust the Government on this one. During the two inquiries in which I was involved, those related to ticketing and the $140 million contingency, I received numerous phone calls, anonymous letters and scraps of information from people inside SOGOC who believed that we should be aware of certain information. The group that has probably received the least credit is the staff of SOCOG, which has done an enormous amount of work and achieved wonders. But that has been done at some cost to the morale of the group.

Of great concern has been the way in which SOCOG staff have sometimes had to carry the can in relation to controversy. The way in which Sandy Hollway was dealt with by the Minister—and I see that the bovver boy is in the President's Gallery as I speak—made them exceptionally angry that they were not being given credit for the work they had done. They expressed great concern about the legislation. I made notes at the time of the inquiries, and I want to quote some of the concerns that were put to me by anonymous staff members—staff members who consistently gave me sufficient snippets of information to suggest that they knew what they were talking about. Those people were very much on the inside, people who had an ear to the ground about what was going on inside the organisation. Their morale has suffered because of the way in which the Carr Government has treated them.

I made a couple of notes this morning from the various calls and letters I have received. For example, it was suggested to me that SOCOG planning and budgeting was disastrous, that its managers drew up wish lists which then became plans. Even when costs had to be cut, staff members were not given budgets within which to operate, and savings were made in areas where the cost would be transferred to the Government. I am not one to single out bureaucrats, people who work in such organisations, but the name of one manager kept coming up, particularly in the ticketing inquiry and after I had seen the witness. That manager was Paul Reading, a person who was described as being so arrogant in his belief that they could do whatever they wanted that he lost reason in dealing with many of the matters that had to be dealt with in an appropriate way.

Some fairly damning comments were made about the Minister in his then role as President of SOCOG. Honourable members will remember that it was the Opposition that expressed initial concern at the appointment of the Minister as the President of SOCOG because of possible conflicts. Nothing that happened in the years following the legislation caused us to change our view that it was inappropriate that he would sit both as Minister and President of SOCOG. One of the snippets of information passed on to me merely reinforced those concerns. I was informed that the Minister for the Olympics had been briefed on finance issues, but he did not pass on material to the Government in an appropriate oversight role.

When we were talking about the $140 million contingency, one of the allegations that was made to me by staff was that the only person in the Government who was initially prepared to stand up on this matter was the Treasurer. One little note that was passed to me stated that the Treasurer knew about it but he had no support. There has been an attempt to bury the $140 million contingency, but at the end of the day it was the Treasurer who forced the separate legislation. Can we be confident that all is out in the open and that the legislation is simply a winding-up of a few entities so that OCA can deal with it neatly in one parcel? No, we cannot. It was also suggested to me that the board was not informed of vital information and that the Minister—the President—saw the process as a political rather than a business process.

I was also told that the real cost overruns would not be known for approximately 12 months. If a person on the inside believes that we will not know the real cost overruns for up to 12 months, we cannot afford to take a chance with the legislation. There is a need to maintain the SOCOG board and the SPOC board and to leave order in place. We cannot take the risk that in the folding up of those organisations and the passing over of responsibility to OCA the paper shredders will be working overtime, key pieces of information will be lost, and accountability will be lost. I knew about the legislation at the time of the inquiry because one of the people who sent me information suggested that the Premier was preparing to act to delete all the Olympic organisations and get rid of the Minister for the Olympics: "The goal is to get rid of any targets. No more of the O word, and when all the O organisations are gone the Government will have control of everything."

I was told, "This needs scrutiny. They will have plenty of opportunity to bury the dead." Faced with that sort of information from inside SOCOG how can I do other than urge members of the crossbench and the Government to think again about the legislation. If the aim of the legislation is to bury the dead and shift control to the Government so that accountability by the organisations that signed the contracts involved in all the key business decisions are not folded up and hidden inside the Government, I presume the Government will say, "Don't worry. We've got the Auditor-General; the Auditor-General will have the appropriate oversight role." If only that could be forever thus. I remind the House of some evidence that the Auditor-General provided to the general purpose standing committee inquiry into Olympic budgeting. In his opening statement he said:

The concern of the Auditor-General was that we may have acted in haste because we had not been given sufficient opportunity and we had not been given sufficient information. If we go ahead and pass the legislation we must be mindful of the concerns of the Auditor-General in relation to the $140 million contingency legislation and mindful that he said later that he was concerned that we had not been given enough information. The Government has not supplied us with sufficient reason to confidently support the bill; we have not been given sufficient information. In passing up an opportunity for ongoing scrutiny we would be giving away our rights of protection in the interests of the taxpayers of New South Wales. That is why the Opposition has taken such a strong position on the legislation.

We knew in 1993 that when the Olympics were over it would not mean the end of our obligation to New South Wales taxpayers. That is why the original legislation took the role of SOCOG and SPOC much further than the end of the Games. I was fascinated by the Minister's response last night to the Opposition's position. He feigned concern and some measure of shock and horror that we would take this position. He should have known that arising out of our concerns from the earlier inquiries we would scrutinise this bill. I found his reference to the role of SPOC particularly interesting. After giving various reasons why he thought we were being silly he said:

He does not say the same about the role of SOCOG. He does not refer to the fact that it would meet long after the accounts have been effectively balanced and long after there is anything left to do. In other words, I believe he singled out SPOC because it was always the least controversial; it always worked within a defined budget and was not able to simply write cheques to achieve what it wanted to. It knew it had to work within a limited budget, and it had a different level of support from government.

But it is interesting that the Minister acknowledged that SPOC continued long after accounts had been effectively balanced. I wonder how long the Minister imagines it will take before SOCOG is able to say that its accounts have been effectively balanced, which will be long after it has anything to do. I am not aware of any litigation in relation to SPOC, but I am certainly aware of litigation involving SOCOG. I do not believe it is fair to say that simply winding up the organisations and handing them over to OCA will make it all right. At the very least, as a Parliament we have an obligation to ensure that until the Auditor-General has signed off on and is satisfied with the accounts and the processes of SOCOG, ORTA and SPOC we will not pass this legislation.

The accounts have not been finalised, and they certainly have not been sent to the Auditor-General. At this stage there has been no scrutiny. Scrutiny is vital if we as a Parliament, acting in the interest of the taxpayers, are to act responsibly. Nothing in the Minister's second reading speech or in his summary gives me any confidence that this is not all a trick on the part of the Government, that these are not all words about a cover-up. That is the view of staff inside SOCOG; that is the view of the people who should have been given credit for what they did but who were so successfully bypassed by the Minister. They are so angry that I suspect that as the dust settles and they have the opportunity to put the position in order the Opposition will hear much more from the SOCOG staff who feel miffed.

The staff of SOCOG held a party recently to congratulate each other. They did not invite the President of SOCOG. That is a fair indication of how they feel towards the Minister and the way he has treated them. I do not believe this legislation should be passed when so many issues relating to litigation and accounts are up in the air. We need to keep the bodies that must be accountable. In view of what the Auditor-General said about the Parliament not having sufficient information and opportunity to make an informed decision about the $140 million contingency, we cannot give the Government the opportunity to quickly wind up those Olympics organisations and get rid of the O word, as one of the staff members said to me.

We owe it to the taxpayers of New South Wales to ensure that every opportunity for accountability is maintained. We cannot afford to pass this legislation today. It is logical to assume that an inquiry will be conducted arising out of whatever information is received from the Auditor-General. I suspect that the Auditor-General has ongoing concerns in relation to this matter. I urge crossbench members in particular to act cautiously and support the Opposition on this legislation.

The Hon. Dr A. CHESTERFIELD-EVANS [11.56 a.m.]: This bill presents the classic dilemma: one does not trust the Government with its bovver boy tactics and lack of acceptance of the principle of scrutiny, yet the Opposition does not really have an alternative. I suppose crossbench members are frequently in this position. The Government claims that it is going to stop waste. It claims that if these boards remain they will generate costs without having a great deal to do. It would seem plausible that this organisation, which was large enough to organise the Olympic Games, is simply waiting for some bills to come in or for an inquiry into the cost benefits of the Games. That has been advocated by the Greens and to some extent is dealt with by the amendments of my colleague the Hon. R. S. L. Jones.

I understand that SOCOG is approximately $140 million in the red. That amount will have to be picked up by the Government, although there was a promise that there would not be any budget overruns as a percentage of the total. I am not sure whether that is good or bad; I suppose it depends on how one looks at it. The Government's position is that as a number of boards are redundant in size they should be rolled into a single entity and the documentation preserved and audited; that there will be a paper trail; and that this is not a cover-up. I would love to think that is true. I do not have sufficient details to comment seriously in an analytical way.

There were some mistakes in the organisation of the Games. Marching bands, which would have come from around the world, were abandoned because it seemed that we did not want too many foreigners. I believe that the marketing decisions in regard to ticket prices for elite groups were shown to have two flaws. First, the elitism inherent in selling expensive tickets to the elite was offensive to the Australian sensibility, particularly when many Australians could not get tickets. Of course, the public never got a go at purchasing those tickets. Second, it seemed that the number of overseas visitors was overestimated, but that fact could not be hidden because Australian ticket allocations had proceeded.

It was resolved by the good old Aussie battlers, who said, "Beauty, there are some tickets," and shelled out their money to buy them. In a sense, the stuff-ups of the elite were covered up by the basic decency of the Australian people and their enthusiasm for the Games. In a sense, it was very much the people's Games and a high percentage of tickets were sold. I am not in a position to know whether that percentage overcame the prices that the marketing experts had hoped to get but did not, but presumably those facts and figures would be available to the Auditor-General if the ticketing philosophy were clearly defined.

As my colleague the Hon. Patricia Forsythe has said, there was a lack of documentation of the ticketing philosophies and prices. That had a somewhat unsavoury smell about it. The Opposition has managed to throw some doubt on the situation but has not really made its case that the bill has to be opposed. It is all very well to have all these boards looking after documents and not shredding them in the interests of open government, but even under the Opposition's proposals one could not guarantee that they would not be shredding them anyway. Are we simply using a sledgehammer to crack an egg? The Opposition does not have any plan as to how any sort of audit or more broad inquiry should go ahead. It has said that it is not time yet; it will be time later.

It would seem to me that the Australian people would be interested in a financial result. I do not think it is anti-Olympics or disturbing our post-Olympic glow or the new wave of nationalism and pride surging up in us all if someone asks that a business come up with its costs and an honest look at its failures and successes following an event, or even a time period. Each company, at the end of the financial year, comes up with a financial report. Obviously, it has ongoing liabilities and debts—it may have ongoing litigation—but it still states what it did in that year, its successes and failures. Supposedly, it gives this out honestly to the shareholders and puts information in the annual report. Obviously, some things are glossed over in the interests of management. No-one would pretend otherwise. But the principle that an attempt should be made for an honest evaluation should be supported. I wonder why the Opposition, in opposing the bill, has not come up with something a bit more substantial in terms of some sort of procedure, timeframe or something else.

The Hon. Patricia Forsythe: It is in the original Act.

The Hon. Dr A. CHESTERFIELD-EVANS: It is all very well to simply complain but the Opposition has not foreshadowed any amendments which would fix the problem. If the Opposition believes it was stated in the original Act, why does it not come up with a plan and put it in the bill? On balance, the Government has accepted the amendment foreshadowed by the Hon. R. S. L. Jones, which will attempt to keep the documentation for an analysis when one is done. We hope the Auditor-General will be able to work within this framework and that there will be sufficient information available to assess the economic effects on the economy as a whole. With these considerable reservations, which arise because of the Government's lack of respect for open process and transparency, I support the bill.

The Hon. R. S. L. JONES [12.04 p.m.]: I support the Sydney 2000 Games Administration Bill. I wonder what the Opposition is going on about in opposing the bill. I have just this moment spoken with Nick Greiner on the telephone. I would have thought that his opinion would be respected by Opposition members. He said that he was happy for the wind-up to take place on 31 December. He said that it was a sensible date to wind up, with the proviso that the final accounts can be signed off by the board before that date. The accounts will not be final because there are one or two court cases taking place, which may take up to five years, but the accounts will be all but final. So if the members of the board are happy for it all to be wound up by 1 January—I understand that Chris Hartcher, being a member of the board, would be aware of the situation and be supportive of the wind up as well—it would seem that a very strange situation is occurring: the more sensible members of the Opposition support the wind-up and for some reason some other members have decided to oppose the wind up.

It does not make too much sense to me. I believe it is time to wind up, providing the final accounts are ready. I cannot possibly see that the argument presented by the Opposition in this House opposing the bill holds any weight. In Committee I will move an amendment to preserve for archive all the material on the venues and facilities that were built, the tenders and contracts. I hope that all those that were not successful will be included in the archive. That will be dependent on those who submitted tenders and designs allowing it to happen. It will be interesting, particularly in the distant future, for people to look back to see how imaginative the designs were. I hope that all members of the House will support the amendment. This has been a historic occasion and as a result of the amendment some of the history will be conserved for a very long time.

The Hon. J. H. JOBLING [12.06 p.m.]: The Opposition believes that the people of New South Wales will be interested when all the bills come in on the Olympics and the results of any litigation are known. The Auditor-General will also be particularly interested. I look forward to his report coming before this House. I will not detail the number of activities that are ongoing but I refer to payment of Olympic financial claims on accounts and the contract finalisation for the key agencies, of which about 4,500 still exist. Post-Games litigation may arise. I understand that SOCOG and Reebok are involved in suing and countersuing activity the results of which are yet to be determined. The Auditor-General will need this type of information to provide a final report to the International Olympic Committee on the cost of the Games. The disposal of the media village, clearance of the site and temporary buildings, the disposal of any other equipment that is there and the decommissioning of stadiums are still to take place. There is also the cataloguing, classifying and placing into protective storage of the Games archives. The Opposition thinks that the amendment proposed by the Hon. R. S. L. Jones in relation to an Olympic archive is a very good idea.

Debate adjourned on motion by the Hon. J. H. Jobling.

WORKERS COMPENSATION LEGISLATION AMENDMENT BILL

Second Reading

Debate resumed from 14 November.

The Hon. R. S. L. JONES [12.09 p.m.]: I support parts of the Workers Compensation Legislation Amendment Bill but point out that there are problems with it . They have been put to us by various individuals and organisations. Yesterday I talked to Garry Brack, the Director of the National Employers Federation and the Executive Director of the Employers Federation of New South Wales. Mr Brack said he was also concerned about the proposal to remove the Workers Compensation Advisory Council. He felt that retention of the council was an important amendment that should be supported. The Law Society of New South Wales, lawyers and others expressed concern that much of the detail will be put into regulations and not in legislation. It seems that lawyers, insurers, employers and employees are experiencing a certain amount of disquiet and they should be given a chance to investigate the ramifications of the legislation.

The bill provides for injury management pilot schemes and the introduction of market incentives for employers to improve occupational health and safety and injury management performance. It also allows for subsequent claims for compensation—after the initial claim is made to the employers—to be made directly to the workers compensation insurer. It provides that commencement of proceedings in the Compensation Court to recover permanent loss compensation constitutes an election to claim that compensation and prevents a claim for common law damages against the employer in respect of the injury concerned. It provides that damages awards for an action founded in breach of contract can be reduced for contributory negligence on the part of the injured worker, as is the case with actions founded in tort.

The Alliance for Victims of Accidents has complained that there has been inadequate time allowed for the consideration of the Workers Compensation Legislation Amendment Bill, both the draft and, in particular, the final version. The alliance wrote to members of the crossbench—and I assume also to the Government—asking that debate be deferred until sufficient, considered analysis of the bill could be achieved. Evolving in late 1999 from the organisation Injuries Australia, the Alliance for Victims of Accidents is a coalition of professional organisations that represents injured people, the service providers who work with them and others with an interest in injured people's rights. The alliance's request for more time to debate the bill has been supported by the Australian Association of Surgeons, the Australian Medical Association, the Australian Plaintiff Lawyers Association [APLA], the Brain Injury Association of New South Wales Inc., Injuries Australia, the Law Society of New South Wales, ParaQuad and the Royal Australian and New Zealand College of Psychiatrists. That request has been denied to date.

In a letter dated 6 September the APLA argued strongly for a reference to the select committee so that the Workers Compensation Scheme could be examined and a report presented to Parliament before any legislation was brought down. APLA argued that amendments to the bill could only amount to tinkerings with fee scales and processes within the current scheme that would not overcome some of the major problem that exist with the present system. APLA cited concerns about employer compliance, problems with assessing rehabilitation outcomes, the role of medical and legal specialists and questions of worker, employer and insurer fraud as being of prime importance and in need of in-depth discussion.

I understand that if this bill were to go ahead, some amendments would be put forward by a member of the crossbench that would convey APLA's concerns. However, even the association has conceded that amendments to the bill are insufficient to rectify problems with the basic system and that is why it has called for an inquiry. Also in September the UnitingCare Employee Relations Service of New South Wales wrote to honourable members urging that an inquiry be supported. The Uniting Church in Australia is a significant employer within New South Wales, employing 30,000 people in various industries, including aged care and child care, schools, hospitals and various community-based activities. It pays approximately $10 million in premiums to WorkCover.

The Law Society has also recommended that the inquiry go ahead rather than the Workers Compensation Legislation Amendment Bill, arguing that the bill is, in effect, only a piecemeal attempt at reform. Most important, the Law Society has argued that debate in the public arena is needed. The bill is very problematic in this regard. Much of the detail and all of the devil is contained in the ability to change regulations, thereby fundamentally changing aspects of the scheme without legislative scrutiny. It seems to be a growing government tendency to put considerable power in the regulations where, as all honourable members know, at times it is quite difficult to address any problems that might arise. There is also no opportunity to debate the regulations in public. The public is less sure of what rules apply and, arguably, has less confidence than if the issues had been determined in the public forum. The Law Society also prepared a document that lists the significant regulation-making powers in the bill. There are 35 clauses in which power is vested in the regulations.

For instance, one section seeks to leave to the regulations the power to specify the number of medical reports that may be admitted in evidence in connection with a claim or any aspect of a claim. It is possible that the regulations could be written to allow for only one medical report to be relied upon, perhaps without good reason. I have received a letter from Moroney Rutter and Mantach, plaintiff lawyers, who comment on the bill. They state that the amendments contained in schedule 4 would have the effect of locking injured workers into an election as soon as they start compensation for section 66 and section 67 benefits. The amendment limits the range of options available to the worker. They criticise schedule 7, which deals with amendments relating to medical reports. They state that the proposed amendment to section 130 of the Workplace Injury Management and Workers Compensation Act is designed to limit the number of medical reports that a worker can obtain and limits the amount of costs recoverable by the worker in connection with medical report fees.

Moroney Rutter and Mantach have said that solicitors acting for workers have a professional responsibility to fully investigate a worker's rights and there should be no limit to the number of reports that can be obtained. In some cases, the worker may have multiple injuries involving various parts of the body and there would be no option but to obtain expert medical opinions dealing with all of the worker's injuries. They state it is a denial of justice to limit the evidence that a plaintiff may put before the court when insurance companies can get as many reports as they wish. The solicitors criticise schedule 8, suggesting that the proposal to include section 79A—exchange of information before conciliation—imposes a requirement for the worker to provide "a list identifying all other evidence that the applicant has that is relevant to the dispute".

The solicitors submit that it is unfair to require a worker to provide "all other evidence". Some of the evidence obtained in a workers compensation case may not be of assistance to the worker's claim. As the law presently stands, they do not have to disclose such material. This section will disadvantage injured workers. They say that section 79A also imposes another penalty upon the worker, namely, if the evidence is not disclosed in the list of the evidence, it cannot be used in proceedings before the conciliator or in the Compensation Court. New section 79A (6) will create disputes, including as to when medical reports were received. The date of the report is not necessarily the date on which it was received. The provision may cause relevant evidence to be inadmissible in court.

The letter states that section 81A requires parties to conciliation to provide copies of evidence before the hearing. It also states that it may not be possible to comply with the section—if, for example, a report was received less than seven days before the conciliation conference—and that it is unreasonable to restrict the evidence available to a court in such circumstances. The letter criticises schedule 23 and states that the proposed amendment to section 88 of the Workplace Injury Management and Workers Compensation Act imposes a limitation in respect of costs in relation to conciliation and that a maximum amount of $500 is imposed. The amendments in schedule 8 makes is necessary for solicitors acting for workers to carry out more work, and there is more responsibility in dealing with the penalty provisions. It is a situation in which the solicitors will be required to do more work for less pay.

The letter further states that new section 88 (4) (b) is also of great concern. The section enables a maximum amount to be set in respect of disbursements that are payable by employers in respect of conciliation matters. This section will be used to target the cost of medical report fees; workers cannot negotiate with doctors about the amount of the report fee and they are forced to pay whatever the doctor wishes to charge. If a worker wishes to claim compensation, he or she has to obtain reports from treating specialists and other medical experts. If the amount allowed in respect of medical report fees is fixed at an amount less than the fee charged by the doctor, it will be the worker who bears the cost of the difference between the two amounts. The section does not affect the insurance company or the employer. Those are matters put to us by solicitors acting on behalf of workers, essentially. I move:

That the question be amended by the addition of the following paragraphs:

I believe that the amendment would be or could be acceptable to the Government, set in light of the fact that the Government controls that committee and no reporting date has been set, thus allowing the committee to determine its own priorities. I believe it is important that the committee now have a look at WorkCover and that it would be very beneficial for all members, particularly the Government, to have this inquiry. It would mean that the next time we have similar legislation before the House it would be based on more information so that everyone can participate, be they workers, employers, or insurers, and the whole matter could be cleared up before legislation comes before the House.

Reverend the Hon. F. J. NILE [12.23 p.m.]: The Christian Democratic Party supports the bill, the object of which is to amend the Workers Compensation Act 1987, the Workplace Injury Management and Workers Compensation Act 1988, and the Workers Compensation (Dust Diseases) Act 1942. It will do that in a number of ways. In speaking in support of the bill I shall make some observations about the point we have reached in the review of the workers compensation legislation and of WorkCover in this State.

The principles on which the Christian Democratic Party works are very simple. One aspect that concerns me at the moment is the principle of allowing the Government to govern. It seems that in recent days there has been more and more sidetracking of legislation and blocking of legislation indirectly by referring it to committees, adjourning it or delaying it. We have reached a situation whereby the Government is not able to implement its program and may come under criticism for not acting in certain areas, such as workers compensation and fisheries.

I am sure honourable members would agree that WorkCover is in a serious state and, as with a patient who has cancer or some other life-threatening disease, WorkCover requires radical surgery. This bill, as we have been told before by the Minister, is part of a series of bills that will bring about that radical surgery and, hopefully, the patient will become healthy; WorkCover will be a healthy activity and will operate efficiently and without any deficit.

There is no doubt that there is also a need to streamline the administration of WorkCover. That is why I have opposed inquiries like the one proposed by Hon. R. S. L. Jones, which affect staff, board members and others involved with WorkCover. They become distracted because they have to deal with a parliamentary inquiry. From my experience as the chair of a number of inquiries I can attest to the fact that a significant amount of time and attention is given by all the key players who have to appear before such inquiries. Focus is taken off trying to solve problems and put onto how they might anticipate questions from the inquiry to make sure they have all the options covered and have all the material that might be requested at the inquiry.

The focus is moved away from solving the problem to virtually handling an inquiry successfully. The inquiry might be handled successfully, but in the meantime WorkCover has not progressed one step forward. In Committee I will move an amendment to the Opposition's amendment which will bring WorkCover within the operation of the Standing Committee on Law and Justice, but it will not involve a full-scale inquiry as that proposed by the Hon. R. S. L. Jones in his amendment. The amendment will be in the following terms:

That amendment will give the overall role of investigation to the Standing Committee on Law and Justice. It will give the committee something it does not have: expertise. An independent evaluation by a person or organisation has been provided on other occasions. During past inquiries Legislative Council members of committees have had to engage consultants and others for the purposes of a report because the members realised they did not have the necessary expertise. Obviously, on this occasion the costs associated with this inquiry would be levied against the Standing Committee on Law and Justice and/or the Legislative Council.

My proposal is that the cost be met by the Government, through WorkCover, and not involve the budget of the upper House or of the Standing Committee on Law and Justice. I foreshadow that amendment, which can be compared to one moved by the Hon. R. S. L. Jones. I want everyone involved with WorkCover, including the Minister, to focus all their attention on solving the problems and on bringing WorkCover under control, with reasonable premiums, and so on. That has been achieved, as far as humanly possible, with the Motor Accidents Authority and motor accident compensation. This House should not block this important restructuring.

On Tuesday the Law Society, when briefing certain members of this House, raised a strange point of view, almost a suspicion, about whether WorkCover is in as bad a position as claimed. I was surprised that the Law Society implied that WorkCover was reasonably healthy and not subject to such a deficit. We have heard about a $2 billion deficit, but that may be down to $1.6 billion. However, no-one doubts that WorkCover is in a financially dangerous position. Obviously, if the Law Society or members of the legal profession can convince us that WorkCover is not in a perilous state, the Government need not take expensive action to review it.

One reason for reduction of legal costs is the possibility, it is claimed, of a blow-out; if there is no blow-out there is no necessity for that action. I would be concerned if the Law Society were trying to promote a point of view which protects the financial interests of its members who might become involved in compensation cases. Lawyers can seek financial benefit through such cases. I ask the Government to put clearly on the record, while the bill is being debated in this House, the current financial position of WorkCover. Obviously, if there is a deficit of $1.6 billion, that is a serious issue.

Reduction of the deficit, and hopefully elimination of it, would involve a number of steps. This bill, as part of that reform process, will achieve that purpose. I support the involvement of the Occupational Health and Safety Council and the proposal to combine it with the Advisory Council. Obviously, a major way of reducing the scheme's cost is by reducing the incidence of accidents, so that workers can go to their workplace, engage in employment, and return home safely. I am sure we were all impressed with the WorkCover television advertisements which focused on that point. The advertisements showed a wife farewelling her husband as he went to work and expecting him to return home safely.

As a member of the law and justice committee I visited a BHP site and a company in Melbourne that was involved in producing airconditioning units for Toyota. That company had established a model factory in which an accident was almost impossible because of the safety measures it had introduced. The company spent a lot of time and money doing that, but that expenditure would have been offset by fewer accidents and, hopefully in the long run, a reduction in premiums. I see no problem in the proposal to combine the Advisory Council and the Occupational Health and Safety Council. I am not as worried as other members of the crossbench and the Opposition about the powers of the Advisory Council. It has been in existence for some years and does not appear to have produced any major solutions.

Although the Advisory Council allows consultation, as each stakeholder is concerned about its area of interest a deadlock is reached. In other words, unions may not want to proceed where its members might be affected, and lawyers may not want to proceed if their income will be reduced. Consultation and agreement are more than acceptable if a solution is achieved. However, if a solution is not achieved, the Advisory Council may cause delays in the reforms that the Government is trying to introduce. I do not see that as a problem. The Christian Democratic Party supports the bill with that proviso.

We support the bill's attempts to reduce, and hopefully eliminate, false claims and other forms of fraud. We agree with the provision that medical assessors should be approved or certified, so that lawyers do not retain only those medical practitioners who will give a favourable decision. We need professional people who have no axe to grind and can report accurately on the injury experienced by the worker. The legal profession must be prohibited from advertising or touting for business. We have all heard radio advertisements in which WorkCover has required the inclusion of a statement that large penalties will be incurred for claims that are not genuine. The emphasis in those ads is on touting for business. Lawyers may offer deals at no charge if they can get a large percentage of the compensation payout. That offer could encourage people to become involved in cases in which normally they would not be involved.

The legislation is moving in the direction of mediation rather than confrontation, and that is the way to go. Confrontation involves more legal costs. We should develop methods of achieving reconciliation and mediation and a solution to the compensation problem. The principles involved in investigation of motor accident compensation should be applied to investigation of workers compensation in an attempt to phase out bulk payments and replace them with total care and periodic payments to workers. That would require the co-operation of the unions, which I am sure could be negotiated by the Government.

The bill focuses on the importance of rehabilitation, which the Minister has mentioned on a number of occasions in this House. Rehabilitation must be more effective and efficient so that workers are not out of the workplace for up to three years. Workers need to return to full employment in some form or other. Workers who are in long-term rehabilitation programs, or who are not able to work for some other reason, should be assessed regularly to ensure they have not been forgotten and left on workers compensation year after year. That is certainly not in the interests of the workers or taxpayers of this State.

Employer groups have briefed members of this House. They appeared to be agreeable in principle to the legislation and there has been no dramatic lobbying for delay or amendment of the bill. However, premiums are a problem for industry. I hope that the Government will follow through the initiative of basing premiums on a company's safety record. Companies that have a good safety record and have dramatically reduced workplace injuries should benefit from discounted or lower premiums.

Companies with a high level of accidents should pay higher premiums. So employers who do the right thing will benefit from their actions, and there is incentive for employers to make their workplace safe. Further, premiums should be fair and reasonable. The Christian Democratic Party supports the bill. Often, those in Opposition do not want the Government to succeed because it will get the credit. That is part of politics. In this case, we should develop a bipartisan approach, as we have in the Aboriginal issue, and be more co-operative so that we deliver the best possible workers compensation package for the workers of this State.

The Hon. J. J. DELLA BOSCA (Special Minister of State, Minister for Industrial Relations, Assistant Treasurer, Minister Assisting the Premier on Public Sector Management, and Minister Assisting the Premier for the Central Coast) [12.40 p.m.], in reply: I thank honourable members for their contributions to the debate. As previously outlined, the Workers Compensation Legislation Amendment Bill is the first in a series of legislative packages to be presented over the next 12 months by the Government to reform the WorkCover scheme. Substantive matters will be dealt with in the second and third legislative packages as the Government reviews progress.

The main provisions of the bill have already been outlined in detail. Some specific points that were raised during consultation on the bill should also be noted. Item [5] of schedule 21 provides that the employer is entitled to recover interest where a premium has been incorrectly calculated and the employer has paid too much premium. The provisions will allow interest to be recovered from the date that the incorrect premium was originally paid. Insurers will be advised through normal administrative process by WorkCover to make the payment of interest from that date.

The Advisory Council was established following the Grellman inquiry into the New South Wales workers compensation scheme. Mr Grellman found at that time that stakeholders felt that fundamental changes to the system were often made without their consultation, despite the impact of change. The Advisory Council in its early months endorsed the Grellman inquiry recommendations, which resulted in the 1998 Act. Since April 1998, the council has sought to play a role in identifying initiatives to improve the scheme. The 1998 reforms which followed from the Grellman report, and which were endorsed by the Advisory Council, have resulted in savings and a slowing in growth in the deficit.

However, these reform initiatives have, in effect, stalled and further reform is necessary. Accordingly, the Advisory Council recommended in 1999 that the commencement of private underwriting be deferred while further scheme reforms were developed. The Advisory Council identified a number of possible areas for reform at that time, although further detailed work was required to identify actual changes. The Advisory Council provided further advice in August 2000 about reform options. This was broadly similar to those proposals provided in 1999.

Despite all this, there has been a failure to reach agreement on fundamental scheme reform in areas such as dispute resolution. The only recommendation from the Grellman inquiry that was fully implemented was the proposal to establish the stakeholder body, that is the Advisory Council. The Grellman report recommended a need for further reform in key areas such as dispute resolution, improved medical management, simplified legislation and the introduction of private underwriting. Almost three years after the Grellman report and two years after the establishment of the Advisory Council, the council has been unable to agree as to how to best progress reforms in these areas. The only area where significant progress has been made is in relation to improved injury management.

It is now apparent that consensus will never be reached on further reform. There is a need for firm decisions on further scheme reform. I have already announced a detailed statement of strategic directions, which has identified priority areas for reform. It is my intention to deliver reforms that meet all these objectives. The Government has identified the need for a broader range of initiatives. These include the need for improved dispute resolution arrangements, improved injury management performance, strategies to improve compliance and strategies for managing the deficit. Since the statement was made in June 2000 substantial progress has been made on implementing the strategic directions for the scheme.

The WorkCover Authority is at an advanced stage in the tendering process for both the injury management pilot and the general practitioner training pilot. The changes to the corporate governance arrangements for the scheme will ensure that the reform program is able to continue in an effective and timely fashion. This bill reconfirms the Government's commitment to consult with all key interest groups, including employers, employees and service providers in the further development of scheme reform. However, the bill puts in place arrangements consistent with the principle of ministerial responsibility to ensure that the Government is able to show the leadership sought by stakeholders on bringing about sustained reform to the scheme.

Prevention of workplace injuries should be the priority area in reducing the financial and social cost of workplace injury. Rather than focusing on the entitlements of an injured worker, it is preferable to respond to the causes in the workplace that result in injuries in the first place. The priority that the Government is giving to prevention is highlighted by the recently released Occupational Health and Safety (Consolidated) Regulation. Concerns have been raised that the consideration of occupational health and safety issues will be undermined through the merger of the Advisory Council and the Occupational Health and Safety Council. The important role that both bodies have played, particularly the Occupational Health and Safety Council in relation to workplace safety, cannot be underestimated. The intention of the proposed merger of the two bodies is to give greater priority to occupational health and safety issues.

By establishing a single body responsible for providing advice on all aspects of the WorkCover schemes, the Government will obtain co-ordinated advice, which looks at all aspects of a proposal or problem. This is an increase in status for occupational health and safety matters. Further, a specific position has been reserved for an occupational health and safety expert. Nominating organisations, particularly employer and employee groups who nominate representatives to the council, have a responsibility to ensure that there is also additional occupational health and safety expertise available to the council. WorkCover will be able to establish consultative bodies for specialist expertise on specific issues, including occupational health and safety issues. There will be no decrease in status for occupational health and safety issues. This is consistent with the Government's broader objective of injury prevention.

The Leader of the Opposition seems to believe that not continuing the Rating Bureau in its current form is a sinister plot. It is nothing so interesting. The Rating Bureau was established under the 1998 Act for the purpose of determining premiums under the privately underwritten scheme. With the deferral of private underwriting it is unnecessary for the bureau to continue to carry out the functions of monitoring scheme performance and preparing costings on legislative proposals. This will reduce unnecessary expenditure. These functions are already carried out by the WorkCover Authority through its actuaries. The Auditor-General provides an independent review of scheme valuations. The appropriate role of the Rating Bureau can be reviewed after a decision is made in relation to private underwriting.

The Leader of the Opposition has also suggested that the bill does not deal with the previously announced premium discount scheme. Schedule 2 of the bill contains the enabling provisions for the scheme. The regulations will set out the detail of the proposed scheme, including the conditions on which discounts will be awarded. Regulations are subject to disallowance by Parliament. Consultation is set to commence shortly on the details of the premium discount scheme. The proposed scheme allows an employer to receive a premium discount up-front in the premium year. This is deliberate, as the Government wants this scheme to reward employers for their current and future behaviour in occupational health and safety and injury management, not punish them for their past claims.

However, employers do not get the discount for nothing. It is only when they have met certain occupational health and safety and injury management benchmarks that they get to keep the discount. Employers participating in the scheme will receive a discount on their premium on commencement. This will free up funds to make it easier for them to put occupational health and safety and injury management systems in place. However, if during the year they fail to meet the performance benchmarks, the discount can be recovered through a premium adjustment at the end of the year.

The reforms in the 1998 Act relating to injury management have generated improvements in the underlying cost of the scheme. However, these reforms have stalled and there is a need for further initiatives to generate improved injury management outcomes. The pilots will assist in identifying best practice. It is central to the Government's strategy that it focus on better return to work outcomes to generate savings, rather than cut benefits. The Leader of the Opposition has also raised the issue of previous injury management pilots. WorkCover conducted an industry rehabilitation co-ordinator pilot with two industry organisations—the Australian Industry Group and Australian Business Limited. These projects only dealt with a sample of 17 workers. That sample is not large enough from which to draw any significant conclusions or findings.

The injury management pilots are to be the subject of comprehensive and rigorous evaluation. Each pilot will be overseen by a steering committee, which will involve relevant stakeholders. The evaluation will be conducted in a variety of ways by WorkCover's actuaries, by WorkCover's statistical branch and by external expert parties, for example, Campbell's National Return to Work Monitor. The evaluation process will be collated, analysed and validated by an independent body selected through a competitive selection process. The evaluation will cover cost-benefit analyses of the pilots and their application to the scheme as a whole; differences in service utilisation and costs and differences in the return to work outcomes for injured workers; user satisfaction with the pilots provided; and comparison of return to work rates and durability of employment for the pilot population against New South Wales and national results.

The legislation currently asks injured workers to choose between statutory lump sum compensation and common law damages. The proposed amendment does not change this requirement. It merely requires that the worker make a choice before starting proceedings in the Compensation Court. Obviously, two sets of proceedings for a single injury are more expensive than one. Even if the amendment means that counsel's opinion is sought at an earlier stage, it will be less expensive than running two cases. This reform will not disadvantage seriously injured workers who wish to pursue common law damages. Lawyers will continue to provide advice to their clients to enable them to make informed decisions about whether to pursue common law damages.

The intent of the proposal relating to medical reports is to reduce the number of unnecessary reports obtained in disputed claims. While there are already some provisions in the current legislation that deal with a recovery of costs for medical reports, these are limited in their operation. Similar restrictions are in place in the District and Supreme courts. Although the final regulation is still subject to consultation it is proposed that the motor accidents approach be used when the parties are generally entitled to one report per specialty to support their claim. In some cases a further report may be obtained. It is proposed to give effect to this amendment by regulation to allow close consultation with scheme participants.

The proposal is not intended to limit the treatment provided to an injured worker, and this will be given close attention when the regulation is being drafted. The legal profession has raised significant objections to the proposals to require information to be exchanged prior to conciliation. These reforms are about getting injured workers their compensation in an appropriate time frame. The intent of the provisions is to ensure that all available information is made known and is available, subject to normal rules relating to privilege. This will ensure that parties can make informed decisions to settle matters. By identifying all the evidence the conciliator will be able to order that the evidence be produced, subject to any exemptions.

Although the objections relating to identification of all evidence in the possession of the parties have been noted, it must be recognised that when the matter proceeds to court the material can be identified through the discovery process. Disclosure is not sought at an early stage but when resolution can be achieved through conciliation. To consider this to be an early stage is to promote the proposition that matters must be resolved at the Compensation Court after a very lengthy delay rather than through more immediate conciliation. The only people who benefit from matters proceeding to a full hearing before a court are those who participate in the dispute resolution process. The proposed amendments will increase WorkCover's capacity to recover premium debt from employers by allowing unpaid premiums to be recovered from corporations.

The amendment is aimed at directors of corporations who seek to gain financial advantage by knowingly avoiding their workers compensation obligations. This liability extends only to culpable directors within the meaning of the bill. It is not appropriate to extend liability to all directors as this will conflict with the principal purpose of the Corporations Law. Directors who generally attempt to do the right thing should not lose the protection of limited liability. The proposed amendments vary section 145A of the Workers Compensation Act 1987, which was introduced to enable WorkCover to recover debt arising from claims lodged under the uninsured liability and indemnity scheme from the directors of uninsured corporations.

Certificates of currency provide a mechanism for employers and unions to check the insurance coverage of other employers. It is particularly useful in industries where there is a high degree of labour mobility and extensive use is made of subcontracting arrangements. The provisions of the bill require insurers to issue a certificate on request. The certificates are valid for four months only, at which time the new certificate may be issued. Employer groups have noted that the certificates of currency provided for under schedule 13 to the bill are required to include wage and employee details. This information is, of course, used by the authorised officer to determine whether the correct premiums have been paid.

It has been noted that this information may be commercially sensitive. I am advised that section 243 provides that a person who acquires information while administering or executing the Act must not disclose that information, except in limited circumstances. This would apply to a union official or contractor who exercises a right to view a certificate, although that person would be able to advise the WorkCover Authority of any discrepancy. The authority will give detailed consideration to requiring insurers to include a statement on the certificate outlining the obligations under section 243.

The Hon. M. J. Gallacher: Thank goodness we brought that to your attention.

The Hon. J. J. DELLA BOSCA: That is very kind of the honourable member. The legislation imposes a range of obligations on parties, and provides a sanction if those obligations are not fulfilled. Similarly, most licensing systems create offences and have a broad range of sanctions for breaches of licence conditions. These provisions are based on similar provisions in the Motor Accidents Compensation Act 1999, although there are some procedural modifications. Insurers have obligations in the workers compensation scheme. This provision merely allows for a streamlined process to provide a sanction when an insurer does not fulfil his or her obligations.

Before imposing a sanction the board is required to provide the insurer with an opportunity to make submissions. Prerogative relief is available in those cases where principles of natural justice are not observed. The proposal to reopen the specialised class of licence has been the subject of much consultation. The proposed amendments provide stringent criteria for obtaining such a licence. For example, the proposed specialised insurer will have to demonstrate that it will not have an adverse effect on the efficiency of the scheme. It will be limited to a particular industry, class of business or employer, and must be supported by the relevant industry bodies. The applicant must also meet Federal licensing requirements.

The bill contains provisions that enable exiting specialised and self-insurers to contribute to the deficit under the 1987 Act. There are already similar provisions in the 1998 Act. It is not part of the Government's proposal to levy all employers, as has been suggested. The Government is reinforcing the principle that employers who seek to exit the scheme should now contribute to their unfunded liabilities. The amendments, including the provision to make agreements with WorkCover that will allow exiting employers to take their so-called tail, will allow this to happen. The Opposition has noted that nothing in the bill deals with advertising or fees. Maximum fees can be set under the existing provisions of the legislation without the need for further amendments.

The Hon. R. S. L. Jones moved an amendment to the second reading of the bill. The Government is strongly opposed to that amendment. Workers compensation arrangements have been reviewed at least 16 times in the past six years. The time for another review has passed. The Government has outlined its strategic directions for the scheme and has in place a comprehensive reform strategy. The bill is the first in a series of legislative packages to be presented by the Government. The second and third package to be presented next year will deal with more substantive reform issues. The bill was tabled before the House in draft form more than four weeks ago, on 10 October. The second reading speech on the bill took place two weeks ago, on 1 November. Honourable members have had extensive periods in which to consider the provisions of the bill, consult with stakeholders and suggest changes.

The Hon. M. J. Gallacher: When are you going to do your homework?

The Hon. J. J. DELLA BOSCA: I assume the honourable member did his homework. Given the time that has been made available for consideration of the bill, it is difficult to see whether another review would add significant value. Referral of this matter to the law and justice committee will delay the Government's reform program. The injury management pilot may not be able to commence on 1 January 2001. It will also delay progress on the premium discount scheme, on which detailed consultation is soon to progress. The Parliament has demanded that the Government take action to repair the scheme, yet the motion before this House will frustrate that reform. Such a review will also delay the subsequent reform packages to be presented next year. Employers will benefit from higher premiums for a longer time. In these circumstances it is unreasonable for the honourable member to place the matter before the House.

Question—That the amendment be agreed to—put.

The House divided.

Ayes, 15

Mr Chesterfield-Evans
Mr Colless
Mr Corbett
Mrs Forsythe
Mr Gallacher
Miss Gardiner

Mr Gay
Mr Harwin
Mr R. S. L. Jones
Mr Oldfield
Mr Pearce
Dr Pezzutti

Mr Ryan

Tellers
Mr Jobling
Mr Moppett

Noes, 21

Mr Breen
Ms Burnswoods
Mr Cohen
Mr Della Bosca
Mr Dyer
Mr Egan
Ms Fazio
Mr Hatzistergos

Mr M. I. Jones
Mr Kelly
Mr Macdonald
Mrs Nile
Reverend Nile
Ms Rhiannon
Ms Saffin
Mrs Sham-Ho

Mr Tingle
Mr Tsang
Mr West

Tellers
Mr Johnson
Mr Primrose

Pairs

Mr Lynn	Mr Obeid
Mr Samios	Ms Tebbutt

Question resolved in the negative.

Amendment negatived.

Motion agreed to.

Bill read a second time.

[The President left the chair at 1.10 p.m. The House resumed at 2.30 p.m.]

In Committee

Clauses 1 to 4 agreed to.

Schedule 1

The Hon. M. J. GALLACHER (Leader of the Opposition) [2.33 p.m.]: I move Opposition amendment No. 1:

Industrial Relations Act 1996

I take umbrage at the suggestion by the Minister for Industrial Relations that the Opposition is being anti-union with this amendment. It is designed to provide balance in the make-up of the amalgamated council. The Minister's proposal is that the council have five persons appointed by the Minister as employee representatives from a panel of at least six persons nominated by the Labor Council of New South Wales, one being appointed to represent injured workers. I made the point last night that only 25 per cent of New South Wales employees are covered by unions and the Labor Council of New South Wales. We believe that the other 75 cent should be represented in this equation, but there is no provision in schedule 1 for their representation.

The amendment is not designed to take away responsibility or power from the Minister. Under the amendment the Labor Council would still have a significant role—much larger than the 25 per cent of employees that it represents would justify. The Minister will be able to decide on the suitability of people appointed to the new council, and the Opposition does not believe that at this stage that power should be removed. We simply want to mirror what is occurring in the workplaces of this State and give people who have made a choice not to be members of a union—75 per cent of the workers of this State—the assurance that their voices will be heard on the council. The final point I make is that the provision that one person on the council be appointed by the Minister to represent injured workers is consistent with the original proposition for membership of the council. Again, the Minister would have sole responsibility to select the person to be appointed. The person would not be chosen by the Labor Council.

The Hon. J. J. DELLA BOSCA (Special Minister of State, Minister for Industrial Relations, Assistant Treasurer, Minister Assisting the Premier on Public Sector Management, and Minister Assisting the Premier for the Central Coast) [2.37 p.m.]: The proposed amendment seeks to reduce the reasonable role given by the bill to the Labor Council in providing a panel of nominees for appointment to the proposed new council. The amendment is inappropriate as the Labor Council is the peak worker representative and peak union body in New South Wales. The Leader of the Opposition may take umbrage at the suggestion but his party's concern about this matter is driven more by ideology than by a determination to reform the scheme.

Question—That the amendment be agreed to—put.

The Committee divided.

Ayes, 14

Mr Colless
Mrs Forsythe
Mr Gallacher
Miss Gardiner
Mr Gay

Mr Harwin
Mr M. I. Jones
Mr Lynn
Mr Oldfield
Dr Pezzutti

Mr Ryan
Mr Samios
Tellers,
Mr Jobling
Mr Moppett

Noes, 25

Mr Breen
Dr Burgmann
Ms Burnswoods
Dr Chesterfield-Evans
Mr Cohen
Mr Corbett
Mr Della Bosca
Mr Dyer
Mr Egan

Ms Fazio
Mr Hatzistergos
Mr Johnson
Mr R. S. L. Jones
Mr Macdonald
Mrs Nile
Reverend Nile
Mr Obeid
Ms Rhiannon

Mrs Sham-Ho
Mr Tingle
Mr Tsang
Mr West
Dr Wong

Tellers,
Mr Primrose
Ms Saffin

Pair

Mr Pearce

Ms Tebbutt

Question resolved in the negative.

Amendment negatived.

Question—That the schedule be agreed to—put.

The Committee divided.

Ayes, 20

Dr Burgmann
Ms Burnswoods
Mr Della Bosca
Mr Dyer
Mr Egan
Ms Fazio
Mr Hatzistergos

Mr Johnson
Mr M. I. Jones
Mr Macdonald
Mrs Nile
Reverend Nile
Mr Obeid
Mrs Sham-Ho

Mr Tingle
Mr Tsang
Mr West
Dr Wong
Tellers,
Mr Primrose
Ms Saffin

Noes, 19

Mr Breen
Dr Chesterfield-Evans
Mr Cohen
Mr Colless
Mr Corbett
Mrs Forsythe
Mr Gallacher

Miss Gardiner
Mr Gay
Mr Harwin
Mr R. S. L. Jones
Mr Lynn
Mr Oldfield
Dr Pezzutti

Ms Rhiannon
Mr Ryan
Mr Samios

Tellers,
Mr Jobling
Mr Moppett

Pair

Ms Tebbutt

Mr Pearce

Question resolved in the affirmative.

Schedule 1 agreed to.

Schedule 2

The Hon. M. J. GALLACHER (Leader of the Opposition) [2.51 p.m.]: I move Opposition amendment No. 2:

No. 2 Page 19, schedule 2 [2], lines 21-25. Omit all words on those lines.

This is consistent with Opposition amendment No. 3, which the Committee will shortly debate. It is extremely important that this amendment is dealt with before the next amendment.

The Hon. J. J. DELLA BOSCA (Special Minister of State, Minister for Industrial Relations, Assistant Treasurer, Minister Assisting the Premier on Public Sector Management, and Minister Assisting the Premier for the Central Coast) [2.52 p.m.]: The amendment seeks to replace the regulation-making power in the bill regarding the review of premium discount systems with a specific provision of the Act, which is inappropriate. The proposal is very broad and workable and will allow insurers and employers to dispute any proposed premium discount scheme, not only in a situation where the particular employer or insurer is directly affected. It would, for example, allow insurers to dispute discounts agreed with employers, or employers to dispute administrative procedures established for the smooth operation of the discount scheme.

The Administrative Decisions Tribunal [ADT] examining a one-off case would not be in a position to consider the broader implications for the whole of the WorkCover scheme. As the Leader of the Opposition has indicated, the two amendments—the one he has moved and the one I assume he intends to move shortly—are very closely linked. My remarks apply to both.

Amendment negatived.

The Hon. M. J. GALLACHER (Leader of the Opposition) [2.53 p.m.]: I move Opposition amendment No. 3:

(8) An insurer or employer who is aggrieved by any decision of the Authority under this section may apply to the Administrative Decisions Tribunal for a review of the decision.

This amendment relates to what I consider to be yet another oversight by the Government with respect to an aggrieved insurer or employer who has difficulty following the decision made by the authority. The amendment puts in place an appeals process that enables the aggrieved insurer or employer to take a matter to the Administrative Decisions Tribunal for a review of the decision. As it currently stands no such process is available and the application of this amendment to the bill will add to the integrity of the legislation.

The Hon. J. J. DELLA BOSCA (Special Minister of State, Minister for Industrial Relations, Assistant Treasurer, Minister Assisting the Premier on Public Sector Management, and Minister Assisting the Premier for the Central Coast) [2.54 p.m.]: The remarks I made during consideration of the previous amendment are applicable to consideration of this amendment. As the Committee has already expressed a view on the earlier amendment I seek its support to reject this amendment.

Amendment negatived.

The Hon. M. J. GALLACHER (Leader of the Opposition) [2.54 p.m.]: I move Opposition amendment No. 4:

1 2 year pilot scheme

The injury management pilot project proposed by the Government in this legislation will put in place a two-year pilot scheme. In his reply to the second reading debate the Minister spoke about the need for scrutiny and some examination of the process, and in fact made reference to an investigation to be conducted by independent persons or organisations at the conclusion of the two-year period. This is really breaking new ground and the Opposition is seeking a full and open examination of this proposal before the Parliament at some stage. The Opposition recognises that some time will elapse before the commencement of the two-year period, thereby ensuring that the conclusion of the two year period—the end of the sunset clause—will in fact occur after the next State election. That will eliminate any opportunity for this issue to be politicised, or at least the allegation that the issue has been politicised, by either side in the debate.

With regard to the two-year pilot scheme sunset clause, the Opposition is seeking to add to the provisions of the bill to ensure that, at the end of the two-year period—in conjunction with what the Minister has said in regard to the scrutiny of the scheme that will be undertaken by the independent persons or organisations—the effectiveness of the scheme will be reviewed by the Legislative Council Standing Committee on Law and Justice, which will report back to Parliament on the success or otherwise of the scheme.

Reverend the Hon. F. J. NILE [2.56 p.m.]: The Christian Democratic Party agrees with what the Opposition is seeking to achieve, but I believe the amendment that I propose to move now will be better than what the Opposition has proposed in its amendment No. 4. I move:

The Government has agreed that there will be evaluation. That was stated by the Minister in his reply to the second reading debate on the bill, and the evaluation that the Government has referred to would be conducted in a variety of ways by WorkCover actuaries, by the WorkCover statistical branch, by external expert parties, such as Campbell's National Return to Work Monitor. This evaluation process would be collated, analysed and validated by an independent expert body selected through a competitive tender process.

That is the point I am emphasising in my amendment. It must be an independent evaluation so that there can be no accusation that the Government has manipulated the evaluation. It will be independent of the Government, but the evaluation will cover the cost benefit analysis of the pilots and their application to the scheme as a whole; the differences in the service utilisation and costs; differences in return to work outcomes for injured workers; user satisfaction for the pilot providers; and comparison of return to work rates and durability of employment for the pilot population against New South Wales and national results.

The amendment moved by the Opposition simply states that the effectiveness of this schedule be investigated by the Legislative Council Standing Committee on Law and Justice. I want to ensure that that committee has the benefit of expert advice. The committee comprises members of this House and is chaired by the Hon. R. D. Dyer. The committee members are very effective and efficient, but are not experts on all the details of the WorkCover scheme.

The Standing Committee on Law and Justice needs an expert report that it can consider to enable it to report to the House. Through the committee the House will have a monitoring process. It will review the results of the evaluation and report to Parliament. My amendment will achieve, in a better and more effective way, what the Opposition is attempting to achieve. It will equip the Standing Committee on Law and Justice with expert knowledge, which is the information it needs. If my amendment is not agreed to, the committee will have to hire consultants or other persons, who will be a charge against the committee and/or this House. Under my amendment the Government will bear all the costs of the evaluation process by an independent evaluator. The Hon. R. D. Dyer is nodding his head in agreement.

The Hon. R. D. Dyer: I don't want to pay for it.

Reverend the Hon. F. J. NILE: That is what I am saying. From a financial point of view this is a more efficient and effective way for the House to operate.

The Hon. M. J. GALLACHER (Leader of the Opposition) [3.01 p.m.]: I seek a point of clarification from Reverend the Hon. F. J. Nile. What is meant by the words "chosen by the authority by private tender"? How is it intended to place advertising to get the private tender under way? Who will fully examine the value of the system?

Reverend the Hon. F. J. NILE [3.02 p.m.]: WorkCover would have to seek tenders.

The Hon. D. J. Gay: Why is it a private tender? Surely it is a government tender.

Reverend the Hon. F. J. NILE: The emphasis is on private tender. The people who apply will be from private industry. Private tender means private industry. It will be advertised publicly; it will not be a division of WorkCover that will conduct the evaluation. It will be independent. That is where the emphasis will be—independent. Private in this sense does not mean secret; it means that private industry will have the opportunity to tender to carry out the evaluation.

The Hon. D. J. Gay: So it will not be a private tender; it will be an open tender.

Reverend the Hon. F. J. NILE: Yes, an open tender, not a private tender.

The Hon. J. J. DELLA BOSCA (Special Minister of State, Minister for Industrial Relations, Assistant Treasurer, Minister Assisting the Premier on Public Sector Management, and Minister Assisting the Premier for the Central Coast) [3.03 p.m.]: The Government supports the amendment proposed by the Christian Democratic Party. The injury management pilot will provide new information that will assist in identifying possible improvements to the injury management provisions of the current legislation. The Government welcomes the opportunity for the law and justice committee to review the evaluation of the pilot project and make suggestions for improvements to the scheme. The amendment is supported. The Government does not support the earlier amendment in its original form moved by the Leader of the Opposition.

Amendment of amendment agreed to.

Amendment as amended agreed to.

Progress reported from Committee and leave granted to sit again.

SYDNEY 2000 GAMES ADMINISTRATION BILL

Second Reading

Debate resumed from an earlier hour.

The Hon. G. S. PEARCE [3.05 p.m.] (Inaugural speech): I speak against the Sydney 2000 Games Administration Bill, which exemplifies all that is wrong with the Carr Government: the arrogance, the lack of ideas and initiatives, the absence of accountability, and the terror of scrutiny. Who would have guessed that when the great John Fahey-led Coalition Government and the city of Sydney won the right to host the 2000 Games we would have the best Games ever and the best ever Paralympic Games. Thanks to the fantastic organising work of all the SOCOG people we have had the best Games ever. The transport, organised by Olympic Roads and Transport Authority [ORTA] was fantastic. ORTA made the trains run on time. The volunteers and the people of New South Wales and Australia made the Games a great success.

This bill is an attempt to rewrite history, to eliminate the witnesses, to bury the records, to bury the carcass before the body is cold, to seal the mine before the workers get out, to sweep the road before the dust settles. This is a crass attempt to claim all the credit, all the glory, for Minister Knight and the Carr Government. The success of the Olympic and Paralympic Games is an inspiration—the proof of the greatness of our political system and our Australian people. That we could aspire, win and deliver are a great inspiration for me to be here. It is a great honour to be selected by the Liberal Party to represent the people in this Chamber, and it is a great honour to replace a fine man,