Committee Consideration of the Bills
Evidence Received
The Committee received 11 submissions in relation to the Bills (Appendix
1). The Committee held one public hearing at Parliament House, Canberra
(Friday 7 March 1997). Witnesses who gave evidence at the hearing are
listed in Appendix 2.
General Issues Raised in Evidence
Emphasis was placed on the abolition of the Bureau of Industry Economics
and EPAC leaving only one organisation to provide economic advice to Government.
Concern was expressed that the Productivity Commission, as the sole advisory
body, would therefore have a monopoly on advising Government on economic
issues [7] and that governments receiving
advice from only the one source would reflect the views of that agency.
It was widely noted that sound economic and social policy requires a variety
of credible sources of advice to Government [8]
and that government is better served by having people who have some particular
understanding and experience in the areas which they are called upon to
investigate. [9]
The Productivity Commission will retain the functions of the Industry
Commission and in addition be given full authority to examine restrictive
labour market practices that retard productivity. [10]
The ACTU believed that the Treasury's authority over the Industry Commission
affected the outcome of Industry Commission inquiries. Concern was expressed
regarding Treasury's influence over the Productivity Commission and that
the Commission would report according to Treasury views. [11]
The Public Transport Union requested that EPAC remain within Prime Minister
and Cabinet to provide a separate line of advice from Treasury. [12]
- "The Commission should be an independent, credible authority
which receives input from the various interested parties, which will
of course present their particular perspective and indeed vested interests
for the Commission's consideration. The Commission should then objectively
analyse these imputs and draw a balanced conclusion on the basis of
the overall input received." [13]
The Industry Commission was heavily criticised regarding the ability
of officers to conduct inquiries in various fields of expertise, where
those officers may not have the appropriate knowledge to come to a satisfactory
conclusion. [14]
- "The reform process would be better served by inquiries
involving those with credibility, expertise and knowledge of the specific
industries than the ideologically driven 'one size fits all' approach
of a body such as the Productivity Commission." [15]
The ACTU promoted an increase in non-profit research bodies within
the community capable of providing advice to Government on economic
issues.
The government has abolished the National Board of Employment, Education
and Training, which was an advisory body to government specifically in
relation to education. While the Australian Education Union, as an independent
body, submits advice to the Government on economic issues, the ACTU believes
the Productivity Commission will be ill equipped to provide advise in
the educational field. [16]
The Australian Chamber of Manufacturers suggested that a Council of the
Productivity Commission be established within the Bill. The Chamber argued
that the establishment of the Council would overcome some concerns regarding
the availability of advice from various industries. The Council could
comprise representatives of business, academia and consumers appointed
by the relevant Minister. [17]
Specific Issues
There were several specific issues raised at the hearing and in submissions
to the Committee, including the following points.
- The ACTU expressed concern regarding the Productivity Commission's
report, Stocktake of micro-economic reform. The ACTU believed
the Productivity Commission has already anticipated the results of future
inquiries it may undertake. [18] The
ACTU also expects the Commission, in relation to public sector agencies,
to privatise , contract out, install user pays practices, reduce cross-subsidies,
and discount social functions performed by such agencies. [19]
The Federation of Parents and Citizens Associations of New South Wales,
also expressed concern regarding the Productivity Commission's first report,
stating that they believed it extended Competition Policy to school education
even though schools are not within the business activity of government.
[20]
- "...The initial report on Competition Policy excluded education.....but
now we seem to find education sneaking into this market theory, competition
policy. Education is not a market. Education is about life that you
have for all people in this country. It is not a competition."
[21]
- Part 7 of the Bill incorporates imprisonment and fines for persons
failing to attend hearings or provide information to the Productivity
Commission. The Australian Chamber of Manufactures believes that, while
such penalties may be appropriate when considering inquiries concerning
a "competitive neutrality complaint", they may be too excessive
for more routine inquiries. [22]
The ACTU stated that certain parties boycott the Industry Commission
and its inquiries, due to their belief that the Industry Commission only
reflects its own view despite evidence taken at public hearings. [23]
If boycotting the Productivity Commission occurred for these reasons,
the Commission could compel parties to provide evidence in support of
its inquiry.
The current legislation provides for a defence, in relation to the withholding
of information, if the action of the person may incriminate that person
or make the person liable for forfeiture or penalty. [24]
The proposed legislation excludes this provision.
- Noted was the Chairman of the Productivity Commission having the power,
in the event of a disagreement, to rule on a question arising from a
meeting. [25] Concern was voiced regarding
this clause, stating the Chairman has been given excessive powers. This
replaces a provision in the existing Industry Commission Act that provides
that questions are to be decided on a majority vote with the chairman
having a deliberative vote and, if necessary, the casting vote. The
existing legislation also provides that the powers of the chairman are
only to be exercised after consultation with the other commissioners.
[26]
- The Minister is currently required to table reports of the Commission's
inquiries in parliament. The Productivity Commission Bill 1996 gives
powers enabling the Minister to order an inquiry. It is also left to
the Minister's judgement wether or not to publish the results of the
inquiry. The ACTU also noted a provision within the bill regarding the
publication of a notice of inquiry. The Productivity Commission Bill
1996 states that the Commission can provide notice of an inquiry in
any way it sees fit. [27]
- Concern was expressed regarding competitive neutrality complaints
being adjudicated by the Productivity Commission. The ACTU believed
that the Commission would be ill equipped to provide neutral decisions
between private and public agencies in relation to competitive neutrality
stating that the Commission has a bias against public agencies. [28]
RECOMMENDATION:
The Committee recommends that the Bill be passed.
A.B. Ferguson
Chairman
Footnotes
[7] Submission No. 2, Public Transport Union,
Inquiry into Productivity Commission Legislation, 21 February 1997.
[8] Submission No. 1, Australian Council of
Trades Unions, Productivity Commission Inquiry Submission, February
1997.
[9] Evidence, p. 65.
[10] A Competitive Australia, The Government's
role in generating the conditions to make Australia a better place to
do business and create jobs, Hon. John Howard MP, Leader of the
Opposition, July 1995.
[11] Evidence, p.66.
[12] Submission No. 2, Public Transport Union,
Inquiry into Productivity Commission Legislation, 21 February 1997.
[13] Submission No. 5, Council of Textile
and Fashion Industries of Australia Limited, Productivity Commission
Inquiry Submission, 21 February 1997.
[14] Submission No. 2, Public Transport Union,
Inquiry into Productivity Commission Legislation, 21 February 1997.
[15] Submission No. 3, Australian Education
Union, February 1997.
[16] Evidence, p. 66.
[17] Submission No. 6, Australian Chamber
of Manufactures, Productivity Commission Bill 1996, 21 February 1997.
[18] Submission No. 1, Australian Council
of Trades Unions, Productivity Commission Inquiry Submission, February
1997.
[19] Evidence, p. E 64.
[20] Submission No. 4, Federation of Parents
and Citizens Associations of New South Wales, 21 February 1997.
[21] Evidence, p. 74.
[22] Submission No. 6, Australian Chamber
of Manufactures, Productivity Commission Bill 1996, 21 February 1997.
[23] Submission No. 1, Australian Council
of Trades Unions, Productivity Commission Inquiry Submission, February
1997.
[24] Evidence, p 64.
[25] Productivity Commission Bill 1996, Section
43 (6).
[26] Evidence, p. E 64.
[27] Evidence, p. E 64.
[28] Evidence, p. E 65.