Commonwealth of Australia Explanatory Memoranda

[Index] [Search] [Download] [Bill] [Help]


PUBLIC GOVERNANCE, PERFORMANCE AND ACCOUNTABILITY AMENDMENT (PROCURING AUSTRALIAN GOODS AND SERVICES) BILL 2016

                               2013-2014-2015-2016




             THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA




                           HOUSE OF REPRESENTATIVES




Public Governance, Performance and Accountability Amendment (Procuring Australian
                           Goods and Services) Bill 2016



                          EXPLANATORY MEMORANDUM




                  Circulated by the authority of Hon Bob Katter MP




                                         1


Public Governance, Performance and Accountability Amendment (Procuring Australian Goods and Services) Bill 2016 OUTLINE This Bill aims to ensure that contracts on behalf of the Commonwealth, corporate Commonwealth entities and wholly owned Commonwealth companies are fulfilled with Australian goods and services. The implementation of this legislation will:- 1. Create jobs for Australians and remove people from welfare; 2. Ensure that money spent on Australian Government contracts stays in Australia; 3. Create tax revenue from that spending; 4. Ensure Australia's continued technological, industrial and defence capacities. Successive Governments have witnessed the closure of virtually every manufacturing industry in the country. At least 100,000 jobs have been lost in the motor vehicle and flow on industries. The last Australian whitegoods manufacturer closed in Orange last year. Yet a single act by Government could have saved both of these industries - to decree that all Government contracts be fulfilled with Australian goods and services. When construction of the Brooklyn Bridge was being discussed in America, there were two options - have it built by the English or Americans. And they knew that, if the English built it they would only end up with a bridge; if the Americans built it they would end up with the bridge and the money. To take the submarines contracts as an example, if the submarines are built in Australia then 4,000 jobs are created. A further $2.5 billion is created in revenue and taxation. Yet if the submarines are built overseas, we see none of the jobs nor monetary return. This Bill will ensure that Australia has the industrial know-how and capacity to build. It will ensure continuation of industries that are vital to our strategic defence capabilities. Wars come on so suddenly, we need to ensure that in a conflict situation we are capable of meeting our industrial and defence requirements. 2


FINANCIAL IMPACT The Bill will have no financial impact, aside from the costs of procurement needing to be met out of ordinary budget supplies. STATEMENT ON COMPATIBILITY WITH HUMAN RIGHTS The Statement of Compatibility with Human Rights appears at the end of this Explanatory Memorandum. 3


NOTES ON CLAUSES Part 1 - Preliminary Clause 1 - Short title This clause provides for the Act, when enacted, to be cited as the Public Governance, Performance and Accountability Amendment (Procuring Australian Goods and Services) Act 2016. Clause 2 - Commencement This clause provides for the Act to commence on the day after it receives Royal Assent. Clause 3 - Schedule(s) This clause provides for the amendment of the Public Governance, Performance and Accountability Amendment (Procuring Australian Goods and Services) Act 2016 in accordance with the items set out in the Schedule. Schedule 1 - Amendments Public Governance, Performance and Accountability Act 2013 Item 1 This item inserts a new subsection to section 6, which summaries the new Chapter 3A, Part 3A-1, outlined below. Item 2 This item adds a new Chapter 3A, Part 3A-1. Chapter 3A - Procuring Australian goods and services Part 3A-1 - Procuring Australian goods and services The new Chapter 3A, Part 3A-1, provides for the procurement of Australian goods and services. It has provisions requiring the Commonwealth, corporate Commonwealth entities and wholly-owned Commonwealth companies to procure Australian goods and services. Division 1 - Guide to this Part Section 99A sets out a guide to the Part. Division 2 - Procuring Australian Goods and Services Section 99AA provides a limitation on entering into arrangements to procure goods or services. It provides that a person (the procurer) must not enter into an arrangement with 4


another person to procure goods or services if the procurer is entering into the arrangement on behalf of the Commonwealth, a corporate Commonwealth entity or a wholly owned Commonwealth company and the goods and services are not Australian and the arrangement of the goods or services is not covered by an exception under s99AB (Public interest exceptions by Finance Minister) or 99AC (Australian Goods or services not able to be procured). Goods are considered to be Australian if:  75 per cent of the cost of the goods is attributable to labour provided by individuals who are residents of Australia; or  75 per cent of the cost of the goods is attributable to the use of components, ingredients, produce or other goods that have been manufactured or produced wholly in Australia; or  The goods are manufactured or produced wholly by residents of Australia. Services are considered to be Australian if they are provided by residents of Australia. The term resident of Australia is considered to have the same meaning as in the Income Tax Assessment Act 1936. Section 99AB provides for a public interest exemption by the Finance Minister. It outlines that the limitation on entering into arrangements to procure Australian goods or services does not apply where the Finance Minister grants an exception on the basis that it is in the public interest to do so. Subsection 99AB(3) provides that an exemption made in relation to a particular arrangement, or particular goods or services, is not a legislative instrument. This provision is included to clarify that a determination by the Minister in relation to a particular arrangement or particular goods or services is not a legislative instrument within the meaning of section 5 of the Legislative Instruments Act 2003. Conversely, subsection 99AB(4) provides that an exemption made in relation to a class of arrangements, goods or services is a legislative instrument. Section 99AC provides for an exemption where Australian goods or services are not able to be procured. It outlines that the limitation on entering into arrangements to procure Australian goods or services does not apply where the procurer has taken all reasonable steps to procure Australian goods or Australian services, and the goods or services cannot reasonably be procured. Item 3 Inserts a new subsection 105B(3), which provides that an instrument under subsection (1) applies subject to Chapter 3A (Procuring Australian goods and services). 5


Statement of Compatibility with Human Rights Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 Public Governance, Performance and Accountability Amendment (Procuring Australian Goods and Services) Bill 2016 This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011. Overview of the Bill This Bill aims to ensure that contracts on behalf of the Commonwealth, corporate Commonwealth entities and wholly owned Commonwealth companies are met with Australian goods and services. Human rights implications This Bill does not engage any of the applicable rights or freedoms. Conclusion This Bill is compatible with human rights as it does not raise any human rights issues. Hon Bob Katter MP 6


 


[Index] [Search] [Download] [Bill] [Help]