On 10 December 2020, the Senate referred the provisions of the National Collecting Institutions Legislation Amendment Bill 2020 (bill) to the Environment and Communications Legislation Committee (committee) for inquiry and report by 29 January 2021. The reporting date was subsequently extended to 12 February 2021.
According to the Explanatory Memorandum to the bill (EM), the bill would amend the enabling legislation of six National Collecting Institutions (NCIs) to provide them with broader investment powers than are currently permitted by the Public Governance, Performance and Accountability Act 2013 (PGPA Act), improve efficiencies and address longstanding administrative inconsistencies between the six Acts.
Conduct of the inquiry
In accordance with its usual practice, the committee advertised the inquiry on its website and wrote to relevant organisations inviting submissions by 15 January 2021.
The committee received two submissions, which are listed at Appendix 1 and are available on the committee's website at www.aph.gov.au/senate_ec.
The committee also held a public hearing on 28 January 2021 in Canberra. A list of witnesses who gave evidence at the hearing is at Appendix 2.
The committee thanks all of the individuals and organisations who contributed to the inquiry.
Scope and structure of the report
This report comprises two chapters:
Chapter 1 provides background information relating to the bill, outlines its key proposals and notes reviews of the bill undertaken by other committees.
Chapter 2 examines the primary issues raised by stakeholders in submissions and in evidence, and sets out the committee's findings and recommendation.
Note on references
In this report, references to the Committee Hansard are to the proof (that is, uncorrected) transcript. Page numbers may vary between the proof and the official transcript.
The PGPA Act governs how a 'corporate Commonwealth entity'—such as the six NCIs impacted by the bill—uses and manages public resources.
In particular, the PGPA Act allows for corporate Commonwealth entities to invest funds if the money is not immediately required for the purposes of the entity and provided the money is invested in certain ways.
The then Minister for Communications, Cyber Safety and the Arts (Minister) noted that these investments are limited to 'low-interest bearing options such as bank accounts or securities guaranteed by the Commonwealth'.
Further, the EM notes that the PGPA Act does not distinguish between government funds or funds sourced from third parties:
This means the investment of donated revenue to the NCIs, directly or through their established foundations, is currently restricted to low risk (and hence low return) options. These restrictions act as a disincentive to donors, as institutions are unable to generate competitive rates of return on donated funds, reducing potential value for money.
Key proposals in the bill
The bill would amend the following Acts:
Australian National Maritime Museum Act 1990
National Film and Sound Archive of Australia Act 2008
National Gallery Act 1975
National Library Act 1960
National Museum of Australia Act 1980
National Portrait Gallery of Australia Act 2012
Schedule 1 of the bill would provide these NCIs with powers to develop an investment policy for 'donated revenue' and to invest that revenue for the long-term benefit and improved financial sustainability of the institutions.
Schedule 2 of the bill would make administrative amendments to address certain inconsistencies among the six enabling Acts and with the PGPA Act, to improve efficiency and productivity.
Reports of other committees
When examining a bill, the committee takes into account any relevant comments published by the Senate Standing Committee for the Scrutiny of Bills (Scrutiny Committee) and the Parliamentary Joint Committee on Human Rights (Human Rights Committee).
The Scrutiny Committee assesses legislative proposals against a set of accountability standards that focus on the effect of proposed legislation on individual rights, liberties and obligations, the rule of law and on parliamentary scrutiny. The Scrutiny Committee examined but had no comment in relation to the bill.
The Human Rights Committee examines bills and legislative instruments for compatibility with human rights, and reports its findings to both Houses of Parliament. The Human Rights Committee examined but had no comment in relation to the bill on the basis that it does not engage, or only marginally engages, human rights; promotes human rights; and/or permissibly limits human rights.