Commonwealth of Australia Explanatory Memoranda

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COMMUNICATIONS LEGISLATION AMENDMENT (EXECUTIVE REMUNERATION) BILL 2017

                                2016-2017




    THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA




                                SENATE




Communication Legislation Amendment (Executive Remuneration) Bill 2017




                  EXPLANATORY MEMORANDUM




                (Circulated by authority of Senator Hanson)
COMMUNICATION LEGISLATION AMENDMENT (EXECUTIVE
REMUNERATON) BILL 2017

OUTLINE

The Australian Postal Corporation (Australia Post) and the National Broadband Network
Company (NBN Co) are both Government Business Enterprises (GBEs) pursuant to the
Public Governance, Performance and Accountability Act 2013 (PGPA).

Australia Post is a GBE pursuant to section 5(1) of the PGPA rule and NBN Co is a GBE
pursuant to section 5(2) of the PGPA rule.

The purpose of this legislation is to make the Remuneration Tribunal the responsible body for
setting the remuneration for the Managing Director of Australia Post and the Chief Executive
Office of NBN Co.

The steps to achieve this are to remove the responsibility of both the Board of Australia Post
and the Board of the NBN Co to set remuneration and to give the responsibility to the
Remuneration Tribunal.

Australia Post and the NBN Co are commercially focussed, however they differ from listed
companies in that their capital are provided by Government; however there still remains a
requirement for transparency and accountability in respect of remuneration.

Both the Boards of Australia Post and the NBN Co have failed to meet community
expectations, albeit to different degrees, in respect of transparency relating to remuneration
and the quantum of remuneration.

NOTES ON CLAUSES

Clause 1: Short Title

1.   This clause provides that the short title of the Act may be cited as the
Communications Legislation Amendment (Executive Remuneration) Act 2017.

Clause 2: Commencement

2.      This clause provides for the commencement of the entire Act to be the day after the
Bill receives the Royal Assent.

Clause 3 - Schedules

4.     Each Act specified in a Schedule to this Act is amended or repealed as is set out in the
applicable items in the Schedule. Any other item in a schedule to this Act has effect
according to its terms.
Schedule 1 - Australia Post

Australian Postal Corporation Act 1989

5.      This Schedule amends the Australian Postal Corporation Act 1989 by removing the
Board's authority to set remuneration for the Managing Director. The authority is given to the
Remuneration Tribunal by providing the office of Managing Director at Australia Post be a
senior office to which the Remuneration Tribunal Act 1973 applies.

Item 1 - After section 85

6.     This item adds a new section 85A to the Australian Postal Corporation Act 1989.
        Sections 85A(1),(2) and (3) require the Remuneration Tribunal set the
          remuneration of the Managing Director at Australia Post; and
        Section 85A(4) and (5) deem the office of Managing Director to be a "public
          office" for the purpose of the Remuneration Tribunal Act 1973 and prevent the
          Minister administering that Act from reversing this position.

Item 2 - Section 86

7.    This item is intended to remove the authority of the Board of Australia Post to set the
remuneration of the Managing Director.

Remuneration Tribunal Act 1973

Item 3 - Subsection 3(1) (paragraph (a) of the definition of principal executive office)

8.     This item repeals the existing paragraph that provided for the Managing Director of
Australia Post to be treated as a "principal executive office" rather than a "public office".

Remuneration Tribunal (Miscellaneous Provisions) Regulations 1976

Item 4 - Schedule 1 (table item 1A)

9.      This item repeals the item that provided for the Managing Director of Australia Post
to be treated as a "principal executive office" rather than a "public office".

Item 5 - Application

10.     This item provides for the amendments to apply after the end or variation of the
current contract (if any).
Schedule 2 - NBN Co

National Broadband Network Companies Act 2011

Item 1 - After section 96

11.      This item inserts section 96A of the Act to provide for the Remuneration Tribunal to
set the remuneration for the Chief Executive Officer of NBN Co by specifying that office as
being one to which Part II of the Remuneration Tribunal Act 1973 applies.

12.    This item provides for the transition between the current contractual arrangements
with the Chief Executive Officer of NBN Co and the new arrangements.
                 Statement of Compatibility with Human Rights


Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011


     Communications Legislation Amendment (Executive Remuneration) Bill 2017


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
The purpose of the Bill is to provide transparency and accountability in respect of
remuneration paid to the heads of Australia Post and the NBN Co. The Bill once enacted will
provide consistency for the setting of remuneration across all Government Business
Enterprises.

Human rights implication
This Bill does not engage any of the applicable rights or freedoms.

Conclusion
This Bill is compatible with human rights.


                                       Senator Hanson

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