Commonwealth of Australia Explanatory Memoranda Commonwealth of Australia Explanatory Memoranda[Index] [Search] [Download] [Bill] [Help]
2022-2023
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
SENATE
NATIONAL RECONSTRUCTION FUND CORPORATION BILL 2023
SUPPLEMENTARY EXPLANATORY MEMORANDUM
Amendments to be moved on behalf of the Government
(Circulated by authority of the Minister for Industry and Science the Hon Ed Husic MP)
AMENDMENT TO NATIONAL RECONSTRUCTION FUND CORPORATION BILL
2023
OUTLINE
The National Reconstruction Fund Corporation Bill 2023 (the Bill) was introduced in the
House of Representatives on 30 November 2022 and passed on 9 March 2023.
On 1 December 2022, the Senate referred the provisions of the Bill to the Economics
Legislation Committee (the Committee) for inquiry and the Committee released its final
report on the Bill on 10 March 2023.
The Committee recommended that the Bill be passed.
These amendments to the Bill address issues discussed by the Committee and respond to
stakeholder feedback received during the Committee's inquiry process and debate on the Bill
in the House of Representatives.
The key amendments to the Bill include:
• requiring the Corporation Board to have regard to certain matters in the exercise of its
functions
• a requirement for the Corporation to have an environmental, labour, social and
governance policy to inform the exercise of its investment functions and powers
• a condition that the CEO can only delegate their powers to senior staff members.
FINANCIAL IMPACT STATEMENT
The proposed amendments will not change the financial impact of the Bill.
A total of $15 billion will be made available for the purposes of the Corporation with
$5 billion available from commencement. The remaining $10 billion will be made available
by 2 July 2029 in instalments as determined by the Ministers. The Corporation is expected to
generate revenue from its investments, which will be available for reinvestment.
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
National Reconstruction Fund Corporation Bill 2023
This statement sets out the compatibility of amendments to the National Reconstruction Fund
Corporation Bill 2023 and responds to concerns raised by the Parliamentary Joint Committee
on Human Rights in Report 1 of 2023 dated 8 February 2023.
Overview of amendments to the Bill
The National Reconstruction Fund Corporation Bill 2023 (the Bill) was introduced in the
House of Representatives on 30 November 2022 and passed on 9 March 2023.
On 1 December 2022, the Senate referred the provisions of the bill to the Economics
Legislation Committee for inquiry and it released its final report on the Bill on 10 March
2023.
The key amendments to the Bill include:
• requiring the Corporation Board to have regard to certain matters in the exercise of its
functions
• a requirement for the Corporation to have an environmental, labour, social and
governance policy to inform the exercise of its investment functions and powers
• a condition that the CEO can only delegate their powers to senior staff members.
Human rights implications of amendments to the Bill
The proposed amendments do not directly engage any rights under the relevant treaties.
However, the requirements for the Corporation to take matters into account under the
proposed amendments to clause 17 would have indirect benefits in respect of the right to
work, including contribution to secure jobs and a skilled and adaptable workforce.
Additional comments in response to concerns raised by the Parliamentary Joint
Committee on Human Rights
The Parliamentary Joint Committee on Human Rights has noted that the Bill permits the
Corporation to disclose official information, which may include personal information. The
Committee therefore requested additional information to assess the compatibility of this
measure with the right to privacy.
Disclosure of personal information
The official information that may be disclosed by the Corporation under clause 85 of the Bill,
including national security information, may include personal information, and may therefore
engage the right to privacy. The information that would be provided to the Corporation would
typically be provided by businesses seeking investment, and could contain some limited
personal information, such as the names and contact details of senior officers in the business
for the purpose of the Corporation making investments.
The intention of clause 85 is not to be generally permissive but to provide for the
Corporation's ability to share information, particularly national security information or
sensitive financial intelligence information in a narrow set of circumstances, to facilitate the
effective and efficient performance of the Corporation's investment functions.
Compatibility with the right to privacy
The Australian Privacy Principles (APPs) as provided for by the Privacy Act 1988 authorise
the disclosure of personal information where the disclosure is authorised by or under an
Australian law (APP 6.2(b)). Clause 85 provides such an authorisation for the provision of
information about the affairs of a person (including personal information) to limited classes
of recipients to enable appropriate sharing of information in limited circumstances where it
will facilitate the exercise of the Corporation's investment functions or enable the receiving
entity to perform or exercise any of its functions.
The intended use of subclause 85(1) would be, for example, to:
a) enable sharing of information between the Corporation and its subsidiaries
b) enable the provision of information by the Corporation to its administering
Commonwealth departments
without requiring the express consent of every individual whose information is contained in
the material or the redaction of large amounts of material. The alternative would directly
impinge on the effective and efficient performance of the Corporation's investment functions
where this performance relies on the Corporation's ability to disclose official information as
appropriate.
The Bill also authorises the sharing of information for national security or financial
intelligence purposes under subparagraph 85(3)(a)(iii), such as where information is referred
to the Australian Transaction Reports and Analysis Centre to investigate potential money-
laundering, provided that this information is shared to facilitate the performance of the
Corporation's investment functions or to enable the recipient to exercise their functions or
powers (clause 85(3)(a) refers). Sharing information for those purposes is broadly consistent
with the Privacy Act 1988, in particular APP 6.2(e), which permits the disclosure of
information where it is reasonably necessary for one or more enforcement related activities
conducted by or on behalf of an enforcement body.
Furthermore, the scope of the Corporation's financing remit includes investment in defence
capabilities as well as critical technologies in the national interest. It is important that any
concerns that may arise in the course of the Corporation exercising its investment functions
(including matters that arise during due diligence and negotiation) are able to be shared with
relevant national security or intelligence bodies. To the extent that personal information is
shared with an intelligence or national security body under subclause 85(3)(a)(iii), that
sharing would be proportionate to the essential public interest of enabling this intelligence or
national security body to perform its functions.
The proposed measure is therefore directly connected to its objective of facilitating the
effective and efficient performance of Government functions. Moreover, any risks related to
limiting the right to privacy in the manner this provision does are commensurate and
proportionate to the necessity of the provision to achieving this objective.
Entities to whom official information may be disclosed
The disclosure powers under clause 85 are also sufficiently circumscribed when considered in
the context of the limited classes of recipients that may receive official information under
subclauses 85(2) and 85(4) of the Bill. The classes of entities listed under subclauses
85(2)(a), 85(2)(b) and 85(2)(c), including any subsidiaries the Corporation establishes, would
themselves subject to the APPs and, as such, would be required to keep any personal
information received confidential. Most state and territory governments (subclause 85(d)
refers), where they are not subject to the APPs, have equivalent legislation which cover their
public sector agencies. Furthermore, any rules made by the Ministers prescribing a further
agency, body or person under subclause 85(2)(e) would be subject to disallowance.
It would be inappropriate to prescribe specific entities under subclause 85(2), rather than
broad classes of entity, since the specific entities the Corporation may be required to interact
with in order to exercise its investment functions may reasonably be expected to change over
time.
Conclusion
The Bill and the proposed amendments are compatible with human rights. To the extent that
it may limit human rights, those limitations are reasonable, necessary and proportionate.
NOTES ON AMENDMENTS
Amendment 1 --Clause 5
1. This amendment inserts a definition for Australia's greenhouse gas emissions reduction
targets. This definition is consistent with consequential amendments made to other Acts
following passage of the Climate Change Act 2022 (Cth).
Amendment 2--Clause 17
2. This amendment sets out a number of matters that the Board should have regard to in
the performance of its functions by inserting new subclause 17(3A). The list is a non-
exhaustive list of considerations rather than a list of mandatory criteria that must be
satisfied each time the Board performs its functions.
Amendment 3--Clause 17
3. This amendment expands the remit of subclause 17(5) to cover the new paragraph at
subclause 17(3A). The requirement for the Board to have regard to the listed matters in
subclause 17(3A) does not limit the matters to which the Board may have regard, or the
matters with respect to which the Board may be directed in the Investment Mandate.
Amendment 4--Clause 75
4. This amendment inserts new paragraph 75(1)(ca) to create a requirement for the Board
to formulate policies on labour, environmental, social and governance matters that must
be considered by the Corporation in relation to the Corporation's investment functions
and powers. The development of such a policy represents investment best practice and
aligns with the matters that the Board should have regard to in clause 17.
Amendment 5--Clause 75
5. This amendment inserts new paragraph 75(1)(fa) to ensure that the requirement for the
Board to formulate policies on labour, environmental, social and governance matters
extends to policies for designated subsidiaries of the Corporation.
Amendment 6 - Clause 82
6. This amendment corrects a drafting error and has no policy implications.
Amendment 7--Clause 90
7. This amendment allows the CEO of the Corporation to delegate their powers and
functions only to senior staff.
Amendment 8--Clause 90
8. If the Corporation or Board delegates a power or function to the CEO, this amendment
allows the CEO to subdelegate it only to senior staff.
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