Electricity and Other Legislation Amendment Bill 2016
Plain English Summary
Overview
This bill supports the merger of Queensland's two government-owned electricity networks, Energex and Ergon, under a single parent company by ensuring the merged businesses remain subject to the same regulations as before. It also renames the Island Industries Board to Community Enterprise Queensland, modernises its governance and removes the geographic limits on where it can run stores serving remote communities.
Who it affects
Electricity customers across Queensland see no change in supply but sit behind a newly merged network operator, while residents of remote Torres Strait and Cape York communities keep their government-run stores under a new name with stronger oversight and a clearer duty to supply essentials at a fair price.
Energex-Ergon merger
Ensures that when Energex and Ergon stop being stand-alone Government Owned Corporations and become subsidiaries of a new parent company, they remain subject to the same laws, including anti-corruption oversight, ombudsman exemptions and tax treatment.
- Allows the State's shares in Energex and Ergon to be transferred to a new parent company
- Keeps the Crime and Corruption Act 2001 and Ombudsman Act 2001 treatment of Energex and Ergon in place after the merger
- Keeps existing employment rules for government-owned electricity workers applying to the new parent company
- Protects contracts, licences and obligations from being triggered or broken just because an entity stops being a GOC
Judicial review
Cleans up an inconsistency so that decisions of State electricity entities continue to be exempt from judicial review to the same extent as before, even if they are not GOCs.
- Extends the existing judicial review exemption to State electricity entities that are not GOCs
- Removes the separate listing of State electricity entities from the Judicial Review Act schedule
Community Enterprise Queensland
Continues the Island Industries Board as Community Enterprise Queensland with modernised governance. It can now operate outside the Torres Strait and Northern Peninsula, and has clearer duties to supply food and household essentials at a fair price.
- Renames the Island Industries Board to Community Enterprise Queensland
- Removes the geographic limit so it can run stores in other communities where commercial operators are not available
- Creates a new 5-10 member board including at least one consumer representative, replacing nominations from local governments
- Sets new disqualification rules for the CEO (indictable convictions, insolvency, corporations disqualifications) and requires disclosure of conflicts of interest
- Gives the Minister power to direct the board in the public interest, with directions published in the annual report and publicly
- Creates a process for local residents or resident-controlled entities to apply to take over an operating store, with Minister and Treasurer approval
Bill Story
The journey of this bill through Parliament, including debate and recorded votes.
▸Committee15 Mar 2016View Hansard
Referred to Finance and Administration Committee
The Transportation and Utilities Committee examined the Electricity and Other Legislation Amendment Bill 2016, which covered the merger of Energex and Ergon under a parent company, and changes to the governance of the Island Industries Board (IBIS) for Torres Strait retail services. The committee recommended that Part 2 of the bill be passed and that the board composition be amended to include at least one community representative alongside the consumer representative. The government accepted both recommendations.
Key findings (4)
- The bill facilitated the merger of Energex and Ergon under a parent company to streamline operations and harness efficiencies in the energy distribution sector
- The Island Industries Board (IBIS) operates 20 retail outlets across the Torres Strait and northern peninsula area, employing 160 staff with 100% Indigenous staffing in 15 outlets
- The committee found that community representation on the new Community Enterprise Queensland board was important for local knowledge and participation
- The government accepted the committee's recommendation to add a community representative to the board
Recommendations (2)
- The committee recommends that Part 2 of the Electricity and Other Legislation Amendment Bill 2016, relating to amendment of the Aboriginal and Torres Strait Islander Communities (Justice, Land and Other Matters) Act 1984, be passed.
- The committee recommends that section 60DB of the Bill be amended to provide for 'at least one community representative' on the Board in addition to 'at least one consumer representative'.
Committee report tabled
▸Second Reading14 June 2016View Hansard
That the bill be now read a second time
Vote to pass the bill's principles and advance it to the consideration in detail stage; passed 43-39 with ALP, KAP and an independent in favour and the LNP opposed.
The motion passed.
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Ayes (43)
Noes (39)
▸26 members spoke11 support15 oppose
Opposed the bill as the LNP shadow Treasurer, arguing the Energex-Ergon merger lacked proper scrutiny and would create a monolithic government-owned business competing unfairly with mum-and-dad electrical contractors.
“The LNP members will not be supporting this bill. We cannot in good conscience do this knowing the perverse outcomes this merger will produce. We cannot do this because we believe our mum-and-dad electrical contractors should not have to compete against the government run monolith for work.”— 2016-06-15View Hansard
Minister for Energy defended the bill as necessary to facilitate operations of Energex and Ergon following their merger under a new parent company Energy Queensland, and to modernise IBIS as Community Enterprise Queensland. Accepted the committee's recommendation to add a community representative to the board.
“This bill is to help facilitate the operations of Energex and Ergon following the implementation of the electricity distribution businesses merger. It is not a bill implementing the merger itself.”— 2016-06-14View Hansard
Supported the bill as committee chair, describing it as honouring an election commitment to merge Energex and Ergon while keeping assets in public hands, and defending the committee process against opposition criticism.
“This bill has two objectives and they are quite simple: firstly, to facilitate the merger of our state owned electricity distribution companies, Energex and Ergon, which honours an important election commitment ... I proudly commend the bill to the House.”— 2016-06-15View Hansard
Opposed the bill as committee deputy chair, citing inadequate scrutiny, concerns about 366 forecast redundancies, and the risk of anticompetitive impacts on small electrical businesses.
“I rise to speak to the legislation before the House and the proposed merger. At the outset I say that we will be opposing this bill in its entirety, because we have grave concerns about the capacity and the capability of the government to handle this merger well.”— 2016-06-15View Hansard
Supported the bill as enabling a merger that would protect public ownership, prevent privatisation, and position Queensland for growth in solar and battery technology.
“I rise to speak in support of the Electricity and Other Legislation Amendment Bill. This bill is to facilitate the operations of Energex and Ergon after they are merged into Australia's largest energy company ... This new entity and any subsidiaries will benefit Queenslanders.”— 2016-06-15View Hansard
Opposed the bill citing inadequate committee scrutiny, concerns that the new energy services business would harm mum-and-dad sparkies, and that claimed savings were largely attributable to the Australian Energy Regulator rather than the merger.
“I do not support this bill. I do not support this merger and the establishment of an electrical retail services business ... Labor clearly wants to do in private enterprise for the enrichment of union members.”— 2016-06-15View Hansard
Opposed the bill, arguing on behalf of North Queensland electrical contractors and regional communities that the new energy services business would undercut local sparkies.
“We are very much opposed to the bill, because we do not believe it is in the interests of small businesses that work in the electrical game. We are concerned about the implication for them, their families and their local communities.”— 2016-06-15View Hansard
Supported the bill, defending the committee process and arguing the opposition's concerns about the energy services business were outside the scope of the bill.
“Despite the irrelevancy that we have heard from many of the speakers on the other side, I ask them to concentrate on the actual tenor of the bill. They should refer to the public hearings, because they were clear, open and transparent. They should support the bill because I think it adds to the benefit of this state.”— 2016-06-15View Hansard
Opposed the bill as shadow energy minister, criticising the rushed committee process and raising concerns that a monolithic merged entity would harm small electrical contractors.
“This is a bill to merge two major companies in Queensland ... Merging those two together means we are forming $24.5 billion worth of new company here. This is the only opportunity members of this House will have to look at this situation ... the committee process in this particular case was absolutely flawed.”— 2016-06-15View Hansard
Supported the bill, highlighting that the new merged Energy Queensland would be headquartered in Townsville creating regional jobs and honouring Labor's commitment not to sell assets.
“I rise to speak in support of the Electricity and Other Legislation Amendment Bill 2016. The Queensland public elected us on a mandate to keep our income-generating assets in state hands and to operate them effectively and efficiently, and part of that mandate was to merge the businesses and generate savings.”— 2016-06-15View Hansard
Opposed the bill as Deputy Leader of the Opposition, on behalf of electrical contractors in the Nanango electorate who would be impacted by the new government-owned energy services business.
“I rise to oppose the Electricity and Other Legislation Amendment Bill 2016. I speak on behalf of hundreds of electrical contractors who run small businesses all across this great state ... There is no demonstrated need for a government sponsored, taxpayer funded organisation. I condemn this legislation.”— 2016-06-15View Hansard
Opposed the bill, concerned about electricity quality-of-supply issues in regional Queensland and that the merger would worsen service, pricing and jobs in bush communities.
“I cannot see that my constituents will be better off. I fear they will be worse off in terms of price, service and quality of supply and repair after natural disasters such as bushfire or flood. I also believe it will see even more government jobs ripped from the bush ... I do not support this bill.”— 2016-06-15View Hansard
Supported the bill, welcoming the decision to base the merged Energy Queensland headquarters in Townsville and create jobs in North Queensland.
“I rise this evening to speak in support of the Electricity and Other Legislation Amendment Bill, and I support it 100 per cent. This is another great example of our Premier showing absolute commitment to the city of Townsville by locating the newly merged Energy Queensland in our great city.”— 2016-06-15View Hansard
Opposed the bill, arguing it would destroy mum-and-dad electrical businesses, benefit the ETU, and place hundreds of small contractors at financial risk.
“This bill is an abuse of market power. It is bad economics. It sends the wrong message to Queensland's largest employer, the small business community, threatening their viability and security. It is about an incompetent government repaying the ETU by creating a state-owned monopoly at the expense of sparkies. I urge this chamber to reject this bill.”— 2016-06-15View Hansard
Opposed the bill, citing lack of regional consultation, concerns about competition with local contractors in south-west Queensland, and risks to the 366 employees potentially facing redundancy.
“It is for the many reasons that I have outlined that the opposition will not be supporting this legislation.”— 2016-06-15View Hansard
Supported the bill as delivering on election promises to keep electricity assets in public hands while creating efficiencies through the merger.
“I rise to speak in support of the Electricity and Other Legislation Amendment Bill 2016 ... This bill plays its part in delivering on that. It goes to the explicit promise we made to the people of Queensland at the election that we would keep electricity assets in public hands, with additional efficiencies introduced to lower costs.”— 2016-06-15View Hansard
Opposed the bill on behalf of electrical tradies in the Albert electorate, concerned that a parent-company energy services business would compete unfairly with local small businesses.
“I am gravely concerned about the effect of this bill on my local small businesses and about any benefit this merger will have for power supply in Queensland.”— 2016-06-15View Hansard
Opposed the bill, arguing Labor's history shows that asset restructuring legislation is typically a precursor to asset sales, undermining government assurances about public ownership.
“All of the evidence over several years and several parliaments shows that before the Australian Labor Party wish to sell one of the publicly owned assets in this state they present a restructuring piece of legislation in this parliament and then they flog it off.”— 2016-06-15View Hansard
Supported the bill as delivering on Labor's election commitment to keep energy assets in public hands and merge Energex and Ergon to create efficiencies.
“I rise tonight to speak in support of the Electricity and Other Legislation Amendment Bill 2016. This is an election commitment which allows for the network business merger between Energex and Ergon into the largest power company in the country with over $20 billion in assets.”— 2016-06-15View Hansard
Opposed the bill due to inadequate scrutiny, lack of identified merger savings, and concerns about creating a monopoly that could compete with independent contractors.
“I rise to oppose this bill tonight. There are several reasons why I believe this bill should be opposed. One that needs to worry this parliament the most is that scrutiny of legislation coming through this place is paramount.”— 2016-06-15View Hansard
Opposed the bill, defending small electrical businesses against competition from a government monopoly, and criticising the lack of committee consultation in Townsville and regional areas.
“I rise this evening to make a contribution to the Electricity and Other Legislation Amendment Bill. In doing so, I join my colleagues on this side of the House in opposing this government's attempt to create a large government monopoly.”— 2016-06-15View Hansard
Supported the bill as Minister for Small Business, defending the new energy services business as supporting innovation and collaboration with electricians rather than competing with them.
“I rise to speak in support of the Electricity and Other Legislation Amendment Bill 2016. The Palaszczuk government has made no secret of our commitment to supporting small business and promoting innovation ... The new energy services business will not compete with solar installers or electrical contractors in established markets.”— 2016-06-15View Hansard
Opposed the bill, citing inadequate scrutiny, concerns about the new services business competing with local sparkies, and questioning whether the ETU or the ALP was running the state.
“As a member of parliament I am greatly concerned by the lack of scrutiny and oversight of a merger which will create the largest electricity distribution business in Australia ... who is really running this great state—the ALP or the ETU?”— 2016-06-15View Hansard
Opposed the bill as a former energy minister, citing Labor's historical mismanagement of energy assets, ongoing legacy costs of solar feed-in tariffs, and the limits of renewable energy and battery technology.
“At the end of the day this government has a history of not understanding the power sector, of treating the people of this state with disdain and, more importantly, of using these entities as cash cows for its own benefit. We cannot support this bill in its current form.”— 2016-06-15View Hansard
Supported the bill on behalf of Katter's Australian Party, arguing it was better to merge government-owned corporations than to sell them, and welcoming headquartering in Townsville.
“I rise to speak to the Electricity and Other Legislation Amendment Bill. This bill facilitates the merger of Ergon and Energex. I truly believe that it is better to facilitate the merger of two government owned corporations than to sell them full stop ... I support this bill. I commend the bill to the House.”— 2016-06-15View Hansard
Summed up in reply as Minister for Energy, defending the bill as delivering on election commitments, creating efficiencies, and preparing Queensland for rapidly changing energy technology.
“With this renewable energy era on our doorstep, what we had was an ignorant team effort from the opposition. We are preparing for the future. This is a sensible bill. It is fulfilling our election commitment. It deserves the support of this House.”— 2016-06-15View Hansard
▸In Detail15 June 2016View Hansard
Amendments to clause 7 requiring at least one member of the Community Enterprise Queensland board to be a community representative, and inserting a definition of 'community representative' as a person whom the Minister considers represents the interests of the communities in which Community Enterprise Queensland performs its functions.
Vote on a motion
Procedural motion during the debate that was defeated on party lines (41 ayes, 42 noes).
The motion was rejected.
A formal vote on whether to accept a proposal — this could be the bill itself, an amendment, or another motion.
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Ayes (41)
Noes (42)
Referenced Entities
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Sectors Affected
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