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Estimates & Committees
Scott Ludlam 1 Jun 2009

CHAIR-Senator Ludlam.

Senator LUDLAM-I would like to go to some fairly similar matters relating to the $60 million one-off
stimulus package funding, but also how that relates to the core Commonwealth funding for heritage. Can you tell me if I am reading the portfolio budget standard right? It appears to show the departmental programs support item decreases from $20.332 million this year to $14.7 million in the 2009-10 financial year. It is noted as a decrease of negative 27 per cent. First of all, does that accurately portray a decline in core administration funding for heritage, or has some funding moved sideways to somewhere else?

Mr Shevlin-I am happy to assure you that the core departmental funding as it arrives with the heritage division is actually basically exactly the same as last year, so it is about $13.7 million in both years. The difference reflects two things. One is revenue that we receive from other sources. Last year the $20 million included money from Caring for our Country for some projects-World Heritage assessments, for example. That can only be captured afterwards because those decisions are for the next financial year-


Senator LUDLAM-Would you just repeat that last part.

Mr Shevlin-The figure of $20.33 million includes about $1.8 million from other revenue sources.

Senator LUDLAM-Which do not exist this year?

Mr Shevlin-No; it is just that this captures what was paid from those other sources, but we will not know how much funding we will receive from, for example, Caring for our Country until those decisions are made. We can almost capture that retrospectively rather than in advance. But the rest of the difference just relates to the notional allocation of corporate overhead costs to different outcomes.

Senator LUDLAM-Notionally you have lost a quarter of your budget, or am I reading it wrong?

Mr Shevlin-If I can reassure you, the money that actually comes to the division for our functions is
remaining almost the same, at about $13.7 million.

Senator LUDLAM-Is that separated out anywhere? All I have to work from here is the departmental
program support line item, which is $20.3 million. That is obviously broken down. Did you say your core funding is about $13 million?

Mr Shevlin-It is $13.7 million.

Senator LUDLAM-So $1.8 million is difficult to estimate because that is revenue sources that you cannot account for yet. What about the other $4 million or thereabouts?

Mr Shevlin-Basically the departmental overhead that was assigned to the heritage division last year was
about $4.8 million. This year it is about $1 million.

Senator LUDLAM-Can you just define that term for us? What does that mean?

Mr Shevlin-The funding for the corporate divisions of the department, the corporate strategy division and the policy coordination division, do not have an individual outcome of their own. There is nothing that says just administer the department. They are actually funded from an overhead which is basically taken from all of the rest of the outcomes. There is an amount that is required for that and it is basically spread across the range of outcomes. It is a notional allocation rather than an actual amount that, if you like, is given to us and then
taken away.

Mr Tucker-It is the contribution to divisions to rent computers, electricity and the things that go into
operating a building and that all people contribute to. It is reflected in the outcomes, but then there is a certain proportion taken off to go to pay those collective costs that the department has that every division contributes to.

Senator LUDLAM-With your forbearance, I am still not clear as to why there would be such a big
variation year on year. It is a big change.

Mr Shevlin-To be honest, I had the same question when I first saw it. The answer is that we were in
outcome 1.4 last year and we are now in outcome 5. As I said, it is a notional allocation. Essentially it is just allocated across the department to different areas. It does not reflect any real change at all to the division's activities.

Ms Kruk-I looked at the numbers too and found them somewhat confusing. In my opening statement I made it clear that our budget was being represented differently in relation to outcome areas. Can I affirm Mr Shevlin's comment that his area is not experiencing a cut; it is the way it is actually depicted. That is the advice I have received. I found it confusing, so I understand your question.

Senator LUDLAM-I wonder whether it is possible, obviously on notice-I would not ask you to do this
on the back of an envelope now-to provide us with figures that we could compare with previous years'
funding. The last time we spoke I think I pointed out that funding has been declining in the medium term for heritage protection at the Commonwealth level for quite a period of time. This makes it difficult to establish whether that trend is reversed or whether it has stayed in the same place.

Ms Kruk-If we can take that on board we will try to give you some meaningful figures, but I reaffirm, as Mr Shevlin has indicated, we have been fortunate enough to have a significant injection of capital, so we have done well. But I take your question on board and we will give you that information.

Senator LUDLAM-If it is difficult for the departmental heads to decode the funding and the line items
then it makes it tricky for us as well. I would also suggest that the additional funding you received is a one-off; it is not recurrent funding-if that $60 million is what you were referring to.

Ms Kruk-Mr Tucker might explain that.

Mr Tucker-Yes, there is that one-off $60 million injection for heritage infrastructure, but for the years
beyond that there is an additional component. I think it is $5 million a year for ongoing heritage activities beyond the $60 million period. That was a new announcement in this budget.

Senator LUDLAM-Without wanting to pre-empt the outcome, when you re-present the figures to us in a format that is comparable with previous years and outcomes, will that show that the decline in heritage spending over recent years has been reversed, or do you think we are holding steady?

Mr Shevlin-It will certainly show that there has been no decline from this current financial year.

Senator LUDLAM-Staying on the $60 million for a moment, I think it is represented in the budget as a fraction less than $60 million, about three per cent, or $1.74 million, short. Would you explain what happened to that fraction.

Mr Shevlin-Nothing happened to it. It is just that with every program that is provided to the department to administer some costs usually go to the department to actually administer the grant, so it is the administrative costs.

Senator LUDLAM-This might be more sensible to put to the minister. The stimulus package funding was meant to stimulate the economy rather than being absorbed into the Public Service, with respect. Would that 2.9 per cent administrative cost for heritage funding been subtracted from other parts of the stimulus package?

Senator Carr-I would have to take that on notice.

Senator LUDLAM-It is a very cross-portfolio question, but could you tell us whether three per cent of
the whole stimulus package ended up being absorbed into administration costs or whether that is peculiar to this portfolio?

Senator Carr-I will have to take that on notice.

Senator LUDLAM-I would appreciate that. Staying with this portfolio, what will that $1.74 million
actually be spent on?

Mr Shevlin-Largely staff.

Senator LUDLAM-Can you tell us roughly how many people?

Mr Shevlin-I do not have the precise numbers, but it is about eight people in the next financial year.

Senator LUDLAM-Are they existing staff whose contracts have been extended or are these new FTEs?

Mr Shevlin-It will be a combination of both.

Senator LUDLAM-I suppose you would not be able to say over what period of time, because again this is a one-off payment. Once the $60 million is gone, what will happen to those jobs?

Mr Shevlin-As Mr Tucker mentioned, we have additional funding in the three following years, so I would expect that a number of those positions will be funded from some of that additional money.

Senator LUDLAM-That might answer the next question: have some staff been shifted away from a
recurrent funding basis to one-off program funding?

Mr Shevlin-Some of the people who will be working on this were previously working on the National
Heritage Investment Initiative, which was lapsing funding, so we have actually been quite fortunate that people we had working on one program which was lapsing are now going to be moved into work on another program which is starting up and will be able to continue into the future.

Senator LUDLAM-I guess in the scheme of things this is a relatively modest sized grant program. Is it any reflection on the shortfall in core funding of the division that you were not able to absorb this extra relatively modest sized grant program without extra administrative funding?

Mr Shevlin-This is in effect a completely new activity. In fact, it is a bit less than three per cent, I think, but those costs, as a percentage, are actually considered to be relatively low for administering a program of this sort.

Senator LUDLAM-Would you take us through the decision path from a good idea of a project that was
ready for work and met the criteria for being available to employ people straightaway. What is the decision path from somebody having a good idea to money being spent and what the decision points are for this funding?

Mr Shevlin-There is a standard process set out for the Jobs Fund projects which will apply to all but the first $6 million worth of expenditure. Public applications have been called which were due in on 22 May, so some of those have been received. Those will then be assessed by departments and, in the case of heritage projects, will include assessments by the Australian Heritage Council and recommendations will be made in relation to heritage projects to the minister for his decision.

Senator LUDLAM-Apologies if this is going over old ground, but for the first $6 million there was a
need to just get some projects on the ground straightaway so that kind of bypasses that process you have just described?

Mr Shevlin-Obviously we could not wait until 22 May to get the projects in, so we went out to some
national heritage listed properties where we knew, because we were in constant contact with those managers, they had activities that they had been wanting to do for some time but had not had the funds for. We went to the National Trust, through the Australian Council of National Trusts, and asked them to identify projects that they were aware of that were ready to go and would deliver good, positive outcomes. We went out to all state and territory heritage offices and asked them to also come forward with projects that they had that they considered high priority and that were ready to go. We also went through the Federation of Australian Historical Societies. We went out through all of the people who actually work in this sort of area and said, ‘What are your highest priority projects that you know are ready to commence quickly?', to deliver the bviously desired stimulus impact. They provided their project concepts to us. We short-listed those in consultation with the Australian Heritage Council, sought full applications from those on the short list-

Senator LUDLAM-I will just pause you there. The short-listing process is undertaken between the AHC
and your division?

Mr Shevlin-Yes.

Senator LUDLAM-Who has actually got carriage as the final decision maker? Are you subordinate to the AHC or vice versa?

Mr Shevlin-Ultimately the department provides recommendations to the minister. The Australian
Heritage Council has been writing to the minister with their advice, so we attach that to our recommendations.

Senator LUDLAM-In the case of National Trust funding, the decision chain looks something like they
would provide a short list to the AHC, which provides a short list to the department, which then provides another short list to the minister, who then makes a call on funding?

Mr Shevlin-No, not quite. The AHC decides what their highest priority projects are-

Senator LUDLAM-Sorry?

Mr Shevlin-The National Trust identify their highest priority projects.

Senator LUDLAM-They are one avenue, or one stream of-

Mr Shevlin-They are one stream, yes. The heritage division and the Heritage Council look at those
projects and then provide advice to the minister. There is not a three-step short-listing process, if you like. We look at the projects at the same time as the Heritage Council does.

Senator LUDLAM-Forgive me if this is floating around on a website somewhere, but is the short list that you provided to the minister, at least for the first $6 million, a public document? That is the short list for the first $6 million and also for future rounds. Are recommendations from your division and from the AHC public documents?

Mr Shevlin-No.

Senator LUDLAM-After all this expert advice from a lot of experts around the country, how do we know that the minister cannot just pluck something out of mid-air and completely disregard the advice that has been provided? That is not to assume bad motivations on the part of the government, but it would be helpful to know what the expert opinion was so that we could put that side by side with the decision making, as has happened for example with Infrastructure Australia: providing a short list in the public domain and then the minister makes a call on funding. Is there a reason why we are not following a similar sort of process here?

Ms Kruk-Is your question: is there such a list, or are you suggesting that there be such a list?

Senator LUDLAM-I think we established that there is a list. I am just wondering why it would not be in
the public domain, or if there is an intention to make it so.

Mr Shevlin-It is likely that we will get hundreds and hundreds of applications, some of which, to be
honest, we will dismiss pretty quickly because they just did not meet the criteria. For example, when we were looking at the first lot of project concepts that came in, a lot of them just did not get through the gate because they were not ready to start until well into the next financial year. These are assessed by and recommended by all of the key heritage bodies in Australia and then that advice is provided to the minister and the minister makes recommendations, which is pretty consistent with other processes that happen for grant schemes.

Senator LUDLAM-I have just put to you a process that is handling vastly larger sums of money and a
larger range of proponents that put their short list and their methodology-it has been criticised but at least it is in the public domain-on the table and the public can now compare how the funds that were eventually spent with the decisions that were made by government reflected the views of the experts whose opinions had been invited. I am asking why we are not following that kind of process in this case. I am sure it is not to avoid hurting the feelings of the people who were knocked back. They can come back and have another go.

Mr Shevlin-We are following the process that we have agreed with the minister.

Ms Kruk-If I could take that on board, I think you are making a suggestion to the minister. That is clearly a matter for the government and I will take that advice back to the minister. Can I stress the point that Mr Shevlin has made that this is a very highly consultative process with the aim of getting the right projects but also projects which are ready to start very quickly, so there will clearly be challenges on that basis. I think you would agree that Mr Shevlin has outlined a very robust consultation process, despite the urgency of some of the time frames. But I will take heed of your comments in terms of asking why the list of those projects is not made public. I do not think we can take it any further here.

Senator LUDLAM-That is fine. The logic appears to be sound. Nothing I have heard this afternoon
suggests that anybody has got anything to hide but we do not know whether, when the minister is cutting the ribbon, that has been completely side-stepping the process which sounds quite robust and has invited the right people's opinions. We have no idea whether any of that work is incorporated in the final spend, and I think that is a fairly fundamental-

Ms Kruk-I have heard your question. We will take that on notice.

Senator LUDLAM-The Australian Heritage Council in a submission in April 2009 to the EPBC Act
review stated: The Council notes that a number of Commonwealth agencies are not meeting their heritage requirements under the EPBC Act or not fully taking opportunities for a whole-of-government approach to heritage. At the time a recommendation was made to the agency: Recommendation 12: Greater scrutiny of Commonwealth agencies should be undertaken to ensure that they act in
accordance with their heritage responsibilities. I am wondering whether the council has formally raised those concerns with the minister or whether there has been any kind of formal reporting of those concerns.

Mr Shevlin-That was part of the council's own submission to the EPBC Act review process, so the
minister will be made aware of all of the submissions that come in from the whole range of sources.

Senator LUDLAM-Is there nothing further on that? Is that a view that is shared by the division or is that something that you are concerned about?

Mr Shevlin-We continue to work with Commonwealth agencies to remind them of their obligations under the EPBC Act in relation to heritage, but ultimately those are obligations like any other piece of law which applies to individual agencies and they have to determine whether those requirements are applicable to them or not and, if so, to then comply with those requirements. We provide them with guidance on that matter but, in effect, we are not the policemen on it. We continue to work. We know we have got a number of agencies who are meeting their obligations and a number of others we are working with to assist them in meeting their obligations, and we continue to communicate with others to encourage them to do so.

Senator LUDLAM-You are pretty well aware of what the AHC is on about there. It is quite a strongly
worded statement from the premier heritage advisory body in the country. Was specific action taken after that submission was made, or are these activities that were already afoot by your division?

Mr Shevlin-It is an ongoing process of working with agencies to make sure they are aware of their
obligations and are complying with them.

Senator LUDLAM-What do you do when the AHC says they are not complying? What happens then?
You said you are not the policeman. Who is?

Mr Shevlin-It is like many pieces of legislation which impose obligations on people. It is the
responsibility of citizens or agencies to comply with legislation.

Senator LUDLAM-What happens when they do not? AHC said here, pretty much in black and white, that they are not meeting their obligations, so what happens then?

Mr Shevlin-We continue to encourage them to do so.

Senator LUDLAM-What if they continue to not do so?

Mr Tucker-The legislation gives us no enforcement capacity.

Senator LUDLAM-Can you refer enforcement action through your minister?

Mr Tucker-No. Under this particular part of the legislation there is no enforcement capacity.

Senator LUDLAM-Maybe you are not entitled to give an opinion on this, but is that an area of law
reform that has been raised?

Mr Tucker-I suspect, in some sense, that is exactly the point of their submission and why they made that comment.

Senator LUDLAM-I do not know whether they have raised that directly, but that would certainly be
worth checking. It says ‘greater scrutiny' of agencies, but that is not exactly the same as enforcement action. I put a couple of questions on notice at the session in February. Answers were subsequently provided, but they were somewhat deficient in some cases, so I will just step through a couple of them if I could. Question on notice No. 115 says: At page 12 there is mention of a review of National Heritage management plans. When will this review be completed and will it be made public? There was not any information provided about when that review would be made public, so I am just wondering if you can help us out there?

Mr Shevlin-That was an internal review that provided advice to the Heritage Council. The Heritage
Council has discussed that and is progressing some further work in that area.

Senator LUDLAM-So the review is complete. Can you tell us when it was completed?

Mr Shevlin-The findings were discussed at the March meeting of the Heritage Council.

Senator LUDLAM-Is it likely that report or the review will be made public, or is it the intention to keep
that as a confidential document and, if so, why would that be the case?

Mr Shevlin-It was an initial internal review contacting about 10 places that have management plans in place. It was a telephone survey asking if they had the management plans-we obviously chose people who already had the management arrangements in place-and were they actually useful or were the requirements that the act was imposing on people causing them to create very lengthy documents which did not make much difference in reality in managing their property. That information that we got from talking to people has now been fed into the council and the council is getting some more work done now. We are engaging, on their behalf, a consultant to look at what would be best practice in terms of management arrangements that actually deliver real, on-ground management outcomes.

Senator LUDLAM-It sounds like a supremely worthwhile endeavour. I am still puzzled as to why the
review would not be made public.

Ms Kruk-Mr Tucker may add to that.

Mr Tucker-We will take some advice on its release. Part of it might be the way in which we ask questions of people. We might have given them a commitment that it was going to be an internal working document and it would be kept confidential, in a sense to encourage them to be as open as possible. We will take some advice on that and see what we can do.

Senator LUDLAM-If those commitments were made, that would be helpful. Question on notice 120
states: Which area of DEWHA actually makes these compliance judgements? The question was not answered. We were just looking for a unit or a division that you can pinpoint for us where that is occurring.

Mr Shevlin-I have the question here in front of me. I am not sure which bit you think we have not

Senator LUDLAM-Is it question on notice 120 that you are looking at?

Mr Shevlin-Yes.

Senator LUDLAM-Question 2.

Mr Shevlin-Yes.

Senator LUDLAM-Do you want to read back what your copy reads?

Mr Shevlin-You have asked which area of DEWHA makes compliance judgements and we say:
... compliance matters are ... reported to the Compliance and Enforcement Branch of the Approvals and Wildlife Division of the Department, which liaises with the Heritage Division on ... potential-
things. They seek our expert advice, but the compliance issues are managed by the Approvals and Wildlife Division.

Senator LUDLAM-That rests there. That is where that decision is actually made. No. 4 from the same
question states: Are the expert views of the Heritage Division on significant impacts always adopted? If not, why not? The first part of the question there has not really been answered.

Mr Shevlin-When the minister and the department make decisions on that, there is a whole range of bits of input to them. Some of it is expert heritage advice, but there will be other matters, as well, that will be considered. Inevitably, there could be times where we might have advice on one issue but on which there is another factor, which will mean that our advice is not adopted in total. So it is possible.

Senator LUDLAM-Sometimes that does happen. Lastly, can you provide us with an update on question on notice 123, regarding transfer of Point Nepean to Victoria, please?

Mr Shevlin-The government remains committed to effecting the transfer as soon as possible. We are
working very closely with the Victorian government to try to finalise that matter.

Senator LUDLAM-Can you provide us with a timetable for when that might occur or where you are in
the process?

Mr Shevlin-I cannot be precise, but we are working to finalise it as soon as possible.

Senator LUDLAM-I hear a fair bit of that at estimates hearings and I never know whether it means days, weeks, months or years. Can you give me an order of magnitude-I will not hold you to it.

Mr Tucker-It is not up to us to announce what a government may do in the near future. We are obviously working very closely with our colleagues, but it will be up to the government when it makes its announcement.

Senator LUDLAM-You will understand that, from the outside, these processes are entirely opaque.

Mr Tucker-There is nothing preventing you from asking the minister in this regard.

Senator Carr-The officers have made it clear that it will be as soon as possible.

Senator LUDLAM-That is why I do not generally ask the minister. I will come back to where I was right
at the beginning. In answer to a question that Senator Wortley raised, you mentioned that, out of the $60 million, $12 million has been set aside for properties managed by the National Trust. Can you tell us how that figure was arrived at, quarantining just under a quarter of that funding for the trust? What was the thinking behind that formula?

Mr Shevlin-That was the split that was decided by the minister.

Senator LUDLAM-So that did not come from the heritage side but from the minister's office. It was not on your advice, the advice of the Heritage Council or anything like that?

Mr Shevlin-I cannot comment on any advice that we might or might not have provided to the minister.

Senator LUDLAM-Why is that?

Mr Shevlin-Because it is internal between us and the minister.

Senator LUDLAM-You cannot tell us whether advice was even provided? I am not asking for the nature of the advice.

Senator Carr-There are conventions on this.

Senator LUDLAM-I realise that. I think it is a fair question to ask: was the minister's decision informed by your staff and your division or not? I am not asking for the advice itself.

Ms Kruk-The minister would have received advice from a number of quarters on that. I think the minister would have also been very conscious of the needs of that particular group of heritage properties. I echo Mr Shevlin's comments about not wanting to provide the nature of the advice to you. That is obviously internal to us.

Senator LUDLAM-I was not after the nature.

Ms Kruk-Thank you for that.

Senator LUDLAM-I just wanted to know whether advice was provided. I am not sure why I suddenly
feel like I am stepping on toes.

Ms Kruk-You are not stepping on toes. I am just saying that the minister would have sought advice from a number of quarters.

Senator LUDLAM-Including your office?

Ms Kruk-You are asking me a difficult question. In terms of who he would have sought advice from, no doubt it would have been from various areas.

Senator LUDLAM-I am not trying to trespass on other divisions or departments that you would not be
aware of, but was your division sought for advice on that? Is this a highly inflammatory area to be poking around in?

Ms Kruk-No.

Mr Shevlin-Yes, we provided advice.

Senator LUDLAM-Thank you.



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