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Legislative Assembly for the ACT: 1999 Week 1 Hansard (17 February) . . Page.. 262 ..

MS CARNELL (continuing):

these people are saying. Many of them do this for a living. They sit on a number of different boards and are remunerated for that. If they ended up the subject of a political slanging match in an Assembly committee or in this place, that could quite significantly impact on their professional credentials.

The ones I have spoken to - and they are probably the most prominent board members and company directors in the ACT - believe that Mr Quinlan's Bill would compromise the ability of boards of Territory owned corporations to meet their responsibilities under the Corporations Law as these boards would have no control over the appointment of directors to subsidiary boards.

Mr Speaker, this is really important, and I am concerned that many people are not listening. Mr Speaker, as you would be aware, many Territory owned corporations, particularly ACTEW, have subsidiary boards underneath the primary board. Subsidiary boards head up or control various arms of Territory owned corporations. The boards of Territory owned corporations, say ACTEW, must have control over the people they appoint to subsidiary boards. It is their corporate responsibility under the Corporations Law to do that. If the board of ACTEW have responsibility for making sure that the whole of ACTEW is run in the best interests of the shareholders and in the best interests of the company, then they must have direct control over what happens in those subsidiary companies as well. This Bill would significantly impact upon their control over the appointment of directors of subsidiary boards. That is not something that this Assembly should take lightly. The Corporations Law is very exacting legislation and puts an enormous amount of pressure on board members. As I am sure many of us know, board members these days have their houses riding on their performance and the performance of their boards in relation to the Corporations Law and our TOC Act.

Mr Speaker, members have indicated to me that the time delays implied in Mr Quinlan's Bill could also compromise the performance of TOCs and their subsidiaries by leading to substantial periods of time in which a board may not have the range of skills needed for its effective operation. Again, I make the point that Territory owned corporations like ACTEW particularly but also Totalcare are required to make many decisions quite quickly because they are operating in volatile marketplaces. Totalcare competes for very sizeable contracts not just in the ACT but around New South Wales and in Sydney. Their capacity to ensure they have a full range of skills for effective operation is essential to the shareholders - that is, the people of Canberra or the two Ministers involved on behalf of the people of Canberra - but also essential for the senior board members themselves if they are to do their job under the Corporations Law.

Mr Quinlan and others may say, "The situation would not be politicised. We would not knock anybody back". I accept that on the whole that has been the situation, although on a few occasions when proposed appointments have been put to a committee the committee has required more information. Why go down this path at all if it is not going to make any difference to the current situation? I am advised by people who certainly should know about these things that this Bill could lead to the ACT having to fill board positions with what you could call second stringers, people who are not the best people for our Territory owned corporations, people who may not be on other boards or of the calibre that we want on our Territory owned corporations. In other words, we could end up having to settle for second best. We cannot afford that, Mr Speaker. Our Territory

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