Page 4251 - Week 10 - Wednesday, 22 September 2010
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more than five per cent of its revenue from these activities or products. This is consistent with the screens established by many of the major funds and should be reasonably easy for Treasury to apply. The five per cent allows a margin for error and recognises the often very complicated company structures and practical realities. The draft bill recognises the realities of what is proportionate and commercially available.
The test set out in the bill allows the minister the flexibility in good faith to rely on contemporary circumstances and respond accordingly to changed behaviours. The test sets out that the territory must be satisfied on reasonable grounds that it is likely that no more than five per cent of companies’ revenue for the current financial year is likely to be attributable to the proscribed practices or products. This is a reasonable and proportionate standard that allows a sufficient level of flexibility whilst maintaining the overall integrity of the scheme.
On the question of what should and should not be a prohibited investment, this is obviously the most contentious issue in the bill. No doubt there will be vigorous and robust debate as to what industries we should and should not be investing in. This is entirely as it should be. The list in the draft bill represents the most common exclusions offered by commercial funds—that is, these are the types of practices and activities that many people in the community are already choosing not to invest in. Not only that, most of these issues are already monitored by the ACT Treasury and/or represent the current Assembly position. The intention of the proposed list is to ensure that these very mainstream concerns are considered by the committee, the Assembly and the community. We can then proceed to have the opportunity to debate all the common exclusions and develop a list that is appropriate for the ACT.
As I said, a very important point to make is that these prohibitions reflect Assembly policy. We have in recent years adopted a range of initiatives to reduce the number of people smoking, yet we invest in a way that means we profit from more people smoking. The government’s policy is that we should be a zero emissions city and significantly reduce our greenhouse gas emissions in the very near future. Yet we have investments that mean we profit from the sale of coal-fired electricity generation. We have a legislated moratorium on GM crops. It is reasonable to debate whether our investment practices should match our legislative action.
We are a jurisdiction that has legislated to implement human rights. The right to life is among those. Yet we are investing in the production of bombs that we know will kill innocent people. The rights of children and the right to freedom from forced work are recognised. It makes sense that we therefore should not be investing in companies that produce products in ways that breach those rights. The Greens’ view is that in a general sense territory investment practices should reflect these types of legislated standards. As I said, the exclusion list will be the subject of much debate and I would really like to encourage everyone in the community to participate in that debate.
As well as providing a list of exclusions, the draft bill also sets out the types of activities that the superannuation provision account, the ACT’s largest investment and for which long-term considerations must be taken into account, should be investing in. I am quite confident that no-one in the Assembly disagrees that everything on this list is a positive activity, that it is desirable that the ACT makes a contribution to. The list
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