BILLS (Second Reading): Corporations Amendment

24 November 2021

I rise to speak on the Corporations Amendment (Improving Outcomes for Litigation Funding Participants) Bill 2021 and the amendment moved by my friend and colleague the member for Whitlam. Those opposite tell us this bill is all about protecting the interests of plaintiffs in class actions, that it'll make it easier and fairer and that it will lead to equitable outcomes and the proper functioning of justice in class action proceedings. But let's have a close look at those claims.

For a start, this bill creates a new requirement that class members agree, in writing, to be members of a litigation funding scheme and to be bound by the scheme's constitution. For a funder to obtain a fee from a claimant, the claimant must be a member of the funding scheme. This is a departure from the current opt-out model, where individuals who do not wish to participate in a class action have to opt out. The current opt-out model is well regarded. It was recommended by the Australian Law Reform Commission at its inception. In first recommending it, they noted that it promotes access to justice. It's an efficient, simple way for everyday people to engage with the legal system in order to get justice. This is the first bit the government gets so wrong with this bill. They'll make it more difficult for members of the public to sign on to class actions and more difficult for their legal representatives to get class actions off the ground in the first place.

The second change those opposite want to make relates to the distribution of funds at the end of proceedings. Those of us on this side, of course, wish to see those funds distributed fairly. But, as with so much of the legislation we see from this government, they've made a half-hearted attempt at a positive change here and just haven't got it right. Their changes to the way funds are distributed are expected to have a number of unintended consequences, based on the evidence of experts during the committee inquiry process. It discourages settling disputes, which can lead to proceedings dragging on and costs mounting for both plaintiffs and defendants. It also creates uncertainty in the process, which, again, disincentivises class actions getting off the ground in the first place.

We can see from these areas the government is looking to alter in this bill that this isn't about making class actions fairer at all. In fact, this legislation is all about doing their mates in big business a favour. It's about making it harder for ordinary people to stand up to big business and get justice. One submitter to the committee inquiry on this bill referred to it as 'Orwellian gaslighting'. How true is that! How true is that, in fact, for so much of what this government has brought forward in its eight very long years in power. Australians now know that, when this government says it'll do something, it can't be trusted, and they don't think—they know—that, when the Prime Minister says something, he certainly can't be trusted.

After those eight long years, after so many promises from those opposite and from the Prime Minister, what do they have to show for it? Stagnant wages, work that is more insecure than ever and living expenses through the roof. We all know people are paying $2 a litre to fill up their cars with petrol right now. Those opposite have nothing to show for their time in office, so they bring out the marketing boffins and they spin, spin, spin their way into an election. They publish their glossy pamphlets, they spend tens of millions of taxpayer dollars on advertising that says pretty well nothing, and they come up with slick names like the one for this bill—'enhanced outcomes', 'streamlined services' and 'fairer standards'. After eight long years, Australians know what to expect when they see terms like that from the Liberal-National government. They know they can't trust those opposite to do what they say they will do. We know that, when they say 'enhanced outcomes', they don't mean for ordinary people; they mean for their mates in big business, the hyperwealthy. When they say 'streamlined services' it means cuts, cuts, cuts. When they say 'fairer standards', they're undercutting protections and letting the market rip.

This bill fails the simple test of whether it will make the lives of Australians better. It won't. It does nothing more than protect those who have potentially wronged a large number of people. But I suppose those opposite can pat themselves on the back for a job well done when that's the outcome. Don't think I'm exaggerating on that point. What we need to make clear is that those opposite know what they're doing. It is not an accident that this bill leads to worse outcomes for ordinary Australians. It is by design, and they're entirely shameless about it.

The committee inquiry process brought up a myriad of issues with this bill and outlined the perverse outcomes I've spoken about so far. But what I find most fascinating is that there were even questions raised about the constitutional validity of this bill. Someone as respected as former Solicitor-General Justin Gleeson SC has raised concerns that this bill is unconstitutional, and still the government presses ahead. It's incredible. So set are they on undermining the legal rights of everyday people that they're more than happy to disregard the Constitution and the opinions of multiple legal experts on that matter. They heard it in the inquiry from evidence. Labor drew attention to it right throughout the process and in the dissenting report. But what did the government members do? They misrepresented the evidence of the experts and then jumped on to the next point. You've got little time to worry about matters of the Constitution when you've got to protect multinational corporations.

I want to come back to the importance of class actions and why it is so important that we oppose the bill. Class actions, as I've outlined, give more equitable access to justice. They open the door to the legal system for ordinary people, often against massive corporations. They are an opportunity for people who have been wronged to shield themselves from the upfront costs and risks of litigation. Without a properly functioning class action system, the door to justice would be closed for many—perhaps most—Australians. It's an efficient, easy and fair way for people to engage in legal action and seek justice.

Class actions are also about class. They are about power in numbers. While some people don't have a platform or a loud voice, when you amplify this through class action there can be a mightily loud collective voice. Class actions are all about engaging with people who may not be at home in the foyers of courts or the chambers of lawyers and making sure that their concerns can still be addressed by the legal system. You don't need to have a lot of money to be involved in a class action and get legal representation. They create economies of scale. They make it more financially viable to take legal action against well-resourced defendants, including large corporations or government departments. Having a group of individual claims where people have had similar experiences or circumstances means more people get access to justice.

But this bill seeks to disrupt the way class actions work by creating an additional barrier for people to engage—by making them opt in, rather than opt out. Not only do those opposite want to make it more difficult for Australians to participate in class actions; these amendments also seek to limit the role of the legal system in holding corporations, large organisations and even the government to account. In our society, there are many crucial checks and balances to protect Australians. Obviously we have the media, which operates as the fourth estate by journalists' scrutiny, publishing stories and holding people to account. The legal profession is a crucial additional layer of scrutiny in holding corporations and governments to account. But a class action can also shine a spotlight on a problem and add to accountability. Highly skilled lawyers and legal practitioners forensically analyse documents. They interview people and work to get to the bottom of a situation. Even the fear of a class action which brings careful analysis and legal might, sometimes resulting in media interest, can be a powerful motivator for companies and organisations to respect the rights of clients and those they engage with. The scrutiny that class actions bring helps to protect all Australians, even those who aren't actively participating in them.

In Australia, we have seen landmark class actions brought against banks, governments and big business. Take the stolen wages case, where First Nations people were able to recover stolen wages from the Western Australian government through a class action. We have heard expert opinions that this case would have been unlikely to proceed had this bill been in place at the time. We have heard this opinion mirrored for cases of the underpayment of award wages, for the overcharging of life insurance by banks and for environmental contamination. Successful class actions on these issues, which got justice, would not have proceeded had this bill been in place.

Again, I want to make it clear that I am not the first one telling those opposite this, nor am I the most qualified person to tell them this. Experts, independent bodies, academics and lawyers have all told them that this is plainly true, and yet they press forward. That's because, for this government, access to justice is meaningless. The benefits of class actions, which I have just outlined, are seemingly meaningless to them. Justice for working people, the repayment of wages, dealing with unfair insurance charges and the payment of damages for environmental contamination or, as we have seen recently in the media, for medical malpractice just don't seem to matter to this government. Why not? It's because this government puts the interests of working people behind the interests of the wealthy, of big business. They've got nothing to lose, because we know if you have big pockets there are no barriers to justice. If you have blind trusts behind you, there are no barriers to justice. You can waltz on into the courts with your legal team in tow and punch down. If they feel they've been misrepresented, they sue. If they feel they've been wronged, they sue. It's because they can. It's because funding isn't an issue for them.

But everyday Australians, I can tell those opposite, don't have the backing of blind trusts. They don't have tens of thousands or hundreds of thousands of dollars to spend fighting a legal battle they don't even know if they are going to win. And so I hear so often from constituents and from people around the country that the wrongs will go unchecked. Sure, they probably have a case to mount, but, whether it be medical malpractice, stolen wages or another issue, they just don't have the means to fight it. That is what class actions are for.

I am proud of us, on this side of the House, because we are here standing up for everyday Australians. They, too, deserve justice. They deserve a fair hearing. They deserve to get it without the stress of going broke if they lose. That is what this is about. That is why we are opposing this bill. So I urge those opposite, if they care about fairness, if they care about the rights of ordinary people to get justice, to withdraw or vote against this bill.