People in the renewable energy industry are afraid to take on the Government due to their apprehended consequences. [The bullies are winning so far].
I need help, to back me up by enabling me to run a section 75.v of the Constitution, to get an injunction or a writ of Mandamus from the High court to put these ministers back in their box.
I believe I have standing. Any negotiations with banks aresuch, that the Clean Energy Finance Corporation is the preferred lender but the intention of the government to shut it, the CEFC, down has made me read the documents they produced; they appear to be political documents that seem not to match, the public utterances of former Treasurer Hockey and Christopher Pyne but, would appear designed, to cause fear and confusion in the Industry.
I am amazed that these guys think they could undo an Act of Parliament by ignoring the limits the Act placed on their revoking the previous Government’s investment mandate .
I seek your advice on the matter of Senator Cormann and former Treasurer Joe Hockey attempt to close down the Clean Energy finance Corporation, by using the Act itself; but ignoring the fact that section 65 of the Act, limits and precisely forbids with mandatory language, the very action they propose. The treasurer and now his replacement have run an outrageous bluff on the renewables industry, and the effect of their public utterances means they have almost got away with it;
They simply cannot change the Act without going back through Parliament. The original Mandate to the Board of the Finance Corporation was made by section 64(1) of the Act was there for Treasurer Wayne Swan, to empower the corporation, in the first instance, to proceed. Section 64 is not a vehicle for ministers to point the organisation in a direction against the object of the Act or to make or not make a particular investment.
The object of the Act is to ‘facilitate increased flows of finance into the clean energy sector.
They have demanded a higher investment return from the corporation to minimise exposure risk of taxpayers’ funds. It appears the direction is actually inconsistent with the object of the CEFC Act.The direction does seem to be transferred across from the Future Fund Investment Mandate Directions 2006.
The key sections of the CEFC Act are set out below.
It is worthy of note that the Ministers advisors have studiously avoided section 65 of the Act, which limits the ministers attempts to write a contrary investment mandate. Treasurer Swan and Senator Wong have been prescient in putting an ‘Effects test’ in section 65(a) just as Malcolm Turnbull has recently done in his ‘Competition Policy.
Section 64 Investment Mandate
(1) The responsible Ministers may, by legislative instrument, give the Board directions about the performance of the Corporation’s investment function, and must give at least one such direction. The directions together constitute the Investment Mandate.
Note: For variation and revocation, see subsection 33(3) of the Acts Interpretation Act 1901.
(2) In giving a direction, the responsible Ministers must have regard to the object of this Act and any other matters the responsible Ministers consider relevant.
(3) Without limiting subsection (1), a direction may set out the policies to be pursued by the Corporation in relation to any or all of the following:
(a) matters of risk and return;
(b) technologies, projects and businesses that are eligible for investment;
(c) the allocation of investments between the various classes of clean energy technologies;
(d) making investments on concessional terms;
(e) the types of financial instruments in which the Corporation may invest;
(f) the types of derivatives which the Corporation may acquire;
(g) the nature of the guarantees the Corporation may give and the circumstances in which they may be given;
(h) broad operational matters;
(i) other matters the responsible Ministers consider appropriate to deal with in a direction under subsection (1).
Section 65 Limits on Investment Mandate
The responsible Ministers must not give a direction under subsection 64(1):
(a) that has the purpose, or has or is likely to have the effect, of directly or indirectly requiring the Board to, or not to, make a particular investment; or
(b) that is inconsistent with this Act (including the object of this Act).
As you will be aware the Clean Energy Finance Corporation Act 2012, is now a trigger for a Double Dissolution of the Parliament although there is a certain reluctance to use it to fight an election.
The responsible Ministers, the now Treasurer Scott Morrison and Minister for Finance Senator Mathias Cormann are attempting to take the key investment mandate, which is of course, was the engine that starts and maintains the life of the corporation,they wish to open it up to be a vehicle, a mechanism for the Ministers to have more control of the terms of the board reporting back to them. This is an attempt to change the Act without taking that change back through the Parliament. The Arrogance is breathtaking.
The correspondence to the Board of the corporation from the Treasurer stated, “the Government’s policy is to abolish the Corporation”. As the responsible Ministers Senator Cormann and the Treasurer were defacto Directors clearly acting against their duty to protect the interests of the corporation under their direction; not to cut it down.
A reference to ASIC is appropriate?
The public and verbal instruction to move away from Wind and Roof top Solar, towards emerging technologies was not only against the object of the Act, it had the effect to cause many in the industry to have greater difficulty in attracting investment or gain financing.
There are many who could run a class action against this government.
Lenore Taylor points out that Turnbull has simply taken $1billion from the CEFC and funded his new CEIF and intends to simply have the ARENA act as an administrator.
From todays Guardian 23 of March 6016. Lenore Taylor writes.
“Malcolm Turnbull’s clean energy investment announcement is part good news, part bad news, part ideological shift and part shell game.
The good news is the Clean Energy Finance Corporation is safe. The $10bn CEFC was derided by the former prime minister Tony Abbott as “Bob Brown’s bank” and was so despised by the Abbott government that trying to stop its lending was one of the Coalition’s first acts after it was elected in 2013.
Coalition announces $1bn clean energy fund to invest in emerging technologies
Now the CEFC can continue its highly successful work, which has so far provided $1.4bn in loans to projects worth $3.5bn while at the same time generating a 6.1% return on the lending. It will no longer labour under the uncertainty of a government determined to abolish it, or a government periodically bending to the pressure from climate sceptics or anti-windfarm advocates by seeking to limit its investment mandate.
The bad news is the Turnbull government seems to be cementing in the $1.3bn in cuts that the Abbott government factored in to its 2014 budget from the Australian Renewable Energy Agency although it was never able to legislate them.
Because those cuts were not legislated, despite being accounted for in the budget bottom line, Arena still has a legislated spending program with $1.3bn in uncommitted funding over the next six years. Presumably the Turnbull government believes it will be able to legislate to change that after the federal election. By retaining it as government policy it can continue to book the saving.
The ideological change comes in Arena’s new role. It is effectively being subsumed into the CEFC, becoming the administrator of the new Clean Energy Innovation Fund, a subsidiary fund of the CEFC, lending money from the CEFC’s allocation. And the final decision on that lending will be made by the CEFC board.
In the short term it will finish doling out the grants programs it has already announced. In the longer term, instead of giving out grants, Arena will be simply be administering the new fund, which will make loans at a lower rate of return to earlier stage clean energy projects.
Clean energy groups are concerned at the abolition of grants funding, saying grants are essential at the earliest stages of technology development. Turnbull says this is a deliberate change in direction.
Turnbull faces ‘fierce campaign’ if tax cuts put before restoring school and hospital funding “This reflects a very big change in the way the government … is now approaching this type of investment,” he said on Wednesday. “Historically … the federal government has been very much like an ATM, it’s been making grants … without, frankly, a lot of follow-up as to whether it’s effective.
“We believe … the government should seek to be a partner and investor, seek to get a return. It doesn’t have to get the same high return that a private venture capital firm or a private bank would seek to get. It can get a very long-term return but, in doing that, by ensuring that you take a more economic approach, you will ensure that you have a much more rigorous analysis and that you will get a better quality of investment and a better quality of project.”
And then the shell game. The “new” Clean Energy Innovation Fund is not “entirely new”, as billed by the government and enthusiastically accepted by some media reporting, but is in fact funded entirely from the CEFCs existing borrowings and is more like another of the subsidiary funds the CEFC has set up — this time with the leeway of achieving a slightly lower rate of return so it can take on slightly higher levels of risk.
And despite the government’s insistence that Arena has been “retained” as a separate agency, and that it has not been merged with the CEFC, that appears to be the case only in name, if it now functions as a subset of the CEFC and very soon will no longer be making grants with its own money.
Turnbull’s attitude to the CEFC is big shift from his predecessor — in real terms and symbolically — but Arena appears to have been “retained” in name only”. From the Guardian Australia by Lenore Taylor.
My main concern is that Turnbull, Pyne, Hockey, Cormann and Hunt are trying to convince the public and the Industry, that they and cabinet can ‘re-purpose ‘ the corporation without going back through parliament; when the CEFC Act limits what changes can be made by the overseeing ministers in the terms of the ‘investment mandate’ and the limits the Act imposes on the ministers mandate. The responsible Ministers must not give a direction under subsection 64(1):
(a) that has the purpose, or has or is likely to have the effect, of directly or indirectly requiring the Board to, or not to, make a particular investment;
When you examine their behaviour; it is in fact, deceptive and misleading enough, to still destabilise the industry to have bankers and investors become gun shy.
Turnbull claims he is retaining something he was not able to abolish in the first place; and he still pretends his ministers were able to change an Act of the Parliament by making a change to the investment mandate that was beyond their authority.
Turnbull is not, the King he would love to be.
He is just a voter, like all of us, who happens to have the privilege to be holding in trust, many of our individual ‘sovereign registered votes’ and therefore to have the authority to occupy the position of Prime Minister until he loses our trust. I say he cannot change an Act of our parliament simply because he is the PM. He has to go back to parliament and get it (both houses plus the Queen) to make the change.
A lot of people have lost badly in the solar and wind industry and a lot were in Tasmania. There will be a class action that further delays the industry and the public just getting on with moving away from the hugely subsidised coal, gas and oil industries.