Press Conference, Sydney

PRIME MINISTER: Good afternoon.

Today I have received notice from the Honourable Sussan Ley, of her intention to resign as the Minister Health, Ageing and Sport. I want to thank her for her service to the Government as a Minister and as a member of the Executive over many years.

I will make a further announcement about ministerial arrangements next week. In the meantime, the Cabinet Secretary, Senator Sinodinos, will continue to act as Minister for Health, Aged Care and Sport.

Today I am announcing important changes to the management of parliamentarians' work expenses.

The Government believes that the work expenses of parliamentarians, including Ministers, should be administered and overseen by an independent agency. This already happens in some jurisdictions - notably in the United Kingdom.

An independent parliamentary expenses authority will be a compliance, reporting and transparency body. It will monitor and adjudicate all claims by MPs, Senators and Ministers, ensuring that taxpayers' funds are spent appropriately and in compliance with the rules.

The body will be governed by an independent board, which will include a person experienced in auditing - in audit matters - a person with wide experience in remuneration matters, the President - for the time being - of the Remuneration Tribunal, a former judicial officer and a former MP.

Specific details of this reform will be drawn up by the Special Minister of State in consultation with Members and Senators of both the major and smaller parties.

Further, and this will be perhaps the change that will have the greatest impact in the medium and long-term, the system that manages entitlements will be modernised to allow monthly disclosure of parliamentarians' expenses in an accessible, that is to say searchable, format.

Once again, the model is the process that is used in the United Kingdom. We're not slavishly bound to the United Kingdom model, I might add, but that is the very clear direction that we are focused on.

I’ve directed my Department to ensure that this project gets the urgent attention it requires.

The Government will continue to implement the recommendations of the review chaired by John Conde and David Tune into the parliamentary entitlements system, as we have previously announced.

Australians are entitled to expect that politicians spend taxpayers' money carefully, ensuring at all times that their work expenditure represents an efficient, effective and ethical use of public resources.

As politicians, backbenchers and Ministers, we should be as careful and as accountable with taxpayers' money as we possibly can be. We are dealing with other people's money. The Australian people are entitled to see that we are spending it wisely, appropriately, in accordance with the rules, but also in a manner that gets value for money. In other words, we're spending it as though it was money from a business of our own. We should spend it with even more care and more attention than we would spend our own money. We are fiduciaries for the funds that we have - fiduciaries for the people of Australia.

We owe the people of Australia the greatest transparency and the greatest accountability and having this information available regularly - monthly, as I said - that will ensure, I believe, a great change in transparency and accountability. We look forward to working with the Opposition and other Members and Senators to ensure that these important reforms are delivered.

JOURNALIST: Prime Minister, only on Monday, Ms Ley said that she had done absolutely nothing wrong and she said she was confident she would be back in the Ministry soon and would be cleared by the investigations. What changed in the intervening four days?

PRIME MINISTER: The Minister has - has been engaged in extensive discussions with the Secretary of my Department, as indeed, I have, and she has reached this decision to tender her resignation, or give notice of her intention to resign today.

JOURNALIST: What did Dr Parkinson find in his investigation?

PRIME MINISTER: I don't want to go into the details of Dr Parkinson's findings. Let me suffice it to say that the Minister has come to a judgement about the appropriate course of action and I want to acknowledge that. I believe that's the right judgement. She has made a judgement that is, I believe, in the interests of the Government and she has made an appropriate judgement and I do want to say that I thank her for her service over many years as Minister for Health and indeed, in other important positions.

JOURNALIST: Is this an admission though that she did the wrong thing?

PRIME MINISTER: I won't go any further into the situation of Sussan Ley. She has made a decision. She's resigned.

The important thing now is to ensure that for the future, Australians are absolutely reassured that Parliamentary expenses, which are work expenses after all, are appropriately spent by Parliamentarians and that they are - Parliamentarians are promptly, transparently, accountably delivering them. You know, look, the key here is – this is an area that I have to say, as somebody that came into the political world at the age of 50, not in the first bloom of youth, having had a career in business, I have to say I hate the term "entitlements", and I know it's been recommended by Conde and Tune that it should be abolished and I agree with that. These are work expenses. Really, the same principles that apply to the work expenses of somebody, you know, in business, working for you, working for your employer, should apply for politicians. I mean, basically, politicians should be seen to be spending money in circumstances where it enables them to do their work.

JOURNALIST: Do you believe it is overdue that it's now taken this long to set up an independent, you know, agency for this?

PRIME MINISTER: Well, I don't know about the question of timing. This has always been an issue and part of the problem is that the work that politicians do is in many ways unique. So, indeed, John Conde and David Tune acknowledge that in their report. But nonetheless, the principle should apply. Ultimately, these decisions have got to be the judgement of the individual Member of Parliament or Minister. That has got to be their judgement. Is this money, is this trip, is this airfare, is this taxi fare, is this incurred for the purpose of doing my job as an elected representative or as a Minister? That's the fundamental question. It is pretty straightforward. And clearly there will be areas where people's judgement will differ, and, therefore, MPs and Senators and Ministers have to be responsible for their judgement. That's why, I believe, the combination of an independent authority and timely, monthly reporting will make a very big change. It certainly has done in the United Kingdom. Very, very big change there.

JOURNALIST: Why has it taken so long to bring about the changes to MP entitlements?

PRIME MINISTER: There was an election in the middle of the year, as you may recall, and so that accounted for an interruption in the course of the Parliamentary year. But the Special Minister of State has been working on this carefully with both - both with our own colleagues and, of course, working with other parties as well, working with the Opposition, in particular. The important thing is to get it right, and I think the independent authority which is a very significant reform - that is my reform - I mean, that actually is not recommended by Mr Conde and Mr Tune, they don't recommend against it, as I recall, but this is, I believe, that the circumstances require us to be seen to be putting these matters plainly into an environment where people can be reassured that there is appropriate, independent oversight.

Now, this - I might say - this authority, which would obviously undertake much of the work that is currently being done by a part of the Department of Finance, it would also be able to provide advice to and rulings to MPs and Senators.

So if there is an issue that a MP or a Senator is unsure about what is the appropriate course of action, they should be able to get a ruling from that authority which they can then rely on.

I think it is very important to remember that there are 226 Members of the House and the Senate, representing the Australian people, engaged in public service, all of them seeking, in my sincere view, all of them seeking to do the right thing by the people of Australia.

What you find with these issues is often the result of mistake, it is often the result of errors of judgement, but above all, what we need to do is ensure that the Australian people are satisfied, satisfied beyond any shadow of doubt, that Parliamentarians are spending their expenses appropriately. I think, given the nature of our role, given the fact that we are representing the people, given the high responsibilities that we have, we have to go that extra mile or two or three to demonstrate that our expenditures, our expenses, are appropriate. I believe that is what this represents is a good means of doing that.

Now as I say, I look forward to working with the Opposition and indeed other Members and Senators, to making sure that this is a project of all of us. You know, what I have set out for you today, it is a proposal of mine as Prime Minister. It is of my Government. But this exercise in reform should be owned by every single Member and Senator. We need to put this issue into a place where people can say: "Yes, they are spending - they have business expenses, travel expenses, accommodation expenses, of course, as you do. But it is being done appropriately, transparently, accountably and there is an independent authority that is keeping an eye on it and ensuring that it is done in accordance with the rules.

JOURNALIST: How much is it going to cost to keep tabs on the expenditure of these politicians?

PRIME MINISTER: Well, if you are asking the additional cost, I believe, will not be material. One of the problems that we have with the existing system is that the IT is absolutely antiquated. Most of the forms are filled in by the politicians by hand. It is all paper-based. The reports that you do find on the Department of Finance website are big PDF files. They are, you know, months out-of-date when they are posted.

If you look at what the UK does, the information is put up there very promptly. I think it runs about two months in arrears, is my recollection. But you can go to any Member of the House of Commons and you can see what they have spent and why they spent it and so forth. It is very easily searchable. That is what we need to do.

I am firmly of the view that transparency is the key. Sunlight is the best medicine. It will ensure that politicians are very aware of what they are spending - very, very aware, even more aware than they are now - and of course, it will provide great reassurance. I have done this sort of thing in other parts of my responsibilities. I firmly believe that putting information up there for the public, in as close to real time as you can, is highly desirable. I believe it will make a very important change to the way in which expenses are undertaken. Indeed, the way in which they are recorded and the way in which they are reviewed.

Now can I just say - we have had the last question. I just want to say that tomorrow I look forward to seeing some of you again when I will be hosting the Prime Minister of Japan, Shinzo Abe. We have a very important agenda to discuss; trade, regional security, global economic developments. Japan and Australia are great friends. We have a great collaboration on the economic agenda, on the strategic agenda and Shinzo Abe himself is a great friend of Australia. Lucy and I look forward to welcoming him and Mrs Abe to Australia tomorrow.

Thank you.