Wyatt Roy (Longman, Liberal Party) Share this | Hansard source

If you want to come and have a chat to Ian, we can explain to him why the thousands of dollars that he is going to save as a result of this business does not mean anything. I think the word that the shadowy Attorney-General used was a 'fizzle'. I think this bill will make a very big difference to businesses in my electorate. Ian has said it means he can hire new staff and create jobs in the electorate and in Caboolture.

I am very proud to rise to speak on the Personal Property Securities Amendment (Deregulatory Measures) Bill 2014, a significant piece of reform. This is part of something that exemplifies the government's commitment to slash red tape by a billion dollars a year. There was bipartisan backing when the former government introduced the Personal Property Securities Act in 2009. It fundamentally changed the system for security interests in Australia by establishing a single national law governing the creation, registration, priority and enforcement of those interests in personal property. More than 20 state, territory and Commonwealth property and security registers were replaced as well as more than 70 pieces of supporting legislation. The act has resulted in a single online personal property security register known as the PPSR, with initially migration of 4.7 million registrations.

In simple terms, under these changes any holder of a security interest in a personal property must register with the PPSR to ensure that their claim to that property is maintained. One of the primary objectives of the regime was to provide greater confidence to lenders in the security of their interests. But concerns have been raised by Australian businesses, especially the hire and rental industry, over the significant administrative burden that has resulted, including substantial compliance costs and fees. Under the PPSR, personal property generally includes goods or inventory, intellectual property, shares, debts and contractual rights.

On our side of this place, we recognise that the great creator of wealth, prosperity and employment in our nation is not the government; it is the private sector. The best thing that we can do as a nation is unshackle this driving force of the economy to scrap unnecessary regulations that businesses in my electorate spend hours, days and weeks attempting to satisfy. Their staff are tied up in red tape rather than responding to the needs of the customers and making sales.

If further reform is required so that our businesses can grow and more fully prosper, we will listen and we will act. And so it was with this reform. More than 12 months ago, I organised a function in my electorate, as I was informing the shadow Attorney-General, with the Parliamentary Secretary to the Prime Minister, the member for Kooyong, the honourable Josh Frydenberg, where local traders told how excessive regulations were stifling their success. The now Assistant Treasurer blazed the trail for implementing the government's colossal deregulation agenda. After one of the function attendees, Ian Rogers—who I already mentioned—mentioned these elements of the PPSR, I initiated further discussions with the parliamentary secretary, who then conferred widely with the hire and rental industry. The seeds of this consultation helped sow the legislation before the House today. Our approach is indicative of an inclusive and constructive government, which understands business and is determined to eliminate the fiscal drag of bureaucracy and overregulation.

This legislation proposes to unclutter the rules on when a lease is considered a security interest. Under the PPSA, arrangements where property is deemed a security interest include the lease of goods where the lease term is for more than 12 months or an indefinite term and the lease of serial-numbered goods such as motor vehicles, boats and smaller engined equipment for 90 days or more. The two deeming provisions have become a major headache for rental and hire companies. Confusion has reigned over two rules covering different goods and different lease terms, with some businesses forced to make multiple registrations to ensure that they are covered, all at a cost of money and time. This bill will repeal the provision deeming leases of 90 days or more for serial-numbered goods to be security interests. In addition, the government will amend the PPSA regulations to encompass a more reasonable and sensible definition of 'a motor vehicle'.

Here is the kicker: under the legislation currently, if a hire company chooses not to register its equipment, it risks losing it if the second party renting the goods becomes insolvent. A liquidator may be able to take title and sell the property to help pay back creditors. Only the successful passage of this bill into law will mean that hire firms leasing serial-numbered goods for between 90 days and 12 months will no longer have to register the equipment in order to protect their ownership rights. Instead, for these leases, a hire business would rely on proof of its ownership of the goods—that is, the lease agreement—to avoid loss in the event of a customer's insolvency or where the customer had sought to sell the goods to a third party. This would align the PPSA with PPS regimes in other common-law countries such as New Zealand and Canada.

When he spoke up on the impact of the 90-day rule, R&R Hire's Ian Rodgers told the then parliamentary secretary and me about our local business community and how it was costing him thousands of dollars a month in registration fees and compliance costs, including encumbering his staff with paperwork instead of their doing their job, which they could otherwise be doing, growing that business and potentially employing more people.

They're costs I've been absorbing …

That is what he said. He did not mince his words. He said:

There's no other word for this regulation but ludicrous. Around the country, we've seen multiple cases of hire companies which have lost excavators or other machines to their customer's liquidators.

But, with the emergence of this bill, he has since told our local media:

… after years of trying to get something done, we've got this relief within six months of raising it with Wyatt and Josh.

He said, 'With this change, we've been able to put the cost we've been absorbing into growing our business.' He added:

It's been a hell of a result.

The amendments in this bill are a huge win for Longman's local hire companies, including Skyreach, which, like R&R, is located in Caboolture. I am very happy to have played my part.

As I mentioned, the amendments in this bill sit inside our red-tape repeal program, which was underscored by the government's initial red-tape repeal day, where more than 10,000 acts and regulations were axed, removing more than 50,000 pages from the statute books. It was the first of many dedicated repeal days. Indeed, earlier this year, in the third such day, another $305 million in net red-tape reduction was achieved, further easing the burden on Australian businesses, community organisations, families and individuals.

The coalition set itself a target to make decisions reducing the regulatory burden by a billion dollars a year. Not only did we exceed that net target by more than double in our first year, but we are well on our way to meeting a new target of a billion dollars worth of deregulatory decisions for 2015. Associated benefits for small business include the repealing of the carbon tax, which has removed a $9 billion a year hit on the economy and is saving more than $85 million a year in monitoring, record-keeping and reporting costs; establishing a dedicated small business hotline at the Fair Work Ombudsman so small businesses can access fast, binding advice on employment terms and conditions; using standard contract terms for government procurements under $200,000 and using credit cards for payments under $20,000 so small businesses can be paid sooner—

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