Angus Taylor (Hume, Liberal Party, Shadow Treasurer) Share this | Hansard source

I rise to speak on the Treasury Laws Amendment (Modernising Business Communications and Other Measures) Bill. The bill reintroduces measures advanced before the election to modernise AGM and other business communications rules and provides an initial response to the Australian Law Reform Commission review into financial services legislation. The former measures were contained in coalition legislation that lapsed at the last election. We will be supporting this bill and the amendments proposed by the government.

The bill implements law improvement measures across four streams. Schedule 1 introduces amendments to give effect to technology-neutral communications. Schedule 2 introduces amendments to implement recommendations of the ALRC review. Schedule 3 rationalises a number of ASIC instruments, and schedule 4 makes a number of minor and technical amendments. The bill revives and expands legislation that lapsed before the last election, as I said. The main body of additions to the bill implement initial recommendations from the Australian Law Reform Commission's review into financial services legislation commissioned by the previous government. As I said, the bill implements law improvement measures across four streams over those four schedules, and the amendments in schedules 2 and 4 are largely made within existing policy parameters.

In a little more detail, schedule 1 amends the Corporations Act and other Commonwealth acts to modernise communication methods available to consumers, businesses and regulators when interacting with each other by: firstly, extending the global communications regime, allowing members of certain entities to elect to receive documents in either hard copy or electronic form, and providing relief to entities that are unable to contact members under the Corporations Act; secondly, ensuring that regulatory bodies in the Treasury portfolio can hold hearings and examinations using technology; thirdly, updating payment provisions in Treasury laws to allow electronic payments to be used; and, finally, replacing requirements in Treasury laws to publish notices in newspapers with a requirement that notices be published in an accessible and reasonably prominent manner. These are all sensible modernisation provisions designed to make use of modern technologies in a way that reflects practice we are seeing much more broadly across the economy and across society.

Schedule 2 to the bill implements recommendations and other suggested improvements identified by the ALRC in Interim report A, which was all about simplifying and improving the navigability of Australia's financial services law. In Interim report A, the ALRC found that Australia's financial services legislation is challenging to navigate and complex for individuals and businesses who may have obligations under the law. This is an important area of red tape reduction and a very significant priority for this opposition, as it was for the previous government, because we know when we get out and talk to businesses across our communities that red tape is right at the top of the list of the issues that they have concerns about. We want to see sensible changes in that area, and we will always work with this government on sensible red tape reduction. It's a priority for us, and we want to see it as a priority for the government.

Schedule 3 to the bill amends the Corporations Act and the NCCPA to transfer longstanding and accepted matters currently contained in the ASIC legislative instruments into the primary law. The amendments will improve navigability of the law and provide industry and consumers with greater certainty and clarity when interacting with Treasury laws. That has to be, again, a good thing. If you're in business in this day and age, you have mounds and piles of legislation—state, federal and local regulations as well—that are constantly a barrage you have to deal with just to get the basics done. If you're a small business without a government relations department, an HR department and all the other departments, or a legal department that works through all these things, it is a nigh on impossible task. Simplifying it has to be a good thing and must be a priority of any good government.

Schedule 4 to the bill makes a number of miscellaneous and technical amendments to Treasury portfolio legislation. The amendments correct drafting errors, repeal inoperative provisions, address unintended outcomes and make a series of other technical changes.

I mentioned the importance of reducing red tape. It's an issue very close to my heart. Sadly, there are far fewer people in this parliament, frankly—particularly from the government—who have experience in business, particularly small business, and understand that red tape cripples small-business people. Small-business people want to get out and run their business. They want to serve their customers. They want to attract and retain the very best talent they can in a jobs market with a strength coming out of the pandemic that no-one could have dreamed of. That's what they want to spend their time on. That's what they have to spend their time on. Indeed, if they don't spend their time on that, they're going to lose out. They're going to lose market share; they're going to lose profits and revenues; and they're going to go backwards. So they have no choice but to focus on those issues central to their business around customers and employees. But you can't do that if you're dealing with red tape. You simply can't do it.

Independent researchers estimated that the annual cost to the economy of red tape is $176 billion a year. We know that it has to be a relentless focus. This is never-ending work. Those opposite like to say, 'If something wasn't done in the past, then it doesn't need to be done now.' But the truth is that red tape reduction is never-ending work for any government. A government must be continual and relentless in its focus on removing red tape. It's also important to note that the cost of red tape to the economy is more than just the direct cost, that $176 billion I talked about; it includes businesses that never started.

We know small-business people or people who want to start a small business—take a tradie who says they want to start their own plumbing or electrician business—start looking at what they have to do to start that business, and we know red tape is a very significant deterrent. Jobs are never created and ambitions are never fulfilled, because the tidal wave of red tape coming at that small-business person who wants to get started is just too much. Ultimately, they give up, and that is unfortunate. We don't want people who want to go into business to give up. We want them to keep going because they're the job creators. That's where jobs come from. They don't come from the government. They come from businesspeople who are building businesses. To the extent that it's government that creates a job, that's at the expense of those businesspeople because they have to pay the taxes that fund those government jobs.

Any businessperson you talk to will tell you that the cost and burden of compliance is, along with staff shortages, their No. 1 issue. And, of course, because they want to spend that time on attracting and retaining talent, bringing great people to their business and attracting and retaining customers, it's the one they don't want to have to spend their time on. I hear this as I get around and talk to business endlessly. In fact, we were down in Melbourne last week talking to small-business people. As the Treasurer was trying to explain his 6,000-word ideological essay to the press gallery, we were talking to small businesses down in the suburbs of Melbourne. That's where we were. We didn't have to explain what our economic policy is using long, complex, convoluted sentences and words, because it includes getting rid of red tape and bringing down inflation and interest rates, amongst other things—practical things that affect businesses today, not ideological diatribes.

APRA has pointed out in its information paper Modernising the prudential regulation that there are currently 140 prudential standards and practice guides in total covering the five APRA regulated industries—140 practice guides! The Basel framework—this is a global framework, not one that Australia can directly affect, other than as a part of an international process—has expanded from around 300 pages before the global financial crisis to 1,600 pages today.

The Australian Law Reform Commission has pointed out that the consolidated legislative framework for Australia's financial services sector runs to over 43,300 pages. We knew there was work to be done coming out of the global financial crisis to make sure that we had a financial services sector that was fit for purpose. The truth is, our sector performed better than most in the world, and has continually done so. But 43,000 pages is something that I think needs to be dealt with. Combined with further reforms of the coalition, this bill, which as I say we support, is expected to reduce regulatory burden for businesses by more than $500 million per year. That's a big impost.

Now, in financial services we know there are a lot of big businesses, and big businesses can handle red tape better than smaller ones, but it's still a cost. Ultimately, that has to be paid for by customers. We do want to see a lot more small businesses in the financial services sector; in fact, the technological changes that we are seeing right now are encouraging smaller businesses into the financial services space. That is a good thing, because that kind of competitive rivalry, that dynamic sector that you see when you have lots of smaller businesses coming in and taking on new innovations and taking different approaches to serving customers, is exactly what we need.

This project is no small task. The Treasury portfolio laws cover over 50 acts containing thousands of provisions spanning corporations law, taxation, competition and consumer policy and financial sector regulation. All of those areas of legislation and regulation have good objectives. There's nothing wrong with wanting to have a sector that is properly regulated, but do we need this much? Is there some of it we can just take out because it's not helping? Indeed, is technology making it easier nowadays for us to actually regulate in much smarter and much cleverer ways? This is the beginning, not the end, of reducing red tape and supporting deregulation. It must be just one of a never-ending series of initiatives and pursuits to focus on taking red tape out of our economy.

We should also remember, as we are talking about regulation, that the best regulator of any industry is an empowered customer. Everything we can do to empower customers to demand of their service providers what they need is a good thing. It's why I've been such a strong advocate in this place of good consumer and competition laws, making sure that they are focused on genuine competition, not vested interests or crony capitalism. That ensures that you have an empowered customer. Digital initiatives can ensure digital identity. There is a good example of this where we are making sure—and we certainly did make sure when we were in government—that the customer is given as much power as possible so that the customer can do the regulation, not a regulator sitting here in Canberra or another capital city.

Business needs a government that listens to them, not one that tells them that government is at the centre of the economy. When business does well, the economy does well, from the sole trader all the way up to big employers. As I said earlier, wealth creation doesn't come from government departments; it comes from hardworking, entrepreneurial businesspeople innovating, providing solutions to their customers, employing people, attracting great people and empowering them to do good work for their customers.

Sadly, the signs are not good for the focus on business as the centre of wealth creation in this economy. This government, to date, though I live in hope, is about more intervention, not less. We saw this in the Treasurer's essay over the summer. The Treasurer spent the summer writing a 6,000-word essay. This is at a time when Australians have taken, in many cases, the first holiday they have taken in a number of years where they could get out and really enjoy this wonderful nation we have. They could buy presents for their family and see all the family members in person at a Christmas event. I know from observing it that they got to January and many of them were looking at the credit card bill and the bank accounts and went, 'I wasn't expecting that.' It is a tough time for them as they are making ends meet. Many businesspeople are starting to see the impact of rising interest rates and rising inflation. Despite that context, we had a Treasurer who buried himself in his 6,000-word ideological essay focused on making government the centre of the economy. Government will never be the centre of the economy—at least, not an economy I want to be a part of. If government is at the centre, it's not a community and society I'd want to be a part of. The Treasurer believes his proposal for an activist government running the economy from the top is a solution to the challenges Australians face today. He thinks that's the solution.

Our solution on this side is about the aspirations of every Australian and the enterprise of every Australian business—empowering them, putting them at the centre of the economy, so that their dreams and visions are the dreams and visions of the government. We shouldn't be imposing our view of how they should live their lives. We should be empowering them to live their lives, to run their businesses the way they want to run them, to serve their customers, to manage their household budgets, to live the best lives they possibly can, to support their children and to give them the best opportunities possible. That's what government should be about, but the fact is that the Treasurer spent the summer writing this long essay. I read it, Deputy Speaker Claydon. It was hard work, I have to say, but I read it all. It is a damning statement on the priorities of this government that that is how he spent his summer.

He did do something else: he decided he wanted to change the look of the $5 note. He did that as well. That's a priority, isn't it? That's a priority, according to the Treasurer. Australians don't want to change who is on the $5 note, relative to what they really want. What they really want to do is work out how to make sure they've got more $5 notes to pay their bills, Deputy Speaker. These are the practical issues that Australians are facing, and, sadly, this is a government that we're seeing has already, just six months or so in, lost a sense of their priorities. Their priorities are not the priorities of the Australian people. It's a government that thinks it knows better than hardworking, aspirational Australians. Governments never know better than hardworking, aspirational Australians. They know what is right for their families, for their businesses and for their lives. It is really for them to make those decisions, and for government to do everything they can to enable them and to support them.

On this side of the House we don't believe in what we read in this diatribe, and, certainly, we don't believe in the Treasurer spending his summer on that kind of priority, because they are not the priorities of the Australian people. We believe that the private sector drives opportunity and prosperity, not government. We believe that a dynamic, resilient small business sector is at the heart of the economy—not bureaucracies, but hardworking small businesses. We believe that hardworking families know what is best for them, not public servants, and certainly not politicians. And we believe that the vision of every Australian should be the vision of our nation—that vision should not be a vision conjured up in focus groups or in long essays.

Now, as I said, we're talking about this bill and these important principles in the context of what's going to be a very tough year for Australian families, and tomorrow we're going to see the Reserve Bank make another decision on interest rates. The expectation in the market is that we'll see another increase. Consensus is that a 25 basis point, a quarter of a percentage point, increase is coming tomorrow. Some are saying it could indeed be more. We'll have to wait and see. It's a decision of the independent Reserve Bank, as it should be. But what we do know is that the cost of mortgage payments is going up dramatically. As Australians see the interest rate increases—nine consecutive interest rates, if we see one tomorrow—we see that being passed through to households and businesses, and we shouldn't forget that businesses are paying interest too. We've got the added impact of the fact that many Australians locked in mortgages at low interest rates and they're shifting onto flexible rates, and we're going to see more and more Australian families being hit with that. On top of that, a trip to the supermarket is costing more. Summer air conditioning is going to cost more. Rent is costing more. Fuel is costing more. Inflation is eating a giant hole into the household budgets of Australian families.

Over the 12 months to December 2022 the CPI rose 7.8 per cent. It's the highest movement since 1990. Rental price growth in Sydney and Melbourne has continued to increase this quarter, with both cities recording their strongest annual increases since 2014-15. We are going to hear a lot more of this from the Select Committee on the Cost of Living, chaired by Senator Hume, but it has already confirmed what families across the country are seeing. Woolworths have had to increase their food donations by around 20 per cent because of the increased demand from charities helping families who are struggling to make ends meet. As I've seen in my electorate and in the broader region that I live in in New South Wales, families that you might not expect to be suffering from mortgage stress are indeed suffering from mortgage stress—often two-income families. They've bought a house and they've paid good money for that house. They're enjoying the fact that they've been able to own their own part of Australia, but the truth is that their mortgage payments are escalating rapidly at the same time as we're seeing very strong inflation.

It's true that we have an independent Reserve Bank, and that is as it should be, as I said earlier. But it is also true that there is a great deal that government can do to take pressure off interest rates and inflation. The truth of the matter is that the Reserve Bank sets its interest rates within the context of the government's policies, and the government's fiscal policy in particular. The government's energy policies have an impact on inflation. The government's budget posture has an impact on inflation. In an environment where we are seeing strong inflation and sharply rising interest rates, it is beyond comprehension that this Treasurer, in the November budget, decided—the first time since the 1990s that a government have done this—to drop budget balance as an objective of the budget. That is absolutely extraordinary. The government dropped it. That commitment to budget balance has been there since the Charter of Budget Honesty went into place under Peter Costello back in the 1990s. It's been there ever since. No Treasurer has taken it away. Indeed, Wayne Swan maintained it. He didn't really bother about it too much, but he maintained it at least. This Treasurer has completely given up the ghost.

The truth is that, if the government aren't seeking to make ends meet, then households and businesses will have to do it for them. That is the reality. That is how economics works. So I implore the Treasurer: at the next budget—you've got another opportunity in May—bring it back. Get back to an objective of budget balance. Don't listen to that long queue of your Labor colleagues who all want to be heroes, who all want to throw gazillions of dollars at their portfolios. They've all got grand, visionary Labor plans. We know that. They want to leave their massive legacy. But it is all at the expense of the Australian people. If the Treasurer does spend more money, as we saw on the front page of the Australian this morning he was going to do—he told us it was his goal to spend more money—then the truth of the matter is that Australians will pay for that with escalated interest rates and inflation and potentially, in the future, higher taxes.

Let me spend a moment on taxes. We know Labor governments always want to tax more. They pretend otherwise. We heard them before the last election say: 'No, no. We're going to be a government that doesn't raise taxes.' But, within months of their getting into government, we saw this Treasurer floating the idea of getting rid of the stage 3 tax cuts. He was very careful in the lead-up to the election. Whereas the Prime Minister came out clearly and said, 'We're going to keep the stage 3 tax cuts,' the Treasurer hedged his bets. He has floated that balloon several times now. Before the budget in October last year, we saw him floating the idea of getting rid of the stage 3 tax cuts. He is revving up the usual pro-big-tax commentators in the media to say: 'We've got to get rid of these stage 3 tax cuts. We can't afford them.' He wants them to go. We know that. And, no doubt, in the lead-up to the next budget he is going to be looking for ways of taxing Australians more.

We've seen Labor's proposal on franking credits come out in the last little while. When you look at that, it's not the narrow approach to dealing with a very technical issue in the application of franking credits that we all expected and that was promised to us. Indeed, this is a full-blown assault on franking credits. That's what it is. This is a government that doesn't like franking credits. As we saw in the 2019 election campaign, they were going to get rid of them. Now they're going to do it the sneaky way, by the back door. Anyone who is worried about getting access to franking credits, which many older Australians rely on for their incomes, should talk to their accountant about what is coming forward in that legislation, because this is a full-blown assault on franking credits.

We haven't even been to superannuation. The Labor Party is scurrying away there with their favourite think tank, the Grattan Institute, looking at ways they can hit superannuation harder. This government, the Labor Party, has always seen superannuation as their money—not as Australians' money but as their money—to be used for their pet projects and to be taxed as they see fit. So I have no doubt that we're going to see an assault on Australians' superannuation in the coming months and years from this Labor government. They're certainly contemplating it; we know that. And I think they're going to have a good crack at it. Let's see. But one way or another, this Treasurer is going to want more money. He told us that this morning—more spending, is what he said, and he's going to keep floating ideas for how he is going to do that.

The truth of the matter is that when he spends more money, just as he did at the last budget—over $110 billion in extra spending in the last budget than in the previous one—he likes to pretend otherwise. He contorts the numbers in all sorts of ways. You just have to look at two lines: spending in the last budget and spending in this budget over the forwards: $110 billion of extra spending. Who knows how much more it's going to be at the May budget? If governments spend more, it puts upward pressure on interest rates and inflation—economics 101. That's how it works, and that is exactly what we're seeing. And of course then the Reserve Bank ends up having to do all the heavy lifting. Sadly, some of that heavy lifting may well happen tomorrow; it is expected to happen tomorrow. I have no doubt that if the government doesn't do the heavy lifting then the Reserve Bank will do exactly that.

It's not just me saying this. A new IMF report makes it very clear that one of best things the government can do to alleviate pressures on the budget and inflation is to rein in spending and reconsider some of its big spending programs. In the budget-in-reply speech the Leader of the Opposition offered to work closely with Labor on some of the more-difficult programs in that area—important programs—that we want to see succeed, like the NDIS. It is time for those opposite to focus on the priorities of the Australian people—not their own priorities, not their own dalliances but the priorities of the Australian people, and that is: helping them to deal with the cost-of-living pressures they are facing in their households and in their businesses every single day.

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