Sophie Scamps (Mackellar, Independent) Share this | Hansard source

I rise to speak on the Treasury Laws Amendment (Strengthening Financial Systems and Other Measures) Bill 2025 and, whilst not declining to give this bill a second reading, I move:

That all words after "House" be omitted with a view to substituting the following words:

(1) notes that the bill continues the practice of legislating the instant asset write-off measure annually, which creates uncertainty and discourages investment at a time when many small businesses are already struggling; and

(2) calls on the Government to do more to support small businesses, including:

(a) making the instant asset write-off permanent; and

(b) adopting a $20,000 tax-free threshold for small business operators with annual turnover of less than $10 million, as proposed by the member for Mackellar".

Let me start by saying that much of what's in this bill is sensible. It makes some important technical fixes and introduces a range of amendments across financial services, corporate regulation and taxation, including enhanced ownership disclosure for listed entities, implementing a recommendation of the Australian Charities and Not-for-profits Commission legislation review and extending consumer protections in the energy market.

It also legislates the instant asset write-off for small businesses. But, once again, we see this important measure being extended for just one year. Once again, small businesses will be left in limbo, holding on, waiting to see if the government will renew the measure next year. This is not how we should be treating the backbone of our economy. It is beyond time that we gave small businesses the certainty they deserve.

As I said, the bulk of this bill is sensible and necessary. Schedule 1 is about corporate transparency. It enhances the rules around substantial holdings and beneficial ownership for listed entities, making it clearer who really owns and controls companies operating in Australia. It brings interests arriving from equity derivatives into the disclosure regime so that all types of interests are treated consistently. It also ensures that foreign registered entities listed on Australian markets meet the same disclosure standards as local companies. Importantly, it gives ASIC stronger powers to enforce compliance and increases penalties for misconduct, ultimately cracking down on hidden ownership and improving corporate accountability—something I strongly support and something that is broadly supported by major interest groups, including the Australasian Investor Relations Association, the Australian Council of Superannuation Investors, the MUFG Corporate Markets, Ownership Matters, Transparency International Australia and the Tax Justice Network Australia. People in Mackellar expect fairness and they expect transparency. They want to see government hold corporations to account, and this measure helps deliver that.

Scheduled 2 deals with the charities and not-for-profit sector. It gives the Australian Charities and Not-for-profits Commission more power to disclose information about investigations and regulatory actions when it is in the public interest. This comes directly from the independent review of the ACNC, which recommended:

… The Commissioner be given a discretion to disclose information about regulatory activities (including investigations) when it is necessary to protect public trust and confidence in the sector.

Charities and not-for-profits do vital work in our communities. They support mental health, homelessness, education, the environment and so much more. Public confidence in their integrity is essential, and transparency is the foundation of that confidence.

Schedule 4 makes the technical amendments to the Scams Prevention Framework. These may be minor and technical amendments, but they matter. The people of Mackellar consistently tell me, loud and clear, that they are sick of scams. Whether it is credit card fraud, cybercrime and data breaches or transactions involving faulty products or impersonation fraud: it is hurting people and it is eroding trust. This bill clarifies the functions and powers of the Scams Prevention Framework general regulator, but let's be clear: the government's Scams Prevention Framework only goes part way. We need a whole-of-government crackdown on scams and a presumption of reimbursement as recommended by consumer advocates, including the Consumer Action Law Centre, Choice and the Australian Communications Consumer Action Network. Victims should not be further punished by having to wait months, and often years, for reimbursement, and I will keep pushing for this reimbursement model.

Schedule 5 is a set of machinery amendments. Schedule 6 extends the energy market misconduct provisions. In 2017, the ACCC was asked to conduct a detailed inquiry into the retail electricity market, looking at both supply and the competitiveness of pricing. This inquiry, the retail electricity pricing inquiry, or REPI, delivered its final report to the government in July 2018. It found that over the previous decade, average residential electricity bills had risen by more than 35 per cent in real terms.

The report identified a wide range of contributing factors and put forward 56 recommendations, aimed at bringing down prices and restoring consumer confidence. In addition to implementing many of those recommendations, the government introduced the Treasury Laws Amendment (Prohibiting Energy Market Misconduct) Act in 2019. It was designed to address some of the causes of sharply increasing electricity prices in the decade to 2017.

With key provisions due to sunset shortly, it's reasonable for the government to extend these provisions for another five years following the review by the Department of Climate Change, Energy, the Environment and Water into how they have impacted market efficiency, reliability, affordability, emissions and investment, but let's be honest: extending misconduct rules is not enough. If the government is serious about lowering energy prices, it must go beyond market reforms and regulations and home energy efficiency upgrades. It must stop backing and approving expensive fossil fuel projects, like Narrabri gas.

Research by the Institute for Energy, Economics and Financial Analysis shows that gas from Narrabri is up to 40 per cent more expensive than gas from Queensland. Narrabri gas will drive up prices, not to mention locking in decades of pollution and making our already weak climate targets harder to meet. It will lock us into high-cost fossil fuels and it will undermine our transition to clean energy. Extending energy market misconduct provisions as this bill does may be a sensible step, but cheaper, more reliable energy will be a pipedream if the government continues to lock in expensive gas infrastructure that undermines affordability and competitiveness.

As I said, much of this bill is reasonable and sensible; however, I am concerned about the measures in schedule 3. These change how often the Financial Regulator Assessment Authority conducts reviews of the Australian Securities and Investments Commission, ASIC, and the Australian Prudential Regulation Authority, APRA. The bill increases the frequency of those reviews from every two years to every five years, ostensibly to lessen the regulatory burden on ASIC and APRA and to allow for a more comprehensive review process of these financial regulators. However, this is contrary to the recommendations of the Senate Economics References Committee, which in its inquiry into ASIC's investigation and enforcement activities recommended that the Australian government reverse its decision announced in the 2023-24 budget to reduce the frequency of Financial Regulator Assessment Authority reviews from every two years to every five years and that the FRAA undertake an inquiry into the effectiveness of the oversight mechanisms of corporate regulators.

The ability of our corporate regulators to do their job to hold financial entities to account and to regulate financial services and products in a way that protects consumers is absolutely paramount. This has been made painfully clear by the collapse of the First Guardian and Shield master funds, which have left more than 12,000 investors, including many retirees, facing devastating losses exceeding in total $1 billion. These Australian managed investment schemes were allegedly riddled with misconduct. ASIC is now conducting multiple investigations into these collapses and seeking to preserve any remaining assets, but this case exposes serious flaws in our financial regulatory system and the importance of our regulators.

I have heard directly from people in my community who have been devastated by the collapse of First Guardian and are desperate for answers. We must ensure our regulators are empowered, resourced and independent enough to act swiftly and decisively in cases such as this, and I do not believe the government has sufficiently explained their decision to reduce the frequency of assessments of the effectiveness and capability of ASIC and APRA at a time like this.

Finally, schedule 7 is about the instant asset write-off. This measure has been rolled over year after year, one year at a time, always tucked into the Treasury laws amendments bills like this one, and every year small businesses are left wondering, 'Will it be renewed? Can I plan ahead? Can I invest?' The write-off is good itself. It helps small businesses invest in tools, equipment and upgrades. It improves cash flow and it reduces compliance costs. But the way it's delivered, one year at a time, with no certainty, is just not good enough. I've spoken to many local businesses—cafe owners, tradies, retailers and creatives—all trying to grow their businesses and trying to plan ahead, and they're tired of the uncertainty. To give small businesses the confidence they deserve, I implore this government to finally make the measure permanent.

But we should go further. That's why I have proposed a $20,000 tax-free threshold for all small businesses with an annual turnover of less than $10 million. This simple change could reduce a small business's tax bill by up to $5,000 a year—money that could be reinvested in innovation, energy efficiency, staffing, renovations or simply provide some much-needed cost-of-living relief. I strongly believe that it is the small-business owners themselves that are best placed to decide how to reinvest the savings into their businesses.

This policy is the product of months of conversations, listening and walking the streets of Mackellar. I have spent countless hours doorknocking local small businesses and hearing from them about just how tough the last few years have been. Businesses have told me repeatedly about rising costs, shrinking margins and the sheer pressure of trying to stay afloat. Our shopping strips have too many empty shopfronts, and behind every one is a story of struggle, resilience and, often, frustration. I ran a local business survey, and the results were clear. A staggering 86 per cent of respondents said that the escalating cost of doing business was their No. 1 concern.

Additionally, the Council of Small Business Organisations Australia has long called for meaningful release from the tax burden placed on small businesses, and they are right. Small businesses don't need gimmicks or policies that reward long lunches. They need real, practical support to help them grow, innovate and invest in their future. When small businesses thrive, they create jobs, lift productivity and strengthen our communities. But COSBOA has identified a major barrier to innovation. It is access to finance. A $20,000 tax-free threshold for small businesses would help unlock the capital they need to invest in new ideas, improve efficiency and build resilience. These are the kinds of reforms we need, not just temporary fixes like the yearly extension of the instant asset write-off but structural changes that give small businesses the certainty and support they deserve because they are the backbone of our communities. They are our cafe owners, florists, tradies, creatives and carers. They deserve a tax system that works for them.

So, in conclusion, yes, much of this bill is sensible. It improves transparency, strengthens oversight and supports consumer protections. While I support the extension of the energy market misconduct rules, I urge the government to take real action on energy affordability, starting with cancelling expensive gas projects like Narrabri. Secondly, I believe the government needs to better explain the decision to reduce the frequency of the assessments of ASIC and APRA, particularly at a time when many Australians are reeling from the collapse of First Guardian and looking to our corporate regulators for answers and resolutions. Finally, I urge this government to stop extending the instant asset write-off in a piecemeal fashion one year at a time. Small businesses deserve better.

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