Mary Aldred (Monash, Liberal Party) Share this | Hansard source

It's always a pleasure to follow my colleague and my 2025 classmate, the member for Forde. I rise to speak on the Corporations Amendment (Digital Assets Framework) Bill, which on face value is presented as a technical amendment but in reality also exposes a serious failure of legislative drafting, regulatory oversight and accountability that's gone unchecked for 14 years. This bill seeks to correct a drafting error, made under a Labor government in 2011, relating to the indexation of ASIC company review fees. The opposition will not oppose the bill in the House; however, we will not give it a free pass either. We will be seeking to refer this bill to the Senate Economics Legislation Committee, and we will reserve our final position until that scrutiny has occurred. On behalf of a lot of small businesses that I represent in Monash and have engaged with across the country in different roles prior to coming to this place, I think that is a good thing. The approach here is not obstructionist; it's responsible—because, while drafting errors can occur, the scale, duration and impact of this mistake demand serious examination.

In 2011, Labor introduced indexation for ASIC company review fees. The policy intent was clear. This is where unintended consequences can arise. Fees would rise over time in line with inflation. However, due to a drafting error, only the main annual review fee was properly captured in the legislation. Several other fees were not. These included late annual review fees, 10-year review fees and special-purpose company fees paid by charities, not-for-profits and superannuation trustees. Despite this, ASIC continued to apply indexation across all of these fees for the next 14 years. I'll repeat that: 14 years. There couldn't be a better example of 'set and forget' than what has occurred here. As a result, ASIC collected an estimated $150 to $200 million in fees that were not technically authorised in law. Those fees were paid in good faith by Australian businesses and organisations that had absolutely no reason to believe the charges were unlawful. They paid them in good faith.

This issue was not uncovered by whistleblower. It was not uncovered by a court case. It was not uncovered by a parliamentary review. It was only identified in late 2024 during an internal ASIC legal audit, more than a decade after the regulation first took effect. This is not good enough. That fact alone should have given all of us in this place pause. ASIC fees are not incidental charges. They're not, in effect, a tax on doing business. Every company in Australia must pay them in order to exist in our regulatory system. When those fees are unlawfully charged, that matters. It matters not just legally but morally. This error may well represent the largest retrospective tax validation exercise in Australia's history.

ASIC currently collects around $1.8 billion each year in fees and levies. That's more than a billion dollars from registry fees paid by Australian businesses, many of them small businesses, many of them mum-and-dad operators who work really hard to be able to afford those fees and levies. ASIC is known for its strict enforcement; it issues penalties for late payments, cancels registrations and applies late fees without hesitation. Small businesses know that missing a payment, sometimes as small as a few hundred dollars, has serious consequences. ASIC don't muck around.

I've previously sat as a member of ASIC's small business and industry roundtable. I've raised the plight of small-business people directly with ASIC, with its most senior executive members, and on occasion they've listened. But, on the whole, ASIC are not Robinson Crusoe here. Government bureaucracies are well behind the benchmark of where they should be when it comes to treating small-business people with respect, fairness and understanding. You can uphold the law and act with decency at the same time. When the shoe is on the other foot, there are a number of instances where ASIC is slow out of the gates in seriously considering the complaints of small business, and I'll raise a few examples.

A 2024 parliamentary report by the Senate Economics References Committee suggested that ASIC had often failed to protect small businesses by dismissing reports of corporate misconduct too quickly or by focusing only on minor enforcement measures. Key findings from the report regarding ASIC's failures include the dismissal of misconduct reports, with ASIC having taken no further action on approximately 66 per cent of reports of alleged misconduct received from the public; automated no-action emails, with the report highlighting that most statutory reports submitted by liquidators regarding insolvent companies are met with an automated no-further-action email, sometimes within 40 seconds of a submission; underenforcement and inadequate penalties, with the committee finding that, for matters where ASIC does take action, civil penalties are often at odds with the scale of offending and few criminal sanctions are achieved; the failure to use its full powers, with ASIC accused of not using the full extent of its powers to tackle serious misconduct such as illegal phoenix activity, which, as we all know, heavily impacts small-business owners; and its 'lighter' approach, with the committee noting that the express investigation approach adopted during the pandemic, which prioritised cooperation, resulted in insufficient enforcement.

I've had a little bit to say previously about the officiousness of regulatory bodies recently in their treatment of small businesses, and I'll give one example. Last year I wrote to Treasurer Jim Chalmers on behalf of drought impacted farmers in my electorate of Monash. They had had a very dry winter, which had been preceded by further dry conditions. So financially stretched were a number of these farmers that they were forced to sell off stock early, and, of course, that was going to affect their tax bill at the end of the financial year. I asked the Treasurer, on behalf of those farmers, to request that the ATO show fairness and leniency when those drought impacted farmers put their hand up and say, 'I'm struggling here.' I got a pro forma fact sheet back not addressing the issue, which demonstrated what I think is an enshrined contempt for, and sometimes wilful ignorance of, the plight of everyday regional Australians trying to keep their head above water right now.

It's a good example of how bodies like ASIC and the ATO employ a double standard of expectation on these issues. It's why it is extraordinary that the same regulator that fines a business for missing a $310 payment has been charging unlawful fees for more than a decade. This arose from an honest drafting error, but fairness demands the same legal standards apply to government agencies as those that apply, in my view, to small-business owners. The rule of law cannot operate in only one direction. The Corporations Amendment (Digital Assets Framework) Bill 2025 retrospectively validates 14 years of fees that ASIC had no legal authority to charge. In practical terms, it retrospectively legitimises more than $150 million in revenue.

Retrospective legislation is something the Liberal Party would ordinarily oppose. We are intrinsically wary about it as a general legislative principle, particularly where it shields government from legal exposure. Retrospective laws undermine certainty and trust in the system. They change the rules after the fact. Now, there are some special cases in instances of national security where retrospective legislation is required. However, we also recognise the serious budget implications if refund claims were allowed to proceed unchecked. This is a difficult balance that this parliament must now confront, and that is precisely why scrutiny matters.

This bill cannot simply be waved through on the basis that it's just a technical issue. It's not a technical issue. There are some profound principles at play here that demand scrutiny. It's not a minor error, and it's not narrow. It affects millions of entities across the Australian economy. Around 1.56 million currently registered entities have paid the affected fees. Approximately 795,000 deregistered entities were also charged. A further 440,000 active entities have been invoiced but have not yet paid. The sheer scale underscores why this issue cannot be dismissed as a footnote. The Senate committee process must examine how this drafting error went undetected for 14 years. It must examine whether concerns were raised earlier by ASIC or Treasury legal teams, and, if so, why were they not acted upon? It must also consider whether affected businesses should be entitled to refunds, credits or offsets. It must look squarely at which accountability mechanisms failed and how they can be strengthened to ensure this never happens again. Australians expect government to get the basics right.

To understand the real-world impact, it is worth looking at how these fees increased over time. The late annual review fee rose from $70 to $93 for payments 28 days late, and from $292 to $387 for payments more than three months late. The 10-year upfront review fee for small proprietary companies increased from $2,200 to $3,100. Special purpose company fees rose from $43 to $60. These are not abstract numbers for small businesses and for not-for-profits that survive on the smell of an oily rag; these dollars are consequential. They represent hard work, risk, blood, sweat and tears. They represent real costs borne by businesses and organisations who assumed, quite rightly, quite reasonably, that the law was sound.

Regulations made on 11 March 2025 have fixed the problem prospectively. This bill is required to apply that fix retrospectively, back to 1 July 2011. Without it, ASIC could face refund claims worth hundreds of millions of dollars, despite the fact that these fees reflected longstanding policy intent, relied upon by both government and business. But intent is not the law. This issue began under Labor. It remained hidden for 14 years, and it reflects a broader pattern of poor drafting and weak quality control that undermines confidence in our regulatory systems.

The Liberal Party's position is clear. We will not oppose this bill in the House, but we will not support it without proper scrutiny. We will push for a Senate inquiry to examine the full scope of the mistake and ASIC's accountability. This is about fairness, integrity and consistency. It's about doing what is right, because Australians expect and deserve better. If small businesses are expected to comply with every letter of the law—and they are—then government and regulators must be held to the same standard.

My drought-stricken farmers in Monash have not been given fairness, leniency or understanding by the ATO or indeed through my representations to this government. They deserve better. All Australians deserve better.

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