Tuesday, 1 December 2015
Treasury Legislation Amendment (Repeal Day 2015) Bill 2015; Second Reading
I rise to speak on the Treasury Legislation Amendment (Repeal Day 2015) Bill 2015, and in doing so wish to commend the work being done by the member for Eden Monaro, which follows on from the excellent work of his predecessors in that role, the members for Pearce and Kooyong.
The government's regulatory reform agenda has been a resounding success. We have exceeded our red tape target by finding around $4½ billion over two years, compared with our target of $3 billion over three years. That is good news—good news for the parliament and good news for the nation. We have improved systems for regulatory decision making. All cabinet submissions are now accompanied, of course, by an analysis of the regulatory cost and benefit, and we have changed the way that we approach regulation. This reform is not just fluff or time to fill in parliament—we are actually getting on with the job of making it easier for business to do what it does best, the farmers to do what they need to do on behalf of the nation and, indeed, for the nation's economy to tick on nicely.
It is the right time to update and expand the regulatory reform agenda, and that is what we are doing with this Treasury legislation bill. It needs to support flexibility in our economy. The new Prime Minister, the member for Wentworth, has said there has never been a more exciting time to be an Australian. I would add that there has never been a more exciting time to be a regional Australian. We have the preferential trade agreements negotiated by the trade minister with South Korea, with Japan and with China, and he is in talks at the moment with India and we now have the Trans-Pacific Partnership Agreement, and I can inform the House that people in the Riverina are excited about the prospect of those arrangements bringing to them the ability to increase their export reach. Certainly that is the case with the wine producers in the Murrumbidgee Irrigation Area. One out of every four glasses of Australian produced wine come out of Griffith alone, let alone the entire Murrumbidgee Irrigation Area. I note, Mr Deputy Speaker Broadbent, that you act as though that is tremendous information, and it is true—it says so on the billboard as you drive into Griffith. There is a big billboard that gives that exact fact, and there is a little asterisk on the billboard, I am sure, that indicates that it is indeed a fact.
The wine producers of Griffith are hard workers. It is land that no-one else wanted. The explorer Oxley said no-one would ever try to turn that land into an agricultural environment, but they have. They have done it because they have been able to utilise water to its maximum advantage. That is facilitated by government getting out of the way of farmers and letting them do what they do best, and that is what we have been able to do. I see the member for Canberra—I know that she will enjoy a wine over the festive season, and hopefully it will be one from Griffith. On 5 August, not too long ago, we heard there was to be a $263.5 million boost for on-farm irrigation in southern New South Wales to improve on-farm irrigation efficiency and return water savings to the local environment. That is a tremendous boost for the farmers in my region, for those wonderful wine growers.
This reform agenda is good government. What was not good government was what occurred under Labor with their foreign investment regime. I was pleased that the new Treasurer, the member for Cook, stepped in over the sale of S. Kidman & Co. landholdings. I have a joint media release from the shadow Treasurer, the member for McMahon, and the redoubtable shadow minister for agriculture, fisheries and forestry, shadow minister for rural affairs, spokesperson for Country Caucus, whatever that means, and member for Hunter. Their joint media release says:
Labor is concerned that the national party has run a self interested intervention in this matter.
Never mind that in the media release 'national party' has a lower case 'n' and a lower case 'p'. Anyone will know that that is a proper noun and there should be an upper case 'N' and an upper case 'P' for National Party—it is the name of the party. I am not so pedantic that I am too worried about that, but I think what should be in capital letters is national interest—and Labor failed the national interest test every time when it came to foreign investment. The member for McMahon had the opportunity to show that he cared about the national interest when Archer Daniels Midland's bid for GrainCorp came across his desk back in 2013. What did he do? Nothing. He sat on his hands and left it as a booby-trap for when Labor lost power, hoping it would cause a wedge issue between the Nationals and the Liberals. But it did not, because the Liberals understood that it was against the national interest that ADM take over GrainCorp, take over the entire grain industry on the east coast. They understood, as the National Party of course did, that the grain industry does not need to be controlled by a boardroom in Illinois in the United States of America. We passed the test. Labor has never passed the test when it comes to the Foreign Investment Review Board save for the potential sale of the Australian Stock Exchange to Singapore. The member for Lilley did not care, the member for McMahon did not care, and then when we get on board with the national interest and block the sale of S. Kidman & Co., what do we get? We get this pathetically written media release from the members for McMahon and Hunter talking about who said what to whom, whether the member for New England, the Minister for Agriculture and Water Resources, might have talked to the member for Cook, the Treasurer—Labor seems fixated with who says what about whatever subject. In question time over the last fortnight they have been fixated with who said what to whom and when. Ask some real questions about agriculture, ask some real questions about innovation, find out about the rollout of broadband, but do not keep coming in here and talking about an issue from four prime ministers ago. It is boring, quite frankly.
This regulatory reform agenda is focusing on productivity—indeed it is, because the member for Eden-Monaro, the Assistant Minister for Productivity, says so. He is getting on board with what the members for Kooyong and Pearce did with the red-tape repeal day. He is doing a fine job. He says in his media release—and this is a media release worth reading, member for Canberra:
A significant measure will make it easier for terminally ill people to get access to superannuation money.
That is good, and I know the member for Canberra would agree with that. He goes on:
We have improved our systems for regulatory decision-making and begun to change the culture of decision-makers and regulators to one that recognises the burden that is imposed both by the regulations and by the way it is administered.
We have introduced legislation that will repeal 3,600 spent and redundant Acts and over 10,000 legislative instruments from the Commonwealth books.
That will trickle down, filter down, into small business and into making sure that the red tape burden is lifted and that, dare I say it, the green tape regulatory burden is lifted.
But what do we hear from the other side when it comes to talking about business? I have never seen a business that they did not want to form a picket line out the front of. All they want to do is to impose an even larger carbon tax upon those businesses that did it very tough under Labor. Thankfully confidence is back into the economy. Thankfully investment is back into the economy. And thankfully people, just prior to Christmas, in that very busy retail period, have the optimism to go out and to spend up, which is good. But I tell you what: if Labor gets back into government we are going to see the carbon tax return—but not just any old carbon tax; this is the Tyrannosaurus rex of carbon taxes. It is going to be a monster, crunching and munching—as the Treasurer has indicated—the economy and business alike.
We kept our promise to the people of Australia—and that is why we were elected at the last election—by repealing, abolishing, getting rid of and eradicating that unnecessary carbon tax. It did nothing for the environment, but it certainly hurt businesses. It certainly hurt families every time they hit the switch on the power point for air conditioning, and for heating during winter. They knew that the coalition were the responsible people who would lift this unnecessary burden from their household budgets. They knew that we were the responsible people who would lift that unnecessary burden from their groceries bills. And we did just that. They also knew that the mining tax was nothing but a crippling burden on the mining industry.
It raised a little bit. It was only a smidgen of what Labor said it would raise—I think it was about $126 million—but there were billions overspent and promised. There were billions of dollars promised to be put into programs, grants and projects, but they had no hope of being funded by a scheme which raised just a smidgen of the money that Labor had promised. They promised rivers of cash from the mining tax which never materialised into much at all. The member for Canberra knows that. I know that she understands deep down the fact that we need a strong economy. I know that she understands that we need Australian agriculture to fire.
Getting back on to my foreign investment bandwagon, because it is close to my heart, I am so pleased that the new foreign investment regime, which is a robust one, comes into force today. Today is a red-letter day: not only are we getting rid of red tape but the new foreign investment regime also comes into force with stronger penalties for investors who breach the residential real estate rules and with existing criminal penalties being increased to $135,000 or three years imprisonment, or both, for individuals and up to $675,000 for companies. It is important for people who live in those metropolitan areas to know that there is going to be housing for young people—the big Australian dream is to own your own home—and it is important also for Australian agriculture that it gives farmers the certainty and surety that agricultural land, prime farmland, is not going to be gobbled up by companies who will come and take the land. The alternative proposal is to lift the foreign investment threshold at which the Foreign Investment Review Board looks at these matters, which is $15 million cumulative for farmland and $55 million for agribusiness. What do Labor want to do? What does the member for Hunter want to do? The threshold will be $1,000 million. That is the against the national interest.
I do not mind if Labor wants to put 'National Party' in lower case; I could not care less. They should be putting in capital letters the national interest. They should be applying the national interest test to everything they do, but they do not. They do not support their own savings measures. They talked about them when they were in power for six sorry years. They talked about them in government and they just blocked them when they got into opposition. Hopefully they will be in opposition for a long time to come, because Australia needs a coalition government with the Liberals and the Nationals working collaboratively together to boost the economy, to boost innovation—as the Prime Minister often talks about—and to boost productivity. We are repealing that redundant red tape—and, dare I say, green tape—legislation and over-burdensome regulatory laws that are in power. That is what this legislation is doing. I urge the Labor Party to get on board with us and help this country.
The Treasury Legislation Amendment (Repeal Day 2015) Bill 2015 is particularly important legislation because it really goes to the heart of what government is about. What government is about is legislating where required but only where required, and never for the sake of legislation for its own sake or for government to seek to impose itself unnecessarily upon the people. We have a very clear view on this: only pass that legislation which is genuinely required, and if there is legislation on the books which is unproductive and which serves no purpose—which indeed in many cases is counterproductive—then get rid of it. Why would we want bad laws hanging around on the statute books?
It is interesting to contrast our approach on this with that of those opposite. There are some quite interesting statements on this issue of the volume of legislation and so on made by those opposite when they were in the previous government. It is almost as if those opposite think that legislating is a task of quantity, not quality—that, if you weigh the pages on the scales and there are plenty of laws, lots of schedules and regulations and so on, that means government is functioning effectively. That is absolutely not the case.
It was in fact the member for Grayndler who excitedly declared in the last parliament, 'We've now passed 307 pieces of legislation through the House of Representatives.' There was no reference to the specific quality of that legislation or, indeed, what the legislation was. It was: 'There's a whole lot of legislation, and surely that must be a good thing.' His colleague and my neighbour, the member for Blaxland, in a similar vein, was very excited by the volume of legislation that had been passed by the parliament then, and he said, 'Despite all the negativity, this parliament has passed 482 pieces of legislation,' again as if in and of itself this was a good thing, and we know that is not the case.
In that six-year Labor government era, there were a litany of failures, some through managerial incompetence and some the direct consequence of legislation. But there was a lot of legislation. There were 975 acts and 39,000 pages of legislation during that period. That is a huge amount of legislation. But, again, you cannot just weigh it and say, 'There's a lot of legislation, so things are good.' You have to focus very much on the need for that legislation to be passed before doing so.
It is good to have the opportunity to reflect on this topic of red-tape reduction, which has some very small instances of application and some very big ones too. Much of the economic development of Australia and the rest of the Western world in recent decades could be put down, broadly, to the concept of red-tape reduction, because there was a massive amount of red tape imposed on economies, particularly around the middle of the 20th century, and the task of good governments in recent decades has often been simply to get rid of that bad legislation and those bad structures. We should give credit to the Hawke-Keating government, which did make some quite significant changes to the Australian economy and did get rid of quite a bit of red tape that was holding us back. We should celebrate that success and we should ask those opposite to rise to the challenge that their predecessors set for them. Hopefully, they will.
To me, one of the great examples of red-tape reduction and deregulation is free trade because, when you think about it, free trade basically involves the undoing of bad laws passed by governments over generations. The entire process of free trade is about undoing previous laws that imposed artificial barriers that increased costs for consumers and made economies poorer than they would otherwise have been. But for governments of all persuasions and, indeed, in many countries who passed laws for tariff and other forms of protection, particularly in the 20th century, we would not have to go through rounds of free trade negotiations—and our remarkable trade minister would be somewhat less busily employed than he is! But that is required, because we have to get rid of the barriers to trade which have hurt our world so much.
This government has had tremendous success in that area, having closed free trade deals with Japan and South Korea; being a party recently to the Trans-Pacific Partnership; and, perhaps most remarkably, having closed a free trade agreement with China, which will have a very positive impact on Australia for generations to come. That is an act of deregulation right there, because it is taking away artificial barriers and artificial regulations which governments have imposed in the past. That is an extremely important example.
Another example in recent times of red tape, of excessive regulation, that had to be removed for the benefit of the economy is in fact the action that the previous, Labor government took in floating the Australian dollar and having a flexible exchange rate. Fixed exchange rates are basically governments saying, 'We know better; we know how much our dollar's worth and we're going to do a whole lot of artificial things to get that outcome. Even if common sense says it's wrong and even if markets say that valuation is wrong, we're going to do it anyway.' When as a government you involve yourself in such activities, there are lots of negative consequences as a result, because a floating exchange rate is basically a teller of the truth. It is not what you might want it to be worth. It is not what you might decide in a committee meeting it is worth. It is what it is actually worth. And ensuring that an exchange rate adjusts to reflect the reality of what is happening in a particular economy is an important shock absorber. So that was a really important act of deregulation.
Another important area of deregulation, where red tape gets in the way, is where governments are involved in commercial type activities in the government sector, because government entities have different motivations from commercial entities; they also, frankly, have unfair advantages over commercial entities with whom they compete. History shows us very clearly that it does not make sense for governments to participate in the commercial world and that they should seek to get out of those activities wherever they can sensibly do so
This government has done that through the privatisation of Medibank Private, amongst other activities, and that is absolutely appropriate because there is an inherent conflict in government entities competing with commercial ones. There is a practical example that we see from time to time in the media industry, where the ABC, which does a great job in many respects, is effectively competing with commercial entities providing similar services to the same markets—same time, same place. That creates complexities and significant problems in the commercial media sector. We need to be conscious of making sure that government entities act where they should and not where they should not. One of the places where they should be very hesitant to act is anything which is, in any way, commercial. The good news is, under successive governments over a number of decades, that is the direction in which this nation has been moving, and that has been good for productivity, economic growth and jobs.
They are some of the broader areas of deregulation and red-tape reduction, but we should turn to some of the specific provisions of today's legislation, which has been introduced by the Assistant Minister for Productivity, standing in the shoes, as he now does, of those who went before him: the Minister for Resources, Energy and Northern Australia, and the Minister for Social Services.
One of the first important changes relates to the superannuation guarantee charge. This is a longstanding provision that basically charges a penalty fee on employers who are, perhaps, somewhat slow in making superannuation payments. This was an important piece of legislation back when the superannuation system was first introduced, but, as we have become more cognisant of the importance of superannuation, as this area has become just part of daily life in Australia, these provisions are largely redundant. They tend to overly penalise honest mistakes. The key point is that the employee must be paid, and, as long as that occurs, it is sensible to not take an overly punitive approach in administering this area of the law. That is what this bill will do. It will make the superannuation guarantee charge more proportionate to the noncompliance by aligning the interest component that is paid with the relevant period for which contributions were not paid. Currently, it is a more punitive definition. So that is an important change that is part of today's red-tape repeal bill.
Another area which the assistant minister and others have commented on in recent weeks is the important change about lost and unclaimed superannuation, especially as it pertains to people with a terminal medical condition. In the very sad situation where someone has a terminal medical condition, it is really important that their assets can be transferred for their direct use as soon as possible so as to assist with their care and all of the other expenses that they or their family may incur. Prior to this legislation coming before the House, it was necessary for there to be a step where the ATO-administered amounts were paid directly to a super fund and then the super fund itself had to make arrangements to pay the individual the amount of money. As you can imagine, that could take some time and could cause delays and, frankly, a lot of unhelpful frustration in what is a very difficult time for the person involved. So these changes will mean there will be no need for those funds to go to the superannuation fund in the first instance. They can go directly to the person who is terminally ill, and that is a really important and common-sense change.
Schedule 3 of the bill will also make some changes to the description of a company as being in receivership. For various technical reasons that I will not go into great detail about, there are currently situations where a corporation is required to use the notification in receivership in a broad sense, even when the assets or activities in receivership may, in fact, be a minute proportion of their activities. This bill will fix that particular problem.
We are about removing unnecessary regulation, focusing on common sense and, above all, not valuing legislation by its volume but by its quality. That is what government is about.
I am most pleased to rise tonight to speak on the Treasury Legislation Amendment (Repeal Day 2015) Bill 2015. Back in 2013, when the coalition was going to the election, we said that there was far too much red tape and government regulation holding back business. We made a commitment that we would bring in steps and measures that would reduce the red-tape costs to business by $1 billion and would help our nation's competitiveness. We have achieved that and more. We have now been able to announce total savings from the reduction of unnecessary government regulation of $2.45 billion in just two years. This is an important contribution to our economy. Nowhere in those measures do we see businesses, the entrepreneurs of this country, being held back by government red tape and regulation.
The specific provisions for repeal in this bill relate to superannuation. I thought this was a good opportunity to raise a few issues about our superannuation industry and the superannuation structure going forward. The point that needs to be made is that superannuation is money which is earned by an individual and which belongs to an individual. Too many times do we see those on the other side of the House thinking that superannuation is some slush fund to be created for a union delegate or a union member so that they can get onto a board to regulate the fund. Too many times do we see those on that side of the House thinking that it should be regulated where an individual can choose to put their superannuation money.
My first concern is that by forcing an individual to put a proportion of their savings into a superannuation fund has two detrimental effects. The first detrimental effect is where an individual wants to start up their own small business. This is an individual who wants to work to earn a bit of capital, to get a bit of equity and then to use that to invest in order to build themselves up, to have a go, to think that they could be an entrepreneur and try their luck rather than just being a unionised employee. If we force an average Australian to take 10 per cent or up to 15 per cent—if they are in the Public Service—of their money and, instead of them being able to put that money in a little pot to start up their own small business, we force them to put it into some fund that they cannot touch and that is loaned out to other groups, it will have a detrimental effect on the entrepreneurial spirit, the entrepreneurial drive, and the availability of capital for small businesses in the entrepreneurial sector.
My second concern is that superannuation savings affect the ability of younger people to enter the housing market. When I was younger we did not have this superannuation set-up. When I first started work I was able to put what was the equivalent of 10 per cent of my income into a special account to save up for a deposit on a house. It is something that most of the people of my generation were able to do successfully. The savings that we had were simply for a deposit for our house, which then enabled us to get our foot in the door of the real estate market. It helped us to pay off our house and it gave us enormous equity as we went ahead. By forcing the young people of today to put 10 per cent or 9.5 per cent—if they are in the private sector—of their salary into a superannuation fund, which they cannot touch, and then expecting them to try and save money on top of that to create a deposit for a house, we are making it harder and harder for young people to enter the housing market. If we do that, we risk changing the nature of our society. The greatest Liberal of all time, Sir Robert Menzies, noted this in his famous speech when he talked about the importance of home ownership—where you are able to say that a part of this world is your own, that this is your own piece of Australia. The effect that has on our society can never be underestimated. But we are saying to today's young generation: 'Sorry. You've got to put the money that the previous generation was able to use to save for a deposit into some superannuation fund that you cannot touch until you are in your sixties or of retirement age.' This simply denies many young Australians the ability to get into the market.
One of the things that we know about unnecessary regulation—and we see many examples of this—is where the government rushes in, thinking it is going to fix a problem by putting out a regulation that only causes more problems. A classic example that occurred recently was the shortage of baby milk formula. I know there is nothing more distressing than hungry babies, and their mothers who are unable to buy formula. It is not a situation that we like to see. Of course, it causes great distress if a mother goes to buy baby milk formula, powdered milk formula, in a supermarket and cannot find it, and they go to another supermarket and still cannot find it. Yes, that causes great distress. It would have been easy for the government to jump in and say, 'We can fix this problem with regulation', but doing so would have only caused more problems. The only way to fix this problem is to get entrepreneurs to produce more. We can produce more baby milk formula. We heard the story today about a new baby milk formula plant that is under construction in the member for Macarthur's electorate. It will be opening very soon.
Anything we do to discourage the increase in new production facilities coming online is detrimental. This is so even when putting up a sign in a shop that enforces some regulation—for example, when you say that the purchase of a product is 'limited to two' or 'limited to four'. It does not stop the person who wants to buy 10 or 20, because they just make multiple trips to the supermarket or send a couple of people in to do multiple trips. So you are not actually stopping the person who is buying 20 or more cans. What you are doing when you say that a product is 'limited to two' or 'limited to four' is sending the message to the average punter that there must be some shortage, and so where they would normally buy one, they might buy two or more. You are doubling the demand artificially. You are bringing forward the demand. You are creating a bubble in the demand for the product, which makes the problem worse. We had some restrictions on the export of baby milk formula through some government regulation, which again risked making the problem worse. We want entrepreneurs to be confident that, if they can set up production, they can sell as much to whoever wants to buy it.
The other area where we are see bad laws in this country is where there is poor or faulty information and we make a regulation. We rush to make laws simply because we mistook the problem. A classic example of that was revealed today in question time, when the foreign minister said:
I really do question the Deputy Leader of the Opposition seeking to make something of what is a public announcement …
… … …
I think it is important not to engage in hyperbole when one is talking about climate change. I remember in 2011 when the deputy leader tried to scare the senior citizens on the Central Coast by saying that they were going to be subject to the ravages of climate change. Well, this is rather interesting. On 4 November, in relation to climate change, the Deputy Leader of the Opposition said on ABC radio that she had visited the Pacific islands:
… to see, well, where an island used to be, the island of Eneko—an island that had a home on it, a garden, spread fruit trees, palm trees, it's just literally disappeared into the sea.
She said, 'literally disappeared into the sea'. That was news to me. That was certainly news to the post. That was certainly news to the residents of Eneko. Colleagues might be interested to see the island of Eneko.
I went back and thought I would see what is actually on this island of Eneko. Today, there is a place on the island called Eneko Island Getaway, and I will quote from their brochure—and this is an island that is supposed to have disappeared into the sea.
Mr Husic interjecting—
Our paradise island is perfect for beach goers, picnickers, divers, honeymooners, or holidaymakers that want to get off the main island.
… … …
The addition of the bungalows make it a popular short stay location for those wanting to get away from the downtown area.
… … …
There is however a choice of outdoor and indoor areas to both cook and eat whatever you take with you or catch from the sea.
Eneko Island … is around 10 km or 40 minutes by boat from downtown Majuro.
It goes on to say that the island is well equipped:
… and the picnic area can become quite busy! We have traditional style, well-equipped bungalows that are spacious and full of all the necessary amenities.
That does not sound like something that has collapsed under the sea. I will take the interjection from the member for Chifley. The shadow foreign minister did correct it. She said that, no, she was talking about another island. There was some other island that has disappeared under the sea recently.
What is the sea level rise that has happened in the Marshall Islands? I thought I would look at the science. I went to no less an authority than the Australian Bureau of Meteorology. I went to the website where they have the tide gauges for the maximum, the mean and the minimum for the Marshall Islands going back to 1992. I looked at the chart and I scratched my head because it did not show any sea level rise whatsoever. In fact, it showed that the sea level in the Marshall Islands today is lower than it was 20 years ago. This is the data from the Australian Bureau of Meteorology. So if the sea level has actually fallen since 1994, I am very keen to see this island that has disappeared under the sea.
The foreign minister got up in one of the most farcical scenes I have ever seen in parliament and, if I am correct, held up a picture of the ocean and said, 'Look! It's disappeared! It's disappeared!' as proof that it had actually disappeared. You could prove the lost city of Atlantis had never existed by holding up a picture of somewhere in the Atlantic Ocean and saying, 'Look, it used to be here.' But it is mistakes such as these by people who do not do their homework, who do not do their research, that lead to bad policy making and wasted government resources.
With the debt and the deficit that we have inherited as a result of the fickle and reckless expenditure and reckless policy of the Labor government, we are in a position in this country where we cannot afford these policy bungles and policy errors that Labor would make because they do not do their homework and they do not do their research. It is important that we repeal and continue to wind back unnecessary red tape and unnecessary regulation that is tying the hands of our entrepreneurs and is stopping them from getting out there and creating jobs. We also have to look at the evidence, look at the facts and look at the science when we are making policy so that we do not go off on a wild-goose chase, like the one we have seen from the shadow foreign minister, making outlandish statements and hyperbole and mistaking facts. That is how we would waste the taxpayers' money—and, as I said, we cannot afford to do that. With that, I commend the Treasury Legislation Amendment (Repeal Day 2015) Bill 2015 to the House.