Matt O'Sullivan (WA, Liberal Party) | Hansard source

I rise to speak on the Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2024. Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2024 seeks to expand the scope of the Anti-Money Laundering and Counter-Terrorism Financing Act of 2006. This was a Howard government initiative. The AML/CTF legislation was defined to defend against money-laundering and terrorism-financing schemes. This bill before the Senate will expand the scope of the AML/CTF regime to include a small range of small businesses, including lawyers, real estate agents and accountants. This reform will impact approximately 90,000 businesses nationwide and should not be taken lightly, despite the process, sadly, we've seen by this government here today.

Let me make this clear: the coalition supports efforts to combat money laundering. We always have. It was the coalition government that criminalised terrorist financing as part of the Criminal Code and moved money- laundering offences into the Criminal Code in 2002. It was the coalition government that first passed the AML/CTF Act in 2006. It was the coalition government that led Australia through its last mutual evaluation process in 2015. It was the coalition government that upgraded the AML/CTF Act in 2017 to implement the first suite of changes from that process. And it was the coalition government that once again upgraded the regime in 2020.

We understand and support the fight against money laundering, and we understand the costs. On this bill, the costs are, frankly, too high; they are damaging. This bill really needs to go back to the drawing board. Let me explain why this is the case. The committee's process for this bill has once again—like we've seen right throughout this term of parliament with this Albanese led government, and like we're seeing here in the Senate today—been rushed and inappropriately abbreviated, undermining the essential role of the Senate as the very important house of review. The Senate's primary function is to provide thorough scrutiny of proposed legislation, and all curtailing committee timeframes does is compromise the critical responsibility that we as senators have and, indeed, this Senate has. Unfortunately, abbreviated processes have become a recurring hallmark of bills introduced by this Attorney-General. While urgency can sometimes justify expedited processes, this bill addresses issues that have been under discussion for a considerable period, making the rushed timeline unnecessary and unjustified.

The reforms proposed in this bill are of immense importance—as underscored by the Attorney-General's impact analysis, which estimates the regulatory costs at a staggering $13.9 billion. That is $13.9 billion of regulatory costs that is going to be upon businesses across this country—most of whom will be small businesses, who will disproportionately carry the burden of this cost. Such a substantial financial burden should have prompted extended consultation and careful deliberation rather than a truncated process.

The coalition is particularly concerned about the increased compliance costs this bill will impose on small businesses across the country, many of whom are grappling with the challenges of the cost-of-living crisis. We're seeing this in my home state of Western Australia. Small businesses who make up over 90 per cent of the business community in Western Australia, carrying the big burden of employment opportunities for Western Australians, will be the ones that will carry the cost of this burden.

Government modelling predicts that regulatory costs will total $13.9 billion over the next decade. These costs are likely to be passed on to consumers, at a time when we have the cost of living out of control. We're seeing inflation start to moderate but the problem is the increased costs are baked in; Australians are carrying those forward. It's going to be some time, as the RBA and other economists have said, before wages, incomes and the profitability of businesses get to a place where they overcome the costs of doing business and the costs of everything in this country that have been incurred under this government. People are hurting, people are feeling the pressure and small businesses, no less, particularly those in my home state of Western Australia, are feeling the pressure.

The bill's effect will be felt most acutely by accountants, small law firms, real estate agents and other community based service providers throughout Australia. Regional areas in particular will face disproportionate challenges. Sole practitioners and small firms, which make up 93 per cent of law firms in this country, will be especially vulnerable. These firms, often situated in outer suburban and regional communities, play a vital role in providing accessible services. Many will be forced to close due to the additional financial pressures imposed by the bill. This will not only increase the costs for families seeking legal assistance but also reduce access to legal representation in these outer suburban, regional and remote areas, further disadvantaging these communities.

Once again, a bill that will impact the lives of so many Australians is being rammed through the Senate by this Albanese Labor government. Time and again, the government has shown nothing but contempt for Middle Australia. This is a government that hands out flyers claiming to assist with cost-of-living relief while it heaps $13.9 billion of costs onto Australian businesses. This is a government that claims to value co-designed policies and comprehensive public consultation while it attempts to sweep almost 40 bills through the Senate on one single sitting day—like we're dealing with today.

When we say that we take money laundering and terrorism financing seriously, the evidence, as I illustrated earlier, is on our side. We can point to both the enforcement actions undertaken on our watch and the existence of AML/CTF Act itself. We understand the importance of strong legislative and enforcement frameworks to combat money laundering and we fully support this fight.

Small businesses in your electorate will pay additional costs as a result of this bill. This is not just the coalition's perspective; this is actually what the government's own modelling says. We're talking about $13.9 billion of regulatory costs over 10 years. For those in the real estate sector, the Prime Minister's 'Merry Christmas' to you will be a $33,000 bill over the next year. That's incredible. Legal service small-business owners, you, too, are going to receive as a Christmas bonus—or Christmas pain, a bit of coal in your stocking—a $33,000 deficit. This is incredible. For Australians in accounting services, there's $33,000 in costs for your hard work.

The recent addition of the Australian Small Business and Family Enterprise Ombudsman Small Business Pulse reported:

High business expenses continue to put pressure on profit margins. These are widespread across supplies, labour and business essentials, particularly freight, insurance and finance.

Yet this government is again adding red tape and complexities for the small-business sector. How will this address declining productivity in this country? When you add on regulatory burden and red tape, does that do anything to assist with productivity? Of course it does not. This gets in the way of the profitability of businesses. It gets in the way of more people getting more jobs, and it gets in the way of people seeing even better pay rises.

Productivity has continued to be stagnant during the tenure of this government. The Business Council of Australia's recent report Australia's flagging competitiveness and productivity highlighted the threats posed by declining productivity and the damage it will do if it's not addressed:

Productivity is the primary factor which will define Australians' future quality of life. Simply put, there are 'no free lunches' and we must be able to produce more with what we have if we are to sustain growing wages and national prosperity

They went on to say:

If the opposite is true, however, higher wages can be afforded without fuelling inflated prices.

The Council of Small Business Organisations Australia, COSBOA, has criticised the Attorney-General for failing to follow best practice, stating that the bill 'leaves the door open to cost, confusion and compliance headaches for small businesses'. The Real Estate Institute of Australia highlighted concerns based on New Zealand's experience, where real estate agents faced additional costs ranging from $30,000 to $60,000 with no clear public benefit to justify these expenses. The Real Estate Institute of Queensland has expressed significant concerns that the legislation is overly complex, places a disproportionate burden on real estate agents and will increase transaction costs associated with buying a house.

The Law Council of Australia noted that the legal profession is already the most heavily regulated in the country. They warned that dual regulation of legal services continues to be a significant issue as increased regulatory costs inevitably drive up the costs of legal services. The Law Council also raised serious concerns about the impact on small law firms, which make up 92 to 93 per cent of all legal practices. Many of these firms are at risk of closure due to the increased regulatory costs, which will have a cascading effect on access to legal services, particularly in remote and regional areas of Australia.

This bill is more than just a revision for the AML/CTF regime. This is a message to small businesses in this country that the Albanese government is bad for small business and bad for all business. Heaping on $13.9 billion over the next decade while in the middle of a cost-of-living crisis—well, only this Labor government could do that. Rushing the consultation process and sweeping the bill through the Senate, along with 30 other bills, could only be done by this Labor government. They really ought to be thinking more about small businesses that need support in this country. Sadly, we're not seeing that from this government.