Mitch Fifield (Victoria, Liberal Party, Assistant Minister for Social Services) Share this | Link to this | Hansard source

I move:

That these bills be now read a second time.

I seek leave to have the second reading speeches incorporated in Hansard.

Leave granted.

The speeches read as follows—

CRIMES LEGISLATION AMENDMENT (PENALTY UNIT) BILL 2015

The Crimes Legislation Amendment (Penalty Unit) Bill 2015 will ensure that the penalties imposed under Commonwealth legislation remain effective deterrents of crime to make our communities safer.

Penalty units are used to set the maximum fines which can be imposed for Commonwealth criminal offences, as well as those in Territory ordinances. Commonwealth penalties are generally expressed in terms of penalty units rather than specific values to allow penalties across the statute book to be easily updated.

The bill will increase the amount of the Commonwealth penalty unit from $170 to $180, and will provide a mechanism for the amount to be indexed every three years according to the Consumer Price Index (CPI). These measures will apply to all offences across the Commonwealth statute book.

Maintaining the value of the penalty unit over time is necessary to ensure that financial penalties for Commonwealth offences keep pace with inflation and continue to remain an effective deterrent to unlawful behaviour.

This bill gives effect to a measure in the 2015-16 Budget. The increase in the penalty unit amount will take effect from 31 July 2015. The first indexation of the amount based on inflation will occur on 1 July 2018, and then again every three years following that.

The increase to the penalty unit amount will strengthen financial penalties for all Commonwealth offences, including those related to white-collar crime and serious and organised crime.

Strong financial penalties are important for deterring unlawful behaviour and making Australia a hostile environment for serious organised crime.

This Government places a high priority on tackling crime and keeping our community safe.

The Crimes Legislation Amendment (Penalty Unit) Bill 2015 will further our efforts to do this, by ensuring that our financial penalties remain an effective deterrent to criminal behaviour.

SECOND READING SPEECH

Private Health Insurance (National Joint Replacement Register Levy) Amendment Bill 2015

The Private Health Insurance (National Joint Replacement Register Levy) Amendment Bill implements the Government's Budget measure to amend the cost recovery arrangements for the National Joint Replacement Registry (the NJRR) to a utilisation based calculation.

The Commonwealth has funded the NJRR since its initial development in 1998. The NJRR collects demographic data related to joint replacement surgery in Australia and monitors the performance of all joint replacement prostheses used in Australia by collecting information on all joint replacement surgeries, including revisions , complications and other outcomes from device use. This results in improved quality of care for patients receiving joint replacement surgery.

In fact, thanks to the NJRR, Australia was the first country in the world to recognise, and subsequently take regulatory action to remove, ASR Hip replacements from the market. This happened eight or nine months before anywhere else in the world. Members of the House may remember that the ASR Hip had extremely poor outcomes. As a result of this early evidence, fewer Australians were implanted with this dire device.

Since 2009 the NJRR has been funded on a cost recovery basis by a levy payable by manufacturers and distributors of those joint replacement prostheses listed in the Private Health Insurance (Prostheses) Rules. This ensures ongoing funding for the registry.

Under current arrangements, joint replacement prostheses manufacturers and distributors currently contribute to the cost recovered funding on a proportional basis. This is based on the number of different prostheses models they have available for sale compared with the total number of models available on the market. This methodology does not take into account utilisation or the revenue derived by a manufacturer or distributor from the sale of prostheses.

For example, under the current cost recovery arrangements, a joint replacement prostheses that is included in the Prostheses Rules, but has never been provided to a patient and never reported to the Joint Replacement Register will attract the same amount of levy as a prosthesis that generates a much higher volume of work because the prostheses is frequently provided to patients and reported to the register.

Over time, consultations with industry have indicated a strong preference for changes to the cost recovery arrangements of the National Joint Replacement Register, to determine individual companies' contributions using a utilisation based calculation. This bill allows for the implementation of that change.

Under the changes proposed in this bill, the NJRR levy will now be collected by taking into account the number of times a joint replacement prosthesis is recorded on the NJRR in a particular period.

Importantly, the current rules set a maximum levy of $5,000 for sponsorship of any one joint replacement prosthesis in any one financial year. The amendments made by this bill will similarly restrict the maximum amount of levy that a sponsor may pay for any individual joint replacement prosthesis to $5,000.

These changes will mean that over 85 per cent of companies will now be paying smaller individual contributions, and will result in a more equitable distribution of the cost recovery across the industry.

The number of joint replacement surgeries taking place in Australia is increasing every year, and these changes to the cost recovery arrangements will ensure that this important resource will continue to be available in the future.

Social Services Legislation Amendment (No. 2) Bill 2015

SECOND READING SPEECH

This bill will introduce three measures in the Social Services portfolio.

Firstly, the bill will amend the social security law to streamline the current income management programme under a two-year continuation.

Income management and the BasicsCard will continue for two additional years to maintain support for existing income management participants. The streamlining amendments made by this bill will enable more effective operation of the income management programme.

In particular, the bill provides for the abolition of certain incentive payments relating to income management, amends the operation of the vulnerable measure of income management, and makes minor streamlining amendments to remove ambiguities and improve the programme’s effectiveness.

The bill also makes amendments to reflect two measures relating to aged care, which were included in the 2014-15 Mid-Year Economic and Fiscal Outlook announcement.

From 1 July 2015, the bill will cease payment of residential care subsidy to residential aged care providers for holding a place for up to seven days before a care recipient enters care. This will ensure the subsidy is appropriately targeted to people actually receiving care.

Currently, this subsidy is paid to providers at a reduced rate of 30 per cent of the full residential care subsidy that will be payable once the care recipient enters care.

When the subsidy is ceased under this measure, the provider will not be able to recoup any lost residential care subsidy from the care recipient. However, the provider will still be able to charge the care recipient the standard resident contribution for the pre-entry period.

Lastly, the bill will reflect the Government’s decision to abolish the Aged Care Planning Advisory Committees as part of the Smaller Government initiative.

The Smaller Government reforms are reducing the size and complexity of government. They are eliminating duplication and waste, streamlining services and reducing the cost of government administration.

The Aged Care Planning Advisory Committees’ role was to provide advice in relation to the distribution of aged care places. However, the last of these committees expired in September 2014. These amendments repeal the now-redundant relevant provisions in the Aged Care Act 1997.

Superannuation Guarantee (Administration) Amendment Bill 2015

SECOND READING SPEECH

Today I introduce a bill to amend the Superannuation Guarantee Administration Act 1992 to simplify when a standard choice form—which allows an employee to nominate their chosen superannuation fund—has to be offered by an employer to an employee.

The Government's commitment to cut $1 billion a year in red and green tape will result in more efficient government and more productive businesses. To date this commitment has seen us remove $2.45b. But our conviction is to go further and tackle overreaching excessive and unnecessary compliance burdens. This bill is part of a package of measures that will further contribute to exceeding progress by reducing the superannuation compliance costs for employers.

These changes play an important role in further delivering on this conviction of reducing red tape, particularly for small businesses.

Small businesses play an important role in the economy. Around 97 per cent of businesses are small businesses (as of 30 June 2014—ABS). However, as they are small, often these businesses lack economies of scale. While a big business may have overall higher compliance costs, we need to remember that small businesses have fewer staff than big businesses and often have less expertise dealing with complex regulation.

For example, a big business may have a number of expert staff performing specialised functions, whereas small business owners may be responsible for not only the core business but all the general administrative tasks that go along with running a business, such as managing the accounts, the payroll and superannuation. These tasks are important but the time a small business has to spend managing these tasks can take a small business away from the key task of running their business and become a barrier to employing more staff.

Reducing red tape and making life easier for these businesses to comply with the superannuation guarantee regime is a vital step in encouraging these businesses to grow.

Businesses that do not meet their superannuation guarantee obligations risk harsh penalties so it is important that we make it as easy as possible for all employers to pay their workers' superannuation on time.

In January 2014, we made a public commitment to the Australian people that the Government would make life easier for small business by reducing their superannuation compliance burden.

Part of this commitment was to move the government operated small business superannuation clearing house to the Australian Taxation Office.

The clearing house is a free online service that helps small businesses meet their superannuation guarantee obligations by allowing employers to pay superannuation contributions in one transaction to a single location to reduce red tape and compliance costs.

By moving the clearing house to the ATO we ensured this free service is within the agency that knows who is eligible for this free service. This means the ATO can help increase awareness of the benefits of the service to eligible businesses, this will in turn increase the take up rate of the clearing house.

We have already seen an increase in the number of small businesses registered to use the service since we moved it into the ATO. Between 1 April 2014 and 30 April 2015, around an additional 42,500 employers registered with the superannuation clearing house service. This brings the total number of employers registered to use the service to over 100,000 (as at 30 April 2015).

By increasing the use of the superannuation clearing house, we are also helping small businesses comply with SuperStream. Under the new SuperStream arrangements all superannuation contributions from employers must be made electronically from1 July 2016. Businesses who are registered with the superannuation clearing house will automatically meet their SuperStream obligations.

In January 2014, we also made a commitment to consult extensively on the drivers of superannuation compliance costs and develop options to reduce this burden on small businesses.

To help us meet this commitment, in 2014, the Treasury undertook two rounds of public consultation. This consultation explored these compliance costs and canvassed options to reduce the regulatory compliance burden. The changes in this bill were developed during this consultation process.

One of the changes this bill brings about is that employers will no longer have to provide a standard choice form to temporary residents. A standard choice form allows employees to nominate their superannuation fund. Generally employers have to give this form to employees within 28 days of the employee starting their job.

I would like to emphasise that the Government is not taking away the right of a temporary resident to choose a superannuation fund. What we are doing is simplifying the paperwork requirements for businesses that employ temporary residents such as those on a working holiday visa.

Under these changes, employers will no longer have to supply a standard choice form to temporary resident employees. It also means time poor small businesses will no longer have to spend time explaining how to complete the form.

This change will also make it easier for employers to pay their workers' superannuation on time.

As I have already mentioned, temporary residents will still be able to choose their superannuation fund if they wish to do so.

This change may be especially beneficial in industries that are reliant on large numbers of working holidaymakers to meet peak workloads, such as in the hospitality and agricultural sector.

The majority of businesses in these sectors are small businesses. Around 92 per cent of businesses in hospitality and 99 per cent of businesses in agriculture are small businesses (as of 30 June 2014 — ABS).

This means that although these changes will benefit all businesses, they will be of particular benefit to the many small businesses in those sectors that often employ people on working holiday visas for short term and intermittent work.

By removing these requirements employers will no longer risk incurring a choice shortfall penalty if they do not supply a standard choice form to temporary residents.

To make this change streamlined across all visa classes, we have also included New Zealand residents in the definition of a temporary resident even though these workers can generally stay indefinitely in Australia as Australia has a special relationship with New Zealand. We made the decision to include New Zealand residents in the measure as exempting New Zealand residents would have added complexity for time poor small businesses. By including New Zealand residents in this measure, employers won't have to keep track of whether or not an employee is from New Zealand when relying on this exemption to provide a standard choice form.

This bill also introduces a second change to the superannuation choice regime. Currently, when a superannuation fund mergers with another superannuation fund, there is an obligation on employers to reoffer a standard choice form to employees.

This obligation is an unreasonable burden on employers. It is also an obligation that many employers may not be aware of. Currently, employers may incur the choice shortfall penalty if they don't comply with this requirement. This bill removes this requirement on employers.

An employee whose superannuation fund has merged with another fund will continue to be notified of their new fund – this is a requirement under the Corporations law.

We are not limiting an employee's right to choose their fund. An employee's whose fund has merged with another fund will still be able to choose a different superannuation fund and rollover their money if they are dissatisfied with this new fund.

This bill balances the need to protect choice for employees while at the same time reducing red tape and making the superannuation guarantee regime easier to comply with.

Both of these changes to the superannuation guarantee regime will commence from 1 July 2015.

As I have mentioned before, this bill reduces the compliance costs of businesses, especially small businesses. These changes will result in around $45 million in annual compliance costs savings for business, which will help meet the Government's target to reduce red and green tape by $1 billion annually. These changes also complement other measures the Government is implementing to reduce the compliance costs for small business.

The Government will expand the eligibility of the government's superannuation clearing house service. From 1 July 2015, small businesses with a turnover under the small business entity threshold, which is currently $2 million, or that has less than 20 employees will be able to use this free online service to pay their workers' superannuation. Currently only businesses with fewer than 20 employees can use the service.

This change means around an additional 27,500 small businesses will be able to access to the clearing house from 1 July 2015. Expanding the clearing house also means businesses that exceed the current employee threshold by hiring temporary or casual staff to cover peak work periods, such as seasonal work, will still be able to access this service if their turnover is under $2 million.

Simplifying when a standard choice form has to be provided by an employer and expanding the clearing house is the first part of a package of reforms that the Government has announced to reduce superannuation red tape. The second phase of the reforms will be changes to reduce the harshness and simplify the superannuation guarantee charge. The changes to the superannuation guarantee charge will commence from 1 July 2106.

The full details of the amendments are contained in the explanatory memorandum.

Debate adjourned.

Ordered that the bills be listed on the Notice Paper as separate orders of the day.