Mr FRYDENBERG (Kooyong—The Treasurer) (09:32): I move:

That this bill be now read a second time.

This bill introduced today will establish the $2 billion Australian Business Securitisation Fund (the fund). This fund will enhance access to debt finance for Australian small and medium businesses by improving smaller bank and non-bank business lenders' access to the Australian securitisation market.

Small and medium businesses, or SMEs, are at the heart of the Australian economy. Nearly 70 per cent of private sector employment is generated by small and medium enterprises. Creating the conditions that allow these small businesses to grow and thrive is critical to the prosperity of Australia.

One of the largest barriers these businesses face is accessing the affordable finance needed to support and grow their businesses. Many business owners cannot access finance without putting their home up as collateral and struggle to gain additional finance to grow once all of their real estate has been pledged. For those who can access finance, the interest rates charged are often high and the process of applying for finance is long and onerous.

A major underlying factor in the difficulties some firms face in accessing funds is the lack of competition in the market. Eighty per cent of small and medium enterprise lending is held by the major banks. There are a number of non-banks and smaller banks entering the SME market and targeting underserviced segments, but many of these lenders are constrained by their ability to access funding on competitive terms.

This bill seeks to increase competition in the SME lending market by unlocking securitisation funding for smaller lenders, which will allow them to compete more effectively against the major banks.

Securitisation is a method of funding whereby the cash flows from illiquid assets, such as loans, are packaged into tradeable debt securities that are generally tranched, with each tranche having different risk characteristics. The cash flows from the underlying loans are used to make interest and principal payments to investors in the securities. These securities often only have recourse to the underlying assets, with generally no recourse to the originator of the assets. Securitisation may be undertaken on a warehouse or term basis. Warehouses are securitisation facilities that allow a lender to fund loans until they have built up a large enough pool and track record to refinance them into the term securitisation markets.

Australia has a well-developed securitisation market for residential mortgages, which provides funding for a significant number of smaller bank and non-bank lenders. The securitisation market provides smaller lenders with access to new investors and a potentially cheaper source of domestic debt funding to enable them to compete with the major banks. The development of the residential mortgage backed securitisation market since the mid-nineties has significantly increased competition and lowered interest rates in the mortgage market.

The securitisation market for SME loans is currently very small, consisting of only a handful of deals a year. The SME securitisation market is constrained by a self-perpetuating lack of scale; low issuance means that potential investors are unwilling to undertake the due diligence needed to enter the market. However, the lack of investor interest constrains the issuance of new deals.

The fund will help break this cycle by stepping in as a patient investor that is willing to do due diligence despite the small scale of the market. This would accelerate the development of the securitisation market which would unlock a new sustainable funding source for smaller lenders.

The fund will allow these smaller lenders to compete more effectively in the SME lending market, which should improve borrowing conditions for the SMEs in the medium to long term. The fund builds on other government measures to improve small business access to finance, including supporting the creation of a private sector owned Australian Business Growth Fund and reforms such as open banking and comprehensive credit reporting.

Now to the provisions of the bill.

The bill will establish the fund and the fund's special account. The bill will credit $2 billion in increments into the special account between 1 July 2019 and 1 July 2023. Any proceeds of the fund will be returned to the special account, unless otherwise directed by the Treasurer.

The minister will be able to invest the moneys of the fund in eligible debt securities, namely Australian dollar denominated debt securities which are issued by a trust or special purpose vehicle. These eligibility requirements reflect standard securitisation market deal structures. These securities must be backed by SME loans, which are defined as business loans with a principal value of less than $5 million.

The bill provides the minister with the power to delegate certain powers to certain officials within the Department of the Treasury. Consistent with the government's public announcements, administration of the fund will be delegated to officials of the Australian Office of Financial Management (AOFM) within the Treasury.

The bill also provides the minister with the power to issue directions about the exercise of the minister's investment powers and to make rules. It is intended that the minister would issue an investment mandate that establishes more detailed rules for the fund, including further eligibility requirements, considerations the AOFM must take into account when selecting securities to invest in, financial performance requirements, risk management and transparency obligations.

The government has consulted on key features of the investment mandate and rules and will shortly release the proposed final versions of these instruments.

Finally, the bill includes provisions to ensure there is reporting of the activities and outcomes of the fund. Reviews of the fund will be undertaken two and five years after its establishment to consider its effectiveness in meeting the objectives set out in the bill. The reviews must be tabled within 15 sitting days of being provided to the minister. The bill also requires annual reporting on the operations of the fund.

Full details of the measure are contained in the explanatory memorandum.

Debate adjourned.

Mr FRYDENBERG (Kooyong—The Treasurer) (09:39): I move:

That this bill be now read a second time.

This bill will amend the Competition and Consumer Act 2010, the Privacy Act 1988, and the Australian Information Commissioner Act 2010 to introduce a consumer data right and open banking.

Australia's data revolution begins today. With this bill, Australia becomes a world leader in implementing an economy-wide right for consumers to access and use data that businesses hold about them.

This important reform will provide individuals and businesses with a right to access data relating to them and to authorise secure access to their data by accredited data recipients. It will also enable data about products on offer to be available in machine-readable form.

The consumer data right is a right for consumers to authorise data sharing and use. Consumers will determine which data is shared under the right, on what terms and with whom.

The consumer data right is a game changer for consumers and small businesses. It will enable consumers to better harness their data for their own benefit. The consumer data right is a fundamental structural reform that will drive competition and improve the flow of information around the Australian economy.

And the right will incentivise Australian entrepreneurs to develop new products and applications that reach more consumers and are better tailored to their needs.

For consumers, improved access to data will support better price comparison services, taking into account their unique circumstances, and promote more convenient switching between products and providers. It will also leverage new technology such as artificial intelligence and allow consumers to make more informed decisions on where they spend their money.

For small and medium businesses, it will allow for more effective budgeting tools that can deal with data in real time and help them manage their cash flow and working capital more effectively than they can do today.

Improved access to data will also enable the development of new, better and more convenient products and services, many customised to individual needs.

We live in a world of increasing complexity. Many consumers need assistance in understanding the choices open to them and how best to navigate the sheer volume of choices presented to them—choices that may not be presented in a way that allows them to make effective comparisons.

For example, the recent Productivity Commission review on competition in the Australian financial system reported that the average Australian household could be saving up to $1,000 per year on their home loan if they switched to another lender—but many do not. With over 4,000 different residential property loans on offer, it's no wonder that customers struggle to determine which home loan is best for them.

The consumer data right provides efficient and convenient access to accurate information and empowers third parties to develop tools that will allow consumers to make the most of the choices available to them.

These tools are likely to include comparison sites that take into account the actual ways the consumer uses the product; budgeting apps that analyse actual spending behaviours and services that assess the expected return for a household that is considering the installation of rooftop solar panels, taking into account their actual electricity usage.

By doing so, the consumer data right will increase competition and drive consumer focused innovation.

Today, we are laying the tracks for Australia's future data economy.

The consumer data right will support data-driven innovation across the economy. New high-value jobs will be created by positioning Australia at the global forefront of data access and innovation.

By introducing this bill today, we are implementing commitments made by the government in its response to its review into open banking in Australiaand to theProductivity Commission's data availability and use inquiry.

The government has committed to applying the consumer data right to banking—where it is referred to as open banking—then to the energy and telecommunications sectors, and in due course more widely across the economy.

This bill establishes a broader framework that can apply across all sectors to ensure that the data can be transferred in a safe and secure way, while retaining the flexibility to recognise that data access arrangements must be able to adapt to different sectors, different datasets, different risks, different customers' needs and changing technologies.

This bill allows for the growth and evolution of the consumer data right by allowing new datasets to be added over time.

When deciding whether to add new sectors or datasets as being subject to the consumer data right, the minister will be required to seek the public advice of both the ACCC and the Information Commissioner. The minister must consider a range of factors prior to adding a sector, including the impact on consumers, competition, data-driven innovation, privacy and confidentiality, and whether the data may contain intellectual property.

The bill also creates a rules and technical standards framework that recognises the need to allow for flexibility in implementation over time as technology adapts, and between sectors that have different risks and differing levels of technological capability.

Nevertheless, implementation between sectors should be as consistent and interoperable as possible. Consistency and interoperability will facilitate the growth of a vibrant data ecosystem and ensure consumers are able to navigate easily the emerging data economy as active participants.

Strong privacy and information security provisions are a fundamental design feature of the consumer data right. These protections include privacy safeguards and additional privacy protections through the consumer data rules. The Office of the Australian Information Commissioner will advise on and enforce privacy protections, and provide complaint handling for breaches of the privacy safeguards. Consumers will have a range of avenues to seek remedies for breaches of their privacy or confidentiality including access to internal and external dispute resolution and direct rights of action.

Only trusted and accredited third parties will be able to access data from data holders at the customer's direction. Accreditation can be considered to be a 'data safety licence'. Accreditation will contribute to the justified confidence that consumers can have that the system supports safety and security for their data.

The ACCC will be the primary regulator of the consumer data right. In addition to advising what sectors should be added and writing rules, the ACCC will be responsible for accrediting new participants, overseeing a new data standards body, and enforcing serious and systemic breaches of consumers' rights.

Complementing the rules, technical standards turn what is a right in principle into real action. The data standards chair, advised by the data standards body, will be responsible for working with businesses, consumers and innovators to ensure that the right is implemented in a way that promotes efficiency, convenience and safety. Consistent standards will support access to data that is usable and reduce the barriers to service providers offering new services to consumers.

The bill also contains a statutory review provision, with a review to be completed by 1 January 2022. This review will provide an opportunity for the government to confirm that the system is operating as intended; and to consider the impacts of the system on consumers and industry.

I would like to thank the active and ongoing engagement by industry, consumer and privacy groups, and fin-techs in the development of this bill. I also thank them for their ongoing engagement in the Productivity Commission's inquiry and the open banking review and in the development of rules by the ACCC and standards by Data61.

This bill will provide all Australians with a new right to access their data and use it in a way that they have never been able to do before. We live at a time of unparalleled technological advances. The consumer data right will allow Australia to fully leverage these advances.

Full details of the measure are contained in the explanatory memorandum.

Debate adjourned.

Ms O'DWYER (Higgins—Minister for Women and Minister for Jobs and Industrial Relations) (09:50): I move:

That this bill be now read a second time.

The Fair Work Amendment (Right to Casual Conversion) Bill 2019 amends the Fair Work Act 2009to insert into the National Employment Standards a new right for eligible employees to request to convert to full-time or part-time employment.

This means that, if they want to, all eligible employees will be able to ask their employer to move from casual employment to full-time or part-time employment.

This is necessary because there are currently a significant number of employees in the national system who do not have such a right. This bill will fill that gap.

It is only fair that a right to request casual conversion is extended to all eligible employees.

The new right in the bill is in line with a model casual conversion clause that was developed by the Fair Work Commission.

On 5 July 2017, the Fair Work Commission determined that a model casual conversion clause should be inserted into 85 modern awards that did not contain such a right. This took effect in 85 awards on 1 October last year.

The Fair Work Commission made this decision after considering the evidence provided by employee and employer representatives in extensive proceedings over a period of four years.

However, the Fair Work Commission's decision only affects employees whose terms and conditions of employment are set by one of those 85 awards.

Another 27 modern awards already contain casual conversion clauses, specifically tailored by the commission to respond to the needs of each of those particular industries.

For example, in the manufacturing and construction industries, the right to request casual conversion in the relevant modern awards has been a longstanding feature in those industries.

The government, with this bill, does not seek to disturb these arrangements.

However, it currently remains the case that a significant number of employees in the national system do not have access to a protected right to request to convert to full-time or part-time employment.

The government's bill will fill this gap and ensure that a right to request conversion will be available to:

employees who are covered by a modern award that does not contain a right to request casual conversion;

employees to whom an enterprise agreement applies and who are either covered by a modern award that does not contain a right to request conversion or not covered by a modern award at all; and

employees who are award and agreement free.

In this way, the bill will ensure that all employees in the Fair Work system will have access to a protected right to request casual conversion, irrespective of whether their terms and conditions are set by a modern award, an enterprise agreement or any other arrangement.

No-one falls through the cracks.

The bill will also have the effect of ensuring that employees to whom an enterprise agreement applies and who are covered by a modern award that contains a casual conversion clause will get the benefit of that award clause.

Enterprise agreements will not be able to trade away these casual conversion terms, which must be derived from an underlying modern award with such a term for that particular industry, or in other cases, where there is no underlying award with such a term, the new right in the National Employment Standards.

Importantly, this bill will not mandate that any particular employee will have to convert to full-time or part-time employment.

We know that casual employment is a genuine and fulfilling choice for many people. Working as a casual enables people to balance work with other priorities. This includes allowing flexibility for those with caring responsibilities for children, parents or those with disabilities, helping mature-age people to stay in work while transitioning to retirement, and enabling students to have a job while studying.

In this country, casual employees are entitled to a higher hourly pay rate than equivalent full-time or part-time employees in place of annual leave and other entitlements. They usually get a 25 per cent loading.

Casual employment is also important for employers, particularly small business. They need flexibility to manage their workforce to better compete in the market and manage peaks, troughs, and seasonality in their business. For example, they may need flexibility to put on extra staff during busy times, such as holiday periods or at harvest time.

Casual work is often temporary and can be a stepping stone to other jobs. Almost three-quarters of workers who enter casual work leave within two years. And over half move to full- or part-time jobs.

As noted in the Fair Work Commission's decision, the needs of employers and employees can change over time. It is necessary for casual employees who have worked regular hours over extended periods to have a pathway to convert to full-time or part-time employment.

The bill is in line with the Fair Work Commission's model casual conversion clause to the greatest extent possible.

The bill will provide eligible employees who have worked a regular pattern of hours for the previous 12 months with the right to request that their employment be converted to full-time or part-time employment, under certain circumstances.

Employers will only be able to refuse a request from an eligible employee on known or foreseeable reasonable grounds.

This bill provides all employees in the national system with access to a dispute resolution mechanism to resolve any disputes that may arise between the employee and their employer about the operation of the new National Employment Standards right. The bill does not intend to disturb existing dispute resolution procedures in industrial instruments, employment contracts or other agreements.

As already stated, the bill will not disturb existing industry-specific standards in modern awards from operating as a minimum safety net.

Where awards that contain a casual conversion clause apply to employers and employees, there will be no change for them.

Where enterprise agreements are in place, those agreements must provide a right to request casual conversion that is the same as or better than any casual conversion clause in the relevant modern awards.

This government is committed to fairness and balance in Australia's industrial relations system, where people find reward and value in their work, and business can thrive and create jobs.

The government is fulfilling its responsibility to ensure that all employees have access to a minimum entitlement of a right to request casual conversion, and all businesses, big and small, have clarity on their obligations in making workforce planning decisions.

Importantly, for small businesses, the majority of which employ their staff under a modern award, this bill will not create significant new obligations.

Including casual conversion in the National Employment Standards will also increase awareness of this entitlement. Employers are required to give all new employees a copy of the Fair Work Information Statement. Under the bill, all current potentially eligible casual employees will also be informed by their employer of this new entitlement.

This bill is the right result for Australian workers, Australian business and the Australian economy. I commend the bill to the House.

Debate adjourned.

Mr FLETCHER (Bradfield—Minister for Families and Social Services) (09:59): I move:

That this bill be now read a second time.

The cashless debit card is working.

An independent evaluation of the cashless debit card found a 'considerable positive impact' in the initial trial sites, including:

41 per cent of participants surveyed who drank alcohol reported drinking less frequently;

48 per cent of participants surveyed who used drugs reported using drugs less frequently; and

48 per cent of those who gambled before the trial reported gambling less often; and

A doubling of the proportion of participants trying to get paid work.

And I've heard firsthand from leaders across all four trial sites—Ceduna, the East Kimberley and the Goldfields, and most recently, Bundaberg and Hervey Bay—about the positive impacts they're seeing and expect to see in their communities, from a reduction in drug and alcohol related presentation in the emergency wards and less police call-outs late at night through to a general feeling of improved safety on the streets of these towns.

I've heard directly from business leaders, from local Indigenous leaders, from elected members, from police and from health officials, and there is a consistent message—'The card must stay.'

Feedback from local communities has informed every aspect of how the cashless debit card will operate in their communities, from the percentage of welfare to be quarantined right down to the colour of the card.

This is a community-driven, bottom-up approach to tackling the scourge of welfare-funded drug and alcohol abuse.

Technicalities of the b ill

The cashless debit card has been in operation for almost three years in Ceduna in South Australia and Kununurra and Wyndham in the East Kimberley in Western Australia. It's been operating in the Goldfields region in Western Australia for almost a year.

This bill will allow the cashless debit card to remain in place for a further 12 months until 30 June 2020 in the first three trial sites of Ceduna, the East Kimberley and the Goldfields under the Social Security (Administration) Act 1999.

This will align the legislated review date for the first three sites to that of the newest trial site, the Bundaberg and Hervey Bay region, which is already legislated to continue until 30 June 2020.

This bill gives these communities further confidence about the government's commitment to reducing the devastating effects of alcohol, drugs and gambling in these communities.

CDC justification

Welfare payments are provided to people in need to help with essential living costs, in particular food, clothing, shelter and transportation. Australians expect that these payments will be used for these purposes rather than on harmful goods such as alcohol, gambling and drugs.

In these three trial sites, everyone on a working-age welfare payment is a trial participant. Eighty per cent of their welfare payments are placed into a separate account which is accessible only by using their cashless debit card. The remaining 20 per cent is placed into their regular bank account.

The card operates like any other ordinary debit card, with the primary difference being that it does not work at liquor stores or locations where people can gamble—be they online or physical locations. Further, the card cannot be used to withdraw cash or purchase cash-like products.

Importantly, these amendments do not change any of the current parameters for the cashless debit card program; nor do they change a person's entitlement to welfare or how much they receive.

The only real difference concerns how a person can dispose of their welfare benefit—that is, they cannot spend on alcohol, drugs or gambling the 80 per cent benefit which is paid on the card.

Evidence

According to the first evaluation, the cashless debit card has been effective in reducing alcohol consumption and gambling in both trial sites, and that evaluation also found that the participants who reported drug use before the trial were using illegal drugs less often.

In addition to activity underway to collect baseline data for the fourth site in Bundaberg and Hervey Bay, a second evaluation of the cashless debit card trial by the University of Adelaide has commenced across the first three sites to assess the ongoing effectiveness of the program.

Data collection for the second evaluation will be completed by mid-2019, with findings expected in late 2019. Funding has also been committed for a further wave of data collection in late 2019 through to early 2020, in line with the new end date of 30 June 2020 in this bill.

Extending the cashless debit card trial for a further year will provide sufficient time to continue evaluation of the trial in these three sites, incorporating initial baseline findings from the Goldfields site. This will build on the positive findings of the first evaluation report.

In accordance with amendments recently passed through parliament, the second evaluation will be subject to an independent review process.

Cape York income management

In addition to amending the sunset dates for the cashless debit card, this bill will allow the continuation of the Cape York income management measure, as part of Cape York welfare reform, for an additional year to 30 June 2020. This applies to the Cape York welfare reform communities of Aurukun, Coen, Hope Vale and Mossman Gorge.

The 2018-19 Mid-Year Economic and Fiscal Outlook extended income management for a further year in all current locations; however, income management in Cape York is the only income management measure with a legislated sunset date of 30 June 2019. Ceasing this program without a mechanism to replace it could place vulnerable people in Cape York, in particular women and children, at risk.

As recently noted in the Queensland University of Technology Review of Cape York Income Management, the role of the local Family Responsibilities Commission (FRC) in Cape York income management enables it to be delivered in a way that is more culturally appropriate, community driven, and is uniquely matched to the individual circumstances.

The review specifically found:

… there is good qualitative evidence that the Family Responsibilities Commission (FRC) and Cape York Income Management have contributed to a reduction in alcohol (and in particular, harmful consumption of alcohol), drugs, violence and crime. There is also evidence that outcomes have improved in terms of children's overall health and wellbeing, and engagement in school.

These findings present a strong case for this measure to be maintained.

This extension will give further certainty to these communities in Cape York about the government's commitment to ensure that income support payments are spent in the best interests of children and families, with an aim to reduce social harm and drive positive social change in the community.

Summing up

We must continue to support communities that put their hand up and drive positive change and improved outcomes for vulnerable individuals within those communities.

This bill does exactly that.

Building on the significant positive findings, and strong, ongoing community sentiment, this government considers the extension of the cashless debit card trial and the income management program essential to sustaining the positive impacts of welfare quarantining and supporting communities to tackle welfare fuelled dysfunction.

Debate adjourned.

Mr FLETCHER (Bradfield—Minister for Families and Social Services) (10:08): I move:

That this bill be now read a second time.

This bill implements a measure announced in the 2018-19 Mid-Year Economic and Fiscal Outlook to confirm that Australian pensions are only being paid to pensioners living overseas who are still alive.

Australia is a multicultural country, with around one-third of Australians born overseas and over half of Australians with at least one parent born overseas. The government recognises that many people wish to return to their country of birth or to be with family and friends at a later stage in life. Therefore, it is not unreasonable to expect a large number of Australian pensioners to retire overseas. In fact, Australia pays a pension to approximately 96,000 Australian pensioners who live overseas.

It is a longstanding policy of successive Australian governments to recognise that Australian pension recipients have contributed to Australia and are not required to remain in Australia to be eligible to receive a pension. Australia has international social security agreements with 31 countries that allow people who have lived part of their working life in Australia to claim an Australian pension while living overseas.

The effect of this bill is that, from 1 July 2019, pensioners aged 80 years and over and residing permanently overseas will need to complete and return a proof-of-life certificate to continue receiving their pension overseas. This will confirm that Australian pensions are only being paid to pensioners who are still alive.

The government estimates that approximately 24,900 pensioners who are aged 80 and over and live overseas will be required to provide proof of life. Limiting this process to pensioners aged 80 and over will minimise the administrative burden on pensioners, while helping to ensure that Australian pensions are only being paid to pensioners who are still alive.

This measure is expected to modify the behaviour of Australian pensioners and their families living overseas over time by reminding them of their reporting responsibilities. It is possible that there may be some misunderstanding by pensioners and their families overseas that Australian pensions may be bequeathed to or inherited by partners or family. Many overseas pension or national insurance schemes contain survivor or revisionary provisions that may be payable to partners or family. This is not, however, the case in respect of Australian pensions.

This misunderstanding can be compounded when a person is concurrently receiving pensions from Australia and from another country, and the other pension remains payable to a widow or widower under the laws of that other country. As overseas pensioners rarely contact the Australian government after leaving the country, the proof-of-life process will help to establish more regular contact with this group, and may lead to an increase in voluntary reporting.

The introduction of the proof-of-life process brings Australia in line with current international practice. Many other countries have regular assurance processes for people living overseas and receiving a pension from that country. For example, the United Kingdom, Germany, the Netherlands, France and Italy all have processes to verify that a pensioner living overseas is still alive, including a requirement to complete a proof-of-life certificate.

The measure proposed in this bill would require age pension, disability support pension, widow B pension and carer payment recipients who are aged 80 and over and permanently living overseas to complete a proof-of-life certificate every two years to continue receiving their payment. If a pensioner does not return his or her completed proof-of-life certificate after 13 weeks, their payment will be suspended. If the pensioner does not provide the certificate after a further 13 weeks, making 26 weeks in total, their payment will be cancelled.

The measure includes safeguards to reinstate a living pensioner's payment if that pensioner's pension has been suspended or cancelled. If the pensioner makes contact with the Department of Human Services and provides a completed proof-of-life certificate, the Secretary of the Department of Social Services or an appropriate delegate will have the discretion to reinstate the payment. A pensioner who has his or her payment reinstated will be paid any arrears to which he or she is entitled. This process will make sure that only people entitled to an Australian pension continue to receive it, while at the same time minimising the impact on pensioners who do the right thing.

To help protect against fraud, there is a requirement that the certificates are verified. Pensioners will have a range of options available to have their certificate verified. These may include, but are not limited to, a judge or magistrate of a law court, a medical doctor who is registered or licensed to practice in that country, or an Australian official at an embassy, consulate or high commission. This will provide overseas pensioners with multiple options for verifying their proof-of-life certificates, with a view to making this process as easy and practical as possible.

This government is committed to maintaining a welfare system that is fair and sustainable. The measure introduced in this bill strengthens the integrity of the welfare system by making sure that Australian pensions are only being paid to pensioners who are still alive.

Debate adjourned.

Mr FLETCHER (Bradfield—Minister for Families and Social Services) (10:15): I move:

That this bill be now read a second time.

This bill establishes the National Disability Insurance Scheme Worker Screening Database to support a nationally consistent approach to screening people who work with people with disability in the National Disability Insurance Scheme.

This bill aims to protect and prevent people with disability from experiencing harm from the people who work closely with them.

The National Disability Insurance Scheme is one of the largest social and economic policy reforms in Australian history. It is transforming the lives of people with disability across the country.

January 2019 marked a major milestone, with more than 250,000 Australians now receiving support through the scheme. Around 78,000 of these people are receiving support for the very first time. These figures will continue to grow as the national rollout continues.

At full scheme, it is expected that around 460,000 Australians with disability will be supported, and this will represent an investment of $22 billion a year in supporting people with disability to live with choice and control.

This government is committed to ensuring the safety and wellbeing of participants in the National Disability Insurance Scheme. In December 2016, the Council of Australian Governments (COAG) endorsed the NDIS Quality and Safeguarding Framework. The framework is the result of over three years of consultation with people with disability, carers and providers. It sets out a new approach to regulation for the NDIS to protect NDIS participants.

A key part of the framework is nationally consistent NDIS worker screening. Worker screening is a way to check that people who are working, or seek to work, in the NDIS do not pose an unacceptable risk of harm to people with disability.

Current worker screening arrangements for disability workers are state based and of variable quality. Clearances are not recognised across jurisdictions. A national NDIS Worker Screening Check is a major step forward from the variable arrangements currently operating in each state and territory.

Nationally consistent NDIS worker screening will help create a safe and trusted workforce in the NDIS, and minimise the risk of harm to people with disability. This bill is integral for the implementation of the NDIS Screening Check.

Nationally consistent NDIS worker screening is a joint effort from all Australian governments. We have collectively agreed to the Intergovernmental Agreement on Nationally Consistent Worker Screening for the NDIS. The intergovernmental agreement sets out the responsibilities of states and territories and the Commonwealth.

The new NDIS Worker Screening Check is due to commence in July 2019 in all states and territories, except Western Australia. Western Australia intends to implement worker screening from July 2020.

Through this bill, the Australian government is delivering on our responsibilities under the intergovernmental agreement. We are getting on with the job of ensuring that participants, their families and carers can be satisfied with the quality of services they receive and feel comfortable that necessary protections are in place to ensure their safety.

To support the quality agenda, the government has taken strong, decisive action by establishing an independent, national body—the NDIS Quality and Safeguards Commission—to protect and prevent people with disability from experiencing harm. The government has committed $209 million over four years to support the work of the NDIS commission.

The bill will enable the NDIS commission to establish and maintain a national database for information about NDIS worker screening. This will provide timely and accurate information for employers and self-managed participants about NDIS workers' clearance status.

The NDIS commission commenced operations in New South Wales and South Australia from 1 July 2018. By July 2020, the NDIS commission will be operational in all states and territories. As an independent statutory body with integrated functions and powers, the NDIS commission is a fit-for-purpose, evidence based, responsive regulator.

The NDIS commission is responsible for registering NDIS providers, responding to complaints, managing reportable incidents notifications, and providing leadership to reduce and eliminate the use of restrictive practices in the NDIS.

The NDIS commission will also lead the overall design for nationally consistent NDIS worker screening. This aligns with its responsibility to work with all governments and oversee the broad policy settings for nationally consistent NDIS worker screening, and recognises that the NDIS commission is the national point of contact for NDIS providers.

This national leadership and consistency provides many benefits, but the NDIS commission does not act alone—worker screening is a joint effort. All states and territories have been consulted on the content of the bill and are supportive.

The NDIS Act currently provides for the screening of workers through the registration requirements for registered NDIS providers and the National Disability Insurance Scheme (Practice Standards—Worker Screening) Rules 2018. From July 2019, these checks will be conducted by worker screening units within a nationally consistent framework.

We know from our consultations that stakeholders have consistently supported this approach. They want to see a robust, risk based worker screening check in the disability sector that is portable across jurisdictions.

Worker screening checks will be mandatory for some NDIS workers. Those who have more than incidental contact with a person with disability and who work with a registered NDIS provider must have a clearance. Worker screening will not be mandatory for workers with only incidental contact with participants.

As part of the NDIS worker screening check, worker screening units based in each state and territory will consider applicants' criminal history information, any relevant disciplinary and misconduct information, and information taken from the NDIS commission's complaints and reportable incidents system.

Under this bill, the database will store information about NDIS workers who have applied for an NDIS worker screening check, the status of their application, and decisions by the NDIS worker screening unit about their check, including whether the worker was issued a clearance or an exclusion or not.

This means that NDIS worker clearances will be portable across jurisdictions and employers, including self-managed participants—reducing duplication and complexity for workers and providers moving between, or operating across, jurisdictions. Similarly, a worker who has been excluded by one state or territory will be excluded nationally. This represents a major step forward from the existing fragmented arrangements operating in each state and territory.

The database will also include information about a person's employer, including if this is a self-managed participant. This will ensure that employers are appropriately informed if a worker they have engaged has had their clearance suspended or revoked, or if their clearance expires.

The bill provides for the minister to determine additional information to be included in the database through a legislative instrument. This provides flexibility to respond to future circumstances and is appropriate to accommodate the introduction of a new policy. For example, if there is a new application status required in the future that is not currently envisaged by the bill, the minister may provide for this to be captured in the database.

The protection of people with disability from violence, abuse and neglect is a key priority for all Australian governments. A national approach, as enabled by the database to be established under this bill, eliminates the opportunity for people to make multiple attempts at gaining a worker screening clearance. It prevents people with adverse records in one state or territory from attempting to gain a clearance to work in the NDIS in another state or territory.

The database will provide employers with an important tool for their recruitment, selection and screening processes and help with their responsibility to ensure people chosen to work in the NDIS are safe to work with people with disability. It also provides self-managed NDIS participants and their families with important information to help them make informed choices about workers providing their supports. Employers and self-managed participants will be able to use the database established under this bill to verify that workers hold a clearance.

Importantly, nationally consistent worker screening will deter predatory individuals from seeking work in this sector. Participants and their families can have confidence that workers with clearances have been assessed as not posing an unacceptable risk of harm to people with disability.

The database provides for the ongoing monitoring of clearance holders' criminal history information. Ongoing monitoring provides certainty that unsuitable individuals will not remain in the sector if they do the wrong thing.

Information in the database will be protected NDIS commission information and will only be shared and used for the NDIS commission's legislated functions and other purposes of the NDIS Act. Penalties apply for misuse or unauthorised disclosure.

The Australian government is committed to a high-quality, sustainable National Disability Insurance Scheme. Ensuring that people with disability, their families and carers, and NDIS providers know that workers have a clearance is an important part of having a trusted workforce. The database will provide timely, accurate access to this information for employers and self-managed NDIS participants, ensuring that they can make an informed judgement about who should work with people with disability.

Our paramount consideration is the right of people with disability to live free from abuse, violence, neglect and exploitation. Our government is committed to meeting this objective and ensuring that people with disability are not exposed to harm from those who are there to support them. This bill is a major step forward in implementing nationally consistent NDIS worker screening.

Debate adjourned.

Mr WYATT (Hasluck—Minister for Senior Australians and Aged Care and Minister for Indigenous Health) (10:28): I move:

That this bill be now read a second time.

Today I am introducing the Aged Care Amendment (Movement of Provisionally Allocated Places) Bill 2019. This bill will amend the Aged Care Act 1997to allow the movement of provisionally allocated residential care places from one determined aged-care planning region (region) to another.

The Liberal-National government (the government) is committed to ensuring all older Australians have access to high-quality aged care and services when they need it. Integral to this is supporting approved providers to make residential aged-care places ready for use as quickly as possible.

The government has overarching responsibility for delivery of aged-care services across the country, as part of an end-to-end system covering both residential and in-home aged care. A key policy objective for the government is to ensure that residential aged care is available to those older Australians who require it as quickly as possible, and appropriately allocated to regions to address local needs.

Through a competitive process, residential aged-care places are provisionally allocated to approved providers by the Department of Health (the department) in a region that has a demonstrated need for these services.

Constructing aged-care homes is a difficult, time-consuming and expensive exercise. It takes on average 4.3 years for providers to acquire land, obtain planning approval and construct an aged-care home.

Following an allocation of places, providers can often have difficulties locating suitable land and navigating local government planning processes.

It is not uncommon for suitable land to be located just outside a planning region or for local councils to decide a planned 120-bed aged-care home should only have 100 beds.

In such circumstances, operationalising places in current regions may not be feasible, but by moving them to another region the approved provider can make them available to older Australians more quickly. This is not, however, permissible under the current legislation.

The amendments within this bill seek to change the legislation to allow provisionally allocated residential aged-care places to be moved from one region to another, where a provider can demonstrate that the movement is in the interests of aged-care consumers and there is a clear need for places in the new region.

This bill also makes it clear that, in considering any such application, the department will also consider the needs of the region from which it is proposed to transfer the provisionally allocated places.

In particular, the department will ensure that this does not become a mechanism for moving residential aged-care places out of regional areas of high need to metropolitan areas with a lower need.

This change is in the best interests of all older Australians and the broader community. It will remove a potential barrier to the community in accessing residential aged care, thereby aligning with the government's commitment to ensuring delivery of high-quality aged care and services where and when they're needed.

Debate adjourned.

Mr ROBERT ( Fadden — Assistant Treasurer ) ( 10:32 ): I move:

That this bill be now read a second time.

This bill amends the Corporations Act 2001 (Corporations Act), the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) and the Taxation Administration Act 1953 (Taxation Act) to combat illegal phoenix activity.

Illegal phoenixing involves the stripping and transfer of assets from one company to another by individuals or entities to avoid paying liabilities. It has been a problem over many decades.

This bill will give our regulators additional enforcement and regulatory tools to better detect and address illegal phoenix activity and to prosecute or penalise directors and others who facilitate this illegal activity, such as unscrupulous pre-insolvency advisers.

To support these reforms, the government will also provide an additional $8.7 million over four years from the 2018-19 financial year to increase funding for the Assetless Administration Fund. This additional funding will increase ASIC's ability to fund liquidators who play a vital role in investigating and reporting illegal phoenix activity.

The bill also makes minor amendments to the government's already legislated insolvency reforms which form part of the National Innovation and Science Agenda. These amendments will ensure that these important reforms operate as intended.

Full details of the measures are contained in the explanatory memorandum.

I commend the bill to the House.

Debate adjourned.

Mr ROBERT (Fadden—Assistant Treasurer) (10:34): I move:

That this bill be now read a second time.

This bill increases consumer choice and underpins the coalition government's plan for a stronger economy in ensuring all Australians get a fair go, especially in retirement.

Schedule 1 to the bill increases the maximum number of allowable members in self-managed superannuation funds and small Australian Prudential Regulation Authority funds from four to six.

Self-managed superannuation funds are often used by families as a vehicle for managing their own superannuation savings and investment strategies. For families with more than four members, currently the only real options are to create two self-managed superannuation funds (which would incur extra costs) or place their superannuation in a large fund. This limits their choice and flexibility.

By allowing groups of five or six people to establish a self-managed superannuation fund or small Australian Prudential Regulation Authority fund, schedule 1 to the bill supports greater consumer choice. It provides increased flexibility for Australians to manage their retirement savings, particularly those Australians with larger families.

Schedule 2 to the bill supports the Excise Tariff Amendment (Supporting Craft Brewers) Bill 2019, which extends concessional draught beer excise rates to kegs of eight litres or more.

Currently, draught beer sold at pubs, clubs and other licensed venues from kegs exceeding 48 litres is taxed at lower rates compared with beer sold from smaller kegs.

Extending the concessional draught beer excise rates to kegs of eight litres or more will support craft brewers, which prefer to distribute beer from smaller kegs. This measure levels the playing field between small and large breweries.

As part of this measure, schedule 2 to this bill contains consequential amendments to the Excise Act 1901 to ensure that the concessional rates of excise duty continue to apply only to draught beer dispensed for consumption at licensed commercial premises.

Schedule 3 to the bill will extend the current income tax exempt status of the Global Infrastructure Hub for an additional four years until 1 July 2023.

The hub is a G20 initiative that was created during Australia's 2014 presidency to advance international efforts to lift infrastructure investment. On establishment, the hub was granted tax exempt status to ensure that financial contributions provided by other G20 members were not subject to income tax in Australia.

In July 2018, the G20 agreed to renew the hub's mandate for a further four years. Extending the current income tax exempt status ensures that future financial contributions will not be taxed.

Schedule 4 makes a number of amendments to Treasury portfolio legislation to ensure that the law operates as intended by clarifying the law, correcting technical or drafting defects, removing anomalies and addressing unintended outcomes. The schedule also includes amendments to ensure that there is sufficient flexibility for individuals to access the First Home Super Saver Scheme, so that first home super saver tax applies in circumstances intended by the original policy.

This furthers the government's commitment to restore simplicity and fairness to the Australian tax system and other Treasury laws and to the care and maintenance of the law. By clarifying the laws and repealing unnecessary provisions, these amendments also reduce the regulatory burden and make it easier for Australians to access current laws.

Finally, the Legislative and Governance Forum for Corporations was consulted in relation to schedules 1 and 4 of this bill as required under the Corporations Agreement 2002.

Full details of the measures are contained in the explanatory memorandum.

I commend the bill to the House.

Debate adjourned.

Mr ROBERT (Fadden—Assistant Treasurer) (10:38): I move:

That this bill be now read a second time.

This bill, together with schedule 2 to the Treasury Laws Amendment (2019 Measures No. 1) Bill 2019, extends concessional draught beer excise rates to kegs of eight litres or more to support brewers of craft beer.

Full details of the measure are contained in the explanatory memorandum.

I commend the bill to the House.

Debate adjourned.

Mr ROBERT (Fadden—Assistant Treasurer) (10:40): I move:

That this bill be now read a second time.

This bill creates a set of core provisions related to the administration of business registers in the Superannuation Industry (Supervision) Act 1993 and the A New Tax System (Australian Business Number) Act 1999.

The core provisions have been mirrored in almost their entirety in the Treasury Laws Amendment (Registries Modernisation and Other Measures) Bill 2019.

Full details are contained in the explanatory memorandum, and I commend the bill to the House.

Debate adjourned.

Mr ROBERT (Fadden—Assistant Treasurer) (10:41): I move:

That this bill be now read a second time.

The Treasury Laws Amendment (Registries Modernisation and Other Measures) Bill 2019provides a flexible legislative framework to modernise the Australian Securities and Investments Commission (ASIC) registers and the Australian Business Register (ABR).

The government announced the Modernising Business Registers (MBR) program in the 2018-19 budget. This program will shift the ABR and the ASIC business registers onto a single platform that will be administered by the Australian Business Registrar within the Australian Taxation Office.

To facilitate the implementation of a modernised registries platform, new legislation has been drafted that is flexible, technology neutral and governance neutral.

The legislation allows the minister to appoint a Commonwealth body to be registrar. Rather than having administrative requirements prescribed in primary legislation, the registrar is able to create standards and disclosure frameworks via legislative instruments to assist them in carrying out their registry functions and powers.

The data standards will allow the registrar to determine what and how information is collected and the manner in which it is maintained. The disclosure framework will be used to determine under what circumstance information is disclosed.

This bill also provides a legal framework for the introduction of director identification numbers, or DINs.

The DIN will be a unique identifier for any person who verifies their identity and consents to being a director. Directors will keep their DIN forever, even if their directorship with a particular company changes. This will allow tracking of a person's director profile over time and improve integrity by preventing the use of fictitious identities, which facilitates phoenixing and other fraudulent activity by people who set up companies for dishonest purposes.

DINs are being progressed as part of the Modernisation of Business Registers program to ensure that the DIN is integrated with other important registry data. This enables data to be linked and provides greater insights to regulators, businesses and individuals on the identity and affiliations of directors.

Full details of the measure are contained in the explanatory memorandum. I commend the bill to the House.

Debate adjourned.

Mr ROBERT (Fadden—Assistant Treasurer) (10:44): I move:

That this bill be now read a second time.

This bill supports the Treasury Laws Amendment (Registries Modernisation and Other Measures) Bill 2019 by allowing the registrar to collect fees for registry services.

Full details of the measure are contained in the explanatory memorandum, and I commend the bill to the House.

Debate adjourned.

Mr ROBERT (Fadden—Assistant Treasurer) (10:45): I move:

That this bill be now read a second time.

This bill supports the Treasury Laws Amendment (Registries Modernisation and Other Measures) Bill 2019 by allowing the registrar to collect fees for registry services.

Full details of the measure are contained in the explanatory memorandum, and I commend the bill to the House.

Debate adjourned.

Mr ROBERT (Fadden—Assistant Treasurer) (10:46): I move:

That this bill be now read a second time.

This bill supports the Treasury Laws Amendment (Registries Modernisation and Other Measures) Bill 2019 by allowing the registrar to collect fees for registry services.

Full details of the measure are contained in the explanatory memorandum, and I commend the bill to the House.

Debate adjourned.

Mr ROBERT (Fadden—Assistant Treasurer) (10:47): I move:

That this bill be now read a second time.

This bill strengthens the integrity of the petroleum resource rent tax, the PRRT, and implements the key parts of the government's response to the PRRT Review undertaken by Mr Mike Callaghan AM PSM.

The PRRT is an additional profit-based cash-flow tax on petroleum production, designed to ensure the Australian community receives a fair return on the extraction of Australia's finite petroleum resources whilst minimising disincentives for business to invest in the petroleum industry.

Since the PRRT was introduced in 1988, the nature of Australia's petroleum production has changed, shifting from an industry dominated by crude oil and condensate to a more significant role for liquefied natural gas (LNG). For example, over the last 30 years, oil and condensate production has nearly halved and gas production has increased over sevenfold. Australia is now one of the world's largest LNG exporters.

The government initiated the Callaghan review in November 2016 to provide advice as to whether the PRRT is operating as it was originally intended and to address the reasons for the decline in Australia's PRRT revenues.

The Callaghan review, released in April 2017, found that while the PRRT remained the preferred way to achieve a fair return to the community without discouraging investment, changes should be made for new projects 'to make them more compatible with the developments that have taken place in the Australian oil and gas industry'.

LNG projects typically involve longer periods between discovery and extraction compared to oil projects. Capital expenditure is also generally higher and revenue flows smaller earlier in the life of a project. As a result, large amounts of undeducted expenditure are uplifted for potentially long periods of time before eventually being used to offset revenue once a project starts producing LNG. This allowed deductions to compound, reducing the PRRT.

The review's key recommendation was for a process involving consultation to update the PRRT in the following areas: uplift rates; gas transfer pricing rules; and outcomes of transferred exploration expenditures.

The government undertook this consultation carefully and methodically and on 2 November 2018 announced our final response to the Callaghan review.

The bill introduced today deals with the key design issues identified by the Callaghan review.

Schedule 1 to the bill lowers the uplift rates that apply to certain categories of carried-forward expenditure. This limits the excessive compounding of deductions and updates the PRRT design settings to better reflect Australia's petroleum industry.

General expenditure for PRRT projects that successfully apply for a production licence from 1 July 2019 will be uplifted at the long term bond rate (LTBR) plus five percentage points until 10 years from the financial year in which a project first earns assessable petroleum receipts, and then the long term bond rate. This replaces the indefinite uplift of LTBR plus five percentage points and provides some assurance that projects pay PRRT if the timing of cash flows is different to investment forecasts.

All exploration expenditure incurred or transferred after 1 July 2019 will be uplifted at LTBR plus five percentage points for a maximum of 10 years from the time the expenditure is incurred, with any remaining augmented amount maintained in real terms by applying the GDP deflator until the expenditure is deducted. This change means that exploration expenditures will be capped in real terms rather than being able to compound indefinitely. This is appropriate as exploration expenditures, unlike all other PRRT expenditures, can be transferred and do not attach to a particular PRRT project.

The government will also prospectively alter the uplift rate for exploration expenditure incurred before 1 July 2019 that is deducted within a project at the rate of LTBR plus 15 percentage points. The LTBR-plus-15-percentage-point rate will apply until 1 July 2019, after which the uplift will be LTBR plus five percentage points.

Schedule 2 will remove onshore projects from the PRRT regime from 1 July 2019. No PRRT revenue has been collected from onshore projects since they were brought into the PRRT in 2012, and that is expected to remain unchanged into the future. In practice, onshore projects that would never pay PRRT have been able to transfer their exploration deductions to profitable offshore project interests, reducing PRRT collected. The government's changes protect PRRT revenue, reduce regulatory burdens and simplify the tax. Onshore petroleum projects will remain subject to state resource taxes.

Both schedules in this bill strengthen the integrity of the PRRT and ensure a fairer return for the Australian community for the extraction of our oil and gas resources.

Full details of the measure are contained in the explanatory memorandum.

Debate adjourned.

Mr ROBERT (Fadden—Assistant Treasurer) (10:53): I move:

That this bill be now read a second time.

This government is continuing to back business by helping them to invest and grow by increasing and extending the instant asset write-off. This bill will increase the instant asset write-off threshold from $20,000 to $25,000 and extend it until 30 June 2020. The increased threshold applies from announcement on 29 January 2019.

Across Australia, there are over three million small businesses with an annual turnover of less than 10 million that are eligible to access the $25,000 instant asset write-off. These small businesses employ around 5.7 million Australians or employees.

The government has built on the very successful $20,000 instant asset write-off first introduced by the government in the 2015-16 budget. The government's $25,000 threshold will improve cash flow by enabling business to immediately deduct purchases of eligible assets, each costing less than $25,000.

There is no limit on the amount of assets that a business can purchase. Assets valued at $25,000 or more can be placed into the small business simplified depreciation pool and depreciated at a rate of 15 per cent in the first income year and 30 per cent each year thereafter. The pool itself can also be immediately deducted if its value falls below $25,000 at the end of the financial year.

To facilitate access to this measure, the lockout rules that stop small businesses that elect out of the simplified depreciation regime from re-entering for five years will continue to be suspended until 30 June 2020. This bill will benefit small businesses, improving their cash flow and bringing forward investment. The 25,000 instant asset write-off also reduces red tape for small businesses as they no longer need to track the annual depreciation for assets that are written off immediately or maintain detailed records substantiating their depreciation claims. It will boost small-business activity and encourage more small businesses to re-invest in their operations and replace or upgrade their tools and equipment.

I call on all members and senators to give this measure their fullest support. Full details of the measure are contained in the explanatory memorandum and I commend the bill to the House.

Debate adjourned.

Mr COULTON (Parkes—Assistant Minister for Trade, Tourism and Investment) (10:56): I move:

That this bill be now read a second time.

I'm pleased to introduce this bill to amend the Export Finance and Insurance Corporation Act 1991. The amendments give Australia's export credit agency, Efic, new overseas infrastructure financing power and an extra $1 billion in callable capital. These initiatives will support infrastructure projects in the region that have a benefit for Australia or Australians, and enable Efic to write larger loans, including within its current export mandate. The amendments will enhance Efic's ability to support Australian businesses, and drive stronger links between Australia and its region by enabling Efic to support, more and more, larger overseas infrastructure projects.

Engagement with the region and the Pacific is vitally important. This legislation forms part of the Liberal-National government's package of measures to broaden and deepen our engagement in the Pacific and the region. Australia has a long history of cooperation with its Pacific neighbours. We want to work with our Pacific island partners to build a Pacific region that is secure strategically, stable economically and sovereign politically. This bill enhances our regional commitment, especially to infrastructure. It delivers on the major new initiatives announced by the Prime Minister to address the infrastructure needs of the Pacific region by boosting Efic's ability to support Australian commercial participation in the Pacific's infrastructure, as well as the timely implementation of the Australian Infrastructure Financing Facility for the Pacific.

These measures form part of the Liberal-National government's significant new package of security, economic and people-to-people initiatives that will build strong partnerships in the Pacific. As the Liberal-National government's 2017 Foreign policy white paper outlined, the stability and progress of the Pacific region are of fundamental importance to Australia. No single country can tackle the challenges on its own.

The bill will allow Efic to finance essential overseas infrastructure, such as telecommunications, energy, transport and water, where it is commercially viable. This will complement the Liberal-National government's new Australian Infrastructure Financing Facility for the Pacific, which will stretch our aid dollars even further. The demand for infrastructure financing in our region is large. The Asian Development Bank estimates the Pacific region needs US$3.1 billion in infrastructure investment per year to 2030. It estimates South-East Asia needs a further US$210 billion in infrastructure investment per year by 2030. Efic can play an important role to help meet these needs.

When projects have strong commercial prospects they should be funded commercially. Efic has a track record of supporting infrastructure projects on its commercial account, like the US$19 billion PNG LNG Project, which is the largest ever private sector investment in PNG and will bring significant economic benefit to PNG and provincial governments via tax and royalties, local landholders and local businesses.

The bill grants Efic a new power to finance overseas infrastructure projects, based on a broad Australian benefits tests, enabling it to finance overseas infrastructure projects that result in positive outcomes for Australia both now and in the future. This will enable Efic to take account of previously unrecognised benefits that will flow to Australia or Australians over time as a result of Efic financing, such as a greater Australian participation in supply chains; access to new markets for Australian businesses; more Australian jobs, payments, dividends or other financial proceeds from overseas to Australia; or stronger relationships with our regional partners, especially in the Pacific.

Using an Australian benefit test, Efic could finance a wide range of infrastructure projects in the region. For example, in the telecommunications sector Efic's new power would enable it to finance projects that improve regional connectivity through greater broadband internet access. This benefits Australia by reducing the cost of doing business and increasing our exports to the region, encouraging economic integration and e-commerce opportunities. In the energy sector, Efic's new power would enable it to finance the construction of LNG receivable terminals, leading to increased energy exports or engineering services.

The bill increases Efic's callable capital by $1 billion on its commercial account. A larger capital base will allow Efic to provide more commercially meaningful financing offers, given that the total size of debt financing required for regional infrastructure projects is large, and also to support Australian exporters more broadly.

It will give Efic the commercial flexibility and credibility it requires to offer finance to project proponents, sovereign borrowers and financing partners, who will require the confidence that Efic's support is meaningful and can be sustained over long repayment terms. It will enable Efic to finance more infrastructure projects in Papua New Guinea, one of our most important neighbours. Efic is already approaching its country lending limit for PNG and just one more infrastructure project would see it once again reach this limit, constraining Efic's ability to take up future financings and the jobs and opportunities that will flow to both Australia and PNG from this.

The increase in callable capital is a commitment from the Liberal-National government to increase opportunities for Australia and Australian businesses through Efic. The increase in callable capital will bring Efic's total capital base to nearly $1.7 billion, around a 150 per cent increase, comprising $1.2 billion in callable capital and almost $475 million in cash capital. The increase will enable Efic to provide more financing over time with an unchanged, regulated upper limit for the contingent liability of $6.5 million.

Increasing Efic's callable capital by legislative amendment, rather than by legislative instrument, will provide the higher degree of certainty that infrastructure projects proponents, borrowers and commercial financing partners require when they look to Efic to assist with financing gaps.

The bill will enable Efic to help address the infrastructure needs in the Pacific region. It will complement the new Australian Infrastructure Financing Facility for the Pacific, which is commonly known as the AIFFP. Efic will have the lead where there are stronger commercial prospects, as Efic's financing will be on a commercial basis. The AIFFP will boost Australia's support for infrastructure development in the region by combining loans with grants on a case-by-case basis. The bill will also enable Efic to assist with the timely implementation of the Australian Infrastructure Financing Facility for the Pacific by administering the AIFFP loans. The government will detail how Efic's new power will support the AIFFP and be applied in our region, including the Pacific, under a new statement of expectations.

The government remains committed to ensuring that Efic delivers for Australian exporters, retaining a focus on support for SMEs.

Efic will continue to be required to maximise Australian participation in overseas infrastructure projects. Efic will continue to be required to ensure Australian companies, especially SMEs, have every opportunity to expand into overseas markets.

This bill does not change Efic's existing Australian content requirements or Efic's focus on SMEs.

The bill enhances Efic's existing function to facilitate and encourage exports. It enables Efic to take account of not only the immediate export opportunities from the involvement of Australian companies, including SMEs, in overseas infrastructure projects but future streams of export opportunities and future jobs for Australians arising from the opening of new and emerging markets for Australian businesses. Creating new export oriented jobs is important for Australia's economy. One in five Australian jobs is trade related, and, in the last five years, trade contributed around one-quarter of Australia's economic growth.

The Liberal-National government's trade agenda, which has included delivering comprehensive free trade agreements with Australia's three largest export markets—China, Japan and Korea—has supported Australia's strong economic growth, which is faster than any of the G7 nations.

In 2018, the Liberal-National government delivered the TPP-11, one of the most comprehensive trade deals ever concluded, covering 11 countries with a combined GDP of more than $13.8 trillion and close to 500 million consumers. The TPP-11 benefits Australian farmers, manufacturers, service providers and small businesses.

The Liberal-National government is backing small business via free trade agreements, via tax relief, for around 3.3 million businesses who employ around seven million Australians via this bill.

An enhanced role for Efic in infrastructure will boost its ability to support Australian businesses, including SMEs, which have the specialised skill and knowledge base that underpin major infrastructure projects, increasing Australian participation. For example, Efic's support of the PNG LNG project was crucial in encouraging private sector finance and led to over $1 billion in contracts being awarded to Australian businesses, including SMEs, as well as providing local jobs and valuable export earnings for PNG.

The bill will allow Efic to conduct operations under the name 'Export Finance Australia'.

A new simpler name that references Australia will provide greater recognition for Efic and the Australian government, both with Australian SMEs and other exporters and in important overseas markets. The bill maintains Efic's risk controls and commercially appropriate risk appetite. Efic will continue to conduct rigorous due diligence for infrastructure projects in the same manner as for other transactions under the Efic Act. This includes robust environmental and social risk assessments.

Efic has a strong record of prudent lending and sound commercial judgement, evidenced by a historical write-off rate on its commercial account of less than one per cent. Efic's historical write-off rate is lower than the average for commercial banks across the economic cycle. In each year of the last 20 years, it has delivered a profit on its commercial account. In 2017-18 alone, Efic supported 160 Australian businesses with $194 million of facilities, enabling $1.39 billion of export contracts which contributed $1.15 billion of Australia's GDP and supported 7,600 jobs in Australia.

The bill maintains existing legislative safeguards requiring a net increase in Australian jobs within a business applying for Efic financing for overseas direct investment. It will not provide advantages to overseas competitors or deprive Australian companies who produce in Australia of financial assistance.

The bill will enhance Australia's role and attractiveness as a partner in regional infrastructure development.

It will boost sustainable economic growth and support stronger commercial links between Australian businesses and our region.

Together with the Australian Infrastructure Financing Facility for the Pacific, the bill will help address the infrastructure needs of the Pacific region.

I commend the bill to the chamber.

Debate adjourned.

Mr HAWKE (Mitchell—Special Minister of State) (11:09): I move:

That, in accordance with the provisions of the Public Works Committee Act 1969, it is expedient to carry out the following proposed work which was referred to the Parliamentary Standing Committee on Public Works and on which the committee has duly reported to Parliament: CSIRO Myall Vale New Cotton Breeding Research facilities project.

As advised when this project was referred to the Public Works Committee on 16 August 2018, the Commonwealth Scientific and Industrial Research Organisation is proposing to build a new cotton-processing facility, a laboratory research facility, and a plant and equipment workshop at its existing Myall Vale site in New South Wales. The proposed works will assist the Australian cotton industry to remain ahead of overseas competitors in terms of yield, fibre, quality and resource-use efficiency. It will resolve work health and safety issues, increase productivity and allow the CSIRO to undertake research to assist the Australian agricultural industry to be sustainable, productive and profitable. The project will employ a diverse, skilled range of consultants, contractors and construction workers. It will also provide economic opportunities for the local area through construction contracts. The estimated cost to deliver the project is some $18 million, excluding GST. The committee has conducted an inquiry and considers the project to be value for money for the Commonwealth, fit for purpose and expedient to carry out. On behalf of the government I would like to thank the committee for once again undertaking a timely inquiry. Subject to parliamentary approval of the proposed works, construction is planned to commence in mid-2019 and be completed by early 2021. I commend the motion to the House.

Question agreed to.

Mr HAWKE (Mitchell—Special Minister of State) (11:11): I move:

That, in accordance with the provisions of the Public Works Committee Act 1969, it is expedient to carry out the following proposed work which was referred to the Parliamentary Standing Committee on Public Works and on which the committee has duly reported to Parliament: Defence High Performance Computing Centre.

As advised when the project was referred to the Public Works Committee on 13 September 2018, the Department of Defence is proposing to construct a new fit-for-purpose, high-performance computing centre in the Defence Science and Technology Group precinct at RAAF Base Edinburgh in South Australia. The proposed works will provide the Defence Science and Technology Group in the Australian Defence Organisation with a secure capability for high-fidelity modelling and simulation that it currently does not have. The Defence Science and Technology Group is the Australian government's lead agency responsible for applying science and technology to safeguard Australia and deliver support to the Australian Defence Force on operations, sustainment, improvement to current capability and development of new and emerging capability. The committee has conducted an inquiry and considers the project to be value for money for the Commonwealth, fit for purpose and expedient to carry out. On behalf of the government, I want to thank the committee for once again undertaking a timely inquiry. Subject to parliamentary approval of the project, construction is expected to commence in 2019 and be completed by mid-2020. I commend the motion to the House.

Question agreed to.

Mr HAWKE (Mitchell—Special Minister of State) (11:13): I move:

That, in accordance with the provisions of the Public Works Committee Act 1969, it is expedient to carry out the following proposed work which was referred to the Parliamentary Standing Committee on Public Works and on which the committee has duly reported to Parliament: LAND 200 Tranche 2 Battlefield Communications Systems facilities project.

As advised when the project was referred to the Public Works Committee on 23 August 2018, the Department of Defence is proposing to construct and refurbish facilities to support the training requirements for the battle management systems being introduced under the Land 200 tranche 2 capability, which will modernise the command and control of the Joint Land Force. The 2016 Defence white paper identifies the importance of providing Defence with enhanced situational awareness and decision-making superiority. This project will ensure that the land force can achieve these functions by providing the soldier, the heart of land force capability, with a leading-edge digital communications capability. This project will enable the land force to achieve an unparalleled level of networking across the battle space. The project will employ a diverse range of skilled consultants, contractors and construction workers and provide opportunities for small and medium-sized enterprises throughout the construction trade packages. The estimated cost of the project is $24.3 million, excluding GST.

The committee has conducted an inquiry. It considers the project to be value for money for the Commonwealth, fit for purpose and expedient to carry out. On behalf of the government, I would like to thank the committee for once again undertaking a timely inquiry. Subject to parliamentary approval, construction is expected to commence mid-2019 and be completed by late 2019.

Question agreed to.

Mr HAWKE (Mitchell—Special Minister of State) (11:15): I move:

That, in accordance with the provisions of the Public Works Committee Act 1969, it is expedient to carry out the following proposed work which was referred to the Parliamentary Standing Committee on Public Works and on which the committee has duly reported to parliament: LAND 4502 Phase 1 Additional CH-47F Chinook facilities project.

As advised when the project was referred to the Public Works Committee on 23 August 2018, the Department of Defence is proposing to construct and refurbish shelters and supporting infrastructure for three additional CH-47F Chinook helicopters and the associated increase in staff for the 5th Aviation Regiment at the RAAF Base Townsville, Queensland.

The 2016 Defence white paper noted the government's intention to increase the ADF's airlift capability, including the acquisition of the helicopters. The project expects to generate short-term employment opportunities, predominantly in the building construction and unskilled labour markets in the Townsville region. It is expected that around 50 personnel will be directly employed.

The project is also anticipated to provide potential economic benefits to the local region through the procurement of construction materials. The estimated cost to deliver the project is $49.9 million, excluding GST. This includes management and design fees, construction costs, information and communications technology, furniture, fittings, equipment, contingencies and a provision for escalation.

The committee has conducted an inquiry and considers the project to be value for money, fit for purpose and expedient to carry out. On behalf of the government, I would like to thank the committee for again undertaking a timely inquiry. Subject to parliamentary approval of the works, the plan is to commence construction from early 2019 and be completed in late 2020. I commend the motion to the House.

Question agreed to.

Mr HAWKE (Mitchell—Special Minister of State) (11:17): I move:

That, in accordance with the provisions of the Public Works Committee Act 1969, it is expedient to carry out the following proposed work which was referred to the Parliamentary Standing Committee on Public Works and on which the committee has duly reported to parliament: Naval Guided Weapons Maintenance Facilities project.

As advised when the project was referred to the Public Works Committee on 16 August 2018, the Department of Defence is proposing to construct a purpose-built integrated weapons facility to increase the maintenance capability and alleviate constraints within the Naval Guided Weapons Sustainment System, a Defence establishment at Orchard Hills, located near Penrith in New South Wales.

The 2016 Defence white paper reinforced the necessity for guided weapons maintenance, stating that Defence must maintain a technological edge, while simplifying maintenance of equipment. The project will employ a diverse range of skilled consultants, contractors and construction workers. The project is also anticipated to provide potential economic benefits to the local region through the procurement of construction materials and labour. The estimated cost of the project is $95.5 million, excluding GST.

The committee has conducted an inquiry and considers the project to be value for money for the Commonwealth, fit for purpose and expedient for the parliament to carry out. On behalf of the government, I would like to thank the committee for once again undertaking the inquiry. Subject to parliamentary approval, construction is expected to commence in early 2019 and be completed by mid-2020. I commend the motion to the House.

Question agreed to.

Mr HAWKE (Mitchell—Special Minister of State) (11:19): I move:

That, in accordance with the provisions of the Public Works Committee Act 1969, the following proposed work be referred to the Parliamentary Standing Committee on Public Works for consideration and report: Commonwealth Scientific and Industrial Research Organisation's Sydney Consolidation Project.

The CSIRO Greater Sydney area property portfolio presently comprises seven sites, accommodating approximately 880 full-time staff and over 300 part-time staff and students, across a total of 126,000 square metres of laboratories, technical and specialist support facilities, and commercial office space. CSIRO is proposing to reduce its property portfolio in the Greater Sydney area to five key sites, with the goal of reducing surplus accommodation capacity, providing relief in managing currently escalating property operating, repair and maintenance costs, and delivering fit-for-purpose scientific facilities for current and future science operations. The reduction will be achieved through a mix of divestment, expiry of lease and consolidation of CSIRO capability at five existing sites.

The estimated outturn cost of this project is $113.7 million, excluding GST. The cost estimate includes construction costs, consultant fees, furniture and fittings, escalation and risk provisions. The project will provide significant employment opportunities for local construction industry businesses and support services. Subject to parliamentary approval of the project, construction is expected to commence in late 2019 and be completed in mid-2022. I commend the motion to the House.

Question agreed to.

Mr HAWKE (Mitchell—Special Minister of State) (11:21): I move:

That, in accordance with the provisions of the Public Works Committee Act 1969, the following proposed work be referred to the Parliamentary Standing Committee on Public Works for consideration and report: National Museum of Australia Proposed Gallery Development Stage 1: Life in Australia.

The National Museum of Australia has a program of gallery renewal that will redevelop the current permanent galleries into three distinct spaces with a linked narrative experience that will tell the story of Australia. These works are part of the National Museum of Australia's asset replacement program. The first phase of the program is the redevelopment of the current Old New Land exhibition space with a new 1,500 square metre permanent exhibition of environmental history, provisionally entitled Life in Australia; a new multipurpose mezzanine for both exhibitions and functions; and new external stairs. The work will be within the existing National Museum of Australia building, located on the Acton Peninsula in Canberra.

The estimated cost of the works is $19.4 million, GST exclusive, and the total cost is $20.5 million from 2015 to 2016 and will be fully funded by the National Museum of Australia. This cost estimate includes construction costs, consultant fees, furniture and fittings, escalation and risk provisions. The fit-out will create jobs during the construction and fit-out works and support local trades and services through ongoing maintenance and supply requirements. Subject to parliamentary approval of the works, construction is expected to commence in mid-2019 and be completed by the end of 2020. I commend the motion to the House.

Question agreed to.

Mr HASTIE (Canning) (11:35): On behalf of The Parliamentary Joint Committee on Intelligence and Security, I present the following reports: Advisory report on the Crimes Legislation Amendment (Police Powers at Airports) Bill 2018 and Review of Administration and Expenditure No. 16 (2016-2017): Australian Intelligence Agencies.

Reports made a parliamentary paper in accordance with standing order 39(e).

Mr HASTIE: by leave—The Crimes Legislation Amendment (Police Powers at Airports) Bill 2018 seeks to ensure that the aviation network is safe and secure for all Australians and addresses advice from Australian Federal Police that the current powers available to police to check evidence of identity at airports are no longer fit for purpose.

Consequently, the bill makes several amendments to the Crimes Act to provide additional powers for police at airports. These proposed powers include empowering constables and AFP protective service officers to direct individuals to move on from an airport; enabling officers to direct an individual not to take a flight to or from a major airport for a specific period of up to 24 hours; and providing police with new grounds to issue a direction, based on safeguarding aviation security.

During its review of the bill, the committee examined whether the new powers were proportional to the threat posed to aviation security and considered whether oversight and accountability mechanisms were sufficient and appropriate.

The committee received seven submissions to its inquiry and four supplementary submissions. It held a public hearing on 17 October 2018 in Canberra.

The committee made nine recommendations in relation to the bill.

The first recommends a change to the definition of 'aviation security' to specify the scope of activities to which the term applies.

The second introduces a savings provision to ensure that the new laws do not interfere with the right to peaceful protest or assembly.

The third introduces annual reporting obligations on the Australian Federal Police to inform the public on how often the powers are used.

The fourth provides for expedited judicial review in certain restricted circumstances.

The fifth recommends that the term 'senior police officer' be defined in the bill.

The sixth introduces further additional annual reporting obligations on the Australian Federal Police on the use of the powers.

The seventh requires police officers to ensure that all authorisations given orally are documented in writing as soon as practicable.

The eighth recommendation is to ensure that obligations for police to provide information, if requested, apply equally to uniformed and plain-clothes officers.

And finally, the ninth and final recommendation is that, subject to implementation of these recommendations, the bill be passed.

The second report I have tabled today fulfils the committee's statutory oversight responsibility to review the administration and expenditure of the six Australian intelligence agencies, including the Australian Security Intelligence Organisation, the Australian Secret Intelligence Service, the Office of National Assessments and the three defence intelligence agencies.

Through its review, the committee received comprehensive submissions and conducted private hearings with each of the agencies. The committee also took evidence from the Inspector-General of Intelligence and Security.

The committee is satisfied that agencies are overseeing their administrative functions effectively.

Agencies have continued to respond to the changing security environment, and with the support of funding have invested in a range of new programs and capital projects to enhance their future capacity.

The committee carefully scrutinised each agency's financial management arrangements, including their internal controls.

On the basis of the evidence provided, the committee was satisfied that agencies appropriately managed their expenditure in 2016-17.

While this review relates to the 2016-17 financial year, the report recognises that the intelligence community is currently undergoing a period of significant change.

This change has been largely driven by the recommendations of the 2017 Independent Intelligence Review, conducted by Mr Michael L'Estrange and Mr Stephen Merchant, as well as the machinery-of-government changes following the creation of the Department of Home Affairs.

As the report notes, these changes will also affect the role of the PJCIS and that of the Inspector-General of Intelligence and Security.

The committee took the opportunity during its private hearings to discuss some of the implications of these changes with the inspector-general and affected agencies.

The committee considered it essential that as these changes occur within the intelligence community, a corresponding and effective level of oversight be maintained.

The committee therefore welcomed the increased funding for the Office of the Inspector-General of Intelligence and Security.

Noting the legislative and machinery-of-government reforms that have already occurred, the committee considers that amendments to expand the inspector-general's remit, and other oversight mechanisms, should be brought forward without delay.

The committee looks forward to continuing to engage closely with the intelligence agencies as the administrative arrangements within which they operate are revised.

I commend both reports to the House.

Mr DREYFUS (Isaacs—Deputy Manager of Opposition Business) (11:40): by leave—The Parliamentary Joint Committee on Intelligence and Security has today handed down a bipartisan report recommending the passage of the Crimes Legislation Amendment (Police Powers at Airports) Bill 2018. A number of recommendations have been made to improve the bill and make it stronger and more effective. Those recommendations, if implemented, would also make it clear that the new powers cannot be used to interfere with the right to peaceful assembly.

If legislation reflecting these bipartisan recommendations is presented by the government and passed by the parliament, the rules governing the powers of police at airports around Australia will be unified for the first time and strengthened. Police constables and protective service officers will have the power to direct a person to move on from airport premises or to prevent a person from taking a specified flight when that person is reasonably suspected to have committed, be committing or be intending to commit an offence punishable by 12 months imprisonment or more, or if it is necessary to safeguard aviation security. It also expands the existing power that constables have to direct a person to produce evidence of their identity in specified circumstances.

Labor is absolutely dedicated to giving enforcement and security agencies the powers they need to keep Australians safe. Labor has always taken a bipartisan approach to national security matters and will continue to do so even as the government continually tries to trash that approach. We have helped to make more than 500 amendments to national security bills since 2013. Every one of those has made our laws stronger and more effective. Today's report shows that the bipartisan process of the Parliamentary Joint Committee on Intelligence and Security remains intact. Labor will do all it can to uphold the vital role of the committee while the government descends into hysterical attacks.

Dr LEIGH (Fenner) (11:43): Labor will support the Parliamentary Service Amendment (Post-election Report) Bill 2018, which implements one of the recommendations of the independent review into the Parliamentary Budget Office. It will give more time for the Parliamentary Budget Office to release their post-election report on election commitments. That post-election report lists the commitments made by major parties during an election campaign that will have a material impact on the Commonwealth budget. Currently, it must be published within 30 days after the end of the caretaker period for the general election. These amendments change that, giving the Parliamentary Budget Office more time, so that the report will need to be published by either 30 days after the caretaker period or seven days prior to the first sitting day of either or both houses of the parliament, whichever date is later.

This change takes into account other recommendations of the independent review which noted that the report can take longer to compile if it includes things such as medium-term financial impacts. It has been Labor that has led the way on medium-term costings, recognising that for many policies it's important to understand the implications not just over the four years but also over the decade. This is particularly true with grandfathered reforms, such as Labor's changes to capital gains and negative gearing, where the impact over the 10 years is materially different from the impact over four years. It's important, too, when we're thinking about long-term policies and the issues typically raised in the Intergenerational report, that we aren't simply confined to thinking about fiscal costs over a four-year window.

The Parliamentary Budget Office has accepted the other recommendations of the independent review and is undertaking a process to implement them. The independent review was finalised in 2017. Labor welcomed the Parliamentary Budget Office's acceptance of all of the recommendations put forward by Ian Watt and Barry Anderson. It recognised that the Parliamentary Budget Office has been a successful institutional development in Australian governance, filling a significant gap in our public policy landscape. It produces rigorous, independent and non-partisan analysis that ensures that we are debating the substance of policies rather than how much they will cost.

I remember that so many of the elections in my childhood were focused on costings. The costings battles between costings that had been prepared for the opposition by independent accounting firms were brought into scrutiny, with the government saying that policies would cost different amounts from those private firms. It meant that the political debate was distracted from the substance of the reform and moved on to the narrow technocratic question of how much it will cost.

The Parliamentary Budget Office is an equal status coster to the Treasury, a point sometimes missed by those opposite. Labor established it. We are proud of the institution it's become. It's helped the parliament and the public develop a deeper understanding of the budgetary impacts on policies being considered. Its independence and focus on transparency have improved the information and data available to the public. The Parliamentary Budget Office also produces regular reports on important fiscal issues, which shine a light onto key questions around budget sustainability and ensure that the public has a strong idea of who is bearing the heavy lifting for fiscal changes.

But for all the important work the Parliamentary Budget Office does, it can't stop the wasteful spending of those opposite. And nothing but an election will put an end to the budget mismanagement that has occurred under the aptly named ATM government. The Abbott-Turnbull-Morrison government has been treating the Commonwealth budget like its own personal ATM, racking up debt that is now, in net terms, $360 billion. That's double what they inherited when they came to office. That means that a majority of Australia's net debt today was accrued by the ATM government. The Abbott-Turnbull-Morrison government is responsible for more than half of Australia's debt.

When they speak about Labor's debt they are speaking about a minority of Australia's debt, debt accrued in order to stare down the global financial crisis, the greatest downturn to strike the world since the Great Depression and in which Australia—unusually, among advanced countries—managed to put in place a timely, targeted and temporary fiscal stimulus to see us not incur recession. That ensured that hundreds of thousands of jobs were saved, that tens of thousands of small businesses were saved.

What's the excuse for the coalition? Gross debt has crashed through half a trillion dollars now for the first time in the nation's history. It's a record $542 billion and rising. We can put this in personal terms. Net debt for Australians is now $360 billion. That's around $14,000 for every man, woman and child in Australia. Most of that was accrued by the coalition. Last year alone the Liberals blew $200 million on political ads to distract from their cuts and chaos and the division and dysfunction that has characterised the government.

Australians want their taxes to fund better schools. They want their taxes to fund reduced elective and emergency surgery wait times—

The DEPUTY SPEAKER ( Mr Andrews ): The member for Fenner is straying from the subject matter of the bill. I'd ask him to direct his attention to the bill.

Dr LEIGH: I appreciate your guidance, Deputy Speaker Andrews. The Parliamentary Budget Office's integrity will show, at the next election, the total cost of policies put forward by both sides—including political advertising—including Labor's reforms to ensure that we no longer spend $100 million on cash refunds for excess franking credits. The Parliamentary Budget Office has costed our policies, and the Parliamentary Budget Office's figures ensure that Labor will go to the next election offering more generous personal income tax cuts for anyone earning under $125,000, we will pay down debt faster than the coalition over four years and over 10, and we will invest more in schools and hospitals. These are policies costed by the Parliamentary Budget Office in the independent and authoritative way that they are able to do.

We'll support the bill. We established the Parliamentary Budget Office. We're proud of the institution it has become, and we believe it is appropriate that it have a little more time post the election to prepare that report and to consider, in particular, the medium-term financial impacts of policies prepared by the major parties. I commend the bill to the House.

Mr HUNT (Flinders—Minister for Health) (11:51): Firstly, I'd like to thank those members who have contributed to the debate on the Parliamentary Service Amendment (Post-Election Report) Bill. The bill will help to ensure that the time frame for the Parliamentary Budget Office to prepare the post-election report of election commitments allows additional time and additional scope to increase the way in which the report is able to include medium-term financial impacts of election commitments and include the policies of parties with less than five members, where that party has asked to be included. Additional time is also expected to enhance the visibility of the post-election report by moving the timing closer to the resumption of parliamentary sittings. Expanding the scope of the post-election report will increase transparency around the budget impacts of the election commitments that have been made by political parties. It is important the post-election report is accessible, informative and available in time to inform deliberations of the parliament.

I particularly want to acknowledge, and thank for their work, the Prime Minister, the Treasurer and especially the finance minister in ensuring that this change is brought forward. It builds upon the work that they have done in order to secure the nation's finances. Of course, we inherited a large fiscal black hole in 1996, and we repaired that. That, coupled with the financial services regulation, enabled Australia to pass through the GFC. It was not expenditure on pink batts and school halls which did that; it was the fiscal situation of the nation which allowed us to ensure that we avoided the worst of the international excesses and the worst of the international downturn.

At the same time, when we came into office in 2013, there was a deep structural deficit which had been built. Almost all attempts to pass legislation through the parliament which would deal with that structural deficit were blocked by those on the other side. Despite that, we have been able to bring the budget back to surplus, and I think that that is an abiding achievement. I want to honour, thank and congratulate the finance minister, the Treasurer and the Prime Minister for their work in that event. I commend the bill to the House.

Question agreed to.

Bill read a second time.

Mr HUNT (Flinders—Minister for Health) (11:54): by leave—I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

The DEPUTY SPEAKER ( Mr Vasta ) (11:54): On behalf of the Speaker, I present report No. 35 of the Selection Committee relating to the consideration of committee and delegation business and private members' business on Monday, 18 February 2018. The report will be printed in the Hansard for today, and the committee's determinations will appear on tomorrow's Notice Paper. Copies of the report have been placed on the table.

The report read as follows—

Report relating to the consideration of committee and delegation business and of private Members' business

1. The committee met in private session on Wednesday, 13 February 2019.

2. The Committee deliberated on items of committee and delegation business that had been notified, private Members' business items listed on the Notice Paper and notices lodged on Tuesday, 12 February 2019, and determined the order of precedence and times on Monday, 18 February 2019, as follows:

Items for House of Representatives Chamber (10.10 am to 12 noon)

PRIVATE MEMBERS' BUSINESS

Notices

1 Ms M. M. H. King: To present a Bill for an Act to amend the National Consumer Credit Protection Act 2009, and for related purposes. (National Consumer Credit Protection Amendment (Small Amount Credit Contract and Consumer Lease Reforms) Bill 2019)

(Notice given 29 November 2018.)

Presenter may speak to the second reading for a period not exceeding 10 minutes—pursuant to standing order 41. Debate must be adjourned pursuant to standing order 142.

2 Mr Wilkie: To present a Bill for an Act to provide a legislative response to all people seeking asylum in Australia, and for related purposes. (Refugee Protection Bill 2019)

(Notice given 12 February 2019.)

Presenter may speak to the second reading for a period not exceeding 10 minutes—pursuant to standing order 41. Debate must be adjourned pursuant to standing order 142.

3 Mr Bandt: To present a Bill for an Act to prohibit the mining of thermal coal in the Galilee Basin, and for related purposes. (Galilee Basin (Coal Prohibition) Bill 2019)

(Notice given 12 February 2019.)

Presenter may speak to the second reading for a period not exceeding 10 minutes—pursuant to standing order 41. Debate must be adjourned pursuant to standing order 142.

4 Mr Bandt: To present a Bill for an Act to restrict activities in relation to thermal coal, and for related purposes. (Coal Prohibition (Quit Coal) Bill 2019)

(Notice given 12 February 2019.)

Presenter may speak to the second reading for a period not exceeding 10 minutes—pursuant to standing order 41. Debate must be adjourned pursuant to standing order 142.

5 Ms Sharkie: To present a Bill for an Act to amend the Banking Act 1959 in relation to loans to primary production businesses, and for related purposes. (Banking Amendment (Rural Finance Reform) Bill 2019)

(Notice given 12 February 2019.)

Presenter may speak to the second reading for a period not exceeding 10 minutes—pursuant to standing order 41. Debate must be adjourned pursuant to standing order 142.

6 Ms McGowan: To present a Bill for an Act to establish the Office for Regional Australia, and for related purposes. (Office for Regional Australia Bill 2019)

(Notice given 12 February 2019.)

Presenter may speak to the second reading for a period not exceeding 10 minutes—pursuant to standing order 41. Debate must be adjourned pursuant to standing order 142.

7 Mr Katter: To present a Bill for an Act to amend the Reserve Bank Act 1959, and for related purposes. (Reserve Bank Amendment (Australian Reconstruction and Development Board) Bill 2019)

(Notice given 12 February 2019.)

Presenter may speak to the second reading for a period not exceeding 10 minutes—pursuant to standing order 41. Debate must be adjourned pursuant to standing order 142.

8 Ms Sharkie: To present A Bill for an Act to amend the Export Control Act 1982, and for related purposes. (Export Control Amendment (Banning Cotton Exports to Ensure Water Security) Bill 2019)

(Notice given 12 February 2019.)

Presenter may speak to the second reading for a period not exceeding 10 minutes—pursuant to standing order 41. Debate must be adjourned pursuant to standing order 142.

9 Ms O'Toole: To move:

That this House:

(1) notes that:

(a) Townsville has experienced the worst floods in recorded history;

(b) Townsville received a year's rainfall in nine days, with 1,134 millimetres recorded up to 9 am on Monday 4 February 2019, reaching over 1.65 metres;

(c) the Ross River Dam reached a record breaking 244 per cent capacity; and

(d) more than 22,000 homes and 110 roads in Townsville were affected by this extreme weather event;

(2) acknowledges the:

(a) professional and skilled work undertaken by the Townsville Local Disaster Management Group;

(b) dedicated and collaborative work undertaken by the Australian Defence Force (ADF), Emergency Services and State Emergency Services (SES) in rescuing stranded residents in dangerous circumstances;

(c) commitment and hard work of the ADF in the massive recovery clean-up process; and

(d) amazing work of the SES, Ergon Energy, Townsville City Council workers, businesses and the thousands of community volunteers for their efforts to assist the many people whose homes were inundated; and

(3) calls on the Government to end the confusion related to the disaster recovery payment and assist the thousands of distressed Townsville residents during this difficult time.

(Notice given 12 February 2019.)

Time allotted—remaining private Members' business time prior to 12 noon

Speech time limits—

Ms O'Toole—10 minutes.

Next Member speaking—10 minutes.

Other Members—5 minutes each.

[Minimum number of proposed Members speaking = 2 x 10 mins + 2 x 5 mins]

The Committee determined that consideration of this should continue on a future day.

Items for Federation Chamber (11 am to 1.30 pm)

PRIVATE MEMBERS' BUSINESS

Notices

1   Mr Entsch: To move:

That this House:

(1) notes that:

(a) 24 March is World Tuberculosis Day, a day to commemorate the precious lives lost due to tuberculosis, a disease that is preventable and curable;

(b) tuberculosis is contagious and airborne—it is the world's leading infectious disease killer, killing more people than HIV/AIDS;

(c) in 2017 alone, 1.6 million people died from tuberculosis worldwide and 10 million people became sick with the disease; and

(d) there is a funding gap of US$1.3 billion annually in tuberculosis research and development and it is critical to develop quicker diagnostic tools, better drugs, and a new tuberculosis vaccine in order to end the tuberculosis epidemic;

(2) recognises that the:

(a) funding that Australia is providing jointly with the World Bank to support testing and treatment in Papua New Guinea is already leading to an initiative to achieve universal testing for tuberculosis in Daru; and

(b) provision of $75 million over five years for Product Development Partnerships in the lndo‑Pacific health security initiative to accelerate access to new therapeutics and diagnostics for drug resistant tuberculosis and malaria, building on the successes of Australia's previous investments; and

(3) calls on the Government to:

(a) develop an action plan to monitor the progress made towards the targets and commitment made at the United Nations High-Level Meeting on TB; and

(b) make an increased financial commitment to the Global Fund at its Replenishment Conference in October 2019.

(Notice given 12 February 2019.)

Time allotted—30 minutes.

Speech time limits—

Mr Entsch—5 minutes.

Other Members—5 minutes. each.

[Minimum number of proposed Members speaking = 6 x 5 mins]

The Committee determined that consideration of this should continue on a future day.

2   Ms Ryan: To move:

That this House:

(1) acknowledges that our public schools are at the heart of our education system;

(2) notes that:

(a) public schools teach two in three of all school students, and the overwhelming majority of Australia's neediest children, including:

(i) 82 per cent of the poorest children;

(ii) 84 per cent of Indigenous children; and

(iii) 74 per cent of children with disabilities;

(b) under the current Government, almost nine in ten (88 per cent) of public schools will never get to their fair funding level because the Government has capped federal funding for public schools at just 20 per cent of the Schools Recommendation Scheme;

(c) after spending a year trying to deny there were cuts, the fact the Government has restored funding to Catholic and independent schools was finally an admission that it is cutting billions of dollars from schools;

(d) Labor has announced a plan to restore funding to public schools; and

(e) Labor's plan will transform public schools across Australia and give all children the opportunity to reach their full potential, no matter where they live, or what amount their parents earn; and

(3) calls on the Government to:

(a) immediately adopt Labor's plan to restore funding to public schools to ensure every public school reaches its fair funding level; and

(b) work with school systems to get every school to its fair funding level.

(Notice given 12 February 2019.)

Time allotted—40 minutes.

Speech time limits—

Ms Ryan—5 minutes.

Other Members—5 minutes. each.

[Minimum number of proposed Members speaking = 8 x 5 mins]

The Committee determined that consideration of this should continue on a future day.

3   Mr Leeser: To move:

That this House:

(1) strongly endorses An India Economic Strategy To 2035, the independent report by Mr Peter Varghese AO, and its goals of:

(a) lifting India into Australia's top three export markets by 2035;

(b) making India the third largest destination in Asia for Australian outward investment; and

(c) bringing India into the inner circle of Australia's strategic partnerships, and with people to people ties as close as any in Asia;

(2) recognises the unprecedented opportunity for Australia to cement India as a priority economic partner; and

(3) acknowledges the importance of building a broad and deep bilateral relationship based on:

(a) a sustainable long term economic strategy;

(b) our shared strategic interests in the Indo-Pacific, including the importance of the rules based international order; and

(c) the strength of the Indian community in Australia, the fastest growing diaspora in our nation.

(Notice given 26 November 2018.)

Time allotted—40 minutes.

Speech time limits—

Mr Leeser—5 minutes.

Other Members—5 minutes. each.

[Minimum number of proposed Members speaking = 8 x 5 mins]

The Committee determined that consideration of this should continue on a future day.

4   Ms Owens: To move:

That this House:

(1) acknowledges:

(a) that 21 February is International Mother Language Day (IMLD);

(b) the work of the Ekushe Academy Australia and the Mother Language Conservation Movement in creating awareness of the importance of mother languages in Australia;

(c) that 2019 is the Year of Indigenous Languages; and

(d) that about 200 different languages are spoken throughout Australia; and

(2) calls on the Australian Government to:

(a) observe IMLD on 21 February;

(b) promote the preservation and protection of all languages used by people around the world, especially in Australia;

(c) build on Australia's multilingual strengths including support for second language education in Australian education institutions; and

(d) actively work to support communities in their efforts to preserve their mother language.

(Notice given 12 February 2019.)

Time allotted—20 minutes.

Speech time limits—

Ms Owens—5 minutes.

Other Members—5 minutes. each.

[Minimum number of proposed Members speaking = 4 x 5 mins]

The Committee determined that consideration of this should continue on a future day.

Orders of the Day

1   Aged Care Amendment (Staffing Ratio Disclosure) Bill 2018 (Ms Sharkie): Second reading—Resumption of debate (from20August2018).   

Time allotted—remaining private Members' business time prior to 1.30 pm

All Members—5 minutes. each.

[Minimum number of proposed Members speaking = 4 x 5 mins]

The Committee determined that consideration of this should continue on a future day.

Items for Federation Chamber (4.45 pm to 7.30 pm)

PRIVATE MEMBERS' BUSINESS

Notices—continued

5   Mr Leeser: To move:

That this House:

(1) acknowledges that parts of Australia have been affected by fire, floods and storms during the recent summer period;

(2) recognises the support the Government has given in response to these disasters;

(3) also recognises the outstanding work of emergency services, the Australian Defence Force and volunteers in supporting victims of these natural calamities; and

(4) offers support to the victims of the fires, floods and storms and will do all we can to support our fellow Australians in their time of need.

(Notice given 12 February 2019.)

Time allotted—60 minutes.

Speech time limits—

Mr Leeser—5 minutes.

Other Members—5 minutes. each.

[Minimum number of proposed Members speaking = 12 x 5 mins]

The Committee determined that consideration of this should continue on a future day.

6   Mr B. K. Mitchell: To move:

That this House:

(1) recognises the devastating impact that the recent bushfires have wreaked across Tasmania, particularly in the Central Highlands, Derwent Valley and the Huonville regions, and that sadly these fires have:

(a) burnt more than 194,000 hectares of land, including many unique natural areas such as the Tasmania Wilderness World Heritage Area; and

(b) resulted in:

(i) the loss of eight homes while causing damage to others and to infrastructure;

(ii) significant damage to the iconic Tahune Airwalk at Geeveston; and

(iii) significant economic loss to affected regions from the loss of trade, wages and tourism;

(2) acknowledges and commends the:

(a) work and dedication of the men and women of the Tasmanian Fire Service (TFS) who have demonstrated remarkable courage and strength while working relentlessly to contain and extinguish the fires;

(b) women and men who travelled from interstate and New Zealand to offer assistance and to support the work of the TFS;

(c) contribution of Tasmania's volunteer firefighters who demonstrated unflinching dedication for days and weeks, often at significant personal cost in terms of lost family time, wages and consumption of annual leave; and

(d) resilience and strength of the Tasmanian people and their willingness to rally in support of firefighters and fire affected communities, including volunteers and others who operated and staffed evacuation centres at Bothwell and Huonville; and

(3) calls on the Australian Government to:

(a) continue to provide disaster relief funding to Tasmania as per established Commonwealth-state processes, and ensure there is no unnecessary delay in the distribution of federally funded relief to affected parties; and

(b) liaise with the Tasmanian Government on an appropriate Commonwealth funding contribution to rehabilitate fire affected World Heritage and other wilderness, which does not qualify for assistance under existing disaster relief agreements.

(Notice given 12 February 2019.)

Time allotted—35 minutes.

Speech time limits—

Mr B. K. Mitchell—10 minutes.

Other Members—5 minutes. each.

[Minimum number of proposed Members speaking = 1 x 10 mins + 5 x 5 mins]

The Committee determined that consideration of this should continue on a future day.

Orders of the Day—continued

2 Economic management: Resumption of debate (from 23 October 2018) on the motion of Mr van Manen—That this House:

(1) notes that over the year, the economy grew 3.4 per cent, which is the fastest rate of growth since the 2012 September quarter during the height of the mining investment boom, and the 27th year of consecutive economic growth;

(2) recognises that strong employment outcomes have been accompanied by an elevated rate of labour force participation, particularly for women, and that wages can be expected to rise if economic growth remains strong; and

(3) calls on the Government to remain resolute in its effective economic management to ensure funding for the essential services we need.

(Order of the day will be removed from the Notice Paper unless re-accorded priority on any of the next 6sitting Mondays including 18 February 2019.)

Time allotted—30 minutes.

Speech time limits—

All Members—5 minutes. each.

[Minimum number of proposed Members speaking = 6 x 5 mins]

The Committee determined that consideration of this should continue on a future day.

7   Mr Giles: To move:

That this House:

(1) pays tribute to the work done on loneliness in the United Kingdom in memory of Mrs Jo Cox;

(2) acknowledges that:

(a) the Jo Cox Loneliness Commission's inquiry into loneliness has succeeded due to bipartisan support, including the appointment of a responsible minister; and

(b) there is a similar problem in Australia, but it is less well understood than it should be, particularly having regard to its impacts on younger Australians and the influence of social media; and

(c) the problem of loneliness is under recognised, despite its acknowledged and significant negative impacts on individuals and society;

(3) notes the work of Australian academics and civil society in this area; and

(4) calls for a national response in Australia, to better understand the scope of the challenge and to inform and support an evidence based policy response.

(Notice given 27 November 2018. Notice will be removed from the Notice Paper unless called on on any of the next 7sitting Mondays including 18 February 2019.)

Time allotted—20 minutes.

Speech time limits—

Mr Giles—5 minutes.

Other Members—5 minutes. each.

[Minimum number of proposed Members speaking = 4 x 5 mins]

The Committee determined that consideration of this should continue on a future day.

8   Mr Hayes: To move:

That this House:

(1) recognises the Australian Parliament's ongoing commitment to the global promotion of democracy, human rights and respect for the rule of law;

(2) notes with concern the existence of a policy of extrajudicial killing in the Philippines, an issue which has escalated with a nationwide drug campaign based merely on suspicion, providing police and vigilante groups with a 'licence to kill';

(3) notes that Philippine Senator Leila De Lima, the former Secretary of Justice, has been a notable critic of President Rodrigo Duterte's policy of extrajudicial killing;

(4) notes the deteriorating plight of Senator De Lima, who since 24 February 2017 has been arbitrarily detained without trial, charged with drug related offences on the strength of untested statements of convicted drug lords, police officers and prison officials;

(5) further notes that the conditions and circumstances of her arbitrary detention have restricted her:

(a) freedom of movement; and

(b) capacity to carry out her duties as an incumbent Senator of the Republic of the Philippines, including the very fundamental and critical right of a legislator to attend parliamentary hearings and cast her vote on legislative measures;

(6) also notes that President Duterte is on record having made a number of attacks against Senator De Lima, publicly vowing to destroy her;

(7) further notes that the United Nations Working Group on Arbitrary Detention of the United Nations Human Rights Council, handed down a ruling in November 2018 confirming the injustice of Senator De Lima's arrest and has recommend a number of measures be adopted by the Government of the Republic of the Philippines, most notably, her immediate release; and

(8) calls on the Australian Government to use all diplomatic measures to urge the Philippine Government to:

(a) immediately:

(i) release Senator De Lima from incarceration; and

(ii) remove all undue personal and work restrictions that have been placed on her;

(b) ensure the conduct of a fair and transparent trial, consistent with the rule of law; and

(c) permit Senator De Lima to fully discharge her office as a duly elected Senator.

(Notice given 12 February 2019.)

Time allotted—remaining private Members' business time prior to 7.30 pm

Speech time limits—

Mr Hayes—5 minutes.

Other Members—5 minutes. each.

[Minimum number of proposed Members speaking = 4 x 5 mins]

The Committee determined that consideration of this should continue on a future day.

Ms RISHWORTH (Kingston) (11:54): Today I rise to speak on the Defence Legislation Amendment Bill 2018. I'd like to start by acknowledging all those men and women who serve in our defence forces around Australia. We talk a lot about the assets—the submarines and ships and a whole lot of different equipment—but of course our greatest defence asset is the people that serve. They put their lives on hold to serve our country, and they deserve our respect, gratitude and support now and into the future. It is also important to recognise those who are no longer serving but who have served our country in the past.

The bill before us today seeks to improve the transparency and independence of the military justice system, to strengthen protection for reservists and to clean up some redundant provisions. Schedule 1 particularly deals with military justice and seeks to enhance the independence of judge advocates and provide greater transparency in their selection and termination.

Judge advocates are senior military legal officers appointed by the Chief of the Defence Force, or service chief, following a nomination by the Judge Advocate General. They may be appointed as the judge advocate for a court martial, assisting court martial members with the application of military law. Alternatively, they may be appointed as a Defence Force magistrate to try charges referred to the Registrar of Military Justice. These members are central to the operation of our superior service tribunals in the military justice system, and, given the importance of such roles, it is appropriate that the bill before us gives consideration to improving the independence and transparency of the selection, length of appointment, termination and remuneration of such members.

There were calls in the past for more independence for these positions. The 2016 annual report by the Judge Advocate General stated:

… the existing legislation does not provide optimal safeguards of the independence of such JA appointments: these other JA appointments are only for terms of three years, are renewable and lack the benefit of pay fixed by the Commonwealth Remuneration Tribunal.

The bill is important in addressing these issues. Under these changes, members of the judge advocate's panel will have their remuneration set by the Remuneration Tribunal, a statutory body which determines the pay of key Commonwealth officers. It is appropriate that the tribunal determines the amount of pay for judge advocates, which will enhance their independence from Defence. This bill also addresses the length of service issue noted in the 2016 report by increasing the length of service from three to five years.

It should be noted that previous Judge Advocate Generals have also called for the appointment of judge advocates to be made not by the Chief of the Defence Force but by the Governor-General-in-Council to afford them greater independence. It is important to note that this bill does not make that change. However, the opposition sees the changes in the bill as important steps in improving the independence of judge advocates, even though the CDF is still able to appoint them.

Labor has sought the views of a number of organisations, including the current Judge Advocate General, and has been advised by the government that those organisations do not oppose this bill. DFWA have also been consulted by the opposition, and they also support this bill. Therefore, we will be supporting these amendments.

In addition, there have been changes to this bill to improve the transparency of the selection criteria for judge advocates which will see the Chief of the Defence Force determine the selection criteria and the selection process for appointment to the panel via an instrument. At the moment, it is completely discretionary around these selection criteria, and so better transparency in the selection criteria and process is an important step forward. I note there were concerns raised about the fact that the selection criteria—while an important step forward in terms of transparency—do not impose a duty on the Chief of the Defence Force to determine the criteria and process for selection of judge advocates, meaning it will still rely on the willingness of the Chief of the Defence Force to utilise this provision. In addition, consideration of criteria such as diversity is discretional, as it only requires the Chief of the Defence Force to have regard to the desirability of reflecting diversity of expertise, experience and gender among the members of the panel. We understand the concerns that have been raised. However, we believe that transparency in the process of selecting judge advocates is important, so, while the change may not impose an obligation on the Chief of the Defence Force, it is still worthwhile to proceed with it.

In addition, the bill goes to transparency around termination: changes will also be made to clarify the termination provisions. Currently, there is no direct provision for the termination of judge advocates. Rather, they are subject to the same regulations as Defence personnel, which enable them to dismiss members if needed. These changes will provide for the termination of an appointment which is consistent with the standard provisions of the termination of statutory appointments. This is an important step in the right direction, ensuring that independence of the judge advocate is preserved. Concerns have been raised with regard to the termination provision in this bill as it still enables the Chief of the Defence Force to remove a judge advocate by terminating their appointment as an officer, essentially going around these termination provisions. While it's correct that this power does exist, the opposition believes that this provision will provide greater transparency around the termination of appointments than what currently exists. For that reason, we support the amendment.

Transparency matters—such as the criteria under which people are appointed, how long they are appointed for, how they are paid and how they are terminated—are important to ensure that there continues to be faith in the military justice system, and, as such, we support the changes in this schedule.

Schedule 2 will enshrine protections for reservists in the act by moving existing complaint mechanisms, investigations and mediation schemes for reservists into the principal act. Reservists are fundamental to maintaining Australia's defence capability, and help safeguard our security and national interests. Reservists provide support to the ADF, help rebuild following natural disasters, deliver humanitarian support overseas, and deploy alongside our regular ADF members in times of war. They are vital to our capacity and it is important that they are not disadvantaged by their participation in the ADF.

Currently, Defence reservists have a number of protections to assist with their civilian employment and education, and to mitigate some of the employment and financial disadvantages some reservists can face when rendering Defence service. Schedule 2 proposes moving these protections from the regulations into the principal act, as recommended by the Senate Standing Committee for the Scrutiny of Bills. These changes will insert a new division into the act based on the complaint and mediation scheme currently in the regulations. The scheme will be simplified and improved by these changes.

Some of these changes include reducing the prescriptive provision for complaint handling and investigation, replacing them with broad discretions of the Chief of Defence Force to deal with complaints and investigations. One of these changes relates to the investigation of complaints that would give the Chief of Defence Force the power to compel civilians and employers to provide information or documents; seek a civil penalty from a relevant court if a person fails to produce the information or documents; and direct a person to attend a conference and, if the person fails to attend, seek a civil penalty.

This element has caused some concern, as it has been argued it's uncommon to give the Chief of Defence Force power over civilians during peacetime. However, the government has advised the opposition that this power already exists in regulations for this act, and there are several examples in both acts and regulations where powers exist that enable the Chief of Defence Force to compel citizens during peacetime. These include the Defence (Inquiry) Regulations 2018, which compel both civilians and military members to provide documents or things that are relevant to inquiries; and section 86 of the Defence Act 2003, which can apply penalties if people fail to appear as required by a summons under the Defence Force Discipline Act 1928. In addition, the government has advised that this provision is for the Chief of Defence Force to exercise a statutory power and is not a use of his command executive powers that would give rise to any constitutional or other concern.

It is because of these assurances that Labor supports this element of the bill that moves regulations into the principal act. As a consequence of moving these provisions into the act itself, a number of the regulations will become redundant. Most of these are due to sunset later this year, but two of the regulations that are not moving into the act will need to be remade. These two remaining regulations deal with financial arrangements.

In addition, the amendments in this schedule will also require the Chief of Defence Force to prepare a report in relation to the administration operation of the act for inclusion in the Defence annual report. This is an important addition. Given the significance of the role our reservists play and the importance of the regulations that enable their participation, it is appropriate that this act be reviewed annually and a report be made public. I understand the Defence Reserves Association is in support of these changes and gives assurance around broader issues that have been provided by the government. Under those circumstances, Labor offers support to this schedule.

I would like to thank both the Australian Defence service associations and the Defence reservists for their examination and independent feedback of the proposed changes. In addition, I would like to acknowledge the assurances provided by the government in relation to judge advocates and the use of powers to compel civilians by the Chief of Defence Force which enable us to support this bill.

In closing, I will end where I started. I would like to thank all of those who serve our country. The service provided by approximately 83,700 members of the ADF and reservists, and all those family members who stand by them, is fundamental to the protection of our country and is appreciated by all of those in this place. I commend the bill to the House.

Mr WALLACE (Fisher) (12:08): I would like to thank the member for Kingston for the way in which she conducts herself in a bipartisan approach, generally speaking, in this important portfolio. This bill delivers on two things which I believe should be critical priorities for any national government: delivering fairness in our military legal system and looking after those who volunteer to serve our nation in the Australian Defence Force.

The ADF is full of dedicated, hardworking and professional people. I've been fortunate to meet many of them during my time in this place. I've taken part in a number of exchanges and activities under the ADF Parliamentary Program, including spending some time with our personnel in Afghanistan. As a member of the Defence Subcommittee of the Joint Standing Committee on Foreign Affairs, Defence and Trade, and in my work on the Parliamentary Standing Committee on Public Works, I've had further opportunities to work closely with our ADF personnel.

Our soldiers, sailors and air men and women are some of the best trained and most disciplined in the world. In any large organisation like the ADF, especially one which by its nature involves stressful work under pressure, individuals will occasionally make less than optimal decisions. Some people will fall foul of the rules, and when they do a court martial stands ready to assess the facts of the case and pass judgement. Although a court martial has special procedures most appropriate to the administration of military justice, it remains ruled by our society's core legal principles. One of the most important legal principles that underlies our justice system is the independence of our judiciary. To deliver fairness in legal proceedings, judges must be independent from the state's prosecution arm. It is that independence which helps to ensure the judiciary's impartiality, and impartiality is at the heart of fairness. In civilian life a judge has tenure. There is clarity of their remuneration structures and, at least in some jurisdictions, there is a transparent process in respect of their appointment.

The effect of schedule 1 of this bill is to enhance the independence of these processes in the military judicial structure to further secure fairness in the cases that come before it. The bill will increase the maximum term of appointment for members of the judge advocates' panel, who sit as Defence Force magistrates and provide legal advice to court martial members, from three years to five years. It will also provide for the Chief of the Defence Force to set selection criteria and processes for the appointment of judge advocates to the panel in a notifiable instrument. This will support a more open selection process, providing transparency for all in how candidates apply and how they are assessed.

The bill also ensures that remuneration for judge advocates when acting during a court martial is determined by the remuneration tribunal rather than by the ADF, ensuring that judge advocates do not depend on the chain of command for their pay. This will bring the process of setting remuneration of judge advocates in line with the process for the Registrar of Military Justice and the Chief Judge Advocate, ensuring consistency and clarity as well as maximising their independence. The rules and procedures of these courts are set by the Judge Advocate General, who is supported in their work by the Chief Judge Advocate. Once again, this bill makes similar provisions enhancing the independence of that position. The bill provides for the Judge Advocate General to lay out, in a notifiable instrument, the selection criteria and process for the role. It provides for more-robust processes for the termination of the Chief Judge Advocate where necessary, which are consistent with the standard provisions for termination of statutory appointments.

Taken as a whole, the amendments in schedule 1 will bring greater guarantees of fairness to the military justice system. They are part of this government's growing track record of bringing greater fairness to all aspects of our national policy making. We have brought fairness to our taxation policy, eliminating bracket creep for low- and middle-income earners and cracking down on multinational taxation avoiders. We've brought greater fairness for vulnerable workers, passing legislation to punish employers who exploit them and banning dodgy deals between employers and unions. We've brought greater fairness to industrial relations, reinstating a tough cop on the beat in the construction sector and reducing exploitation of workers by the criminal CFMEU. We have increased fairness in the distribution of GST with a more equitable and sustainable funding formula and greater fairness in medical treatment, listing an additional 1,900 medicines on the Pharmaceutical Benefits Scheme.

The contrast with the Labor Party and the Leader of the Opposition is stark. While we've introduced fairer taxes, the Leader of the Opposition wants to slug retirees with a huge new multibillion-dollar tax. He wants to ensure that high-income earners on $200,000 a year can get a refund on their franking credits, but a self-funded retiree who has done the right thing and saved for their future will get nothing. While we've introduced fairer taxes for small businesses and more opportunity for society's vulnerable jobless, Labor's tax plans threaten 1.4 million workers' jobs and will undermine the investment decisions—

The DEPUTY SPEAKER: Order. The member for Scullin on a point of order?

Mr Giles: The speaker might turn his remarks to the bill. We will give him some leeway. I note that he started off with a plea for bipartisanship. The last several minutes have had no relation to the bill which is before the House.

The DEPUTY SPEAKER: I give the call to the honourable member for Fisher.

Mr WALLACE: It is perhaps no surprise from this Leader of the Opposition. The workers at Clean Event and Chiquita Mushrooms learnt all about what this Leader of the Opposition thinks is fair—

The DEPUTY SPEAKER: Order! Member for Scullin?

Mr Giles: Mr Deputy Speaker, you should direct him, if you will, to confine his remarks to the bill before the House.

The DEPUTY SPEAKER: The member for Fisher will be relevant to the topic.

Mr WALLACE: So while schedule 1 of the coalition government's bill will support greater fairness in the administration of our military justice, schedule 2 will improve fairness and security in the treatment of reservists who render defence service.

Reservists are a vital part of our Defence Force and are commonly required to interrupt their lives and their employment to go on active duty alongside regular service men and women. I met a number of the most amazing, dedicated reservists who had given up nine months of their lives and served their country in Afghanistan. I met neurosurgeons, emergency medicine specialists, dentists, lawyers and a chaplain—to name just a few. Often in the process of rendering this service these men and women sacrifice career opportunities as well as their personal lives, and existing legislation provides them with some critical entitlements and protections to mitigate some of the impact of these sacrifices. However, unfortunately, sometimes reservists may not feel that those entitlements and protections have been complied with and complaints sometimes arise. In fact, in 2017-18 there were some 1,400 inquiries of this nature.

I recently had a discussion at one of my listening posts with a retired reservist—I'll call him Tim—who served in the Solomons. Tim felt that a number of his needs weren't being properly met by the DVA, and I undertook to look into that for Tim. Tim personifies what being a reservist is all about. He has a common day job but has served his country in the Solomon Islands and other places where he experienced some graphic and very unfortunate circumstances which stay with him every waking moment of his life. This bill will go some way to improving the reservist complaint process. I want to give a shout-out to Tim and thank him once again for the service that he has given this country.

This improved complaint process makes the handling of complaints the responsibility of the Chief of the Defence Force, ensuring that accountability for looking after reservists lies with the ADF's most senior officer. The bill provides the Chief of the Defence Force with the necessary powers to investigate complaints of this kind and, indeed, any suspected breach of the relevant act, including the power to give notices to produce information or documents. The bill further provides the Chief of the Defence Force with the flexibility to deal with complaints in the most appropriate manner. In particular, it broadens the ability of the Chief of the Defence Force to deploy dispute resolution services other than formal mediation and gives them the power to compel parties' attendance at a conference to facilitate discussion.

These powers will help ensure that complaints are dealt with as quickly, fairly and efficiently as possible and, by extension, that as many reservists as possible get good employment outcomes following their active service. This is only the latest in this Liberal-National government's strong track record of delivering support for transition and future employment for those who have served in our armed forces. In total, in the most recent federal budget the government committed more than $11 billion to provide the essential services that our veterans rely on. This is accompanied by a substantial package of reforms. We've instituted a policy of no discharge without documentation, for example, to ensure ADF members are prepared for civilian life and future employment with all the documents they need, including medical and training records, to make transition as seamless as possible. We've delivered an extra $8 million for the Prime Minister's Veterans' Employment Program, which includes a new veterans employment commitment to which businesses can sign up. This program will help veterans to identify employers who are likely to support them and will reward employers for their insight. To help further, we've established individual professional career coaching for ADF members prior to and up to 12 months following separation from the ADF.

Employment prospects for veterans can often be improved by further education. We've allocated $10.8 million to remove the reduction in the amount of incapacity payments which eligible veterans who are undertaking approved full-time study as part of their rehabilitation plan receive. There's much more to be done in this space, and I'll continue to encourage the government to examine ways that Australia can look at adopting a US-style GI bill.

Employment outcomes for veterans can also be significantly impacted by their mental health, and we've taken action to support them in this regard. The coalition government has made mental health treatment free of charge for anyone who has served at least one day full time in the ADF, whatever their mental health condition, and whether or not the condition is related to their service. We're funding a coordinated veterans care program for mental health, which will support up to 250 DVA clients living in rural and regional areas who have mild-to-moderate anxiety or depression, alongside a chronic physical condition accompanied by pain. In total, we've committed an extra $89.6 million to support veterans' mental health, including $16.1 million for a new veterans payment for financially vulnerable veterans living with a mental health condition; $9 million to pilot new approaches to suicide prevention; and $7.1 million to extend support to families of veterans. To administer all of these programs we have provided an additional $100 million in the 2018 budget, on top of the $166.6 million last year to support the coalition government's improvements to DVA, upgrading internal computer systems and making sure we have faster and better service delivery to people when they need it.

There are an estimated 15,000 veterans living on the Sunshine Coast, and I'm absolutely passionate about ensuring we support our armed forces—both those who are serving and those who have served. In my own electorate of Fisher I've introduced a Fisher defence industry initiative to try to support new employment opportunities for former service men and women on the Sunshine Coast. I've held a local veterans forum, instituted a Sunshine Coast Veterans Day and advocated in this place for more support for veterans' tertiary education.

I believe this bill, though modest in its effect, will make important changes to the administration of military justice and the handling of reservists' complaints, which will see greater fairness for all ADF personnel. For that reason, I commend the bill to the House.

Ms O'TOOLE (Herbert) (12:23): I have made it known in this place many times that I am proud and honoured to represent the largest garrison city in Australia. But the recent extreme weather event in Townsville has demonstrated to me just how amazing and committed our community of ADF are to the people of Townsville, and that is just another reason why I am honoured to represent the ADF constituents in Herbert.

Townsville has experienced our worst flood event in history. It's being called a one-in-1,000-years event. In fewer than nine days Townsville received more than a year's worth of rain. More than 22,000 homes were affected, and 110 roads were also affected. The ADF played a major role in ensuring that lives were not lost in this catastrophic weather event. The men and women of the ADF doorknocked thousands of homes, advising residents that they were in a flood zone and would need to evacuate their homes. They spent evenings rescuing residents from the sudden wall of water that would flow from the dam and also the rain that was falling. Our dam had reached a capacity of 244 per cent. Our ADF personnel put their own lives at risk to rescue Townsville residents, and they did so when many of them were not able to even protect their own homes. An estimated 100 Defence personnel were affected by the floods. A newspaper article said:

LANCE Corporal Daniel Hyman of the 2nd Cavalry Regiment is one of the many Townsville based personnel who helped residents evacuate as their own homes were inundated.

Displaced Defence families were being housed in evacuation centres as their loved ones worked—

to save and help other residents. The article continued:

LCpl Hyman said the ordeal has been physically and mentally taxing but was proud of the Army's efforts.

"I put it to the back of my mind and tried not to think about what was happening … there were people who needed our assistance more, so we had to put our stuff aside so we could help the community," he said

"I was very happy that we were out there to help our community, we put the community first."

However, the ADF's amazing efforts have not stopped there. Since the devastating flood, ADF personnel have spent every single day assisting in the clean-up, making their way through mountains of smelly mud, walking through sewage, removing the mountains of damaged furniture from people's homes and assisting with the disposal. Their efforts have helped Townsville residents and have been vital in helping Townsville get back on our feet. In this place, it's important that we acknowledge their amazing work. I want to sincerely thank all of our current serving Defence personnel and their families. You looked after Townsville, and I will work hard to ensure that you and your families are looked after also and to assist you to get back on your feet.

I am proud to support the Defence Legislation Amendment Bill 2018 in the House today. This bill amends the Defence Reserve Service (Protection) Act 2001 and the Defence Force Discipline Act 1982 to help improve transparency, ensure protections for reservists and clean up some redundant provisions.

Schedule 1 will enhance the independence of judge advocates and provide greater transparency in the selection of judge advocates. Judge advocates are senior military legal officers appointed by the Chief of the Defence Force or a service chief following nomination by the Judge Advocate General. They may be appointed as the judge advocate of a court martial, assisting court martial members with the application of military law. Alternatively, they may be appointed as a Defence Force magistrate to try charges referred to them by the Registrar of Military Justice. Members of the judge advocates panel are central to the proper operation of the superior service tribunals in the military justice system. The amendments made in this section will ensure transparency in the selection of judge advocates and greater independence when it comes to their remuneration. Under these changes, members of the judge advocates panel will have their remuneration determined by the Remuneration Tribunal, establishing an independent process to determine their pay. In addition, the selection criteria will be established by a notifiable instrument, providing greater transparency in the selection and termination of their appointments.

Schedule 2 moves existing complaint mechanisms, investigations and mediation schemes for Defence reservists from the regulations into the principal act. Defence reservists are afforded a number of protections in their civilian employment and education, mitigating some of the employment and financial disadvantages that reserve members may face when rendering Defence service. Reservists are fundamental to our capability, and we should be doing all we can to ensure that there are no barriers to their participation in the ADF. The amendment will insert new divisions into the act based on the complaint and mediation scheme currently in the regulations. The scheme will be simplified and improved by these changes.

The final schedule makes a number of minor technical amendments, most of which relate to redundant and repealed provisions. For example, the amendments will update the definition of 'prohibited drug' to reflect other legislation and provide for court martial records to be disclosed by the Registrar of Military Justice rather than the Attorney-General. Given the technical nature of these changes, I offer my support to this schedule.

I have spoken in this place on every single Defence or veteran bill because our current serving and ex-serving veterans and their families deserve the strongest representation and assurance that they have a member who stands up for them in this place. I stand here again today, as I have done many times before, to support a bill that supports our Defence personnel. Once again, I thank the men and women of the ADF for the outstanding contribution they have made in Townsville in recent events.

Mr CHESTER (Gippsland—Minister for Veterans' Affairs, Minister for Defence Personnel, Minister Assisting the Prime Minister for the Centenary of ANZAC and Deputy Leader of the House) (12:29): In summing up, I would like to acknowledge the honourable members who contributed to the debate on this bill, acknowledge the bipartisan support shown in the second reading debate, and also acknowledge the member for Herbert's contribution in particular, in relation to the contribution our Australian Defence Force personnel have made in response to the Townsville flooding event. The efforts of our serving men and women have been nothing short of extraordinary. Lives have been saved as a direct result of their intervention. Their efforts during the response phase and now the recovery phase have been commended right across our country, and we're very proud of them. We are also particularly proud of their families, many of whom have themselves been exposed to flooding and have had to deal with their own situations while their serving member of the Defence Force has gone out to protect the community. It has been quite an extraordinary effort.

The Defence Legislation Amendment Bill 2018 has three separate measures. The first measure amends the Defence Force Discipline Act 1982 to ensure greater transparency in the selection of the members of the judge advocate's panel and to enhance the independence of judge advocates. The second measure amends the Defence Reserve Service (Protection) Act 2001 to move the complaint, investigation and mediation scheme from the regulations to the act, whilst simplifying and improving these processes. The third measure also amends the Defence Force Discipline Act, making number of technical, flow-on and minor amendments.

In conclusion, this bill moves to make some small but significant changes to Defence legislation. I commend the bill to the House.

Question agreed to.

Bill read a second time.

Mr CHESTER (Gippsland—Minister for Veterans' Affairs, Minister for Defence Personnel, Minister Assisting the Prime Minister for the Centenary of ANZAC and Deputy Leader of the House) (12:31): by leave—I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Mr GILES (Scullin) (12:32): I rise to make a contribution to the debate on the Tertiary Education Quality and Standards Agency Amendment Bill 2018. This bill proposes a range of minor and technical changes to the operation of the Tertiary Education Quality and Standards Agency, TEQSA. These are to give effect to aspects of the government response to the 2016 Review of the impact of the TEQSA Act on the higher education sector that require legislative endorsement. I note that this review is the first substantive review of the agency, although, of course, the Lee Dow-Braithwaite review initiated and responded to some sectoral concerns about the scope of the activities of the agency.

Labor will not be opposing this bill and are supportive of the measures contained within it. I will be proposing a second reading amendment which goes to some other aspects related to the bill and the government's higher education policy. It was Labor that created the national regulatory system in higher education back in 2011, which was an important part of our response to the Bradley review. I'm sure my friend the member for Lingiari well remembers that and appreciates its significance. Labor in government recognised then, as we do now, that if we want to expand and strengthen higher education in Australia then we need a national approach to regulation that is fit for purpose today and tomorrow. While this system develops and evolves, Labor continue to recognise that there will be a need for periodic review of the operation of this agency to ensure that its structure is fit for purpose as the sector continues to develop.

The changes proposed in the review and incorporated into this bill before the House now are really under three broad headings. The changes include simplifying the Higher Education Standards Framework, and changes to the operations, functions and skill base of the Higher Education Standards Panel within the agency—this is to broaden the skill base and also require contemporary experience in higher education across both universities and non-universities. It also includes a range of measures that are updates to rules around disclosure of information, largely to ensure consistency with other provisions.

The proposals in this bill come from a review initiated by the government, as required by the substantive act. This was more than three years ago. It is difficult to see why the government have hastened so slowly. It really speaks volumes about their chaotic approach to governing and their neglect of this critical sector under three ministers. It has taken them well over three years since the review was completed to present this legislation to the parliament. To members opposite, this is clearly not the priority it should be, as it is to this side of the House. I say again that these changes are supported by Labor and by the sector, although I do note that some minor concerns have been expressed, particularly by Universities Australia. I make clear that we are paying careful attention to them as we consider the ongoing operation of the agency. These concerns, as I said, are minor and technical.

More generally, the sector has made clear its deep frustration with the government, for good reason. It is little wonder the higher education sector has had enough of this government. Since they've come to office, they have done nothing but undermine Australia's world-class higher education system. Instead of fostering our universities and all that goes on within them, all we've seen are cuts and chaos. But, worse than that, we've seen no plan—no plan for this vital export sector; no plan for this critical enabler; no plan at all. Billions of dollars have been cut. Undergraduate places have shamefully been capped. They've made students pay back their HELP debt sooner and millions of dollars have been slashed from university research funding, despite rhetoric to the contrary. Consequently, I move:

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

"whilst not declining to give the bill a second reading, the House notes that the Government has damaged the quality of Australia’s world-class higher education system, having cut billions from universities by effectively capping undergraduate places, and slashing research funding".

Labor knows that, if we are to fully realise the potential of all Australians—young Australians and those who are older—and seize the opportunities presented to us as a nation by the Asian Century, we need to invest deeply in higher education and research. That is a bigger challenge than that contained within the provisions of this bill, but the deputy leader, the shadow minister for education, and all of us in the Labor team are up for this challenge.

As the world becomes more technologically advanced, we need to ensure that we are at the forefront of these changes and that our education system remains responsive. Part of this challenge is, of course, having an adaptive and appropriate regulatory system, but obviously it goes much beyond that. Unlike most of the major economies in our region that are investing in universities, science and research, this government have been doing precisely the opposite: ripping money out of our universities, starving them for funds and starving our brightest Australian researchers of opportunities and the confidence to pursue careers in higher education. This is short-changing their potential and it is short-changing all of us as a nation. We know, on this side of the House, that this is going to do long-term damage to our economy as well as to our society. It's going to impact very, very significantly on the aspirations of thousands of Australians who will miss out on university places because of these cuts. As I said, it will impact on the capacity of others who have entered higher education to continue to flourish, develop their skills and pursue research excellence in the university sector. The last Mid-Year Economic and Fiscal Outlook demonstrated just how chaotic the government has become and the serious consequences of that for this sector. They have left so many regional universities in a dire state with the cuts.

Let's remember, they were forced to rip hundreds of millions of dollars from university research in order to allocate additional places to some regional universities. This is robbing Peter to pay Paul and it is absolute errant nonsense. If members opposite really wanted to ensure that Australians, particularly those in regional and outer-metropolitan areas, have the opportunity of a university education, they should follow Labor's lead and return to a demand-driven system. Labor knows that we need to boost participation in higher education in order to meet the needs of our future economy as well as to respond to the trend towards inequality, which members opposite seem determined to accelerate. Let's remember that this is not just rhetoric on our part. That is what we have done, when it comes to higher education, since the government of Gough Whitlam, since reforms carried out under the Hawke and Keating governments, particularly on this point of the demand-driven system that boosted opportunities in universities—and in life—for so many first-in-family students under the governance of Kevin Rudd and Julia Gillard.

That's why we have committed, again, to uncapping undergraduate places—a huge $10 billion commitment—over the next decade. We have expressed our values clearly through the depth of our financial commitment to supporting the aspirations of young Australians, particularly those who are first in family. We have also made sure that we are underpinning a vision for Australia's economy with an approach that is all about inclusive growth, not the narrow, blind, ideological insistence on trickle-down economics that is failing Australia and failing too many Australians today.

We also want to do more to ensure that students from disadvantaged and underrepresented backgrounds get the opportunity of a university education. We will support them not just through words said in this place but through a real investment, our $174 million equity and pathways funding program. We know that, fundamental to our vision of the Australian economy of the future and a fairer Australian society for the future, is our appreciation that nine out of 10 jobs created by 2021 will require either a degree or a VET qualification.

We recognise that it is imperative to boost participation in universities as well as TAFE and apprenticeships. According to the Mitchell Institute, if the government doesn't lift its caps on university places, around 235,000 students will miss out on a place by 2031. This is absolutely shocking and an indictment of a government that has been asleep at the wheel under Minister Pyne, Minister Birmingham and now Minister Tehan. The numbers are even worse when it comes to vocational education. Quite frankly, it is a recipe for disaster.

In finishing my contribution to this debate, let me emphasise that Labor has a better and positive plan across all education sectors. We will support the measures contained in this bill today, but beyond that we will do so much more. We will properly fund our universities, with three-year funding agreements guaranteed, so they can plan with certainty. We will uncap university places so that 200,000 more Australians will get the opportunity of a university education in the next decade or so. We will invest in university research and infrastructure with our $300 million university future fund.

We will introduce—and this is absolutely vital at the other end of the education spectrum—universal places for three- and four-year-olds in early childhood education, a fundamental building block to an equal society, as well as equal participation in higher education down the track. I'm particularly proud that we will invest $14 billion extra in our public schools, those schools that educate two in three, or 2½ million, Australian kids.

We will waive up-front fees for 100,000 students to attend TAFE and invest $100 million in modernising TAFE facilities around the country. We will go further than this, when it comes to skills, by ensuring that one in every 10 jobs on Commonwealth priority projects are filled by Australian apprentices. We will provide 10,000 pre-apprenticeships for young people who want to learn a trade and will provide 20,000 adult apprenticeships.

It's very clear when you look at this plan—and at the gulf, the void, on the other side of the House—that Labor is the only party Australians can trust when it comes to education.

The DEPUTY SPEAKER ( Mr Vasta ): Is the amendment seconded?

Mr Snowdon: I second the motion and reserve my right to speak.

The DEPUTY SPEAKER: The original question was that this bill be now read a second time. To this the honourable member for Scullin has moved as an amendment that all words after 'That' be omitted with a view to substituting other words. If it suits the House, I will state the question in the form that the amendment be agreed to. The question now is that the amendment be agreed to.

Mr BANDT (Melbourne) (12:44): I rise to speak to this Tertiary Education Quality and Standards Agency Amendment Bill 2018; and to the second reading amendment, which talks about how we should fund education and places that should be available and how we should have world-class research.

I want to remind the House that there was a time when university was free. Many of the politicians in this place are from a generation that received free education and graduated without debt. They went on, though, to reintroduce fees for university and saddled a generation with repayments.

People entering university today are facing a totally different reality, and young people are getting screwed over. If you're a young person you enrol in university or TAFE because you're told it's the pathway to a good job and to personal growth that will let you make a contribution in our community. You enrol for possibly years of study. Throughout this time, the fees, or HELP payments, keep building up, and your debts keep growing. Class sizes are growing, and teaching staff are increasingly stretched because of government cost cutting. You have to work long hours while you study, because you have to pay rent or other costs, and Austudy is low, and youth allowance is low and hard to access.

Then, when you finish studying, thousands of dollars in debt, you get told: 'Sorry, but you don't have enough experience to get a job. You're going to have to study more. You're going to have to market yourself to employers and take on unpaid labour just to get your foot in the door.' Just don't rely on Centrelink, though, when you're seeking work, because Newstart is below poverty levels and you might be issued an incorrect robo-debt. And you get told that it's your fault that the housing system is broken and that the reason you can't buy a home is cafe breakfasts—not the unfair system that helps investors buy their fourth, fifth or sixth home to rent to you at inflated prices. And by the way: not only do you have to pay off your debt, not only can you not afford a secure home, and not only will you be working casual hours in precarious jobs or taking on side hustles, but you're also going to live in a world with a hotter climate and more-extreme weather, and you're going to have to lead the fight against big coal because the last generations of politicians failed and left it to you.

This is what happens when government stops seeing education as a fundamental right and starts seeing it as a business. Australian governments over decades—Liberal but also Labor—gave into neoliberalism, and this generation of young people now is paying the price. We accept in our society that schools and hospitals should be free and universal. You can receive health care and secondary education no matter what your bank balance is—and that is one of the good things about this country. It would be a scandal if we were forcing people into debt to access these rights. But that is what is happening with TAFE and university. This is one of the reasons I got into politics in the first place. My dad was the first person in his family to go to university, and he was able to do it because it was free. When I was at university I got involved in the education campaigns, against a then-Labor government, because you could see the cost of education going up and up and up, and people being put into such debt that people like my dad might not have been able to go to university and might not have made the decision to go there in the first place.

That is why I am proud to be part of a party—the Greens—that have a plan to bring back free university and TAFE education. We will make TAFE and undergraduate uni free, and we'll pay for it by making the fossil fuel industry pay its fair share. No more unfair tax breaks, no more right to pollute for free; just start making them pay the same tax as everyone else on things like diesel fuel in the mining industry, and you will find that we have the money to pay for things like free education. We can increase youth allowance, Austudy and Abstudy by $75 a week so that students can get by while studying. Let's lift youth allowance by $75 a week. And we'll fix the government cuts that led to stretched staff and teaching. We have to boost university funding by 10 per cent per student. This bill talks about education quality. The only way we're going to restore quality back to the world-class level that so many of our institutions were at is by boosting university funding by 10 per cent per student. That call has been out there for many years. The first real funding increase for universities in decades, this would improve learning and teaching conditions, would reduce class sizes and would enable researchers to pursue solutions to the big problems of our time, because for too long universities have been asked to do more with less.

It has been decades since the last real increase in funding to universities. Our plan delivers an extra $16 billion over the next decade for universities to improve learning and teaching conditions, reduce class sizes and give researchers the resources they need. Importantly, we will work with universities to reduce casualisation in the sector and to reduce job insecurity and improve staff working conditions. Government must also link additional funding for universities with an increase in security of work for university staff. We must reverse the decades-old trend of casualisation and insecure work.

People have this idea that somehow universities are places where everyone has tenured positions for life. Well, you're looking at less than a third of people who work in universities at the moment enjoying that security of ongoing employment, which should be a right. People working in research, academia and teaching are facing the pressure of successive governments' failure in this area and the neoliberalisation of higher education and research. I know this, and I see it on a daily basis, because my electorate is home to major universities and research institutions. I have spoken to too many people in Melbourne who've always dreamed of working in research and teaching, and who've worked hard their whole careers to get there, who are feeling the pressure of competitive grant applications for a diminishing pool of funding, administration, growing workloads not related to their core research, casualisation and the insecurity that comes with not knowing whether you're going to have a job after the next grant round.

We looked into this a couple of years ago. I introduced a bill into this place to wind back casualisation in our workforce, with a special focus on the university sector—a bill that, at the time, didn't get the support of either Labor or the Liberals, but I'm hopeful the tide might turn on that. When we introduced that bill and had an inquiry into it, we heard from a woman who had worked for 10 years in the same area and for the same institution but had not been entitled to a period of sick leave or long service leave during that time because she was on rolling contracts and treated as a casual. This must stop.

We are always going to have universities, and we will have better funded and more jobs in those universities if we lift funding. Because we're always going to have universities, people there should have greater rights to secure employment. Good people at the moment who are experts in their field or on the way to becoming experts in their field are being pushed out of research because of the insecure conditions and lack of funding in Australia.

The tragedy is that this is entirely preventable. It's a consequence of government decisions to cut costs and to treat research and universities like money-making businesses instead of something contributing to the public good. If only, for example, we could say to universities: 'You don't have to spend more money advertising on billboards or the side of trams, trains or buses. You can put that money into research and teaching, because we're not going to make you compete against each other. Instead, we're going to encourage collaboration.' Most staff around the country would breathe a sigh of relief. The advertising companies might get a bit worried about it, but that money could go back into supporting staff and students.

Let me say it clearly: education is not a product, students are not consumers and university is not a factory. The Greens will fight for free education and a thriving research sector. I'm proud that we're putting free education on the agenda, and I believe that sooner or later the other parties will follow us as they have on so many other issues. I call on everyone in this place to get serious, join us and back the plan to push for free education in Australia again.

Mr DICK (Oxley) (12:53): I rise to enter the debate and speak on the Tertiary Education Quality and Standards Agency Amendment Bill 2018, and strongly support the amendment moved a short time ago by the member for Scullin. For a long time, Australia's higher education has been world leading. Can I say at the outset that my Labor colleagues and I support this bill because it helps to keep Australia's higher education system as a world leader. Students come from all over the world to further their education on our shores with some of the best universities, professors, researchers, tutors, support staff and administrative staff anywhere in the world. Our universities support more than one million students, both international and domestic, and our universities directly employ 120,000 people and support another 40,000 jobs.

On this side of the House, Labor has a long record of standing up for our universities. I listened to the member for Melbourne prattle on about the Greens' achievements. He had the hide to talk about free education. It was a Whitlam Labor government that introduced free education. We know in Australia, when it comes to higher education, this side of the chamber has a proud record and, indeed, custodianship of supporting education at every level across our country—investing in students, courses and research so that Australia can become a world power when it comes to higher education. This is where we educate the next generation of doctors, engineers, teachers and entrepreneurs.

A strong, stable and future-focused higher education industry is what Australia needs. That's why, in 2011, the Gillard government established the Tertiary Education Quality and Standards Agency. It's Australia's independent national quality assurance and regulatory agency for higher education to safeguard student interests and the reputation of Australia's higher education sector. At the time, Prime Minister Gillard said that the TEQSA will be at the heart of bolstering our reputation by ensuring quality for all students, domestic and international students alike, because that is what good governments do.

Good governments support our higher education sector. Good governments back students, teachers and universities. This is in stark contrast, as we know, to what those opposite have delivered for our universities. The second reading amendment moved today by Labor's shadow assistant minister for schools, the member for Scullin, notes that we do, and should, recognise that:

… the government has damaged the quality of Australia's world-class higher education system, having cut billions from universities by effectively capping undergraduate places, and slashing research funding.

Make no mistake, this government has taken a wrecking ball to our universities and our higher education system, with $2.2 billion in cuts since they came to power. That's a simply staggering number that means our universities will be under-resourced and our students will miss out on the vital education they need to succeed in the fast-moving 21st century.

When Labor was last in office we lifted the caps on the number of uni places—which saw, in my electorate in Oxley, huge increases in the number of students going to university. But we've seen the complete opposite from this government. Their $2.2 billion axe to our universities means that 9½ thousand Australians missed out on an Australian university place in 2018 and another 9½ thousand will miss out again in 2019. This is just unacceptable. We must be supporting and investing in our universities, rather than gutting the institutions that will guide the next generation of scientists, doctors and teachers.

Here's what the cuts by this government and this Prime Minister mean for universities in my home state of Queensland: the University of Southern Queensland, who have a campus in my electorate, are facing $36 million in cuts; Griffith University is facing a cut of $92 million; the Queensland University of Technology is facing a cut of $100 million; and the university that I attended, the University of Queensland, is facing a $100 million cut as well. That is ironclad evidence that this government does not care about students in this country going to university and receiving a higher education. We know this because they have a track record of tearing down our universities. They have repeatedly attacked higher education, year after year.

When this government was first elected there was a 20 per cent cut and full fee deregulation, as we've heard, which would have seen $100,000 degrees. In the next iteration they wanted to hike up fees by 7½ per cent, have a commensurate cut in university funding, have a further cut to university funding and then drop the HECS repayment threshold down to as low as $42,000. This is barely more than the minimum wage. It would mean Australians on low incomes who have a HELP debt would be required to make huge repayments. This change would also have a greater impact on women, particularly those who return to the workforce part-time after taking parental leave.

I have to wonder if those opposite are aware of where Australia currently sits in public investment in universities in the OECD. Are we near the top? We're not even close. Are we about mid-range? Absolutely not. Australia has the second-lowest level of public investment in universities in the OECD, and this government only wants to make it worse. At MYEFO last year they went after research, ripping $328.5 million from university research, which will devastate our critically important research sector.

I might also add that this government's attacks on TAFEs and apprenticeships are appalling. We know that since the government came to power Australia has lost over 140,000 apprenticeships, a decline of over 35 per cent. I speak about this a lot when I move around chambers of commerce, high school graduations and even local businesses. Locally, the apprentices in my electorate have been hit even harder. Our community has seen a loss of almost 1,500 apprenticeships, which is equivalent to a 43 per cent decrease and the signs are that this will only continue to get worse. The 2017 budget cut a further $637 million from TAFE training and apprenticeships. And their proposed Skilling Australians Fund, supposed to deliver 300,000 apprenticeships, has been widely panned as unworkable.

The evidence continues to stack up that this government does not take higher education seriously, which brings me to the finer points of this bill and the government's incredibly slow response to implement the recommendations from the review into the TEQSA. I shouldn't be surprised. This slow response is in line with everything else that they've done to higher education in this country, and that is to cut it down. The review, undertaken by Deloitte Access Economics, was undertaken between July 2016 and March 2017 and was a substantial body of work. Thirty-six written submissions were received, 33 stakeholders were interviewed and the act was extensively analysed. Overall, the review was positive about the establishment of TEQSA as the national regulator noting that, 'Broadly… the Act is operating effectively and as intended.' Therefore, the review did not recommend changes that would significantly alter the regulatory framework or its role.

However, the review did recommend amendments to the act that are designed to improve the act's administration, strengthen the regulatory role and better reflect the role of the Higher Education Standards Panel as the statutory advisory body established under the act. I want to go through those recommendations now. They are to simplify the Higher Education Standards Framework by removing references from the act to specific categories of non-threshold standards that have never been made and are not needed and expanding the skill set that the minister must ensure is encompassed by panel members, so that the panel has contemporary experience in the provision of higher education by both university and non-university providers.

However, the general positive outlook from the review should not mask this government's lack of attention to it. We know where they have been focusing all attention lately, and of course you only need to pick up a newspaper to realise that the government is focused on themselves first, second and third. As we know, the chaos and dysfunction of this government is unrelenting and grows on an almost daily basis, whether it be in this chamber, outside in their party room or outside in the community. We know that they have basically given up on governing, but there are so many important pieces of legislation that this government has decide not to turn up for. We know that this important work must continue. The recommendations in this bill were given to them years ago, yet here we are debating them now. The only thing this government has been doing in that time is tearing down the higher education system in this country and, let's be honest, tearing down themselves. The fact is that when you look at the Notice Paper today not one member of the government is actually speaking on this legislation, on the government's bill.

We know that the Australian public deserve a lot better, but there is an alternative. We know that when it comes to higher education and general education this side of the chamber does believe in the best for our students. That's why in the time remaining I want to focus on the alternative positive plans that the Australian community are crying out for, including the announced National Inquiry into Post-Secondary Education. This is a once in a generation national inquiry that will look at every aspect of the vocational and higher education systems to ensure that they can best respond to the needs of the Australia's economy and society.

I want to place on record that this is the first time that a national inquiry has put TAFE and unis on an equal footing. It is about making sure that Australians have access to the best post-secondary opportunities in the world. We want our kids to get the education and skills they need to thrive and to make sure that all Australians have the opportunity of lifelong learning. If as a country we are to continue to be a wealthy and highly educated nation, we must boost participation in quality postsecondary education. It's clear when you look at the evidence—it's not a term that this government likes to use too much of the time. Experts have warned that, if we rest on our laurels or continue with the cuts from this Morrison government, Australia risks being left behind.

On this side of the House, we know that. Labor knows education at all levels is key to the future of prosperity and key to a stronger community. That's why we will properly fund our universities with three-year funding agreements, guaranteed; uncut university places so that 200,000 more Australians will have the opportunity of a university education over the next decade or so; invest in university research and infrastructure with our $300 million university future fund; and provide more support for disadvantaged and underrepresented students to get the confidence and skills they need to get into university with $174 million for equity and pathways funding.

One of the greatest joys that we have as members of parliament is to attend school graduations. One of the greatest joys we have is to participate in those school graduations. Being in parliament, you don't always get to visit every single school in your electorate. I have approximately 53 schools in and around the Oxley electorate. I visit high schools and I see kids from non-English-speaking backgrounds, from migrant families—kids who started perhaps at Inala State School in my electorate and had little English. I see those students go on, whether they be from Somalia, South Sudan, Vietnam or Malaysia. When I see those kids graduate—and they not only graduate but are dux of their schools and have done early entry university courses or will be going to post-trade or secondary education—they have a look of pride. They're the people who we need to always be remembering—those kids who perhaps have had it a little harder but who are just as smart and just as talented as any other student at that school.

Sadly we've seen this government not investing in those students. Sadly we've seen this government remove the access and equity to higher education, remove the pathways. That's why I'm such a strong supporter of what the Leader of the Opposition and the deputy leader have announced with $174 million to improve equity and pathways funding. We need to be lifting people up wherever we can. To all those students who I have witnessed and the tens if not hundreds of thousands across Australia who are doing it tough and perhaps have just gone back to school in the last week or so: I want you to be very clear that we on this side of parliament will support you, we will invest in you and, more importantly, we value you.

We know a Shorten Labor government will invest across the whole education sector, whether it be by universal accessibility to early childhood education for three- and four-year-olds or investing a vital $14.1 billion of extra funding in our schools. We'll waive up-front fees for 100,000 students to attend, we'll provide 20,000 adult apprenticeships and we'll provide 20,000 pre-apprenticeships for young people who want to learn a trade. This is how a government should support education. We will continue to invest in and support education because we know it is the right thing for our country, for our economy and for the future of our nation.

Ms RYAN (Lalor—Opposition Whip) (13:08): I stand here as someone who formerly spent 27 years in state education, in high schools and primary schools in Victoria, someone who spent many years in a role as a secondary year level coordinator, who worked with young people year in, year out not only in their classrooms as an English teacher, a drama teacher and a history teacher but also as a coordinator working with young people from year 7 through to year 12 to build in them an aspiration to gain entry into university or, if that was not going to be the case, an aspiration to attend TAFE and to build in them an understanding that we need to be lifelong learners. So it is with absolute pleasure that I rise to speak today on the Tertiary Education Quality and Standards Agency Amendment Bill 2018 and to support the amendment moved by the member for Scullin. It was Labor in 2011 that established TEQSA as the national regulator of Australia's higher education system, so I'm happy to speak today on the importance of government support for our education system at all levels but particularly at the university level.

Support of our education system is something that is foreign to the Abbott-Turnbull-Morrison government, as we have seen across the last five-plus years. The fact that we are only debating this bill now, three years after the recommendations from the review of TEQSA were provided to the government, speaks clearly about this government's attitude to universities and its responsibilities in responding to reviews and ensuring that we have the best system possible. It demonstrates just how much this government doesn't value our higher education system. I'm not surprised, and why should I be when all we have seen from this government is cuts and chaos in this space?

Let me be clear. After the government were elected in 2013, students were placed under attack with the threat of university fee deregulation. Those of us on this side fought the government on that war, and we won in support of young people across the country, joined by those people who were seeking to retrain, seeking higher education or seeking to rejoin education as a way of ensuring that they had a bright economic future. Students are now forced to pay back HELP debts when they earn $45,000 a year. That is only $9,000 more than the minimum wage. We know that debt is a barrier for many students, particularly those from low-income families. It puts more pressure on household budgets at a time when they can least afford it. No-one knows this more than I do from working in Melbourne's western suburbs with kids from working-class families, kids whose parents were struggling to pay the rent every week. Building aspiration in those young people meant confronting their family's fear of debt at a young age. So I know full well how hard people are working on the ground to build that aspiration; to have those conversations with young people; to ensure that they seek a tertiary education; to identify our best and our brightest; to encourage them to talk to their families about the fact that the debt they will take on will be worth it; and to assure them that they have their government's support.

Since this government was elected, we have also seen students turned away by universities because of capped places. This unfairly leaves regional and outer suburban communities like mine worse off. It means that we are not seeing our best and brightest. It means that other determinants are getting in the way of us seeing the best of every young person in our country. Universities have been under attack with various funding cuts, the latest being in the 2018 MYEFO with the slashing of $328.5 million from university research, something that our university sector is speaking loudly on but without effect.

In electorates like mine all over the country, we are seeing youth allowance wait times blowing out. This leaves young people and those waiting to retrain with no support. I have stories in my electorate of people waiting for up to six months, so it's the end of first semester and they're yet to receive a youth allowance payment. What that means in communities like mine, in those families, is that they could be in a situation where that young person chooses to discontinue a university education because the family can't afford to support them while they study. This is heartbreaking—absolutely heartbreaking—and it's under this government's watch that these things are happening. It goes to the very core of what we believe.

As someone who has spent most of their life teaching, I believe that every child can learn if given the right circumstances. What is the message we're sending now? We know intelligence is not defined by postcode or region, but under this government it appears that going to university is determined by postcode or region or by the wealth of your family. The basic support that governments commit to—to support our best and brightest from low socioeconomic areas to go to university—is not being met in that critical first semester, which is when their studies get set up. It is an absolute shame.

In contrast, under previous Labor governments my electorate saw increased numbers of students accessing university. Those numbers have slipped over the past five years, in terms of percentages per capita, on this government's watch. I find that to be absolutely reprehensible, because we know that for our economy we need young people to be as highly skilled as we can allow. We need to be investing in our young people to ensure that Australia continues to be competitive in a global economy. We all know that in this place. We hear member after member on their feet talking about just that, yet we have a government that doesn't back that in with the legislation required and with the support required. Perhaps a review of why Centrelink can't manage to process youth allowance applications in a timely manner would allow young people in any community to pursue their dreams.

Unfortunately, it is not just the higher education sector that this government has cut and slashed. We've seen vocational education and training cuts, as well as 2.5 million public school students in this country being left worse off by its failure to properly fund public education. This government has cut more than $3 billion from TAFE skills and apprenticeships since being elected. This clearly demonstrates that they do not value vocational education and skills. When it comes to our public schools, almost nine in 10 public schools will never get to their fair funding level because of the Prime Minister's cuts. You have to extrapolate that to what that means in our university sector and what that means in our economy. On this side of the chamber, we understand that education, at all levels, is the key to a stronger society and the key to future prosperity.

In contrast to this government, a Shorten Labor government, if elected, will properly fund our universities with guaranteed three-year funding agreements. We will uncap university places so that 200,000 more Australians will have the opportunity of a university education over the next decade. We will invest in university research and infrastructure with our $300 million university future fund. We will provide more support for disadvantaged and underrepresented students to acquire the confidence and skills they need to get into university, with our $174 million equity and pathways funding.

We will invest across the whole education system by introducing universal early education for three- and four-year-olds and by investing $14.1 billion extra into the public schools across our nation, who educate two out of three Australian children. We will waive up-front fees for 100,000 students to attend TAFE. We will invest $100 million in modernising TAFE facilities around the country. We will be ensuring one in every 10 jobs in Commonwealth priority projects are filled by Australian apprentices. Labor has a plan for the entirety of education across this country. We will provide 10,000 pre-apprenticeships for young people who want to learn a trade. We will provide 20,000 adult apprenticeship places. We will establish an apprenticeship advocate to ensure Australia has an excellent, high-quality and inclusive apprentice system.

On top of that, we will return the workforce to Centrelink so that we can get over some of these processing issues that this government has been ignoring. When you draw all of these pieces together, what we see from this government is not just a lack of care. It's not just a lack of interest. If you grow up in my electorate and you're from a low socioeconomic area, what you perceive is a government that doesn't want you to be educated; a government that doesn't want to see you strive to be your best. It's a very sad state of affairs.

On this side of the parliament, Labor have committed to a national inquiry into post-secondary education. It's an inquiry that would look at the needs in this country and the broad, post-secondary space with TAFE and university. Importantly, it would look at them separately, but it would also look at the way they work together and the way they need to be supported by government to ensure that we're getting the best and the brightest in the right places—doing the right things and providing them with the level of support that they need.

I cannot get past the fact that it has taken this government three years to respond to the review conducted. It has taken them three years to draft a piece of legislation and pay attention to the recommendations made. They have been slow to act and, when they act, they act in limited ways. In contrast, I stand here proudly as a member of the Labor Party and proudly as the member for Lalor, because I know the people on this side of the chamber will act in the best interests of all Australians. I also know they'll take particular care of the students who are being raised in my electorate. They want all children in Australian schools to aspire to be their best. We want to see Australians leading in every industry. We want to see Australians applying themselves. We want to see them aspiring to high education levels. We want to see them applying themselves. And we want to see a government that will support our young people and those retraining—all people engaging in lifelong learning. We want to see a government that's prepared to support the industries that provide the education and support young people across their lifetime, from kindergarten all the way through to their PhDs.

I'd like to thank the member for Scullin for moving the important amendments that give us the opportunity to speak on this bill and support the government's recommendations—slow to act as they are. We will support the bill, but we speak strongly about the amendments that were put forward by the member for Scullin.

Ms TEMPLEMAN (Macquarie) (13:22): I rise to support the Tertiary Education Quality and Standards Agency Amendment Bill—it's not the catchiest title that we've had before us, but it's a worthwhile evolution of that agency—and to support the amendments moved by this side of the House. What concerns me is the fact that we are talking about this today. Having been in this chamber for 2½ years, I can say that it's not often that we get to speak about the broad quality of higher education here. It really highlights for me a lack of interest in this area by those opposite.

There was a review of the national regulator. That is the body that regulates our world-class higher education system. It looks at what's working and it looks at how it needs to be tweaked to ensure standards are met. The review of this regulator was provided to government three years ago. That's a really long time for there to be no action. I don't think the complexity of it meant that anyone was unable to get their head around it. I think it shows us that it just kind of got pushed to the side. Quite frankly, I do not get a sense of the belief we have on this side of the House. Education is a game changer for people. It transforms people's lives. They deserve quality education. Whether it's at the preschool level, primary school in the public school system, high school, TAFE or university, that quality needs to be available to people, especially at a time when we are shifting the cost to students more than they have ever seen. Those opposite have done that to an enormous degree. They have shifted the cost to students so that they now have to pay higher fees and they need to pay off their HELP debt sooner. It is only fair that they should expect a reasonable standard—a high standard of quality, in fact—that reflects the high level of fees that they are expected to pay.

Not many people have mums and dads who can afford to pay the fees. Most young people will finish TAFE or university with a debt. They will then have to spend years, at the same time that they've got this debt, trying to get themselves established in their chosen profession or career. They will have to equip themselves for that career and that role. They may also be looking at moving into a place that isn't perhaps five students squished into a four-room house. They'll be wanting to invest in themselves and their future at the same time that they've got this debt, so the cost for them to make their way in this world means it will just become really tough. I see it time and time again. I've got kids who are in their 20s. I see story after story of the challenges they face, not just when they're educating themselves but when they're taking the time to equip themselves for this world that is rapidly changing.

There will be many students right now preparing for their first semester of university. But, unfortunately, the freeze that the government has put on university places—the capping of places—means far fewer students are going to be doing that, especially in the outer western suburbs and regions like mine on the periphery of Sydney, such as the Hawkesbury and the Blue Mountains that make up the Macquarie electorate. There is no doubt that we in this place should be talking about broadening participation in higher education, in both TAFE and university, not talking about things to reduce it. Nor should we be talking about anything that reduces access or quality. Yet what we've seen from this government is the capping of university places. We have seen a slashing of research funding. Research done in universities is what's going to set us up to cope with a world that we can't even predict, and to take that away is the most short-sighted thing I can imagine. We've also seen under this government cuts to vocational and education training the likes of which no-one could contemplate or imagine, and we've also seen a failure to fund public education. We have, in addition, seen a lack of commitment to early childhood education. That is where it all starts, and it's vital that every step of that education cycle gets funded—preschool, school, vocational training and universities. That's how we create our future. That's how we make sure that we are fulfilling our responsibilities as a parliament to make the opportunities for those who are coming behind us that much easier and more suited to the world in which they're going to live.

It does concern me that this is a technical bill, and I'm very grateful that we on this side of the House have moved amendments to recognise just how important quality of education and access to education are. That's why, under a Labor government, we will also properly fund universities with three-year guaranteed funding agreements—not just 'here's a little bit to get you through the next year'. Universities need certainty in funding and they need to be able to plan. Their staff need to know that there's a future there so that they have a sense of assurance that the work they do will be able to continue and evolve. We also will uncap university places, and that is expected to lead to 200,000 more Australians having the opportunity to get an education over the next decade or so.

I think one of the most impressive things we're going to do is focus on research. As I said, I think it's just fundamental. Our $300 million university future fund, which will invest in university research and infrastructure, is part of that. In the electorate of Macquarie, we have the Western Sydney University campus at Richmond. That campus—the Hawkesbury campus—will benefit under Labor because of the incredible greenhouse that they have constructed. It is a massive glasshouse. You have never seen anything like it because there is nothing like it anywhere else in Australia. And Labor has committed to an additional $20 million in research funding that will make sure that we capitalise on the potential that we have in agriculture, in terms of working out how much water or how little water we can use to grow things, how few nutrients we can use to get the maximum benefit, and how we can grow things that will transport easily, either within Australia or, more importantly, for export. Labor's commitment to research will really pan out in my electorate in supporting our agricultural sector to be able to make the most of the opportunities as one of the most fertile areas within a short drive of Sydney. We should be growing for, and we should in fact be feeding, not just Australia but Asia.

The DEPUTY SPEAKER ( Mr Vasta ): The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour.

Mr WYATT (Hasluck—Minister for Senior Australians and Aged Care and Minister for Indigenous Health) (15:24): by leave—I present the explanatory memorandum to the Aged Care Amendment (Movement of Provisionally Allocated Places) Bill 2019.

The DEPUTY SPEAKER ( Mr Hogan ) (16:25): The question is that the motion moved by the Prime Minister be agreed to.

Question agreed to.

Ms BURNEY (Barton) (16:26): I rise to support this bill and move:

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

"whilst not declining to give the bill a second reading, the House:

(1) notes that:

   (a) this Liberal and National Government has spent the last five years trying to cut the pension and increase the pension age to 70;

   (b) in every Budget, this Government has tried to cut the pension—including a plan to change indexation, which would have left pensioners $80 a week worse off; and

   (c) the Government did a deal with the Greens political party to change the pension assets test and cut the pension for 370,000 pensioners; and

(2) condemns the Government for spending years trying to cut the energy supplement to new pensioners"

The Social Services and Other Legislation Amendment (Supporting Retirement Incomes) Bill 2018 changes the way pooled lifetime income stream products are means tested. It increases the amount of money pensioners can earn from employment, under the pension work bonus, an initiative from the Rudd Labor government. This bill increases the rate at which pensioners can draw down their assets under the Commonwealth's reverse mortgage program, the Pension Loans Scheme—a legacy of the Hawke Labor government—and opens up the Pension Loans Scheme to full-rate pensioners. This bill seeks to expand on important Labor legacies which expanded income streams for our pensioners.

To that end, Labor supports the changes to the work bonus. The work bonus provides an incentive for pensioners who are over pension age to participate in the workforce by allowing them to keep more of their pension when they have earnings from working. The work bonus functions by exempting a certain amount of income from the pension income test, above the pension income test free area. Currently the work bonus exempts the first $250 of fortnightly employment income. This bill will increase the income exemption to $300 per fortnight, with a commensurate increase to the work bonus income bank from a minimum of $6,500 to a maximum of $7,800.

The bill also expands eligible employment income to include self-employment. In 2009, as part of the Harmer pension review, the Rudd Labor government introduced the pension work bonus to replace the cumbersome Pension Bonus Scheme. Labor introduced the work bonus to encourage older Australians who are able to do so to stay in the workforce longer. This brings with it social and economic benefits, not just for individuals but also for our nation. Older Australians have incredible skills and experience. It is important that those who can and want to remain in the workforce on a part-time basis can do so without losing as much of their pension. This will also help Australians save for the future—something that is incredibly important to our ageing population.

Labor also supports changes to the Pension Loans Scheme, which is the government's voluntary reverse-mortgage scheme. The Pension Loans Scheme is a legacy of the Hawke Labor government to allow older Australians who own their own house to access additional income. In 1996 the Keating Labor government expanded eligibility to those who were previously ineligible by reason of the income test. So today, to be eligible for the Pension Loans Scheme, a person must (1) be of pension age, (2) own real estate in Australia and (3) receive a payment at less than the maximum rate of the age pension because of either the income or the assets test, but not both.

Currently only part-pensioners and self-funded retirees can access the Pension Loans Scheme. This locks many full-rate pensioners who own their own home out of the benefits of this scheme, and this is unfair. Labor welcomes the improvements to this scheme to open it up to full-rate pensioners. We also support the increase in the maximum fortnightly payment rate under the Pension Loans Scheme from 100 per cent to 150 per cent of the full pension rate. This will allow pensioners to enjoy a better standard of living by accessing the equity in their homes if that is what they want. Full-rate pensioners will be able to increase their income by up to $11,912 for singles and $17,958 for couples per year based on the current rates of the pension. While the take-up rates of the Pension Loans Scheme are currently low, it is an important option for older Australians, and this increase in the allowable rate of payment might just make it more attractive for more older Australians.

The changes proposed in relation to the pooled lifetime income stream products are very important to those considering putting their savings into this kind of product, which pays an annual sum for a person's life. It is a difficult decision to make a trade-off between keeping savings and securing an ongoing income, and people need certainty. Importantly, anyone who has purchased a pooled lifetime income stream product under the current means test will be grandfathered—an important point—and there will be no changes for them. It is important not just that the proposed means-testing arrangements are fair but also that the products themselves are sound and that people will be protected from rip-offs and shonks.

Labor supports the smoothing of the means test, which is also supported by COTA Australia and other seniors groups. And we will be holding a blowtorch to the government to make sure that the right financial regulations and protections are in place to protect pensioners who are considering purchasing a lifetime income stream. We will be very closely monitoring the kinds of products that are offered and the protections that are in place to make sure that people understand all the consequences of the long-term trade-off that comes with purchasing a lifetime income product.

As the banking royal commission has exposed, too many financial products have been crafted in the interests of brokers and banks, not ordinary Australians, and Australians know that this government will do anything it can to protect the big banks. The Prime Minister and the Liberal Party cannot be trusted to implement the recommendations of the banking royal commission—and, as has been mentioned and will continue to be mentioned, they did vote against the banking royal commission 26 times and they want to give the banks a tax cut. We should be changing the laws straightaway to clean up banks, but the Morrison part-time parliament is sitting only 10 days in eight months. The Leader of the Opposition has written to the Prime Minister urging him to hold two extra sitting weeks so that the Prime Minister can start cleaning up the banks now. The Liberals tried to stop the royal commission from happening. They will now try to go soft on the banks and will go slow on implementing the reforms. They cannot be trusted.

The Senate inquiry into this bill identified particular concerns related to the government's go-slow on the comprehensive income products for retirement framework, including a need to finalise the disclosure regime related to legislation and ensure that people get proper advice that is in their interests before purchasing a lifetime income stream. We will ensure that adequate financial regulations and protections are in place to protect older Australians. We will monitor very closely the types of financial products that are offered, and ensure that protections are available, so that consumers are fully aware of the financial and broader implications of those products.

Labor welcomes these positive changes and improvements to Labor initiatives which were enacted to make life easier for older Australians. But, make no mistake, pensioners will not be fooled: cutting the pension is in the Liberals' DNA. The age pension will always be stronger and safer under a Labor government. For five years the Abbott-Turnbull-Morrison Liberal government has spent every budget attacking the age pension. The current Prime Minister has spent five budgets, including three as Treasurer, trying to cut the pension. He has spent five budgets, including one as the Minister for Social Services, trying to raise the pension age to 70.

In the 2014 budget, the government tried to cut pension indexation—a cut that would have forced pensioners to live on $80 a week less within 10 years. This unfair cut would have ripped $23 billion from the pockets of every single pensioner in Australia. In the 2014 budget, they cut $1 billion from pensioner concessions—support designed to help pensioners with the cost of living. In the 2014 budget, they axed the $900 seniors supplement to self-funded retirees receiving the Commonwealth Seniors Health Card. In the 2014 budget, the Liberals tried to reset deeming rates thresholds—a cut that would have seen 500,000 part-pensioners made worse off. In the 2015 budget, the Liberals did a deal with the Greens to cut the pension for around 370,000 pensioners by as much as $12,000 a year by changing the pension assets test. In the 2016 budget, they tried to cut the pension for around 190,000 pensioners as part of a plan to limit overseas travel by pensioners to six weeks. In the 2016 budget, they also tried to cut the pension for over 1.5 million Australians by scrapping the energy supplement for new pensioners. The government's own figures show that this would have left over 563,000 Australians currently receiving a pension or allowance worse off. And over 10 years, in excess of 1.5 million pensioners would have been worse off. On top of this, the government spent five years trying to increase the pension age to 70. And they still refuse to adjust deeming rates for pensioners.

The Liberals still have cuts to the pension before the parliament. They want to completely take away the pension supplement from pensioners who go overseas for more than six weeks, which will see around $120 million ripped from the pockets of pensioners. They still want to make pensioners born overseas wait longer before qualifying for the age pension by increasing the residency requirement from 10 to 15 years. Labor has fought these cuts tooth and nail; this is the only reason the Abbott-Turnbull-Morrison government has flip-flopped and given in. The truth is: no-one spends five years—including three as Treasurer and one as social services minister—trying to cut the pension and increase the pension age to 70 unless it is what they really believe in. This is why pensioners know they cannot trust Scott Morrison. There is one simple fact: no matter who leads the Liberal Party, cutting the pension is in the party's DNA.

Over the past five years, we've seen older Australians wait longer and longer and longer to receive their pensions under the Abbott-Turnbull-Morrison Liberal government. We have read, heard and seen that pensioners wait months for their pensions, pushed to the edge of their bank accounts and pushed to desperation, uncertainty and fear. We have heard of pensioners waiting for hours on the phone to Centrelink, desperate to speak to someone about the fate of their pension payments. All the while, the Abbott-Turnbull-Morrison Liberal government has cut Centrelink jobs and outsourced them to labour hire firms.

Australians will not be fooled, and they will not forget the Liberals' atrocious record and attitude towards pensioners and older Australians. The Abbott-Turnbull-Morrison Liberal government has made it very clear that big banks, big business and the top end of town are its priority, not pensioners. The age pension will always be safer, stronger and more accessible under Labor.

The DEPUTY SPEAKER ( Mr S Georganas ): Is the amendment seconded?

Mr Husic: The amendment is seconded.

Mr TED O'BRIEN (Fairfax) (16:40): This Liberal-National government takes the needs of older Australians very seriously. In the term of this 45th Parliament, as a government, we have delivered on a significant body of legislation that comprehensively improves both the financial security and independence of retirees and will ensure the highest-quality aged care for older Australians who can no longer manage on their own. And, while the previous Labor government legislated the pension age to 67, the Morrison Liberal-National government has announced that the pension age will go no higher. It will remain at 67 years of age. Not only should this come as welcome news for hardworking Australians approaching retirement, but it should be noted that the government's ability to clip the pension age at 67 while ensuring a sustainable social security system is due only to the strong economy that a Liberal-National government delivers.

Beyond simply maintaining the pension age, the government's record of delivery for older Australians is unprecedented. We retained the energy supplement, and, notably, since the coalition was elected, pensions have increased by a touch under $100 per fortnight for singles and almost $150 per fortnight for couples. The Liberal-National government is also supporting older Australians to voluntarily stay in the workforce, thanks to a variety of measures—some of which are the subject of this bill—that also include the provision of wage subsidies of up to $10,000 for employers who welcome older Australians onto their payroll.

While making the case that only a Liberal-National government will fully protect the security, independence and welfare of older Australians, I can't move to the substance of this bill without first touching on the flip side—that is, what this government won't do. We won't steal the income of more than 900,000 Australians who will lose an average of $2,200 every year under Labor's retiree tax. We won't kick the floor under the property market and threaten the value of people's homes while simultaneously driving up rents by adopting Labor's disastrous policy of ending negative gearing and jacking up capital gains tax. We won't adopt Labor's plan to rip over $200 billion in extra taxes from the pockets of everyday Australians and small businesses. We won't legislate an economy-destroying 45 per cent emissions reduction target by 2030 that, if imposed, would mean a new dark age not only for Australian jobs and industry but, quite literally, for millions of Australians, including many older Australians who would face the devastating twin impacts of skyrocketing electricity prices and rolling blackouts under Labor's policy. Nor will we tempt a recession or threaten Australia's AAA credit rating or risk the jobs of everyday, hardworking Australians by deviating from our plan for a strong economy that ultimately protects Medicare, puts more drugs on the PBS, secures the age pension, builds schools, builds hospitals and pays teachers and nurses. These are the responsibilities that concern our government, and we won't be swayed and we won't be distracted by the false constructs or voodoo economics of those opposite.

Second only to the primary aim of keeping Australians safe, it is a key objective of this Liberal-National government to help Australians live longer, healthier and more active lives. In last year's budget, the government announced a comprehensive package of measures to help achieve just that, especially for older Australians. Some of these measures are the object of this bill. The Social Services and Other Legislation Amendment (Supporting Retirement Incomes) Bill 2018 will give retirees more options and a better deal in their retirement. The bill aims to enhance the standard of living for older Australians by giving them more flexibility and choice when it comes to managing their finances in retirement, and there are three specific changes proposed by the bill to help achieve this.

Firstly, schedule 1 establishes new means test rules that better accommodate the development of new and innovative income streams for retirees that have resulted, and will continue to result, from changes to superannuation first announced in the 2016-17 budget. These changes allow innovative pooled lifetime income stream products to qualify for tax concessions, provided they comply with requirements. Pooled lifetime income products, such as annuities, are financial products that effectively pool the contributions of multiple people to provide consistent income to surviving members for life. The existing means test rules were designed for simple income stream products, such as lifetime annuities, and would not be suitable for the wide range of more complex products that are expected to emerge in the near future, and, in the event of no action being taken, would leave the system open to exploitation and distort people's financial decisions. The new means test rules will apply to all pooled lifetime income products purchased on or after commencement, being 1 July 2019, and held by social security or Department of Veterans' Affairs income support recipients. Products acquired before commencement will not be affected by the new rules.

The new means test will only assess 60 per cent of payments from any pooled lifetime income stream and, by doing so, accepts that part of the payments from the income stream simply represent a return of the individual's initial investment and therefore should not be counted as income. The 60 per cent assessment will continue for a minimum of five years or until the person reaches their threshold day—which currently is when they reach 84 years—whichever is longer. Beyond this point, just 30 per cent of the purchase amount will be assessed. Schedule 1 also amends the rules for investment-type life insurance products to make sure they are consistent with the new rules for the pooled income products.

Secondly, schedule 2 of the bill increases the work bonus, being an income test concession for age pensioners and DVA pensioners over a qualifying age to encourage them to undertake work to supplement their pension. The proposed increase is from $250 to $300 per fortnight and represents the only increase since 2011. There is also a mechanism for pensioners that take advantage of the work bonus to accrue any unused portion of the current $250 fortnightly exemption, up to a total of $6,500, and use it to exempt future earnings from the income test. Schedule 2 will increase the maximum unused concession from $6,500 to $7,800, in line with the proposed increase in the work bonus amount. The work bonus will also be extended under the schedule 2 provisions to include all income from gainful work that involves personal exertion and, for the first time, will also include self-employed income, together with income from work as a contractor or as a consultant. As the work bonus currently applies only to employment income, this extended application improves both consistency and equity and, together with all schedule 2 reforms, will increase payments for more than 88,000 social security pensioners and extend eligibility to another 1,150 retirees.

Thirdly, schedule 3 of the bill extends the existing Pension Loans Scheme, otherwise referred to as the PLS, available through Centrelink to all older Australians with securable real estate, while also providing substantially improved access to the scheme. The PLS operates as a type of reverse mortgage where amounts borrowed are a debt payable to the Commonwealth, which is secured against real property owned by the retiree in Australia. The loan is subject to a compound interest rate set by the minister, which is currently at 4.25 per cent. The loan may be repaid at any time, with the debt usually recovered either following the sale of the secured property or from the person's estate after their death.

Schedule 3 amends all relevant legislation to allow any Australian, subject only to reaching age pension age or other relevant qualifying age, to participate in the PLS irrespective of their income or asset test assessment, including pensioners assessed at a maximum pension rate. Those participating in the PLS can draw on the equity in their homes and effectively borrow to a new threshold of 150 per cent of the maximum fortnightly pension rate, inclusive of any special assistance or other supplements that may apply in their case. This measure will better and more comprehensively target the PLS to meet the needs of a diverse range of retirement situations, giving older Australians greater flexibility and more choice via an affordable government regulated scheme to support their standard of living in retirement while allowing them to remain in their own homes.

In summary, this bill provides for three technical reforms to better support Australians in their retirement. New means test rules will ensure a fair and sustainable assessment of newly developed income stream products. The increase and extension of the work bonus will mean that less income from work will be assessed for income testing purposes, allowing higher income support payments to be maintained for eligible veterans and pensioners. And the expansion of the Pension Loan Scheme, the PLS, will allow retirees, including for the first time maximum rate pensioners, to improve their standard of living by accessing the equity in their home as a government loan while still living there.

The reforms outlined in this bill will give older Australians more choice and greater flexibility in managing their finances, allow them to keep more of their pension when they work and allow retirees who own their home to receive more income. By leveraging these successful social security programs to better support the needs of retirees, this bill further delivers on the Liberal-National government's strong, ongoing commitment to older Australians and, thus, I commend the bill to the House.

Ms SHARKIE (Mayo) (16:53): I rise to support the Social Services and Other Legislation Amendment (Supporting Retirement Incomes) Bill 2018. It should come as no surprise that, as the representative of the oldest electorate in South Australia, I am more aware than most of the needs and concerns of older Australians.

There are two parts of this legislation that I would briefly like to touch upon: the increase in the work bonus and the expansion of access to the Pension Loans Scheme. The proposed increase to the work bonus from $250 to $350 is an imminently sensible step that recognises the value of not penalising pensioners for remaining active and undertaking small amounts of employment. For example, there are pensioners in my electorate who deliver local newspapers in order to keep active and healthy. There are retired teachers who do a bit of tutoring after school, helping children and earning a little extra money on the side for their efforts. We know that those pensioners have such a wealth of knowledge and experience, and I think it's critical that we encourage older Australians to keep their hand in, if they feel that they would like to do so, to teach and share with the next generation. The current level of the work bonus has been eroded by inflation to the point that it is now starting to penalise this type of piecemeal work. The pensioners in my electorate will be very pleased that this legislation is being progressed.

I also welcome the extension of the work bonus to apply to income and to work from personal exertion, such as through self-employment and contracting or consulting work. However, I would encourage the government to consider indexing the work bonus such that the balance of the bonus does not continue to erode over time. Otherwise, the parliament must periodically be required to raise the bonus every couple of years by slow legislative means.

Secondly, I welcome, albeit cautiously, the expansion of the Pension Loans Scheme so it becomes available to all Australians of age pension age. The Pension Loans Scheme is a voluntary, reverse equity mortgage that offers older Australians an income stream to supplement their retirement income. It is only fair that access to this scheme is universal to all Australians of age pension age and provides everyone with the same financial support and opportunity. However, I will keep a watching brief over the scheme to ensure that there are no unexpected adverse outcomes of its expansion.

I think it's also timely to talk about the inadequacy of the pension, particularly if you are single and renting. Half-a-million older Australians rely solely on the age pension for income. Almost a third of them are living in poverty. They suffer substantial deprivation—going without food and heating, ignoring the need to see medical specialists and skipping medications—to make ends meet. Some are missing food in order to ensure that they can manage a visit to medical professionals. The average fortnightly expenditure on housing for renters was over $300, whereas homeowners spent less than $40 on repairs and remaining mortgage payments. The difference is vast. Owning your own home if you are a retired and older Australian makes you $240 a fortnight better off. These figures are from 2015, and we know that rents have increased and the pension has not kept in line with that.

So what gives? Last Friday, at the opening of my Victor Harbour permanent satellite office, I chatted with a gentleman who needs new dentures but can't afford them. Yes, he's on the state government list for public dental health, but it has been years. He's using a form of glue in his mouth to keep in the broken dentures that he has, and it is making him sick. It's causing him ulcers in his mouth. He was so distressed when I talked to him. No older Australian in our community should have to experience this. Older Australians on the pension are going without meals so they can have their medications and are going without heating so they can cover other bills, particularly those who are renting. It is important that in this place we do all we can to support every older Australian.

I believe that we need to increase the pension and provide those on the pension with a dental voucher, similar to the one the government provides to families who are recipients of family tax A. I believe that this is a policy that is needed—and needed so much that I've asked the Parliamentary Budget Office to provide a costing for the implementation of a dental voucher system for pensioners. I intend to share those Parliamentary Budget Office costings with the parliament in the hope that one of the major parties takes this up as an election promise. We know there is a strong correlation between poor oral health, and poor nutrition and poorer primary health outcomes. Helping pensioners to visit the dentist would improve health outcomes overall.

I would like to acknowledge the Benevolent Society for their work in the Fix Pension Poverty campaign. It is not something that makes front-page news, but it should be. We should be treating our older Australians better. Returning to this bill, and in closing, I welcome and support the speedy passage of this bill, which I believe will be of great benefit to older Australians, but I think we can do much, much more.

Mr WALLACE (Fisher) (16:59): Forty-six per cent of the people who live in my electorate of Fisher are over the age of 55. Twenty-nine per cent are already retired. For most of my constituents, the issue of how they are to support a healthy, long and active retirement is a live and critical question. In living on the Sunshine Coast, they have chosen to make Australia's most beautiful and welcoming lifestyle destination their home. However, they have chosen also to make their home in a location where the cost of living can be a challenge for many. According to the well-known cost-of-living comparison website numbeo.com, consumer prices in Sydney are 21 per cent higher than those on the coast, but the average purchasing power in Sydney is 46 per cent higher. Relatively speaking, for many it is as difficult—if not more difficult—to get by in my community as it is in our nation's most expensive city.

Many of my constituents, especially many of those who are older and retired, are finding it hard to make ends meet. They are not alone. According to a December 2017 OECD report, 26 per cent of Australian retirees are living below the relative income poverty line, which the OECD defines as half of the national average wage. The coalition has listened to the concerns of older Australians, and this bill is part of our suite of measures to help.

In my own electorate, I have convened the Fisher Seniors Council. This group of older residents living in my community gathers three or four times each year to discuss the issues that they face on the Sunshine Coast and to give me feedback on our government's policy ideas. When it comes to the cost of living, one of the messages that this group have given me loud and clear is that older people in Fisher want more flexibility in retirement. One of the members of the Fisher Seniors Council, Mr Frank Gower, continues to press me to ensure that we have an age pension that keeps up with the rising cost of living. This government has delivered that with an increase of more than $100 a fortnight since the coalition's election in 2013.

Most of all, seniors in my electorate don't want more handouts. They have worked to support their families all of their lives, and they want to continue to live independently. Seniors on the Sunshine Coast want the flexibility from government that they need to help support themselves. That flexibility to use their skills and their assets to support themselves is exactly what this bill delivers in two key areas.

Firstly, schedule 2 of this bill increases the work bonus to allow retirees to work more hours and earn more money without impacting their other entitlements. As people live longer and healthier, many are finding that they do not want to give up work entirely. I'm sure many of us in this place employ retired members of our community in our offices on a part-time basis, just as I do. They bring a wealth of experience and an unrivalled knowledge of our local areas that can be invaluable in any parliamentarian's team. In a great many sectors of our economy, from retail to agriculture, the experience of decades, the old-fashioned work ethic and the calm wisdom that many of our retirees can contribute would be welcomed by employers. My Fisher Seniors Council consistently tell me that they want the choice to work more to supplement their income but that the resulting reduction in their other entitlements is a substantial disincentive. This bill reduces that disincentive by increasing the work bonus to $300 earned per fortnight.

Further, this bill provides flexibility in responding to the changing nature of work. For retired people, self-employment or contract work can be particularly appropriate, allowing them to fit their employment around their other family and often, as is the case, their volunteer commitments. However, until now none of that work was covered by the work bonus. This does not reflect the nature of the modern workforce nor of the particular needs of working seniors, and this bill rectifies that situation.

This bill also addresses one of the issues that my older constituents most often bring to my attention. Many older residents of Fisher are relatively asset rich but income poor. The government has already taken steps to provide more flexibility for these constituents by allowing them to make a non-concessional contribution of $300,000 into their superannuation from the proceeds from downsizing their homes. But this bill goes further, giving more seniors another option of releasing equity from their homes and increasing their income in retirement.

The Pension Loans Scheme allows older Australians who own their own home to, in effect, take out a type of reverse mortgage with the Commonwealth government. Existing part-rate pensioners and self-funded retirees who are currently precluded from the pension by the asset test have the option to receive additional payments, up to the maximum rate of the full fortnightly age pension, by progressively borrowing against the value of their home from the Commonwealth at a competitive rate of interest, which is currently set at 4.25 per cent. This debt can be repaid at any time, and is usually repaid from the individual's estate.

However, there are many retirees who are not currently able to benefit from this scheme. Schedule 3 expands the Pension Loans Scheme to include those who are already receiving the maximum rate of pension and self-funded retirees who do not have sufficient assets to preclude them from the age pension. The bill also increases the total amount which can be borrowed under the scheme to 150 per cent of the maximum fortnightly pension. This will give flexibility to those who need a higher income to support their active retirement. Just a few days ago I spoke with a constituent in my electorate, Mrs Margaret Little, about how she would dearly love to have taken advantage of just this sort of a scheme but previously hadn't been able to access it. Now, as a result of these amendments, she will be able to. So that is, indeed, very good news for Mrs Little and people like her.

With this bill, the coalition is listening to senior Australians and providing them with more options for increasing their income and security in retirement. It is only the latest in a series of decisions made by this coalition government to support older people to live longer, healthier and more active lives. Since the coalition government was elected in 2013, pensions have increased by $107.90 a fortnight for individuals and $162.60 a fortnight for couples. We've used the proceeds of the strong economy that this government has helped to build to avoid the need to increase the qualification age for the pension to the age of 70. That same strong economy has allowed us to avoid repealing the energy supplement, thereby ensuring that individual pensioners have another $366.60 more in their pockets every year.

All of this could not stand in more stark contrast to the policies of the Labor Party. I met a man in my electorate office recently—his name is Adrian—who, like me, was a builder. He came to Australia from his native Italy with very little, and he has worked extremely hard ever since he came here. Adrian is a perfect exemplar of the benefits that Australia can derive from ambitious people born overseas who want to come to our country to get ahead and to help build our community. Adrian worked hard, and he invested the money that he earned to create a secure retirement for himself and a future for his family. Some of his investments were successful; some were not. But, when times were tough, Adrian got back on the tools, and he's worked his way back like many migrants and small-business people in this country. Throughout his life, everything that Adrian had he had earned for himself. He's rightly proud of that achievement and he rightly expects to enjoy the modest fruits of that labour in his retirement. He, like so many Australians, has saved enough to give him a comfortable but by no means extravagant income in retirement. But when Adrian came to my office, he was furious about what the future may hold for him and his family under a Shorten Labor government.

Adrian had looked into the Labor Party's retiree tax. He'd explored what their proposal to end retirees' dividend imputation credits, pulling the rug out from under millions of hardworking Australians, would mean for him. For Adrian, the ill-judged, punitive policy of members opposite would result in the loss of 60 per cent of his income. It would take him from a secure retirement to a life filled with doubt and uncertainty about the future. Adrian knows what all Australian seniors know—that this huge, new retiree tax proposed by Labor is fundamentally unfair. It constitutes a massive cash grab by a Labor Party so desperate to fund its unsupportable, fantastical spending promises that it is willing to take the livelihoods of some of society's most vulnerable people to do it, because it's not simply Adrian who would be affected by Labor's retiree tax. Nationwide, around 900,000 Australians stand to lose an average of $2,200 every year. Australians with self-managed super funds are set to lose an average of $12,000 every year. Labor's tax will affect Australian shareholders who are on incomes of less than $65,000, self-funded retirees, self-managed super fund trustees, small APRA-regulated funds, large retail APRA-regulated funds and retired small-business owners alike. Interestingly, yet unsurprisingly, it will not affect the industry super funds.

Labor's tax will cost retirees and small businesses almost $5 billion per year and, in total, will rip $45 billion out of our nation's hard-earned savings. In my electorate alone, 7,200 older Australians will be directly and immediately affected by Labor's tax. Thousands more of my constituents who have not yet reached retirement age will have their potential income in retirement slashed by this extra taxation. Contrary to the misleading statements of the Leader of the Opposition, the hardest hit will be those on the lowest taxable incomes. Eighty-four per cent of the hundreds of thousands of people who will be hurt by Labor's policy have a taxable income of less than $37,000. This tax will hurt hundreds of thousands of ordinary people who have done the right thing and saved just enough for their retirement.

Like many others in my electorate, Adrian is passionate about trying to do something about this unfair and ruinous new tax. He's determined to do what he can to stop the Leader of the Opposition and the Labor Party from bringing about this disastrous new reality for Australian seniors. Members opposite should take note: if they continue to insist on this damaging tax, they will find themselves facing passionate opposition from some of our society's most experienced, engaged and active citizens. For their own good, let alone for the good of the people of Australia, I would counsel them to beat a path to the Leader of the Opposition's door and convince him to abandon this unjust assault on our older Australians.

This legislation demonstrates once again that it is the Liberal and National parties who respect the contribution of Australia's older people and who will put forward the measures they need to support an active and fulfilling retirement. It will make a difference to thousands of senior Australians. I commend the bill to the House.

Ms O'TOOLE (Herbert) (17:14): The Social Services and Other Legislation Amendment (Supporting Retirement Incomes) Bill 2018 makes some positive changes for our pensioners. It was less than a year ago that I met with a Townsville pensioner named Tom. Tom, although retired, was still very active and was still able to work part time. Tom would rebuild broken bicycles and do paid handyman jobs here and there. Clearly, Tom's work schedule and pay would fluctuate. The difference would often be minuscule, but it would be enough to affect Tom's pension. This is where the system was very difficult for him. Tom still wanted to be able to work and earn a bit of cash, but he certainly required his pension. A few dollars here or there, when the limits were already so incredibly small, would affect Tom's pension. It did. This bill seeks to make changes to help pensioners like Tom.

This bill changes the way pooled lifetime income stream products are means tested; increases the amount of money pensioners can earn from employment under the work bonus before their pension is reduced; increases the rate at which pensioners can draw down their asset under the Commonwealth's reverse mortgage program, the Pension Loans Scheme; and opens the Pension Loans Scheme to full-rate pensioners.

The changes to the work bonus in particular will assist people like Tom. The bill will increase the income exemption under the work bonus from $250 per fortnight to $300 per fortnight, with a commensurate increase in the work bonus income bank from a maximum of $6,500 to a maximum of $7,800. Also, the bill will expand eligible employment income to include self-employment. These are positive changes that will encourage older Australians to stay in the workforce longer, with all the social and economic benefits that brings not just for individuals themselves but for the nation as a whole. Older Australians have incredible skills and experience, and it is therefore important that those who can and want to remain in the workforce on a part-time basis can do so without the losing as much of their pension.

The changes to the Pension Loans Scheme will also provide great assistance to our pensioners. The purpose of the Pension Loans Scheme is to allow older people who are asset rich but cash poor to access an income. Currently, to be eligible for the Pension Loans Scheme a person must be of pension age; own real estate in Australia that can be used as security; receive a payment less than the minimum rate of the income or assets test but not both—this test can apply to a partner; and meet age-pension residency requirements. Currently, only part-pensioners and self-funded retirees can access the Pension Loans Scheme. This locks out many full-rate pensioners who own their own home from the benefits of the scheme. This is unfair, and Labor welcomes the government's changes to open the scheme to full-rate pensioners.

I also support the increase in the maximum fortnightly payment rate under the Pension Loans Scheme from 100 per cent to 150 per cent of the full pension. This will allow pensioners to enjoy a better standard of living by accessing the equity they may have in their homes. Full-rate pensioners will be able to increase their income by up to $11,912 for singles or $17,958 for couples combined, per year, based on the current rates of the pension. While the current take-up rates of the Pension Loans Scheme are very low, it is an important option for Australian pensioners. The increase in the allowable rate of payment might make it more attractive to many more older Australians.

Then there are the changes proposed in relation to the pooled lifetime income stream products, which are complex. It is important not just that the proposed means-testing arrangements are fair but also that the products themselves are sound and that people will be protected from rip-offs and dishonest operators. That is why Labor supports the smoothing of the means test, which is also supported by COTA Australia. But we will be holding to account the Morrison government to make sure that the right financial regulations and protections are in place to protect pensioners who are considering purchasing a lifetime income stream. I want assurances around the kinds of products that are offered and the protections in place to make sure people understand all of the consequences of the long-term trade-off that comes with purchasing a lifetime income product.

As the banking royal commission has exposed, far too many financial products have been crafted in the interests of brokers and banks and not ordinary Australian citizens. Australians know this government will do anything it can to protect the big banks. The Prime Minister and the Liberal Party cannot be trusted to implement the recommendations of the banking royal commission, because they voted against that banking royal commission 26 times and they wanted to give big banks a tax cut. We should be changing the laws straight away to clean up the banks, but the Prime Minister's part-time parliament is sitting only 10 days in eight months and that makes it a bit difficult. Given these facts and the fact that the Prime Minister, Scott Morrison, is a good friend of the banks and not the Australian people, I am sceptical and will be holding them to account if they allow financial institutions to run riot under the changes in this bill.

The Senate inquiry into this bill identified particular concerns related to the government's go-slow on the Comprehensive Income Products for Retirement Framework, including the need to finalise the disclosure regime and related legislation and ensure that people get proper advice that is in their interests before purchasing a lifetime income stream. Clearly, the LNP government's go-slow approach on this framework, as well as the recommendations from the banking royal commission, potentially allow for unscrupulous behaviour. Enough damage has already been done by the Morrison government delaying the banking royal commission that I call on them to not use the same approach for this framework.

Although there are positive changes in this bill, pensioners won't be fooled by this LNP government. Cutting the pension is in the Morrison government's DNA. They have tried in every single budget—including in three budgets where the current Prime Minister had the job of Treasurer—to cut the pension and to increase the pension age to 70. In the 2014 budget they tried to cut pension indexation—a cut that would have forced pensioners to live on $80 a week less within 10 years. This is unfair and unjust. It would have ripped $23 billion from the pockets of every single pensioner in Australia. In the 2014 budget they cut $1 billion from pensioner concessions—support designed to help pensioners with the cost of living. In the 2014 budget they axed the $900 seniors supplement to self-funded retirees receiving the Commonwealth Seniors Health Card. In the 2014 budget the Liberals tried to reset the deeming rates thresholds—a cut that would have seen 500,000 part-pensioners worse off.

In 2015 the Liberals did a deal with the Greens to cut the pension of around 370,000 pensioners by as much as $12,000 a year by changing the pension asset test. In the 2016 budget they tried to cut the pension of around 190,000 pensioners as part of a plan to limit overseas travel for pensioners to six weeks. In the 2016 budget they also tried to cut the pension of over 1.5 million Australians by scrapping the energy supplement for new pensioners. The Morrison government's own figures show that this would have left over 563,000 Australians currently receiving a pension or allowance much worse off. Over 10 years, in excess of 1.5 million pensioners would have been worse off. On top of this, they spent five years trying to increase the pension age to 70. They still refuse to adjust the deeming rates for pensioners.

I feel as though I need to take a breath after going through that long list of LNP cuts to pensioners, but the sad fact is the cuts don't stop there. The Liberals still have cuts to the pension before the parliament. They want to completely take away the pension supplement from pensioners who go overseas for more than six weeks. This will see around $120 million ripped from the pockets of pensioners. They still want to make pensioners born overseas wait longer before qualifying for the age pension, by increasing the residency requirements from 10 years to 15 years.

Labor has fought these cuts tooth and nail. No-one spends five years, including three as Treasurer, trying to cut the pension and increase the pension age to 70 unless it is what they truly believe in. This is why pensioners know that they cannot trust Prime Minister Scott Morrison or his government. There is one simple fact: Prime Minister Scott Morrison was the architect, the designer, the engineer, the craftsman and the builder behind every cut and every attack on Australian pensioners. Pensioners know that with another term of a Morrison government, there would be more cuts on the way which will impact on them. It is only Labor that has fought against every single cut to pensioners, and it is only Labor that will look after Australian pensioners.

Mr HUSIC (Chifley) (17:24): I want to make three points about the Social Services and Other Legislation Amendment (Supporting Retirement Incomes) Bill 2018: firstly, to talk about the things in this bill that we are quite open to supporting; secondly, to talk about the context in which this bill is being considered and some of the history behind some of the things that led us to this point; and, thirdly, to raise my concerns about the way in which pensioners today are being treated or, I might say, mistreated by this government through the failure to deal with pensioner concerns and the way in which pensioners are being treated when they interact with the government.

At the outset, we have said that we certainly are open to some of the measures that are being put forward in the bill itself. The bill changes the way pooled lifetime income stream products are means tested and increases the amount of money pensioners can earn from employment under the pension work bonus. This was an initiative introduced by the Rudd Labor government. The bill itself increases the rate at which pensioners can draw down their assets under the Commonwealth's reverse mortgage program, the Pension Loans Scheme. I think it is important to point out that that this scheme is a legacy of the Hawke Labor government. The bill also opens up the Pension Loans Scheme to full-rate pensioners and seeks to expand on important Labor legacies which expanded income streams for pensions.

On the work bonus, I must say, I am particularly supportive of this element, which is allowing, in particular, for pensioners over the pension age to keep in contact with the workforce. That allows them to keep more of their pension while they're having earnings from working. It functions by exempting a certain amount of income from the pension income test, above the pension income test-free area. Currently, the work bonus exempts the first $250 of fortnightly employment income. This bill will increase that to $300 a fortnight. There is also an increase in the work bonus income bank from a maximum of $6,500 to a maximum of $7,800. These things are important in an environment where many industries are experiencing skills shortages and where skills shortages may be an increasing concern.

Given some of the changes that we are seeing in the labour market, finding a way to keep people who have built up expertise and experience through their work life and keeping them engaged in some way in the workforce is good for the individual. It is also good for the country to have that expertise put into place. If we can also quite strongly deal, as a nation, with some of the perverse age discrimination that occurs in our workplaces—at a time when those same workplaces are crying out for more workers—I think that is an important thing.

We do know that the nature of work in this country is changing and that there are some people who will find, through the process of firms applying new technology in their workplaces, that automation may have an impact on jobs. We need to find new ways to retrain people and to get them new roles as well. There will be older people who still want to maintain contact with the workforce. We also need to ensure that their skills are up to date and that we provide adequate, strong and practical training platforms that allow for older Australians to maintain contact with the workforce.

We have to make sure that we don't have disincentives in place that mean that people who are accepting a pension feel that they can't work in the workforce, they can't contribute to the workforce or they can't, in some way, reduce the skills shortages that exist. The rules that we've set around their pension might mean that they feel that if they work too much then they are going to lose some of their pension. These types of changes that we're talking about in here are really important. We are certainly happy to support some of the changes that have been put forward. My colleague the member for Barton, the shadow minister for social services, has spoken at length about some of the other elements to this bill that we're quite open to—in terms of the Pension Loans Scheme and the pooled lifetime income streams—and has canvassed those at length.

I did say that there were two other elements to my contribution today that I wanted to make. The next one is about the context in which this occurs. As much as I and my other colleagues have expressed support for some of these initiatives, this has not been developed by a government that has been friendly to pensioners. We suddenly hear, as the member for Gorton and I have been subjected to in this place and elsewhere, this found devotion for post-retirement incomes by those opposite. We heard all the campaigning, the quite disgraceful campaigning, that was waged by the member for Goldstein in his role as the chair of a parliamentary committee that should not be so blatant in its politicking and its fundraising—using a parliamentary committee to do all these things. At no point have we seen these people stand up for pensioners in the same way that they want to stand up for people who are getting franking credits in excess of what they need; those people are given large amounts of government money. Those opposite have suddenly said, 'This is an unfair thing to even think, taking away these excess credits.' But, when you consider all the things that were being proposed by this government to impact people on some of the lowest incomes in the community—older Australians who are pensioners—you've never seen them stand up for pensioners in the same way.

Look at the way in which the coalition has sought to attack pensioners. For the five years of this government, the current Prime Minister spent five budgets, including three as Treasurer, trying to cut the pension and one as the Minister for Social Services trying to raise the pension age to 70. In the 2014 budget, they tried to cut pension indexation, which would have meant pensioners would be forced to live on $80 a week less within 10 years. It was an unfair cut that would have ripped $23 billion from the pockets of every single pensioner in Australia. We never hear them talk about that. They all signed up to it; they were all happy to see this happen to pensioners.

In 2014 they cut $1 billion from pensioner concessions—$1 billion in support designed to help pensioners with the cost of living, and they cut it. Again, none of them turned up to parliamentary committees and none of them set up those dodgy websites where they think they can score a political point. They're never there to back in pensioners. In 2014 they axed the $900 seniors supplement to self-funded retirees receiving the Commonwealth seniors card. In 2014 they tried to reset deeming rate thresholds, which would have seen 500,000 part-pensioners made worse off. Where were these people in standing up for people? They were nowhere to be seen. They all filed, one after the other, to back in these impacts on older Australians.

In 2015 they went at it again. They did a deal with the Greens to cut the pension of around 370,000 pensioners. Mind you, the Greens in the Batman by-election suddenly thought that they were going to stand up for older Australians and said they wouldn't support Labor's campaign to reform franking credits. This is the same party who sidled up to that party over there to rip off older Australians. As I said, 370,000 pensioners would be affected by as much as $12,000 a year by changing the pension assets.

Mr Brendan O'Connor interjecting—

Mr HUSIC: If they don't have a good memory—my friend the member for Gorton points out the need for memory—we will remind them every single day. We remember absolutely what they tried to do to older Australians.

In the 2016 budget, not content with all those other changes, they then tried to cut the pension of around 190,000 pensioners as part of a plan to limit overseas travel for pensioners to six weeks. How dare they want to stay in contact with family members overseas and leave the country! So they decided they would go in there and rip off the pension even more. In the 2016 budget they also tried to cut the pension for over 1.5 million Australians by scrapping the energy supplement for new pensioners. Now they are getting up and saying, 'We saved the energy supplement.' They wanted to get rid of that energy supplement time and again. It was only through a sustained campaign led by the member for Jagajaga to maintain the energy supplement that they buckled and, at the last moment, relented and refused to cut out the supplement that in their heart of hearts they have tried to rip off for ages.

Scrapping the energy supplement would've left over 583,000 Australians who are currently receiving a pension or allowance worse off and, over 10 years, that would have been in excess of 1.5 million pensioners. Where were you when this was being done—through the chair, if you don't mind me saying in general terms, where were those opposite when this was being proposed?

On top of this, they spent five years trying to increase the pension age to 70, which would have been the highest in the OECD, and still refused to adjust deeming rates. They want to completely take away the pension supplement from pensioners who go overseas for more than six weeks, and they still want to make pensioners born overseas wait longer before qualifying for the age pension. That is what those opposite do.

If that's not bad enough, they make older Australians wait longer to access the age pension. They've changed the goalposts on when they'll deliver a decision for older Australians. It used to be, roughly, 36 days. Now it's up to 49 days. When they delay the decision to grant older Australians the age pension due to them, they say, 'It's not our fault; it's the fault of the average Australian making the claim. They should have done it earlier.' What a joke, a government that can't get its act together to determine whether or not a person eligible for the age pension should get it. It's not that they can't do it; it's that they won't. They are holding back money to older Australians because they refuse to pay out the age pension. They put up every type of excuse possible, but they will not pay out the age pension to those who deserve it.

They have cut jobs from the Department of Human Services. They make you wait for ages when you're on the phone trying to get help. They make it near impossible to turn up to a Centrelink or Medicare office to get service. They're always trying to take you to a website or, failing that, a phone call, but they don't provide support to make sure those things operate efficiently. The government continually blames the average older Australian for things that they should be accountable for or, as the member for Gorton said, that they should accept responsibility for. They refuse to do it. When you look at the number of jobs they've cut, when you look at the number of contractors they've put on and when you look at the way complaints have soared it is no surprise you are getting this outcome.

For what they are putting forward we have said:' Enough's enough.' Our side of politics has said we will invest in better service and we will invest in a new workforce and we will put 1,200 people into DHS to make sure people get the help they need and at the time they need it most. I am very proud that we announced 50 new jobs in the seat of Longman over the course of last year. We announced 50 jobs in Braddon. I'm particularly proud that in our decentralisation push we announced, for the seat of Herbert, 200 DHS jobs in Townsville, and we announced 100 jobs for the seat of Leichhardt. This is to make sure that people get help when they need it most. It's to see good jobs go out to the regions instead of being stuck in one place. It delivers on a decentralisation agenda. Those opposite talk about it but fail to deliver. It's up to us to make sure that it happens.

You don't hear the Minister for Human Services commit to these jobs or stop the job cuts. Instead, he's out there defending the contractors and saying he'll do more contracting out. It's a continued recipe for failure, given the way complaints have soared under this government. Instead of backing in better service, backing in full-time jobs, recognising that people want that work, recognising that the public want better service, he says to us, 'What are you going to do about the contractors?' It's like he's a member of a government that's cut jobs but has discovered a commitment to job security, all of a sudden! That is patently false. What they are committed to is an ideological obsession with contracting out, with reduced employment standards and reduced commitment to service—at a time when older Australians depend on that service.

While there's a lot to be said in favour of this bill, it is done against a backdrop of declining service, under this government's watch, a failure to deliver the service Australians expect. I expect the next member who gets up can defend all the rip-offs of pensioners that he has been an accomplice to! (Time expired)

Mr PITT (Hinkler) (17:39): I very much enjoy following a contribution from the member for Chifley. It's always full of euphemisms, and it certainly gives me the opportunity to compare and contrast our policies with those of the opposition. I must say to the member for Chifley: welcome aboard the decentralisation bus. I think you should take a bit of time to speak to your colleagues about it, because I'm fairly confident that they haven't supported it for some years, in fact decades. I'm pleased to see that, finally, someone over there supports the decentralisation of the Public Service into the regions, and I'm very supportive of what the member for Chifley had to say in regard to decentralisation.

But, of course, I rise to speak on the Social Services and Other Legislation Amendment (Supporting Retirement Incomes) Bill 2018. This bill implements measures announced as part of the 2018 budget to give retirees greater choice and flexibility when it comes to managing their finances in retirement. Why should that happen? Well, because they deserve it. Over a lifetime they garner experience that matters, that is invaluable, that can be passed on, that can be utilised, that can be transferred to those in need. So I think this is a great opportunity not only for them, not only for those others who are in the workplace, but also for us, because it is incredibly important that we can transfer the skills of those older Australians to others in need. I thank them all for their contribution. Certainly without that age bracket working as volunteers right around our country we would not be able to support as many things as we do. The time that they give freely is, I think, invaluable.

There are three main changes in the bill to support Australians in retirement. There's an expansion of the Pension Loans Scheme, an increase and expansion of the pension work bonus and a new means test rule to encourage the development and take-up of lifetime retirement income products. The member for Chifley said that we have found a sudden devotion to those on the pension, those who are older and more senior Australians, and those who are more experienced. That is absolutely not the case, especially in my electorate. At the 2016 census, the median age of people in the electorate of Hinkler was 46 years, which is about 10 years above the state average, and 25.4 per cent of them were aged 65 years and over—36,346 people. Approximately 20,500 of them, about 14 per cent, were aged between 55 and 64. As at June 2018, a total of 27,860 people were receiving the age pension in Hinkler. So for me, as a local member, they are an incredibly important sector of our community. We must stand up for what they need, and this bill makes changes that are good for them. They are good opportunities.

Let's compare and contrast what we are doing in the bill before us with the proposals from the opposition. I'll quote from the front page of NewsMail, my local newspaper: 'Hip-pocket hit for 5500 retirees'. There will be a hip-pocket hit for 5½ thousand retirees. That is an enormous number of people. But this is the proposal from those opposite. They want to go to them and take away some of their meagre returns at tax time. In fact, on average, it's just $2,200 a year. Those opposite put forward that they haven't paid tax. I'm not sure how they worked that out. People own a share in a company. It's their part of the company. It has paid tax. It's on their behalf. If they are a low-income earner, they're entitled to a tax refund like every other Australian. Every other Australian is entitled to that tax refund, but not according to those opposite. In fact, the local candidate for the Labor Party dug a pretty big hole for himself when he said:

Make no mistake, this is an unfair loophole that over-whelming benefits the wealthy.

Most people in Bundaberg have never heard of franking credits or know how to access them …

It's just outrageous. How can you suggest to these people who make their claim every year that they don't understand it, that it doesn't apply to them and that they are rich? They absolutely are not rich. The refund on average is $2,200. That might not make a lot of difference to a Labor Party organiser who is the candidate in Hinkler—I'm sure the union has plenty of money to pay his wages—but $2,000 for people on low incomes helps them with their rates bills and electricity bills. It helps them pay bills that they would otherwise not be able to pay.

Mr Christensen: Medical costs.

Mr PITT: As the member for Dawson says, it helps them with their medical costs. It helps them with their day-to-day living. This is a source of income for them. They are entitled—they are entitled—to get that refund like every other Australian. What are they suggesting? That people should give up all the things they've worked hard for and invest in something else, which they're then entitled to get a tax return on because those opposite want to take a massive $200 billion tax grab from the Australian economy and take a hammer to the Australian economy. I think this is just outrageous.

The candidate for the Labor Party in Hinkler has doubled down. He has gone out on social media and said that Labor will end this tax loophole. It isn't a tax loophole; these people are entitled to a rebate. It is the same for every single Australian. The comebacks on Facebook have been pretty solid. I looked at what's been put forward by Mr Jesse Zielke. I know Jesse. Jesse is a local builder and he's told me outright that he supports a different side of politics. And he's entitled to: this is a democratic system and you can vote for whoever you like. But I think what he says is important as a response to what the Labor candidate has put forward. He says:

To put it even more simple, it's the same as an employer paying an employees tax on their behalf. I'm no where near retired and think this is just plain wrong, the shareholder is paying tax and the same shareholder is a retiree who's managed to make some good decisions in life and reduce the burden on claiming a pension which actually saves a lot of money. Happy to support good policy, but this is just wrong.

And it goes on. There are endless letters to the editor, including one from Brian Reynolds. He's pretty straight up and down. He says:

Labor's tax on the vulnerable is ridiculous, unfair, infantile, stupid and unsustainable.

In fact, he suggests:

… Labor shows a complete lack of understanding of financial matters.

He goes on:

If Labor will steal from the elderly and most vulnerable Australians, they will have no problem keeping tax returns from others in the future.

I've got to say that I continue to be surprised that Labor haven't changed their minds and backed off, because this is taking money from the people who desperately need it, who are entitled to it, who get the return and have set up the structures for their retirement many years in advance, and Labor simply want to rob it from people's pockets. That's it—$2,200. What does the Labor candidate think? He thinks they're rich and they've come from capital cities—and I say shame on him. That is very, very ordinary.

Getting back to the bill, the Pension Loans Scheme provides fortnightly income payments at a reasonable rate of interest to people who have receive a reduced rate of income support pension or do not receive any income support pension because of the income or assets test. Payments are made for a short period of time while the person's income and assets are being rearranged or may be made for an indefinite period. A loan under the Pension Loans Scheme can be repaid in full or in part at any time. The full amount of the loan plus interest owed at the time of the death of the person will be recovered from the person's estate. There is quite a lot of detail in the bill, of course. I don't intend to stand here and regurgitate all of that.

The legislation increases the work bonus threshold from $250 to $300 per fortnight for those individuals who choose to do some more work. I look at my own family. My father is 74. They still run an extensive harvesting contract business. They've reduced their farming operations, but he goes to work because he enjoys it. I think that the opportunity for those individuals to put a little bit more in the tin is very helpful for them, and I think it's in the best interests of all. This also means that the first $250 of fortnightly employment income is not counted under the pension income test. The legislation amends the current rules for lifetime income stream to create fairer, more equitable means test outcomes. Once again, this is well supported across the parliament and makes a very, very reasonable contribution to those older Australians who have certainly done a lot for us. They have been stoic. They have dealt with incredibly difficult times throughout their lifetime, whether those are world wars, local wars or difficult times through floods and droughts. They have contributed to Australia. They have made Australia a better place, and we should look after them and provide them with opportunities.

I note that the member for Dawson is in the House and is very keen to make a contribution. I say again to the Labor candidate for Hinkler: 'You should change your mind on this. You have a dug a hole for yourself. You have not only called those people in my electorate rich but said they are trying to dodge taxes through a tax loophole without getting a small and meagre return that helps them to pay their bills.' I think it is an outrage and he should be called out for it. I thank you, Deputy Speaker Hastie, for the opportunity to make a contribution. I support the legislation.

Mr CHRISTENSEN (Dawson) (17:49): I rise to speak on the Social Services and Other Legislation Amendment (Supporting Retirement Incomes) Bill 2018. This bill makes a number of changes announced in the budget last year. These changes are to help support incomes for Australians in retirement.

The first change outlines how pooled lifetime income streams will be assessed for social security means testing. The new rules taking effect from 1 July from next year will mean that 60 per cent of payments for a pooled lifetime income stream will be treated as income and 60 per cent of the initial purchases amount will be assessed under the assets test. After five years, or when the person reaches the life expectancy of a 65-year-old male, currently 84—whichever is longer—the assets test will assess only 30 per cent of the initial purchase amount.

A second change this amendment will make refers to the work bonus. Currently pensioners can supplement their pension by up to $250 a fortnight without affecting their pension. This amendment raises that threshold by $50 to $300.

The third change extends the Pension Loans Scheme to all older Australians with securable real estate. The current scheme, which is effectively a type of reverse mortgage, is only available to part-rate pensioners and their partners and some self-funded retirees.

But while these are positive changes, pensioners, especially self-funded retirees, have a very uncertain future ahead of them if the government changes. That's because they would face the threat of Labor's retirement tax if Labor were to form government next year. Earlier this year, some genius in the Labor Party dreamt up a new way to steal people's money. They figured out that pensioners and self-funded retirees had it too easy, apparently. The party thought they weren't being taxed enough, so they created this special tax for older people, a retiree tax. What they've designed is blatant theft. Labor promised to raid $59 billion on imputation credits that retirees earn on their savings.

Most people are not across how imputation credits work, so Labor is trying to pull the wool over their eyes by dressing it up as something that it is not. Labor claims that the government is handing out money to retirees. They are saying we are handing out money to retirees. The truth is the government is simply returning money that it has already taken off retirees that it should not have taken off them. The truth is the government accepts that they have taken too much money off those retirees. They have taken more tax than those retirees have to pay and are liable to pay. Imputation credits are a means of avoiding double taxation. They are an acknowledgement that tax has already been paid and if too much tax has been paid, more than required by the law, then the excess amount is returned to the individual. That is what we do for all individuals who lodge a tax return and are found to have paid more tax than what they were required to. But Labor wants to put a stop to those returns going to retirees.

When you see Labor going after money like that, it should be a concern to any voter who earns a wage and pays taxes, because if your employer deducts more tax than they should, or if you claim deductions in your tax return, Labor has flagged that they don't want to give you your money back. Once they've got your money in their grubby little hands they will never give it back. It doesn't matter if are you a worker or if you are retired, Labor will find a way to steal your money. Australians will need to ask themselves a question at the next election. Retirees will need to ask themselves, 'Will my vote enable Labor to steal money from me?' Workers should ask if their vote will help Labor steal money from mum and dad's retirement incomes. Young Australians should ask themselves if their vote will help Labor steal from nanna or pop.

I hear laughter over there. The Tasmanian member laughing should know that 20,000 Tasmanians are going to be robbed of money. Twenty thousand Tasmanian retirees will be robbed from this tax. He shouldn't be laughing. He should be hanging his head in shame for trying to rob 20,000 Tasmanian retirees. If an individual robbed nanna or pop they would go to jail and they would be reviled by the community for such a disgusting, low act.

With the bill that we are debating today the government is working to support the income of retirees. We're trying to ensure that retirees have enough income to pay for the necessities of life. The Liberal-National government understands that many retirees are often on low incomes and those incomes are fixed incomes, because of retirement plans they've put themselves in. Despite presenting themselves as a party that helps people on low incomes, and they are anything but, the Labor Party is actually promising to rob low-income retirees with this retiree tax that they are proposing. They want to force our seniors below the poverty line. The Labor Party wants to see the 20,000 retirees and pensioners in the electorates in Tasmania making tough decisions like whether to pay the power bill or whether to eat every night. They are the kinds of decisions they want. They want seniors to give away their pets, because they can't afford the pet food and they can't afford the vet.

I met with a constituent in my electorate, Mr Arnold Fanning, who is very worried about how he and his wife are going to survive under a Shorten Labor government. The Fannings have worked hard all their life. They've saved for their retirement, with fixed plans. As a result of the sacrifices that they've made their entire life, they've funded their own retirement; they do not rely on government support. In fact, they pay private health insurance to avoid being a burden on the taxpayer. However, if Labor's retiree tax came into play then the only way the Fannings could make ends meet would be to dump their private health insurance. The consequences of that decision for the government and for taxpayers would be another elderly couple accessing the taxpayer-funded public health system. There would not be a net benefit to the government under that scenario—quite possibly the opposite. With their retiree and pensioner tax, Labor would rob seniors of their dignity and of their freedom to choose their health providers.

I refer to this unfair policy of Labor's as a retiree and pensioner tax because it will affect both. The initial backlash to this ill-thought-out plan caused Labor to exempt pensioners, apparently. But what they've actually done is exempt only the people who were pensioners at that moment in time, because they wanted to take away the sting. But others who began or will begin accessing the age pension after that announcement will be subject to the same robbery and theft as self-funded retirees are going to go through. So, pensioners, make no mistake, Labor will tax pensioners under this retiree tax. After exempting some pensioners from this unfair tax, Labor now tries to paint the victims, as the member for Hinkler just said, as 'typically wealthy retirees', but almost all, 97 per cent, of the elderly victims of this retiree tax will be individuals who have taxable incomes below $87,000; 84 per cent of the potential victims of this retiree tax are on taxable incomes below $37,000; and more than half of them have taxable incomes of less than $18,200.

Mr Brian Mitchell: Taxable incomes.

Mr CHRISTENSEN: Taxable incomes. He says 'taxable incomes'. What does he want to be on—the Labor Party's imaginary income thresholds? The member who is interjecting needs to think long and hard about the 20,000 Tasmanians that are going to be affected, and he should be talking to them. The victims of this retiree tax proposed by Labor will be pensioners, part-pensioners and self-funded retirees. They have done the right thing their whole life. They've worked hard, scrimped and saved to support themselves in retirement. They've done this nation a great service by removing some of the burden on the government and on the taxpayer. They've worked hard—they've built this country—and Labor wants to reward them by stealing their hard-earned money.

I met with one of the potential victims of Labor's retiree tax in my electorate earlier this year. Jolien is 88 years old. He and his wife, Enid, are self-funded retirees. They've worked hard their entire lives and paid all their taxes—a lot of tax. They've never relied on any support from the government. In the process, they saved for their own retirement. Saving means sacrificing. Instead of spending money having a good time, going on holidays or going out every night, Jolien and Enid chose to save money so they could support themselves in their later years. That hard work and saving enabled them to do just that. They're self-funded retirees who do not receive any pension from the government.

If you believe Labor's spin about 'typically wealthy retirees', you probably think that they're living the high life, dining on caviar and champagne every night. But Jolien told me, 'Our gross income, between the two of us, is less than the current average weekly wage'—less than the current average weekly wage. He said that, under the planned retiree tax by the Labor Party, their income would be reduced by more than $10,000 a year. He said, 'On part of my personal income, it will be 64½c in the dollar on the excess imputation credits.' Corporate fat cats and bank CEOs—banks themselves don't pay 64½c in the dollar on any part of their tax. Jolien is just one of the many retirees in my electorate who have voiced their concerns about their financial future under a Shorten Labor government. They can't believe that the lifestyle for which they have worked and saved, scrimped, for decades will be pulled out from under them with the stroke of a pen.

If we really want to support retiree incomes in Australia the most important thing we can do is to stop the shifty Leader of the Opposition from ever becoming Prime Minister. We can legislate measures like we're doing in this bill today, but all that and more will be undermined if Labor's retiree tax, their attack on seniors in this country, means that investment dividends are no longer protected from double taxation. It is hard to believe that in September 2017 the Leader of the Opposition stood up in Townsville and said:

I think Australians pay enough tax at the moment. I don't believe that another tax is going to be what Australians need or want at this stage.

It is very hard to believe that. It's very hard to believe that he said it with a straight face, because Labor is now promising to tax everything that moves and impose levies on anything that doesn't.

As well as stealing money off more than one million individuals with their retiree tax, they will also hit around 40 per cent of self-managed super funds and retirement savings that are held in about 3½ million super fund accounts. They did, however, very conveniently allow hundreds of millions of dollars in franking credits to be refunded to tax-exempt organisations, also known as trade unions, that donate to the Labor Party.

The truth is that no amount of support for retirement incomes will make up for what would lie ahead in the unfortunate circumstances of having a Shorten Labor government. They would not only impose a retiree tax; they would hit them with a housing tax, with a carbon tax, with higher electricity bills and even, as the unions want, with a death tax. They are proposing to raise more money from new taxes—more money than the actual GDP of New Zealand—because they would have to pay for their waste, for their profligate spending and for their inability to run a budget. It's like the Labor Party has employed two innovation professionals: one to dream up ways of how to throw around money and win votes, and the other as some kind of grim reaper tax officer dreaming up ways to hurt people and searching for new ways to hurt them even more. This time around it's going to be older Australians. How disgusting. How disgusting to attack people in our society who have worked hard to build up this country and some of the most vulnerable in our society.

It is no wonder there was white-hot anger in Townsville recently at the House economics committee, which was conducting a public hearing for their inquiry into the implication of removing refundable franking credits. There was quite a turnout for that meeting. Many of them drove in the rain as the floods started. They drove through the rain to get to that meeting. They wanted to have their voices heard. And didn't Labor hate it that self-funded retirees and pensioners actually had their voices heard through that platform? They tried to discredit that inquiry to sweep the problems under the carpet.

They have the audacity to come in here and tell those self-funded retirees and pensioners to just not vote for them. Actually, that's the best thing I've heard. I concur with that advice from the Labor Party. The best advice for seniors right now is to not vote for the Labor Party, because they are going to come after you. Regardless of the changes we make through this bill to support the incomes of Australians in retirement, it will all come to nought if a Shorten Labor government comes to power.

Pensioners and retirees will be taxed. Seniors will be far worse off under a Labor government. It will be a case of three steps forward under this bill, and a Bondi tram one mile back. There's one thing that we've learnt about Labor: when they run out of their own money, they come after yours, they come after mine, they come after everyone's. If you're a senior, there's one thing as sure as night follows day, and day follows night: they're coming after your hard-earned. It's absolutely disgusting that they would try to rip off and steal the hard-earned of our senior Australians—people who built this country, people who are some of the most vulnerable, people who are on fixed incomes, people who are on low incomes.

I say to the Labor Party: think again, and if you don't think again you are going to be punished at the ballot box. Those 20,000 Tasmanians who receive these funds—

Opposition members interjecting—

Mr CHRISTENSEN: are going to come for you, mate; they're going to come for you. They're going to come for every single one of these Labor people. They're so smug, walking around like they've won this already. Well, I've got news for them, and so have the seniors around this country: they're going to punish Labor at the ballot box for disgracing themselves with this policy.

Mr FLETCHER (Bradfield—Minister for Families and Social Services) (18:04): I thank all members for their contributions to this debate, and I'm now pleased to sum up. Let me commence by tabling a replacement explanatory memorandum to correct a minor error. The Social Services and Other Legislation Amendment (Supporting Retirement Incomes) Bill 2018 implements measures announced in the 2018-19 budget to enhance the living standards of older Australians. The bill provides for three changes to support Australians in retirement, including new means test rules to encourage the development and take-up of lifetime retirement income products, an expansion of the Pension Loans Scheme and an increase and expansion of the pension work bonus. All three changes will commence on 1 July 2019.

The new means test rules for pooled lifetime income streams pave the way for the development of retirement income products that support greater choice and flexibility for Australians in retirement. They apply to all pooled lifetime income products held by social security or veterans affairs income support recipients that are acquired or purchased on or after 1 July 2019. Products purchased before 1 July 2019 will not be affected by these new rules. The rules will not change for account based income streams—the most common retirement income product. Under the income test, the new means test rules will assess 60 per cent of payments from a pooled lifetime income stream as income. Under the assets test, the new means test rules will assess a proportion of the total purchase amount for the pooled lifetime income stream. At the time of purchase, 60 per cent of the purchase amount will be assessed. This will continue for a minimum of five years or until the person reaches the life expectancy of a 65-year-old male, currently the age of 84, whichever is longer. After this point, 30 per cent of the purchase amount will be assessed. In situations where an income stream is sold outside of superannuation, the new rules have some additional provisions to make sure that this is factored into the means test assessment. Stakeholders in the financial product and retirement income industries have been consulted throughout the development of the new means test rules, and the new rules take into account their feedback. The new means test rules are estimated to cost $20.2 million over four years.

Secondly, this bill increases the pension work bonus by $50 to $300 per fortnight and extends the application of the work bonus to income earned from self-employment. The work bonus is an income test concession for pensioners of age pension age and veterans affairs pensioners over qualifying age that encourages pensioners to undertake work to supplement their pension. The work bonus was set at $250 per fortnight when the current scheme was introduced in 2011 and has not been increased since. Increasing the work bonus amount to $300 a fortnight will allow pensioners to retain more of their pension when they receive income from work. Because the work bonus operates in addition to the standard pension income test free area, which is currently $172 per fortnight for a single pensioner, the increase in the work bonus to $300 a fortnight will allow, for example, a single age pensioner with no other income to earn up to $472 a fortnight from employment and still receive the maximum rate of age pension. The work bonus income bank limit will also increase to $7,800 under the changes. Pensioners will be able to build up any unused amount of the $300 fortnightly exemption to a total of $7,800. This amount can be used to exempt future earnings from the pension income test, so the changes will mean a pensioner could earn up to $7,800 a year extra without it affecting his or her pension. Extending the work bonus to the self-employed will improve the consistency and equity of the work bonus. It is fair that self-employed pensioners who earn income from engaging in work should be able to access the work bonus in the same manner as pensioners who are employees. Overall, the changes to the work bonus will increase the payments of about 88,750 social security pensioners and 1,000 allowance recipients from 1 July 2019. Approximately 1,150 people will become eligible for a social security pension for the first time. Approximately 3,000 veterans affairs pensioners will also benefit. The changes to the work bonus are estimated to cost $227.4 million over four years.

The bill also expands the Pension Loans Scheme. The Pension Loans Scheme is a voluntary reverse mortgage type loan available through Centrelink to part-rate pensioners and some self-funded retirees who own real estate in Australia. Under this scheme, a person of age pension age can nominate to receive an amount up to the equivalent of the full rate of the pension, with the payment accruing as a debt secured against real estate owned by the person. The debt accrues compound interest, with safeguards ensuring that the amount of the maximum loan that can accrue is limited. The expansion of the Pension Loans Scheme will mean that the available Pension Loans Scheme fortnightly loan plus pension amount will increase to 150 per cent of the maximum rate of fortnightly age pension, including the pension and energy supplements and rent assistance where applicable. This will allow, for the first time, maximum-rate pensioners with securable real estate in Australia to access the scheme. Current arrangements that prevent some self-funded retirees from participating in the scheme will be removed. The change will also allow existing Pension Loans Scheme recipients to increase their existing pension plus loan amount up to the new threshold of 150 per cent of the maximum fortnightly rate of pension. The changes will give older Australians more choice to draw on the equity in their homes to support their standard of living in retirement. Around 6,000 eligible pensioners of age pension age are expected to take up a loan under the expanded scheme over the next three years. The changes to the Pension Loans Scheme are estimated to cost $11 million over the forward estimates.

The bill also includes technical amendments to confirm that income support recipients of age pension age qualify for the employment nil rate period, which enables pensioners with work to remain connected to the pension system for a 12-week period, allowing them to retain their concession cards and immediately return to the pension if their work ceases.

Overall, this bill will give retirees greater choice and flexibility when it comes to managing their finances in retirement. It will support home-owning retirees to receive more income in the form of a loan, and it will allow older Australians to keep more of their pension when they work. In the best interests of senior Australians, I seek the support of the parliament for the passing of this bill. I commend the bill to the House.

The DEPUTY SPEAKER ( Mr Hastie ): The original question was that this bill be now read a second time. To this, the honourable member for Barton has moved as an amendment that all words after 'That' be omitted with a view to substituting other words. The immediate question is the amendment be agreed to.

Question negatived.

Original question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Mr FLETCHER (Bradfield—Minister for Families and Social Services) (18:13): by leave—I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

The DEPUTY SPEAKER ( Mr Hastie ) (18:14): Before the debate is resumed on this bill, I remind the House that it has been agreed that a general debate be allowed covering this bill, the Income Tax (Managed Investment Trust Withholding Tax) Amendment Bill 2018 and the Income Tax Rates Amendment (Sovereign Entities) Bill 2018. The original question was that this bill be now read a second time. To this, the honourable member for Fenner has moved as an amendment that all words after 'that' be omitted with a view to substituting other words. The question now is that the amendment be agreed to.

Mr THISTLETHWAITE (Kingsford Smith) (18:15): I'm speaking in support of these bills subject to the second reading amendment moved by the member for Fenner. These bills deal with stapled structures and tightening tax concessions for foreign investors. The bills do four things. They increase the managed investment trust withholding rate on fund payments that are attributable to non-concessional managed investment trust income to 30 per cent, they modify the thin capitalisation rules to prevent double-gearing structures, they limit the withholding tax exemption for superannuation funds for foreign residents and they codify the limits and scope of the sovereign immunity tax exemption.

In respect of stapled structures, according to the government, the measures in these bills are designed to improve the integrity of tax laws relating to stapled structures. Prior to the introduction of the managed investment trust regime in 2008, profits made by stapled entities had a similar tax burden to companies. The MIT regime is aimed at increasing the attractiveness of certain funds to mobile foreign investment, lowering withholding taxes deducted from certain distributions from foreign investors. That rate is generally at 15 per cent. That means that foreign investors investing through stapled structures don't pay the company tax rate. The unintended consequence of the system is that we have foreign institutional investors being taxed anywhere between zero and 15 per cent, versus the company tax rate of 30 per cent. Obviously, that's an anomaly that we wish to clear up through these provisions.

In terms of the thin capitalisation rules that prevent double-gearing structures, these rules apply to foreign controlled Australian entities, Australian entities that operate internationally and foreign entities operating in Australia. Generally, they broadly deny deductions for debt-financing expenses if the entity's debt exceeds certain limits. Foreign investors have been entering into double-gearing structures that allow them to convert more of their active business income into interest income, which is subject to a 10 per cent interest withholding tax, or less in some cases. The explanatory memorandum states:

Double-gearing structures involve multiple layers of flow-through holding entities (trusts or partnerships) that each issue debt against the same underlying asset. This allows investors to provide a greater proportion of their capital as investor debt and gear higher than the thin capitalisation limits allow. As a result, investors are able to maintain and deduct higher levels of debt financing expenditure.

Currently, it goes on:

For the purposes of determining associate entity debt, associate entity equity and the associate entity excess amount under the thin capitalisation provisions, a trust … or partnership that is an associate of the other entity referred to in the relevant provisions will be an associate entity of that other entity if the other entity holds an associate interest of—

50 per cent or more in that trust or partnership. Schedule 2 of the Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax in Australia and Other Measures) Bill lowers that associate entity threshold from 50 per cent to 10 per cent. The explanatory memorandum states:

In addition, in determining the arm’s length debt amount, an entity must consider the debt to equity ratios in entities that are relevant to the considerations of an independent lender or borrower.

It's good to see that the government has adopted this. It's similar to a measure that Labor has proposed in our nearest reforms—if we're elected—associated with thin capitalisation rules and cracking down on multinational tax avoidance.

This proposal that we're dealing with here today in these bills doesn't go as far as Labor's proposal, but it is a step in the right direction. We would urge the government to give further consideration to Labor's proposal, which will provide greater integrity and efficiency to our tax system and ensure that we get a fairer share from companies that have had a history—in particular, those larger companies—of using thin capitalisation rules to transfer debt to other countries.

The previous Treasurer and now Prime Minister unilaterally announced, on 14 September 2017, that managed investment trusts would no longer be able to acquire residential property, other than affordable housing. This did take the property and construction sector completely by surprise, putting the potential billion-dollar build-to-rent market in Australia at risk. After more than 10 months of uncertainty and confusion, the former Treasurer, the Prime Minister, finally backflipped and changed that, allowing MITs to invest in residential housing that is held primarily for the purpose of deriving rent.

Distributions attributed to investments in residential housing that are not used to provide affordable housing will not be concessional MIT income that is subject to a final MIT withholding tax rate of 30 per cent. The Property Council supports this element of the legislation, saying that the presentation of these bills is another step towards providing greater certainty around the rules for institutional investment in real estate, benefitting millions of Australians and their retirement savings. Tax justice advocates are supportive of this measure.

A report on the use of stapled structures has led to a Senate inquiry, chaired by Senator McAllister, that looks at the for-profit aged-care sector and stapled structures. Some sovereign wealth funds and institutional investors have criticised the package for not being fully prospective and have said that the measures will create a disincentive to investment in large-scale Australian projects, including infrastructure. The Financial Services Council has opposed much of that package.

The Tax Institute has raised the issue of why the Australian Taxation Office doesn't simply use Part IVA, the general anti-avoidance rule, to target the recharacterisation of active income to passive income, to exploit low withholding tax rates designed for passive investor income. It welcomes the transitional arrangements for infrastructure as a second-best option. But some stakeholders have raised the medium-term effect on horizontal fiscal equalisation. In particular, the package largely removes the ability for states to promote the use of stapled structures to inflate asset prices for the purposes of privatisation, and state governments of various political situations have championed the use of these stapled structures to increase the sale of assets for privatisation purposes. That's something the Labor Party has had some difficulty with in previous years, particularly the sale of essential assets associated with electricity that have led to some of the massive increases in electricity prices that we've been seeing for some years.

In conclusion, Labor supports the passage of these bills. While there are measures in here that go some of the way to closing some of the tax loopholes in Australia, particularly those around managed investment trusts and changes to thin capitalisation rules, in our view the reforms do not go far enough. The government should look at the proposals Labor has put in place around a fairer multinational tax system and some of these entities that are being used by big corporations to not pay their fair share of tax in Australia. It should look at implementing the very sound recommendations that have been put forward by Labor that would be fair dinkum about closing some of these tax loopholes for multinational corporations.

Mr VAN MANEN (Forde—Government Whip) (18:24): It's my pleasure to rise in this House and speak about another package of tax measures that this government is seeking to introduce to ensure that everyone in Australia pays their fair share of tax—the Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax in Australia and Other Measures) Bill 2018, the Income Tax (Managed Investment Trust Withholding Tax) Amendment Bill 2018 and the Income Tax Rates Amendment (Sovereign Entities) Bill 2018. This is important because we need people to pay their fair share of tax to ensure that we have the funds in the budget to provide for our infrastructure, our schools and our essential services that all Australians expect and deserve. The current concessions and loopholes have leaked hundreds of millions of dollars in revenue, and it's important that we seek to close those because we can't afford to leave those loopholes and concessions unaddressed.

These bills aim to address the unintended loopholes while tightening some broad tax concessions, including, as the member for Kingsford Smith outlined, stapled structures that currently allow foreign investors to get a very low rate of tax and, in turn, get a competitive advantage over Australian investors by paying little, if any, tax. Foreign investors have been taking advantage of this system by converting trading income into more favourably taxed passive income in land-rich sectors such as infrastructure. That these tax benefits are available only to foreign investors places Australian investors and businesses at a competitive disadvantage. That these concessions are available only to foreign investors results in a two-tiered tax system that has the potential to distort investment decisions and biases investments towards those structures I outlined before. As we look across our economy, it's important that, irrespective of your structure and your business, everyone pays the same rate of tax to ensure that we have the necessary revenue for the services that we need to provide. This bill will stop double gearing so that foreign investors will be unable to shift profits to avoid tax. It will stop foreign investors getting tax concessions on their stapled structures to achieve tax rates well below 15 per cent on their Australian business income or, in some cases, be tax free. That's in stark comparison to Australian entities, who pay a corporate tax rate of up to 30 cents in the dollar.

But, importantly, these bills are the latest in a range of measures that this government has sought to introduce over the past few years that are resulting in some of the strongest taxation integrity rules in the world. However, these stapled arrangements and the broad tax concessions provide an opportunity to avoid or minimise tax, and that poses a risk to the integrity of our tax system, and these bills seek to reduce or close those loopholes. One of the loopholes that we're closing concerns trading income that is presently converted to passive income—income from agricultural land and residential housing, other than affordable housing. We will see this income taxed at the corporate tax rate for foreign investors, which will improve the outcomes for all Australians across the housing spectrum, particularly those most in need of home ownership. The proposed reforms will, again, prevent foreign investors from double gearing these investments to generate more favourably taxed income. These measures address risks to Australia's corporate tax base posed by this range of structures.

Schedules 1 to 5 of the bill amend the Income Tax Assessment Act 1997, the Income Tax Assessment Act 1936 and the Taxation Administration Act 1953 to improve the integrity of the income tax law for these arrangements, including foreign investors using managed investment trusts and the income that flows through those. Increasingly, we've seen businesses in a broad range of sectors seek to use tax structures to minimise the tax that they pay, and, with the managed investment trusts concession being used through stapled securities and similar arrangements, we've seen the conversion of active income into passive income. Further, some foreign investors have entered into arrangements that generate debt greater than the prescribed thin capitalisation debt limits by using double-gearing structures, leading to the ability to claim greater tax deductions than were otherwise available to Australian investors and therein create, as I outlined before, a two-tiered tax structure and a commercial advantage for many of these entities.

Several of these measures are specifically designed to address housing affordability for members of the community earning low to moderate incomes by providing incentives for investors to increase the supply of affordable housing. As a result, managed investment trusts will be able to invest in residential housing that is held primarily for the purpose of deriving rent. However, distributions that are attributable to investments in residential housing that are not used to provide affordable housing will be non-concessional managed investment trust income and subject to a final withholding tax of 30 per cent.

Schedule 2 improves the integrity of the income tax law by modifying the thin capitalisation rules to prevent double-gearing structures. This schedule will apply in the income years commencing on or after 1 July 2018, with no transitional period, as the amendments close a clear technical loophole in the law. The thin capitalisation rules will bring in about $400 million in revenue over the forward estimates, while helping to put Australian investors on a more equal footing by removing lower and unintended tax rates currently available to foreign investors. Foreign investors have increasingly entered into these structures that allow them to convert active business income to interest income with lower withholding tax rates.

This is just another example, as I said before, of the government seeking to address a range of issues to ensure the integrity of our tax system. Importantly, the measures that have been put in place over the last few years create a tax system that is much stronger in its tax integrity than many others around the world. And as a result, under this government, Australia is a global leader in the fight against multinational tax avoidance. Some of the measures that have been introduced have resulted in approximately $7 billion in liabilities being raised against large public groups and multinationals and around another $7 billion in sales being returned to Australia each and every year. That results in hundreds of millions of dollars of additional GST revenue, which is a direct benefit to the states.

Once again, this is a demonstration that this government is focused on making sure foreign investors pay their fair share of tax as part of their social licence for operating in Australia. This in turn ensures that we have a strong economy, resulting in more jobs and opportunity for hardworking Australians, who are looking to build and grow the wealth for their future and for their families and, importantly, ensuring that their government can provide and fund the essential services that Australians expect and rely on. It's pleasing to see that progressively over the last few years we have continued to strengthen the integrity of our tax system to ensure that everyone, whether foreign or domestic, is paying their fair share and allowing us to generate the revenue necessary to provide the services that every Australian expects. I commend these bills in their original form to the House.

Mr WALLACE (Fisher) (18:33): Mr Deputy Speaker, I know that you will be riveted to hear that the implications of this bill, the Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax in Australia and Other Measures) Bill 2018, as part of the coalition government's historic program of tax reform, are both practical and profound. People who live in my electorate of Fisher who want to invest in Australia's future will see the day-to-day benefits of the bill in the form of a level playing field, beginning on 1 July this year. But the values and beliefs that underlie this bill and our tax reform policies in general are fundamental to the weighty choice that will face all Australians at the coming federal election. It is a choice between two visions for the future of our country and between two contrasting beliefs about the success that Australians deserve.

The Liberal-National coalition want to keep tax rates as low as possible to allow people to keep more of their own money. Labor, on the other hand, want to take $200 billion more from Australians' back pockets. The coalition want to reward aspiration and ensure that hard work is not punished. Labor believe that, the harder you work, the more the government should take from you. The coalition want to encourage Australians to invest in their future and in the future of our country. Labor want to punish investment and discourage Australians from saving for their future because Labor want more Australians to be reliant on the public purse. The coalition want a tax policy which helps grow a strong economy and allows us to pay for the services that Australians need. Labor will weaken that economy with an onerous, unaffordable tax burden that will eventually drag all of us down. Our government wants a level playing field. We want to ensure that the tax rules are the same for everyone, regardless of wealth, size of corporation or geographical location. Labor want different rules for different people, unfairly targeting retirees or hardworking families who own an investment property.

That is the contrast between the coalition's historic tax reforms and Labor's shameless tax grab. That is the context of this bill and the tax reform program in which it fits. In particular, it is an encouraging domestic investment in ensuring a level playing field where this bill will have its impact. Schedule 1 of the bill will ensure that a foreign investor cannot take income they derive from trading in Australia and avoid paying the full rate of tax on it by converting it through what is known as a stapled structure into passive income from agricultural land or residential housing. Until now, these stapled structures have allowed foreign investors, and only foreign investors, to achieve effective tax rates of less than 15 per cent, far lower than what Australians would ordinarily pay. It has also allowed them to get an unfair tax advantage over Australian citizens who want to invest in our domestic, agricultural or residential property. The coalition government encourages foreign investment in Australia. However, we believe that, if you earn an income in Australia, you should pay the same tax on that income that an Australian must pay.

Schedule 2 of the bill prevents foreign investors from creating layers of trusts which can convert the active business income that investors have gained into interest payments taxed at a much lower rate. The bill would group these trusts together, apply the same so-called thin capitalisation rules to them as apply to other entities investing in Australia and thereby ensure that they cannot be used to create large debt deductions and reduce the tax owed to Treasury.

Finally, schedules 3 and 4 would reduce the tax exemptions enjoyed by foreign pension funds and sovereign wealth funds. While the government want to encourage overseas pension funds to invest in Australia, currently our tax incentives to do so are far more generous than most equivalent countries afford to Australians. We need to redress the balance and ensure that our investors are not comparatively disadvantaged by the excessive concessions that we grant to overseas funds.

Importantly, however, the government recognises that there are high areas of need in Australia where additional tax incentives for foreign investment are in fact appropriate. With a rapidly growing population, we face a considerable need for new infrastructure and more affordable housing right across this country. As such, the government has built in, for example, a pragmatic exemption to schedule 1 of this package for 15 years for nationally important infrastructure projects and has included in the bill further support for affordable rental housing. It's ensured that these measures were developed in close consultation with industry groups, businesses, investors and other tiers of government across two years of discussions. We have ensured that there are transition arrangements built in of between seven and 15 years in the case of existing arrangements to make sure that no-one is unfairly disadvantaged. These reforms are targeted and pragmatic, ensuring a level playing field without discouraging the investment that we so badly need in this country.

In total, closing these loopholes will ensure that Treasury recoups around $400 million over the next four years in taxation which foreign investors would otherwise have avoided paying. That's $400 million in unfair advantage negated, and $400 million that the government can put towards the services on which Australians rely. If left unchecked, this loss of revenue could have grown into the billions, as more foreign investors would seek to take advantage of the loopholes, to the serious detriment of Australian domestic investment.

Overall, as I've sought to describe, this bill is an essential element of the coalition's wider taxation reform package, helping to ensure a level playing field, enforce the same rules on all and encourage domestic investment. In assessing the merits of this bill in its wider context, the House should consider what the coalition's taxation reform package has already delivered for all Australians. Sixty thousand people in my electorate of Fisher, for example, are already better off because of the coalition government's tax reforms. Working Australians who live in communities like Caloundra, Beerwah, Maleny or Mooloolaba are seeing up to $530 more in their pay packets every year. Ordinary families in those communities, in towns like Kawana, Alexandra Headland, Beerburrum or Landsborough are getting up to $1,060 back from this government. We've passed further reform which ensures that 94 per cent of Australians, including residents of Fisher, will never have to pay a marginal tax rate of more than 32½c in the dollar.

We believe that if you choose to put in the effort to succeed, you deserve to enjoy the fruits of that aspiration. At a time when wage growth is low and when bills for electricity and housing are high, the coalition government has acted responsibly and pragmatically, and said to people in my electorate, 'We are not going to take any more of your money than we absolutely have to.' Small businesses in Fisher that are creating the industry and jobs of our future are already feeling the practical benefits of the coalition government's policies. Companies like Helimods at Caloundra Airport, Eniquest in Bells Creek and APAC Infrastructure in Caloundra West are already investing in new products and offering new jobs in the knowledge that the return on those investments will be greater under the government's corporate tax cuts. Day-to-day businesses on which local residents rely, like CK Whole Foods in Mooloolaba, Maleny Jewellers, and Peachester Fuel and General Store, have been given greater confidence that they can earn, employ locals and invest for the future, because this government is taking less of their income every year.

We all see the benefits in thriving shopping districts and a low unemployment rate across this country. The bill we are considering today will further encourage that sort of confidence and that investment by ensuring that overseas investors are not receiving an unfair advantage which increases their returns and makes it harder for domestic businesses to compete. The people of Fisher and its local businesses are already experiencing the positive practical impact of the coalition government in their pay packets and on their balance sheets. This bill will support them further.

Under Labor, my constituents would receive none of these practical benefits. Labor voted against our personal income tax plan. They voted to take $70 billion more from taxpayers, including from the back pockets of 60,000 working Australians in Fisher. Labor have promised to repeal the coalition government's company tax cuts and undermine the investment decisions taken by tens of thousands of businesses in my electorate. Labor have promised more than $200 billion in other new taxes on housing, electricity, small business, investment, income and even pensions. Every day, whether you're a working Australian, whether you're an Australian investor or a small business owner or a retiree—it doesn't matter—you'll better off under the coalition than you would be under Labor.

But the debates over taxes that have taken place in this parliament reveal something more fundamental about our competing visions for Australia. Members of the Liberal-National coalition believe that the success that Australians want is a success built on hard work, investment for the future, and personal responsibility. We believe that Australians want the satisfaction of knowing that they have earned what they have, that they have provided for themselves and their loved ones, and that they've helped to build Australia's future. Labor have fought tooth and nail to stop us implementing our historic tax reforms at every stage, because Labor don't believe in aspiration; some of them don't even know what it means. They don't understand it. Labor don't believe in rewarding hard work and investment for the future or celebrating the success of ordinary people. For them, the more you work, the more the government should take. Labor demonise achievement. They punish hard work and they penalise investment, because Labor believe that the only success Australians deserve is the success that the government hands out.

That is the choice that faces the people of this country: opportunity and prosperity under the coalition, or Labor's politics of envy. I know which Australians will choose. I encourage this House to do the same by supporting this bill and helping us progress the vital work of tax reform today.

Mr PITT (Hinkler) (18:46): I rise to speak on the Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax in Australia and Other Measures) Bill 2018. This bill addresses unintended loopholes and tightens some of the broad tax concessions that allow foreign investors to get a very low tax rate and a competitive advantage over Australian investors. But while I'm on my feet, we should look at a few things in terms of comparison with those opposite, because we've heard over many years their shrill screams about multinationals and companies in Australia that haven't paid any tax. Well, I've got news for those opposite. There are some rules around taxation in this country—some very important rules. And I think the first one is this: if you don't actually make a profit then you don't pay any tax. Those opposite have made calls about Australian companies who haven't paid tax for a particular year. Mr Deputy Speaker Goodenough, I know you've been in business yourself, and the minister at the dispatch box is probably in a similar position, and the member for New England in front of me—you have had experience in employing people and setting up business structures and companies, paying tax to the Australian government. But those opposite certainly have it wrong.

There are things that happen to companies and businesses in this country that mean that they don't make a profit. I was in business for more than 15 years before I came into this place. There were years when I didn't have a tax bill because I made a loss. At that time, you dip into your overdraft or you dip into your savings or your previous years' earnings, and you use that to keep your business going, to pay your wages and to keep your staff in their jobs. They are the things that companies in this country do. So, I think these shrill screams about multinationals and for more tax to be paid by companies in Australia need to be tempered by the reality of what happens in business. It is one day of the year when you assess your position, on that day, for your taxation responsibilities to the Australian government, and if you owe them you pay them. It is very straightforward.

In terms of profit shifting for multinationals, we've already cracked down on that, and the proof of the pudding is in the eating: more than $5 billion has been recovered. That is an enormous amount of hot dogs down the road for those who might be looking for support. And can I say, we know that those opposite do know something about taxes. They know that they like to hand them out. The proposal that they are taking to the next election is a tax hammer to the Australian economy: $200 billion in additional taxes and costs.

I know, as a previous owner of a business, that you make decisions based on a couple of things. You make decisions based on forecasts and you make a decisions based on confidence and your bottom line. The stronger your bottom line is the more likely you are to invest, to take calculated risks and to employ more Australians. We've been successful over the past six years. More than a million jobs have been created in this country. I think that has been incredibly beneficial. We have at the moment one of the lowest unemployment rates for many years. It comes down to the structures we've put in place to help businesses be successful, because at the end of the day a profitable business employs Australians in this country—and they all pay tax. But we know that that is not enough for those opposite. They want more money to spend on the things that they want. The difference between us and them is that we want Australians to keep more of their money to spend where they want it, so they can make a decision about where their kids go to school, not necessarily pour it into government coffers for Labor's ideology.

We know what will happen to running costs. One of the things that I was surprised—in fact, absolutely gobsmacked—about during my period in business was the increase in the cost of electricity. Without a word of a lie, I started with an irrigation tariff of around 12 cents a kilowatt hour. It is now in the high 20s. If you were in business, your electricity bill was not in the top three costs for your operation unless you were a large energy user. It is now in the top two. Minister Angus Taylor and I met with a small-business man last week. Electricity is now his third highest cost after wages and rent. This is a coffee shop. It is not a huge operation that requires enormous amounts of energy. It is unsustainable. You cannot continue to have such high energy costs. Yet, those opposite want to increase it again. They want to implement a 50 per cent renewable energy target, with intermittent wind and solar. We know exactly what would happen. You can go to South Australia. It has the highest electricity costs in the world. What would that mean for regional Australia? It's pretty straightforward. It would mean a loss of jobs and businesses.

Minister Taylor and I attended the Bundaberg Foundry in recent weeks. They have been in place for 130 years-plus on the Burnett River in Bundaberg, providing training and services. They employ over 100 people and have done for a very long time. On 30 June next year, when their existing energy contracts expire, their costs will go from $1 million to $1.7 million in one year. For a business with a turnover of $40 million—and I know all of those in the House at the moment who have ever had a business know what the margins are—$700,000 is a very substantial amount off your bottom line, and the question will then become one of viability. So I say to the Queensland government, because they are solely responsible: you need to take action. We have called for years to make changes to tariffs. In fact, the tariffs that they are suggesting is 48 cents a kilowatt hour for a commercial business. Forty-eight cents! That is just unsustainable.

I do not want this business to leave my local district. They have trained literally thousands of people—apprentices, trainees—over more than 100 years. We need them to stay because they are a mainstay of what happens in regional Australia. But we need to ensure that our taxation system in fair, so we are reducing the taxation rate, particularly for small business. Those opposite want taxes to increase. We want people to be competitive. We want their businesses to grow. Those opposite want to take more off them to subdue what they do, every single day, week, month and year, to ensure that their life is more difficult and their business is more difficult to operate.

This is a pretty straightforward contest. On that side, they want to take more taxes from every Australian. On this side, we want them to have more in their pockets, so they have more reliability and more money on the bottom line, and so they employ more Australians so our economy continues to grow. It is very straightforward. Taxation for them means changes in negative gearing. The stated goal of those opposite is to drive down the value of every Australian's home, to drive down the value of their home. The silence is deafening. I admit there are only a couple of us in here, but how is it possible for them to go to every Australian home owner and say: 'We want the equity in your house to deteriorate. In fact, we want it to go so low that the bank will come and take it off you'? That is just outrageous. These people have invested at a time when they could. They saved their deposits. They work hard. A potential Labor government change in taxation policy that would take their houses away from them is not in the interests of anyone. It's not in their interest. It's not in the nation's interest. It's not in the economy's interest. We are deadset against those changes. We need to ensure that a Labor government is never elected in this country, because they will destroy our economy.

You only have to look at what we are doing with the tax offset. My electorate are not high-income earners. In fact, their average every year is around $34,000. It is just $34,000 for their median income. For them, it's approximately a $500 change. Some 49,000 individuals in my electorate will gain the tax offset of around $500 after the end of the financial year in 2019. That makes a big difference to them. Once again, in comparison, we know the retiree tax from those opposite will take, on average, $2,200 from 5,500 retired Australians in my electorate. They use that to pay their rates bill, they use that to pay their electricity bill and they use that to pay their everyday costs of living. It is not a lot of money. They are entitled to it. Those opposite suggest it is a loophole for someone who hasn't paid tax. Well, they have clearly paid tax. That's how they got a return. When they lodged their return on 30 June, their income is either less than the threshold or less than the rate and they get a return on the taxation paid on their behalf through shares. It is very, very simple and very, very straightforward.

The legislation before the House is very straightforward. It is intended to stop double gearing so that foreign investors can't shift profits to avoid tax. It is about stopping foreign investors from getting tax concessions on stapled structures to achieve tax rates of 15 per cent or less or, in some cases, being almost tax free for Australian business income. We need to ensure that every Australian company has the same advantage as those who want to come from overseas to invest here. Let me be very clear: we need foreign investment. Our country is built on foreign investment. But that foreign investment needs to be fair and should not disadvantage Australian companies, Australian businesses and, in particular, Australian superannuation funds.

While I'm on my feet, I will again put out a call to the Australian superannuation funds: take Australians' money and invest it in the Australian nation. It can be in infrastructure, housing, hotels or agriculture. To be pretty damn frank and blunt, I don't care where it is as long as it is Australian super invested in this country for every Australian's benefit. In fact, if superannuation funds went to their members, put a check box on those forms that they make you fill out every single year and asked them their members they wanted more investment in Australian infrastructure or in Australian agriculture, I think it would be overwhelmingly a yes. For the life of me, I can't understand why Australian super funds are so hell-bent on investments in agriculture and infrastructure in the United States, in Canada or in other countries, but they are not as interested in investing in this country. I've called for Australian investment before, and I will call for it again.

While we are talking about it, the changes to the bill include taxes on foreign investors' income from Australian agricultural land and Australian residential property other than affordable housing, disability accommodation and management investment trusts at the top corporate tax rate. It provides transitions for periods of seven to 15 years for existing investments. It allows for a 15-year concessional rate for investments in new nationally significant infrastructure, as determined by the Treasurer, and implements the government's budget commitment to support affordable rental housing by providing a 15 per cent tax rate. As I said earlier, we have already made changes to those multinationals who might be looking to avoid tax in this country. That has resulted in $5.6 billion of additional income from those now taxpayers to the Australian government, which can be used for many, many things that are helpful and beneficial to the Australian people.

In the short time I have left, I want to again put out a call to the Queensland Labor Premier, Annastacia Palaszczuk. Premier Palaszczuk has been sitting on her hands for months when it comes to the national health agreement. Why is it important? Because the health minister has $8 billion on the table for Queensland's public hospitals. This is not fiddlesticks; this is $8 billion. Can you imagine the nurses, the doctors, the support and the surgeries that can be conducted with $8 billion? Yet she flat out refuses to sign the agreement and even has the gall to say that there have been reductions from the federal government for funding for public hospitals in Queensland. It is an absolute nonsense. In fact, for the Wide Bay Hospital and Health Service area, our funding is up 37 per cent— that's federal funding. The reduction that is in there came from the state government. The Labor state government dropped $16 million out of my area and tried to claim that it was the feds. Well, this is rubbish.

I say again to Premier Palaszczuk: get out your pen, sit down at your desk, sign the national health agreement and deliver $8 billion for the people of Queensland to support their health, because, quite simply, they need it. And while she's at it she should sign the Skilling Australians Fund—$240 million just for Queensland. It will deliver 50,000 apprentices and trainees. Anyone who lives in Queensland, anyone who lives in the regions and anyone who lives in the cities knows that we need more apprentices and trainees because we need to deliver those skills into our economy. And there is no more important part of the Australian economy than the regional economy. We have had massive reductions in the number of apprentices and trainees who are coming through the system.

I'm the beneficiary of an Australian apprenticeship. I'm an electrician by trade. I was fortunate enough to land an apprenticeship at a local sugar mill, but that sugar mill is now closed. It is not there anymore. So I say again to the Labor Premier, Annastacia Palaszczuk: sign the national health agreement and sign the Skilling Australians Fund. The sarcastic side of me thinks that she is not signing up only because there is a federal election on the horizon and she wants to stand up with the Leader of the Opposition and complain about how hard done by the Queensland state has been. Sign the agreement. We will deliver the money that is necessary and it will be delivered now. It is ready now. The Minister for Health is ready to put forward $8 billion just for Queensland, on top of what's already there. This is a massive increase and it is necessary.

The changes to the Treasury laws make substantial and necessary changes that are to the benefit of the Australian country, the Australian people and the Australian nation. Of course, I commend the bill to the House.

Mr LEESER (Berowra) (19:01): It's always such a privilege to follow the member for Hinkler. The member for Hinkler represents his constituency incredibly well. He is a doughty advocate for them. He and I are neighbours in terms of our offices being next to each other. He also sits next to me in the joint party room. He provides lots of good pastoral care for new members like me. And, as people listening to this debate will have recognised, he is a tremendous voice for his community in Queensland—a community very different to mine in Berowra but whose values are very similar, and Berowra is a community that would be concerned, like his community, about ensuring people pay their fair share of tax in Australia.

Like the member for Hinkler, I have a bias in favour of foreign investment. Foreign investment has helped build this country. First we had British investment in Australia, and we had the Americans. In more recent times we've had the Japanese and now we have the Chinese and the Indians. We have a range of different foreign investors, and foreign investment is always a good thing for Australia because this country simply doesn't have enough capital to build the things that we need to build here.

But Australians, rightly, ask questions about foreign investment where they feel that the playing field is not level. The purpose of these laws, in this cognate debate, is to level the playing field to make sure that foreign investors are paying their fair share of tax here, to ensure that they're not hiding behind particular structures and getting particular advantages that they might not otherwise get and to ensure that markets are not distorted. This is a fundamental principle of what we're trying to do as a government.

The performance of the Australian economy has relied on foreign investment. When you think about Australia's economic performance over more than a quarter of a century now, we are the envy of so many countries for the duration of our economic growth—and the 1.2 million jobs that we've created in the five years since we've come into government. With a growth rate of 2.8 per cent, we are second only to the United States in terms of growth rates in the OECD. Our unemployment rate has fallen to 5.1 per cent, which is just extraordinary. Our levels of welfare dependency as a country have fallen to 14.3 per cent, the lowest rate of welfare dependency in 30 years. That's just extraordinary. This only occurs if you've got the economic settings, investment settings and tax settings correct and if you've got a government that's focused on these things. That's why I was so pleased to hear the Prime Minister announce his plan for 1.25 million new jobs.

So what role does this bill play in strengthening the Australian economy, levelling the playing field and ensuring that investment continues in an orderly and helpful way? In the second reading speech, the Assistant Treasurer made a number of key points, and I might just pull out a couple of those points about this bill which I think are very important. The bill implements measures that the government announced to protect the integrity of our corporate tax system. As we know, taxpayers in the main comply with Australia's tax rules and pay their fair share of tax here. I've sat on the House Standing Committee on Tax and Revenue for the duration of this term, and Australia has an interesting statistic, an interesting fact: more than 75 per cent of Australians use an accountant to comply with their tax obligations. That, I think, helps the quality and the level of compliance with our tax laws generally.

But we know some foreign investors have been using complex arrangements which are known as stapled structures and other tax concessions in order to get profits from Australian businesses basically at a tax-free level, and that just can't continue. The way they do this is by taking trading income and putting it into more tax-favourable passive income, and they do this in land-rich sectors like infrastructure. When you take that and you combine it with the existing concessions for foreign pension funds and sovereign wealth funds, some foreign investors can achieve tax rates well below 15 per cent on their Australian business income and in some cases are almost tax free. Hardworking Australian families who are paying their fair share of tax look askance at some of these arrangements, and they say: 'Well, I'm a citizen of this country. I'm a taxpayer of this country. I'm abiding by the rules. Why are these foreign companies able to get away with doing this sort of thing?' These tax benefits aren't available to Australians; they're only available to the foreign investors. So it places not only Australian individuals but also Australian businesses at a competitive disadvantage because these things are only available to foreign investors. What we end up with is a two-tiered tax system which effectively means that we get distorted investment decisions. It effectively says to people: 'Invest in land-rich things. Don't invest in companies. Don't invest in things that are actually growing the economy more broadly.'

Stapling and the broader tax concessions pose serious threats to the integrity of our corporate tax system, and use of staples has become quite widespread in infrastructure, in property, in renewable energy and in agriculture. Meanwhile, access to concessional withholding tax for foreign investors has spread much, much further than it was ever intended to, and this is particularly the case in the agriculture and residential housing sectors. We know how strongly Australians rightly feel about Australian ownership of agriculture, because agriculture is obviously an important industry for the country economically but it's also important culturally. Australia has always had a very strong agricultural sector. It's one of the things that we are best at in the world, it is one of our key economic strengths, and it's something that Australians feel deeply connected to even if they have no personal connection to farming and agriculture more generally. They want to have a sense that Australians will continue to own agricultural produce. I know that in my own electorate, where we've got some small semirural areas producing things in the horticultural sector, particularly large horticultural production, people feel very proud that there's such a strong sense of Australian ownership of the horticultural sector.

The other issue in relation to different tax structures, besides the fairness as between Australian companies and individuals and foreign companies, is large amounts of revenue forgone. There are estimates up to hundreds of millions of dollars, and it could be as much as billions of dollars that Australians are not getting as a result of these arrangements that the foreign investors make. This means that ultimately there are fewer opportunities for governments to spend more on infrastructure, to spend more on health and education, to spend more on our defence and securing our borders—all the key things that Australians want us as a government to spend money on. If we were able to pass this important legislation, we would have more money coming into revenue that is not being raised from Australians but being raised from foreign investors who heretofore have sought particular structures in order to minimise their tax.

We've got some of the strongest tax integrity rules in the world, and I think we should be very proud of them. We talked to the tax commissioner on the House Committee on Taxation and Revenue. This is a point that he regularly makes. It's important to note that this suite of legislation is part of a whole range of legislation that the government has already introduced, including multinational anti-avoidance laws, the diverted profits tax laws and country-by-country reporting, which has been very important in further bolstering the integrity of the tax laws in this country.

The measures in the bill build on the government's work in protecting the integrity of our corporate tax system. It is absolutely fundamental that we all pay our fair share of tax to ensure that the government is able to continue to provide the services that Australians want and that they deserve, whether it's schools and hospitals or whether it's infrastructure like NorthConnex in my electorate, a $3 billion road that connects the M1 to the M2. The federal government's contribution to that road is $412 million. But that money has to come from somewhere, and it comes from the taxation receipts of the Commonwealth. At the moment, the foreign investors haven't been paying their fair share of tax. These bills are designed to level the playing field to ensure that they can't take unfair advantages that are not available to Australians.

The bill neutralises the tax benefits delivered by staples by ensuring that active business income is taxed at the top corporate tax rate for foreign investors. The government's intention in introducing this package is so that active income that is converted to passive income shouldn't have access to concessional rates. The Australian Taxation Office will continue to closely monitor this area to ensure that that is actually happening and will take strong action. I know Commissioner Jordan and will take that action if it's necessary. Consistent with the Australian Taxation Office's taxpayer alert, the government expects that our anti-avoidance tax laws—known as part IVA of the tax legislation—are well understood and a litigated part of the tax law. It's fair to say they will continue to apply to egregious tax-driven arrangements such as royalty staples. This is very important. This bill delivers on our promise as a government to protect Australia's corporate tax integrity. That's what we have to do to ensure that taxpayer dollars are spent prudently.

One of the things that I note in the amendments that particularly pleased me is what is happening in relation to student income. The amendments to schedule 1 of the bill remove provisions of the bill that meant all tertiary student accommodation—for example, a purpose-built student accommodation development—would have been subject to the 30 per cent managed investment trust withholding tax. This amendment has been in response to some key views that were raised by some stakeholders at the Senate Economics Legislation Committee that looked into the parliamentary minutes to the Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax in Australia and Other Measures) Bill.

Student accommodation is very important. Prior to my becoming a member of parliament, I spent four years working in the higher education sector. Student accommodation is particularly important at our universities right across the country because, without adequate student accommodation, we don't have adequate places for not only overseas students but also students from rural and regional parts of Australia. There is a great deal of importance in encouraging and enabling more students in rural and regional parts of Australia to enter the higher education market.

I note that the Minister for Education is the minister at the table. He represents a rural and regional constituency in Wannon. He has been doing a terrific job implementing the recommendations of Professor Halsey in his review and knows well the difficulty that regional and rural families face in getting and paying for student accommodation in universities that are outside the areas in which they live. That's such an important thing, so I was particularly pleased to see the government looking at this important question. I commend both the Assistant Treasurer and, importantly, the Minister for Education on the work they are doing. I'm proud to be the chair of his government members committee in that regard.

This bill is an important integrity bill. In order to ensure the bill's safe passage, there won't be specific rules for management investment trusts for tertiary student accommodation, and I think that's an important thing. Instead, consistent with all other premises, the application of the higher withholding tax rate treatment outlined in the bill will now depend on whether a tertiary student accommodation development is considered to be a residential dwelling asset, under the general definition considered in the bill. This amendment doesn't affect our clear intent that other residential property, such as houses, apartments and build-to-rent developments of which we see so many now, will be subjected to a managed investment trust withholding tax rate of 30 per cent. But it does acknowledge that student accommodation is in a completely different class and that there is a public good as a result of that student accommodation.

The amendments also provide that premises used primarily for the provision of disability accommodation under NDIS or regulations yet to be made can receive concessional managed investment trust taxation treatment, despite being residential premises. I note that the minister at the table had responsibility for the NDIS before he became Minister for Education, so he will understand these issues of disability accommodation very well. People with disability are often at a real disadvantage, in terms of finding quality accommodation, and so the provision of more accommodation—and more accommodation that is fit for purpose for their needs—is absolutely vital. The amendments also don't change the requirement that a managed investment trust investing in land must invest for the primary purpose of deriving rent, and that seems to be a fair and reasonable integrity measure.

I think the government's bill here is good. Some of the amendments it's brought forward are very useful, and I encourage all members to support the government's program, in making sure foreign investors pay their fair share of tax.

Mr HOWARTH (Petrie) (19:17): I'm very happy to rise and speak on the Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax in Australia and Other Measures) Bill. As the previous speaker said, what we want to see as a government is foreign investors and Australians pay their fair share but—particularly for Australians—that they don't pay more than they need to. We're just asking that everyone pay a fair amount so we can continue to deliver those essential services. We've seen massive economic growth over the last 5½ years of the coalition government, with some 1.2 million jobs created and a target to create another 1.2 million over the next five years. We've seen unemployment at five per cent.

As the economy continues to grow and strengthen we're able to reduce taxes for many Australians, which is really important as well. We want to make sure, and I want to make sure as the federal member of parliament representing the seat of Petrie, that foreign investors pay the right amount of tax. It's a privilege for them as non-Australians to be able to invest in Australia, but it's important to make sure they pay their fair share. This bill addresses unintended loopholes and tightens some of the broad tax concessions that allow foreign investors to get a very low tax rate and a competitive advantage, in some cases. Current concessions and loopholes are leaking millions in revenue that could turn into billions, if left unchecked. That's why the government is putting this amendment in place now.

The legislation stops double gearing, so foreign investors can't shift profits to avoid tax. It stops foreign investors getting tax concessions on stapled structures to achieve tax rates of 15 per cent or less or, in some cases, almost tax free on business income. As you know, we've had a debate in this place, over the last term, about company tax and lowering the company tax rate to 25 per cent, which we've been able to do for SMEs, small and medium enterprises, with a turnover of up to $50 million. For companies above that, their tax rate is 30 per cent. But what we're seeing with this loophole is that some are able to pay a lot less, so this step will tighten that up. I say to everyone in my electorate of Petrie that this is an important step. Stapled structures were historically used to facilitate complementary, but separate, trading business being carried out in a company and in a trust. They've been able to basically split it so the tax rate is only 15 per cent, rather than 30 per cent, which is what we want to see them pay.

This bill also taxes foreign investors' income from Australian agricultural land and Australian residential property in managed investment trusts at the top corporate tax rate. It does provide transitional periods for existing investments. We know that foreign investment is important, and we want to make sure that Australians can also invest overseas, so it's important to have a reciprocal arrangement. Some foreign investment is important, but I also know that not everyone in my electorate likes foreign investment, so they'll be pleased to know that we are acting on this.

As part of the government, as a member of parliament and as a member that represents the seat of Petrie, I want to see lower taxes for the people I represent. I really want to see lower taxes. At the moment everyone in my electorate, whether it's myself, a doctor, someone who works on the council, someone who works at the local cafe or someone who is 68 and has a part-time job—whoever it is—gets $18,200 tax free. You get the first $18,200 tax free. After $18,201, up to $37,000, people pay 19c in the dollar. That means they get to keep 81c of everything they earn, which I think is fair. It's good. We then have a 32½ per cent tax rate—a third of what you earn, you pay in tax—for $37,000 and above. It used to cut out at $80,000; the federal coalition government this year has raised that up to $90,000. The benefit to the people in my electorate earning up to $90,000 over the last few years is that, on the $10,000 worth of money that they're earning, they're paying a 32½ per cent tax rate rather than a 37 per cent tax rate. That means that they're saving, effectively, 4½c in every dollar on $10,000, which is important if they're saving for a home loan, they're putting kids through school and they have school expenses, they just want to save for a family holiday or they're a young couple who are about to get married and are trying to get a deposit together—they can both save that extra money.

We have gone further. Because the economy is growing and because we believe in lower taxes, we've now legislated right up to $200,000 that you can only pay 32½c in the dollar, so you'd actually keep 67½c. I think that's really fair. It provides incentive for people to work harder and not be taxed at 37 per cent or 45 per cent, plus the Medicare levy. That's a great incentive, and, with a strong economy, we can continue to do that. We can continue to lower taxes. We can come back to surplus—which is what we'll see when we deliver a budget on 2 April of this year—for the first time since way back when John Howard and Peter Costello delivered the last budget surplus. That's very important. We can continue to invest in social services, roads, infrastructure, sporting facilities and all the things that are important to the people in my electorate.

We know that foreign residents pay 32½c in the dollar from the first dollar they earn, and I think that's fair. As Australians, we get a benefit of $18,200 tax free and then the lowest rate of 19c, but if you're a foreign resident you'll pay up to 32½c this financial year for up to $90,000.

This is in stark contrast, of course, to those opposed to what we're trying to do here: the federal opposition. They want to see higher taxes for people in my electorate. They want to see higher income taxes. I say to those living in my electorate that this is the wrong time to do that. We've got a strong economy; the economy's growing. I want to see lower taxes; the opposition want to see higher taxes. They don't want to see 32½c right up to $200,000; they want to tax people living in my electorate at 45 per cent and 37 per cent, killing incentive. Considering, as I said a moment ago, that this will be the first time that we've come back to surplus in a long, long time, this is absolutely the wrong time to do it.

Labor actually have a policy that they're going to take to the election this year of not just increasing income taxes which have been legislated and reduced but increasing taxes right across the board—some $200 billion over the next 10 years. I say to people that that will be bad for the people of Brisbane and Moreton Bay. That will be bad because it's not just about income tax rates; the opposition want to see higher taxes on businesses. They voted so many times, over and over again in the last term of this parliament, to keep taxes on small and medium-sized enterprises in my electorate at the higher rate of 30 per cent. As I said, we've managed to get it through at 25 per cent, but they voted to keep it at 30 per cent for places in my electorate, whether it's a local cafe or a local restaurant, or perhaps East Coast Bullbars in my electorate, or all the businesses in the Narangba business district and the Clontarf business district, which employ a lot of people. They voted for higher taxes. They just don't understand that business actually employs so many local people in my electorate. That's why I want to see lower taxes: so that there are more jobs and there is more investment locally.

I'm also terribly concerned about a part of the new taxes that the opposition want to bring in and the effect that they will have on retirees who have saved for their retirement. Effectively, Labor's retiree tax will mean that retirees will no longer receive an $18,200 tax-free threshold, because, if they're receiving their income through shares that they bought to save for their retirement and they're not on the pension—or they might be part-pensioners in the future—they will actually pay a rate of 30 per cent, which I think is really the wrong way to go. I stand for lower taxes. The government stand for lower taxes. We have a plan to continue to create jobs, which will mean that we can continue to offer those lower taxes, whereas those opposite don't.