Mr BUTLER (Hindmarsh—Minister for Health and Aged Care and Deputy Leader of the House) (09:35): I move:

That this bill be now read a second time.

The National Health Amendment (Supporting Patient Access to Cheaper Medicines and Other Measures) Bill 2024 will support a strong pharmacy sector, deliver cheaper medicines and better patient outcomes through expanded pharmacy services right across the country.

The Albanese government very proudly has already saved Australians more than $370 million on the cost of their medicines.

This bill supports implementation of the Eighth Community Pharmacy Agreement (8CPA) reached between the Australian government and the Pharmacy Guild.

Negotiations for the 8CPA began in August 2023, and the agreement has been developed following over 100 meetings with more than 20 stakeholder organisations with an interest in better health for Australians through cheaper medicines.

The 8CPA supports the objectives of the National Medicines Policy—equitable, timely, safe and reliable access to medicines and related services, at a cost that individuals and the community can afford.

It will provide pharmacies with predictable remuneration to support a sustainable, efficient, and effective network of community pharmacies across the country.

This bill delivers key elements of the 8CPA, including establishing an additional community supply support (ACSS) payment for eligible supplies of pharmaceutical benefits made by approved pharmacists.

The new ACSS payment will be paid to approved pharmacists separate to the existing Commonwealth price based mechanism for payments on dispensing pharmaceutical benefits.

This will provide a means through which the Commonwealth is able to provide the necessary level of financial support to community pharmacies for the dispensing of Pharmaceutical Benefits Scheme (PBS) medicines, without increasing the costs of medicines for some patients.

The government is also replacing the optional $1 discount with a $1 reduction in the PBS co-payment for all patients.

The optional $1 discount was failing to drive competition and make medicines cheaper for most prescriptions at most pharmacies. It was particularly failing for patients outside of the inner cities.

The vast majority of people did not get the existing optional $1 discount—around four in five subsidised prescriptions were not discounted in 2023.

Of the scripts that were discounted, 76 per cent went to patients in the inner cities.

Outside of the inner cities, only one in seven subsidised prescriptions had the $1 discount applied.

Patients cannot take advantage of the $1 discount if there is just one pharmacy in town and no price competition.

The independent Review of Pharmacy Remuneration and Regulation in 2017 recommended the former government abolish the $1 discount for this very reason: it worsens inequities, it does not address them.

The former government ignored this recommendation and allowed these inequities to continue.

The independent review said this: 'If the government considers that lower copayments are desirable, they should lower them for all consumers, with appropriate remuneration provided to pharmacies for dispensing.'

That is exactly what we are doing: we will make medicines cheaper on every script at every pharmacy and in every community, as we phase out the measure that currently only benefits some.

This will be achieved by freezing indexation of patient co-payments. There will be a one-year freeze in indexation of the PBS general patient maximum co-payment and a five-year freeze in indexation of the PBS concessional patient co-payment.

This will mean that the cost of PBS medicines will stay lower for longer, instead of rising with inflation. This will help Australians with cost-of-living pressures, and help people to keep taking their necessary medicines.

Going forward, all patients will have more equitable access to cheaper medicines, particularly those in rural and remote areas whose access to pharmacies offering the optional $1 discount has been very limited.

We are committed to ensuring that all Australians are able to access high-quality health care. This includes timely, reliable and affordable access to necessary medicines through the PBS, supported by the reforms in this bill.

In closing, I thank the negotiating teams from my department for their extraordinary work, as well as the negotiating team led by Anthony Tassone from the Pharmacy Guild, who also worked to deliver this very good outcome for patients and for community pharmacies across the country.

I commend the bill to the parliament.

Debate adjourned.

Dr LEIGH (Fenner—Assistant Minister for Competition, Charities and Treasury, Assistant Minister for Employment) (09:41): 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: Department of Defence—Submarine Rotational Force—West, Priority Works, HMAS Stirling, Perth, Western Australia.

The Department of Defence is proposing to deliver new and upgraded facilities and infrastructure to support critical operational, maintenance and sustainment functions for the Submarine Rotational Force—West at HMAS Stirling, Western Australia. The works relate to the design and licensing of radiological waste management and upgrades to the submarine pier and electrical services to supply the nuclear-powered submarines when in port. The scope of works involves upgrades to the marine infrastructure, including dredging; upgrades to the power station and network; a new pure water plant; upgrades to communications, firefighting and other engineering services infrastructure; construction of a radiological controls technical field office; and construction of a controlled industrial facility. The estimated project cost is $738.1 million, excluding GST. Subject to parliamentary approval, the works are expected to commence in early 2025, for completion in early 2027. The works must be referred to, considered by and reported on to both houses of parliament by the Public Works Committee before work may commence. I commend the motion to the House.

Question agreed to.

Mr HILL (Bruce) (09:44): I just ask everyone to imagine walking into their favourite local coffee shop—for the member for Jagajaga here it might be in Heidelberg—grabbing a coffee and some breakfast and saying, 'Actually, I'll be back in 90 days to pay you.' Imagine going to your favourite local gift shop—I'd suggest Endeavour Hills Shopping Centre; there's an excellent gift shop there—buying a gift for your mum and saying, 'Actually, thanks for that, I'm going to take that now and I'll be back next March to pay you.' That is unthinkable and it's also wrong, just as it should be wrong for big business to long delay payments for small businesses.

Cash flow and payment times are absolutely critical for small businesses. It's simply unfair for big business to delay payments. Late payments are a major stress, and it's incredibly wasteful of the time of small-business owners and operators for them to have to spend time chasing and chasing the accounts departments of big businesses that just don't seem to care. Small business is critical to the Australian economy—more than $500 billion of economic value. More than 2.5 million individual small businesses are creating more than five million jobs and employing more than five million Australians in those jobs.

I would say, at the outset, something about one of the silliest things that we hear from those opposite. It is a very long list; I wouldn't say this is at the top. The Minister for Climate Change and Energy over there would probably talk about nuclear power and so on. That is pretty silly. But one of the silliest things we hear consistently is their schtick, their claim, their brand propaganda that somehow the Liberals are the party of small business. It's just nonsense. I say unequivocally, if you actually look at the at the record—not announcements, not the spin, but actually what the Labor Party has done in government and the difference between the last government and this government—Labor is the party of small business. Those opposite run this line that no-one over here on this side has ever worked in a small business and that no-one over here has ever run a small business. That's also simply not true. It doesn't matter; they just keep saying it because it is part of their brand propaganda and shtick.

I worked in a small business. It was my university job. It was tough. My mum actually chose not to go back to nursing. She tried, but, when my dad died, she just couldn't make the shiftwork balance with caring for my brother and I. So she worked for some decades in a small business doing accounts, stock control and sales. I ended up doing that as my university job and saw firsthand the stress of the cashflow impacts, the way that you have to balance payments and the impact when suppliers are simply not paying you on time.

Many government members—the employment minister, for instance—have operated their own small businesses, and many of our current ministers have husbands, wives or partners who operate small businesses—the Minister for Small Business, for instance.

To be very clear, when you strip it back, the core purpose of the Liberal Party has never changed. It's to protect those who already have the most accumulated wealth. That's the thing that sets them completely off. The other thing that sets them off, of course, is changes that are fair to workers. That's another speech.

But I'll stand on the government's record. This bill exemplifies that. The context is important. The budget, which complements that, will ease the pressure on 2.5 million Australian small businesses, providing more than $640 million in practical and targeted support. The payment time changes are important, but so is the government's initiative to invest $290 million, extending the $20,000 instant asset write-off, making it easier for small business to invest and grow. They like to claim that on the opposition side as one of their policies. They conveniently forget that it was the Rudd and Gillard government who put that measure in. Then the Liberals got elected and Tony Abbott scrapped it, until we embarrassed them into putting it back. But they like to pretend it was theirs.

The bill overhauls the payment times—

Mr Hastie: Deputy Speaker, on a point of order on relevance: as much as we're entertained by this journey through history and partisanship, can we get back to the bill?

Mr Bowen: Deputy Speaker, on the point of order, there's a very clear tradition of members being able to range broadly about how we got to a situation and why the matter before the House is important. I think that the member for Bruce is entirely within standing orders.

The DEPUTY SPEAKER ( Mr Buchholz ): I thank the members for their contributions. The debate before the House is the Payment Times Reporting Amendment Bill 2024. The member for Bruce did start off relevant. I'll be listening carefully.

Mr HILL: I think the point of order proved my point: they don't actually like it when you talk about their practical record on small business and why bills like this are necessary. We could all argue the point about the second reading amendment, which no doubt, as sure as night follows day, is pretty broad and would cover pretty much whatever you wanted to say. But I'll keep on.

The bill overhauls the Payment Times Reporting Act. It levels the playing field so large businesses have to treat small businesses fairly. It will increase the pressure on big business to pay on time, including name-and-shame provisions for slow-paying big businesses. You don't want to have to use them. The point is to create incentives, through the system, for big business to do the right thing and pay on time. To be fair, many big businesses do pay on time. They get this; they get that there SMEs, their suppliers, are important and that keeping them viable, keeping them afloat by doing the right thing and paying on time, does matter. But the bill will also do this but in a way which reduces red tape, streamlines reporting pressures and removes inefficiencies in the system.

The Payment Times Reporting Regulator is getting $33 million, as a complementary budget measure, to improve its ICT infrastructure. It's part of modern government, really. You can't just design measures like this without the policy going hand in glove with ICT improvements. As we saw repeatedly under the former government—was it $92 million they wasted on the failed visa privatisation through Liberal mate Scott Briggs, and, before that, their first crack at it, another $80 million or thereabouts on a failed ICT project?—it's important, like this measure shows, to get the ICT lined up with the policy changes. The reforms impact the same large business cohort—large businesses with over $100 million—required to report previously but do it in a way, as I said, that cuts red tape and makes it easier for big businesses to comply with their obligations.

There has been a legitimate question raised as to why the minister needs a power to give direction to slow payers of small businesses. Quite simply, the power will shine a light on large businesses that are persistently slow in paying their small-business suppliers. It creates the incentive, as I said, for large businesses to treat small businesses more fairly. Such a direction can also draw attention to the practices of slow-paying large businesses much earlier and with more prominence than just the reporting regime: 'If a large business pays slow, people will know.'

I'll leave my remarks there. I'm sorry to have upset the shadow minister in stating a few facts, but it is a fact that when the Liberals were last elected to government they cancelled the instant asset write-off test. I know it upsets them when you say it. They'll find another point of order. I don't want to upset you. I mean, you can get your steps up. You can jump up and down and take little points of order to stop the truth coming out, Shadow Minister, but it is a fact. Labor are proud of our record on small business. I'm proud of our budget initiatives and I'm proud of the fact that we've found a way, with this legislation and the complementary ICT investments, to get big businesses paying small businesses more quickly, making a real difference to cash flow and such.

Mr WALLACE (Fisher) (09:52): I rise to talk on the Payment Times Reporting Amendment Bill 2024. This is a bill which is near and dear to my heart. It's a bill that encompasses an area of law I practised in for 16 years.

Mr Hill: You should go back.

Mr WALLACE: I'll take that interjection. I would like to think I'd earn a lot more money if I did go back, but this is where I am.

To anybody who is listening to these proceedings, in particular on any building sites around the country: I'd like you to listen up. I'm a carpenter and joiner by trade. I then went back to school and did a law degree as a mature-age student. I was involved in small business for 35 years before I came into this place. What any small-business person knows is that cash flow is the lifeblood of any business. You can be the best carpenter, plumber or electrician—the best tradesperson—in the world, but if you don't have cash flow your business's days are numbered. Cash flow is king.

What we have seen for many years in this country, particularly in the construction sector, is a reluctance to pay on time. Subcontractors, in particular those in the construction sector, are often referred to as 'a builder's bank'. Those days must be numbered. We cannot allow or see a continuous situation where those down the contractual chain, those who are smallest in their business size, are effectively held to ransom.

Every state and territory in this country, particularly in the construction sector, has security-of-payment legislation. There are eight separate pieces of legislation which deal with security of payment in this country. There are not nine. There are six states, two territories and one Commonwealth. The one that's missing is the Commonwealth. There is no Commonwealth legislation which deals with security of payment. Security of payment is tied to payment times.

This bill will amend a scheme that was put in place by the former government back in 2021. This bill largely improves upon the original scheme that we introduced and put in place when we were in government. The original scheme provided for large companies to be held to account if they paid those down the contractual chain in a slow fashion. It's a name-and-shame type of approach, and that's a good thing. I think this bill can be improved in a number of respects, and I'll come to that, but I think it's really worthwhile to point out why this bill is needed to the extent that it is.

These figures are taken from ASIC. Company insolvencies in Australia for the financial year of 2022 were just a tick under 5,000. The figure was 4,912. In financial year 2023 they jumped to 7,942. That figure for corporate insolvencies went up by 3,000. In financial year 2024—and we ain't finished yet; we've still got the May and June reporting periods to go, so we're two months short—we've had 8,743 corporate insolvencies. We are seeing the greatest number of corporate insolvencies in many, many years.

You might ask yourself why this is the case. It is because of the cost-of-living crisis that this government is responsible for. We've now had five quarters of the most challenging economic circumstances since 1991. The growth for the last quarter was 0.1 per cent. It doesn't get much closer to zero growth than 0.1 per cent. Every day, when we come into this place, we hear the Treasurer crowing about how this government has been so good economically, but there are thousands and thousands of businesses out there in the real world that are doing it incredibly tough, not least of which are those in the construction sector.

We are seeing higher rates of construction company failures than ever before. The construction industry received the highest number of reports of insolvency, at 28 per cent, followed by the accommodation and food services industry, at 15 per cent, according to the Australian Institute of Company Directors. According to the Australian Institute of Company Directors, the most commonly reported causes of business failure were inadequate cash flow and high cash use. The member for Longman was a very successful businessman before he came to this place. He knows the importance of cash flow. He knows, as does the vast bulk of members on this side of the House who come from a small-business background, that cash flow is king.

The operation of this act is very important to recognise. The bill seeks to achieve seven outcomes. The first is to create a mechanism to permit the Minister for Small Business to direct an entity found to be in the slowest 20 per cent of payers overall or by industry to make enhanced disclosures to the regulator. The second is to permit the minister to direct a slow-paying entity to state in public-facing materials that it is a slow small-business payer. That's a good thing. If I am a small business and I'm looking to enter into a contract with a large company—this isn't expressly stated in the legislation, so here's a tip for those members opposite—wouldn't it be good to see on the front page of the contract a warning that the company that I'm about to enter into a contract with is a small-business slow payer? Wouldn't that be a good idea? If I was a small business and I had the opportunity or perhaps the luxury to enter into a contract with two or multiple sets of businesses and the contracts were on the table and I had one contract that said, 'This company is a lousy payer,' and another that didn't have that on the front page, which one do you reckon I'd go with?

The third is to allow the regulator to record in the register that an entity is a slow small-business payer. The fourth is to expand the functions of the regulator to include research, publishing and outreach with respect to payment outcomes. The fifth is to update the objects of the act to reflect the purpose of improving payment outcomes for small businesses and incentivising large businesses to make prompt payments. The sixth is to streamline reporting obligations and decrease the regulatory burden experienced by reporting entities. The seventh is to enable consolidated reporting in accordance with Australian accounting standards to improve the quality, completeness and comparability of data reported on the register. These are all fine things. They're good things. The most important thing, really, out of this bill will be the power to name and shame. It will be the ability or the requirement for a large business that, if it has been declared a slow payer by the regulator, it must put that on its public information documents. That could be a letterhead or their website, one would assume. But, as I said, it should also go on the contract, because that's the most important document when it comes to dealing with a small business.

On this side of the House, we are unashamedly pro small business. We don't like red tape. We do understand that this bill creates some red tape for businesses. We understand that. But life is a series of counterbalancing decisions, and, in this case, on this side of the fence, we regard that the importance of ensuring the cash flow of small businesses outweighs the regulatory burden that this would create on large businesses. For those of you who may be listening to this on the radio, a small business is one that has a turnover of less than $100 million. A big business is one that has a turnover of in excess of $100 million. For all those tradies who are out there on building sites, unless they're really making a motza, you're not going to be caught by this legislation. You can relax from a position of being caught by the obligations of this bill but you will receive the benefits when and if you enter into a contract with a large company.

The average payment time in this country for businesses is reportedly 37 days. I think that dreaming, from my own experience as a construction law barrister, particularly in the construction sector. It is not uncommon for small businesses to be strung out by 90-120 days. If you are a small business and you are paying your employees, you've bought your materials, you've paid for all of your business overheads, and yet you don't get paid for 90-120 days, is it any wonder that we are seeing such an increased number of insolvencies in this country right now? Unfortunately, this is fed by the cost-of-living crisis in this country. Small businesses are absolutely caught up by this cost-of-living crisis. Small businesses often have to mortgage their own homes. I bet the member for Longman did; I sure as hell did. We mortgaged our own homes to be able to ensure that we had enough money to pay our employees, and yet people are now paying three times the interest rates than what they were paying when we were in government. Three or four years ago people were paying around two per cent on their mortgage payments. It's now edging up at around 6½ per cent to seven per cent. If they have an overdraft, it's probably over 12 per cent.

The cost-of-living crisis that is being meted out by this government is the root cause of so much of the insolvencies that we are seeing. This is a sensible bill—it needs some amendments, and I look forward to those amendments being moved.

Dr GARLAND (Chisholm) (10:07): I'm really pleased to rise in support of the Payment Times Reporting Amendment Bill 2024. This is fulfilling a commitment that we took to Australians at the last election. This important piece of legislation delivers on our commitment to the nation. Our commitment was to deliver legislation to improve payment times to small businesses, with an emphasis on payments being made within 30 days or less. As part of delivering on this commitment, our government commissioned Dr Craig Emerson to undertake a review of the Payment Times Reporting Act 2020, which has helped to inform how this legislation has been written and will be implemented.

The review by Dr Craig Emerson found that, in its current form, the Payment Times Reporting Scheme is ineffective, so this bill overhauls the Payment Times Reporting Act 2020 to level the playing field and encourage large businesses to treat their small-business suppliers fairly. The treatment of small business by large business through this mechanism forms the essence of this legislation, and I think it's something that all fair-minded Australians would believe is the right thing for their government to do. We are acting on our commitment that we made during the election. We know small businesses are the backbone of the Australian economy, employing more than five million people and contributing more than $500 billion to the national economy.

In my own electorate of Chisholm we are home to 22,545 small businesses, employing tens of thousands of people in my community. These small businesses make an enormous contribution to the fabric of my community. One of my favourite parts of the job is getting to meet and know many small-business owners in the electorate. We recently launched our Chisholm 'shop local' initiative. I was so delighted to host our wonderful Minister for Small Business at a local small-business roundtable recently. I really want to thank everyone who participated in that event. My most recent Shop Local, Love Local campaign has been to encourage the Chisholm community to support local businesses in the lead-up to Mother's Day. My office created the Chisholm Mother's Day gift guide, featuring amazing local businesses, encouraging the community to both shop local and love local. At the end of last year, I was really pleased to see a local small business featured in the parliament gift shop, Tinta Crayons. There are still products available there, if people would like to see some of the fantastic work being undertaken in my electorate and being brought to our nation's capital.

The businesses that I feature in my gift guides and that I promote throughout my community and shop at as well are the ones that stand to benefit most from the legislation before the House. We know how important cash flow and payment times are to small businesses, particularly for small businesses who supply goods and services to larger companies. It's unfair for those larger corporations to delay paying small business invoices. Customers would never think of walking into our local bakeries, newsagents or coffee shops and trying to get away with 90-day payment terms. So this is an important step forward in bringing fairness into our business landscape. We know that late payments affect the cash flow of the business owed the outstanding debt, which forces many small businesses to find ways to finance that shortfall in their working capital and this restricts the ability of small business to use their cash flow to grow or invest in new products and services. We also know that a lack of cash flow is the leading cause of business insolvency.

Unfortunately, we also know that there has been a growing trend in payment practices, particularly amongst larger multinational businesses, to extend payment times to Australian small businesses. That growth in extended payment times is partly linked to the practices of multinational businesses applying global policies to improve their working capital efficiency. This effectively renders Australian businesses as the low-cost financiers of large and multinational corporations, and that should simply not be so.

It is a matter of fairness that this legislation addresses. It helps to level the playing field for small businesses right across Australia and for the more than 22,000 small businesses in my electorate of Chisholm. Our reforms will reduce regulatory burdens for reporting entities with obligations under the act, incentivise large businesses to improve their payment times and streamline processes and remove inefficiencies. Reforms will also improve outcomes for small businesses and incentivise large businesses to make prompt payment. That includes a shift to consolidated reporting in accordance with Australian accounting standards to improve the quality, completeness and comparability of reported data. Additionally, a mechanism for the Minister for Small Businesses to give a direction to an entity in the lowest 20 per cent of payers overall or industry to make enhanced disclosures is contained here as well. The minister can direct a slow-paying entity to state on its website and in procurement ESG related and other documents that it is a slow small-business payer as well as to inform the market on how to access its payment time reports. The payment times reporting regulator will then place a record in the payment times reporting register that the entity is a slow small-business payer.

These are important reforms and will function as both incentive and disincentive for large businesses as it relates to their small-business payment times. With faster payment times, improved cash flow and fewer administrative burdens, our reforms will make a real difference. We know that better payment times benefit everyone, which results in gains to productivity, supporting higher wages and profits and expanding employment opportunities.

These reforms are an important part of the Albanese Labor government's better deal for small business. We are delivering for small businesses, helping them to bounce back from challenges and improving their long-term resilience. Our budget is helping to ease the pressure on Australia's small businesses by providing more than $640 million in practical and targeted support. We're extending the $20,000 instant asset write-off, making it easier for small businesses to invest in their business. We'll provide additional targeted energy relief of $325 to around one million eligible small businesses through the Energy Bill Relief Fund. This builds on the up-to-$650 rebate that is being provided in this budget year.

Our government is also investing $18.3 million in two innovative programs—the cyber health check program and the Small Business Cyber Resilience Service—to help small businesses build their resilience to and bounce back from cyber attacks. This is in addition to the existing $23.4 million our government is committing to the Cyber Wardens program delivered by the Council of Small Business Organisations Australia. We've already delivered $18.6 million to help support small businesses adapt and build resilience through digital technology through the latest round of Digital Solutions, and we are continuing to strengthen this vital sector by investing an additional $10.8 million to extend access to free mental health and financial counselling support for small business owners. This additional funding builds on the $15.1 million we've already invested in these programs.

We've also updated the Commonwealth procurement rules, with small businesses getting a larger slice of the $75 billion in contracts that the Australian government spends every year. This will result in a 20 per cent target for small businesses when it comes to government procurement spend. Unfair contract terms are now illegal, thanks to our action, so small businesses can negotiate fairer agreements with large partners. We've also responded to Dr Michael Schaper's review of the Franchising Code of Conduct.

Our government is committed to supporting small business and investing in their future and the ambitions and aspirations of small business owners right around the country, because we know that small businesses are vital to the fabric of Australian society. We will always do what we can when we can in order to help small businesses and the communities they serve. I want to take this opportunity now to thank the small business community in my electorate of Chisholm. Our government does not underestimate the investment in resources, time and community that it takes to operate a small business, to recruit and train employees, to organise payroll and to build a future for those owners and their families. Indeed, I grew up in a household where my family ran a small business. I trust these reforms will make a meaningful difference to small businesses right across my electorate of Chisholm and across the country. I'll also take this opportunity to remind people to shop at and love their local small businesses. Thank you so much.

Mr McCORMACK (Riverina) (10:18): Small business plays a crucial role in the Australian economy. According to the Small business data report: 2023 year in review, approximately 42 per cent of private sector employment is in the small business sector. Small business adds one-third of gross value. It accounts for 97½ per cent of all businesses, roughly 2½ million, and it generates $500 billion of economic activity. That's a third of Australia's gross domestic product. They are big numbers. They are impressive figures. And we should, as the member for Chisholm has just stated, do everything we can to help small business. And I hear, hear, hear from the member for Moreton. He knows how important small business is in his Queensland community.

Last week, we heard—and we welcomed, indeed—the member for Chifley, the Minister for Industry and Science, saying that small businesses need some tax relief—some more tax relief, in fact. He said that the corporate tax rate should be lowered. He's not here this week. Maybe he's been sent for reprogramming by the Treasurer, who I'm not quite sure totally agreed with the member for Chifley's assessment of where the corporate tax rate is or should be, but no doubt the member for Chifley will consider the error of his ways when he goes against the member for Rankin. I say that very facetiously; I wouldn't want people to think I don't believe the corporate tax rate should be lowered, because when I was the small-business minister back in 2016 the small-business tax rate went down to its lowest level in 70 years. I was very proud of that.

As I just said—and the member for Chisholm agreed in her contribution—we should do everything we can to support, to promote and to enhance small business because it's small-business people who take the risk. It's small-business people who open the doors, who pay the rent, who pay the wages. Now they're having to pay even more wages after the announcement this week by the Fair Work Commission that wages are to go up by 3¾ per cent. No-one denies workers should be paid their dues, but it comes on the back of small business; they then have to find, in a cost-of-living crisis, more to pay their workers. What do they do? Do they put the price of their products up? Do they put the cost of their services up? Who ultimately pays for that? It's the consumer, the customer. Someone has to pay. Whether it's superannuation or wages, it's that small-business operator—that person who often pays their employees first, as they should; who puts away money for their superannuation, as they should; and who often gets paid less in small business than the person they employ to help run their shop. I pay tribute and credit to those small-business operators. They are risk-takers. In many cases—that is, farmers—they are price-takers, not price-makers, and they are certainly risk-takers because they operate on the smell of an oily rag. They operate on the whim of the weather gods. They operate on whether or not there are going to be good times in the economy.

We're talking about payment times reporting. Indeed, anything that can be done to ensure payment times are what they should be has got to be considered very much on its merit and very much supported by the coalition. But let's just consider the 4 June Daily Telegraph editorial, which was headed, 'Insolvencies are climbing and could send NSW broke'. Luke Achterstraat was the co-writer of this; he is the chief executive officer of the Council of Small Business Organisations Australia, so when he speaks we ought to listen. It was co-authored by Denita Wawn—someone very well known to me—the CEO of Master Builders Australia. And she and he, like the good member for Chifley, bell the cat. He calls for a lower corporate tax rate. They, in a very what could be called grim article, wrote about the shocking insolvency figures released just last week detailing the crisis facing small business in my home state of New South Wales:

ASIC's latest insolvency statistics provides the horrid figure of almost 4000 NSW businesses going bust in the year to date—

That's what they wrote; that was the second sentence in that very alarming article—

Business insolvencies in NSW are now up 61 per cent year on year.

In the same week the NSW government has set ambitious housing targets to be met, the sobering news is construction industry insolvencies are up 111 per cent from this time last year.

And we have a housing minister who talks about increasing the housing stock. I don't necessarily disagree with her, but, when you've got state governments shutting down gas, when you've got state governments like Victoria stopping the timber industry, I wonder how this is going to be met by the housing industry when they are trying to power homes, when they are trying to construct homes. What in goodness knows name will they be building houses out of if they can't use Australian timber? What we'll do is we'll import it. We'll just rape and pillage rainforests overseas to get the timber we need to build houses to accommodate the numbers of migration, which are just not sustainable. The numbers are just not sustainable. In fact, in January and February alone, we welcomed—and I do use the word 'welcomed'—more than 100,000 new citizens in each of those months, as part of the overseas migration intake. That number is equivalent to the yearly total of migrants during the Howard era. This comes on the back of a cost-of-living crisis. This comes on the back of a housing crisis.

Ms Rishworth: Plenty of people, though, are here temporarily.

Mr McCORMACK: Sure. I don't disagree with the minister at the table, but it still is a truism that we are importing record numbers of people, and they are staying mainly on the eastern seaboard, where 85 per cent of Australians live. They are not taking up the offers of employment or accommodation in regional Australia. Regional Australia—which carried this nation, by the way, during COVID—

Mr Hogan: All the time, not just COVID.

Mr McCORMACK: Indeed, but particularly during COVID. I take that, Member for Page—all the time.

Ms Rishworth: You're just having a conversation.

Mr McCORMACK: We have great conversations, let me tell you. Unlike the caucus of the Labor Party, we actually get along.

Indeed, regional Australia is carrying this nation, but never more so than during COVID. Small businesses in regional Australia are doing it tough. As this Daily Telegraph editorial by the two authors I mentioned earlier states:

We are clearly not doing enough to support those doing it tough. Legislating housing targets is one thing but ensuring builders can remain in business and deliver on these targets is another. Recent building approval figures for NSW show over the last 12 months less than 45,000 homes were approved, well below the 75,000 required each year.

That's just New South Wales. It doesn't take into account Queensland or Victoria, where there is so much pressure on the housing markets, as there is right across the nation. As Luke and Denita point out:

The ASIC figures also reveal very few industries were left untouched. Retail industry insolvencies are up 31 per cent year on year.

Thirty-one per cent, Deputy Speaker. They go on:

The stakes are extremely high, with 850,000 small businesses in NSW employing 1.7 million people and paying annual wages of almost $70bn.

But what did we get during the recent budget? Well, we got 36,000 more public servants. That's what we got. Someone's got to pay for those too. Taxes will pay for those—taxes paid by small businesses, taxes paid right across the board. The editorial says:

We seem to have forgotten that a future plan for Australia starts with empowering the entrepreneurs willing to risk their own capital.

We need to ensure red tape is reduced rather than increased to help small businesses survive.

That is so very true. They add:

Too many government measures are only adding to the fatigue of small business owners.

For instance, from 1 January all small cafes and restaurants will be required to label the origin of each seafood item on its menu.

While this might make business sense for luxury establishments, it means more cost and red tape for mum-and-dad fish-and-chip shops selling seafood baskets and marinara pizzas.

The NSW Small Business Commissioner has estimated costs of over $2800 for a small-business owner to physically alter printed menus.

It's just another bit of bureaucracy, just another bit of red tape, brought to you by a Labor government.

Mr Perrett: Supporting Australian aquaculture!

Mr McCORMACK: That'll be the day! This bill seeks to achieve several outcomes. It's going to create a mechanism to permit the Minister for Small Business to direct an entity found to be in the slowest 20 per cent of payers overall or by industry to make enhanced disclosures to the regulator. It is also going to name and shame. It's going to permit the minister to direct a slow-paying entity to state in public-facing materials that it is a slow small business payer, provide information on how to access its payment times reports and allow the regulator to record in the register that an entity is a slow small business payer.

There may be any number of reasons, good and bad, for a business to be tardy in paying its bills. Does it deserve to be named and shamed? According to the government, yes. The Payment Times Reporting Amendment Bill is going to expand the functions of the regulator to include research, publishing and outreach with respect to payment outcomes, update the objects of the act to reflect the purpose of improving payment outcomes for small businesses, incentivise large businesses to make prompt payments, streamline reporting obligations and decrease the regulatory burden experienced by reporting entities. It will also enable consolidated reporting in accordance with Australian accounting standards to improve the quality, completeness and comparability of data reported on the register, so it is going to be more onerous on small businesses.

Whilst the coalition supports the measures this bill contains, we need to remember that in everything we do in this place that there are people out there who are doing it really tough. There are small business operators who are finding it very difficult to keep opening their doors and to keep the lights on. That's not just because their power bills are going through the roof, but because of the red tape and bureaucracy that this Labor government seems to always want to foist on small businesses.

Not many of those opposite—a few, I will admit and agree—have actually run a small business. Many of them have actually run picket lines out the front of businesses, but not many of them have actually operated a small business. I have, I know, and it's tough. I know the member for Page has run a successful business. We come to this place with that knowledge, expertise and skin in the game. We've put own hard earned on the line to build a better local economy and to help our families—at the end of the day, that's first and foremost.

This government is doing so much to impede and hamper small business smoothness and efficiency. I will acknowledge the work being done by Bruce Billson, a former small business minister, heading up the Australian Small Business and Family Enterprise Ombudsman's Office. Small businesses should go to ASBFEO and have a look at what they have available on their website, because it is fast, it's knowledgeable and it will help a small business operate in these difficult times, in these trying circumstances. It will help them with tax and it will help them navigate their way through the various acts, and it is to be encouraged and admired.

I worry about small business. I worry about the fact that unions are dictating the terms to this government, as you would expect. There's always a payday when a Labor government is elected because they've got to pay back their union masters. They've got to pay back those who pull the strings. They are mere puppets of the trade union movement, and that only affects and impedes and slows small businesses across Australia, who need every bit of help from this disappointing government.

Ms SPENDER (Wentworth) (10:33): As the minister said in her second reading speech, small business is the backbone of our economy. They represent 97 per cent of all Australian businesses, around 40 per cent of private sector jobs and 30 per cent of GDP.

Small businesses deliver growth, innovation, productivity, employment and support for local communities. I'm very proud of the small businesses in Wentworth who are doing all these things. Some of those businesses, such as florists and cafes, you'll see as you walk down the street, but many of those small businesses will be businesses in the B2B sector. They're people that you don't see, but they are also critical parts of the supply chain. They are the beds of our innovation. There are so many businesses I've seen in Wentworth who may be small now but aspire to great things. So many of the Australian businesses that we have in the community today were small businesses once. It is that innovation, that talent and that drive that we, in this place, need to harness.

To come to the Payment Times Reporting Amendment Bill, this is a really important bill on the basis that there are important relationships between those small, medium and large businesses. According to the BCA, trade between small and large businesses represents around $700 billion a year. That is enormous. At the same time, in looking at that trade, we need to recognise the environment that our small businesses are operating in right now. It is a hard time to be a small business. Coming out of the COVID pandemic, when lockdowns were in place and demand slumped, businesses now face the enduring effects of inflation, supply chain bottlenecks, a struggling economy, high material costs and, still, difficulty in finding people to employ in their businesses. It is a really difficult time to be in business, and that's something that I hear constantly from the people I know in the business community.

On top of that, smaller businesses are facing a skewed business environment in the hands of large local multinational organisations that can exert power in different ways. That exertion of power actually stops smaller businesses growing and developing in the way that they would like to. I think this is an important area to address in the parliament. One area where this plays out is in payment times. As a former small-business owner, I know firsthand how difficult it is to manage the timing of cash flows, along with everything else. According to ASIC, inadequate cash flow is the most common cause for insolvencies in Australian businesses, and often, as a small business, this can be out of your hands. My mum often told me that when she started her business she learned very quickly and very early on that you have to get paid. That was a big part of what she used to do, as someone who supplied clothes to bigger businesses. As the owner of a new business starting out she was as obsessive about that as she was about the quality and fit of the clothes she made—because you have to get paid. If you don't get paid, you don't have a business.

The small business ombudsman found, in 2017, that large businesses were extending payment terms and delaying payments to better manage their own inventory and essentially using delayed payments as a form of cheap credit. This is undertaken often without consideration for the impact on small businesses dealing with their own cash flow issues. In 2020, the original form of this act established the Payment Times Reporting Scheme to address this issue. The scheme required regular payment time reports from eligible entities to be published on a register which could be accessed by small businesses. The idea was: greater transparency, faster payments.

A review of the original act published two years later, however, found that the register had no material decrease in payment times and found no evidence that small businesses were rejecting customers based on the reports published. That makes complete sense to me, because, if you're a small business, most of the time you don't get to pick and choose your customers. You're trying very hard to get and build your customer base, so, even if someone is a late payer, if you believe they're going to pay you you're going to stick with them. As of this week, the average payment time is still at 32 days, above the 30-day target period outlined in the legislation, with payment times in many instances extending well beyond this.

This bill strengthens the act from 2020 by implementing greater enforceability and compulsion powers for the regulator. Under this new law, the regulator will have expanded powers to gather information beyond just payment times from large businesses and to enact penalties for the slowest payers and those who fail to comply. The explanatory memorandum outlines that slow payers will be required to publish a statement on their website and other relevant documentation, including procurement documents, invoices and other commercial documents.

I recognise what this bill is trying to achieve but I have concerns that, for all its good intentions, it may not achieve the outcomes it seeks. That's because piecemeal solutions without the muscle behind them may not do anything substantial to affect small businesses and may instead just increase the volume of regulation in the economy. Despite the change in this bill, the legislation fails to address the fact that the 2020 review found that small businesses generally don't have the luxury of being choosy as to with whom they conduct business. Even if large companies have to publish their track record, small businesses are unlikely to turn down a major contract because of payment delay. Previous reviews tell us that.

The mechanisms of this bill are also somewhat dependent on the average. The explanatory memorandum states that the bottom 20 per cent of late payers will be subject to penalties, but currently not even the average payment falls within the target 30-day period. While it means that the most egregious offenders will be punished, there is little incentive for those businesses safely in the middle of the pack until the bottom quintile get their act together. My question to the minister is: is this the best that we can do to get rid of slow payments in our economy? For instance, would the government consider implementing a policy to not use slow payers in public contracts as an additional incentive to see if that's one way that we can actually drive better practices for small businesses?

In conclusion, the government is bringing this legislation forward to try to protect small businesses. I support the ethos and I support what the bill is actually trying to achieve. My big question is whether this will have the muscle to make the difference in the payment times for small businesses that I believe the minister would like to make and that I know small businesses critically need. One last issue I want to raise is that regulators that are established without powers or the means to make meaningful difference to the business community are worse than useless. I see this in the current ACCC, which only has a capacity to deal with 42 per cent of competition complaints, only 70 per cent of which are conducted within the target time of 12 months. So, if we have a regulator that can't actually deliver on the protections, then we don't actually have the protections in place, as much as we might feel that we are passing those protections as we stand here giving speeches in the House.

I will support this legislation because I believe this is a significant issue. However, I'm not convinced that it will significantly improve the lives of small businesses in the way that we would like it to. I hope I am proved wrong.

Mr VIOLI (Casey) (10:41): I want to commend the member for Wentworth for her contribution. I was listening intently, and the member is right: unless there's a tough cop on the beat, it's not going to make a difference. It was a wonderful contribution explaining the importance of cash payments. When the member was talking about her mum, I had a flashback to my former boss, good friend and mentor Andrew Blain, who owned Yarra Valley Snack Foods, where I was lucky enough to work for seven years. He spoke to me about the importance of cash flow and used to always say, 'Aaron, just remember: a sale isn't a sale until we get paid.' That's the reality for small business. They don't have millions of dollars in cash reserves. They don't have money sitting there to afford it. On a balance sheet of assets, profit and loss is important, but the lifeblood of a small business is cash flow and having more cash in the bank to be able to pay your employees, pay your suppliers and survive.

The reality that we need to acknowledge for many small-business owners and family businesses across Casey and across the country is that, when they don't have the cash, the people that go without are the owners. The owners always pay themselves last. When they don't have the money, they will pay their employees, they will work with their suppliers and, many times, they will go weeks without payment themselves. So we need to do everything we can in this House to make sure that we're supporting small business, that we're creating the conditions for them to succeed and that, when they do make a sale to a big business, they get paid. I want to take a moment to thank all the small businesses in Casey and across the country for everything that they do. You are the engine room of the economy, you drive innovation, you drive economic growth and you take risks, in many cases putting your family house on the line to chase your dream. Our role and our responsibility is to make your life as easy as possible.

Governments should not be picking winners. Governments shouldn't be backing multinationals and billionaires. They should be focused on creating the economic conditions so small business can thrive. In my community and in many communities across the country, it's the small businesses that give so much back. Anyone who visits a sporting ground in their community will see that. They will see it on the signs around the boundary. Every one of those sponsors is a small and family business giving back to their community. I've seen lots of IGA signs at sporting clubs across my community. I've never seen a Woolworths or a Coles sign at a sporting club in my community. That's why we need to back small business.

I spent 15 years working with and in small businesses, dealing with companies like Woolworths and Coles. Let's understand some of the behaviour of these big businesses—some of the behaviour that we need to stamp out. I hope this legislation will have an important role in doing that. As one example, Woolworths and Coles, in their negotiations with small businesses, will say to them, 'We'll pay you within 90 days, but if you give us an extra per cent out of your margin, we'll pay you within 60 days. If you give us another per cent, we'll pay you within 30 days, and if you give us another per cent, we'll pay you within 14. Give us five per cent and we'll pay you within a week.'

Let's be clear about this behaviour: this is Woolworths and Coles using their market share to bully small businesses—small family food manufacturers trying to survive—and prop up their profits and their margins at the expense of those businesses. That is some of the behaviour that we are talking about. That is some of the behaviour that we need to eliminate, because, if small businesses don't have cash flow, they won't survive.

This is the most challenging time businesses have had. I was speaking recently to a business leader in my community, a man who is not prone to hyperbole or exaggeration. His family business has been operating for three generations. He's been in the business for over 37 years and he said to me that this is the toughest economic environment that he has endured. It is a time when revenues are coming down because people are spending less, and we saw that in the national accounts. Their revenues are less but their expenses are going up. Every expense is going up for them: their rents, their mortgages, their energy bills, their insurance, the raw materials that they're getting from suppliers. Everything is going up and, unfortunately, we're seeing that when we walk through our communities and there are empty shopfronts. We're seeing it in the insolvency numbers. We're seeing it every day. We know it's challenging for small businesses, and we think: what is the government doing to support small business?

I will always stand in this House and speak on any legislation to support small business, but I was thinking this week that it had been a while since I'd had the opportunity to speak on legislation about small business in this tough economic environment, so I asked my team to reach out to the Parliamentary Library to do a little bit of research. I asked them a simple question: how many pieces of legislation directly related to small business has the Minister for Small Business introduced into this House in the last two years? I was waiting to get that answer, and it shocked and disappointed me when I got the response from the Parliamentary Library, because the fact is that this is the first piece of legislation that the Minister for Small Business has brought to this House in two years.

We are two years into the Albanese Labor government. We are in an environment where small businesses are struggling, and they are getting no support from the government. This week the Parliamentary Library gave me the data that this is the first piece of legislation that is directly related to small business that the Minister for Small Business has brought to this House. We are two years into the government, and it shocks me.

Ms Collins: You don't want to regulate them, do you?

Mr VIOLI: It's not always about regulation, Minister for Small Business. It's about supporting them. It's about providing opportunities to help small business grow. The interjection from the Minister for Small Business is: 'You don't want to regulate small business.' That shows how out of touch this government is. Talk about a government that doesn't understand small business! It tries to defend the fact that, in two years, it has brought in no support and no legislation for small business. This is coming from the Parliamentary Library. If you want to dispute the Parliamentary Library, feel free to. But this is the first piece of legislation that the minister has brought to this House. I believe she is on her feet next. She can contradict me and contradict the Parliamentary Library if she likes, but it's not about what you say; it's about what you do. For two years, the Albanese Labor government have abandoned small business. They have abandoned small and family businesses in my community and across the country, and those businesses know it. They tell us every day. The member for Page knows. They tell us that every day when we are talking to them. They feel abandoned. The facts show that they have been abandoned by this government.

This piece of legislation—let's be clear—was enacted in 2020. This was a piece of legislation enacted by the coalition government. It commenced on 1 January 2021. The review was called for by the minister in December of 2022. The minister then got the review in September of 2023. It took until December of 2023 to get a response. We are now in June of 2024 and we've finally got the legislation in this House. It then needs to be enacted. It then actually needs to operate. When you are a small business and your cash flow is under so much pressure, days, weeks and months matter. They make a difference. But, for two years, we have had no legislation from the minister. They have sat on this report for months and years. They're finally bringing it to the House. The first piece of legislation to support small business that the minister brings to the House is actually a coalition piece of legislation. I don't think anything else can sum it up more than that.

It's heartbreaking, because so many families are doing it tough. I was talking to a hospitality venue in my community. The husband and wife who own that venue are now working over 80 hours a week each just to keep the business afloat because they cannot afford to pay the wages of their employees. They are sacrificing time with their family. Their children are having to pull out of sporting organisations and organised sport for two reasons. They don't have the money to pay the fees and for the uniforms and they don't have the time to take their children to the events. They have sacrificed everything for this business. They are sacrificing everything today. They are working so hard. The sad part is that they have been abandoned by this government. That's the reality. That's one story. I could share many more. It is disappointing to see.

As I said, two years in, we've finally got a piece of legislation and it is a coalition piece of legislation that has been worked up. I think that sums up the Albanese Labor government and the disrespect and disregard they have for small business across Casey and across the country.

Ms COLLINS (Franklin—Minister for Housing, Minister for Homelessness and Minister for Small Business) (10:53): I would like to thank those who have contributed to the debate. I know how important small businesses are to the electorates that we represent. The Payment Times Reporting Amendment Bill 2024 is an important part of the Albanese government's commitment to delivering a better deal for small businesses. The bill implements important amendments to the Payment Times Reporting Act 2020 to level the playing field by promoting fair and timely payments from large businesses to their small-business suppliers. Our government recognises how crucial prompt payments are to small businesses and their cash flow. We are supporting small businesses to support broader economic growth.

The bill introduces a framework of transparency to name best- and worst-paying large businesses. This will create reputational pressure for large businesses, encouraging them to improve their payment times, terms and practices. It is important for the regulator to have appropriate powers to ensure big businesses are meeting their obligations under the act.

This bill broadens the regulator's functions to include undertaking research and publishing analysis on payment performance and practices on reporting entities. This research will identify the causes of slow payment practices and barriers to improvements and will provide the public with tools and data to understand and interpret the payment performance of large businesses. At the same time, this bill reduces regulatory burden for entities covered by the act, streamlining processes and removing inefficiencies from the act.

The reforms in this bill implement the government's response to Dr Emerson's review of the Payment Times Reporting Act 2020 and complement the other measures the Albanese Labor government is taking to support small businesses. Our budget is helping to ease the pressure on Australia's small businesses by providing more than $640 million in practical and targeted support. We're extending the $20,000 instant asset write-off to make it easier for small businesses to invest and grow their business. We will provide further targeted energy bill relief of $325 to around one million eligible small businesses through the energy bill relief fund, which builds on the up to $650 rebate that is being provided this financial year.

The government is investing over $60 million to help small businesses uplift their cybersecurity and digital capabilities. We're investing in free mental health and financial counselling support for small-business owners. We've updated the Commonwealth procurement rules, and small businesses are getting a bigger slice of the $75 billion in contracts the Australian government spends every year. We've made unfair contract terms illegal so small businesses can negotiate fairer agreements with large partners. We've responded to Dr Michael Schaper's review of the Franchising Code of Conduct, supporting changes to ensure a fairer franchising sector by requiring all agreements provide a reasonable opportunity for franchisees to make a return on their investment and provide greater access to low-cost legal advice if disputes occur.

This bill delivers on the government's commitment to improve payment times to small businesses. I am pleased that this important bill will receive support from the opposition and members of the crossbench. I trust members understand how important these reforms are, and I look forward to seeing this bill supported in the Senate. I commend the bill to the House.

Question agreed to.

Bill read a second time.

Ms COLLINS (Franklin—Minister for Housing, Minister for Homelessness and Minister for Small Business) (10:57): by leave—I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Mr LITTLEPROUD (Maranoa—Leader of the Nationals) (10:58): Let me make this very clear: the coalition will be opposing this bill. Let me also make this clear: a future coalition government will reinstate this industry. I want to make it very clear to every Western Australian that this coalition, when we are elected, will have the back. We will have faith and confidence in them and the reforms that they've put in place in leading the world in animal welfare standards. We won't cut and run. We won't leave the rest of the world to take up a market that doesn't live up to our animal welfare standards. That's not the Australian way. I make it very clear today that a future coalition government will reinstate the live export of sheep by sea to the Middle East.

I move:

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

"the House declines to give the bill a second reading and

(1) criticises the Government for imposing its reckless and ideological decision to shut down Australia's live sheep export industry by sea;

(2) recognises that:

a) Australia's live sheep export industry employs more than 3,000 people in Western Australia, including shearers, truck drivers, fodder suppliers, livestock agents, farmers and producers;

b) these workers now face the prospect of losing their job, and families that are struggling under financial stress may now face a difficult decision to leave their rural towns and communities;

c) this industry has delivered comprehensive reforms which have secured exemplary animal welfare outcomes; and

d) Australia has the highest standards of animal welfare in the world;

(3) further criticises the Government for the mismanagement and lack of consultation on this policy to end live sheep exports with farmers, sheep producers, and impacted communities;

(4) acknowledges that this policy is widely and strongly opposed across the agriculture sector;

(5) expresses concern that if the live sheep export industry is banned, alternatives will be sourced from countries that do not share Australia's animal welfare standards, resulting in perverse international animal welfare outcomes; and

(6) calls on the Government to immediately reverse its policy to shut down this industry".

We have been very clear on this and we're being very upfront. I was the Minister for Agriculture and Water Resources in 2018, when the Awassi incident came to light. We didn't have a knee-jerk reaction. We didn't shut the industry down overnight. We worked with the industry and we reformed it.

Mr Perrett: Like Pete McGauran did!

Mr LITTLEPROUD: In fact, as the member opposite interjects, that bill from the last time the Labor was in government and shut down the live cattle industry is going to cost the Australian taxpayer well in excess of $200 million because the Federal Court found that the Labor minister at the time, Bill Ludwig, made it without proper consideration.

When there was an incident with this industry, we worked with the industry. We didn't have a knee-jerk reaction. We didn't shut it down. We made sure that we reformed it, and we reformed it to a way that has led the world, that has set the standard internationally, that we should be proud of. We didn't put our head in the sand and we didn't turn away from this. We made sure that we could face up to the world in saying to them that this is the standard that now everyone must meet. By cutting and running, which isn't the Australian way—not while we're in government, anyway—you will have perverse animal welfare outcomes because that standard will be lost.

Let me tell you what I did to reform this industry when I was agriculture minister. It was about the stocking density rates on those boats. It was abut making sure that we had science and that we reformed the methodology of how we assessed the success of a shipment, whether it be cattle or sheep, to anywhere in the world. It was to make sure that was predicated on world-leading science that was created right here in Australia to make sure that the community had confidence and we set the standard internationally. That science was so intricate that we went from a mortality methodology, where the assessment of deaths on a boat of over 60,000 to 70,000 sheep had to be reported if there was one per cent mortality on that shipment, to now being down to half a per cent. Instead of going by the mortality, we overlaid that with the cause of that mortality: heat stress. That heat stress is what we made the reforms around. That was very scientific. It was done by eminent scientists and veterinarians that could give us confidence. It went to the very heart of the principle of the reforms that we put in place to make sure that these animal welfare standards would lead to us leading the world.

In fact, that sheep that trave on these boats now actually put on weight. As someone from western Queensland, let me tell you: animal husbandry is pretty simple. If animals are fed, watered, can walk around and can have a lie-down, they're pretty happy. When they're happy, they put on weight. It's a pretty simple philosophy and pretty simple in terms of what is happening to these sheep that we now have on our boats. We have made sure that each individual boat that comes to this country has its own individual score in terms of the air that flows through those boats. That's important in setting the stocking density rates to ensure that those sheep are happy and content and that there are good animal welfare outcomes. We score each individual boat by the way that it's built and by how much airflow it has. Then we look at each individual animal before it goes on that boat, and we measure to the millimetre the length of wool on each sheep—they're shorn before they go on—and they're allowed on. We also weigh them, and the weight of the sheep is very important as well because that goes into the stocking density rates you can put on these boats, in the pens. That's important because, if you have airflow and you have the weight and you have the length of the wool, that reduces heat stress.

But we went a step further. What I wanted to do when I was the minister and what our government wanted to do was have truth and proof. We wanted to prove to the Australian community we were leading the world in animal welfare standards in the shipment of sheep to the Middle East. I put in place independent observers that gave truth and proof about how the exporters were treating those animals on the export voyage. That was about making sure we had certainty and currency in what we were doing and what we were saying. They made sure that they built on that science of not just the airflow that was going through the boat, the stocking density predicated on the length of wool and the weight of those sheep; it was also about the pants per minute. We could work out whether sheep were heading into a heat stress situation by the number of pants they were taking per minute. This is a shipment of 50,000 or 60,000 sheep, and we were able to demonstrate that because of the reforms we put in place we would then have precautionary principles taken over by those exporters to ensure there was artificial airflow to reduce the humidity, to allow the airflow to go through and to reduce those pants per minute to ensure there was a good animal welfare outcome. That is something no other country in the world had ever done before, and that is what we did here in Australia.

Mr Wilkie: Other countries have banned it!

Mr LITTLEPROUD: That is what we did. We didn't cut and run, like the member for Clark wants us to do.

Mr Wilkie: Other countries have banned it! That's a good standard!

Mr LITTLEPROUD: He lives in Hobart, dripping with sanctimony and self-righteousness.

Mr Wilkie: The only good standard is to ban the trade!

Mr LITTLEPROUD: He has never been to regional Australia or on a boat. He wants to sit there, in condemnation—

The DEPUTY SPEAKER ( Mr Georganas ): The member for Maranoa will resume his seat. I ask the member for Clark to cease interjecting. You will have an opportunity to speak at a later time. The member for Maranoa has the call.

Mr LITTLEPROUD: I'm proud of the reforms we put in place. I don't live in an ideological world; I live in the practical world. I live in a world where this industry will continue whether or not we're there. The agriculture minister says this is a declining industry. His own department refutes that. In 2022 there were 380,000 sheep sent to the Middle East. In 2023 it was 654,000. I don't know whether you need a calculator but that's an increase, not a decline.

Let me tell you why there was a decrease in 2022 and probably even in 2021: there was this thing called a drought. Being from western Queensland, I can tell you that we destocked. A lesson for those from metropolitan areas: what happens when a drought hits is there is no food, water dries up and you sell your stock, but when the rain comes back you have to restock. Instead of sending sheep from Western Australia to the Middle East, we were sending sheep across the Nullarbor and they helped replenish the east coast and electorates like mine in western Queensland with over two million sheep we did not have and, in fact, would not have been able to procure. We would have had to try and produce, which takes time; I don't think I have to explain to the member for Clark in particular about how that happens and the time of gestation. That's about cashflow for farmers; that's about paying the bills. The practical reality is that this industry is in incline, and the only time it isn't is when it's a safeguard for the east coast. When we have challenges on the east coast it's an opportunity to draw on those stock from the west coast and to give us the ability to make money, to pay for taxes and to pay for you and me to sit here in this parliament and make changes.

This industry will continue. Let me tell you: this is not just about us. It is so arrogant for us to sit here and say to those countries in the Middle East, like Qatar and Kuwait and the UAE, 'You are not trusted with our live sheep because we don't believe you have the animal welfare standards.' This is not just about food security; this is cultural as well. This is about respecting their cultural beliefs and giving them the food security they need. This industry will continue whether we're there or not. If we're not there, the countries that will take this market up will be countries like Ethiopia, Sudan and South Africa. I talk about the science of stocking density rates on boats. But they don't work on animal welfare. They work on a mortality methodology—the one that we came from. But they don't work on any stocking density rates at all. Their methodology is to put as many sheep as they possibly can on a boat, and what they get paid for is what is left at the other end. That is horrific.

This is about us having a moral compass, not being morally bankrupt and ideological from the sanctity of Hobart but actually having the—

The DEPUTY SPEAKER: Order! The member for Maranoa will resume his seat. The member for Clark, on a point of order?

Mr Wilkie: On a point of order, Deputy Speaker: the member is reflecting on my character. I ask him to withdraw those comments.

The DEPUTY SPEAKER: The member for Clark will resume his seat.

The DEPUTY SPEAKER: The member for Clark has made his point and will resume his chair. I ask the member for Maranoa, for the sake of the House, to remove—

Mr LITTLEPROUD: I sorry he's so upset, but it's a few home truths that need—

The DEPUTY SPEAKER: I asked the member for Maranoa to withdraw.

Mr LITTLEPROUD: I withdraw, Mr Speaker. Sorry; I didn't hear that.

It is important to understand that, when we remove ourselves, when we cut and run—the Labor way—from this industry, those countries will take it up, and what you will see is the senseless and horrific death of millions of sheep from heat stress. They will die a horrific death. Much of the vision that those opposite were opposed to and made them want to shut this industry down without reforming it—what they will see is that transposed onto ships coming from those countries. Where is the moral compass with that? That's not the Australian way. We stay and get it right and we lead the world.

But it gets worse, because, by not sending these boats anymore, we also lose our influence in the processing of the sheep in the Middle East. I actually had the courage, unlike the current minister, to go to the Middle East, after the Awassi Express, and explain to them and give them confidence that we would continue to send live sheep but there would be conditions and there would be reforms about animal welfare, many of which they had already adopted, not only in terms of shipment but in terms of the processing. They were prepared to do it.

So important is it to them and their food security and their cultural beliefs that they are prepared to spend tens of millions of dollars on new abattoirs. The one that I visited in Kuwait City was brand new, the size of a rugby league field, complete with a viewing area for 2,000 people and a playpen in the corner for the kids. What happens is that you come in, you go out to the yards, you put your tag around the sheep that you want, you wait for the number to come up, you go up to the glass and you watch the sheep being processed and you see that it is processed in the way in which their culture expects it to be. That's respect. That's respect that we've given these countries around their cultural beliefs and their food security. That's the investment that they've made and the importance that they place on it. So that Australia is actually able to send them these sheep, to give them that food security, they live up to the standards that we are asking them to process those sheep in. Now that will be lost.

The animal activists jump up and say that there is leakage out of the supply chains and that you see people take sheep out of the pens and put them in the boot of a car and take them home and slaughter them at home. Well, that's going to become the norm. That's what happens when Australia cuts and runs. That the animal welfare standard that this government is going to sign sheep from around the world up to. How do you value the welfare and the life of one sheep above the welfare and the life of one from another country? If you are morally invested in this as much as those opposite say they are, then how can you do that? How can you morally sit there and value the welfare of an animal from one country over the welfare of an animal from another? I can't. I'm going to stay and get this right. That's why we'll reinstate this industry.

There is this folly about: 'We'll be able to process them all in Western Australia.' Let me give another little agriculture lesson for those opposite. There are some practicalities around this, around agricultural production and understanding the seasonality in terms of supply. If you want to build an abattoir in this country, it's going to cost you the best part of $50 million, probably a bit more. To get a return on an abattoir, you actually have to have it running 365 days a year. That takes a lot of money. It takes a lot of costs in energy, particularly when you've got an energy policy like this mob have. But you've also got to have the staff. In Western Australia, because it's a seasonal industry, these sheep come off and are sent to the Middle East in a seasonal pattern that goes with their production cycles in Western Australia. You can't keep an abattoir going for 365 days a year. No-one is going to take a punt on $50 million to build an abattoir that can only run for nine months of the year.

Mr Wilkie: That's the point. We're going to change the nature of the industry so it's more consistent.

Mr LITTLEPROUD: I don't know where the member for Clark, who wants to continually interject about this, gets his economics, but, if he goes and has a look at an abattoir and talks to someone who owns one, they'll tell him very quickly that no-one's going to make that sort of investment unless they can keep it running 365 days a year, not six to nine months of the year. How do you find the workforce for six to nine months and shoot them off again? It doesn't pass the commonsense test. What this government is doing is playing on the ignorance of people in capital cities who don't understand the production cycles and systems and don't understand the world.

Mr Wilkie: But they understand animal welfare.

The DEPUTY SPEAKER ( Mr Georganas ): Order! The member for Maranoa will resume his seat. I've asked the member for Clark to cease interjecting. I like the member for Clark, and I'm not going to take further action and I don't want to. So please cease interjecting. You will have an opportunity later to speak in this place.

Mr LITTLEPROUD: This is the folly that is being sold to Australians—that we can just process them all here—without understanding these decisions. This is what happens when you have a government that doesn't understand agriculture and doesn't understand production cycles. If you were serious about the ideological view you'd taken and you had conviction in what you believed, wouldn't you go and face these people in Western Australia—the 3,000 livelihoods that you're about to rip away? The Prime Minister on election night said that no-one would be held back and no-one would be left behind. That's unless you live in Western Australia. That's unless you're in agriculture. Why wouldn't you go and look them in the eye and say: 'Look, this is the reason why we are shutting down. This is the scientific reason why we are shutting this industry down. This is the economic reason why we are shutting this industry down.' But they have no courage to go and face any farmer or anyone in the industry.

In fact, when the minister went to announce that the phase-out date was May 2028, he flew on taxpayer dollars to Perth to make an announcement at the Commonwealth parliamentary offices by invitation only and Zoomed in every stakeholder in the industry. He didn't eyeball them. He hid in a parliamentary office so that he could do his press conference with Perth in his background. How shallow can a minister be that he doesn't have the courage of his convictions to front up to these people and make an announcement? Go and make the announcement at Katanning. Go to the yards in Katanning and tell them. If you are so convinced about why you are doing this, if you are so righteous, then go and face them. Look them in the eye. That's the Australian way. It's not to just cut and run. If you're going to cut someone's livelihood, have the courage to look them in the eye and tell them exactly what you're going to do and why you're doing it. Instead, this is all ideological.

As soon as that announcement came out, so too did the press releases. The Animal Justice Party takes credit because this is now the reward for the preference deal that they did with Labor in the 2022 election. They did it to get their preferences. It all came out. But we knew that from the start because the animal activists were the ones who announced the closing down of this industry to start with. That's who's running this government. It's not someone who makes decisions predicated on experience or knowledge or industry insight or consultation. That's why you see over a thousand registered trucks and tractors driving through the streets of Perth. They've had a gutful of not being listened to.

Not only that but this government is so incompetent. The minister sent his department to tell Kuwait and Qatar that they were going to phase this out. But how incompetent were they? They sent them to the wrong agency. They told the wrong government department that they will no longer have food security because Australia doesn't trust them anymore. They sent them to the wrong department, causing an international incident with a good, significant trading partner from the Middle East. This shows how invested this government has been in its pursuit of shutting down a lawful industry.

I get the passion from some, particularly those from capital cities that don't understand and don't appreciate exactly what happens, but you are talking about the livelihoods of 3,000 Australians, taken away with the stroke of a pen, without a reason, without science, without economics and without acknowledging the reforms that were put in place to protect this industry that this country led and leads the world on. Why would you not have the courage of your conviction to front up and face them and tell them to their face exactly why? Australian governments should be better than that, no matter their political persuasion. They should have the courage to face up and they should have the courage to say to their fellow Australians, 'I'm going to take your livelihood away and this is why.' If you don't then you don't have a social licence to operate, as far as I'm concerned. The people of Western Australia and these producers are, rightfully, wondering where their government is going.

There is a better way, and we have shown it as a nation, and that's why this industry needs to continue. That's why we still want to see meat processing in this country. We've got to understand the limitations of it in terms of production cycles. It's great for economists and those in capital cities telling us how to operate and how to produce the food and fibre that they enjoy every day, but at some point they might want to have an understanding of the economics of it and how it actually operates. Otherwise, you're going to have a perverse outcome. This is the challenge that we have, and you will see these countries taken up.

When I asked the Prime Minister in question time in the last sitting to name one country in the world that has higher animal welfare standards in the export of live animals—anywhere in the world—he could not name one country—zip—because there aren't any. This is the moral dilemma of those opposite who want to take this away. If they're really honest with themselves, when they go and put their heads on their pillows tonight and shut their eyes, they should really ask themselves: 'Have I really saved any sheep? Really? Am I going to save the welfare of any sheep because of these actions?' They won't. The ideology will tell them that; the practicality won't. The practicality of this is that they will have the deaths of millions of sheep—horrific deaths of heat stress, of conditions that we would never support, that no farmer ever supports.

What we did is we led, we reformed and we changed it. We did that with the cattle industry as well. There was an error in 2011—and I mentioned earlier that this government made a knee-jerk reaction and shut it down, which is going to cost about $200 million to $400 million in compensation. But they were given a chance—they reformed it and they reformed the processing sector in Indonesia so that our animal welfare standards were respected in Indonesia. The Indonesians had the respect to lead as well, and to make sure that the animal welfare standards that we expect are delivered there. That's what it is to be part of a global community and to do the right thing, not to cut and run, not to have some ideological view because a minority in this country is asking you for it and because you want their preferences. It's about doing the right thing. It's about leading the world. In regional Australia we have led the world, and we're going to be let down by politicians dripping with self-righteous sanctimony who have zero understanding of this industry. They've never engaged with this industry. They've never engaged with production cycles in any agricultural form, yet they are prepared to sit here and make decisions on these people's livelihoods and futures with the stroke of a pen, without even saying a word to them. That is not the Australia that I know. That is not what regional Australians expect should happen in their parliament. That's not what they expect from their elected members of parliament.

For this minister, who voted against a motion we put up last week to have a parliamentary inquiry into this, because he failed to go and talk to them, we thought we might get the parliament, and then within a matter of days, he then reverses it and says, 'Yes, there's still a parliamentary inquiry, but let's do it over the next two to three weeks.' That is absolute contempt for those men and women whose livelihoods he has taken away with the stroke of a pen. He's not shutting this industry down till 2028, so wouldn't you think he could give them some respect? Wouldn't you think that he could show the respect to turn up and have a parliamentary inquiry, test his science and test his economics in front of this industry—in front of the men and women whose livelihood he's going to take away. Let's have a debate of ideas on this. Instead, he's shown absolute contempt that they must have their submissions in within less than a week.

That's absolute contempt for understanding what farmers and industry are going through. They're not sitting there with bated breath waiting for the minister to ask for a submission. These men and women are out producing your food and fibre. To say that there's limited spaces and limited time for you to go and put your case to your elected officials, to disrespect them and disrespect democracy in the way that this government is proposing to do speaks volumes about them, not the farmers whose livelihoods are being taken away.

I challenge the minister to follow through with what he also committed to in Senate estimates, that there would be a Senate inquiry into this, because I suspect this is all about the politics of the cities. 'Oh, no, we gave the good old people from the bush a bit of a look in. We gave them a parliamentary inquiry and they had a whinge, but we were right after it.'

Mr Ramsey: 'We had the numbers on the committee.'

Mr LITTLEPROUD: Yeah, don't worry about it. It's in the Senate where this thing could stop. The minister needs to show the courage of his convictions if he believes so passionately in the science—that he cannot seem to give.

Even on the weekend on Insiders, when he was asked, 'Why are you shutting this down?' His reply was, 'The industry hasn't done enough.' Tell us what is enough then? Tell us what would be enough to meet the high standards that this minister believes in because he'll have to also tell us what the science is. I challenge the minister to live up to his word and have that Senate inquiry, because there are crossbench senators there that can stop this madness.

I can assure you that a future coalition government will stop this madness. We will give certainty to Western Australian producers, and we'll also give it to cattle and sheep producers around the country because cattle producers are caught up in this, and not just in Western Australia. They can see the contagion that's coming because the animal activists are running this show, and this ban will go from sheep to cattle. It is coming to an industry in a state near you. This is the ideology that's being run by this government. Just understand what it cost you and what it cost us in our reputation with Indonesia the last time we shut down the live export industry to Indonesia.

There is a way to do this. It's about respect and it's about understanding the food security and the cultural needs of these countries, and making sure we're there to do it. That's the Australian way. While I respect the ideology of many of these people from the city that come in and condemn this industry without knowing anything about it, what I don't respect is that you don't have an understanding of what happens out in regional Australia, what happens on these farms, what happens on these boats and what happens in these processing centres.

We're proud of what we've done. We're proud of the reforms that we put in place. This industry deserves another go. It's proven itself to not just Australians but to the world.

I don't want to be part of a parliament that doesn't have the courage not only to look people in the eye when they're going to shut their industry down, but to stand up and to lead the world. That's the Australian way. That's the country that I was born into and am proud to be part of. That's the one that I'm going to stand here and fight for. And I'll ensure that any future coalition government makes sure that they live by those principles in the future, as well, because there's too much to be lost.

The DEPUTY SPEAKER ( Dr Freelander ): Is the amendment seconded?

Mr Sukkar: I second the amendment and reserve my right to speak.

Debate adjourned.

Dr HAINES (Indi) (11:30): I rise to speak on the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024. I want to specifically address the measures in this bill which will introduce mandatory climate reporting requirements for large businesses regarding climate-related governance, strategy, risk management and emissions targets, including for greenhouse gases. This will include reporting emissions from supply chains, so farmers in regional elections like mine will be impacted by this bill. Businesses who must comply would meet two out of three thresholds: one, that they have over 100 employees; two, that the value of their consolidated gross assets is $25 million or more each financial year; and, finally, that the business's consolidated revenue for that financial year is $50 million or more.

I welcome measures that Australia's major companies must now be transparent with and can be held accountable by investors and consumers when it comes to climate change. We must measure how businesses are progressing as they transition to net zero emissions. We're now living in a world impacted severely by climate change. This is accepted internationally. Indeed, this bill makes sure we are in step with international requirements for a credible climate disclosure regime.

Even though these measures are necessary, which is why I will ultimately support the bill, I want the House to hear and I want to acknowledge that they will be challenging for some sectors. In particular, the measures will be challenging for the agricultural and primary production sectors. Although some farming businesses won't meet the thresholds for mandatory climate risk reporting, it's important to acknowledge that they are part of the supply chain for larger businesses that will. Emissions from the supply chain are known as scope 3 emissions, and scope 3 emissions reporting will require farmers to report on the emissions from production, including diesel and farm machinery in transport, fertiliser and even methane emissions from cattle. This bill is setting out what is going to happen with or without legislation.

Farmers are increasingly required to provide the emission profiles for insurance and banking and to identify opportunities for emissions reductions on their own farms. This may be the case, but I do hear farmers' concerns about meeting emissions reporting requirements. Many farms struggle to calculate and disclose their farm emissions. It's a relatively new part of farming practice. It can be costly, confusing and time-consuming. Many farmers I speak to across my electorate of Indi also tell me that they want to do their fair share in reducing our national emissions but they must be mindful about the expense to their livelihoods. They talk to me about the challenge in balancing these factors.

To get the balance right, it's critical that governments provide the resources and support to get farmers up to speed on emissions reporting and don't leave farmers carrying the cost of compliance. Hearing farmers' concerns about emissions accounting and reductions is why, in the 2022 election and last year, I advocated for federally funded agricultural extension officers. Extension officers would work with farmers one-on-one to adopt the technology, products and farming practices that would help them calculate and then lower their emissions to achieve net zero. These extension officers would translate the science into practice, delivering the research on how to accurately measure soil carbon or what nutritional additives could be used to reduce methane emissions in livestock, for example. The advice must be from local, trusted, neutral, independent officers who know the specific environment that the particular farmer is working in, because the techniques applied in low-rainfall, poorer soils will be different from those in high-rainfall, organically rich soils.

Government funded extension programs have been used historically to help farmers navigate changing times and changing technology. Extension programs have fallen by the wayside in recent times, but I was pleased to see, in last year's budget, the take-up of my idea and the funding of a network of sustainable agriculture facilitators. These facilitators will provide extension services to farmers to build their knowledge of climate-smart practices. This directly replicates my policy, which, I heard from farmers in my electorate, would indeed help bridge this significant knowledge gap. I understand that the design of the sustainable agricultural facilitators is in the final stages and will be delivered by regional development partners, including natural resource management organisations. I very much look forward to learning more as these agriculture facilitators are rolled out, including in my electorate of Indi.

Sustainable agriculture facilitators sit within the broader $302 million Climate-Smart Agriculture Program. This program is all about driving agricultural sustainability, productivity and competitiveness by reducing emissions, building resilience to climate change and conserving national capital and biodiversity. Under the latest budget, I was pleased to see an additional $63 million to support the reduction in emissions in agriculture, including $28.7 million to improve greenhouse gas accounting. The National Farmers Federation welcomed this announcement, saying it aligns with what the farming sector has been calling for, giving them much-needed independent advice to make informed decisions about their businesses. More money to help farmers calculate and reduce their emissions is a timely announcement when considering the bill before us right now. It's common sense that the government supports farmers in this way if it is also requiring them to report on climate risk issues like the scope 3 emissions I've just outlined.

I support the bill, and I will watch the government closely to ensure that they continue delivering the support farmers need to calculate and reduce their emissions. This, in turn, produces sustainable, productive and profitable food and fibre needed to feed and clothe our nation and to remain competitive in international markets.

Ms SPENDER (Wentworth) (11:37): I rise in support of the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024. I will focus my comments on schedule 4, which provides for the introduction of mandatory climate related financial disclosures, a positive and long-overdue reform.

I have spoken many times in this place about the risks posed by climate change, and these are getting greater every day. A few weeks ago, the Guardian revealed that hundreds of the world's leading climate scientists expect global temperatures to rise by at least 2.5 degrees, 'blasting past internationally agreed targets and causing catastrophic consequences for humanity'. Climate change poses huge risks to our society, and there are specific risks for our business community and the financial sector. This includes both the physical risk of a warming planet, like increased fires and floods, and the transition risks associated with moving to a net zero world.

Internationally, one of the tools being used to manage these risks is mandatory climate related financial disclosures. These disclosures are a key enabler of corporate climate action because they help companies identify and manage the genuine risks that climate change poses to their businesses, because they provide the transparency that helps shareholders and the public invest in the net zero economy, and because they hold companies accountable for setting and meeting their climate goals. This work has been led globally through the Task Force on Climate-related Financial Disclosures and, subsequently, the International Sustainability Standards Board—global progress to tackle a global problem.

Mandatory standards are now in place in economies worldwide. The UK introduced a mandatory climate related financial disclosures requirement in 2022. The European Union has a directive in place covering both large European firms and more than 10,000 non-European companies. In March this year, the US introduced its own long-awaited disclosure requirements. Once all pending disclosure rules are enforced, it is estimated they will cover nearly 40 per cent of the world's economy, also including Brazil, Canada, Hong Kong, New Zealand and Singapore, so it is absolutely time that Australia acts.

Whilst many large corporations listed on the ASX are already preparing sustainability and climate change reports, these disclosures are not consistent, not mandatory and not adapted for the Australian context. If we want a future to be made in Australia, if we want to attract the kind of capital that is critical to becoming a green energy superpower, if we want to meet even our modest climate targets, then investors need transparent and consistent information, and this is what this bill seeks to provide. It requires entities to make an annual climate statement which identifies the climate risks and opportunities they face, outlines their plan for managing these and sets out their climate related metrics and targets, including entities' scope 1, 2 and 3 greenhouse gas emissions.

The bill takes a phased approach to introducing these standards, with the very first reporting period starting on 1 January 2025 for 729 very large companies categorised under the legislation as group 1 entities, which are broadly comparable in size to those listed on the ASX. There are further grace periods for the so-called group 2 and group 3 entities, with medium-sized entities in group 3 not required to provide full disclosures if they can show they have no material exposure to climate change. This phased approach is appropriate, particularly when it comes to the group 3 entities, the smallest companies captured by this regime. I urge the government to take the lead from countries like Singapore, where significant support has been provided to help comply with the new reporting regime.

This bill is particularly relevant for my community in Wentworth. Over the past two years, I've spoken to many constituents, from those in the banking sector to venture capital investors to clean energy companies, who recognise the importance of this kind of transparency and disclosure being provided for in this legislation. I want to commend the government on the broad support for this legislation which exists across the financial, business and non-government sector. When this bill was introduced, 15 of Australia's most influential organisations representing business, finance, and investors came together to support the passage of schedule 4, including the Business Council of Australia, the Australian Institute of Company Directors, the Property Council, the Investor Group on Climate Change and the Australian Sustainable Finance Institute. Together, the group represents more than 900 companies, investors with over $80 trillion worth of assets under management and 7.7 million retail shareholders. It is great that they're backing the bill, as are those across the climate and environmental community.

But, whilst this is a good bill, I do have some concerns about the unintended consequences of certain provisions in the legislation, specifically the modified liability provisions. Under the legislation, entities must report on matters including their scope 3 emissions, scenario analysis on the impact of climate change on their business, and, critically, their transition plans—that is, the set of steps they are taking to transition their business to a net zero world. These are incredibly important disclosures. They may be challenging to put together in the first instance, but they go to the heart of the kind of transparency and accountability that this bill seeks to mandate.

However, the government has inserted modified liability provisions into this bill, which means that no legal action can be brought against entities in relation to these disclosures for the first three years of the new regime. ASIC will still be able to bring actions against businesses for claims that are misleading or deceptive, but the right of third parties, including investors, to do this has been removed. The weakening of this legal check and balance may undermine some of the policy intent of the new regime. As currently drafted, the bill may prevent action such as the 2021 case against Santos for misleading and deceptive conduct, which was brought when Santos claimed they had a credible pathway to net zero by 2040, despite plans to open up new major gas projects. This bill should enable companies to be more accountable for their climate transition plans, not less.

I understand there are practical difficulties for businesses having to meet new reporting requirements. It's not easy to get things right the first time, and there are inherent challenges with calculating scope 3 emissions, choosing the right scenarios to analyse climate impacts and plotting your company's path towards net zero. Large ASX listed companies, such as the group 1 entities captured by this bill, have the resources to comply with these new reporting requirements, and many have been making similar disclosures for some time. I'm not sure if they need three years to get it right.

I have much more sympathy for medium-sized businesses like the group 3 entities covered by this bill. As a former small-business person, running a small business myself, I don't underestimate the challenge of meeting new reporting requirements. When you're cash-strapped and short-staffed it won't always be easy to get your sustainability disclosures right the first time.

When it comes to the modified liability provisions in this bill, it's a mixed bag. I think it's appropriate that companies, particularly those in group 3, have some protection in the early years. I think it appropriate that these projections go to scope 3 emissions and scenario analysis in particular. And I think there is a role for these projections in helping companies make the most ambitious disclosures possible, rather than focusing very narrowly on regulatory compliance and needing to pull back on their disclosed decarbonisation plans for fear of litigation. I note the strong community support from the business community for modified liability provisions. I also note the bar for litigation for misleading disclosures in comparable regimes such as the UK is far higher than that provided for in this legislation. I'm also concerned that the provisions may make it easier for large fossil fuel companies like Santos and Woodside to greenwash for the next three years and to claim that they're committed to net zero whilst investing in new fossil fuel projects. I'm hesitant about removing these protections entirely, so I urge the government to look at whether they have achieved the right balance between these two competing priorities as this bill moves forward.

This is an important piece of legislation, and I commend the Treasurer and his colleagues for the broad support it has received. In closing I also urge the coalition to reflect on the support this bill has from the financial and business sectors and to support the provisions in schedule 4. If you're serious about taking action on climate change and seizing the opportunities of the green transition, you need to support legislation like this.

Mr TAYLOR (Hume) (11:46): I move the amendment circulated in my name:

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

"the House declines to give the bill a second reading, and notes:

(1) Australia is in an entrenched GDP per capita recession and almost 17,000 businesses have gone insolvent since the government came to power;

(2) Treasury analysis confirms this Bill imposes $2.3 billion in compliance costs in its first year of operation, with no productivity benefit;

(3) ASIC and the Australian Small and Family Business Enterprise Ombudsman have confirmed to Senate Estimates that this compliance cost will be passed on to small businesses;

(4) the United States, Canada, Japan, and most of Australia's trading partners do not require the reporting of scope 3 emissions. The Productivity Commission has confirmed to Senate estimates that this sort of misalignment in regulation will harm investment and make Australian business less competitive; and

(5) while the Coalition is not opposed to reasonable disclosure regimes, this legislation is a red tape bomb that will hurt Australian farmers, small businesses, and ultimately raise prices."

This is not about being pro- or anti-climate. It's not about being pro-emissions reduction or otherwise. This bill, the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024, unhappily, is about being pro- or anti-small business. This is an anti-small-business bill. The bill puts an unacceptable compliance burden on the Australian economy at a time when the government is claiming it will reduce their compliance burden. It puts compliance obligations on Australian companies that are completely out of line with our international peers—with the US, with the UK and with Canada. Sadly, the bill creates the risk that small businesses will only be able to contract with, bank with or sell to larger businesses. It accelerates the trend of debanking we are seeing amongst our farmers, miners and resources industry more generally.

If we are to get this economy back on track we have to get back to basics, and right at the heart of that is getting red tape, getting regulation, getting compliance burdens—which is what this will be, of $3.2 billion, and I think that's a conservative estimate—out of the way. We have to allow small-business people to get on and do what they do—invest, create jobs, take risks and create opportunities for themselves and all their stakeholders like their customers, their suppliers and their employees. You can't do that when you're wrapped in red and green tape, which is exactly what this is about.

Schedules 1, 2 and 3 of the bill implement recommendations of the financial market infrastructure regulatory reforms to strengthen the financial market infrastructure. We support these changes but we have grave concerns about the proposal to remove parliamentary scrutiny of changes to voting power on the ASX. Currently, changes in voting power to the ASX are limited to 15 per cent and any change requires regulations to be altered and subject to disallowance. This amendment instead confers this power to ASIC, with ministerial approval—so the power of disallowance is removed, and we have concerns about that.

Turning to the mandatory climate disclosures, schedule 4 of the bill generally requires that entities that lodge financial reports under chapter 2M of the Corporations Act meet certain minimum size thresholds or have emissions reporting obligations under the NGER Scheme to make disclosures relating to climate in accordance with relevant sustainability standards made by the AASB. Schedule 4 implements a climate reporting regime that is stricter, more onerous and more widely applied than that of any of our trading partners. ASIC chair Joe Longo has described the changes as the biggest change to corporate reporting in a decade. At maturity, the scheme will require all companies with turnovers above $50 million to disclose audited and assured scope 3 disclosure statements. ASIC will have full enforcement powers from commencement, but there will be a safe harbour from private litigation for just three years.

I made the point that this is about disclosure of emissions—not just scope 1 and scope 2, which is what you typically see around the world, but scope 3. What are scope 3 emissions? They are the emissions of those companies that are reporting on their customers. It's a bank having to disclose the emissions of its customers. It's a fertiliser supplier having to disclose the emissions of its customers. It's a merchandise provider or a livestock agent having to disclose the emissions of its customers. Every farmer in Australia should be deeply concerned about where this is going, every tradie in Australia should be deeply concerned about where this is going and every small manufacturer should be deeply concerned about where this is going, because their banks and their other service providers and suppliers are going to have an obligation to start reporting their customers' emission.

No doubt every activist in the country is absolutely salivating at the opportunity to say to that bank, 'I tell you what? We're going to do everything we can do to put you out of business unless you tell your customers how to run their businesses.' They will be telling beef producers how to run their businesses. They will be telling wool and lamb producers how to run their businesses. They will be telling tradies and builders how to run their businesses. They will be telling small manufacturers how to run their businesses. This is what the government is doing here: they're going to outsource activism to the banks and to other major service providers. When I say 'major', it's only companies over $50 million. The red tape compliance bomb here is unimaginable, and I am deeply concerned about where this is going.

For a Labor Party that thinks the only good business is a business that's fully unionised, I guess it's completely understandable. It's completely understandable that small business is your enemy when you are in the Labor Party. Small business can't be easily controlled by activist union officials, so what do you do? You wrap it in red tape until you throttle it. You asphyxiate it, and that is exactly what this bill is doing. There is so much that Labor has not explained in what they are planning here. How are they going to prevent activists saying to the banks, 'Stop lending to a farmer who doesn't do as they are told'? That is exactly where this is going to end up.

What is most extraordinary about this is that even the US, with a government that's not on our side of the political aisle, is not going down this path. The UK is not going down this path. New Zealand is not going down this path. The inclusion of scope 3 emissions is a step beyond what is reasonable for small businesses. They will pay a very, very high price.

How do you deal with a cafe owner selling coffee in the lobby of a big company? How is that going to work? They're going to have to disclose their emissions to that big company. Quite seriously, the way this is being done is just beyond laughable. A building supplier—a small tradie—providing office fit-outs to a big company is going to have to work out the emissions from his or her ute and report that to the company they're doing the fit-out for. If you're a manufacturer buying ingredients or components from a big company, or selling them—either way, actually—the law will eventually get you.

This is a kind of outsourcing of activism, which this government seems to love. We know that Labor are funding environmental activists, like the EDO, to ensure that they get what they really want. They get what they really want: the shutting down of some of the most important projects for the future of this country. Labor don't like these industries, so they will asphyxiate them.

ASIC made clear in its evidence to the Senate Economics Legislation Committee that these compliance costs will be passed on to small businesses. They've made that clear; ASIC haven't sought to hide that. They have confirmed that these concerns are so extensive they have been raised with ASIC by the Australian Small Business and Family Enterprise Ombudsman. The Securities and Exchange Commission in the United States has noted exactly the same concerns, and it's why the US are not proceeding with scope 3 emissions in their regulations.

So Labor need to see sense here, and we've attempted with this amendment to lay out a sensible pathway forward on this—a pathway that respects the role of small businesses in our economy, that recognises they are actually the engine rooms of so many of our electorates. I know members here, when I look around, would say small businesses and farmers are the backbone. I suspect that's true of those on the other side of the chamber. I know it's true of those on the other side of the chamber. But they have never been inside the Labor tent, so they're not going to get looked after; in fact, they're going to be hit hard by this. At a time when we've seen almost 16,000 businesses go into insolvency since Labor came to power, this is the wrong law. It's the wrong law at the wrong time. We are in the midst of a cost-of-living and cost-of-doing-business crisis, and it's absolutely the last thing that is needed.

Independent research shows that red tape costs the economy more than $176 billion a year, and this is going to add very significantly to those costs. We heard through Senate estimates this week, from Treasury and agency officials, who will bear the brunt of this cost. It isn't big businesses. They'll pass it on. They're not the ones who are going to bear the brunt of it. They have big departments doing this, they hire consultants—they do all of that so they can manage it. Those costs are relatively small in the scheme of the budgets of big businesses, but small businesses, who no doubt are going to have to report all of this to their suppliers and service providers, are not in a position to do it. It's not the multinational companies that are going to bear the brunt of this; it's small businesses.

Treasury analysis confirms that this bill imposes $2.3 billion in compliance costs in its first year of operation. Of course, there's no productivity benefit whatsoever in it, but productivity is not something that those opposite seem to care about. That's why productivity has gone backwards savagely under Labor. It has flatlined, according to the latest national accounts. Someone among those opposite is going to have to explain to me how you get inflation down and the economy growing at the same time as labour productivity is in freefall. The truth of the matter is that it is just not possible. It is just not possible to achieve that, and when we wrap small businesses in more red tape, as this legislation is doing, we just make the situation worse.

There is a better way than all of this. There is a better way to get the country back on track, and it is getting back to basics. It's recognising that you've got to get the productive side of your economy right, and the heart of that, as I said earlier, is small businesses and farmers, which are the engine room of our electorates, the engine room of our economies, the engine room of our communities. Every local member knows—we regional members in particular see it—that it's a few terrific, outstanding businesses, led by great businesspeople, in our local areas—

Mr McCormack: That's right—the risk-takers.

Mr TAYLOR: They drive the economy, because they're taking risks, creating jobs and creating opportunities. They give the young people in those regions the chance to get into a job, take it on as an apprenticeship and learn. And then, over time, those young people themselves often become the small-business people who are the leaders in our local communities.

Australia's 2.5 million small businesses make up 98 per cent of all businesses and employ almost half of the private sector workforce. As I said, without them, our economy is in deep and dire straits. I commend the amendments made here. We ask the government to actually give them serious consideration and see that getting the economy back on track means making sure we are doing the right thing by the small-business people and farmers of this great nation.

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

Mr McCormack: I second the amendment and reserve my right to speak.

Mr LITTLEPROUD (Maranoa—Leader of the Nationals) (12:00): I thank the shadow Treasurer, the member for Hume, for his amendment and wholeheartedly support the commonsense, back-to-basics solutions to what is a draconian bill that's going to have a significant impact on every Australian. This is going to drive up your cost of living. In the middle of a cost-of-living crisis, this government is going to add an extra $2.3 billion worth of red tape costs to those people in particular who are producing the food that you enjoy every day. This mandatory reporting around scope 3 emissions means that farmers in my electorate, little old Maranoa, such as a beef producer in Roma selling their beef to Woolworths, will have to be able to disclose to Woolworths and to their bank their emissions profile. That's an enormous cost. There's not even the science for these farmers to do that at a reasonable cost, so that cost is going to have to be borne by you, the Australian taxpayer, because you're going to have to pay more at the checkout.

Why would you impose an extra cost on farmers when there are families today that are making real decisions at supermarkets? They're putting fresh produce back on the shelf because they can't afford it. They can't afford a meal. They're actually feeding the kids rather than themselves because they don't have the money to go to the supermarket to have three meals a day. In a country of 27 million people, we produce enough food and fibre for 80 million people, and we have a cost-of-living crisis where people are making those decisions in this country today.

We as legislators have an opportunity to do something about that, to reduce the costs, not increase the costs. We had the Minister for Climate Change and Energy and the Minister for Agriculture, Fisheries and Forestry turn up to Toowoomba about a week and a half ago for a sustainability conference with the agricultural industry, telling them that we would never impose mandatory reporting of scope 3 emissions of farmers—'We wouldn't impose that on you.' Well, in this bill they're not, but they're doing it by stealth. They didn't have the courage to look those farmers and those industry people in the eye and tell them, 'Well, actually, we are, because, when you go to the bank, they're not going to be able to lend you a cent unless you can give us your emissions profile.' They are doing it by stealth. If you believe so passionately in this ideology, then have the courage to look Australians in the eye and tell them the truth: that you are going to ask little old farmers out there that are producing the food and fibre that you want. You're going to hit them with another cost. 2.3 billion dollars a year—that is what's going to be added to everything we do in this country.

Now, no-one's against us trying to reduce our emissions, but there is a uniquely Australian way of achieving it. Part of that should be common sense. Unfortunately, what this bill fails to achieve in any way is common sense. To actually impose this on primary producers when you've already had 16,000 small businesses go into liquidation since Anthony Albanese came to government—you've got to ask: why would you continue to put pressure on those that employ people in our country? Governments don't create jobs; small businesses do. The only jobs that are created here the poor old taxpayer pays for. So you should be creating an environment for our small businesses—and that includes farmers—to be able to employ people. If you impose this type of ideology on our primary producers, then it has to get passed on to taxpayers. I say to this government, when you go and look people in the eye and you give them a promise that you wouldn't be mandating around climate disclosures, and you do that publicly, then you should follow through. What this means is it's not just the banks; is also the Elders agent and the Nutrien agent who sells them chemicals or cattle, because they get caught up on this. They have to report the scope 3 emissions of their customers. That's the little old farmer in Roma and the little old farmer in Wagga sitting there producing your food and fibre. The ideology doesn't meet the practical reality of what it's going to cost the Australian taxpayer.

You can have all this grandiose ideology but, ultimately, there's one simple principle in life: someone's got to pay. That's what this mob is forgetting—someone's got to pay. There's also a little chestnut in the top drawer of this government that they've been in consultation with the agricultural industry around. It's around the safeguard mechanism and methane and the fact that they signed up to an international pledge of a 30 per cent reduction in methane by 2030. The agriculture and meat industries are all for trying to reduce emissions, but the safeguard mechanism was put in place to allow technology to be created and then adopted over time by 2050 to allow industry to reduce their emissions. There is no technology, no scientific way to reduce methane from cattle. We can't do it yet. Instead, the consultations with this government—and on their past record of what they did in Toowoomba a couple of weeks ago, saying, 'No way in the world will we mandate this,'—have been telling them that the big beef producers in this country will fall into the safeguard mechanism. They must reduce their methane emissions by 4.95 per cent every year between now and 2030. There's no technological solution to do that, so the only way to do that is to reduce your herd numbers, and if you reduce supply, prices go up. If you think it's tough buying meat at the checkout at the moment, wait until that little chestnut hits you.

This is the insanity of it. Our 20 biggest beef producers are now being threatened with effectively being put under a safeguard mechanism that will actually drive up the cost of food. At some point, the ideology has to get to the practical reality about food security for every Australian. They should be able to go to a butcher or a supermarket in this country and not have to miss out on a meal. I would have thought this place, this great institution that we have been given the privilege to stand in, would have thought primarily that that is one of the core responsibilities that we have been given—to ease that burden on our fellow Australians so that they can have three meals a day. I think it's a shame on all of us that there are families making those heart-wrenching decisions at supermarkets every day today. So why would you make it worse? Why would you add $2.3 billion of extra costs onto farmers in this reckless race to try to achieve a goal by 2030?

There is a human toll to this. That human toll is those young families and those young people who are at university or in low-paying jobs who are making those decisions today. I would have thought it was up to every one of us to make sure the decisions they make at that supermarket is about making healthy choices, about having the freshest and best-produced food in the world—from Australian farmers. Unfortunately, this government is going to put that continually out of the reach of those people. That's the human toll the decision this government is going to make today will have. That's why Australians need to understand the ideology of this government. While I respect they have a different view to me, and I respect their ideology is different, I just believe there's a different way we can achieve this. There is a uniquely Australian way. We can use some common sense. We can use the sovereignty of the resources that we have been blessed with in this country to achieve all our international commitments without the human toll—without the heart-wrenching human toll that people right around this country are making every day. But if this government is hell-bent on this ideology, understand that human toll will grow.

That's not what we should be about in this place. That's not what we've been given the privilege to come and do. We've been given the privilege to come here and make Australians' lives better and easier. But, instead, an ideology has got in the way of the practical reality. So I commend the amendment that the shadow Treasurer has made, because that is the basic common sense that we've got to get back to. You can't keep spending Australian taxpayers' money to solve the nation's problems and you can't keep taxing them into submission, because there is a human toll and that human toll will be squarely at the feet of the Albanese government.

Mr HOGAN (Page—Deputy Manager of Opposition Business) (12:10): I rise to speak in favour of the amendment moved by the member for Hume. There's a lot in this bill, the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024. Some of it we agree with and some of it we would wave through. I'm going to touch very briefly on the payments reform part of this bill, and then I really want to go in and talk about the mandatory climate disclosures and what that is going to do if this bill goes through as drafted by the Labor Party.

Firstly, with the payments reform, as the member for Hume said, we're very concerned about the proposal to remove parliamentary scrutiny over the changes to the voting power on the ASX. Currently those voting powers are limited to 15 per cent, and any change requires regulations to be altered. We've moved amendments on that.

But let's go straight to the mandatory climate disclosures. I think that, if you were to look at any bill and any legislation that passes through this parliament, somewhere in there you'd see, I hope, good intentions or something altruistic that is good for the community, good for the country, good for businesses and good for families. I suppose, in some way, you can see what this government is trying to do here, and you can see an altruistic plan that they have about this. But, again, as the Leader of the Nationals just articulated, what this bill does and what this really quite extreme left-wing government that we have in power at the moment—I'll actually say this is probably the most extreme left-wing government we've seen in this country for many, many decades.

Mr McCormack: Since the last Labor government.

Mr HOGAN: I think they're much more extreme than the last Labor government, with all due respect, Member for Riverina. They're more extreme than the last Labor government. They're more extreme than the Hawke-Keating Labor governments. This is an extreme left-wing Labor government, and I think that this legislation is showing that and proving that. Why am I saying that? Well, let's go through it.

I think the terminology that's been used is quite accurate. Their ideology is making them blind to common sense. Their ideology about what they want to achieve altruistically means that they don't have any regard for what that means on the ground for the men and women of Australia, whether that be families or businesses. They are oblivious to that because every form of legislation that they have is completely fixated on ideology. They say: 'This is what we want to achieve, and we're going to go for that even if that decimates business or makes the cost of living higher. Whatever the cost is, we don't care.' That's what makes this government so dangerous.

They get up every day and talk about the cost of living and say that dealing with the cost of living is the No. 1 topic on their agenda and that they are working every day as a government to deal with the cost of living. This bill alone increases the cost of living, and there are many other examples. In fact it's the case for most of the legislation they move through this place. So they can say what they like. They can say whatever they want in here to try to get a sound bite that they think may resonate on a news clip with the families and the business of Australia. That news clip might be what they think Australians want to hear, and it probably is if it's a grab. But let's look at what they're doing here in practice and what they're doing with this bill in practice. This bill that we are debating right now that was drafted by the Labor Party and that they want to pass is going to increase the cost of living for every Australian—full stop. I don't think you'll hear any of them try to get up and defend it and say that it won't. This is not us saying that; this is independent analysis about what the cost of this bill will do.

It is going to cost over $1 million for any business that does this. I'll repeat that. This was said in Senate estimates this week: it will cost over a million bucks for a business to go through this. Again, we have moved an amendment, but we will be opposing this bill without that. I note other speakers have said this as well. The ASIC chair, Joe Longo, has described the changes as the biggest changes to corporate Australia in over a decade. This is not a minor bill. This is not just something little going through with Labor trying to do the right thing. What they are doing is making a drastic change to the reporting requirements of businesses in Australia that is going to cost the economy billions of dollars. Guess who'll pay those billions of dollars in extra costs? It will be the Australian family and the Australian consumer. Well, thanks for that. The next time you get up and bleat on about the fact that you think that the cost of living is important, have a look at the legislation you are passing every day on the back of this. It is just ideology. They don't have common sense. It's ideology over everything else.

Let's just go through this and talk about it. I know a lot of people in Australia might not necessarily understand what we're talking about. We've talked about scope 1, scope 2 and scope 3 emissions. Scope 1 emissions are reasonably easy for a company to determine. It's really just, if you're making something—say, you're a small manufacturer—you measure the emissions that you put out. Most companies do that now and have a fairly good idea about that. Scope 2 emissions are the electricity ones, and most electricity providers have really good systems for measuring the emissions they put out. That's not complicated. But scope 3, which is what this government has in this regulation, is where the problem is. This is where the reporting is going to be difficult. This where the cost is going to be put onto business. This is a higher compliance than in places like the US, New Zealand and the UK. They haven't got it. The US didn't go there. Look at how left-wing Joe Biden and his government are. They haven't done this. They haven't regulated this. But this extreme left-wing government, this exceptionally ideologically driven government, don't care about the increased costs, don't care about the onerous compliance costs, don't care about the cost this is going to put onto small business and don't care about the costs that are going to be transferred to Australian consumers, families and businesses. That's what we're talking about here.

I am going to repeat some figures because it is important that we hear them again. This is a $2.3 billion-a-year compliance cost. This is at a time when cost of living is really difficult. Small businesses are doing it really tough. We know that everyone's electricity bill has gone up. Inflation is very high in Australia, most of it homegrown. This government does not care. If this government cared about the exceptionally high inflation rates that we have in Australia, it wouldn't be throwing on top of us a $2.3 billion-a-year compliance cost to strangle business and which will be passed on to families.

I want to talk about the type of people who are affected by this as well. With scope 3, all the financial institutions will be starting to look. All the activists will be on this. The government is also funding the Environmental Defenders Office to make sure this is done properly. That's just a team of activists—talk about ideologically driven. I don't think they will care if a business is shut down if they don't like what the business does or they don't think that business is doing the right thing. They don't have any compassion for the business or the people who work there. They will be the police of this. This will part of the requirement of this, which will be disastrous as well.

As has been said, this will be a creeping thing. So this will not just affect big business. Big business is obviously the first round of this. If you are over a certain size of turnover and staff you will have this obligatory reporting. Those financial institutions and some of those businesses will be looking down their supply chain for some scope 3 issues. They will be coming to farmers, small manufacturers and a lot of other businesses and saying, 'You need to measure and tell me what emissions you have in your business.' I say to those opposite: you are talking with a forked tongue when you say you care about cost of living when in the same breath you are passing this legislation and other legislation, which we might be talking about later today, which is the same thing.

You were saying you care about cost of living, your words say that, but your actions say something exactly the opposite. Australian families and Australian businesses are going to suffer, because of this legislation and other legislation that you're putting through. Your words do not match your actions. Your words say you care about cost of living, your actions say you do not care about the costs and the extra costs you're putting on Australian families and Australian businesses. They will be worse because of the government you are—the extreme left-wing government you are—and the legislation you keep passing.

Mr VAN MANEN (Forde—Chief Opposition Whip) (12:20): It's a pleasure to follow the member for Page's contribution and I also note the contributions from the shadow Treasurer and the leader of the Nationals earlier in this debate. We were just upstairs in the Federation Chamber talking about the appropriation bills and reflecting on the vast difference there is between what this government says and what it actually does. I say frequently to people, 'Don't listen to what they say, look at what they do, because nine times out of 10 they are two completely and utterly different things.

As the member from Page has quite rightly pointed out, this bill will not help reduce the cost of living. It will actually increase the cost of living for each and every Australian. We've moved a set of amendments to try and make this bill better. I doubt the government is going to support those amendments we will move, because we don't support this bill because we think it's fundamentally antibusiness. As you look at this bill it reaches into every aspect of our economy.

Most people probably don't realise that we already have some reporting requirements for large businesses in terms of scope 1 and 2 emissions, which are emissions that they've either directly generated or indirect emissions from the purchase of electricity or other inputs into the business. What we're talking about essentially in this bill now are scope 3 emissions, which are indirect greenhouse gas emissions that aren't included in the scope 2 greenhouse gas emissions but occur in the value chain of an entity including both upstream and downstream emissions including financed emissions.

Medium-sized business could be caught by this. There are three groups of entities. Group 1 entities have consolidated revenue of $500 million or more or consolidated group assets of a billion or higher, group 2 entities have consolidated revenue of $200 million or more or consolidated gross assets of $500 million or higher, while group 3 have consolidated revenue of $50 million or higher or consolidated gross assets of $25 million or higher. All of those entities are required to report or will be required to report the scope 3 emissions from all of their suppliers upstream and downstream.

What happens to a small manufacturing business in the electorate of Forde that supplies four or five of these companies? How do they account for the emissions that they generate? By the way, they don't have to do this currently. They're exempt from the current scope 1 and scope 2 emissions regime. So, they've got to bring in a set of consultants to go through their entire business and work out what their emissions are so they can start to report them. How do they account then to each of their suppliers what the emissions component of the goods that they supply them are?

I know that in this bill there's an estimated cost of $1.3 million per year for these large businesses that have to comply with these requirements and an overall estimated economic cost of some $2.3 billion dollars in regulatory impost for no productivity gain whatsoever—zero. We're already in an environment where productivity is declining. We're seeing a new set of regulations that's only going to make productivity worse because it is of no productive value to the country whatsoever, unless you're consultancy business that actually has to calculate these emissions for all of our small businesses across the country.

These are small businesses that don't have HR departments and don't have in-house accounting teams. They get up each and every day and open their doors, putting that families' livelihoods and futures on the line to employ Australians and produce goods that those opposite say they want produced in Australia under their Future Made in Australia goal. But, again, what are they doing? They're just putting another roadblock and another hurdle in the way of the small businesses in this country, which take the risks to innovate, grow and develop the ideas that will benefit this country into the future.

At the same time that they want to spend several billion dollars on their made in Australia fund they're actually making it less attractive for business to stay in Australia. The Assistant Treasurer, who's in the chamber at the moment and I'm sure will sum up after I've finished, made a comment in the Federation Chamber earlier, in consideration in detail, about where we want products to be manufactured. I can tell the House that I want products to be manufactured in this country by Australia so that they can afford to keep a roof over their heads, feed their families and build the wealth and creative capacity of this country. That's what I want to see, but as I look at this bill I don't see that happening, sadly.

I was talking to one of my local manufacturers, a textile manufacturer, quite recently. That manufacturer is actively discussing shutting down and moving overseas because it is just becoming too difficult to do business in Australia. What is one of the key inputs that is becoming so expensive for them? It is electricity and gas. Yet this government promised before the last election that they would reduce electricity and gas prices. They've done nothing of the sort. Rest assured, that business that I just mentioned will be caught in this legislation, which will make it even less attractive for it to stay here in Australia.

I can assure the House that the estimate of a $2.3 billion impact on our economy is so far short of the mark that it is beyond funny. I would suggest that that $2.3 billion cost has been calculated on those group 1, group 2 and group 3 businesses. I doubt very much that the government or Treasury has done the work to identify the economy-wide costs for every single business in our economy of having to comply with the regulation in this proposed legislation. This is on top of the myriad of other things that this government is doing to make life difficult for business. Whether you're a small manufacturer in my electorate of Forde or a farmer in the electorate of Riverina, you are going be impacted by this.

Nobody has really talked about or mentioned at this stage what is also potentially going to happen. We have seen it occur overseas or at least raised as a question overseas. What are the banks going to do with their finance facilities and businesses that are caught up in this? What reporting will businesses have to provide to their banks as part of their loan application process? What if they have an existing finance facility rollover or upgrade of their finance facilities? What about at review time? What additional information will they have to provide? If the bank doesn't like the questions that the business is providing—bear in mind that the banks are caught in this, potentially—what is the risk that the bank says, 'We don't want you as a customer anymore because we don't believe you're doing the right thing with reporting your emissions,' or, 'We don't think you are reporting them properly,' or, 'There is an increased risk to your business because of your emissions profile'? What happens in that case? Can they go to another bank and get their finance facility refinanced or not?

There are so many holes in this piece of legislation and so many risks being introduced into our economy as a result of this that it is beyond belief that those opposite can stand there, hand on heart, and say that they're a government that supports small business, as we saw the Minister for Small Business do this morning. Virtually each and every piece of legislation they bring into this place—and this is a classic example—says exactly the opposite. When 98 per cent of businesses in this country are small-to-medium businesses that employ more than 50 per cent of the Australian workforce, what is the economic impact of this piece of legislation? I would suggest that it is way more than $2.3 billion. Each and every Australian will pay the price for this. All of those sitting in the gallery, everybody that's watching this and everybody out there in the Australian community—everybody will pay the price for this.

As the member for Page quite rightly pointed out, the government is funding environmental activists, like the Environmental Defenders Office, to ensure that these regulations are complied with. We know their track record. We know what a court said about the Environmental Defenders Office recently, and I can say that it wasn't very flattering. It wasn't very flattering at all. To think that the government is empowering a group of people that want to shut down our economy or shut down particularly businesses they don't like because they don't fit within their zeitgeist, with the economic consequences for our country that that entails, is extraordinary. I thought they were supposed to be a government that govern for all Australians, not just their selected vested interests.

I am pleased that we as a coalition are opposing this bill, and we will make every effort to try and ensure that it doesn't pass this parliament, because of the cost-of-living consequences and the risk to business in an already difficult business environment where electricity costs have been going up and rent costs have been going up. If you think there's a rental crisis in the housing market, which there is, there is a rental crisis for many small businesses as well, with the inflation rates that they have been subject to by this government, which doesn't seem to know how to get inflation back down to any sensible level. It's now stuck at one of the highest levels around the world. This is only going to compound this. As these costs flow through the economy, businesses will put up their prices. If they can't put up their prices, they're going to let people go. Where we already have the situation where households with average mortgages in my electorate and across the country are $35,000 a year worse off as a result of this government's inaction, what are the broader economic consequences of this legislation? I think the government should take this and go away and rethink it, or actually put it in the bin, because it will be extraordinarily detrimental to our economy and will make the situation worse, not better. I'm pleased, as I said, that the coalition opposes this bill.

Mr JONES (Whitlam—Assistant Treasurer and Minister for Financial Services) (12:35): For the benefit of all members of the House and any members of the public who might be listening in, I thought I'd draw people's attention back to what the subject matter of this legislation is, in complete contrast to the febrile contributions from the member for Hume, followed and backed up by the member for Page, who painted a very dark picture of their own imaginings.

The Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024 does two things. The first thing that it does, through schedules 1, 2, 3 and 5, is that it amends the Corporations Act 2001 and makes a bunch of consequential amendments to establish a crisis management regime for clearing and settlement facilities in Australia. It's absolutely critical we do this, because clearing and settlement facilities play a critical role in the smooth operation of our financial markets. It's important that the Reserve Bank have the powers that it needs to move decisively to resolve, if needed, a crisis at a clearing and settlement facility. Any unmitigated crisis at a clearing and settlement facility could rapidly spread across the financial sector and into other areas of the economy.

Given that, I was astounded that the member for Forde, who is generally sensible on matters concerning financial markets regulation, has vowed to fight tooth and nail against the passage of this bill, a bill which empowers the RBA to deal with a crisis in our equities market, particularly in relation to clearing and settlement facilities. The bill does empower the RBA to, amongst other things in the event of a crisis, appoint a statutory manager to take control of domestic clearing and settlement facilities, transfer the business or shares to a third party and issue binding directions. In certain circumstances, these powers can also be used in relation to related bodies corporate of a domestic clearing and settlement facility. The bill also empowers the RBA to assist a foreign regulator to resolve a crisis in an overseas clearing and settlement facility.

Schedule 2 to the bill strengthens the regulatory powers of ASIC and the RBA in relation to financial markets infrastructure, giving them further powers to monitor, mitigate and reduce risks. Stronger day-to-day regulatory powers will help the regulators to take necessary action to mitigate risk and head off a crisis before it happens. I repeat that: to head off a crisis before it happens. Against that background, it beggars belief that somebody who wants to be the Treasurer of Australia and somebody who wants to sit on the front bench of an alternative government would vow to block the passage of this legislation. If your party espouses the principles of sound financial and economic management, it seems to me that this is rudimentary housekeeping business that any sensible government would want to do. Indeed, the Council of Financial Regulators has recommended these changes to the government and asked that we pass them as a matter of priority, and we will.

I want to deal with schedule 4 of the bill, which seems to have sent a wave of excitement, if not understanding, across members of the coalition parties. It deals with provisions for corporate climate risk disclosure. I just want to read a quote about the importance of this:

To maintain Australia's place in the global economy, the group considers it's essential there is a climate reporting framework that incentivises high quality, useful and internationally aligned climate-related disclosures.

I'm going to read that again:

To maintain Australia's place in the global economy, the group considers it's essential there is a climate reporting framework that incentivises high quality, useful and internationally aligned climate-related disclosures.

Many members of this House, after listening to the febrile contributions from the member for Page and the member for Hume, might be asking themselves: Who is this group that is recommending and saying that it is absolutely essential that we introduce this framework as proposed by the government? Could it be the International Socialist Network? Could it be the Australian Greens, whose leader has had a fair bit to say in this House and elsewhere over the last 24 hours? Could it be the Trotskyist internationals advocating such, according to the member for Page, 'a radical, left-wing, extremist Communist proposition'? It must be, given what we've heard from members opposite.

Well, I'm delighted to inform the House that this group is the peak bodies of 15 organisations, which include the Business Council of Australia, that far left-wing group of businesses; the Financial Services Council; the Governance Institute, the Property Council of Australia—now there are a bunch of red-rag, left-wing extremists. The Property Council of Australia—if ever we've seen an extreme left-wing organisation, you'd have to include them in the brackets, wouldn't you? The Business Council of Australia and the Property Council of Australia are amongst the 15 peak organisations who are recommending these changes.

The very simple reason why they are recommending these changes is that all of the concerns that members opposite have expressed about what's going on in financial markets—decisions and questions that are being asked by operators within financial markets about the businesses that they are investing in—are happening right now, but they are happening in the absence of a set of clear understandings, standards and reporting mechanisms upon which everybody can agree and through which everybody can make investment decisions and their credit decisions. They're happening overseas; those standards exist overseas. They don't yet exist in Australia.

You ask why we're doing this and why the 15 business organisations have issued a press release saying that these standards are absolutely essential and the government's got it right. You ask why they support this proposition. It's quite simple: they want the rest of the world to buy Australian goods and they want the rest of the world to invest in Australian businesses. Any party that proclaims itself the party of business and sensible economic management would have to understand that and support those two propositions.

That is why we are introducing this. We're doing it in a graduated way that understands there is a difference between large listed entities and large private corporations and small ones. There are graduated entry points. There's been extensive consultation and discussion with business, including finance businesses and the production sector, before we brought these measures before parliament.

I make these points simply to inform those members of the House who might have been listening to the disingenuous, febrile contributions by those members opposite which speak to the dark imaginings of their minds. This bill has nothing to do with what they're talking about, and the bizarre consequences that they seek to excite members about have nothing to do with what is proposed and what will operate as a result of this legislation. I say that with confidence. You don't have to accept my word on this. You don't have to accept the words of the government on this. You don't have to accept the words of the investor community on this. Just accept the words of the peak business organisations throughout this country, who are saying to this government, to this parliament—not just to Labor but also to the coalition—'For gods sake, will you get on with it, because we need to join the rest of the world and ensure that our standards are internationally aligned. We want to do it because we want the rest of the will to buy our goods. We want to do it because we want capital markets internationally aligned to be investing in our businesses.' With that contribution, I commend the legislation to the House.

The SPEAKER: The immediate question before the House is that the amendment moved by the member for Hume be agreed to.

The SPEAKER (12:54): The question before the House is that this bill be now read a second time.

Ms TINK (North Sydney) (12:59): by leave—I move amendments (1) and (2), as circulated in my name, together:

(1) Schedule 4, item 26, page 255 (after line 19), at the end of subsection 296A(1), add:

Note: A requirement to include something in a sustainability report is separate to any other reporting requirement in this or any other Act, and does not affect that other reporting requirement.

(2) Schedule 4, item 145, page 284 (lines 18 to 20), omit subparagraph 1707D(3)(b)(iii).

While I welcome this legislation, as outlined in my second reading speech my community and I are concerned that, as it currently stands, it includes a broad modified liability approach for the commencement of sustainability reporting for the first three years of the scheme. While the government argues that this is designed to ensure reporting entities, auditors and directors are allowed time to develop experience and practice to report in line with the required standards, the Senate Economics Legislation Committee inquiry found many experts had concerns regarding the inclusion of a three-year modified liability. In many instances, their concerns were tied to the fact that in Australia we already have high rates of corporate greenwashing, with at least one in two companies surveyed by the ACCC in 2023 having been found to be promoting concerning claims about their environmental credentials.

The right for third parties and consumers to hold companies, businesses, governments and individuals to account for making false or misleading statements is crucial not only to our society's general health but specifically to the proper functioning of any market. At a time when urgent climate action is critical and consumers and communities are demanding faster action to regear our society towards a future-focused economy, it's essential entities are held to account for greenwashing and promoting false solutions to the climate crisis. We are so far behind the rest of the world when it comes to adopting this reporting framework. Many of the companies that will be covered by the proposed modified liability arrangements here in Australia are actually already working to them in other markets. At the same time, many have voluntarily been reporting on climate-related risks in Australia also. Beyond those two facts, the truth is that the government has been signalling that this reform was coming, and the entire economy has had sufficient notice of proposed reporting requirements.

For this legislation to be as effective as it can be, my community argues that it should include a higher standard for those companies that have already begun to report in this way, while allowing room for the development of competency among those businesses which may be stepping into this reporting model for the first time. We agree that some form of indemnity provisions would be appropriate given the scale of this reform, and transitional measures would encourage more fulsome reporting and proper understanding of the requirements by companies and directors. We agree that we need to get the balance right. But we also argue that we should go as far as fast as we can, as we are already so far behind other markets, and we should not excuse wanton abuse to date by building an escape hatch for those businesses who should know better.

The amendments that I am proposing remove immunity relating to transition plans, while retaining the rest of the bill's modified liability plan. Transition plans are company-led initiatives which are based on company business models. The integrity of these plans is important for investors and capital allocation, and any information contained within them should be considered to be of the highest calibre. In the exposure draft of this legislation, the only statements covered by the three-year immunity from private litigant action were those made in the sustainability report about scope 3 greenhouse gas emissions and scenario analysis. The exposure draft did not prevent third parties from taking action in relation to a company's transition plan, meaning it would have been open to third parties, including investors, to take action against a company for making misleading statements in relation to its climate transition plan. Following a period of public consultation on the exposure draft, the federal government made two amendments which significantly broadened the scope of the immunity provisions to include transition plans and any forward-looking statement made in a sustainability report during the first year of the regime. In doing so, the government strengthened the protection for entities against liability for greenwashing. I fear that has left many of us concerned that there are indeed businesses currently in our market making false claims, and they are being told they are getting extra time to tidy their house.

The inclusion of transition plans in the immunity provisions is a significant departure from both the proposals in the exposure draft and the general application of misleading and deceptive conduct provisions in the Corporations Act, the ASIC Act and the Australian Consumer Law. Given that any business already presenting these transition plans has developed a level of proficiency in their creation, they should not be able to tap into immunity from private litigation. I commend my amendments to the House and thank the minister and his team in advance for considering them seriously.

Ms STEGGALL (Warringah) (13:04): I rise in support of the amendments moved by the member for North Sydney. They are very much in keeping with amendments that I had also circulated around concerns for the provisions to allow a grace period per se, or an exemption from prosecution in relation to a failure to properly report or mistakes. We know greenwashing is a major problem. As the public becomes more and more aware of the importance of the corporate transition to net zero—reducing their emissions to sustainable levels and reducing the footprint of their supply chains—we need to ensure there is corporate accountability in this space and that major corporations and entities caught by this legislation are, in fact, doing what is necessary.

A lot of these disclosure frameworks and requirements are already in place in a voluntary way and are the general expectation internationally. It's important for us to understand that Australia is not a first mover in this space. We are, in fact, behind similar jurisdictions in relation to this requirement of disclosure. So it would be wrong to think that corporate entities are somehow being caught by surprise by this requirement to properly assess and disclose their exposure to risk, especially in relation to their supply chains.

I think it's important for legislation to find the right balance between putting additional requirements on corporate Australia and acknowledging that for some this might have some transition issues. I understand there's already been negotiation with the government to extend the timelines in which some of the provisions will come into play for the different groups of corporate entities to allow them additional time. With that in mind, I don't see the necessity for a provision which gives a further grace period in relation to misreporting. I very much support that provision being taken out of this legislation.

Mr JONES (Whitlam—Assistant Treasurer and Minister for Financial Services) (13:06): I thank the members for North Sydney and Warringah for their engagement and for their thoughtful contributions to this debate. I don't doubt for a moment the genuineness of the sentiment which motivates them to bring these amendments to the House. Ultimately, these are questions of balance and judgement, and on balance and judgement we won't be supporting the amendments. Many of the factual contributions they've made are correct, and I don't cavil with those, but we've had to get the balance right.

I do simply make the point that throughout the transition period the corporate regulator will still have the power—in fact, the function—of ensuring that any breaches of those disclosure obligations are enforced and may be prosecuted through the court system. It's not as if that through the transition period there is no enforcement available. There is enforcement through ASIC in its function as the corporate regulator responsible for the enforcement of these and other provisions under the Corporations Law.

With those comments, I confirm that government members won't be supporting the amendments.

Question negatived.

Bill agreed to.

Mr JONES (Whitlam—Assistant Treasurer and Minister for Financial Services) (13:09): by leave—I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Mr JONES (Whitlam—Assistant Treasurer and Minister for Financial Services) (13:10): by leave—I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Mr JONES (Whitlam—Assistant Treasurer and Minister for Financial Services) (13:11): by leave—I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Mr JONES (Whitlam—Assistant Treasurer and Minister for Financial Services) (13:12): by leave—I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Mr PERRETT (Moreton) (13:13): I rise today, on 6 June, in support of Labor's Nature Positive (Environment Protection Australia) Bill 2024, Nature Positive (Environment Information Australia) Bill 2024 and Nature Positive (Environment Law Amendments and Transitional Provisions) Bill 2024. I mention the date of 6 June because, as all sensible people know, this is Queensland Day. I'm wearing a maroon tie today, and I'm sure my whip would note the maroon tie, because I think there was a game of rugby league last night that was apparently quite significant—but I digress.

These bills introduce reforms that will build a nature-positive Australia. Before I go to the substance of the bills, I want to particularly thank Labor Environment Action Network, LEAN, volunteers from all around Australia for the great work that they have done to ensure that this legislation came to the chamber. I particularly call out their leader, Felicity Wade, and also, in Queensland, Peter Casey and his team of incredible volunteers who've done so much for the environment over the years.

What does 'nature positive' actually mean? The short answer is: repair and regeneration rather than decline and destruction. It means strengthening our ecosystems and all their component parts. It also means recognising our unique environment as a natural asset to be protected and strengthened—recognising the environment as an asset.

When Labor came to government two years ago, the Minister for the Environment and Water released the State of the environment report. This is a five-yearly report. It is a report card, if you will, on what is happening in the environment. It should've been handed down in December 2021, when the Morrison government was on this side of the chamber, but the former minister, the now deputy opposition leader, did not release the report. That was undoubtedly because the report card stated: must try harder.

I don't mean to be flippant, as the decade of environmental neglect from those opposite is definitely no laughing matter. The report said that the Australian environment was in very bad shape and was declining. To this day, it is sobering reading, a national catalogue of shame. The report said that Australia had lost more mammal species to extinction than had any other continent—and remember that most of our mammals are found on no other continent. The report card said that Australia had more foreign plant species than native species. The report described how land the size of Tasmania had been cleared. It's hard to imagine the scale of ecosystem destruction.

The report also noted that up to 80,000 pieces of plastic per square kilometre are littering our oceans and that the flow of Murray-Darling tributaries had reached record low levels. I say that as someone who grew up beside those rivers—besides the Balonne River.

How cowardly was it of the former minister not to release that report with that last election looming? The coalition, the party of climate change deniers, had spent their decade in office promising schemes they would never deliver, cutting funding and, yes, even notoriously laughing at the plight of Pacific island nations faced with rising sea levels. Do you remember that from the member from Dixon? He was standing under that boom mic laughing at the plight of our Pacific island family, our own neighbours. This subsequently spoiled relationships in our own backyard, making it more dangerous for the next generation of Australians and enabling other actors who are not necessarily intent on doing good to go into the Pacific region.

The coalition sabotaged the Murray-Darling Basin Plan, they ignored the Samuel review, they set recycling targets but didn't deliver, they reduced the size of marine parks and they cut funding to the department by 40 per cent. Is it any wonder they received an F—F for fail—on their report card. By the end of their time on the Treasury benches, the coalition had all the freshness and vitality of Weekend at Bernie's II. Now, in their third instalment, they've actually got Bernie running the show when it comes to the environment.

With all that on their record, it's alarming that the Leader of the Opposition still wants to weaken our environmental laws and give the go-ahead to damaging projects like Clive Palmer's coalmine right beside the Great Barrier Reef. The only renewable resource that the coalition believes in is ignorance.

You can see that, in May 2022, the Albanese Labor government had urgent work to do both to address the environmental vandalism and the related effects of a decade of neglect and to design measures to repair and regenerate our environment. Last year, we passed legislation that established the Nature Repair Market, which is a world first. We also enhanced our environmental laws to ensure that the minister must assess all unconventional gas projects that trigger the environmental legislation that the Commonwealth government is able to implement. Remember, we are bound by that thing called the Constitution in terms of what we can make environmental laws about.

The nature protection suite of bills is the second stage of our plan, and I'm proud to be talking about them today. This second stage of reform focuses on stronger environmental powers, faster environmental approvals, more information about the environment, and greater transparency. The legislation is good for the environment, good for the people of Australia and good for business. We're fixing laws so that they are less bureaucratic and provide more certainty for business. However, the key focus remains on repairing our environment. It is important that we let businesses know what they can and can't do, because most businesses, if they get certainty about a decision early, can move on and do more positive things. But, as I said, the key focus remains on repairing the environment, protecting our unique flora and fauna and preventing extinctions.

I recently hosted a community forum with the Wilderness Society in my electorate. From the discussions at that gathering, I know that this is what my constituents and all Australians want. We all value our environment and we're proud of its uniqueness. Australians expect Labor to look after the environment, and that's what we're delivering with our Nature Positive Plan. No government has done more for the environment and climate than the Albanese Labor government.

It was an election promise to establish an independent Environmental Protection Agency, to be called Environment Protection Australia, or the EPA. The minister describes it as 'a tough cop on the beat'. This agency will be strong, national and impartial and will ensure compliance with environmental laws to better protect the environment and, as I mentioned earlier, make faster decisions. It's important to note that the EPA will be enshrined in legislation as an independent statutory authority, giving it that arms-length protection. It will be separate from the department and the government and will have its own chief executive officer and commensurate budget.

It's crucial that we establish the EPA as soon as possible. It will enable a smoother process during the transition of responsibilities from the department to the agency. And we need it up and running before it is tasked with implementing our new environmental laws. The EPA will implement and integrate environmental data collection. We need to have meaningful, consistent and reliable data to make evidence based decisions that will support our drive to protect 30 per cent of our land and oceans by 2030.

In that community forum, I was shocked to see how much land is still being cleared in Queensland that does not reach the trigger point for the EPBC Act. I see my next-door neighbour nodding in agreement. It is a concern that people are able to do broadscale tree clearing in significant old-growth parts of Queensland and they do not have to consider all the koalas and other things that are in that environment. That's something that we need to work on with our state counterparts.

The EPA will also have the responsibility of fixing the current regulatory system, which everyone agrees has major flaws. Its decisions will uphold regulations and be transparent, accountable, efficient and focused on nature positive outcomes. I'm sure that the National Party, with their new-found enthusiasm for ensuring that no trees are cleared for solar panels or wind farms, will also embrace the idea that nature is protected for the inherent benefit of that asset rather than just for the anti-renewable jihad that they're on at the moment. The idea that you can have somebody riding around tilting at windmills—I can just see the member for New England on his old donkey, tilting at the windmills, saying: 'We must stop it. We must stop these dragons from taking hold of our landscape.' It's bizarre to think that that line of argument is occurring in 2024. So the EPA is going to have a big responsibility.

We want the EPA to be something Australians have faith in and are proud of. The EPA will be a truly national regulatory body, responsible for issues that affect us all, from recycling and waste exports to hazardous waste, dumping at sea, the wildlife trade, improving air quality and protecting the ozone and underwater cultural heritage. That's a wide range of responsibilities, and they are all necessary to repair and regenerate our environment. Having a tough cop on the beat is crucial when you consider that the Samuel review found that the regulator is not fulfilling this function. This was backed up by a government audit which found that one in seven projects using environmental offsets under current legislation had either obviously or potentially breached their approval conditions. An additional audit indicated that one in four projects had potentially failed to secure enough environmental credits to offset the impact their project was having on the environment. This unacceptable situation must stop.

The Samuel review also showed that serious enforcement action are seldom implemented, and recommended that penalties need to be stronger—not just the cost of doing business. That's why this legislation increases the penalty for a serious breach of federal environmental law up to $780 million in some circumstances. The EPA's strong new regulatory powers to monitor and enforce compliance are a key part of the generating trust in the new body. If an organisation does not mitigate against environmental damage or commit to an offset then Australians deserve to trust that the EPA will ensure there are serious consequences. The EPA will use high-quality data to deliver proportionate and effective compliance and enforcement decisions to the minority of businesses who intend on doing the wrong thing. The EPA will also have the power to enforce a stop-work order in urgent circumstances where the risk to the environment is both significant and imminent. This will reassure Australians that environmental protection outcomes are a priority.

Another aspect of the work of the EPA will be to advise the minister in government. They'll be able to make decisions as required but, in practice, decisions will be made on the advice of the EPA. The EPA will also be required to provide feedback on improvements to environmental laws. They will work closely with the head of Environment Information Australia—the ABS for the bush—which is a position that will be established through these reforms. The head of Environment Information Australia will be an independent position with the legislative mandate to provide transparent information and environmental data to the EPA, to the minister and to the public. Environment Information Australia will work with scientists, First Nations people and other experts to collect information and to produce reliable and consistent tracking information on the state of the environment. This will enable the EPA and state and territory governments to have better access to reliable data for planning and decision-making. Good data is the foundation of driving a nature-positive Australia.

This data will not only be used by governments but it will also be used to provide evidence for investment and for policy and regulatory decisions by the private sector, by community groups, by academics, by scientists and by philanthropic groups who are doing great work in revegetation. One example of the use of better data is choosing better sites for development which minimise the impact on their environment and high-value habitats. When a minimal impact site is chosen, projects are able to be approved more quickly and more easily.

I have mentioned the word 'independent' multiple times in this speech; that's by design, because of the EPA is all about ensuring independence in reporting. This means that no more Australian governments can hide the truth about the state of the environment and hold it over to a more politically convenient time. The stakes are too high for political games. The reports will come out every two years—not five—under this legislation. We know that there's more work to be done and I am hoping that the opposition, the Greens, the Independents, the Teals and all the crossbench engage with us on these reforms in good faith. There's too much at stake. These bills respond to the Samuel review and our own audits, and set us up for the next stage of our complex environmental law reforms. We have chosen to protect our environment. We have the opportunity to repair and replenish. I urge all MPs: to look at the benefits of the strong EPA; to say yes to tougher penalties for those breaking environmental laws; to say yes to better data to inform future planning and decision-making; to say yes to defining what it means to be nature-positive in law; and to say yes to more programs, projects, policies and actions to create a nature-positive Australia. I commend the bills to the House.

Ms WATSON-BROWN (Ryan) (13:29): I move:

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

(1) notes that the Government has broken its commitment to create laws that protect nature;

(2) notes that these three bills will not protect wildlife, will not stop native forest logging and will not stop the continued expansion of coal and gas;

(3) calls on the Government to amend this legislation to:

(a) end native forest logging and the destruction of critical habitat;

(b) assess projects properly for their climate impacts to stop the expansion of further fossil fuels; and

(c) commit to a timeframe for an exposure draft of standalone cultural heritage legislation".

Labor have broken their promise to reform our environmental laws. Under the existing laws, hundreds of fossil fuel projects have been approved, millions of hectares of critical habitat have been cleared and record numbers of species have been added to the threatened list—that is patently not environmental protection. Instead, Labor have listened only to their mates, their generous donors in the fossil fuel industry, and delayed these crucial reforms. Environmental protection can wait but if you're a fossil fuel company Labor won't hesitate to act on your directives.

The DEPUTY SPEAKER ( Ms Claydon ): Unfortunately, the debate is interrupted in accordance with standing order 43. The debate will be resumed at a later hour, and, given your speech was interrupted, you'll be granted leave to continue speaking when the debate is resumed.