Senator WHISH-WILSON (Tasmania) (09:31): Just to summarise, it's taken 16 years to get a process in place and a legislative outcome in parliament to provide director identifying numbers in this country on our business register. At the same time we're going to get a modernisation of our business register and a reform that sees the ownership of this register and the management of this register transferred from ASIC to the Australian tax office. It's taken 16 years of talking to get something as simple and important as a verification process, an authenticity process, in place that provides transparency in corporate Australia as to who is actually the director of a company so that we can have faith and confidence that those directors are genuine.

I want to raise in my contribution today another legislative reform that's essential to providing transparency to help prevent against tax evasion and to help prevent against misconduct, phoenixing—a whole range of corporate misconducts that we often talk about in this place. And that's the introduction of a beneficial ownership register in Australia. This is something that the Greens have been campaigning on for some time as well as a number of stakeholders around the country who want to see tax justice, who want to see the rorts cracked down on. I'll just read for senators a very brief comment from Michael West, who does fantastic work on exposing some of the rorts that we have in our tax system, the companies that often get away without paying tax and, more importantly, the solutions to help fix these issues. Michael says:

What is the point of a beneficial ownership register?

For those who have not had the pleasure of acquaintance with a beneficial ownership register, the point of a beneficial ownership register is that if people are required to disclose what they own, the things they own will be taxed more effectively.

Pretty simple really. Rather, it seems:

Better to hide them, make up silly names and concoct tortuous transnational structures which nobody can decipher. Better to stuff money into tax havens.

To put it another way, the point of not having a beneficial ownership register is therefore to facilitate tax evasion and allow corporations and wealthy investors to conceal their assets.

It might interest the chamber that it's not just the Greens that have been campaigning to have a beneficial ownership register put in place in this country to provide transparency on matters related to tax evasion and other unethical behaviour. Previous member of parliament and minister for finance Kelly O'Dwyer is also on record as having public support for a beneficial ownership register. She is not only on record; she instituted a process so that we could actually have legislative reform in this area. She announced a consultation paper in 2016 and said that a public register would greatly benefit in the fight against tax avoidance. Minister O'Dwyer at that time said:

Improving transparency around who owns, controls and benefits from companies will assist with preventing the misuse of companies for illicit activities including tax evasion, money laundering, bribery, corruption and terrorism financing.

But surprise, surprise: large parts of the corporate sector in this country, including tax lawyers and others, have strongly opposed the government's plan to establish a register and have lobbied very hard to prevent this from happening.

I've put a number of questions both directly to the Australian tax office and to Treasury at estimates, on notice and in Senate inquiries as to why this reform has never eventuated. I suppose I should take pause for thought that it took 16 years of this issue being raised in parliament before we actually got something as simple as a director identification number. But I want to tell the senators who are interested in this debate what Mr Chris Jordan said when I asked him about his views on a beneficial ownership register. He had a slightly ambivalent view on the need for it. He accepted that anything to do with increasing transparency was good. However, he said:

A register of beneficial ownership is just, you know, what someone says someone else owns so, you know, it could be good but it could be just a lot of 'stuff' that doesn't really help us.

But the important point was what he said next:

Because if, you know, people want to do the wrong thing they'll be putting all sorts of different names in places, so I'm not sure it's a panacea as such.

Stop and reflect on that: putting different names in place. The whole point of the legislation before us today is to take away the ability for dodgy operators to put up dodgy names as Australian company directors.

I said yesterday that if you go to the Australian Business Register and look up company directors you can find Elvis Presley as an Australian company director. You can find Bob Marley, not to mention Homer Simpson and a whole range of interesting people who are registered as company owners in Australia. That's going to stop if we, hopefully, pass this reform in the Senate today. When we have a modernised registry, we have the technology structures in place and we have the ability to give a company director an identification number for life, it will make it a lot easier and a lot more effective to therefore have a beneficial ownership register. I hope that this is just one of many steps in place to see that legislation come before parliament.

I would finally like to cover where we're at with a beneficial ownership register. I last asked about this issue in October estimates last year. I put it to Treasury. I said that I understand the government is committed to the G20 high-level principles of beneficial ownership transparency. And I should point out that this is not just an issue in Australia. It's a huge issue in the United Kingdom. They've continually dodged legislation to bring in a beneficial ownership register. You can only guess why. There have certainly been a number of allegations around the fact that this government and the UK government are simply protecting their donors and tax evaders.

But I asked a question around the international push and whether we were complying. Our commitments made under previous Minister O'Dwyer were specific commitments to begin work to implement a government decision on transparency of beneficial ownership companies. I wanted to know exactly what the government's decision was going to be, and the process. The answer I got was that, yes, the government is committed to enabling regulators and law enforcement agencies to tackle illicit activities, such as tax evasion, terrorism, financing and money-laundering, by giving them access to information on who owns and controls companies, allowing authorities to follow the money and to reveal the natural person that ultimately benefits from a company.

But this was part of the government's Open Government National Action Plan in 2016-2018—a plan that expired more than two years ago. I have continually put questions to Treasury, asking: 'Where are we with this? What's happening?' And I get complete and total nonanswers back, as in: 'Government decisions are in that plan, and that's two years old. Take that up with the government.' In other words, there is no momentum in this country at all for a beneficial ownership register.

Now, the government did consult publicly on this in 2017. Apparently they have consulted on a number of options to improve beneficial ownership transparency, including the establishment of a central register. But the government needs to commit to this, to step up and to make it happen. I hope that Senator Hume, in her contribution today, will be able at least to respond to this as to where we are with the beneficial ownership register. I know she had a lot of respect for Minister O'Dwyer, who personally wanted to see this register put in place. I even note that previous senator George Brandis supported this initiative.

But, lastly, having director identification numbers in this legislation today will make it a lot more effective and easier to have a beneficial ownership register. I will finish my contribution on that point.

Senator VAN (Victoria) (09:41): I rise to speak on the Commonwealth Registers Bill 2019 and its associated legislation today. Despite the volume of legislation before us, I know just how important this initiative is.

Before I go into the details of the bill, I would like to recognise this government's continued commitment to ensuring that Australian businesses can survive and thrive in these difficult times. As many people here know, the Morrison government has introduced a number of initiatives to cushion the economic impact of the coronavirus and to help build a bridge to recovery. A total of $260 billion is being injected into the economy by our government in order to keep Australians in work and businesses in business. This includes $83.7 billion for the government's economic stimulus package, $90 billion from the Reserve Bank of Australia, $15 billion from the government to deliver easier access to finance and, lastly, the $70 billion JobKeeper payment. This economic support package is equivalent to 13.3 per cent of our GDP.

The government is taking this unprecedented action to support small businesses, tradies, employees and those who are facing tough times ahead. Support covers casual workers, sole traders, small and medium businesses and also industry sectors, such as agriculture, aged care, universities and of course health. It also covers regulatory protection and financial support for businesses to stay in business, giving them the breathing space to work out the best way to keep their businesses moving.

Through the government's $40 billion SME guarantee scheme, we will support small- and medium-sized business enterprises to get access to working capital to help them get through the impact of the virus on their business. The scheme will complement the government's initiative to cut red tape to allow SMEs to get access to credit faster. It also complements announcements made by Australian banks to support small businesses with their existing loans. This builds on the support for business and business investment provided in our economic support packages. That includes increasing the instant asset write-off and, now, extending the $150,000 instant asset write-off for six months through to 31 December 2020. It also includes backing business investment by providing accelerated depreciation deductions. The package also includes temporary relief for directors from any personal liability for trading while insolvent. The Corporations Act will be amended to provide temporary and targeted relief for companies to deal with unforeseen events that arise as a result of the coronavirus.

So, what would these bills do? These actions address the most immediate and pressing needs of business as a whole in these challenging economic times. But we on this side of the chamber are looking ahead to ensure that the economic circumstances recover and that doing business is easier into the future, and these bills help do that. As the Productivity Commission's 2015 report Barriers to business set-up, transfer and closure noted:

While it is relatively easy to start a business, a number of longstanding issues with specific regulatory requirements, regulator engagement and funding remain unaddressed. These make entry for some new businesses unnecessarily complex or costly.

Part of the challenge is the need to register and then re-create information needed to register a business. This can cover Commonwealth, state and local government requirements and requires new businesses to expend enormous amounts of time and money to complete. Initiatives such as the Australian business account initiatives and the Australian Business Licence and Information Service have helped overcome some of the information challenges that businesses face in understanding the requirements of registration, licensing and permits at all levels of government.

But they also lack the capacity to share data and information easily. We cannot go on having multiple business registers all over government. By some accounts, in the Commonwealth setting alone there are numerous types of regulatory registers that businesses may have to register on, depending on their circumstances. To me, as a previous small business owner, that is absolutely crazy and creates a red-tape burden full of time-wasting and duplicative effort by business owners. That may be alright for businesses that can afford to employ people to help them with that, but it is an expensive and time-consuming process for small business, especially if they also have to deal with state and local government registration requirements as well.

These bills, modernising the business registers, will address registry fragmentation, improve business user experience, reduce risks to ongoing operations, foster data-driven innovation and enable better use of registry data. They might even build upon the great work already done in the business account and business licensing initiatives. Just imagine a business registration that allows Commonwealth agencies to share ABR data and allows state and local governments to incorporate ABR data into their systems to improve the experience for new businesses starting up in their jurisdictions.

To achieve this, the IT infrastructure underpinning Australia's business registry services needs to be addressed to meet demand for registry services now and into the future. No longer can we have government IT systems designed in such a way that they are bespoke, are increasingly complex and cost extraordinary amounts of time to change or modify. Some systems can take up to 40 days of testing just to modify one line of code, because they are so complex and interdependent in their design. We have to be able to create an environment where data can be processed, shared and updated easily, to the benefit of government, business and the community as a whole.

To facilitate the implementation of the new registry system, a legislative package has been drafted that creates a new regime that is flexible, technology neutral and governance neutral. With this approach, the registrar will have the flexibility to make data standards that determine what information will be collected, how that information will be collected and the manner in which the information will be maintained. The registrar can make a disclosure framework to provide the basis for disclosing protected information to the public. The disclosure framework is designed to replace a one-size-fits-all approach to publicly available data to one where information is disclosed by using a risk based approach.

The government acknowledges that while directors and companies have needed the breathing space to deal with the impacts of coronavirus, there are still those who have a history of continually breaking the trust of consumers, employees and partners. This legislation seeks to address this abuse by introducing a requirement for each appointed director of a registered body corporate to have a director identification number, a DIN. The objective of the new DIN requirement is to promote good corporate conduct. In particular, it will assist regulators to detect and address unlawful behaviour and, through doing so, deter such behaviour. The DIN will be a unique identifier for any person who consents to being a director and verifies their identity. The person will keep the DIN forever, even if their directorship with a particular company changes. This, too, is an important initiative that also came from the Productivity Commission's report that argued for greater transparency and accountability of directors who sought to avoid their obligations through the insidious practice of phoenix companies.

In my concluding remarks, let me reiterate just how important this initiative is for Australian business. By reducing red tape to make it easier for business, improving shared data and information sharing at all levels of government, and by helping the better governance of business, the Morrison government is making it possible for businesses to thrive in these difficult economic times. I also acknowledge the hard work of those current and former public servants across government who have striven over the last three-plus years to see this initiative through. While in recent weeks it has been fashionable for the opposition to berate the Treasury portfolio, teams from across the Australian Business Register, ASIC, the ATO and the departments of industry and Treasury, have worked tremendously hard to overcome numerous hurdles and bring this initiative to life. It is through their hard work and professionalism in dealing with such legislative complexity that the government can deliver on its promise to modernise Australian business registers and ensure that there is a modern, effective and efficient registration regime for businesses into the future.

Senator WATT (Queensland) (09:52): I rise to speak in support of the Commonwealth Registers Bill 2019. In doing so I want to focus on one measure in particular, and that is the introduction of a director ID number, which will require company directors to provide proof of identification before registering companies. This is something that Labor and many industry and union groups have called for for some time, and I'm glad that finally we are seeing some action from the government on this point.

I've spoken a lot about this issue, both in this term and in the last term of parliament, because it has particular relevance to a number of regions in my state—in particular the Gold Coast and the Sunshine Coast where, unfortunately, for many, many years we have seen rampant phoenixing of companies, particularly in the construction industry but also in a number of other industries, including the security industry and contract cleaning. One of the things that I've said in talking about this issue in the past is that in the absence of a director ID number it's actually easier in Australia to register yourself as a director of a company than it is to register a dog. When you think about the responsibilities of company directors and the potential for ordinary people to be defrauded by rogue company directors, that is ridiculous. For a long time, we have needed to put in place much stricter restrictions around who can register a company and the ability to trace them. As I said, the issue of phoenixing is a rampant problem in my home state of Queensland, particularly on the Gold Coast and Sunshine Coast.

Just as a quick reminder: what we're talking about is the ability of company directors to rack up big debts, whether it be to suppliers who supply goods and services to them or to subcontractors who come and do work for them. The big developer or the big building company will get people to do the work, owe them some money then close down the company, strip the assets out of it in doing so and move those assets to a new company. Then the company director gets on with life but leaves a trail of destruction behind them in the form of suppliers and subcontractors who have provided services, probably incurred debts themselves in doing so, but remain unpaid. I've met many small, usually mum-and-dad businesses, particularly on the Gold Coast but also the Sunshine Coast, who have been forced to shoulder unsecured debt and have been left in the lurch by big construction companies who go bust without paying their bills, and I think it's particularly important that this step is being taken now because, in the current COVID-19 environment, tradies have got enough to worry about without wondering if they're actually going to get paid for their work.

The reality is that tradies, other subcontractors, security guards and contract cleaning employees are often owed money for long periods of time anyway. They should actually be getting paid sooner—and, of course, should actually be getting paid—rather than ripped off by phoenixing company directors. Now, phoenixing is a problem we're likely to see more of as, on this government's watch, we enter a recession, the first recession we've seen in Australia in nearly 30 years. Some experts are even linking an expected rise in phoenixing cases to exactly when federal government support is due to dry up in September when JobKeeper will end, the safe harbour laws will be removed, banking loans will be called in and the jobseeker additional payment will end. We face a fiscal cliff in September, when a range of support for businesses and individuals is due to dry up. That's exactly the time when we are likely to see more phoenixing activity by rogue directors who don't want to pay their bills, so putting this measure in place will go some way towards protecting people from being ripped off.

We're already, in fact, hearing reports of a number of businesses on the Gold Coast using coronavirus as an excuse not to pay their subcontractors. That is just not right and it's not fair, and that's why I and a number of other people on the Labor side of this parliament have been speaking up on behalf of those subcontractors for some time. I note that under the Queensland Minister for Housing and Public Works, Mick de Brenni, the Queensland government has taken significant steps to protect subcontractors and to make sure they get paid. We haven't seen enough action from this federal government up until now. There is much more to be done at the federal level but, credit where credit's due, I'm glad that they have eventually got around to introducing the director ID number that we've been calling for for a long time.

I will give just a couple of local examples. When a major Gold Coast based construction company, MJM Projects, folded in January it owed workers and subcontractors over $4 million, and they've been told they're not likely to see any of that money. On the Sunshine Coast, the latest high-profile building company collapse has left painters and plumbers trying to claw back massive bills—$150,000 in one case. This is money that they've been chasing for months anyway. Similarly, subbies and trade creditors were owed more than $3.6 million when another major builder, RiCon, entered administration in January. In the last month, we've seen more Queensland businesses come crashing down, including Bulkbuild, a building company which has worked on projects for some of Australia's leading organisations, which owes creditors about $1.6 million, most of it to subcontractors.

As I say, I've met in person with a number of subcontracting firms, often mum-and-dad businesses, that have been destroyed as a result of crooked corporate conduct, particularly phoenixing. I've met people who have literally lost their homes and lost their marriages because they've been left at the end of a queue, not protected by federal laws, when it comes to getting paid. So I certainly hope that the changes that are being introduced today—we've called for these changes to happen for a long time—will go some way to cracking down on those dodgy, illegal practices and protect hardworking people, who are not rich people, from being ripped off by larger, dishonest entities.

There is a lot more to be done at the federal level to tighten laws and enforce the laws that we do have to protect subcontractors from this kind of exploitation. I've asked about this issue in a number of estimates hearings, particularly with ASIC, and I have to say that I haven't been very impressed with the effort that they've put into this topic. I understand that they are a very stretched organisation and that there probably is an issue of resourcing that the government needs to look at. This is a massive problem. It amounts people being ripped off to the tune of billions of dollars over the course of a year, and ASIC has got to actually take this issue seriously and protect these smaller entities who are being ripped off far too often. There is more to do. We should be policing these issues more. We should be enforcing the laws more than we are. But, credit where credit is due. This proposal to introduce a director ID number is good, and that's why we will be supporting the bill.

Senator ROBERTS (Queensland) (10:00): As a servant to the people of Queensland and Australia, I support the Commonwealth Registers Bill 2019 and the associated package of amending legislation, with reservations. Firstly, there is a growing belief among our governing class that, in many areas, Australian federalism relies on shared endeavour. I do acknowledge that coordinated federalism—where each government works with the other yet retains total determination over, and exercise of, its own constitutional powers—needs some honing today. After all, the internet runs as a thread through our society and connects us all across state borders. Yet this most definitely does not mean transfer of power from the states to the federal government. I'm advocating generally the reverse: we need to send some powers back from the federal government to the state governments in accordance with our Constitution.

It is fundamental to our Constitution and it is common sense that the best service delivery occurs when the person making a decision is located closest to the people affected by that decision. That is obvious. That is the reverse of what has happened in our country since 1944. The greater the distance apart, the worse is the decision-making. We need to stop centralising and restore competitive federalism. Competitive federalism, with six states working independently yet together, is highly effective. Our country was leading the world in per capita income from 1901, when we formed as a nation, until about the 1920s, and that was because of competitive federalism. I reiterate that it is very important to get back to competitive federalism with the states working independently yet together.

My second point is that I am concerned that this bill will give the states the chance to wash their hands of responsibility for the integrity of the data in this register. I urge the federal government to ensure that, when this register is designed, there is suitable, effective grievance reporting, so that where a person's entry contains an error or where a person has been mistaken for someone else, they can correct the record. Australians recently saw firsthand a total failure of the federal government's IT function with the chaotic, tragic robodebt scheme. And it's not just a matter of the government making an apology. It's not just a matter of there being an error of close to a billion dollars. It's a matter of wrecking people's lives. It's important to understand that the government never pays for its mistakes: the people do. What I mean by that is the people pay twice—once for what the government did through our taxation system and then through their own hip pockets for the consequences of the government's error. We can see that in relation to the ban on live cattle exports that the Gillard government capriciously put in place. We now see the federal government lining up to take over business registrations, and people know that outsourcing the IT function did not turn out so well for the government last time.

Thirdly, I am concerned that this bill is not about making a better system for controlling business registrations and keeping track of company directors. I am concerned that the government has spotted another chance to sling yet more taxpayers' money at one of their corporate backers. Who will it be? KPMG? Indue? We can hardly wait to find out, but we will be watching.

All parties to this register must show the respect that is required for the Australians whose livelihoods, whose legal liabilities, are bound to this register. Please, Minister, take your time and get it right. Remember our constitution and competitive federalism. Care about the people you are serving. The government must do better this time because after all government is here by permission of the people on behalf of the people to serve the people. That service from government must be in accordance with our people's governing document, our national Constitution.

Senator SCARR (Queensland) (10:05): I'm delighted to rise in this place to speak in favour of the Commonwealth Registers Bill 2019. Before I launch into some of my contributions in this debate, I'd just like to acknowledge some of the contributions of Senator Roberts from my home state of Queensland. Can I say to you, Senator, I, through the Acting Deputy President, agree wholeheartedly in terms of the need for this country to keep the spirit of competitive federalism, absolutely. I also agree that the people whose information is contained on any of these registers should have the right to rectify any mistakes in a clear procedure where they can make sure that there isn't information contained on these registers that is against their best interests.

But I do say to you: it is a good thing that we are consolidating some 35 registers under this regime and we don't have 35 registers being operated by each of the six states in this country. I think that would impose a great burden on Australian business. So I think we're moving in the right direction with this legislation. I really do. That is reflected in the context of these amendments. The Australian government has committed to simplifying its interactions with business to support growth, innovation and employment to make it easier for people to do business in this country, not harder.

The National Business Simplification Initiative announced in 2016 aims to reduce the time that business spends complying with regulations and interacting with governments so they can focus on growing their business, creating more jobs and developing new products. This nation needs to have a laser-like focus on the creation of new jobs as we build this bridge through the pandemic to recovery. We need a laser-like focus on the creation of those new jobs.

This new law facilitates that by setting up a modern government registry regime that is flexible, technology neutral and governance neutral. The regime initially applies to the businesses administered by ASIC and the Australian Business Register. If you needed any reason to know why this legislation is required, all you need to do is to look at the list of registers that are covered by this legislation—the Australian Business Register, the ACN register, the business names register, the Australian registrable bodies register, the Australian registrable bodies and foreign companies register, the reserved names register, the managed investment scheme register, the company charges register et cetera, et cetera; 35 of them. You can see why there's a need for legislation such as this.

I would like to place on the record my appreciation certainly to all those members of agencies and departments who've been involved in this consolidation project. There are actually 49 pages of consequential amendments arising from this legislation, 49 pages of different sections of legislation that are being amended to put this legislation in effect. That constitutes a great workload which has been conducted and delivered by the servants of this nation who work for the good of this country. I really do congratulate each and every one of them for being involved in that project.

As well as the consolidation of the governance of these 35 disparate registers, another important aspect of this legislation is the Director Identification Number. This is something that was proposed in the 2015 Productivity Commission report entitled Business Set-up, Transfer and Closure. That report referred to the fact that, as my friend Senator Watt from Queensland referred to, the issue of phoenixing is one which impacts Australians all across the country. I know that this has been the subject of different Senate committees and inquiries—and my friend Senator Whish-Wilson has been involved in many of those inquiries. And I congratulate all the senators who have been involved in those inquiries and made those recommendations. I've been listening to your contributions to this debate.

Illegal phoenixing is a scourge—and absolute scourge. It impacts on small businesses, employees and taxpayers, because every action of illegal phoenixing, which means that employees aren't paid what they're entitled to, means the federal government has to stump up and do what the owners of those companies should have done to meet those employee entitlements under the Fair Entitlements Guarantee scheme. This is an important plank in building our response to illegal phoenixing, but this government has taken action in order to combat illegal phoenixing.

Under the Treasury Laws Amendment (Combating Illegal Phoenixing) Act 2020, which I spoke for, new phoenixing offences were introduced. There was a prohibition of backdating resignations or leaving companies directorless, which was a key component of the illegal phoenixing strategy. I think it was quite unfair for my friend Senator McAllister to yesterday criticise the federal government for not taking action, because the record is that the government has been taking action over the last several years. That also includes the establishment of an ATO taskforce set up to combat illegal phoenixing.

With respect to the director identification number provisions contained in the bill, each director must have a specific number—a unique identifier. That director identification number will follow that director, and the regulators, administrators and liquidators will be able to follow whether or not a director repeatedly keeps turning up as a director of companies. I want to draw out how effective this could be in the context of illegal phoenixing activity. There was an example given in the Productivity Commission's report in 2015 of a labour higher business which had negligible assets and a turnover of $30 million per annum which fragmented its operations across 53 related companies. It lodged accurate BASS statements for all the companies but failed to remit the required amounts under the PAYG system. The single company director—one director across 53 different companies—then liquidated every one of those 53 companies within a week and moved his workforce of 2,700. This wasn't just a small one-off commercial establishment. There were 2,700 employees. He moved his whole workforce of 2,700 into eight new entities—eight new companies—and continued trading. He has since fled Australia. Over $8 million in taxes remain unpaid and this labour hire business was still trading and failing to comply with its obligations at the time that the Productivity Commission actually delivered its report. I think that is a great example of how a director identification number could be used to combat that sort of behaviour.

How? This bill contains a number of offences and civil penalties in relation to the director identification number. First, the obligation is that you actually apply for a director identification number, if directed by the registrar. The maximum penalty for not doing so is 60 penalty units under criminal law or a civil penalty unit greater than 5,000 penalty units or three times the benefit derived or detriment avoided because of the contravention. So there is both a criminal element and a civil element to the penalty, and that is absolutely appropriate.

The rogue—the ratbag, whatever we want to call him—who set up those 53 companies and then liquidated them and moved to the other eight companies, would have been required to apply for his director identification number before he set up even his first company. When he set up the second, he would have had to apply the same director identification number. If our rogue wanted to apply for an additional director identification number, that would be an offence under this legislation. If our rogue wanted to misrepresent a director identification number, that would also be an offence under this legislation. If someone acted as an accessory to help him in establishing this convoluted scheme—and, based on my experience, it's difficult to set up 53 companies or, in this case, 61 companies, without the assistance of some people—then they would have also committed a contravention under this legislation.

So, as Senator Whish-Wilson referred to yesterday, we have to move away from a situation where we have directors with names such as Elvis Presley and Bob Marley. I wish some of these great performers of the past could return to the stage of today rather than the stage in the sky—I truly do. They are some of my favourite performers. I wish they could reappear in today's society. Absolutely. I listen to their works quite often. It would be laughable if it weren't so serious. It really would. As Senator Watt said, it is easier to become a director and be registered in this country than it is to register a dog or to get a library card or to rent a DVD, if anyone does that any more. I'm not sure they do. I'm showing my age! It's harder to do all of those things than it is to actually become a director and take on all those responsibilities under the Corporations Act.

We're talking here not just of fictitious directors, people who don't exist, but also vulnerable people who are persuaded, by whatever means, to become directors of companies. The fact that there will be a verification and authentication process in this regard will make it harder for the rogues who are out there to use their manipulative techniques to convince people to expose themselves by becoming directors. That is a really important part of the scheme.

So I'm extremely pleased to have the opportunity to speak in favour of this bill. I have heard and reflected on some of the comments that have been made about the time it has taken for this legislation to be considered in this place. It gave me cause to reflect on the fact that Minister Hunt as Minister for Health has often alluded to the fact that we've introduced the telehealth scheme, which we thought would take 10 years, in 10 days. Maybe we should look for other opportunities where we can expedite the introduction of legislation to deal with a whole range of matters that are in the best interests of the Australian community.

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (10:17): Firstly, I would like to thank those senators who have contributed to this debate. Schedule 1 of the Treasury Laws Amendment (Registries Modernisation and Other Measures) Bill 2019 will provide the legislative flexibility for the government to modernise Australia's business registers onto a single platform to be administered by the Australian Business Register, within the Australian Taxation Office. Modernising the business registers will address registry fragmentation, improve business user experience, reduce risks of ongoing operating, foster data-driven innovation and enable better use of registry data.

The IT infrastructure underpinning Australia's business registry services has been found wanting and needs to be upgraded to meet current and future demands. To facilitate the implementation of a new registry system, a legislative package has been drafted that is flexible, technology-neutral and governance-neutral. The Modernising Business Registers legislative regime will allow a registrar, a Commonwealth body appointed by the minister, to create data standards and disclose frameworks to assist them in carrying out the registry functions and powers. The data standards will allow the registrar the flexibility to determine what information will be collected, how the information will be collected and the manner in which the information will be maintained. This flexible approach will ensure that the registrar can utilise the latest technology and practices.

Director identification numbers are being progressed as part of the Modernising Business Registers program. Schedule 2 of the Treasury Laws Amendment (Registries Modernisation and Other Measures) Bill 2019 provides for the introduction of a legal framework for director identification numbers which will require all directors, and alternate directors, of registered bodies to have a unique identifier. Administrative details, such as how to apply for a director identification number, will be determined by the registrar, or the registrars, appointed by the minister in due course. Importantly, once a director has been issued with a director identification number, that unique number will remain with them forever, meaning their directorships across companies and over time can be easily tracked. This will assist regulators and external administrators to investigate a director's involvement in what may be unlawful activity, including illegal phoenix activity, which has been a perennial problem for successive governments.

Director IDs are being progressed as part of the Modernising Business Registers program for two key reasons: First, doing so ensures that the director ID is integrated with other important registry data. This will provide greater insights to regulators, to businesses and to individuals on the identity and affiliations of directors. Having all business registry data linked will help with risk profiling and to combat illegal phoenixing. Second, ASIC's registers are ageing and outdated. Adding large amounts of functionality to registers that will soon be replaced will be very costly, likely increase the instability of ASIC's systems and also offer limited anti-illegal-phoenixing benefits. Moreover, ASIC does not have an identity verification progress. Progressing director IDs as part of the Modernising Business Registers program will also allow Director IDs to use the most advanced identity verification processes.

The Modernising Business Registers program will be delivered iteratively over a number of years. However, director IDs will be one of the earliest deliverables on the new, modernised platform. The government will closely monitor the effectiveness and progress of the entire program on an ongoing basis. I commend this bill to the Senate.

Question agreed to.

Bills read a second time.

The ACTING DEPUTY PRESIDENT ( Senator Gallacher ) (10:22): As no amendments to the bills have been circulated, I shall call the minister to move the third reading unless any senator requires that the bills be considered in Committee of the Whole.

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (10:22): I move:

That these bills be now read a third time.

Question agreed to.

Bills read a third time.

Senator McALLISTER (New South Wales) (10:23): I rise to speak to the Treasury Laws Amendment (2019 Measures No. 3) Bill 2019. Labor will be supporting this bill. There are three schedules to the bill and in turn these address matters relating to testamentary trusts, deferral of education and training standards for existing advisers and making miscellaneous amendments as part of the routine process of updating provisions and correcting errors.

Schedule 1 to the bill implements a 2018-19 budget measure and closes a loophole that allows testamentary trusts of deceased estates to be used for tax evasion purposes. It is designed to ensure the tax concessions available to minors in relation to income from a testamentary trust only apply in respect of income generated from assets of the deceased estate that are transferred to the testamentary trust or the proceeds of the disposal or investment of those assets. In effect, the law as it stands means that testamentary trusts can be used as a vehicle to minimise tax because income other than that resulting from a diseased estate can be transferred into them. Under present circumstances, the income minors receive from testamentary trusts is taxed at adult marginal rates, which access the $18,200 tax-free threshold. Some taxpayers, therefore, are able to appropriately obtain the benefits of this lower tax rate by injecting assets unrelated to the deceased estate into the testamentary trust. The government wants to close the loophole, and we fully support it.

The effect of schedule 1 is that income from testamentary trusts will be limited to income derived from the assets that are transferred from deceased estates or the proceeds of the disposal or the investment of those assets, and this is appropriate. But nobody should be under any illusion that this is a substantial reform. As the 2018-19 budget said, 'The measure was estimated to have a small, unquantifiable gain to revenue over the forward estimates period.' We shouldn't count on this measure to direct rivers of gold into the Treasury any time soon. And if the government wants to be taken seriously, and this is a very big if, then it should bring serious proposals in relation to tax avoidance into this chamber.

Schedule 2 to the bill amends the Corporations Act to defer the transitional time frames for existing providers to comply with the education and training standards, requiring completion of an approved degree or equivalent qualification and the standard requiring the passing of an approved exam. The transitional time frame for the approved degree or equivalent qualification will be deferred by two years to 1 January 2026. The transitional time frame for the approved exam will be deferred by one year to 1 January 2022. These are unfortunate but necessary amendments. They arise from the government's mishandling of the professional standards for financial adviser reforms.

In March 2017 reforms were introduced into the Corporations Act by the Corporations Amendment (Professional Standards of Financial Advisers) Act to raise the education, training and ethical standards of financial advisers. These reforms passed the parliament with bipartisan support over three years ago. They set new standards for financial advisers. They were intended to progressively come into effect from 1 January 2019. However, the body appointed by the government, the Financial Adviser Standards and Ethics Authority, was extremely slow to set the standards. As a result, financial advisers have been placed in the very difficult position of being asked to comply with the standards and complete exams at incredibly short notice. The government's decision to defer the educational and exam requirements is now appropriate but it should have been entirely unnecessary. It is only the result, and exclusively the result, of the implementation failures of the government.

Regrettably, we are in a position where we support a deferral to the deadlines. We understand that it is necessary. But when the parliament passes legislation it has every expectation that it will be implemented by the executive within the time frames in the legislation. It is a terrible failing by this government, a failure that has placed impossible pressures on financial advisers to comply with the new standards and sees the Senate placed in this position.

Schedule 3 of the bill makes a number of minor and technical amendments to laws relating to taxation, superannuation, corporations and credit. These amendments correct typographical and numbering errors. They bring provisions into line with modern drafting conventions, they repeal inoperative divisions, they remove administrative inefficiencies, they address unintended outcomes and they update references. Essentially, they help Treasury laws improve to operate as intended. And they were recommended by the 2008 Tax Design Review Panel.

This legislation contains necessary changes. It implements a long delayed budget measure to close a small tax loophole. It defers a previously legislated time frame that has not been met and it makes minor revisions to various laws through a process recommended by the 2008 Tax Design Review Panel. All these things are necessary. Some of these things could have been avoided.

We will always support sensible legislation that assures the efficient and effective operation of our taxation, financial services and corporate law systems, but the changes made in this bill should have been made much sooner. We condemn the government for its tardiness, it lack of attention and its failures in implementation.

Before I conclude, I wish to advise the chamber about the amendments that Labor circulated to this bill in May. I inform the chamber that Labor will now withdraw these amendments on sheet 8891 and we will not be moving them in the committee of the whole.

In the House of Representatives, Labor proposed amendments to this bill to remove the legislative exemption from conflicted remuneration rules for financial advisers in relation to the selling of units or shares in listed investment trusts and listed investment companies. Labor first introduced a ban on conflicted remuneration in 2012. But in 2014 this government introduced a loophole for listed investment vehicles and that enabled billions of dollars' worth of shares in units to be sold on the basis of commissions, costing mum and dad investors millions. As the shadow minister for financial services, Mr Jones, has said, ordinary investors were left exposed to complex, opaque and underperforming products because of this dud legislation.

Labor has been putting pressure on the government to remove this loophole for nearly a year. We have proposed moving these same amendments in the Senate, but we acknowledge that the Treasurer has finally come to the table. The Treasurer has committed to remove the conflicted remuneration exemptions for listed investment and listed investment trusts. Last week, he issued draft regulations to that effect for consultation. So today we are withdrawing our amendments in good faith. But if the final regulations are not up to scratch, are not issued in a timely manner or don't adequately protect ordinary Australian investors then we will be returning to the parliament to address this issue again.

Labor gives credit to the government for acting on this important issue, but this is a commonsense decision and it should have been arrived at far earlier. I thank the Senate.

Senator PATRICK (South Australia) (10:30): I rise to speak in support of the Treasury Laws Amendment (2019 Measures No. 3) Bill 2019. Centre Alliance fully supports the provisions in the bill. I won't repeat the purpose of the bill—Senator McAllister has done a fantastic job articulating what the bill seeks to achieve. However, I will be moving an amendment in the committee stage and I just want to talk about that amendment now.

My amendment will rid the Federal Register of Legislation of a perverse provision in the Corporations Act which exempts some large proprietary companies from having to lodge financial reports. That includes financial statements and directors' declarations to ASIC. This is highly problematic for a couple of reasons. Firstly, it inappropriately leaves in place an elite or privileged class of companies that do not have to lodge ASIC reports. If my amendment passes then that inequity will no longer continue. We cannot have a legislative privilege in Australia—in an Australia which does not take kindly to these sorts of privileges.

Secondly, the opaqueness created by not filing accounts with ASIC creates an environment that may well encourage the aggressive tax minimisation behaviour that the government says it is trying to combat. I would also add that when an entity wants to have dealings with a company, one of the things they do is go to ASIC and seek information about the company which may help them to make decisions about whether or not they want to trade or deal with that particular company. That is not possible for these companies.

The exempt proprietary company list was created in 1995 as a temporary measure.

Senator Whish-Wilson: It was Paul Keating.

Senator PATRICK: Okay—it was Paul Keating. That's correct, Senator Whish-Wilson. At the time there were more than 1,500 companies that were on the list. When the bill passed through the Senate in 1995, the then Senator Michael Baume, AO—a Liberal senator—moved an amendment, and I'll read the amendment:

At the end of the motion, add:

"and the Senate resolves that not later than two years and six months after the commencement of the amendments set out in items 1 to 6 of Schedule 4 of the bill, the Australian Securities Commission is to cause to be laid on the table a review of the first two years of the operation of those amendments".

Do you know what? So far as I can tell that review never took place, despite the Senate commanding that it should. I asked at estimates whether or not ASIC could find evidence of a review, and nothing came back in relation to that. So we can comfortably assume that the review did not take place.

The Senate Economics Committee conducted an inquiry into multinational tax avoidance across both the 44th and 45th Parliaments. One of the submissions it received, submission No. 32, was from ASIC, who raised the concern about these exempted companies. That led the Senate economics committee to ultimately recommend:

… that the government require all companies, trusts and other financial entities with income above a certain amount to lodge general purpose financial statements with the Australian Securities and Investments Commission.

My amendment will implement the recommendation—which was, in effect, initiated by ASIC—that was made to the Senate.

There is no reasonable excuse—I repeat: there is no reasonable excuse—for the coalition not supporting this amendment. I put the question to the minister in the last estimates about the government's response to this Senate report, and—noting it was a 2015 report—I got the answer: 'The government is still considering its response to the Corporate tax avoidance, Part III, Much heat, little light so far report. The government will respond in due course'. I'm sorry; that is not good enough.

In practical terms, my amendment removes the special status of these exempt companies. Currently, there are 1,119 exempt companies, owned by some very familiar names—names that the Liberal Party will know very, very well. They will have to lodge financial reports with ASIC going forward. They'll be subject to the same scrutiny as everybody else. Colloquially, the current situation doesn't pass the pub test, and, indeed, this elitism would be banned from even entering the pub.

Senator BILYK (Tasmania) (10:36): The Treasury Laws Amendment (2019 Measures No. 3) Bill 2019 is an omnibus bill that makes a number of minor changes relating to taxation, superannuation, corporations and credit. One of the key provisions in the bill is to change the tax concessions available to minors from a testimony trust.

The measure in the bill I would like to focus my attention on in this second reading speech is an amendment to the Corporations Act which defers the education and training standards for existing financial advisers. The transitional time frames for an approved degree or equivalent qualification will be deferred by two years to 1 January 2026, and the transitional time frame for the passing of an approved exam will be deferred by one year to 1 January 2022. In a nutshell, this is the deferral of the implementation of the Financial Adviser Standards and Ethics Authority, or FASEA, reforms. Labor has offered bipartisan support for these reforms, and we also support this amendment, but the deferral of the FASEA reforms is only necessary because of the absolute shambles this government has made of them. It's almost 11 years since the parliamentary inquiry into financial products and services handed down its report, eight years since the Future of Financial Advice, or FOFA reforms, five years since the government's announcement of the FASEA reforms, three years since the establishment of the authority, and 18 months since the new requirements commenced. The government has had plenty of time to get this right, yet their revolving door of leaders, finance ministers, treasurers and assistant treasurers hasn't helped the process. Neither has FASEA going through three different CEOs in the first 18 months.

The incompetence and failures in the implementation of these reforms have led to ongoing delays, which have had a detrimental impact on both financial advisors and their customers. For customers, it means that they remain at the mercy of those few financial advisers who are acting unethically and failing to represent their clients' interests first. For financial advisers, the overwhelming majority of whom are acting professionally and ethically, it has led to frustration and uncertainty about their future in the profession.

There has been a lack of consultation around the reforms and the feedback that has been received has resulted in barely any changes. Professional standards were released only days before they were due to come into effect. We heard in the House of Representatives second reading debate on this bill of concerns raised by some financial advisers that almost every financial adviser in Australia would be in breach of the standards because of FASEA's delay in releasing their final guidance. Remember that it was as late as mid-October last year when the Treasurer announced in a media release that a code of ethics would be released and all financial advisers would be required to adhere to it by 1 January 2020. It was even later—mid-November—when the Australian Securities and Investments Commission assured advisers that they would not be in breach of the law because they were unable to register with an ASIC-approved compliance scheme by 1 January 2020.

In recent months much of the anger and frustration has arisen from the exam that financial advisers have been required to pass by January 2021. I've had numerous representations in my office about this issue. Six months of exam preparation time was lost to financial advisers because of the delays in FASEA releasing exam guidance. When the guidance was finally released, it was very vague and gave limited information to financial advisers about what topics would be examined and how they should prepare for the exam. The first exam was held entirely in metropolitan areas, which made it difficult for many advisers to attend.

One of the key problems that have been raised with me by financial advisers in relation to the exam is the lack of feedback on exam performance. This is particularly frustrating for those advisers who have failed and need to study again to re-sit the exam. The exam covers three domains of knowledge—specifically: financial advice regulatory and legal obligations; applied ethical and professional reasoning and communication; and financial advice construction. For candidates who have failed an exam, the statement of results highlights the broad domain knowledge areas they need to focus on. This high-level feedback is very unhelpful in helping candidates know what topics they need to study. Of the 470 advisers who sat the April exam, around 16 or 17 per cent were sitting it for the second time, according to a report by the publication Professional Planner. Only 50 per cent of those advisers sitting the exam for the second time passed. For those advisers who have failed the exam twice it must be incredibly frustrating not only to have to sit the exam a third time but to be given almost no clues as to why they have failed.

I'll give you an idea of why they are so frustrated. It costs close to $600 to sit the exam each time and sittings are available only every two to three months. To add further uncertainty, it takes around six to eight weeks after the exam to get the results. This means that a financial adviser who has failed twice may have spent around six months trying to pass the exam, paid $1,200 in sitting fees and taken many hours out from doing work for their clients to prepare for the exam. After all that, they've got nothing to show for it. They still have no guarantee that investing time in further study will allow them to keep working in their industry—an industry that some have been in for decades. It's hard to imagine the anxiety that some financial advisers must be experiencing when they have a black cloud like this hanging over their future in their profession and no clear answers about what they need to do to clear it up.

For an industry which in the past has faced a number of scandals involving conflicted remuneration, from which many Australians have suffered, it's not unreasonable to require that its practitioners adhere to professional standards. It brings financial planning into line with a number of professions with similar requirements—medical practitioners, lawyers and accountants, to name a few. I say it's not unreasonable, but the Morrison government have made the requirements unreasonable through their poor handling of this reform. They have expected financial advisers to pass an exam in an environment where the standards and exam guidance were released late, the exam guidance and feedback are vague, and the first exam sittings were difficult to access. They have, once again, completely bungled what should have been a straightforward reform.

Labor has amendments to this bill that will remove the exemption from conflicted remuneration rules for financial advisers in relation to selling of units or shares in listed investment trusts and listed investment companies. This exemption was part of the Liberals' winding back of Labor's FOFA reforms. Since 2015 the market for listed investment companies and listed investment trusts has doubled to $45 billion, yet these products have performed very poorly, with an average return since 2015 of minus 6.1 per cent. There is absolutely no reason to keep the exemptions for LICs and LITs, and ASIC agrees. ASIC supported Labor's position when they told TheAustralian Financial Review almost one year ago:

Conflicted remuneration in financial services should be prohibited or removed as a general policy.

The banking royal commission also recommended considering the remaining exemptions to the ban on conflicted remunerations and whether each one remains justified. I can't see how the exemption for LICs and LITs remains justified when they are underperforming and advisers are earning commissions of between one and three per cent on them. The winding back by those opposite of Labor's FOFA reforms was a backwards step and one for which investors continue to suffer by being encouraged to invest against their own interests in high-risk and poorly-performing products. I'm disappointed that the government has chosen to play politics with Labor's amendment sand to blame our amendments on its own decisions to delay this bill.

In an 11 May article in Professional Planner Senator Hume described our amendments as a backflip and as having been moved at the eleventh hour. It is neither, and those opposite know it and should stop misleading the industry. Yes, the amendments were redrawn in the House and, yes, they were reintroduced in the Senate, but since the amendments were first moved in February we have made it abundantly clear to the government that they will remain on the agenda. I'll happily agree with the government that industry has a right to be angry about this delay, but any anger it expresses should be directed squarely at government. Given the anger that's already been directed at the government by the financial services industry for their mismanagement of the FASEA reforms, it is of little surprise that the government have tried to deflect some of the anger towards us, even if they had to reinvent history to do so.

Rather than play political games, the government should be directing their energy towards giving the industry certainty. I'm sure a competent government would be capable of making improvements to the exam process that satisfactorily addresses the concerns of the industry without diminishing the quality of ethical standards that the exam is designed to uphold. When this bill passes, those opposite need to own up to their mistakes and dedicate the additional time parliament has given them to getting this reform right. This will need further discussions with financial advisers to understand the concerns they have and the barriers they are facing in completing and passing the exam.

What we are not hearing from this government in its contributions on this bill or any other public forum is an apology to all those financial advisers who've been thrown into turmoil by its mishandling of these reforms. No-one in the government has the honesty or the guts to fess up and say, 'Yes, we stuffed this up; we got it wrong and we're sorry.' The extension provided by this bill is a tactical admission of the monumental mess the Morrison government has made of these reforms. If they are going to admit by their deeds that they got this so badly wrong, why not have the courage to follow that with an admission in words as well. How can financial advisers and their clients have any faith that those opposite are truly committed to fixing this mess if they can't admit to making the mess in the first place? This is the Liberal Party, the party which claims to encourage enterprise, which claims to stand up for and look after small business, yet it has failed thousands of small businesses in this sector so dismally. This is supposedly the party that is so committed to deregulation and to reducing red tape, for which we had to sit and listen to lectures on regulation when it introduced its ridiculous omnibus repeal bill. We listened to lectures on red tape while they introduced bills which removed out-of-date legislation and corrected punctuation delivering absolutely zero benefit for business. This massive debacle and the distress it caused financial advisers clearly shows that the Liberal small business advocacy and red tape reduction credentials are non-existent.

Of course, the absolute mess they've made of an important reform for the financial services sector adds to a ton of evidence against the ridiculous myth that those opposite are superior economic managers. Given their recent $60 billion JobKeeper blunder, the robodebt debacle and the sports rorts scandal, I'm surprised that any Australian would trust them to run a chook raffle, let alone the country. But, hopefully, with another year's grace, the government will have enough time to clean up the mess they've made of FASEA. Let's hope these reforms can still be salvaged, because, when it comes to accountability in the financial services sector, Australians have very little faith in the government that voted 26 times against the banking royal commission and dragged its feet for years on payday lending.

Labor remains 100 per cent behind the establishment of FASEA and the requirements for financial advisers to meet educational standards, to pass a professional exam, to have professional experience and to meet continuing professional development requirements. We know from evidence given to the banking royal commission and other previous inquiries that, sadly, a minority of financial advisers put their own interests ahead of those of their clients, and we also know that investors suffer as a result. But it is important to acknowledge that the majority of financial advisers do act with high ethical standards and look after the interests of their clients.

The incompetent hand that this government has made of the implementation of the FASEA reforms has two groups of victims: financial advisers who do the right thing, who act ethically and who look after their clients; and the customers of those financial advisers who don't. So I hope, for the sake of all those affected, that, with the passage of this bill, the Morrison government can fix their mistakes and get this reform right. I commend the bill to the Senate, and I urge the government and the crossbench to make sure this bill goes through.

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (10:51): First I would like to thank those senators who have contributed to this debate. This bill contains a number of measures which improve the integrity of the tax system, provide flexibility in completing new financial adviser requirements and ensure existing legislation operates as intended.

Schedule 1 amends the Income Tax Assessment Act 1936 to limit the tax concessions available to minors in relation to income from a testamentary trust in respect of income derived from assets transferred from the deceased estate or subsequently accumulated from those assets. This is an integrity measure to improve the taxation of testamentary trusts. It was announced in the 2018-19 budget and applies from 1 July 2019.

Schedule 2 extends transitional deadlines for existing advisers to ensure that they have enough time to meet new professional requirements. Existing advisers will be required to complete the exam set by the Financial Adviser Standards and Ethics Authority by 1 January 2022; this is one additional year. In addition, advisers will be required to meet the qualification requirements by 1 January 2026; this is two additional years. The government is committed to raising education and training standards of financial advisers. This includes new entrants and existing advisers.

Schedule 3 makes minor technical and machinery amendments to the Treasury portfolio legislation. This includes amendments to address technical deficiencies, to ensure the law operates as intended in the Treasury portfolio legislation and to remove administrative inefficiencies. I commend this bill to the Senate.

Question agreed to.

Bill read a second time.

Senator PATRICK (South Australia) (10:53): by leave—I move Centre Alliance amendments (1) and (2) on sheet 8968:

(1) Clause 2, page 2 (at the end of the table), add:

(2) Page 71 (after line 3), at the end of the Bill, add:

Schedule 4—Financial reporting obligations for large proprietary companies

Part 1—Repeal of instrument

ASIC Corporations (Exempt Proprietary Companies) Instrument 2015/840

1 The whole of the instrument

Repeal the instrument.

Part 2—Grandfathered exemption

Corporations Act 2001

2 Subsection 1408(6) (table item 7)

Repeal the table item.

Part 3—Application

3 Application

(1) This item applies to a company if, immediately before the commencement of this item, the company was exempted from complying with subsection 319(1) of the Corporations Act 2001 by the ASIC Corporations (Exempt Proprietary Companies) Instrument 2015/840.

(2) Despite the amendments made by Parts 1 and 2, that exemption continues to apply to the company in relation to the 2019‑20 financial year.

4 Instruments that provide relief from requirements of Corporations Act—Lodgment of annual reports by large proprietary companies

(1) Despite anything contained in the Corporations Act 2001, ASIC may not make a legislative instrument, however described, if that legislative instrument would have the effect of relieving the class of companies referred to in subitem (2) of the requirement to comply with subsection 319(1) of the Act for a financial year.

(2) The class of companies is the class of large proprietary companies that was relieved from the requirement to comply with subsection 319(1) of the Corporations Act 2001 due to the operation of the ASIC Corporations (Exempt Proprietary Companies) Instrument 2015/840 as in force immediately before the commencement of this Schedule.

I spoke about amendment (2) in my second reading contribution. It seeks to eliminate a privileged list of companies that do not have to lodge financial reports with ASIC. I understand that I will have the support of Labor, One Nation, the Greens and the Jacqui Lambie Network, which means it will pass. I understand that the government will not be supporting this amendment.

In that context, I just want to take the chamber to an article that was written by TheGuardian data journalist, Nick Evershed, back in 2015, when this was very topical. He basically compared the grandfathered list against the Australian Electoral Commission's donation records covering 1998 to 2014 and government contracts from AusTender covering 2007 to 2014. What he found was that 132 had given money to either the Labor Party or the Liberal Party or one of their associates, and 133 of the companies still on the list had held government contracts worth a total of $2.3 billion. I'm happy to say that that's not stopping Labor from supporting this. They get it. This is a very, very unfair arrangement where select people, well-known business people, are exempt from the requirements that apply to every other large proprietary company in lodging returns to ASIC. I just hope that is not the basis of the government's rejection of this amendment, and I look forward to hearing what the minister has to say.

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (10:56): Thank you, Senator Patrick. The government's position is to oppose Senator Patrick's amendment. The issue raised by the senator's proposed amendment is the subject of a recommendation in the Senate economics committee's report Corporate tax avoidance part 1: you cannot tax what you cannot see, which I know the senator has referred to before. The government will respond to this recommendation as part of its response to the Senate economics committee's corporate tax avoidance reports.

Senator McALLISTER (New South Wales) (10:56): Labor will be supporting this amendment, as Senator Patrick has already indicated. This is an old regime. It's a regime that was put in place in 1995, and it provides very significant exemptions for a narrow set of companies. Companies on this list are owned by some of the wealthiest Australians. You can't even get off the list, I understand; those who've tried to take themselves off the list including, I think, former Prime Minister Turnbull, were unable to do so.

This is a sensible amendment. It's an amendment that, as the minister has noted, was canvassed in the Senate committee's work around corporate tax avoidance. The private companies that are on this list—very rich and very powerful people—are benefiting from an unfair grandfathering regime. As the title of the Senate report indicates, 'you cannot tax what you cannot see.' Why should these people be removed of their obligations to report transparently in the way that other companies do? Newer companies—and when I say 'newer', I mean companies founded since 1995—have to comply with very sensible ordinary ASIC requirements. While there may have been genuine policy reasons in the past for this exemption, the time for this exemption is over. If the Liberals, as they've indicated, won't back this amendment, then they need to explain to the public why it is that they are standing up for a special privileges regime that benefits the old, the wealthy and the very, very powerful.

Senator WHISH-WILSON (Tasmania) (10:58): The Greens will of course be supporting this amendment today. We moved a very similar amendment in 2018—in fact, almost identical to this amendment—with, I note, the support of Labor. We have long fought for tax transparency in Australia. In his contribution, Senator Patrick talked about the groundbreaking Senate inquiry that, I'm very proud to say, many of us in this chamber contributed to. It was initiated by my previous colleague, the Leader of the Greens, Senator Christine Milne, after being lobbied by the Tax Justice Network, Micah Challenge and a number of stakeholders at the time, going back to 2013. When people knock on our door and say, 'Can we come and see you and talk about an issue?'—and these were community groups and church groups saying, 'What can we do about tax justice?'—I often say to them, 'Look at that as an example of how you can achieve something when you come to this place and you sit down with your elected representatives.' Senator Milne initiated that inquiry. It ran for a number of years and it made some very significant recommendations for reform. Recommendation 13 in that reform was to get rid of this grandfathering amendment. I'm very proud, as a chamber, that we achieved a fantastic Senate report taking witness evidence right around the country from hundreds of stakeholders. Not all of it's been legislated, sadly, but a lot of it has. I'm very pleased that Senator Patrick has brought this back today.

It's no coincidence that, looking at the numbers in that Guardian report, some have expired—about 1,498 private companies back in 2015 were exempted from providing a full set of financial accounts to ASIC. I'm not sure what the policy reasons were that Senator McAllister was referring to that may have been legitimate at the time. I can't see any at all, except perhaps there was an impasse around legislation. However, transparency should be in our genes. There should be no reason at all that any company gets preferential treatment. Looking at the current numbers, I don't think it's any coincidence that nearly 10 per cent of these companies are donors to the Liberal Party. Nearly 10 per cent have contracts, and of course the Liberal Party has a lot of explaining to do if they don't vote for this today.

More importantly, since 2018, this chamber has had the appetite to pass this amendment to any piece of legislation as was evidenced when the Greens did this with Labor back in 2018. The appetite for transparency, however, I don't believe is as strong in that other place down the corridor through that door. We're about to find out when this amendment passes today whether the Liberal Party is going to finally turn its back on this outdated, totally unjustified exemption for some of the biggest and wealthiest companies, and families and individuals, in this country to not provide full details of their financial affairs to the regulator.

Making these things public is absolutely critical. There is a public good component to this—providing information. Luckily there are people out there who spend a lot of their time looking at the tax affairs of companies. Because it is all about social justice. It is all about paying your fair share. If you don't have the disclosure, you're never going to get the reform. The two things go hand in glove. So we're pleased, Senator Patrick, and thank you for acknowledging the role the Greens played when we did move a very similar amendment back in 2018. I hope, if we don't have success this time round, that we continue to plug away until we do. The Greens commend this amendment.

Senator ROBERTS (Queensland) (11:02): One Nation, too, will be supporting the Centre Alliance amendment. We acknowledge the office of Senator Rex Patrick in putting this forward and we thank them very much for doing so. It is yet another example of how the elites have their fingers into the two major parties. That needs to stop. We need to have a much more transparent system and we need to also have a much more transparent and fair taxation system. We need a comprehensive review of the whole taxation system, because there have been so many people butchering this since the 1940s and 1950s. Indeed, I go back to 1953, when the Prime Minister of the time, Robert Menzies, introduced the double taxation act that made it possible for foreign multinational companies to pay no company tax at all. That leaves a burden on Australians, Australian companies and Australian families.

I just come back to: the Labor Party on this occasion is supporting this amendment. The Greens are supporting it; and, Centre Alliance: a wonderful job on that. We don't need to say too much more about the details other than thank you very much, and we will be supporting your amendment.

Senator PATRICK (South Australia) (11:04): I have a couple of questions for the minister. Noting there are cuts across the public space, ASIC has provided a list of the 1,119 companies that still remain on the list—and I thank them for providing this in response to an answer to a question that I put to them at estimates. I'm just wondering if you could tell the chamber how many Liberal donors are on this list?

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (11:04): I have a copy of that list, too, Senator Patrick, so thank you very much for that. I'm not aware of whether there are any donors there or whether there aren't any donors there. Donations are of course a matter for the Liberal and National party organisations. And as Senator Patrick knows very well, donations are declared with the AEC in accordance with section 314AB(1) of the Commonwealth Electoral Act 1918. Political donations are openly and transparently disclosed, and the register is publicly available on the AEC website.

Senator PATRICK (South Australia) (11:05): Perhaps a couple of the big names that are involved here: Mr Anthony Pratt, Mr Kerry Stokes, Mr Bruce Gordon, the Myer family, Lindsay Fox and Ramsay Health Care. I just wonder whether maybe any of those are on the list of donors to the Liberal Party.

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (11:05): I can't personally confirm whether they are or whether they aren't, but what I can say is that the register is publicly available on the AEC website—that political donations are openly and transparently disclosed. In fact, for the senator's benefit, in case he doesn't have it in his back pocket, the specific web page is www.transparency.aec.gov.au.

Senator PATRICK (South Australia) (11:06): I just want to respond to a comment that was made by Senator Whish-Wilson, because I think people will be watching this. I know that there are not a lot of financial advisers looking at this, because my office has been bombarded by calls from people concerned that this amendment, when it passes, will in fact cause the bill to go back to the other place and then sit there, and nothing will happen to this bill. Now, firstly, I just want to make sure that all those financial advisers understand that this bill is being supported by the Senate and that it has an amendment to correct an anomaly that creates a privileged class of companies here in Australia, which is no longer acceptable to Australians. I will just foreshadow—just advise what I've indicated privately to other senators in the this chamber—that when the bill goes back to the House, if it sits there, every treasury bill that has the right constitutional hook will have this amendment put. And if you want to stop all the bills passing through the House, for the purposes of protecting your financial mates, then that's how this is going to play out. So, I urge that when it goes back to the House you do deal with it and deal with it in accordance with the public interest that I've talked about in my second reading contribution and that Senator Whish-Wilson talked about as well.

Senator WHISH-WILSON (Tasmania) (11:07): I have a genuine question: what is the public policy purpose of having these grandfathered exemptions?

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (11:08): This amendment is not part of the original bill; it's unrelated to the original bill, and it will be addressed as part of the government's response to the Senate Economics Committee report that was referred to earlier.

Senator WHISH-WILSON (Tasmania) (11:08): Minister, that report was a long time ago. I was on that committee with Senator Dastyari when the report was finally released. We're talking about many, many years. There's been no attempt to address it at all. But thank you for saying that you will address it. I'll take you at your word on that. But my question—and it's very important for you now to explain to the Senate and anyone who may be listening to this debate—is: in your understanding, please, what is the public policy purpose of having grandfathered exemptions that were in place in 1995 and were designed to be temporary, as Senator Patrick outlined? Indeed, it was Mr John Howard who kept them in place deliberately, as a policy decision. So, it's your government that kept them in place. Can you explain to the Senate the policy purpose of having those exemptions and why you believe they should stay in place and why you're going to vote against them today?

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (11:09): I think those issues will be adequately addressed when the government responds to the Senate Economics Committee's report.

Senator WHISH-WILSON (Tasmania) (11:09): Minister, with due respect, you've already responded to that Senate inquiry report, unless there's another report that you're referring to. Perhaps you could clarify that for us today. As I mentioned in my contribution, there's been—and good on the government—some legislative reform following that groundbreaking Senate inquiry, initiated by the Greens. I'm asking you this again. You are a minister of the Crown, of the Commonwealth government. What is your understanding of why grandfathered exemptions have a public policy purpose? What is their public policy purpose? I think it's really important for your government to stand up today and at least provide an explanation as to why you're not going to support Senator Patrick's amendment.

It may be that you don't feel it's related to what we have in this bill here today, but it is technically allowed. I would note that on the multinational anti-avoidance law bill that came in in 2015—which, by the way, was the most significant reform around tax avoidance that this chamber had seen in a decade—the Greens supported your government in good faith to get that bill through here. We also managed to achieve transparency on private companies worth over $200 million, making their accounts publicly available in, unfortunately, a fairly simplified format. Your government agreed to that amendment at the time to get the multinational anti-avoidance bill through. You could have given the same argument—that it wasn't technically related to the MAAL bill. Nevertheless, in hindsight, I think we all agree it was a good thing. Of course, I'm sure the Labor Party and the Greens would like more disclosure on a lower threshold than $200 million. That's something I believe Labor have moved in this chamber since then.

Just for the record, please explain to us why we need to provide grandfathered exemptions for some of the wealthiest individuals and companies in this country. Why should they not have to disclose their financial affairs when other companies have to? Private citizens all put in their tax returns. They do the right thing. They know the consequences if they don't. Why is it that big companies shouldn't be providing these accounts to ASIC?

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (11:12): Thank you, Senator Whish-Wilson. I reiterate my earlier answer that the government will respond to that Senate economics committee in a fulsome manner at another time. I think it would be very difficult for both Senator Whish-Wilson and Senator Patrick to deny that this government has done more than any other to ensure that everyone is paying the right amount of tax and taken more action than any previous government to close loopholes and ensure the ATO has the tools and resources that it needs to deter tax avoidance. With the Greens' and Centre Alliance's support, the Tax Avoidance Taskforce was set up in July 2016. The ATO had their resources increased dramatically, by $679 million over four years, specifically to target anti-avoidance activities by domestic and multinational enterprises, Australian public and private groups and wealthy individuals operating in Australia. I can also inform the Senate that, as of 30 April this year, the taskforce has 44 audits underway, covering 42 multinationals.

Senator WHISH-WILSON (Tasmania) (11:13): Minister, your disclosure then about some of the good work you're doing I totally acknowledge. The MAAL bill is a really good example of that. It kind of makes it even more important for you to explain why this anomaly exists, why you're allowing this grandfathering to continue. If you do believe in transparency and you do believe in tax justice—and I once again commend your government for the measures that you've brought before this place and the spirit of cooperation with which we've all worked on this together—it does seem very unusual and a significant anomaly that you would allow this exemption to remain in place. Of course, perceptions are everything in politics. You understand that as well as any of us here do. You need to provide an explanation as to why this grandfathering should remain in place.

If you can genuinely, hand on your heart, say that you've got a timetable for removing it and that you're going to provide a response to a report—that you've already responded to, by the way, and I'd ask you to go check on that—that's not credible in my eyes and I don't think it's credible in the public's eyes. If you promise us here in the chamber today that you're going to address this issue, then it may cause trouble for Senator Patrick. So perhaps it would be useful for you to consider that as an option—

A government senator interjecting—

Senator WHISH-WILSON: Well, Senator Patrick is making a very important point here, and I can guarantee that the Australian people, whether they go to pubs or drink at home—or whether they don't drink at all—would agree with it. There is no reason that big, wealthy benefactors of your party should be given exemptions from disclosing their financial affairs. I don't think anyone would disagree with that.

So could you give us a guarantee today that you will respond to that recommendation, and that you will put in place a process for removing the grandfathering exemptions, including bringing legislation before this place?

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (11:15): The issue raised by the Senate's proposed amendment is the subject of a recommendation in that committee report—the Senate Economics Committee's Corporate tax avoidance report, Part I—You cannot tax what you cannot see. The government, as I said, will respond to that recommendation as part of its response to the Senate Economics Committee's Corporate tax avoidance report.

Let me update the Senate to confirm that since the establishment of the task force that I referred to earlier, the ATO has in fact raised $17.2 billion in liabilities against public groups, multinationals, wealthy individuals and associated private groups, including trusts and aggressive tax planning.

Senator ROBERTS (Queensland) (11:16): Minister, you mentioned that the ATO has been effective in closing loopholes. There seems to be a swamp which they're neglecting, and that is the broader range of multinationals that are avoiding taxation. You just said that they've earned $17.2 billion, but there is a lot more than that—a hell of a lot more—and we need to address that.

But coming back to the point of Senator Patrick's amendment: do you see a problem with the companies on that list? They've been at it now for 25 years; surely that's enough to get their house in order?

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (11:17): Thank you, Senator Roberts. That's an issue that will be addressed by the government when it responds to that particular recommendation as part of its response to the Senate Economics Committee's Corporate tax avoidance report.

Senator ROBERTS (Queensland) (11:17): Is there a problem with these companies? They were given a temporary exemption and it's 25 years later. They were given a temporary exemption because of the new circumstances at the time back in 1995. That's a long time to have to learn how to do this.

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (11:17): I've answered that question, Senator Roberts.

Senator PATRICK (South Australia) (11:17): Minister, I have a double-barrelled question. As I circulated this amendment, I wonder if you sought advice from ASIC or from the ATO in relation to it? And, if so, what was that advice?

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (11:17): Senator Patrick I can say, personally, no, I did not seek advice from either ASIC or the ATO on this amendment—not personally.

The TEMPORARY CHAIR ( Senator Bilyk ): The question is that the amendment moved by Senator Patrick be agreed to.

Senator HANSON-YOUNG (South Australia) (11:26): by leave—I would like to move the amendments (1) and (2) on sheet 8970:

(1) Clause 2, page 2 (at the end of the table), add:

(2) Page 71 (after line 3), at the end of the Bill, add:

Schedule 4—Arts and Entertainment Industry Coronavirus Recovery Fund

1 Arts and Entertainment Industry Coronavirus Recovery Fund

(1) There is to be an Arts and Entertainment Industry Coronavirus Recovery Fund.

(2) The Finance Minister must, by legislative instrument, make rules to provide for and in relation to the establishment, governance and operation of the Fund, the purpose of which is to provide, in relation to the 2020‑21 financial year, for a rescue package to support the arts and entertainment industry in Australia.

(3) Money for the Fund is to be from funds appropriated by the Parliament for the purposes of this Act.

Note: Section 10 of the Supply Act (No.1) 2020‑2021 and section 12 of the Supply Act (No.2) 2020‑2021 provide for advances to the Finance Minister to facilitate urgent and unforeseen expenditure in certain circumstances, to ensure sufficient appropriations are available to support the coronavirus economic response.

(4) The Finance Minister must make the rules under subitem (2) before 30 June 2020.

(5) For the purposes of this item, Finance Minister means the Minister administering the Public Governance, Performance and Accountability Act 2013.

These amendments go to the crux of the issue that has been festering during this COVID crisis: that the arts and entertainment industry in Australia has been absolutely crippled by the impact of the lockdown and the health restrictions. Of course those were things that needed to be put in place, but it was the arts and entertainment sector that overnight was shut down. Overnight individual workers lost their jobs. Overnight hundreds of thousands—millions—of dollars were lost because of events being cancelled, gigs closed and festivals postponed. We are not even sure when these things are going to be able to reopen and what business as normal will look like going forward. Of course, while the arts and entertainment sector was a hard-hit industry and felt the impacts straight away, we know that, because of those large group gatherings, because of the nature of the arts and entertainment sector, it will be one of the last sectors to get out of this COVID crisis.

Much has been spoken about in relation to these issues, and of course the Prime Minister over a week ago referenced the fact that he understood that there were some industries that would need specific support and help. Some months ago, late in the evening, when we were debating the rescue packages being put forward by the government, I stood in this place and argued that there needed to be an arts-and-entertainment-industry-specific package before more jobs were lost and before more businesses went to the wall. Sadly, that didn't happen. Some people, of course, have been able to access JobKeeper, but many within the industry have been left out in the cold. But the big question will come in September when JobKeeper ends. The arts and entertainment industry will not be in a position come September to resume and to snap back as the government continues to insist. It just won't be.

So several months on I'm now pleading with the government again and for all in this place to insist that the Minister for Finance, who has the ability on rules that have already been agreed to by this place and the other, fund a specific package for arts and entertainment. I understand that this is an amendment that is quite separate to the rest of this bill, but it is important, it is urgent and we are facing an arts and entertainment emergency. It's totally lawful to do it. It's about whether you want to.

I specifically haven't put a figure in this amendment, because I want that to be based on the best advice that Treasury, the finance minister and the arts minister have and on what the Prime Minister is willing to cough up. This amendment requires the government to at least spend something on an industry that is going bust day after day. Every day we wait for something to be put on the table is another day another Australian artist, entertainer or creative worker loses their job. Every day we wait for something to be put on the table another business goes to the wall. Many of these businesses are small businesses. They employ a handful of people, but that is their livelihood.

Other industries have been acknowledged as needing specific support. We heard last week the Prime Minister make an announcement about the housing and construction industry. The arts and entertainment industry have lost almost one-third of their workforce. They are in desperate need of assistance and support. We can't wait until we come back to this place in August to see movement on this. We need to do something about it today.

The Prime Minister is already on the record saying that he understands this is an issue that needs to be dealt with. Here is an opportunity to make sure that something can happen and happen quickly. You can iron out the details. You as the government can decide what figure you want to put on it. This amendment says that the parliament requires it to happen.

I appeal to the Labor Party. They've been quite vocal on this issue as well. Let's make sure something actually happens. Let's make sure that the government is required to deliver a package—not just have the Prime Minister make promises when he's getting a few tough questions on his favourite radio show. Let's make sure that this parliament requires the government to do something for the arts and entertainment sector. Up to this point it has been all hollow promises and nothing has come down the line. It has been over a week and still there is nothing from this government. It has been three months, and the industry has gotten in a worse situation. Hundreds of thousands of Australians are unemployed because this government didn't act when it should have. Hundreds of thousands of Australians will remain out of work if we don't get something done today. I appeal to both sides to pass these amendments and to get on with supporting the arts and the entertainment sector across Australia.

Senator HUME (Victoria—Assistant Minister for Superannuation, Financial Services and Financial Technology) (11:33): Senator Hanson-Young, the government will be opposing your amendments. We believe that they are inappropriate amendments to this bill. Senator Hanson-Young, you're right—the Prime Minister and the minister for the arts have already confirmed that the government is looking at the issues impacting the arts, screen and entertainment sectors. In addition, a substantial number of organisations within the arts community are benefiting from the JobKeeper program. For example, I understand that Queensland Ballet, the Melbourne Theatre Company, the Sydney Symphony Orchestra and Opera Australia are all benefiting from the JobKeeper program. I'm also advised that the total support received for the initial JobKeeper fortnights in April by the creative and performing arts under the cash flow boosts and JobKeeper initiatives was around $99.6 million. We've also committed to a $27 million targeted support package for areas of the arts industry identified as being most affected by COVID-19, with dedicated financial support for Indigenous visual art centres and art fairs, regional arts and live music, and the performance industry.

It's very frustrating to see this bill, which has been around for some time, used for hobbyhorse issues by those from across the chamber, whether they be Centre Alliance, Labor or the Greens. We would like to stop playing political games, particularly with the lives of financial advisers, whom we seem to give nothing but banal platitudes of support. Let's let financial advisers have sufficient time to meet the government's new important standards.

Senator McALLISTER (New South Wales) (11:34): It is extremely disappointing, frankly surprising and, I suspect, for many people in the arts and entertainment industries, insulting to hear the minister describe the economic crisis being experienced by the arts and entertainment sector as a 'hobby horse'. That's certainly not the experience of the people whom I've been talking to, and I'm frankly shocked that you would describe it in those terms. This is an industry that has been shut down by the government and then abandoned. First, the government tried to pretend that the JobKeeper and the jobseeker packages were arts packages, which they plainly were not. Then it gave $27 million to some selected parts of the sector, which was welcome but nowhere near enough. Now it is talking about a relief package, but to date there is absolutely nothing to be seen, and those in the arts and entertainment sector could be forgiven for feeling that this government doesn't care about them and, in fact, holds them to contempt, as evidenced this morning by the description of this issue as a 'hobby horse'. How disgusting!

These people are workers, and they are absolutely vital to the beating heart of our nation. They need your help now, and it's only the government that can actually deliver it because it is the government that, at the moment, unfortunately, occupies the Treasury benches. It holds the purse strings.

Labor will be opposing this amendment. It's regrettable, but the truth is that the only way we can get action is for this government to act—this government that considers this issue a hobby horse. These amendments purport to create what is described as an arts and entertainment industry coronavirus recovery fund, but the sad truth is that they create an appropriation with no dollar value. As much as the Greens might try to convince us otherwise, and I commend their sincerity in this regard, the only way to deliver a much-needed funding boost to the arts and entertainment sector is for the government to move. The Prime Minister, Mr Morrison, and the Minister for Communications, Cyber Safety and the Arts, the missing Mr Fletcher, have been repeatedly found wanting. People cannot wait any longer.

Question negatived.

Senator PATRICK (South Australia) (11:39): by leave—I just want to indicate Centre Alliance's support for the Greens' amendments.

The TEMPORARY CHAIR: The support from Centre Alliance will be recorded.

Bill, as amended, agreed to.

Bill reported with an amendment; report adopted.

The ACTING DEPUTY PRESIDENT ( Senator Bilyk ) (11:41): I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Senator McALLISTER (New South Wales) (11:39): Can I draw your attention to the state of the chamber?

The PRESIDENT: I think we're pretty close. We've got a quorum, sorry.

Senator KENEALLY ( New South Wales — Deputy Leader of the Opposition in the Senate ) ( 11:42 ): I rise to speak on the Migration Amendment (Regulation of Migration Agents) Bill 2019 and the Migration Agents Registration Application Charge Amendment (Rates of Charge) Bill 2019. As we are debating these bills in concurrence and they're complementary to one another I will refer to them singularly as one bill.

I make clear from the beginning Labor supports this legislation and hopes the government seeks to pass it through parliament expeditiously. This was a commitment I, as a the responsible shadow minister, gave at the Law Council of Australia Immigration Law Conference on 6 March 2020.

They say a week is a long time in politics, so imagine how long six years feels by comparison. It's been six long years since the recommendations in this bill were first put forward. It's been six long years for lawyers who provide migration advice to have been operating under a scheme of dual registration.

The aim of this bill is to improve the effectiveness of the regulatory scheme governing migration agents. It contains measures stemming from the recommendations of the 2014 Independent Review of the Office of the Migration Agents Registration Authority, otherwise known as the OMARA review. In fact, Tony Abbott was Prime Minister when these recommendations were made. The current Prime Minister, Scott Morrison, was the immigration minister who received the OMARA review. I must give some credit to the government. They did introduce this bill into the last parliament in June 2017. It managed to get introduced to the Senate in May 2018. The Senate even debated that bill for a short amount of time in December 2018. Then, despite bipartisan support, that's where the legislation stopped. The bill sat in the Notice Paper for 211 days—a simple, straightforward bill which Labor has supported and recommendations that the Abbott-Turnbull-Morrison government has failed to make law for six long years. Even government senators recommended 'the Senate pass the bills without delay,' in the report from the Senate Standing Committees on Legal and Constitutional Affairs. After six years, multiple reviews, many sitting weeks and three Prime Ministers, this bill is finally before the Senate. Let's understand here that this bill will make changes to how migration agents are registered—that is, specifically to how lawyers are registered—

The PRESIDENT: Order! Senator Keneally, you will be in continuation when the debate resumes.

Senator DEAN SMITH (Western Australia—Government Whip in the Senate) (11:45): I present the 5th report of 2020 of the Selection of Bills Committee. I seek leave to have the report incorporated into Hansard.

Leave granted.

The report read as follows—

SELECTION OF BILLS COMMITTEE

REPORT NO. 5 OF 2020

1. The committee met in private session on Thursday, 11 June 2020 at 7.15 pm.

2. The committee recommends that—

(a) the provisionsof the Payment Times Reporting Bill 2020 and the Payment Times Reporting (Consequential Amendments) Bill 2020 be referred immediatelyto the Education and Employment Legislation Committee for inquiry and report by 30 July 2020 (see appendix 1 for a statement of reasons for referral);

(b) the provisionsof the Primary Industries (Customs) Charges Amendment (Dairy Cattle Export Charge) Bill 2020 be referred immediatelyto the Rural and Regional Affairs and Transport Legislation Committee for inquiry and report by 30 July 2020 (see appendix 2 for a statement of reasons for referral); and

(c) the provisionsof the Product Stewardship (Oil) Amendment Bill 2020 and the Excise Tariff Amendment Bill 2020 be referred immediatelyto the Environment and Communications Legislation Committee for inquiry and report by 30 July 2020 (see appendix 3 for a statement of reasons for referral).

3. The committee recommends that the following bills not be referred to committees:

Aboriginal Land Rights (Northern Territory) Amendment (Jabiru) Bill 2020

Australian Prudential Regulation Authority Amendment (APRA Industry Funding) Bill 2020 Authorised Deposit-taking Institutions Supervisory Levy Imposition Amendment Bill 2020

Authorised Non-operating Holding Companies Supervisory Levy Imposition Amendment Bill 2020

General Insurance Supervisory Levy Imposition Amendment Bill 2020

Life Insurance Supervisory Levy Imposition Amendment Bill 2020

Retirement Savings Account Providers Supervisory Levy Imposition Amendment Bill 2020

Superannuation Supervisory Levy Imposition Amendment Bill 2020

Aviation Legislation Amendment (Liability and Insurance) Bill 2020

Coronavirus Economic Support and Recovery (No-one Left Behind) Bill 2020

Fair Work Amendment (COVID-19) Bill 2020

Galilee Basin (Coal Prohibition) Bill 2018

Great Barrier Reef Marine Park Amendment (Coronavirus Economic Response Package) Bill 2020

National Skills Commissioner Bill 2020

Norfolk Island Amendment (Supreme Court) Bill 2020

Treasury Laws Amendment (2020 Measures No. 2) Bill 2020.

4. The committee deferred consideration of the following bills to its next meeting:

Aged Care Legislation Amendment (Improved Home Care Payment Administration No. 1) Bill 2020

Air Services Amendment Bill 2018

Australian Education Legislation Amendment (Prohibiting the Indoctrination of Children) Bill 2020

Banking Amendment (Deposits) Bill 2020

Broadcasting Services Amendment (Regional Commercial Radio and Other Measures) Bill 2020

Commonwealth Electoral Amendment (Ensuring Fair Representation of the Northern Territory) Bill 2020.

Constitution Alteration (Freedom of Expression and Freedom of the Press) 2019

Customs Amendment (Safer Cladding) Bill 2019

Discrimination Free Schools Bill 2018

Education Legislation Amendment (2020 Measures No. 1) Bill 2020

Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020

Governor-General Amendment (Cessation of Allowances in the Public Interest) Bill 2019

Great Australian Bight Environment Protection Bill 2019

Health Insurance Amendment (Continuing the Office of the National Rural Health Commissioner) Bill 2020

National Disability Insurance Scheme Amendment (Strengthening Banning Orders) Bill 2020

Regional Forest Agreements Legislation (Repeal) Bill 2017

Services Australia Governance Amendment Bill 2020

Social Services and Other Legislation Amendment (Omnibus) Bill 2020

Social Services Legislation Amendment (Better Targeting Student Payments) Bill 2019

Social Services Legislation Amendment (Ending the Poverty Trap) Bill 2018

Social Services Legislation Amendment (Payment Integrity) Bill 2019

Treasury Laws Amendment (2020 Measures No. 3) Bill

Veterans' Affairs Legislation Amendment (Supporting the Wellbeing of Veterans and Their Families) Bill 2020.

(Dean Smith)

Chair

12 June 2020

Appendix 1

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Names of bills:

PAYMENT TIMES REPORTING BILL 2020

Payment Times Reporting (Consequential Amendments) Bill 2020

Reasons for referral/principal issues for consideration:

Use of delegated legislation (Minister's Rules) for detail rather than in main legislation

Technical issues - treatment of supply chain financing, appropriateness of reporting thresholds

Unlikelihood the measure will reduce payment times from large businesses

Submissions to earlier consultations (e.g. draft legislation) were not made public

Possible submissions or evidence from:

COSBOA, Small Business and Family Enterprise Ombudsman, Self-Employed Australia, Industry Dept (Small Business Division), BCA, CPA Australia, Chartered Accountants

Committee to which bill is to be referred: Senate Economics Legislation Committee

Possible hearing date(s):

To be determined by the committee

Possible reporting date:

30 July 2020

Senator Anne Urquhart

Appendix 2

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Primary Industries (Customs) Charges Amendment (Dairy Cattle Export Charge) Bill 2020

Reasons for referral/principal issues for consideration:

To investigate the effectiveness of the bill with regards to funding the Dairy Cattle Export Program

Investigate including breeder cattle into the Export Assurance Supply Chain System (ESCAS)

How effective has the Morrison Government been at influencing animal welfare conditions in importing countries outside of ESCAS

Is it in Australia's National Interest for the Morrison Government to make available funding for marketing and R&D activities in developed countries such as Japan?

Any other related matters.

Possible submissions or evidence from:

Australian Livestock Exporters' Council (ALEC)

Australian Livestock Export Corporation Limited (LiveCorp)

Dairy Connect

Farmer Power

Queensland Dairyfarmers' Organisation

NSW Farmers' Federation

National Farmers' Federation

Futureye - The Department of Agriculture and Water Resources requested Futureye to identify expectations of farm animal welfare to understand whether the current regulations are perceived to be sufficient.

Department of Agriculture - specifically live animal export and animal welfare division.

Committee to which bill is to be referred:

Senate Rural and Regional Affairs and Transport Legislation Committee

Possible hearing date(s):

To be determined by the Committee

Possible reporting date:

30 July 2020

Senator Anne Urquhart

Appendix 3

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill: Product Stewardship (Oil) Amendment Bill 2020

Reasons for referral/principal issues for consideration: To examine advice received by the Government in relation to the impact of the Caltex Australia Petroleum Pty Ltd v Commissioner of Taxation [2019] FCA 1849 case and related levy scheme that underlies this Bill.

Possible submissions or evidence from: The Department of Agriculture, Water and the Environment, Australian Taxation Office

Committee to which bill is to be referred: Senate Environment and Communications Legislation Committee

Possible heading date(s):

To be determined by the Committee

Possible reporting date:

30 July 2020

Senator Anne Urquhart

Senator DEAN SMITH: I move:

That the report be adopted.

Question agreed to.

Senator SIEWERT (Western Australia—Australian Greens Whip) (11:52): I, and also on behalf of Senator Hanson-Young, move:

That the following matter be referred to the Environment and Communications References Committee for inquiry and report by 8 December 2020:

The protection and preservation of First Nations heritage, with specific reference to:

a. the destruction of the Juukan Gorge rock shelters;

b. any First Nations heritage sites in Western Australia and other states and territories that are at risk of destruction;

c. the adequacy of the Aboriginal and Torres Strait Islander Heritage Protection Act 1984 in protecting and preserving First Nations heritage;

d .the adequacy of the Environment Protection and Biodiversity Conservation Act 1999 in protecting and conserving First Nations heritage;

e. the role of state, territory and Commonwealth governments in protecting First Nations heritage;

f. barriers to First Nations heritage and cultural protection in Australia; and

g. any related matters.

Senator DUNIAM (Tasmania—Assistant Minister for Forestry and Fisheries and Assistant Minister for Regional Tourism) (11:52): I seek leave to make a short statement.

The PRESIDENT: Leave is granted for one minute.

Senator DUNIAM: The Australian government is deeply disappointed about the destruction of Indigenous sacred sites at Juukan Gorge in Western Australia. This matter has already been referred to the Joint Standing Committee on Northern Australia for inquiry, and the government will await the findings of that inquiry.

This was an action approved under section 18 of the WA Aboriginal Heritage Act. The Western Australian government has commenced a review of that act, and the Australian government is committed to ensuring that Commonwealth law provides the right protections for Indigenous cultural heritage. This is being considered through the current independent review of the EPBC Act 1999.

Senator GALLAGHER (Australian Capital Territory—Manager of Opposition Business in the Senate) (11:53): I seek leave to make a short statement.

The PRESIDENT: Leave is granted for one minute.

Senator GALLAGHER: Labor will not be supporting this motion. We proposed an alternative approach to make sure that the destruction of cultural heritage, like what happened in Juukan Gorge, doesn't happen again. Our bipartisan referral to the Joint Standing Committee on Northern Australia can not only get to the bottom of what has occurred here but, potentially, deliver real change.

First Nations people and all Australians deserve answers about why this happened and how we can prevent it from happening again. This is 46,000 years of history and heritage; it is deeply distressing. First Nations history and culture are fundamental to our nation.

The PRESIDENT: The question is that business of the Senate motion No. 1 be agreed to.

Senator GRIFF (South Australia) (12:12): I move:

That the following bill be introduced: A Bill for an Act to amend the law in relation to financial transparency in the aged care sector, and for related purposes.

Question agreed to.

Senator GRIFF: I present the bill and move:

That this bill may proceed without formalities and be now read a first time.

Question agreed to.

Bill read a first time.

Senator GRIFF (South Australia) (12:13): I move:

That this bill be now read a second time.

I seek leave to table an explanatory memorandum relating to the bill.

Leave granted.

Senator GRIFF: I table an explanatory memorandum and seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows—

I have long advocated for greater financial transparency within the aged care sector - it has been a long time coming - but that time is now.

People were shocked by the extent of the abuse and poor care exposed in the interim report by the Royal Commission into Aged Care Quality and Safety. It was a scathing report and an indictment on an industry that is meant to deliver respectful, good-quality care during an aged person's final years.

The interim report showed that the government has deep systemic work to do to fix the aged-care system. It also needs to increase its investment. But it cannot simply pour money into the system without asking for a more accountable and transparent situation from providers. It is the quid pro quo aged care providers must deliver, given that they are underpinned by significant federal subsidies. In 2018–19, governments spent over $20 billion on aged care, with the majority—approximately 66 per cent of this—for residential aged care.

On the last day of sitting in 2019 I moved an amendment for greater financial transparency in the aged sector to the Government's the Aged Care Legislation Amendment (New Commissioner Functions) Bill 2019 that would have required residential aged care providers to give annual financial statements to the Aged Care Quality and Safety Commissioner, who would then make them public.

Regrettably, One Nation leader, Senator Pauline Hanson, and the Federal Government colluded, after they were heavily lobbied by some aged care providers, to block that game-changing amendment. This amendment would have forced aged care providers to reveal how much they actually spend on food, staff, and other costs of delivering care.

It was an important opportunity missed.

Sadly, it showed just how strong the ties that bind the aged care lobby and government really are. It was a deplorable act.

The aged care industry has been successfully lobbying governments for years arguing against more transparency. The influence of the industry through government committees, thinktanks and policies is well known and is being rightly questioned at the royal commission.

It was also an odd choice for Senator Pauline Hanson, who has previously rallied against the aged care sector for "rorting and malpractice".

Consequently, I have brought that amendment back and finessed it into this private senator's bill - the Aged Care Legislation Amendment (Financial Transparency) Bill 2020 which requires aged care providers to disclose their income, their spend on food and medication, the amount spent on staff and staff training, accommodation, administration, and how much they pay out to their parent bodies.

This will enable families of loves ones, stakeholders and the public to have a clear view – for the first time - on the proportion of income those providers actually spend on costs of care and how much is being pocketed or wasted.

It is a simple bill that provides crucial information in the public interest. It has the potential to be game changer in the aged care space.

Providers might object to the administrative 'burden' of having to provide annual financial statements but, frankly, that is a paltry concern when weighed against the vast public benefits transparency will delivered, should this bill pass.

The Royal Commission into Aged Care Quality and Safety has got financial transparency squarely on its agenda.

In its "Background Paper 1: Navigating the Maze: An Overview of Australia's Current Aged Care System", the Royal Commission provided an overview of aged care funding models and summarised who pays for what. Then, in its Interim Report, the Royal Commission criticised the aged care system for failing to publish sufficiently specific financial information, saying "there is no public information on the way providers use taxpayers' funds and individuals' contributions to deliver aged care services."

That must change, but we do not need to wait for the Royal Commission's final report and the consequent delays in dealing with the pandemic crisis forcing the suspension of hearings and workshops and the extension of submission - we must act now.

Organisations are transparent when they enable others to see and understand how they operate in an honest way. This must apply to the aged care sector – they should not be exempt in any way. This Bill will ensure that goal is achieved.

The bill does not require private information (such as client records) and 'commercial in confidence' material (such as tender submissions) to be made public. It is primarily concerned with how monies are spent.

Unlike hospital and child care centres, aged care facilities can employ as few staff as they like because there are no staff-to-resident ratios in nursing homes. We don't know how much they spend on staff, or what categories of staff they spend their money on.

When it comes to food, a study of 800 nursing homes shows the average spend is just $6 a day.

The Australian Broadcasting Corporation (ABC) Q&A program "Spotlight on Aged Care" recently highlighted the issue of financial transparency in aged care. Panel member Sarah Holland-Batt, who gave evidence on the abuse and neglect of her father to the Royal Commission, told the audience:

I think something that ' s just been lost in this discussion about funding is the transparency about where exactly it ' s going … we ' ll be spending $20 billion on aged care funding, which is a lot of money when you consider there are around 200,000 people in residential care, and then people with Home Care Packages …

We also know that with aged care funding, with residential aged care funding, that, yes, some providers are struggling. But other providers are paying out gigantic dividends and making huge profits for their shareholders when they ' re primarily being funded with Commonwealth government funding.

So, I really think that, in order to be given these cheques for more taxpayer funds, we need radical transparency about where this money is going.

Ms Holland-Batt's comments raise important points and demonstrate that financial transparency is an issue of grave concern to the public.

I could not agree with her more.

Under the Bill approved providers will have to provide annual financial statements to the Quality and Safety Commission, which will then make them public. The financial statements will detail the amount spent on the provision of care—things like food and medication—as well as the amount spent on staff and staff training, accommodation, administration and the amounts paid out to parent bodies.

At the moment, there is no clear way to know how much a provider is spending on the provision of care. Is it 30 per cent of their income? Is it 50 per cent or 70 per cent? We just do not know how much a provider is pocketing as profit at the expense of the people in their care. Currently, providers can spend their taxpayer subsidies pretty much as they choose. But, in an environment where our elderly are being subjected to systemic neglect, they very much must be held to account.

My office has heard firsthand accounts from people who work with and for aged-care providers highlighting that dodgy financial decisions and profiteering takes place. For instance, there is a hundred-bed provider that has made $2.5 million in profit three years running, but this profit is only shown as $500,000 on its financials, because they pay $2 million in rent to the parent company which already owns the building and there is a 50-bed not-for-profit facility where the salaries for three managers exceeded $500,000 at a time when the home could not meet basic minimum standards and was also, as it turns out, sanctioned. And there are other providers using subsidies to help send senior staff to overseas award ceremonies and lavish conferences.

This amendment has the support of the Australian Nursing and Midwifery Federation, whose members are at the coalface and I thank them for their input into the bill. They and many other stakeholders want financial transparency so that it is finally clear how much facilities actually spend on delivering care and how much is pocketed or wasted.

In an ABC story about the royal commission's Hobart hearing which emphasised why these amendments are needed. That story detailed how Bupa South Hobart was so understaffed that, according to the daughter of two residents, her 90-year-old mother had been forced to clean up after her incontinent father and at times help a blind elderly resident go to the toilet because the woman's calls for help had gone unanswered. According to the ABC story, a former Bupa regional director said there was pressure on the facility to spend less on staffing. Part of her responsibility was to 'improve the commercial operation in South Hobart'. In other words, her job was to increase profits.

This should outrage us all.

My bill is all about transparency and accountability – we expect this of our politicians and we must expect it from our publicly funded services especially in the aged care sector.

Knowledge is power, as they say. The bill seeks factual information from providers so we will have a clearer picture of how their facilities are resourced. This will be crucial if we are to engage in sustainable reforms to the sector that will improve the experience and treatment of vulnerable elderly people living in residential aged care.

Senator GRIFF: I seek leave to continue my remarks later.

Leave granted; debate adjourned.

Senator KITCHING (Victoria) (12:50): The ALP's position on the Health Insurance Amendment (General Practitioners and Quality Assurance) Bill 2020 is that GPs are eligible for higher Medicare rebates if they are fellows of the GP colleges and meet the ongoing continuing professional development requirements. The current system for determining eligibility for those higher rebates is administered by Services Australia and duplicates the separate requirements of the National Registration and Accreditation Scheme. This bill removes the requirement for eligible GPs to register with Services Australia and instead ties eligibility for higher Medicare rebates to the existing scheme. This is a sensible change and Labor will support this bill.

Senator DUNIAM (Tasmania—Assistant Minister for Forestry and Fisheries and Assistant Minister for Regional Tourism) (12:50): It's a pleasure to speak on this, the Health Insurance Amendment (General Practitioners and Quality Assurance) Bill 2020, and indeed I do thank Senator Kitching and the opposition for their contribution to debate on this. In summing up debate, I'd like to start by saying that the bill simplifies Medicare administrative processes for recognition as a specialist general practitioner, or a GP, for Medicare purposes under the Health Insurance Act 1973 and will align Medicare eligibility for GPs with the National Registration and Accreditation Scheme, NRAS, and the requirements therein.

The NRAS commenced in 2010 and, for the first time, provided a nationally consistent process of regulation for 16 health professions, including GPs. The NRAS established the Medical Board of Australia, the MBA, which is responsible for standards for the medical profession, including specialist registration and, of course, setting standards for mandatory continuing professional development, CPD. The Australian Health Practitioner Regulation Agency, AHPRA, provides operational support for the MBA and holds the most up-to-date and accurate data source for the registration status of general practitioners. Services Australia will automatically update GPs' Medicare access, based on regular data provided by AHPRA, and this will simplify processes for GPs with their Medicare recognition.

The bill will also update the definition of 'general practitioner' in the Health Insurance Act 1973 to align with the national registration arrangements. Transitional and grandfathering provisions to be made in the Health Insurance Regulations 2018 will also ensure that medical practitioners who are currently eligible for these higher GP rebates, will continue to maintain this eligibility.

The Royal Australian College of General Practitioners, the RACGP, and the Australian College of Rural and Remote Medicine, ACRRM, are the professional bodies for general practice and, together with the MBA, are responsible for ensuring quality in general practice across the country. Every three years, the RACGP and ACRRM advise Services Australia that GPs are compliant with CPD requirements to maintain patient access to higher Medicare rebates. This amendment will remove this duplicative reporting of CPD to Medicare. Extensive consultation with the RACGP and ACRRM, the Australian Medical Association, AHPRA and the MBA, has involved careful consideration to ensure currently eligible medical practitioners who are practising as GPs will continue to be eligible for higher rebates with minimal administrative requirements to be completed.

Schedule 2 of this bill removes references to repealed legislation and replaces it with reference to the Federal Financial Relations Act 2009. The bill will also ensure that activities declared on or after 1 July 2009, are taken to have been valid declarations.

I'm pleased to report that key stakeholders have been consulted as part of the drafting of the bill and support these streamlined processes. I'd like to extend my thanks to the professional groups, many of which have already been mentioned, who engaged with the proposals in this bill. I thank senators once again for their contribution and commend this bill to the Senate.

The ACTING DEPUTY PRESIDENT ( Senator Bilyk ) (12:54): As no amendments to the bill have been circulated, I shall call the minister to move the third reading unless any senator requires that the bill be considered in Committee of the Whole.

Senator DUNIAM (Tasmania—Assistant Minister for Forestry and Fisheries and Assistant Minister for Regional Tourism) (12:55): I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Senator KENEALLY (New South Wales—Deputy Leader of the Opposition in the Senate) (12:55): I seek to continue my remarks on this bill. Let's understand here that this bill will make changes to how migration agents are registered, specifically to how lawyers are registered as migration agents. The main purpose is to implement the recommendation of the 2014 review of the MARA which recommended the removal of lawyers from the Migration Agents Registration Authority scheme.

This bill amends the Migration Act 1958 to remove the requirement for lawyers who hold practising certificates from registering as migration agents when providing immigration advice to their clients. This will be achieved by removing them from the regulatory scheme that governs migration agents. Lawyers will not go unchecked, however. Those who choose to provide migration advice will still be entirely regulated comprehensively by their own state and territory legal professional bodies when providing said advice. I hope when this bill becomes law, it will allow more lawyers to perform pro bono migration work for some people who need legal representation more than most in our society, including asylum seekers. Quality, fair and efficient legal representation is one of the pillars of our justice system and it should be treated with equal regard when it comes to migration law.

There have also been some minor and technical changes to this revised bill since its first iteration. This includes updating the academic and vocational requirements for applicants to be registered with the MARA; to complete the graduate diploma and Capstone assessment.

No fewer than six ministers or assistant ministers have had carriage of this legislation, including Senator Reynolds in her former role as the Assistant Minister for Home Affairs. However, the delay in abolishing the dual regulation of immigration lawyers rests squarely at the feet of the Minister for Home Affairs, Peter Dutton. As much as the Minister for Home Affairs avoids discussing the migration aspects of his responsibilities, he is the senior minister when it comes to the Department of Home Affairs. While there may be an acting immigration minister at present, Minister Tudge, Minister Dutton is ultimately responsible for the department, its actions and legislation.

It should come as no surprise that there were eight pieces of migration legislation the Minister for Home Affairs failed to pass in the last parliament. They sat on the Notice Paper for an accumulative 3,749 days. The current government has been in power for the past seven years and they are responsible for the administration of, as well as any amendments to, Australia's migration law. Their failures go to the heart of migration law in this country and how the failures of the current government impact the lives of real people. Even the supposed plans the government so enthusiastically spruiked, such as their plan to encourage regional migration, are in disarray—and they were in disarray before the COVID-19 pandemic. The government heralded the Designated Area Migration Agreements, otherwise known as DAMAs, as a solution for Australia's regional migration woes but, as of 31 December last year, prior to the pandemic, only two visas in the entire country had been granted under the government's new agreements—two visas, across six agreements.

We also have a government and a minister willing to ignore the symptoms that are presenting themselves when it comes to the abysmal health of Australia's migration system. Since I became the shadow minister for home affairs, I've sought to challenge the current minister's track record. And, while talking points may be a strength of Mr Dutton, his ability to oversee the Department of Home Affairs and his inability to arrest the emerging problems show how this department is plagued with his incompetence.

The health of Australia's migration system is dire. As of 31 March, there were over 281,000 people on bridging visas in Australia, the majority of whom would be waiting for the Department of Home Affairs to process their substantive visa applications. This has more than doubled since Labor left office in 2013. The processing time for 90 per cent of partner visas is currently at an astonishing 28 months. That's 2½ years Australian citizens are waiting to progress in their lives with their partners, their husbands and their wives. There are more than 180,000 people in that position—over 90,000 Australians and 90,000 of their prospective partners in a state of migration limbo. There are over 62,000 visa over stayers in Australia, and I doubt Mr Dutton knows where all of these non-citizens are.

All of these migration matters are only complicated further by the caseload of the Administrative Appeals Tribunal. As of 31 May there were close to 64,000 cases before the migration and refugee tribunal of the AAT. Case dates are currently being listed for 2022. The ever growing backlog is not going to improve with ignorance or incompetence. These symptoms affect real people. They affect Australians. They affect the fabric of our society.

Minister Dutton is a minister with no plan for his department or the major issues facing Australia. You used to be able to trust this government to manage Australia's borders but, sadly, that is not the case anymore. Sadly, that is not the case anymore. Let's not forget Operation Sovereign Borders has bipartisan support, but as the airplane people blowout shows you cannot trust this government with our borders anymore.

Let's not forget Minister Dutton is the minister who lost control of the borders. We witnessed the explosion of airplane arrivals in Australia claiming asylum—people being trafficked to Australia on tourist visas in record numbers then made to apply for asylum. This minister, Peter Dutton, and the Prime Minister, Scott Morrison, failed to notice when the people smugglers changed their business model from boats to planes. You simply can't trust this government anymore when it comes to borders. I notice the silence now emanating from the other side.

Given the fact that this bill has been an idea for six years you wonder when the minister will take some action to disrupt the people smuggling operations trafficking migrants through our airports in record numbers—

Government senators interjecting—

Senator KENEALLY: To those senators on the other side, it's not a funny subject. It shouldn't be a funny subject, but yet they find it amusing. Let me say this: there is nothing wrong with claiming asylum. It's an important right. But 90 per cent of applications, such as these, are eventually found to be without merit. Even the assistant minister, Jason Wood, warned of his own government's failures last February on this crisis, which is occurring on Minister Dutton's watch and still Minister Dutton has not acted. It's no surprise, when you think about how long it's taken to simply pass this legislation, Minister Peter Dutton doesn't have a plan to deal with the record number of asylum claims occurring on his watch, with the blowout in processing time for partner visas, with the record number of people on bridging visas. And he has no intention to address the further exploitation and slavery-like conditions these trafficked people are experiencing here on Australian soil.

Finally, of course, there is the Ruby Princess, the largest outbreak of coronavirus in Australia. Mr Dutton failed to stop the one boat that mattered. Let's not forget 850 cases of coronavirus and over 30 tragic deaths, 10 per cent of all cases in Australia. The outbreak in north-west Tasmania is all linked to the Ruby Princess.

While state health authorities have responsibility under the federal Biosecurity Act, when it comes to Australia's migration program and our borders the buck is supposed to stop with the home affairs minister, Peter Dutton. Let's not forget it was the Prime Minister who stood up and said he was going to put arriving cruise ships under the direct command of the Australian Border Force. Four days after the Prime Minister said that, the Ruby Princess came into port and let everyone out, spreading—

Government senators interjecting—

Senator KENEALLY: I note the interjections on the other side. Suddenly they're a bit more sensitive about border security. They don't particularly care about the slavery-like conditions of the people who have been trafficked here through their airports and made to apply for asylum, but, when you talk about boats and their failure to deal with the one boat that mattered, they suddenly get sensitive.

So here we are. They know what the Australian people now know, which is that you can't trust this government anymore when it comes to our borders, so I will always hold this government to account when it comes to the Home Affairs portfolio and the Migration Act. Labor will work with the government to support sensible reforms, as we are doing today—sensible reforms that took you only six years to bring into the parliament! We're glad this legislation is finally before the Senate. It took only six years and three prime ministers, but here we are, finally, today. And I am pleased to tell you, Madam Deputy Acting Speaker, that Labor will support this sensible, overdue, long-awaited reform.

Maybe now the Minister for Home Affairs could get on and deal with the excessive backlog of partner visas and bridging visas, with the backlog at the AAT, with the fact that the Department of Home Affairs ranks 93 out of 93 departments when it comes to morale and with the fact that a third of the people who work in Home Affairs would rather work somewhere else. Maybe he could get on with the Future Maritime Surveillance Capability project. I mean, it took only six years to do this simple piece of legislation! Maybe now that he's cleared this big project off his plate, he could get on and deal with some of the substantive issues that are plaguing the Department of Home Affairs. And I haven't even mentioned the Paladin cost blow-out and the massive waste of taxpayer dollars there. Given that the Minister for Home Affairs has finally managed to get this substantive piece of legislation off his desk after six years, maybe he could just get on and deal with some of the bigger, more pressing problems that are facing real Australians in our community and could clear up some of the backlogs in his own portfolio. Incompetence is not an excuse for his maladministration.

Senator McKIM (Tasmania—Deputy Leader of the Australian Greens in the Senate) (13:07): I had to look a couple of times to make sure we were actually on the Migration Amendment (Regulation of Migration Agents) Bill, but I'm glad the Senate has shown Senator Keneally some latitude, and I'll take advantage of that to make a couple of comments in response to some of the things that she said. But, before I do, I will just directly address the legislation before us, which is, of course, similar to bills of the same name tabled in 2017 and amended in 2018, though with a redrafting of schedule 4 of the regulation of migration agents bill and minor amendments to definitions in the rates of charge bill. It's worth noting that both the 2017 and 2019 bills were referred to and reported on by the Senate Legal and Constitutional Affairs Legislation Committee.

Currently, it's unlawful to provide immigration advice without being registered as a migration agent with the Office of the Migration Agents Registration Authority, or OMARA. These bills, however, seek to change that, driven by an argument that lawyers, regardless of their professional or educational background, do not need to be regulated alongside specialist migration agents because their skills in existing consumer protections are comparable. The Greens do not believe this argument has merit and will not be supporting these bills.

Whereas postgraduate study to become a migration agent includes four migration law subjects, most undergraduate law degrees do not include any study whatsoever of migration law. Yet, with these bills, any and all lawyers will be able to practise migration law solely because they hold a legal practising certificate. The government is therefore suggesting a registered migration agent who has successfully completed a postgraduate migration agent course is no better equipped to advise on migration law than a lawyer, who may not have studied any specific migration law subjects whatsoever.

Under these bills, lawyers practising migration law will no longer be required to subscribe to LEGENDcom, an electronic Home Affairs database of migration and citizenship legislation and policy documents that is continually updated as migration legislation—which is, as all senators would recognise, very fluid—changes. Registration of lawyers by OMARA ensures lawyers comply with a Migration Agents Registration Authority, or MARA, Code of Conduct, which requires practitioners to maintain relevant, specialist and up-to-date knowledge of migration law and processes.

The current system of registration of migration agents includes robust complaints mechanisms and codes of conduct, which, when complaints are lodged, set in motion thorough investigations. These processes are customer focused to ensure the rights and needs of customers are paramount and are protected. This is a particularly valuable safety net for vulnerable customers. The inclusion of lawyers in the migration regulation scheme is similar to the case of an accountant who must undergo further studies if they want to be registered as a tax agent. To practise patents law, a lawyer must undertake further studies in the area before they are allowed to appear in a matter, so it is not an oddity that lawyers should be required to demonstrate some migration law expertise or be required to keep up to date with migration law.

Of particular concern to the Greens and many in the industry is the provision of migration services to vulnerable people. In its submission to the Senate inquiry into the 2019 bills, the Migration Institute of Australia noted:

Those who oppose dual regulation claim that the legal profession has sufficient complaint and disciplinary mechanisms to deal with professional incompetence or malfeasance. However, some law societies do not appear to have the same regard for migrant consumer protection as the OMARA. Lawyers have been allowed to continue practicing by their law societies, even after being banned by the OMARA for providing fraudulent migration advice or breaches of fiduciary duties.

Furthermore, there are legitimate concerns that these bills will lead to a loss of legal expertise or legal aid funded services in large non-legal migration agencies, including refugee services, because lawyers would seek employment elsewhere. In its submission to the Senate inquiry into the 2017 bills, the Migration Institute of Australia warned, in relation to the humanitarian migration sector:

The removal of lawyers from the regulatory system will result in disastrous, unintended consequences for this sector. It is crucially important that it be protected for both consumers and the large numbers of altruistic lawyers working in this sector. If removed from the OMARA regulatory system these lawyers:

will be barred from registering as migration agents and then be unable to provide migration advice and assistance within these non-legal practices, and

will need to leave these organisations to seek employment in legal practices if they wish to practice as lawyers.

This will have dire and wicked knock-on effects for service providers, many of them publicly funded; for early career lawyers wanting to specialise in migration but no longer able to provide advice under the OMARA regulatory system as registered migration agents in non-legal migration practices; and, most importantly, for clients.

The Migration Institute of Australia has further warned that, if lawyers are removed from the regulatory system, the migration advice profession will be opened up to lawyers who are currently sanctioned or banned by OMARA but who will continue to be allowed to practise by their relevant law societies; lawyers who have no knowledge of Australia's complex migration legislation and policy; lawyers who are not compelled to maintain currency of knowledge and professional resources pertaining to this area of law, as required by OMARA registration; and lawyers who choose to practise immigration assistance to supplement their struggling legal practices.

For these reasons, the Australian Greens agree with the Migration Institute of Australia's conclusion:

Much of the emphasis in support of removing lawyers from the regulatory system relies on concerns harboured by the impacts on lawyers, with apparent disregard for the impact on consumers.

The Greens believe that consumer protection needs to be the uppermost consideration in this legislation to protect people who are vulnerable to those who would take fees to provide advice and services in areas that they do not have sound knowledge or practice in. For many vulnerable consumers, the difference between good and bad advice and services can be devastating, and life changing, with bad advice and service potentially leading to financial ruin and/or being banned from this country.

Lawyers could have remained within the regulatory system by being exempted from paying the duplicate registration fee and insurance. They could have been required to undertake studies in migration law practice and procedure and been required to maintain continuing professional development in migration law. But the government, for whatever reason, has chosen not to pursue this option and has instead decided to throw the baby out with the bath water. Currently, lawyers make up just over 30 per cent of all registered migration agents. What these bills will effectively do is carve out nearly one-third of all practising migration agents from the codes of conduct and complaints and disciplinary mechanisms that MARA provides and upholds. But, if this is the path the government and Labor insist on going down, the Greens will try to ensure there is at least some level of accountability in this deregulation of lawyers working as migration agents.

In its report entitled Annual review of regulatory burdens on business: business and consumer services, the Productivity Commission recommended that, if dual regulation of lawyers should cease, an independent review of the performance of these immigration lawyers and the legal profession complaints handling and disciplinary procedures with respect to their activities should be conducted three years after an exemption becomes effective. That is why the Greens will move an amendment to this legislation—to legislate that review into the regulation of migration agents bill.

Senator Keneally has again used an opportunity today to prosecute an argument that she's been prosecuting for a long period of time around so-called airplane people. This is a deeply concerning argument and represents a political attempt by Senator Keneally and the Labor Party to outflank a fascist from the right. They will find it impossible to outflank Minister Dutton on migration issues from the right. They will find it absolutely impossible. But that is, unfortunately, not preventing Senator Keneally from attempting that political manoeuvre and, in doing so, going down a very dangerous path.

I want to put on the record today why the Australian Greens believe it is a dangerous path. Firstly, describing people who come to this country to seek asylum in line with the obligations to which Australia signed up when we signed the protocol to the refugee convention as 'airplane people' uses language perfected by people like Prime Minister Morrison, Minister Dutton and Senator Hanson. It is language deliberately designed to dehumanise and demonise people who seek asylum, and it strongly implies that we in this country have something to fear from migrants and people seeking asylum, when, in fact, we don't.

Secondly, if people have a valid claim for asylum in Australia, they should be allowed to make it. Minister Dutton might not like it and, for all I know, the Australian Labor Party might not like it. But, regardless of whether they like it or not, we are still a signatory to the refugee convention, despite the last 20 years of bipartisan cruelty to people seeking asylum from the major parties in this place.

Finally, and most dangerously, egging on Minister Dutton and Prime Minister Morrison to crack down further on people seeking asylum could have disastrous consequences and could ultimately cost yet more people their lives. Let's face it: the Australian Labor Party were the architects of the most recent iteration of offshore detention when in 2013 Prime Minister Kevin Rudd said, 'If you arrive here by boat without a valid visa, you will never be allowed into the country.' Let's face it: this iteration of offshore detention has already cost multiple people their lives and has destroyed the lives of hundreds and potentially thousands of other people. It shouldn't need saying to Senator Keneally or the Australian Labor Party, but Minister Dutton and Prime Minister Morrison do not need further encouragement to ruin and destroy the lives of people seeking asylum. They don't need further encouragement to do that, but that is what Senator Keneally is doing by trying to outflank them from the right on this issue. I beg Senator Keneally to reconsider this approach that she has taken and to join the Greens in our campaign for an immigration system with compassion, decency and respect for international law.

As I said yesterday, this latest iteration of offshore detention is a dark, foul and bloody stain on our country's history, and it's got to stop. I ask the government: when are you going to accept the offer from New Zealand? There are still people in Papua New Guinea and there are still people on Nauru. It has now been nearly seven years since July 2013. We'll be moving some motions in this Senate in due course to reflect that awful anniversary.

The government have a solution staring them in the face. It's a kind and generous offer from the New Zealand Prime Minister, Ms Ardern, to take 150 of these people each and every year into New Zealand and put them on a pathway to citizenship in this country. Of course, that is what Australia should have done because the overwhelming majority of these people have been found to be genuine refugees—that is, their claims for asylum have merit under the refugee convention and they were accepted as refugees; in other words, they had a well-founded fear of persecution in their home country. And by 'persecution' in some cases I mean death. If you are a gay man in Iran, you're probably going to be stoned to death or thrown off a tall building. Yet, what did we do when gay men from Iran asked us for help? We exiled them to Manus Island and we exiled them to Nauru.

Shame on the Labor Party for being the architects of this calamitous scheme and shame on the Liberal Party for running it in the most punitive and disgusting way. I was on Manus Island when the Liberal government ordered the cutting off of drinking water and food to over 650 desperate people. I will never forget that and I will ensure, to the best of my capacity, that the Australian people never forget it either.

Senator STOKER (Queensland) (13:22): We're debating the Migration Amendment (Regulation of Migration Agents) Bill 2019 and the Migration Agents Registration Application Charge Amendment (Rates of Charge) Bill 2019, but you'd never know that because most of the debate that has happened in this chamber about these bills has been about entirely unrelated matters. Senator McKim at least had the good sense to refer to some bits of the legislation, and I thank him for his contribution in that regard. But, golly, the Labor contribution was nothing short of irrelevant.

Let's talk about what this legislation actually does. It really is pretty simple. This government believes that we should impose the lightest possible amount of regulation on people who are in business, professions or anywhere in the Australian community while still ensuring that we have an appropriate amount of consumer protection. That shouldn't be a controversial proposal, yet up until the review that was conducted back in 2014 of the operation of OMARA, the office that regulates migration agents, those legal practitioners—in essence, registered lawyers—who also were registered as migration agents had to comply with two sets of regulation.

There's no real advantage to having lawyers who practise in the area of migration registered under two regulatory regimes. They both aim to do the same thing. In many respects the standards that are faced by legal practitioners under state regulation are in many ways more rigorous, yet there was a complaint levelled from Senator McKim on behalf of the Australian Greens that this is somehow a drop in standards. No. We're keeping legal practitioners subject to the very high standards that apply to legal practitioners under state regimes. Those penalties for failing to comply with the regimes in place for the regulation of solicitors, legal practitioners under state regimes, often involve civil compensation. They involve disciplinary action. They involve criminal action in many cases when the wrong thing has been done by a person seeking representation for migration work. So there's really no compromise in the standard that we're setting for people who want to practise in this area.

But we are doing something that's really important, something that aligns very well with our values: we are cutting the burden of government regulation. It's got to be an uncontroversial proposition. Why should somebody practising in this area have to comply with two regulation regimes when they could comply with one, noting that it is the one that imposes the higher standard of the two? It seems pretty common sense. Maybe that explains why Senator Keneally talked about everything else under the sun and not the bill—because anyone who'd read the bill would go, 'Well, that's actually pretty sensible.' So, for those people who operate in the industry, those people who will need to adapt to this regime, they might need a little bit more detail about how this is going to work.

I mentioned that this change comes out of the review of OMARA that was conducted in 2014. The No. 1 recommendation from that was that legal practitioners be removed entirely from the MARA regime—the migration agents regulation program at the Commonwealth level—and be entirely regulated by their state professional bodies. This bill implements that. There's been a lengthy consultation process, though, in between that report and the present time, and that means that stakeholders across the industry that provides migration advice have been engaged with at length. And the government's committed to continuing that engagement, particularly as the industry adapts to this new arrangement.

One big benefit that this will provide for people operating in the industry in circumstances where they've got a legal practitioner's practising certificate is that they're not going to have to pay the registration and licensing fees for two systems. At a time when many in business are doing it tough and people in the professions are doing it tough, to make it possible for those practitioners to pay one set of fees instead of two would, I thought, have been welcome from all political colours in this chamber. It should be uncontroversial that fewer fees, fewer burdens and fewer encumbrances to people getting ahead in business would be a good thing. But that's what the bill does; it makes it so that those people practising in the industry only have to face the levies, dues and registration fees for one regulatory regime rather than two.

It's really important to note, though, that consumer protection hasn't been forgotten. Lawyers who have practising certificates and who intend to practise in the migration advice field still have access to high-quality educational offerings through their professional associations, and they would retain access to the resources that are produced at the commonwealth level to help make sure we're getting quality advice in the migration field. It is also really important to notice that there will remain highly rigorous processes for consumers who have complaints to be able to get justice. They will be heard, investigations will be conducted and the only difference will be who is doing it. It'll mean that those people who aren't legal practitioners will be investigated by OMARA and those people who are legal practitioners will be investigated by the processes of state and territory law societies. And that's the way it's handled in the states at present in all complaints against a legal practitioner relating to every other field of advice.

In many ways it was a little counterintuitive that, just for those who deal with migration advice, complaints against a legal practitioner were dealt with in a place other than where they would be in every other field of law. field of law would be investigated against a legal practitioner.

People who are working in the industry, though, might be concerned about the way this bill will affect people who, early in their career, are on restricted practising certificates. For those who aren't in the industry, it's worth noting that when someone becomes a solicitor, a legal practitioner, they're put on a restricted practising certificate, usually for a period of two years. That means an experienced lawyer needs to supervise them in their work to help them adapt the ethical approaches and the good practice management practices—and in many ways the analytical rigour and even the self-care—associated with becoming a great contributor to the profession. But of course when you're in that phase you might, if you were to read this bill at face value, be confused about which regime you'd fall into under this new arrangement.

So, we've put in provisions to make it very clear. People who are in that early-career phase where they are supervised can remain on application covered by both regimes in that early period, and that will cover them up to the time when they are released from that supervision period. And that's something that can be arranged with OMARA. It's a commonsense, practical solution that deals with the fact that, as a matter of practicality, people are subject to supervision early in their career. It's worth noting, though, that the references in the bill to people who are subject to restricted practising certificates isn't a reference to people who are subject to supervision for disciplinary or misconduct reasons; that's treated very differently.

Future legal practitioners who have restricted practising certificates will be able to register with OMARA during the two-year eligible period if they've completed the graduate diploma on migration law and practice and the Capstone assessment that was introduced in 2018. Those were brought in to make sure that we are equipping the industry with high-quality practitioners who really know what they're doing and who are well equipped to help often vulnerable people in our community to get the quality advice they need and that we are equipping those practitioners to offer value for money because they really know what they're doing. Future legal practitioners who have not completed those requirements won't be registered with OMARA, but they will still be able to provide immigration assistance in connection with legal practice, and they'll be regulated by their legal professional and disciplinary body.

This is a measure that's been put in place to make sure that people in that early-career supervision phase don't suffer unfairness or hardship as a consequence of these changes. It really is a transition arrangement. An unrestricted legal practitioner, for those watching at home, is a lawyer who has got through that early phase of supervision in their career. They're allowed to be admitted as a lawyer, they're granted a legal practising certificate, they've completed their supervised practice and they've been granted that right to practice without supervision in their state. Once you've got that, if you're someone who's practising in the migration field, you'll be able to do so simply by following the disciplinary arrangements that are put in place by your state or territory legal professional regulation body.

This is a great opportunity to sing the praises of those bodies. I am a Queensland legal practitioner, a member of the bar—a proud member of the Queensland Bar Association—and I have been admitted as a solicitor in the past. While no profession is perfect, I can say with great confidence that the professional associations in Queensland invest heavily in the expertise, in the qualifications and in the good judgement and ethics of practitioners at all levels and work really hard to make sure that people who are practising, whether they're at the start of or towards the more senior end of their careers, have access to the kind of guidance they need in order to make good calls on behalf of members of the community who need help. I have great confidence that those professional associations will continue to do the great work that they do in relation to every other area of law and practice for regulating practitioners and making sure that they are ethical and ensuring that consumer complaints are investigated. I have great confidence that they will also do that well in relation to the field of migration.

The consequence, I suppose, of passing that responsibility over to the states might seem obvious, but I'll pop it on the record. That is, that the OMARA will no longer be able to investigate any existing complaints concerning Australian legal practitioners who are providing, or who have provided, immigration legal assistance and who are not continuing migration agents of a registered kind or former registered migration agents. People who have lodged those complaints will need to re-lodge them with state and territory law associations, and that means that from this point onwards there will be a separation of who investigates what. That makes sense; we don't need to expend Commonwealth resources on investigating things that will remain within OMARA's remit when we already have resources paid for and invested in by practitioners to be delivered at the state and territory level.

As somebody who is an enthusiastic federalist, it pleases me greatly to see more power and more responsibilities being provided back to the states and being provided back to the local professions, and being provided in a way that is decentralised from the Commonwealth. One of the benefits of doing that is competitive federalism. We get to see how things are done in Queensland and compare that to how it's done in New South Wales. Granted, there is a lot of collaboration between people in different states, but we can compare how things operate in Victoria, WA, South Australia or the Territory and harness the competitive natures of these professions to encourage them to do ever better in their provision of services to clients in our community.

Federalism offers many benefits, but seeing responsibilities handed back to the states and the state and territory associations, as this bill does, is consistent with those principles of competitive federalism, and it's consistent with our overarching commitment to always reducing the regulatory burden—always reducing the fees and charges that are faced by people in business and the professions, and always making it simpler and easier to go about your work and your life.

Senator BROCKMAN (Western Australia—Deputy Government Whip in the Senate) (13:37): I rise to give a brief contribution on this very important bill.

The government reintroduced a bill package to remove certain legal practitioners from dual regulation by the Office of the Migration Agents Registration Authority, the OMARA, on 27 November 2019. The bill package consists of the Migration Amendment (Regulation of Migration Agents) Bill 2019 and the Migration Agents Registration Application Charge Amendment (Rates of Charge) Bill 2019. The Migration Amendment (Regulation of Migration Agents) Bill 2019 contains measures to implement the recommendations of the 2014 independent review of the OMARA and makes other amendments to improve the effectiveness of the regulatory scheme governing migration agents. The bill removes legal practitioners with unrestricted practising certificates from the OMARA scheme such that legal practitioners will be entirely regulated by their state or territory legal disciplinary bodies. Eligible legal practitioners with restricted practising certificates will still be able to register with the OMARA for two years, which can be extended to four years.

The bill reflects the government's commitment to deregulation by removing the unnecessary administrative burden of dual regulation of lawyers, who are already subject to a strict professional regulatory regime. Legal professional bodies and the statutory schemes underpinning them apply a broader range of powers to resolve consumer related issues, including penalties outside the OMARA's jurisdiction. These penalties include financial penalties for improper conduct and recommending compensation for affected clients.

It's important to note that this bill was subject to extensive consultation with industry and key stakeholders prior to being initially introduced to parliament. It's very important to recognise that there is no evidence that removing any legal practitioners from the Migration Agents Registration Scheme would result in any reduced consumer protection. Lawyers who are no longer subject to OMARA's regulatory scheme will remain subject to a strict professional regulatory regime administered by their state or territory disciplinary bodies. I will leave it there, thank you.

Senator McMAHON (Northern Territory) (13:39): I'm very happy today to rise to speak to both the Migration Amendment (Regulation of Migration Agents) Bill 2019 and the Migration Agents Registration Application Charge Amendment (Rates of Charge) Bill 2019. Those of us on this side of the chamber know a key hallmark of good governance is the delivery of the means by which government structures and processes operate efficiently, not just our internal practices but also those areas where the Australian public must interact with our various departments and services.

This government made a promise to Australians that it would cut red tape and unnecessary costly duplication, and I commend the government for delivering on this promise. Additionally, these amendments reaffirm this government's broader commitment to deregulation across industry sectors. In my experience, as a veterinarian and small business owner, I have witnessed firsthand the impacts poor governance, overregulation and duplication have on small business. In this instance, we are addressing the convoluted registration practices and mandatory continuing legal education and migration agent compulsory education, and, on top of this, the unnecessary additional costs imposed on sole practitioners and small practices.

The amendments for both the migration bills we speak of today are designed to streamline the processes for restricted and unrestricted legal practitioners. Presently Australian lawyers are governed by the strict regulatory rules of each state's law society. Legal practitioners are considered to be either restricted or unrestricted. All legal practitioners are considered restricted within the first two years of admission and must be under the direct supervision and employ of an unrestricted legal practitioner. The restricted practitioner is required to be registered within the law society under the professional indemnity insurance of the practitioner. This structure serves to not only ensure the highest standards of service but also act as a safeguard for both client and lawyer. It delivers accountability and a mechanism for redress and sanctions if a legal practitioner's professional practice is called into question.

Following the restricted period, a practitioner may apply for an unrestricted certificate. To be successful, practitioners must first complete the relevant state law society's unrestricted practicing certificate course and obtain all relevant registrations and insurance. Furthermore, all unrestricted and restricted legal practitioners must complete 10 units of continuing legal education each year, the cost of which can be in excess of $5,000. Any firm that employs a solicitor must bear that cost on behalf of the employee, placing additional pressures on small businesses of two to five solicitors.

Currently, should a legal practitioner train and provide migration advice and services, they are required to do so under a completely separate registration stream that is, essentially, a duplication of the process I have just outlined for regular legal practitioners. With these amendments today we will remove the requirement for that second stream of registration and regulation of legal practitioners by the Migration Agents Registration Authority. In doing so we remove the burdensome and duplicitous chores of additional costs, training and further specialised compulsory legal education. This bill will ensure the removal of these unnecessary and costly requirements by recognising that the dual registration of restricted and unrestricted legal practitioners is an unnecessary administrative burden in circumstances where a strict professional regulatory regime already exists, which is subject to annual and random audit processes. This structure itself is good governance and duplication is unwarranted.

Upon passing of this bill, and pursuant to schedule 1, lawyers who hold unrestricted practicing certificates will immediately be removed from regulation under the Migration Agents Registration Authority and continue to be regulated by the relevant state or territory law society. Those legal practitioners who hold restricted practicing certificates will have a period of two years in which they may be registered as both migration agents and restricted legal practitioners. The clear intent is to provide reasonable opportunity for these practitioners to make any necessary changes to their business affairs and certification.

Once the eligible period has expired these practitioners will also be removed from the OMARA regulations, providing they complete the required programs to be eligible for an unrestricted practicing certificate within the guidelines of their respective state or territory law societies. Because the two existing registration streams are essentially identical, removal of one stream, in accordance with changes under this bill, will not water down any consumer protections. I commend the government for recognising the need for strong regulatory protections for the consumer, particularly those not engaging legal practitioners but instead registered migration agents. Registered migration agents already work to the highest standards and requirements in provision of competent migration advice, and the changes under this bill will not negatively impact upon this.

With the introduction of the Graduate Diploma of Australian Migration Law And Practice in 2018 this sector gained meaningful credibility. Those requirements replaced a five-day course, a course which was not to the standard needed of the profession and not to the standard that consumers deserve. Implementation of this recent qualification has served to ensure only applicants of high standards obtain the registration and also serves to mitigate the risk of neglect or poor advice.

The single most common inquiry my office receives is migration related. It is an extremely emotive issue, often involving families and people whose entire future is on the line. It is vitally important that these people who put their trust in an agent are assured of the quality of the information and advice they receive from that agent. Accordingly, pursuant to schedule 2 of this bill, the period an individual has in which to apply for repeat registration following the completion of the required qualification will be set in the legislation complementing the introduction of the graduate diploma, the qualifications of which never lapse. The existing system does not permit this streamlined process.

I also note this bill seeks to protect the rights of eligible applicants for registration as migration agents by removing provisions to refuse applications where an applicant fails to provide further information. Common sense dictates that not all circumstances are within the control of the applicant to respond to such requests in a timely fashion. Because this bill recognises that, incomplete applications will remain unfinished for an indefinite period, saving the applicant hundreds of dollars and time in reapplying.

Finally, this bill goes further in slashing unnecessary red tape by repealing certain provisions that reflect consolidation of the OMARA into the Department of Home Affairs. I'm pleased to hear that Labor is supporting this bill as they must hate it. Removing red tape and relieving burdens and fees on business is not in their DNA. They're usually doing quite the opposite. So I'm pleased that today at least they have seen fit to support Australian business. I commend this bill to the Senate.

Senator McDONALD (Queensland) (13:49): Today, I'd like to congratulate the Morrison government on practising what we preach when it comes to cutting red tape—this time in relation to the Migration Amendment (Regulation of Migration Agents) Bill 2019.

The bemusing situation of migration agents who are also lawyers having to register with their state government and the federal government is about as clear-cut as it gets when trying to address regulation in this country. The government has long supported the key measures in schedule 1 to the bill, which will see some lawyers practising in the migration field removed from unnecessary dual regulation by the Office of the Migration Agents Registration Authority—OMARA—and, instead, be subject to regulation by their relevant state or territory legal professional body. The amendments made by schedule 2 reflect the government's commitment to improving the entry-level standards to the migration advice profession through improving and streamlining the qualification requirements.

There are four more changes covered in this bill, and they are all designed to streamline a sector that is very important—especially to regional Australia. Without skilled migrants, businesses in my home region of North Queensland would be forced to close. From the tiny town of Coen in Cape York to the famous Nick's Restaurant in Yungaburra on the Atherton Tablelands or the Laura Johnson Home in Mount Isa, and in numerous cattle stations, cafes and pubs, international arrivals are constantly filling staffing shortages. Everywhere I travel in regional Queensland I'm told by business owners that without migrants things would be very grim indeed.

Last year, at the little town of Richmond, 400 kilometres west of Townsville, I met three young women from Estonia. One was pulling beers at a local pub and the other two were living on local cattle stations, working as general hands. It remains extraordinary to me that there are those people in this place and the other who don't understand that despite the extraordinarily high unemployment rates that we have in regional Queensland of over 20 per cent—and in Townsville, youth unemployment stands at 17 per cent, prior to COVID, I should flag—that despite these high unemployment rates, we still struggle to find employees to work in the most basic of roles. It has become a rite of passage for young people from around the world to travel to regional and outback Queensland and Australia to work in tourism and to work on cattle stations—and for what seems a large number of Irish people to work in regional pubs, where they see the summer at temperatures of between 40 and 50 degrees as something interesting and unusual to do. It is very difficult to find Australians to work in those roles.

In Mount Isa, at the Laura Johnson Home, many of the nurses hail from the Philippines and Sri Lanka, and the centre's manager regards them as virtually indispensable to care for those most vulnerable and elderly of our community. In fact, remote nursing homes at places like Doomadgee, Mornington Island and Normanton are all struggling to fill roles to care for many Indigenous and other Australians who desperately need a ratio of care to make these safe and comfortable places for them to live in. And yet each year those care facilities are forced to pay more and more for contract staff to come and spend some time in these very important communities, caring for these people.

Last year, at Coen, 428 kilometres north of Cairns, a couple from Argentina were out manning a local service station and general store. I've already mentioned Yungaburra on the Atherton Tablelands west of Cairns. Nick Crameri told me he couldn't operate without migrant workers in his kitchen and on the floor as waiting staff. It will probably surprise you, Acting Deputy President Walsh, that butcher shops and other meat-processing facilities across the country rely on skilled tradesmen coming from Africa and other parts of the world to fill these roles, because, in many cases, supermarkets, who now sell over 80 per cent of red meat in our sector, are not training. They're not putting through apprentices as butchers and slicers, so we rely on skilled migrants coming to work as smallgoods makers and in other highly skilled roles in the meat area.

It seems that we talk a lot about the jobs that Australians are looking for around the country, but regional Australia relies on those people who come out to experience the unique and interesting world that we have and to fill these roles that businesses would otherwise just not be able to manage. In Mount Isa, the cafes have a constant stream of young people coming through. They are providing the services and baking the cakes that keep Australians going in coffee shops and other service industries.

It is critical and crucial that the federal government continues to improve and streamline regulations in the migration space, but it must do so without compromising on measures to weed out some potentially rogue operators. I remember, in my time running butcher shops, some of the people who would come to me and tell me stories of migration agents who seemed to make the process particularly long and particularly expensive, which is not right, nor is it fair for those people who just seek to call Australia home. The Morrison government takes seriously its commitment to character and background checks for migrants and is now diligent in its scrutiny of these migration agents. This legislation, while still improving efficiency in this sector, compromises none of this, and that is why this is just one more piece of streamlining and red-tape removal that is so critical to our nation. We know that it is in regional Australia where we build our prosperity, and it is in regional Australia where we build industries where families grow and enjoy a lifestyle. That is why I commend these changes to the Senate.

Senator RUSTON (South Australia—Minister for Families and Social Services and Manager of Government Business in the Senate) (13:58): I thank all members for contributing to the debate on these bills. This package of amendments contains two bills, the Migration Amendment (Regulation of Migration Agents) Bill 2019 and the Migration Agents Registration Application Charge Amendment (Rates of Charge) Bill 2019. The Senate Legal and Constitutional Affairs Legislation Committee report, released on 27 February 2020, recommended the Senate pass the bills without delay. The 2014 Independent Review of the Office of the Migration Agents Registration Authority recommended, amongst other things, that legal practitioners be removed from the regulatory scheme governing migration agents. The regulation of migration agents bill draws from this recommendation.

The bill removes legal practitioners with a restricted practising certificate from the Office of the Migration Agents Registration Authority scheme. Eligible legal practitioners with a restricted practising certificate will be able to register with the Office of the Migration Agents Registration Authority during a 2-year period and can extend that for a total period of up to four years.

The PRESIDENT: Order! Senator Ruston, you will be in continuation when debate resumes.

Senator URQUHART (Tasmania—Opposition Whip in the Senate) (15:33): There was one document that was left off the Notice Paper earlier this week, which was the government response to the Senate Education and Employment References Committee report—Jobactive: failing those it is intended to serve. I move:

That the Senate take note of the document.

I seek leave to continue my remarks later.

Leave granted.

Senator SIEWERT (Western Australia—Australian Greens Whip) (15:36): I wish to take note of the document that Senator Urquhart re-established back on the Notice Paper, which is the government response to Jobactive: failing those who it is intending to servereport. This was a very important Senate inquiry, and we heard from particularly people that are participants in jobactive from service providers in terms of their experiences, and broadly members of the community.

I think that the committee raised a number of points and I think made a number of important recommendations. I will also note that the Greens submitted additional comments because we thought that the report should go further. We were disappointed with the government's response because this was an important inquiry. It raised a whole number of points. The response fails to acknowledge the significant evidence that we heard and, in particular, does not properly address the recommendations. It also denies that Jobactive is not fit for purpose. And, in fact, it is not fit for purpose and even more so during this pandemic and also coming out and during the recovery period, it is just not going to meet the needs of people who are looking for work.

The response doesn't acknowledge the problems and hurt caused by mutual obligations and the targeted compliance framework. For example, the committee recommended that the government look at transferring responsibility for compliance which at the moment is with the employment consultants, with the Jobactive providers. We recommended that that be transferred to the public service. This is an absolutely essential point because at the moment the requirement to fulfil the government's compliance work is actually eroding the trust between participants, jobseekers and the employment consultants.

I'm deeply alarmed that the government is planning to continue the mutual obligations and the targeted compliance framework as part of the new employment services model. Compliance does not lead to better outcomes for jobseekers and, in fact, the TCF is counterproductive and has a negative impact on jobseekers, in particular their mental health and wellbeing. It further entrenches disadvantage and poverty and in fact is leading to people dropping out of the system altogether.

I'm really worried that the new employment services model will not address these issues with job service providers, and let me tell you there have been a lot of problems with job service providers and my office has heard extensively about these problems. Despite mutual obligations being suspended, my office has been inundated with calls and messages during lockdown from people being harassed by job service providers. I've heard countless accounts of job service providers forcing people to sign job plans—the same old rubberstamp job plans that don't meet their needs, that are not individually focused. They've been told to undertake face-to-face appointments, for crying out loud, during lockdown and threatening to cut off people's income support payments—during the pandemic this has been happening; job service providers are doing this.

Here are some of the personal accounts we've heard from people struggling with their job service providers.

My DES—

the disability employment service—

has rung me every fortnight for a phone appointment. I have also had them texting me asking me to email my resume through even though they have one on file. I often get called two or three times a week asking me have I applied for jobs that they see. I'm a single parent with an autoimmune disease and I'm also immune suppressed.

Another mum newly on jobseeker was referred to and contacted by her JSP, who had her sign a new job search plan and release of information over an email. She was then phoned a fortnight later to see how her job search was going, even though mutual obligations were suspended. She also received another letter for a phone interview on the day she sent me this correspondence. She was asked whether she had found work. All of this contact has been during the suspension of mutual obligations. 'My mum is really confused by all this.'

'My job service provider here in Murray Bridge rang and told me that I had to do a four-day online course at home and, if I don't, I'll be forced to do it when mutual obligations are running again or face a 16-week penalty payment suspension.' That's just not true. 'I am a single parent with a child on an altered education program that begins at 10.30 each day.'

As you can hear from these—and I have got a lot more accounts of people's experiences—jobactive is not fit for purpose. It needs to be fixed, mutual obligations need to continue to be suspended and we need a new way of supporting people.

Senator PRATT (Western Australia) (15:41): I also take note of the government's appalling response to the report by the Senate Education and Employment References Committee entitled Jobactive: failing those it is intended to serve. It was a very comprehensive report detailing myriad problems in the government's job services framework. We got this very flimsy reply. The report had 41 recommendations. How did the government respond to them? It said under the heading 'Recommendations 1 to 41': 'Job seekers in jobactive report they are satisfied with the quality of services.' It's a pretty arbitrary quoting of statistics. For stream A jobseekers it is but 58.7 per cent of jobseekers who say they are satisfied. That's not 'extremely satisfied' or 'you're terrific'; that's just a basic level of satisfaction.

As Senator Siewert highlighted, the kinds of complaints that dog this system go to the very core of people's lives and their wellbeing. The jobseekers I speak to overwhelmingly tell me that they are not satisfied with the quality of services. ACOSS conducted a survey and found 73 per cent of jobactive participants were dissatisfied and only eight per cent were satisfied.

These are the kinds of things jobseekers say. In cases where they've acted in good faith, trying to engage with the provider they are allocated to by Centrelink, they have been ignored and not given any help finding work. Often that's because, as one example says, providers say to them: 'We don't get any money if we place you now. We'll wait another three months until you've been out of the workforce a bit longer and then we'll help you. Our contract is structured in such a way that we'll get a payment for placing you.'

In cases where appointments have been made with agency staff, there have been occasions when no-one has actually been there. The provider made the appointment and the jobseeker, who was obliged to go, went to their appointment and found that the office was closed.

People have told me that they were offered gift cards as an inducement to produce pay slips to their provider when they had gotten a new job and they had gotten that job off their own back. The provider who wanted to take credit and claim a payment for that job induced that person by giving them a gift certificate. They also tell me that their providers hold their jobseeker payment over them—as an overt threat—to get them to sign job plans or undertake unsuitable activity. So I do not accept the government's argument that jobseekers are simply satisfied with the employment services offering.

I think it is true that the service providers bear the brunt of having to implement this government's policies and so their behaviour is contingent on the policy settings put in place by this government. You have your hands on the policy levers. You've created a system where providers' primary focus seems to be administering the targeted compliance framework, ensuring mutual obligation at the expense of providing jobseekers with meaningful assistance to get them back into the workforce.

The government should be admitting right now that that system, as flawed as it was before, is even more flawed now. In a declining employment market what is the point of spending money to get people to comply to look for a job, particularly when you want to revert back to giving them a measly $40 a day in jobseeker payments. It is simply not going to work. We need employment services to be there to reinvigorate local economies and to be engaged with local employers. It should not be the primary remit of the employment service providers to enforce mutual obligation when it comes at the expense of finding jobseekers meaningful work. Now more than ever jobseekers in this country need an employment services system that actually works. I seek leave to continue my remarks later.

Leave granted; debate adjourned.