A FEW BIG FIRMS
SIR WALTER MURDOCH SCHOOL POLICY SEMINAR
WEDNESDAY, 7 JUNE 2017
I acknowledge the traditional owners of the land, the Whadjuk people, and thank Benjamin Reilly and the Sir Walter Murdoch School of Public Policy and International Affairs for inviting me to speak here today.
It’s great to be here on the left coast of Australia – particularly now that your state’s politics and geography are once again in alignment.
And it’s terrific to be in Perth, the city that the New York Times recently called ‘Hipster Heaven’.
It’s fitting that I’m giving this speech in Hipster Heaven because, although they may not realise it, hipsters play an important but often underappreciated role in competition policy.
The reason for this is simple. Hipsters don’t like the mainstream. They’re not happy unless their clothes are vintage, their bikes are fixies, and their flat whites are served in avocados. If it is mass-produced by a multinational, they won’t touch it.Read more
WHO SUPPORTS LABOR’S PLAN FOR A DIRECTOR IDENTIFICATION NUMBER, TO CRACK DOWN ON PHOENIX COMPANIES?
The list of organisations that support Labor’s proposed Director Identification Number continues to grow, with the Tax Justice Network signalling its support for this important measure to help catch dodgy directors of fraudulent phoenix companies.
Supporters of a Director Identification Number now include:
- Australian Institute of Company Directors
- Australian Small Business and Family Enterprise Ombudsman
- Productivity Commission
- Tax Justice Network
- Australian Chamber of Commerce and Industry
- Master Builders Australia
- Australian Council of Trade Unions
- Australian Restructuring Insolvency and Turnaround Association
- Phoenix Project, comprising experts from Melbourne University Law School and Monash University Business School
CHINA STORY YEARBOOK LAUNCH
AUSTRALIAN NATIONAL UNIVERSITY
MONDAY, 5 JUNE 2017
Let me start by acknowledging the Ngunnawal people, the traditional owners of the lands on which we meet today, recognising ANU’s Centre on China in the World for inviting me to speak here today, and thanking Shirley Leitch, Benjamin Penny, Jane Golley and the expert panellists for their thoughtful words.
When I look around Gerald Szeto’s beautiful China and the World building I am reminded of the explosion of modern architecture in China - or as President Xi Jinping calls them: ‘weird buildings’.
These are dotted across the country. They include the big pants, the space eggs, the big boxer shorts, the giant teapot and an assortment of buildings shaped like pianos, violins, lotus flowers, space caterpillars, doughnuts and mobile phones.
They make Canberra’s Shine Dome, Belconnen owl and Garema Place sheep look almost tame by comparison.
President Xi complained about this increase in ‘weird buildings’ in a speech not that long ago where he said that there are too many ‘big pants’ on the horizon. But funky architecture continues to proliferate, suggesting that even Xi Jinping can’t control everything.Read more
LABOR RECOGNISES OUTGOING CHARITIES COMMISSION HEAD SUSAN PASCOE
Labor acknowledges the service of the head of the Australian Charities and Not for Profits Commission, Susan Pascoe, who has not been reappointed by the Turnbull Government.
The charities commission was created by the Gillard Government in 2011, following numerous independent inquiries that called for such a body. Ms Pascoe was announced as its inaugural commissioner the following year.
In 2007, Ms Pascoe was appointed Member of the Order of Australia for service to education through a range of executive roles. She has won a number of significant awards, including the Outstanding Contribution in Public Administration Award last year. Ms Pascoe has been praised by the public service and charities alike. As advisory board chair Tony Stuart put it, under her leadership, the charities commission has ‘not only survived – but thrived’.
From 2011 to March 2016, the Coalition was committed to abolishing the charities commission. Despite the fact that the commission was established to reduce the reporting burden on charities, the Coalition used their first ‘red tape repeal day’ to attempt to abolish it. The Coalition even introduced legislation to parliament in an attempt to scrap the charities commission.
Surveys consistently show that four out of five charities support the Australian Charities and Not for Profits Commission. The body provides transparency for taxpayers, efficiency for charities and accountability for donors. Yet it took a concerted campaign, including a letter from more than 40 major charities, before the Coalition finally withdrew their legislation to scrap the charities commission. That uncertainty placed considerable stress on the organisation, which experienced up to 25 percent annual staff turnover during the time that it was slated for abolition.Read more
Vale Jayson Hinder
1 June, 2017
At the end of April, Canberra lost one of its great community activists, and briefly a parliamentarian in the ACT Legislative Assembly, Jayson Hinder. Jayson was a true son of Canberra. His family were the second to live in the Woden Valley, the first being Doug Anthony and his family. He had a tough childhood. When his father died in the 1970s, the family lost their home. But, as he grew up, he came to be a man who gave a great deal back to the community.
At his funeral service, many of his mates recalled his willingness to help out with fixing things. He was always there offering a hand and he loved his machines. He loved his cars and he loved his bikes. He loved fixing his own and he loved fixing the cars and bikes of friends. One friend of Jayson's described him as 'Toad of Toad Hall' for his love of feeling the wind in his hair. When he was profiled by Fairfax in 2015, Jayson owned a Ducati Monster, two BMWs, a 1973 Honda and a Renault Alpine.Read more
Matter of Public Importance
Wednesday 31 May, 2017
Last week we saw an orgy of self-congratulation as the Liberal Party of Australia recognised the 75th anniversary of Robert Menzies's 'The forgotten people' speech. But, sadly, those opposite appear to have forgotten to read the speech, because in that speech the founder of their party says: 'The rich can look after themselves.' Those that Sir Robert Menzies was concerned about were 'salary-earners, shopkeepers, skilled artisans, professional men and women, farmers and so on.' They have forgotten the forgotten people speech.
I do not have time today to refer to issues such as the fact that the party that once talked about homeownership is now the party of housing investors or that the party of schools and universities is now the party that brings down a budget cutting them. Let us just look at how Robert Menzies's forgotten people are being treated under the tax plans of those opposite. A member of parliament, who, according to the tax office's most recent statistics, earns an average of $215,000, will receive a $700 tax cut, but a flower-grower on $32,540 will receive a $162 tax rise. A cardiologist on $408,000 receives a $4,571 tax cut, but a fitness centre manager on $50,500 receives a $252 tax rise. A gastroenterologist on $380,000 receives a $4,000 tax cut, but a kindergarten teacher on $47,000 gets a $230 tax rise. A surgeon on $330,000 receives a $3,000 tax cut, but a nurse on $44,000 gets a $220 tax rise. While a magistrate on $250,000 receives a $1,400 tax cut, a hospital pharmacist on $68,000 gets a $344 tax rise.Read more
Treasury Laws Amendment (Accelerated Depreciation For Small Business Entities) Bill 2017
Wednesday 31 May, 2017
In 1936, John Maynard Keynes published The General Theory of Employment, Interest and Money, and one of the key insights of that book was to draw a distinction between the short run and the long run. In the short run, Keynes pointed out that it was important to have policies that would get the economy out of a temporary slump, such as that the world was in the mid-1930s. It could either be monetary policy or fiscal policy, but where it was fiscal policy he urged that it might be important to put in place temporary measures that encouraged businesses to invest over the short term to get the economy out of a hole. Keynes distinguished this from measures that might be put in place to boost long-run aggregate demand. Those measures would seek to be stable and predictable; they would not have sudden death thresholds.
Today, the House is facing a measure which, frankly, would be better crafted to get the economy out of a temporary slump than to feed long-term demand. In its policy on accelerated depreciation, the government has chopped and changed over the years. In office, Labor put in place a higher level of instant write-off, increasing the threshold from $1,000 to $6,500—a stable and sustainable level which we felt would do a great deal to encourage investments by firms. Accelerated depreciation has good economic insights behind it. By acceleration depreciation schedules firms have a greater incentive to purchase fixed assets for their businesses. Under the expenditure tax laws in place in Australia, the GST allows you to write off inputs in the same year as you pay the tax, further up the chain. But, in the case of company tax or personal tax, the items are depreciated over succeeding years. Accelerated depreciation tips the hand of a business owner towards putting in place investment that they might not otherwise have done. It is, in the view of many economists, a more efficient way of incentivising investment than changing the corporate rate.Read more
ASIC Supervisory Cost Recovery Levy Bill 2017
Tuesday 30 May, 2017
I rise to speak on the ASIC Supervisory Cost Recovery Levy Bill 2017 and related bills. Labor is supportive of the Australian Securities and Investments Commission industry funding model on the principle that ASIC's regulatory costs should be borne by those entities it regulates. Under this model, in the 2017-18 financial year ASIC's regulatory costs will be recovered from the corporate sector and the financial services sector instead of being borne by the taxpayer. These costs are anticipated to be $240 million in 2017-18. The opposition notes that the cost recovery levy is similar to the arrangements currently in place for funding the Australian Prudential Regulation Authority.
The principle that regulation is paid for by the entities that have created the need for it rather than by the Australian public is uncontroversial. Reflecting ASIC's function as the corporate regulator, the levy will apply to all companies and in 2017-18 is expected to raise $81 million, with costs ranging from $5 a year for small proprietary companies to $662,000 for listed public companies with a market capitalisation above $20 billion. Reflecting ASIC's function as the financial services regulator, additional levies will apply to entities in the financial services sector, and these levies are expected to raise $159 million from the financial services sector in 2017-18. We note that some existing ASIC fees, the government has foreshadowed, will be reduced in lieu of the cost recovery levy.Read more
ADDRESS TO 2017 PROPERTY LEADERS SUMMIT
TUESDAY, 30 MAY 2017
I've spoken at least half a dozen times to various Property Council events and very much value the conversation. Labor’s policies on housing affordability have been shaped through ongoing conversations and engagement with the sector. You may not agree with everything that we have to say, but I trust you won’t ever fault our degree of engagement with the business community. We understand the importance of the work that you do and the importance of continuing to have those conversations, when we agree and when we disagree.
We’re meeting at a challenging time for the housing sector. We’ve now got the home ownership rate lower than it’s been in 60 years. We’ve got housing debt to household income at a historic high, more than 180 per cent. At a time when the growth rate of living standards has halved, we’ve seen some of the most rapid house price appreciation in Australian history. That’s left a degree of fragility in the system. According to Reserve Bank Governor Philip Lowe, the share of households with debt more than three times their income was 12 per cent in 2002. Now it’s 20 per cent.Read more
‘YOU CAN ALMOST REGISTER YOUR DOG AS A COMPANY DIRECTOR’
Australian Tax Office Commissioner Chris Jordan this morning has confirmed the need for action on dodgy phoenix operators, who deliberately burn companies in an attempt to avoid their obligations to employees, taxpayers and honest businesses.
The Tax Commissioner told a Senate Estimates Committee:
“This is not a new issue. Phoenixing is a big problem, especially when you have these people that are unassociated with the principals. You can’t keep track.”
When speaking on how easy it is to become a company director in Australia, Mr Jordan told one Senator:
“I could appoint you as a company director without you even knowing and me then controlling the company”
The Tax Commissioner also noted that in other countries, proper identification checks are required for anyone wanting to become a director.
Illegal phoenix activity costs our economy billions of dollars annually. That’s why Labor last week announced measures to crack down on dodgy directors:
- Requiring all company directors to obtain a unique Director Identification Number with a 100-point identification check.
- Increasing penalties associated with phoenix activity
- Introducing an objective test for transactions depriving employees of their entitlements
- Clarifying the availability of compensation orders against accessories
- Consulting on targeted integrity measures based on the recommendations of the Melbourne Law School / Monash Business School Phoenix Research Team recommendations.