Andrew Leigh

I spoke in parliament today about dental health, and the government's proposal to replace an inefficient and expensive scheme with a more targeted and effective one.

Dental Benefits Amendment Bill, 10 October 2012

I rise today to speak on the Dental Benefits Amendment Bill 2012. In this context it is worth noting that human beings are the only species that smile to signal happiness. It is an evolutionary quirk that is unique. It is an integral part of being human. All of us in this place, whatever our political stripes, trade on those smiles. It would be a strange-looking political website and an odd-looking corflute that did not have a picture of us beaming happily at our constituents. That smile is such an integral part of human relations. But just imagine if the sight of your teeth made people recoil from you. Imagine the isolation, the sense of embarrassment and the erosion of self-esteem.

There are many things that divide us in this place, but I think we can all agree that the importance of healthy teeth is one that can unite us. I wrote in June last year in the Australian Financial Review on the relationship between teeth, economics and poverty. There has been plenty of speculation in the literature on the relationship between dental health and earnings, but few studies have actually managed to demonstrate causality. There is a new paper out though titled 'The economic value of teeth' by Columbia University researchers Sherry Glied and Matthew Neidell. They looked at the effect of fluoridation in the United States. Fluoridation was primarily driven not by the quality of people's teeth but by local politics. We see that very much in the differences in fluoridation rates across Australia, with Queensland holding out for so long on fluoridation to the detriment of the teeth of Queenslanders.

The study found that if you grew up drinking fluoridated water you are more likely to have all of your teeth as an adult. So using that natural experiment the researchers then went on to look at the relationship between good teeth and high earnings. They found that women who drank fluoridated water in childhood earned more than women who did not, and the positive effect of fluoridation was concentrated among those from the most disadvantaged backgrounds. The effect was large. The estimate is that losing one tooth cost the typical woman three per cent of her hourly wage, and you can imagine how that adds up. Four teeth means 12 per cent of your hourly wage. Now you are talking about an effect that is starting to be of the magnitude of gender discrimination.

The study looked into why it is that bad teeth mean low earnings and concluded that it was largely due to people being discriminated against by employers and unable to work in those customer service occupations. I will talk later in my speech about some of the personal stories from my electorate of individuals whose poor teeth have impacted them in the labour market. Those bad teeth are probably one channel through which physical beauty affects wages. This suggests that, if you care about reducing earnings inequality and raising the earnings of low-wage workers in Australia, a key thing you can do that is improve dental care.

But the historic trend has been in the opposite direction. The University of Sydney's Edmund FitzGerald looked at whether people had visited a dentist in the previous 12 months. He found that, among teens from affluent households, the share who saw a dentist has stayed steady at about three-quarters of the population since the 1970s. But, when you look among the poorest teens, the share who had seen a dentist dropped from 56 per cent in 1977 to 33 per cent in 2005.

Another disturbing demographic trend was noted by the Brotherhood of St Laurence in their 2011 report End the decay. They cited data out of the Australian Research Centre for Population Oral Health showing that children in low-socioeconomic areas have 70 per cent more decay in their teeth than those from affluent areas. It showed that children from poorer families with oral health issues go on to be adults with bad oral health—and, as I have discussed, unless treated bad oral health leads to serious employment and economic consequences.

The Australian Institute of Health and Welfare in another one of their terrific reports, their Child dental health survey, highlighted the following facts: the oral health of children has been declining since the mid-1990s; almost 20,000 children under the age of 10 are hospitalised each year due to avoidable dental issues; by the age of 15, 60 per cent of children have tooth decay. While untreated decay and fillings are similar across income ranges, there are substantial differences in the number of teeth—if you earn more than $60,000, on average you will have seven more teeth than Australia's poorest people, those who earn less than $20,000; 45 per cent of 12-year-olds have decay in their permanent teeth; and in 2007 just under half of children aged six who attended school dental services had a history of decay in their baby teeth.

End the decay cited the research of Stephen Leeder and Lesley Russell, who found that the total direct costs and lost productivity in Australia from poor dental health were in the order of $2 billion annually and every year there are a million lost workdays in Australia due to oral health issues. Data from the United States estimates that, for every 100 employed persons, 148 work hours a year are lost due to dental problems. In an Australian workforce of more than a million people, with an average full-time weekly wage of $1,340, that implies a productivity cost of more than $650 million per year. So each of these reports has shown that poor dental health is not just an equity issue and not just a health issue but also an economic issue.

In 2009 the Australian Research Centre for Population Oral Health found substantial disparity across public dental patients, who were three times more likely to have fewer than 21 teeth compared with the national average. For other conditions such as decay and periodontal pockets, the most disadvantaged suffered at twice the rate of the general population. All this highlights the human aspect of good oral health, and this government is taking action to address this. The government has been trying to shut down the Chronic Disease Dental Scheme since 2007 because we want to replace it with more effective policies.

The Dental Benefits Act currently provides dental checks for 12 to 18 year olds under the Medicare Teen Dental Plan. This bill will extend eligibility for children to receive dental services to those aged from 2 to 17. The Child Dental Benefits Schedule replaces the Medicare Teen Dental Plan, from 1 January 2014. It includes a schedule of basic dental prevention and treatment services up to $1,000 a child over a two-year period. For over three million Australian children going to the dentist will now just be like seeing a GP. You will be able to present your Medicare card and get basic dental work done. That can be done at private dental clinics or through public dental services. As well as the existing check-up, it will now be possible to get a descale and clean, fissure sealants and basic restorative work, importantly, including fillings.

There will be more services and more dentists where they are needed most, outside the capital cities and in large regional centres, such as the one you, Deputy Speaker, represent. We are putting in place $225 million for dental infrastructure to support expanded services and an additional $1.3 billion towards state-run public dental programs. And we are requiring states to maintain the existing level of dental funding, because we do not want them to take out their money as we put in additional resources for this needed group. That will fund 1.4 million additional services for adults on low incomes, including pensioners, concession card holders and those with special needs.

Earlier this year I sent out a letter to dentists in my electorate asking for their support with the Dental Support Program. It is a program run by the Salvation Army to help low-income Canberrans who sought food assistance and have untreated dental problems. Evaluation of that program has shown that clients who received treatment through the program reported increased confidence and self-esteem in employment and social situations. I wanted to call on my local dental community to put in pro bono hours to support those who would not normally seek out a dentist. Some dentists already do that important pro bono work, but I wanted to reach out to all dentists in my electorate and ask them for a few hours of their time. This initiative came from Liz Dawson, who is an extraordinary Canberran and a tireless worker for the Canberra community. She has worked for the Salvation Army and through the Common Ground project, for which her advocacy yesterday extended to bailing up the Prime Minister at a Canberra breakfast. She brings tenacity and passion to her advocacy for those from less fortunate circumstances. I remember Liz telling me about a client who came to her four years ago who had only one tooth in her top jaw. Liz's work ensured that the woman got the dental care she needed, dental care that in some cases can be life changing.

The Prevention and Population Health branch of the department of health has linked poor dental health to inadequate nutrition, diet related ill health, cardiovascular disease and some cancers. Individuals who are using illicit drugs sometimes say they first started doing so just in order to take away the pain of their aching teeth.

Malcolm Gladwell, in an extraordinary New Yorker article, described the process of tooth decay—see if this makes the hair stand up on the back of your neck. He writes that the cavity blossoms as it enters the dentin. When it hits the centre of the tooth an insistent throbbing begins and the tooth turns brown. Left unchecked the tooth eventually becomes soft enough that the dentist can reach into a cavity with a hand instrument and scoop out the decay.

While Australia has a strong health care system, it is much less effective for those with dental health problems. If we had our time again it would have been the right decision, I think, to bring dental care into the Medicare system. But that is a horse that I believe has bolted. Now, the challenge for us in this place is to improve the quality of dental care for the neediest.

Before we means tested the private health insurance rebate, Australia had the absurd situation of where high-income Australians, like those of us who serve in this place, had our health care and dental care subsidised to the tune of 30 per cent. Millionaires were receiving a 30 per cent subsidy on their dental care, but low-income Australians could not get to the dentist. We are starting to change that by putting in place targeted reforms—not the untargeted Chronic Disease Dental Scheme that now costs about as much per month as it was originally projected to cost per year, but a scheme that is directed to those most in need.

I remember the dentist who came into my electorate office. I asked him how he felt about the Chronic Disease Dental Scheme. He told me it had to go. He told me the story of a patient who had been referred to him by a doctor on the basis that the patient, who was very well-off, was undergoing some dental work and the  doctor thought this scheme could help him meet the costs. The dentist was outraged by this and went to the doctor and asked, 'Why are you referring patients who are not needy to me?' The doctor said, 'Well, that's not your business. I sign the form; you do the work.' That is the kind of scheme that the Chronic Disease Dental Scheme was: a scheme that did not go to the neediest. What we are doing with this bill is in the spirit of what we are doing with our multibillion dollar mental health package, with the National Disability Insurance Scheme: recognising that healthcare to be more holistic than it has traditionally been.

Our oral health as children is the best predictor of our oral health as adults. And because dental decay among children has been on the rise, we need to do something about it. One in five of the lowest-income earners in Australia have not been to the dentist in the last five years. Some of them may never have been to the dentist. By replacing the Chronic Disease Dental Scheme with the Child Dental Benefit Schedule we are addressing the cost overruns, the over-servicing, the rorting and the administrative problems associated with the Chronic Disease Dental Scheme. It will make sure that we have better dental health for low- and middle-income families, particularly children. I commend the bill to the House.

I spoke in parliament yesterday about the recent laying of National Broadband Network cables in Palmerston, and the benefits of the NBN for health, education and business.

Benefits of the National Broadband Network, 9 October 2012

Last week Senator Kate Lundy and I attended the laying of the distribution fibre cable in Palmerston, in my electorate of Fraser. NBN Co. forecast that construction should be complete in the central business district of Gungahlin and nearby suburbs by the end of the year. Homes and businesses in Gungahlin are now one step closer to connecting to the National Broadband Network and being able to access faster, more affordable and more reliable broadband. This will not only boost internet speeds but also strengthen the local community.

One example of where the NBN is strengthening community is in the lives of those suffering from a chronic health condition. In New South Wales, Hunter Nursing is using the National Broadband Network to remotely monitor the health of patients suffering from one or more chronic diseases. A trial of 50 high-risk patients using an in-patient home device with an online interface enabled them to have their health monitored in their own home by health professionals. Through high-speed broadband, patients and carers were able to use their device to access monitoring equipment and communicate with health professionals via video-conferencing and email. The benefit of this was that patients enjoyed one-to-one care in the comfort of their own homes. They could monitor their own health status and they could maintain their independence.

Ann Maree Battersby, one of the nurses who participated in the trial, commented:

'It gives [patients] increased security; they feel they have access to the nurse without having the nurse physically visit them in their home.'

Sally Bradley, granddaughter and carer for one of the patients in the trial, said:

‘The main benefit for us is in letting my grandmother still live at home and maintain her independence.’

This kind of innovative application of technology assists those living with chronic illness in the Fraser electorate. The Gillard government has provided over $1 million to the ACT Gallagher government to ensure that NBN services are available in the Gungahlin community as soon as the rollout is complete.

In July this year I was pleased to announce the Gillard government had already provided $360,000 to the ACT government for NBN services that would put people in touch with local government. When the project comes online Gungahlin residents will be able to engage with ACT Legislative Assembly members and government officials via interactive video platforms. The project will also provide the necessary infrastructure for new online services and forums as the NBN is rolled out.

Personally I am also excited about the opportunities the NBN opens up in education. Superfast broadband will enable students to video link with schools overseas, share classroom experiences and learn other languages in real time. For students using facilities in the Gungahlin library the NBN will mean the quality is similar to watching a DVD. I am an optimist who believes in the power of innovation and technology to meet today's challenges and to seize tomorrow's opportunities.

In today's AFR, I have a piece on inequality and superannuation.

Superannuation Inequity Needs Redressing, Australian Financial Review, 10 October 2012

Wealth in Australia is more unequally distributed than incomes. That’s largely because those of us on higher incomes are able to save more than disadvantaged Australians. This becomes a wedge over the course of a lifetime. By the time rich and poor people reach retirement, those at the top of the distribution have contributed more, and earned more returns on their contributions.

Since the Commonwealth began paying pensions in 1909, a central purpose of retirement incomes policy has been to prevent poverty among the elderly. When the Keating Government introduced universal superannuation in 1992, the boost was primarily for low and middle-income earners, since many high-wage workers already had more than 9 per cent of their wage directed into superannuation. Similarly, the Gillard Government’s decision to boost contributions to 12 per cent will have its greatest benefit for low-wage workers.

In an article for this paper yesterday, Senator Mathias Cormann made the unfortunate decision to continue the Opposition’s scare campaign on superannuation. This is a pity, since the issues aren’t inherently ideological. It was President George W. Bush who sought to establish ‘private accounts’ for the US Social Security system, a system similar to Australian superannuation. In other countries, conservatives have supported retirement savings schemes that focus on looking after the poorest.

Underpinning superannuation policy is strong economic evidence that myopia causes most of us to save less than we need in retirement. But as Brian Toohey has noted in a series of columns for this newspaper, superannuation policy needs to become more equitable. One of the policies to achieve this – championed by Minister Bill Shorten – is the Low-Income Superannuation Contribution, which cuts contributions tax to zero for workers earning up to $37,000 and puts the money into their super instead.

Another reform is the creation of MySuper default products. In shaping superannuation in the 1990s, policymakers focused on giving workers as much choice as possible. Yet two decades of experience – and advances in behavioural economics – has taught us that the typical worker ends up in the default fund and the default investment plan. MySuper ensures that default plans are good plans, and that a smaller share of workers’ earnings ends up in management fees. The Government is currently looking at the process by which superannuation funds are named in modern awards.

Boosting superannuation for low-income workers isn’t just a good way of reducing wealth inequality; it’s also one of the most important reforms for reducing gender inequity. Although women’s wages are four-fifths of those of men, women’s superannuation payouts average one-third of men’s (a gap that particularly hurts single women). Two-thirds of those who benefit from the Low-Income Superannuation Contribution are women.

Like me, Senator Cormann enjoys the benefit of a parliamentary scheme that contributes 15 per cent of our incomes into superannuation.  Yet the Coalition opposed the increase in superannuation contributions from 9 to 12 per cent. What’s good for the pollie should be good for the voters.

Andrew Leigh is the federal member for Fraser, and his website is www.andrewleigh.com.

I appeared on Lateline on 5 October 2012, speaking about the increasingly scratchy tone of debate in Australian politics; the way that Labor policies such as paid parental leave, equal pay and superannuation have helped women; the strength of the Australian economy; and Labor's decision to replace a badly-targeted dental policy with a better one. A transcript is here.http://www.youtube.com/v/BL1NS8OvKKs?version=3&hl=en_GB

I was delighted today to join Senator Kate Lundy at the laying of a distribution fibre cable in Palmerston -- bringing the National Broadband Network to the heart of Gungahlin.



Our joint media release is below.

JOINT MEDIA RELEASE

Senator Kate Lundy
Senator for the ACT

Andrew Leigh MP
Federal Member for Fraser

4 October 2012

NBN rollout picks up speed in Gungahlin

Senator for the ACT Kate Lundy and Member for Fraser Andrew Leigh MP today welcomed construction activity connecting Gungahlin residents to the National Broadband Network (NBN).

Construction crew will rollout the first NBN fibre optic cable today to link homes and business in Gungahlin to the NBN.

Senator Lundy said the NBN will deliver fast, affordable, and reliable broadband to over 15 000 Canberra homes and businesses, including 2 700 in Gungahlin.

“The roll out of fibre in Gungahlin means homes and businesses are one step closer to connecting to the NBN and accessing services and other benefits,” Senator Lundy said.

“The NBN will not only provide a massive boost to internet speeds, it will provide a huge boost to our local community.”

Senator Lundy said with the fibre hauling commencing today, NBN Co forecast that construction activity should be complete in the central business district of Gungahlin as well as nearby suburbs by the end of the year allowing homes and businesses to connect shortly afterwards.

The Gillard Government has provided over $1 million to Gungahlin Library through the ACT Government to ensure local individuals and businesses can access training opportunities and connect with local services using the NBN in publicly available facilities.

"I'm particularly excited about the opportunities the NBN opens up in education," said Dr Leigh.

"With super fast broadband, students will be able to video link with schools overseas and share classroom experiences to learn other languages in real time. Guest lecturers can present to a university class through a feed from another country and take questions from students. Rather than today's slightly grainy and patchy quality of services such as Skype, the NBN will mean the quality is similar to watching a DVD.

"There are also enormous economic benefits in increased productivity. Businesses will be able to upload and download enormous files quickly. It means the person running the small production company can email a draft version of an ad, rather than posting a DVD or waiting until a meeting to screen it.

"I call on the Liberals to abandon their tin-can-and-string policy, and support Canberrans getting super-fast broadband."

My La Trobe University chat with moderator Robert Manne and Greens MP Adam Bandt ('The Future of the left in Australia: Labor and the Greens; friends or enemies?') is now available as a podcast via ABC Radio National Big Ideas and a vodcast via Slow TV.

On Sky AM Agenda, I spoke with host David Lipson and Liberal MP Kelly O'Dwyer. We discussed budget measures (including Labor's focus on efficiencies over the Coalition's job cuts), the resurgence of closed-economy thinking in the Coalition, and Labor's important achievements over the past five years.

In today's AFR, I have a column on why inequality matters.

Take the test, which society do you prefer? Australian Financial Review, 26 September 2012

To see whether you care about inequality, take this simple test. Suppose you had an equal chance of being born into any of the five wealth quintiles in Australia. Would you prefer to be born into a society where the share of wealth held by each of the quintiles was 1%, 6%, 12%, 20% and 62%? Or a society where the shares were 15%, 17%, 20% 24% and 24%?

Actually, I’m cheating, because I already know the answer. The first set of numbers is the actual distribution of wealth in Australia: 1% for the poor and 62% for the rich. But when surveyed about their ideal distribution of wealth, respondents almost universally want a more egalitarian distribution. Indeed, the figures I’ve shown are the wealth distribution preferences of the most affluent, who thought that the poor should have 15% of wealth, and the rich 24%.

So while I enjoyed Christopher Joye’s thoughtful column on inequality (AFR, 25/9), his view that we need a wider gap between rich and poor is definitely a boutique one. Asked to choose between the level of inequality in Australia and the United States, the vast majority of survey respondents opt for the Australian level.

As Treasurer Wayne Swan might put it, being Born in the USA seems appealing for those who get to drive a Pink Cadillac, but things look different for those in the Badlands and Backstreets. There is much to admire in the way that the US fosters great entrepreneurs like Elon Musk, Marissa Mayer and Sergey Brin; but we must remember that the US is also the country that jails two-thirds of black high school dropouts, and where life expectancy for low-educated white women has fallen by five years over the past two decades. Inequality may not cause these bad outcomes, but the fact is the US is a dreadful place to be destitute.

Christopher Joye asks why we have progressive income taxes when we don’t handicap sportspeople. A glib answer is that Australian sport is replete with handicapping, from the different weight saddlebags in the Melbourne Cup to the salary caps that characterise most of our sporting contests. As many English soccer fans can tell you, too much inequality makes for a dull sport.

In the case of progressive income taxes, we ask the rich to pay a higher share of their incomes in taxes because they have more discretionary income than the poor. Put another way, the richer you are, the more capacity you have to fund our schools, army, hospitals, and pensions. And while it is true that higher-income people like Joye and me are lighter users of the income support system, we tend to be heavier users of other public services, including universities, roads and airports.

The flipside of progressive taxes is that government cash payments should be means-tested. I’m agnostic about whether $250,000 classifies you as ‘rich’, but I’m pretty sure that it means you don’t need to be on welfare.  And yet when our government has imposed means-tests on household payments and tax breaks, we heard an outcry from the Opposition (a reminder that they’re the heirs to those who opposed asset-testing the pension in the mid-1980s).

Australia is fortunate to have less inequality than many other nations, and to have seen a small drop in inequality over recent years. But the gap between rich and poor has grown markedly since 1980, with the top 1 percent doubling its share, and the top 0.1 percent tripling its share. And yes, inequality boosts growth, but it trickles down slowly.

Surveys prove that Australians care about inequality, and a plethora of economic experiments have shown that people are willing to pay to narrow the gaps between the rich and the rest. I can understand why Joye disapproves of envy, but as an economist, I’m surprised he would dismiss it as ‘irrational’. What brings us happiness isn’t just our own incomes, but also the wellbeing of others. Some people might find envy distasteful, but it’s no more irrational than altruism.

As ACTU researcher Matt Cowgill has pointed out, we should be sceptical of those who argue that it’s possible to worry about poverty but ignore inequality. What we define as a reasonable standard of living is invariably based on the wellbeing of the typical household. Someone who says they don’t care about inequality isn’t just saying that we shouldn’t worry about those at the front of the pack – they’re also saying that we needn’t worry how far the most disadvantaged have fallen behind.

Andrew Leigh is the federal member for Fraser, and a former professor of economics at the Australian National University. He is currently writing a book about inequality.

I've had some queries over the last day about why I didn't vote on gay marriage yesterday afternoon.

I was absent from Parliament because my wife gave birth to our third son yesterday afternoon. To avoid any confusion on this issue, I put out the below statement this morning. Gweneth and I, as well as Zachary's two elder brothers, are all very excited about the new addition to our family.

MEDIA STATEMENT

Andrew Leigh MP

Member for Fraser



20 September 2012



LEAVE FROM PARLIAMENT

Andrew and Gweneth Leigh's third son, Zachary Keith Leigh, was born on the afternoon of 19 September.

Andrew is on parental leave from Parliament on 19-20 September.

Pairing arrangements did not apply to the conscience vote on same-sex marriage. Andrew has spoken in support of same-sex marriage on multiple occasions, and would have voted in favour of yesterday's motion.

I spoke in parliament tonight about the proposed Australian Charities and Not-for-profits Commission.

Australian Charities and Not-for-profits Commission Bill, 17 September 2012

It is my pleasure to speak on the Australian Charities and Not-for-profits Commission Bill 2012. Strengthening Australian community life is a great passion of mine but it is an area which, in recent decades, we have sadly seen go backwards. I am going to do a little auto-citation, for which I apologise. In a book called Disconnected that I wrote a couple of years ago, I said that pretty much whichever way you cut it Australians are less involved in formal organisations than they were a generation ago. If you ask individuals whether they are active members of an organisation, you find that in 1967 33 per cent said yes but by 2004 just 18 per cent said yes.

If you look at the Directory of Australia Associations, the so-called bible for Australian associations, you find that the raw number of Australian associations has not kept pace with the Australian population. From the 1970s to 2010, the number of associations in that directory fell from 7,000 to 4,300. Put another way, there were about seven associations per 10,000 adults in the late 1970s and less than three associations for every 10,000 adults by 2010. That means that the associations we have are older than they once were. In the late 1970s, the typical association was about 22 years old; now, the typical association is about 39 years old.

We are not growing new associations the way Australia traditionally has—the way we did in the 1950s and 1960s, when we saw the birth of the Endeavour Foundation, Community Aid Abroad, Brisbane's Blue Nursing Service, World Vision Australia, UNICEF Australia, the Scout Association of Australia, Choice and International Pen Friends, to name just a few.

If you ask the associations themselves, they tell you they are shedding members. The RSL, Scouts, Guides, Rotary, Lions, the Mothers' Union—if you put together what these organisations are reporting back, it is possible to track an index of organisational membership. Compared with 1950, membership was down by 14 per cent in 1980 and was down a full 67 per cent by 2009. So it is vital that we as policymakers do what we can to increase the strength of Australia's organisations.

As a member of parliament, I take great pleasure in being involved in the associations in my local community. Just looking back through my diary for the last fortnight, I have been involved with Micah Challenge; People Power; the Canberra Times Fun Run, which raised money for a range of different charities; the University of the Third Age; and Care Australia.

Australia's associations need a system of regulation which is as good as we can provide for them. The Australian Charities and Not-for-profits Commission is aiming to be a one-stop shop for Australia's charities. The notion of the Australian Charities and Not-for-profits Commission is that charities and not-for-profits will provide their information once to a single organisation. That organisation which will then pass that information on to other Commonwealth agencies, including the tax office. Once we get buy-in from states and territories, it will also be passing that information on to state and territory government agencies as well.

This is what past reviews into the sector have called for. As the inquiry into the bill by the House Standing Committee on Economics noted, there have been five major reviews into regulation and taxation of the sector since 2000—the inquiry into the definition of charities and related organisations in 2001, the inquiry by the Senate Standing Committee on Economics in 2008, the Henry review in 2009, a Productivity Commission review in 2010 and a Senate Economics Legislation Committee inquiry, also in 2010. All those reports recommended a single national regulator for the sector. It is a straightforward approach and one which would bring Australia into line with other jurisdictions. As the report points out, the United Kingdom, Canada and New Zealand have this same sort of single regulator. Moving towards a single regulator is good for the growth of the charitable sector. If we want to, we can squib this reform, as previous parliaments going back to 2001 have—that was when the first inquiry recommended such a one-stop shop for charities. But, if we do that, we would be doing Australia's charities a disservice and we would be continuing the red-tape burden which falls upon them.

As was pointed out by witnesses to the inquiry, the not-for-profit sector already has a regulator—by default. It is called the Australian Taxation Office. The Australian Taxation Office is not particularly pleased about this and many charities are not particularly pleased by it either. It has strained the relationship between charities and the Australian Taxation Office. But let's not pretend, as the member for Menzies has attempted to do, that there is no additional red tape being imposed upon Australia's charities. We heard a great deal of evidence from charities about the burden of having to provide the same information to multiple government agencies and about grant requirements which are subtly different and so require charities to employ people to provide information to government agencies—when they could otherwise be increasing their expenditure on front-line services.

So this notion of the charitable passport is enormously appealing and will allow us to continue to grow the sector. As the report notes:

‘The current regulatory framework for the sector is fragmented, inconsistent, and uncoordinated across a range of government agencies.’

The report went on to note that it is vital we cut the level of red tape within the sector. The Treasury submission to the inquiry said:

‘For some entities the reductions [in red tape] will happen immediately, particularly those entities that are regulated at the Commonwealth level.’

The Treasury submission went on to say that those entities will see a reduction in their red-tape and compliance costs.

Reducing multiple reporting is absolutely critical. The Community Council of Australia said:

‘I do not think people quite realise how often charities have to demonstrate their bona fides, and the capacity to do that, by having the equivalent of a charities passport, has incredible appeal’

In summarising the situation I referred to earlier—the Australian Taxation Office becoming the default regulator for the sector—ACOSS said:

‘… it was never intended (nor has it wanted) to be the sector’s regulator; and the relationship between the sector and the ATO is less than positive as a result.’

If we are able to provide a more streamlined reporting arrangement for Australia's charities, that will provide great benefit to these charities.

Some have asked why the states and territories have not signed on already, but I think this is putting the cart before the horse.

It is vital that we build the ACNC and then allow states and territories to look at exactly what they will be signing up to. I fully expect that states and territories will do just that. It is strongly in their interests not to be collecting data that is already held by an ACNC. It is in their interests to be able to simply encourage charities to use a charitable passport. That ought to free up public servants in states and territories to focus on service delivery, not on requiring not-for-profits to provide information they have already provided to other agencies.

I commend the member for Parramatta for her excellent chairing of the committee. The report made a number of recommendations. It suggested, for example, that in the case of private ancillary funds, a tax-effective mechanism for individuals to pursue philanthropy which requires at least five per cent of the wealth of the PAF to be distributed annually and that the government investigate ways to strengthen protection in the bills for private donors who wish to keep their philanthropy anonymous. Recognising the desire for anonymity is an important feature in the bill. The committee also referred to the director's liability regime. The report said:

‘The committee is concerned that either the directors' liability regime is unduly onerous, as suggested by a significant portion of expert evidence presented to the committee, or that, as presented in the Bill, it is not sufficiently comprehensible for people to understand its intent or purported mode of operation. … Placing an unnecessary burden of liability could be seen as … a disincentive, which is opposed to the purpose and objects of the Bill. The committee therefore recommends that Treasury read draft this section of the legislation with a view to clarifying its intent and operation.’

The committee went on to note that the penalty amounts in the bill were roughly comparable with state and territory provisions but there was uncertainty among some witnesses as to the amount of discretion that would be available to the commissioner. The committee recommended accordingly that the explanatory memorandum to the bills clarify that the commissioner has the discretion not to impose an administrative penalty.

The committee scrutinised the bills thoroughly but the majority of the committee came strongly to the view that this is an important bill, that this bill will cut through red tape for the charitable and not-for-profit sector, a bill which will reduce frustrating and unnecessary duplication. I could see in the eyes of many of the witnesses the sheer sense of frustration at having to write the same details on the same forms. We have all had it from time to time when dealing with an agency that requires us to provide back to it information which it knows already. But how much more frustrating must it be for many of these charities and not-for-profit to have to remit information to a second government agency which it knows is already held by the first government agency.

I am surprised that the coalition are not supporting this bill. I know there is a strong tradition in the conservative parties of supporting the charitable sector and of reducing regulation. I am disappointed that the member for Menzies has chosen to run something of a scare campaign on this bill and has chosen to suggest that the government is increasing regulation; whereas, in fact, we are in fact simply doing what so many inquiries, going back to an inquiry under the coalition in 2001, have recommended—that is, to take the approach that Britain, Canada and New Zealand have taken, to cut through the duplication by allowing the equivalent of a charities passport. The member for Menzies has been selectively quoting from the sector and has not recognised in many cases that organisations he has quoted strongly support the bill. For example, ACOSS, the Community Council for Australia, the National Roundtable of Nonprofit Organisations, Philanthropy Australia, the Smith Family, the RSPCA and Chartered Secretaries Australia are all supporters of the Australian Charities and Not-for-profits Commission. I commend the bill to the House.