BILLS - Treasury Laws Amendment (2019 Measures No. 2) Bill 2019 - Second Reading

17 October 2019

Mr STEPHEN JONES (Whitlam) (11:13): I move:

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

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

(1) notes:

(a) that this Government has no plan to support the Australian economy; and

(b) that, in the absence of any Government plan for the economy, the IMF has today slashed Australia's growth rate forecast to just 1.7 per centthe lowest level in a decadeand predicts unemployment to stay stubbornly high; and

(2) calls on the Government to immediately undertake sensible economic action by:

(a) bringing forward infrastructure investments, particularly in regional areas;

(b) bringing forward part of its stage 2 income tax package to 2019-20 to provide relief for middle income earners, as this would have provided up to $1,350 a year to those earning above $90,000 three years earlier than currently planned;

(c) reviewing and responsibly increasing the rate of Newstart, as this would help to alleviate poverty, help people get into work, and would provide an effective and much needed boost to consumption;

(d) implementing a version of the Opposition's Australian Investment Guarantee to incentivise and boost business investment; and

(e) developing a comprehensive plan to boost wages, starting with restoring penalty rates for workers who are most likely to spend in the economy".

Australians woke up this morning to learn that the International Monetary Fund had downgraded Australia's economic growth forecast to 1.7 per cent this year and to 2.3 per cent in 2020. This is the second time this year that the IMF has downgraded Australia's growth forecast, and it comes after a string of economic commentators, supervisors and regulators have sent a very clear message to the government that business as usual is not going to see an end to the sluggish economic growth. It's not going to turn the economy around. It is time for the government to get out of the grandstand, get on the playing field and put in place an economic strategy which will turn this country around.

We have wages growth at record lows. We have interest rates at levels lower than during the global financial crisis, when this mob over on that side of the House decried that those interest rates were at emergency levels. So if they were at emergency levels during the global financial crisis, what are they today? If the second downgrade in Australia's economic growth forecast by the IMF in a single year will not jolt this government out of its arrogant slumber, then what will?

Australians need a plan. Australian businesses need a plan. They do not need a Prime Minister who struts his way around the country in an arrogant victory lap after an unexpected election win with nary a plan to turn the economy around. Australians need real wages growth. Businesses need certainty, so that they can invest in productivity-enhancing infrastructure and capital and ensure that the next generation of economic growth is going to be sustainable. Without a plan, we can expect the situation to continue.

Through this amendment, we are calling on the parliament and the government to do what is necessary to put in place a fiscal strategy, which should start with bringing forward infrastructure spending. We are told that the government has set aside $100 billion to boost infrastructure spending in this country. The problem with that is that the majorityover 70 per centof that $100 billion won't be spent this year; it won't be spent next year; and it won't be spent the year after. In fact, over 70 per cent of that $100 billion won't be spent until after the next election. Well, Australia is crying out for these projects to be invested in today.

Throughout regional Australia, there are literally thousands of community and economic infrastructure projects which, if invested in today, would boost local employment, would boost wages and would boost those local economies. In my own electorate, where over 20,000 people a day get in a car or on a train and travel to Sydney or Western Sydney for employment, an upgrade to the Illawarra-Sydney rail link, an improvement in the Appin Road, an improvement in the Picton Road, and improvements to and investment in the Princes Highwaywhich the government has promised to doare sorely needed investments which should happen and can happen. The planning has been done. Money has been set aside, we are told. Bring that money forward. Invest in those local projects to get the economy moving. We call on the government to invest in those projects within the Illawarra and on the South Coast and right around the country.

No. 2: if there is a politician on that side of the House who says that they can live on $280 a week, well, stick your hand up, because we want to see it. A chorus of people, from big business and the Business Council of Australia to the community organisationsin fact, the majority of organisations who have turned their mind to the problem of the unsurvivability of Newstarthave said: 'We need to shift the rate of Newstart.' So we call on the government, as part of a comprehensive fiscal strategy which invests in infrastructure, to review the rate of Newstart, because we know that that will provide an immediate stimulus to the economy and provide much-needed sustenance to the people who are on the lowest incomes in this country. We are told that the level of Newstart is so low that it is actually acting as an impediment to people entering the workforce. So we call on the government to do the right thing: firstly, invest in infrastructure; secondly, review the rate of Newstart; and thirdly, bring forward those stage 2 income tax cuts.

The majority of the income tax package won't be delivered until close to or after the next election. We're calling on the government to bring forward those stage 2 income tax packages to provide relief for middle- and low-income earners. This will provide, three years earlier than currently planned, up to $1,350 a year to those earning above $90,000. Again, it's another sensible measure which would provide much-needed stimulus to the economy. This is the strategy that is needednot strutting around the country unwilling to listen to business, unwilling to listen to the Reserve Bank of Australia, unwilling to listen to the investors and unwilling to listen to anybody who doesn't agree on the need to put in place an economic plan and a fiscal strategy. So I commend the amendment to the House.

Going to the details of the bill, schedule 1 extends concessional tax treatments of genuine redundancies and early retirement scheme payments to those under the pension qualifying age. These payments generally include a tax-free component. However, currently, a person can only receive the tax-free component if they are under 65 years of age at the time of the termination of their employment or their retirement from employment. This change has been necessary since the age for pension eligibility increased on 1 July 2017. These amendments will assist older Australians who receive a genuine redundancy or early retirement payment but are not yet able to receive the age pension. These are much-needed reforms, a little late in coming to this parliament, but they are reforms the opposition will support.

Schedule 2 to the bill provides an increased refund of the luxury car tax to individuals who purchase a heavy duty passenger vehicle as part of their tourism or primary production business. The proportion of luxury car tax that can be refunded will be increased, and the maximum amount of the refund will also be increased, to $10,000. These changes will apply to eligible vehicles acquired on or after 1 July 2019. We support these proposed amendments.

Schedule 3 to the bill amends the Competition and Consumer Act 2010 to expand the board of the Australian Energy Regulator from three to five members, and puts other measures in place to ensure that the expanded board can operate efficiently. We support this uncontroversial amendment.

Schedule 4 to the bill includes an amendment which was initially drafted by Labor to include a deletion right as part of the consumer data right reforms passed with bipartisan support a few months ago. Labor made the introduction of this amendment a condition of its support for the consumer data right legislation. Labor supports the open banking regime. However, we want to ensure that, as consumers' information is passed from one bank to another or through to intermediaries through the operation of this scheme, the owners of that data, the people whom the data is in respect of, have the right to initiate the deletion of that data. That is an important privacy protection that should have been a part of the initial drafting of the scheme.

The amendment requires the ACCC to develop rules relating to the deletion of personal data, allowing individuals to demand that their data is deleted by a data recipient. This will instil greater confidence in the consumer data rights system and ensure that respect for consumers is a central element of any participating data recipient's approach. This is a win for the consumers in the CDR regime, and I commend the Treasurer and the government for honouring the agreement that they reached with me and the opposition in bringing forward this amendment.

Schedule 5 of the bill amends the Superannuation (Unclaimed Money and Lost Members) Act 1999 to enable the Commissioner of Taxation to calculate and pay interest on ATO held superannuation that is held by the commissioner under the act. For the benefit of members, the ATO now has responsibility for holding in trust unclaimed or unidentifiable superannuation accountsthat is, those superannuation accounts where the super fund has made attempts to contact the owners but, because of a lack of personal information, the fund has been unable to track down those account holders. The ATO, if you like, is the trustee of last resort, taking control of and ownership in trust of those superannuation funds until they can be reunited with their rightful owners.

Schedule 5 also amends the relevant regulations to prescribe the rate of interest paid by the commissioner on those ATO held accounts, which, according to the regulations, will be based on the consumer price index. It is interesting to note that this rate is significantly below that which the government or any Australian would consider to be a reasonable rate of return for a superannuation account. I am quite certainas APRA is conducting its heat map of the performance of superannuation funds or RSEs over the next 12 months, with the initial data to be released in a few months timethat the expected rate of return for those funds will be considerably more than the CPI. I fully anticipate that both APRA and, perhaps in due course, ASIC will be issuing 'please explain' notices to the trustees of those funds if they are delivering rates of return at just CPI. We do note that the ATO is intended only to hold these funds on a short-term basis. However, this is a provision that warrants the ongoing scrutiny of parliament in all its forms to ensure that if these funds are not kept for a short period of timethat is, they are unable to be reunited with their rightful ownerthen we review the rate of return which is presumed to be earned by those funds held in trust by the ATO.

I would encourage the government to review these regulations and consider whether paying Australians CPI rates on their superannuation fundsfunds that they are relying on for their retirementis an appropriate decision. With these observations in mind, we encourage all members to vote for the amendments and to support the schedules to the bill as indicated in in my address.

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

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