Senator IAN MACDONALD (Queensland) (18:17): I, like everyone else here, enjoyed Senator Duniam's contribution. It's good to hear debate in this chamber when someone actually knows what they're talking about, and Senator Duniam clearly has intimate knowledge of this bill and the work that ASIC does. These amendments that we are debating today implement a series of enhancements to the capabilities of the Australian Securities and Investments Commission. They're important. ASIC does wonderful work around Australia within the context of business and finance, and we are indeed fortunate in Australia in having a financial system and a regulatory system that assists business and assists people to operate in the corporate sector in the appropriate way. That's important because we are a nation that relies upon private industry to create the jobs that are necessary to keep Australia going, and that means providing work for Australians. We do that very well as a country, and we have for a long time. Indeed, one of the prouder things of this Liberal-National government over the last five or six years has been that we have been able to create jobs—not government created jobs, as happened under the Labor Party, but jobs created by private enterprise principally.
Mr Acting Deputy President Whish-Wilson, you will be aware that, since the Liberal-National government came to power, we have created over a million new jobs, with 400,000 in the last year. When I say 'we've created them', that's perhaps not correct; it's not we, the government, that have created them but we, the government, have provided the parameters and the background for the private industry to expand, and that means jobs are created.
This bill that we're debating today, as I say, implements a series of enhancements to the capability of the Australian Securities and Investments Commission. That commission, as senators know, is about making sure our corporate entities 'do the right thing', to perhaps put it in the vernacular. Senators know that ASIC is Australia's integrated corporate market and financial service, and a consumer credit regulator. It's an independent Commonwealth government body that was set up in 2001. Importantly, this bill enacts some key recommendations from the financial services inquiry and the ASIC capability review. It is further evidence of the government's commitment to strengthening ASIC and to ensuring that the financial system delivers fair outcomes for all Australians.
The government has been working to improve ASIC's performance, and this bill will add to that. What the government has done in the past is provide ASIC with a stronger funding base through the introduction of an industry funding model. This will ensure that the cost of regulation is borne by those who have created the need for it—and isn't that fair? That's the Australian way.
ASIC was created because there was a need. Entities did activities and actions that needed a regulator. They created the need for a regulator like ASIC, and, accordingly, those that create the need pay for it. It's important that those people who benefit from it and who caused, if one might say, the need for it pay for it rather than the Australian public. Regrettably, in Australia, it is very often the Australian public who bear the cost of financial sector misconduct. What we've done as a government means that those who have caused the need for increased regulation are paying for it.
That reminds me of, dare I mention it, the Storm Financial scandal that, I'm ashamed to say, emanated out of a business entity in the city of Townsville, where I have my base office, where many people lost a lot of money. Admittedly, they initially made a lot of money but subsequently lost a lot of money through the misconduct of those involved with the management of their money. ASIC was very involved in the investigations into the Storm Financial situation. Some of the work that ASIC did resulted in some justice for those who invested in good faith in the schemes that Storm were proposing and lost a lot of money. Whilst the work ASIC did in the Storm Financial case is not without its critics, ASIC did by and large take action that resulted in some people recovering some of the money they lost.
This bill provides new tools and powers for ASIC, including the power to intervene in the sale and distribution of financial products where there is a risk to significant consumer detriment. Previous speakers have gone into that in greater detail.
The ASIC Enforcement Review taskforce, which was established, again, by a Liberal-National government, in October 2016, made some recommendations assessing the suitability of the existing regulatory tools that were available to ASIC, and this bill has two schedules which deal with some of those recommendations. As senators who are following this debate will know, schedule 1 to the bill amends the act to mandate that ASIC must consider the effects that the performance of its function and the exercise of its powers will have on competition in the financial system. An explicit reference to take competition issues into account will require ASIC to conscientiously consider how its actions may impact on competition in the financial system.
That's in line with the government's philosophy on matters relating to business and finance. We believe that competition, not regulation, is the best means of ensuring that consumers get value for money in financial services, and we have a longstanding history of support for competition. This is not just for competition sake. We believe, and I think history has proved, that competition is the best form of regulator and that consumers get better results from a competitive situation than from governments coming in and trying to use the big stick to regulate activities of businesses in Australia.
This measure complements other key initiatives undertaken by the government to support competition, including tasking the Productivity Commission to review competition in Australia's financial system and funding the ACCC to undertake in-depth inquiries into specific financial system competition measures. This measure fulfils the government's commitment to implement recommendation 30 of the Financial System Inquiry. The recommendation stated, as senators will well know, that the government should include consideration of competition in ASIC's mandate.
I did want to go on and discuss at length schedule 2 to the bill, which amends the ASIC Act to remove the requirement for ASIC to engage staff under the Public Service Act, and senators will know that consequential amendments are also made to the Business Names Registration Act, the Corporations Act and the Mutual Assistance in Business Regulation Act. Removing the requirement of ASIC to employ people under the Public Service Act promotes greater operational flexibility and brings ASIC into line with Australia's other financial regulators who have that flexibility. They are, as you know, the Prudential Regulation Authority and the Reserve Bank. I did want to say a few more words on that, but, unfortunately, I think time is going to beat me. Suffice to say, I think this is a good bill. It heads in the right direction and, again, I would urge my colleagues in the Senate to support this bill. I think it is good for Australia.