On the two Corporations Amendment Bills


Senator IAN MACDONALD (Queensland) (09:52): What a wonderful speech by Senator Fierravanti-Wells! It is a pity there was not someone in the chamber from the government side to listen to that. In fact, talking about that, I note that there does not seem to be a quorum in the chamber. Mr Deputy President, I draw your attention to the state of the chamber. (Quorum formed)Thank you, Mr Deputy President. I am pleased that all the Labor senators came in to hear my speech; it is well worth listening to. This is a truncated debate, and I know that a lot of my colleagues want to speak on this, so I will be briefer than I would normally be. Perhaps I could start off by talking about the truncated debate because of the guillotine imposed by the Labor Party and the Greens. I will start off with a quote:

What is more, the Labor Party is going to support the whole of this legislation when the guillotine falls in about an hour from now.

I might just interpose by saying 'an hour from now' is much more time for debate than the Labor Party and the Greens have given for many of the pieces of legislation that are being guillotined through this parliament. The quote continued:

This is a tawdry exercise in taking democracy out of this place

this place being the Senate chamber. And who said that The then Leader of the Australian Greens, Senator Bob Brown. He was railing against the guillotining of any legislation. I might ask Senator Ludlam, when he makes his contribution to these bills: why is it that when the Howard government apparently had a guillotine in place it was 'a tawdry exercise in taking democracy out of this place', and yet nowadays the Greens support the Labor Party in guillotining 36 bills in this fortnight of sitting

Madam Acting Deputy President, can I just dwell on that for a moment: 36 bills are being guillotined by the Greens political party and the Australian Labor Party in the next two weeks. In the whole three years of the last term of the Howard government, how many bills were guillotined Thirty-six. So the Labor Party and the Greens political party are guillotining, in this fortnight, more bills than the Howard government guillotined in three yearsat a time, I might add, when the Howard government had control, entirely, of this chamber. So what hypocrisy from the Greens, that they would in those days label this guillotining as a 'tawdry exercise in taking democracy out of this place' but nowadays, because the Greens and the Labor Party are one and the same, it seems okay.

I do want to move on to the bills, which I do have an interest inmainly because they sort of had their origins in the Storm Financial collapse. It is with some embarrassment that I have to say that the Storm Financial fiasco originated in the city of Townsville, in North Queensland, where I have my office. It became an entity which, in the end, took a lot of people's money, and put a lot of people I know personally in a very difficult financial situation, because of the lack of proper regulation, and proper enforcement of the existing regulations in the financial services industry. It was as a result of that fiasco with Storm Financial that these bills, the Corporations Amendment (Future of Financial Advice) Bill 2012 and the Corporations Amendment (Further Future of Financial Advice Measures) Bill 2012, are before us today.

As a result of the Storm Financial crisis, the Ripoll inquiry was set up by this parliament to investigate all aspects of financial advice in the investment and retirement investment fields. This committee, comprising obviously members of all parties in the parliament, deliberated and brought forward a series of recommendations. While I did not agree wholeheartedly with every single one of the recommendations, by and large the recommendations were appropriate and I would have hoped they might have gone from recommendations into legislation. But this government with its typical arrogance and with its typical lack of understanding of what really is bestan understanding which should have been there if they had properly looked at the whole reporthave brought in a bill which again, as with most of its legislation, is off the mark. The coalition will be attempting today to fix obvious errors in this bill with amendments. But should those amendments not be supported then, as our leader in this debate, Senator Cormann, has said, we will be opposing the bill. So I do urge the Greens and the Labor Party to actually adopt the amendments.

I am pleased to say I note that just yesterdayafter this debate had started, and this is typical of the way the Labor Party runs this chamber and it is the same as the way they run the governmentthe government brought in some amendments and I do note this was after the debate had startedlate last night. I am pleased that one of those amendments, however, is an adoption, an acceptance, by the government of one of the amendments that Senator Cormann was going to move, and that was the proposal by the coalition to at least start this bad legislation at the latest by 1 July 2013, rather than, as the Labor Party had originally proposed, by 1 July 2012. What the Labor Party wanted us to do was to debate this bill today so it could being introduced in 14 days time. One wonders why a country is in such a mess that we have this sort of legislation being dealt with today to start in 14 days time. I am pleased that the coalition's amendment has been accepted and so it will now been delayed with a final date of 1 July 2013.

But that is obviously why we have these guillotines in place. As of yesterday morning the Labor Party brings in that resolution, with the support of the Australian Greens political party, to guillotine 36 billsand this was one of them, and you can understand why they wanted to deal with this bill in record short time today, because as it stood this time yesterday morning it was to start in 14 days time. That is just incredible! So one does wonder, although I do not think most Australians do wonder anymore and they shake their heads in shame and embarrassment at the way this country is being governed, and the way this bill has been dealt with in the chamber is typical of that mismanagement.

The package of bills in its current form is, I submit, unnecessarily complex and in large part quite unclear. It is expected to increase unemployment. It is legislating to enshrine what we see and what the industry sees as an unlevel playing field amongst advice providers. It seems to me that it inappropriately favours a government-friendly business model. It is likely to cost about $700 million to implement and a further $350 million per annum to comply withand they are conservative estimates given by industry at various inquiries that have been held. As people in this chamber would know, for the Labor Party with a $700 million cost who cares It is a drop in the ocean to them. I would venture to say I suspect that, unlike most financial advisers who are their own bosses and who are small businessmen, nobody in the Labor Party, particularly in this chamber, has ever had to worry about making money or making losses or spending someone else's money.

Most of the Labor Party senators in this chamberalthough there is one exception perhapshave always worked for the trade union movement or the Australian Labor Party or for other politicians. None of them have had ever had their own businesses and their own houses on the line. So when they just spend $700 million it does not matter to any of the ministers in this government, as they do not know what it is like to waste $700 million. They do not have to pay for it and their pay cheques will come in at the end of the month, as they have always done with most of the ministers in this government. So it is just burdening these small businessman who are financial advisers with a $700 million cost upfront and $350 million per annum and it is only a drop in the ocean. To Labor Party ministers it is only a drop in the ocean. When you can convert a Howard government $60 billion surplus into a current Gillard government deficit of almost $150 billion, and increasing rapidly to over $200 billion, you can understand that Labor Party politicians just treat debt as pigs treat lying in the mud: they relish it. They think debt is pretty good. They do not seem to understand, because none of them have ever been in business, that if you borrow money, sometime the lender is going to want their money back, so it will have to be paid back. You do not need an economics degree to understand that. Of course, the lenders only give it to you because it is their business. They actually charge you a cost for lending you the $200 billion that the Labor Party has racked up. That is called interest. As all of us knowas any of us who have any understanding of business would knowwith the interest that we are going to pay on the Labor Party's $200 billion debt we could have another new hospital in Townsville or we could actually fix the Bruce Highway between Brisbane and Cape York. That is just with the interest that the Labor Party is causing the Australian taxpayers to pay.

Senator Conroy interjecting

Senator IAN MACDONALD: Senator Conroy is prattling away in the chamber. The greatest financial mismanagement this country has ever seen is the $55 billion of wasted investment in the National Broadband Network. But, Australians, do not despair: our good friend Senator Conroylovely guy though he isis in charge. Senator Conroy has never before run any sort of business in Australia, yet he is now in charge of Australia's biggest spending business, a business which he originally told us would make a profit and would be privatised. Senator Conroy, as I have often said and will continue to repeat, neither you nor I will be in this chamberI suspect not even you will be alivewhen the NBN makes a profit and when anyone in the private sector will want to buy it. It will eventually be got rid of at a written down, fire sale price.

The bills before us need improvement. I am delighted that Senator Cormann's amendments insist that the government is required to table a regulatory impact statement as assessed as compliant by the government's Office of Best Practice Regulation. The amendments also propose that the opt-in be removed completely from the legislation, that the retrospective application of additional annual fee disclosure requirements be removed and that the drafting of the best-interest duty will also be improved. We believe and our amendments will try to implement that the ban on commissions on risk insurance inside super should be further refined. Also we are going to move for a delay in the start of this legislationfortuitously the Labor Party have picked up this amendment.

Many of my colleagues want to debate this truncated legislation, so I will finish in this way. The financial advice industry is a very good one. There have been some rogues, as there are in any business, in any parliament, in any walk of life. By and large financial advisers are a great asset to Australia and offer real help and assistance to many people, particularly to older people who are looking towards retirement and their retirement income. They do a fabulous job. To a certain extent the Labor government have reviled these people, accusing all in the industry of being as bad as the one bad egg in the nest. By and large this industry is made up of good, honest, capable, intelligent and very well educated and learned people. I wish their industry the best. I say to the industry that while this government is trying to continue to penalise you to the cost of $700 million this year and $350 million every following year, a coalition government will understand the worth of the financial advice industry and will be supportive of the industry in the future.

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