Michael McCormack (Riverina, National Party, Parliamentary Secretary to the Minister for Finance) Share this | Hansard source

Not quite, but we did turn a very small business operating out of three garages in Wagga Wagga into quite a profitable little business which is still going.

Mr Ripoll interjecting—

Thank you, member for Oxley. That independence is one of the reasons so many entrepreneurial Australians go into business for themselves—to be their own boss. The measures in this bill will make it easier for small businesses to comply with their superannuation obligations and that is so very important. We recognise that it is important for employers to do the right thing by their employees as far as superannuation is concerned. In my experience, most of them do. This bill does not lessen the obligation on any employer to do the right thing by those people who they take into the trust as their employees. But it will make the compliance task easier, more efficient.

One of this government's early actions upon coming to government was to move the Small Business Superannuation Clearing House to the Australian Taxation Office, out of the Department of Human Services and into an agency which most small businesses are already familiar with in relation to tax and superannuation matters.

In introducing this bill on 28 May, the Minister for Small Business, the member for Dunkley, informed the House that between 1 April 2014 and 30 April 2015 around an additional 42,500 employers have registered to use the service, bringing total registrations to 100,000. That is a very commendable and good result. One of the big attractions of using the clearing house is that if your employees belong to a range of different superannuation funds, which often happens when you have people moving around in and out of different jobs over a period of time, then you only need to deal with the clearing house—that is all. You do not need to interface with multiple superannuation funds. So that is going to make it more streamlined and simplify things, which, for time-poor small-business operators, is so important because they need to spend every precious moment doing what they do best—that is, serving customers, making things and getting on with the job of trying to eke out a living. They do not need to be burdened with unnecessary paperwork and unnecessary compliance. So that is why the coalition, which understands small business, which understands how important they are and which understands how time-poor they are, is getting on with the job of helping them in every single aspect of doing what they do best.

As a small business, you have the certainty that once the clearing house has received your contributions then your job is started and you have complied with your obligations up to that point. The clearing house takes on the responsibility for dispersing contributions according to your particular instructions. Currently the clearing house is available only to businesses with fewer than 20 employees and that takes into account a lot of them. But from 1 July 2015, we are expanding access to this service so that any business with a turnover of less than $2 million—the definition of a small business for income tax purposes—will be able to use this service. So whether your turnover is less than $2 million or whether you have fewer than 20 employees, from 1 July this year you will be able to use the Small Business Superannuation Clearing House. A small business obviously needs to spend some time getting itself acquainted and registered with the clearing house, but compare that to having to register with multiple superannuation funds. Again, there is that level of cooperation that we are placing in small business, that level of simplification that we are bringing about in this policy change. I encourage any small business that is not yet using the Small Business Superannuation Clearing House to check it out online and think about what it might be able to do assist them. It is a free service offered by the government and just one way in which we are supporting Australian small business to have a go. It is one click away. Check it out online, and you will be amazed at how easy it is to access and to use and by the fact that it will give you more time to do what you do best in your small business.

The key change that this bill makes is to amend the law so that employers no longer have to provide a standard choice of fund to temporary residents. Currently, a failure to supply a temporary resident whom the business employs with a choice of fund form can leave the employer liable for penalty. This bill does not remove a temporary resident's right to exercise choice in relation to the fund which they would like their superannuation directed into, but the reality is that many temporary residents do not already have an existing superannuation fund in Australian and are unlikely to exercise choice of fund in the relatively short time they are in this country. That has implications—certainly for the Riverina.

I would like to point out that in the minister's 28 May introduction of this bill one of the changes he talks about is employers no longer having to provide a standard choice form to temporary residents. He said:

A standard choice form allows employees to nominate their superannuation fund. Generally employers have to give this form to employees within 28 days of the employee starting their job.

I would like to emphasise that the government is not taking away the right of a temporary resident to choose a superannuation fund. What we are doing is simplifying the paperwork requirements for businesses that employ temporary residents such as those on a working holiday visa.

Under these changes, employers will no longer have to supply a standard choice form to temporary resident employees. It also means time-poor small businesses will no longer have to spend time explaining how to complete the form.

This change will also make it easier for employers to pay their workers' superannuation on time.

He went on to comment:

The majority of businesses in these sectors are small businesses. Around 92 per cent of businesses in hospitality and 99 per cent of businesses in agriculture are small businesses.

That affects the Riverina electorate I represent because many of them employ seasonal pickers. Once they have picked the apples in Batlow, they move west and into the Murrumbidgee irrigation area around Leeton, Narrandera and Griffith to pick grapes and do all the sorts of things that great food bowl of the nation does. Quite frankly, at any given harvest time in the Riverina they simply would not be able to get their crops off if they did not have those seasonal workers, many of them on short-stay holiday visas. Those backpackers are invaluable to the Riverina—indeed, to many rural and regional electorates right throughout Australia.

This legislation is important.

Mr Husic interjecting—

Be quiet, member for Chifley! It is important that people know of these changes and it is important that employers avail themselves of these changes, because it will mean a streamlining of the obligations that they currently have. The change is established to result in an annual compliance cost saving of $45 million. It removes the threat of a penalty on a business merely for failing to give someone a piece of paper. This means that employers can focus on doing the right thing by their business and their employees and less on ticking boxes dreamt up by bureaucrats. That is important. It might not mean a lot to the member for Chifley, but every dollar helps to pay down that debt and deficit legacy that his previous government left the country—not the government but the country, the fine taxpayers, the fine small business people of this nation.

I am pleased to inform the House that this will make a big difference—it will make a huge difference—to business operating in the Riverina, particularly the fruit growers who rely—

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