Bert Van Manen (Forde, Liberal Party) Share this | Hansard source

Once again we stand in this place to speak on a piece of legislation that seeks to rectify the failures of the previous Labor government. Today we are speaking on the Banking Laws Amendment (Unclaimed Money) Bill 2015, which seeks to reverse the previous government's changes to Australia's unclaimed money provisions. This bill delivers on the government's promise to reform the unclaimed money provisions and contributes to the government's support of Australian business and consumers by reducing red tape and regulation.

It is worthwhile reflecting that this is just another in a long line of commitments that this government has taken to elections and through budgets and that we are now bringing to this House. In the 2015-16 budget the government announced that it would make these changes to the unclaimed money provisions in the Banking Act 1959 and the Life Insurance Act 1995. This bill will amend the Banking Act and the Life Insurance Act to specify that funds in bank accounts and life insurance policies cannot be deemed to be unclassified and therefore transferred to the Commonwealth until they have been inactive for at least seven years. These changes will be effective from 31 December 2015. This bill will also introduce secrecy provisions into the Banking Act and the Life Insurance Act to ensure that even under a freedom of information request the particulars of the mount of unclaimed money or the person to whom the money is payable cannot be released to anyone other than the account holder or an agent acting on their behalf.

It is worthwhile reflecting that between 1911 and 2012 accounts had to be inactive for at least seven years before funds could be transferred to the Commonwealth. Under these rules, only $70 million of unclaimed funds were transferred in 2011-12. But this is when the previous, Labor, government—desperate to fill the gaping black hole of their endless continuum of budget deficits, despite the fact that they said they were going to return to surplus, which they never did—decided to pick the pockets of hardworking Australians and reduce the required period of inactivity in bank accounts from seven to three years. That resulted in some $550 million of ordinary Australians' funds, from thousands of accounts, being transferred in 2012-13, an almost eightfold increase in a single year.

As the member for Ryan rightly pointed out, many of these accounts were certainly not unclaimed or forgotten but the funds were transferred to the government regardless, in order to seek to improve their budget bottom line. For many Australians this meant cancelled or delayed holidays, delays in making home purchases they had been saving for and many other issues completely unforeseen or considered by those opposite. For many Australians the consequences of not being able to access their savings when they were needed were dire, and stories abounded of these measures putting many Australians in all areas in positions of financial difficulty.

This was never acceptable, and as an opposition at the time many of us stood in this House and spoke against this legislation. Now, in government, we are seeking to make it right. That is why during the 2015 budget we committed to reforming these unclaimed money provisions. To protect Australians with unclaimed money from this exploitation, the bill will remove the requirement for ASIC to publish the unclaimed money gazette and will introduce secrecy provisions to ensure that only individuals with unclaimed accounts or those acting on their behalf will be able to access their data. I even saw in my time prior to entering this place the operations of the sorts of organisations that seek to charge exorbitant fees for people to reclaim either their unclaimed moneys or their unclaimed shareholdings. Very frequently we were able to assist those people very simply and, at no cost, reclaim or get access to their funds.

This bill also amends the Banking Act to exempt funds held in foreign currency accounts from the unclaimed money provisions and to exempt funds held by or on behalf of an individual under the age of 18 from the unclaimed money provisions. It also seeks to ensure that if an account holder or their agent notifies their ADI that they would like their account to remain active any time prior to its transfer to the Commonwealth then that account does not have to be transferred.

As mentioned, this bill delivers on the government's promise to reform the unclaimed money provisions. This bill will leave more Australians in control of their own finances and will better protect their personal information and leave a safety net in place to protect those with truly forgotten amounts from having their value eroded by fees and charges. From 31 December 2015 this bill will ensure that the funds from Australian bank accounts and life insurance policies can be transferred to the Australian Securities and Investments Commission only after they have been inactive for at least seven years. This bill seeks to return or restore the situation to the way it was prior to 2012 and had been since 1911. Therefore, I commend this bill to the House.

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