Craig Kelly (Hughes, Liberal Party) Share this | Hansard source

I hear the member for Moreton interjecting. I was not here in 2009, and I acknowledge that the coalition did not oppose the legislation, but voted for it. I say that was wrong. I have been gracious enough to say that that was incorrect. I would hope that the member for Moreton would stand up in this parliament and admit that he made a terrible error back in 2009 and got it hopelessly wrong.

Let's have a look at some of the effects of the member for Moreton's foolhardy support of that legislation. Let's look at a couple of cases. The first one is the case of OneSteel and Alleasing. The leasing equipment in that case was in the value of $23 million. An Alleasing employee, responsible for making the government registrations, failed to register the security interest—failed to fill in the bureaucratic government form—in accordance with the specific registration requirements. He used an incorrect ABN number on the registration. That $23 million worth of assets was actually lost by the company and transferred to the company in receivership. That was a windfall gain of $24 million, unfairly lost all because of this original legislation.

Another case was Power Rental Op Co versus Forge Group Power. It was only decided a month or so ago. That case involved, of all things, four mobile wind turbines that were leased by Forge Group Power from General Electric for a period in excess of 12 months. GE was regularly engaged in the business of leasing goods. Even though you would think that you would have to bolt a wind turbine to the ground, the court held that they were not fixtures and found that under the current leases, under this PPS legislation supported by the member for Moreton over there, the turbines became the property of the administrator. This was after only one month. One month had passed in which the leased goods were held by the company that was hiring them. They struck financial difficulties and had an administrator appointed. US$44 million—probably close to A$55 million—was lost: an unjust asset transfer from one company to another company; a complete windfall gain. Of course that money goes to the secured creditors, which would be the large banks, and also money to fund the liquidator's payments. It is simply a transfer from often the small end of town to the big end of town under this legislation.

This legislation does not fix the issue of the Romalpa clause. I would hope that very shortly, having fixed up this one mistake, both sides of this parliament would go back and look at this issue of going back to simply contractual terms of a Romalpa clause, not having to be something that requires a bureaucratic process that you have to go through to do it. It is extra paperwork, extra processes, completely against the interests of small business, leading to unjust, unfair outcomes.

With this legislation we are changing the minimum duration for which leases apply down from two years to one year. It was previously two years; it is now one year. More importantly, it also has the effect that leases of an indefinite term will not be deemed PPS leases unless they have run for a period of more than two years. So that enables companies to put on their lease documents that it is an indefinite period of time, and only once it gets over that two years do they need to register. I would prefer that there were no need for registration whatsoever, but at least this remedies those appalling court cases that we saw, which were little more than theft from one company to another.

The member for Isaacs, in his contribution, also talked about what else the coalition is doing to get this economy underway. In the few minutes left I would like to address some of those things. There are a couple of very important things that we need to do. Firstly, we need to get energy costs under control. We cannot do that when coal-fired power stations are continuing to be run out of town because they cannot compete with subsidised renewables, especially wind turbines.

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