Michael McCormack (Riverina, National Party, Minister for Small Business) Share this | Hansard source

I thank the honourable members for their contributions to be Personal Properties Securities Amendment (PPS Leases) Bill 2017. The Personal Properties Securities Act 2009 is an important reform which established a single national set of rules for secured credit using personal property. The framework provides greater clarity for both lenders and consumers than ever before, and, since its introduction, Australian businesses are now more readily able to use their assets as security for obtaining cost-effective secured finance.

It is clear, though, after a period of time that there are compelling reasons to make adjustments to the act. The regulatory impact the act has had on short-term equipment hire businesses is one such case. Businesses with high volumes of short but indefinite term leases have had difficulties adapting to the framework and have struggled to meet the administrative burden. And this government is all about lifting administrative burden and cutting through red tape.

The consequences for small and medium enterprise hire operators in some circumstances can be quite severe. Extending the minimum duration of a lease before it becomes a PPS lease will lift the burden the act is having on the hire and rental industry. Leases with an indefinite term will only require registration once they have exceeded two years in length, and fixed-term leases will only require registration if they are for a term of more than two years. The changes to the PPS lease time frame in this bill are aimed at ensuring that the short-term hire and rental sector remains a strong contributor to the Australian economy without disrupting the effectiveness of the operation of the rest of this important national framework.

Deputy Speaker, I would like to respond to the member for Isaacs' comments on the Whittaker review. The government is considering the total of the 394 recommendations from the report of the review of the Personal Property Securities Act. The report is comprehensive; it provides recommendations on technical and complex aspects of the legislation which are interlinked and must be progressed as a complete package. The bill deals with an urgent matter of reform which can be dealt with now, independently of other issues addressed in the report.

This bill provides relief to the hire and rental industry without disrupting the proper operation of the rest of this important national framework. The government, through the Attorney-General's Department, is working closely with the Australian Financial Security Authority to develop a response to the report which will benefit businesses and consumers to the maximum potential.

In conclusion, a range of industry representatives have been consulted on these measures in order to preserve the balance between competing interests of all stakeholders who deal with the act on a day-to-day basis. With the assistance of industry and the support for the bill provided by state and territory governments, these measures will succeed in providing short-term hire businesses with appropriate relief.

Question agreed to.

Bill read a second time.

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