Jason Falinski (Mackellar, Liberal Party) Share this | Hansard source

I rise today to support the Corporations (Fees) Amendment (ASIC Fees) Bill 2018 and related bills. This legislation will allow the Australian Securities and Investments Commission, otherwise known as ASIC, to operate in a more efficient and effective manner. Corporate governance and the enforcement of sensible regulations are key to a functioning society and financial sector. We only have to look back as far as 2008 to the fallout of the global financial crisis to see the impact that poor accountability in governance can have on public confidence in the financial system and its ability to operate in a sustainable manner. This initiative is one part of this government's commitment to ensuring that the Australian people have trust and confidence in the financial system and the likes of ASIC. Only through improving the manner in which ASIC operates and the transparency of its actions can we look to safeguard trust in our institutions and their ability to function.

The bill will increase fee caps to allow ASIC to recover the costs it incurs when providing regulatory services. This is in conjunction with expanding the definition of 'chargeable matters' and clarifying fee regulations regarding what constitutes a chargeable matter. The bill has been devised in consultation with stakeholders and follows acceptance of the April 2016 recommendation of financial system inquiry to introduce an industry funding model for ASIC. Thorough consultation is essential to good government, and a functioning democracy and the implementation of the inquiry's recommendations are a testament to this.

At the core of the bill is a focus on equity and accountability. Gone are the days of nominal fees that are subsidised by taxpayers. Now the recipients of a government activity will be the ones that solely bear its costs. Taxpayers will be saved from their burden by the introduction of a fee for service which differs depending on the time and effort involved in the task. The bill will make ASIC more accountable and increase stakeholder awareness regarding how much a government activity costs. The industry-funding model's introduction will also help to encourage regulatory compliance and improve ASIC's resource allocation. A more accountable ASIC, acting as a strong and fair corporate regulator, is undoubtedly a good thing. Australians deserve to know why charges are made and where the money goes.

The Liberal Party is committed to promoting efficiency and reducing red tape. Unnecessary bureaucracy kills investment and the confidence of individuals to take a risk through entrepreneurship. Our economy is built on individual Australians and businesses having a go and being confident enough to build towards a better future. While the Labor Party seeks to destroy innovation and entrepreneurship through their mantra of big government, we, as Liberals, are committed to ensuring that Australians are given the opportunity to pursue their ambitions. However, when there is a role for regulation and corporate regulators such as ASIC, it is our firm belief, as Liberals, that such regulation should be effective and transparent. There is no point in having an independent Australian government body and corporate regulator that cannot act as it was intended to act.

Good governance and the equitable enforcement of regulations are paramount to the viability and long-term performance of our industries. ASIC plays an important role in this by acting as Australia's corporate regulator. Efficient and transparent governance is an essential tenet of a functioning democracy, with independent government bodies ensuring that regulations are enforced properly, regardless of how the political landscape is playing out. Independent bodies are a core tenet of a liberal society and system of governance and inspire confidence in our system. Ensuring that ASIC can set and has the means to set appropriate changes will allow it to maintain the rule of law and enforce regulations in the company and financial sectors. The bill, and the funding model that it proposes, will improve consumer outcomes by allowing ASIC to better predict, monitor and respond to market risks and allow for the redirection of hundreds of millions of taxpayer dollars towards activities that benefit more taxpayers. Government has a responsibility to ensure that taxpayer dollars are spent wisely and in an equitable manner, and this bill builds towards that end goal.

We live in pressing times when the very structures of our democratic institutions are under threat. The recent phenomena of fake news and alternative facts have led to the promotion of a mindset that objective thought and our very democracy are crumbling. The line between fact and fiction has been blurred. These circumstances provide all the more reason for the reassertion of the value of transparency and its importance to democratic institutions and, in particular, market institutions. The key ideal that separates liberal democracies from systems of centralised governance and authoritarianism is an emphasis on openness and accountability. As American attorney and orator Patrick Henry reminds us:

The liberties of a people never were, nor ever will be, secure, when the transactions of their rulers may be concealed from them.

Trust in government in the West has also recently hit all-time lows. The Pew Research Centre found that only 18 per cent of Americans say they can trust the government in Washington to do what is right just about always or most of the time. Contrast this to the 1958 national election study, which found that 75 per cent of Americans strongly trusted Washington to get it right.

Australia is not necessarily fairing much better. The 2018 Edelman Trust Barometer, which measures public trust in four types of institutions across 28 countries, found that the percentage of Australians who say they have trust in their governments has declined to 35 per cent. This puts Australia on the same level as Spain, Ireland, the UK and Japan. As Steve Spurr, CEO of Edelman Australia commented:

It is deeply troubling that a majority of Australians believe their government is broken.

Such an emotive description of government as 'broken' may be a stretch too far. The rise of parties and figures outside the historically predominant Liberal, National and Labor groupings does indicate a changing political landscape in Australia. While some will blame these trends on the 24-hour news cycle or increasingly cynical populations, it is clear that there has been a shift in views on government.

The fall of the Roman Republic lends some interesting lessons on the deterioration of institutions. Richard Alston, a professor of Roman history at the University of London, wrote the renowned book Rome's Revolution: Death of the Republic and Birth of the Empire. The rise of the Roman Empire and fall of the democratic republic were in part due to the decay and corruption of age-old institutions weakened by special interests and a lack of accountability. For Rome, the greatest threat to republicanism wasn't outside forces but internal power grabs cloaked in the rhetoric of populist government. The likes of Caesar and Octavian knew how to play the system and its people.

Australia is not at risk of descending from democracy to dictatorship like the old Roman Empire but there are still important lessons on transparency and government accountability to be heeded. Government should be trying to do all it can to ensure it supports transparent processes so as to rebuild voter trust and confidence in democratic and market institutions. This support is vital to the continuing existence of our democratic system and the ability of our society to function harmoniously. If government cannot be open and trust the people to keep it accountable, then what chance is there for the people to trust in government?

This bill will breed confidence and promote investment. Public reaction to the recent banking royal commission has demonstrated that increasingly large numbers of Australians feel at odds with our banking and financial sectors. Now more than ever it is imperative that Australians be reminded that structures and bodies such as ASIC are in place and are being supported in their role of promoting proper conduct and enforcing laws. Only through having a strong, transparent and equitable financial sector can we hope to continue attracting vital foreign investment and ensure that companies want to come to Australia and employ Australians.

As of December 2017, Australia is ranked 14th in received foreign direct investment stock, ahead of the likes of Italy and Russia, but behind the likes of Belgium and Canada. It has often been said one of the major attractions of Australia to foreign investors is its stable political and financial institutions, and transparent governance systems. This will only continue to be the case if the government is committed to ensuring that Australian government standards are high and our financial sector is fair and transparent, and this government is committed.

There is too much at stake for us to rest on our laurels. In this day and age of fiercer than ever global competition, if investors do not deem Australia a suitable destination for their money, they will look elsewhere. The value of ensuring Australia has a functioning, open and fair financial sector is there for all to see. We the government must do all we can to support independent bodies such as ASIC and provide the framework for them to operate efficiently and equitably. This bill will serve as an important step to improving ASIC and its capacity to raise funds and charge fees in a transparent manner. Crucially, the bill will demonstrate this government's commitment to good governance and public taxpayer money being spent fairly, sensibly and effectively. These are notions that all Australians should support; hence I am proud to support this bill and I commend it to the House.

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