Peta Murphy (Dunkley, Australian Labor Party) Share this | Hansard source

When I left off in this debate on the Corporations Amendment (Corporate Insolvency Reforms) Bill 2020, I was talking about the number of insolvency events that occur in the construction sector. As someone who represents an electorate with a large number of trades men and women who are sole traders, subcontractors and family businesses, I was very proud of the policy that Labor took to the last election about a tradie pay guarantee. It's really about security of payments, ensuring that those subcontracting tradespeople in the construction industry get paid.

We know that there have been a number of collapses of larger businesses which operate in the construction industry that have left those down the supply chain out of pocket. Labor's tradie-pay-guarantee framework which we took to the last election would implement the best-practice recommendations of the Murray review of security-of-payment laws, accepting three key policy considerations: we need to preserve the cash flow of the party that has carried out construction work or provided related goods and services by enshrining their right to receive prompt payment of progress claims; we need to provide an adjudication process that ensures that disputed payment claims are quickly and efficiently determined so that prompt payments can be made; and we need to protect payments made in respect of progress claims so that parties who receive the payment hold the payment for those to whom it is rightfully due, through a cascading statutory trust.

Labor proposed a federal security-of-payments framework which would be achieved either by harmonisation across the states or by states referring their constitutional powers to the Commonwealth to implement a national security-of-payments framework. A federal government can start that process by putting in place statutory trusts for construction projects which have significant Commonwealth funding. I urge the current government to go back to the Murray review, to look at those policy considerations and to implement those sorts of policies. That would go a very long way towards giving security to trades men and women who need it, particularly now, to pay their rent, to pay their mortgages and to look after their families.

I want to return briefly to the substance of this bill. I note, as my colleagues have, that this bill was presented to this House with a lack of consultation with small business groups and with a lack of consultation with insolvency experts and accounting bodies. There was a release of legislation and regulations for consultation: four days—four working days—and a weekend to absorb and critique complex and very important reforms. That's not sufficient. This is an important reform, as the Treasurer has said. It is a reform that Labor would like to support, but there are concerns that need to be addressed: How is a cash strapped small business is going to pay for restructuring? What protections do suppliers have? How are stakeholders going to know about a company being in a restructuring plan when the company doesn't have to disclose it and the ASIC registers aren't being updated properly? What impacts will this have on credit availability for small businesses? And, with a new class of liquidator created but lesser education and experience requirements, how will creditors and stakeholders be protected?

These measures may well help struggling businesses in the short term—and that's why my colleagues and I won't stand against them—but we do need to remind this government that it will be held to account, and we do need to make sure that any adverse effects of these reforms are addressed. We know that even legislation put into place with the best intention can have unintended adverse consequences, either in the design or in the implementation.

One example, which is being experienced by a small business called Sk8house, in my electorate, is to do with the JobSeeker wage subsidy program. Sk8house applied for JobSeeker in April and were successful. They received a necessary and very important $60,000 worth of JobSeeker payments, only to then be told by the Australian tax office in September that they were reconsidered as not eligible and now owe a debt of $60,000. It's not hard to imagine what that has done on an emotional and psychological—let alone financial—level to a relatively new small business and to the people that run it and their four employees, who have been struggling to keep that business going during the global pandemic. They've been able to open, now that restrictions have been lifted. Roller derby has started up again. It's part of the state program of This Girl Can, to support girls and women to get involved in exercise—not necessarily mainstream exercise. Bernadine and her partner and the people who work at Sk8house are still so anxious about whether their application to the ATO to review that decision, which they say is based on an erroneous assessment of whether they employed staff, will be successful.

When we bring in these measures that are intended to help small businesses, it's really important that they don't have unintended consequences which can make life even worse. This legislation will start on 1 January—provided a couple of safeguards are put in place to stop any unforeseen consequences, because it has been rushed. Labor has moved amendments seeking a review of the operation of the reforms in practice to identify adverse consequences on small businesses and to propose legislative solutions. We want a sunset clause, so if solutions developed by the review are not implemented the measures will expire after two years. I say to the chamber: these are simple, sensible safeguards which would ensure these changes by the government do what they are supposed to do: help small business. Because we know, now more than ever, that our local small businesses need our help.

I want to finish my contribution by reminding everyone to shop local. Over these summer holidays, when many people can't travel for their holidays, as they usually do, take the choice to holiday at home—particularly in my magnificent electorate of Dunkley. We encourage people to visit us. Holiday on the beach. Experience our little sliver of Australian paradise. Support our local boutiques, cafes and restaurants, the new beer hall on Playne Street, Dainton Brewery and That Spirited Lot—I can personally attest to the quality of their gin. Go to Mount Eliza Village—experience the whole world in a small village, with all of the different goods that are on sale. Make sure you go to Langwarrin and go through the flora and fauna park and see just what a magnificent place Dunkley is. Shop local, support our local businesses, and come and visit Dunkley.

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