Stephen Jones (Whitlam, Australian Labor Party, Assistant Treasurer) Share this | Hansard source

I thank all the members who have contributed to this debate. I've had the benefit of being in the chamber while the members for Bean and Bennelong both gave thoughtful and passionate contributions reflecting on the importance of this legislation to constituents within their electorates. I haven't had the benefit of listening to every speech, but those I have listened to have underscored the importance of the reform project. At great risk of causing offence to those members I don't single out, I had the benefit of listening to the contribution of the Chief Government Whip, the member for Lalor, who spoke passionately about the impact that schedule 1 of this bill will have on payday lending, on small amount credit contracts, which is a matter that she has been a passionate advocate for since she entered the parliament in 2013. So I acknowledge that and her longstanding contribution to public policy in that area.

Schedule 1 of the bill introduces new rules that prohibit schemes designed to avoid the application of product intervention orders made under part 7.9A of the Corporations Act 2001 in relation to a credit facility. As many speakers have said, we know that a well-regulated consumer market for credit products is at the core of a strong economy that works for everyday Australians. That's why the Australian government introduced reforms to the regulation of payday lending. That's why we have a reform project on foot at the moment around buy now, pay later products. All of it is about ensuring we have strong competition but right-size regulation to ensure consumers' interests are protected. That is why the Australian government introduced reforms to payday lending and consumer leases through the Financial Sector Reform Act 2022. These changes gave effect to the government's response to recommendations of the 2006 review of small amount credit contract laws and made a range of recommendations to introduce laws which prohibit avoidance behaviour, and that's what these provisions do.

The 2022 Financial Sector Reform Act introduced anti-avoidance provisions with respect to the Australian Securities and Investments Commission product intervention orders made under the National Consumer Protection Act 2009. This bill simply extends these provisions to similar orders made under the Corporations Law. ASIC has made several product intervention orders under the Corporations Act targeting predatory lending and products causing significant consumer harm. This amendment will quite simply ensure that a person or business cannot respond to a product intervention order by engaging in avoidance activity that is not covered by the order but results in a similar detriment to consumers.

The government has an enormous pro-consumer agenda, and I am very pleased to be leading a significant part of that agenda on behalf of the Albanese government. In addition to the protections that we put in place to help people avoid getting into debt spirals with payday loans and consumer leases, we're standing with consumers to fight back against scammers. I see the enthusiastic member for Lyons in the chamber. I see the member for Lingiari in the chamber, and the member for Fowler in the chamber as well—all passionate.

An honourable member: Werriwa!

I should say the member for Werriwa! I am sure the member for Fowler is passionate about these issues, but not nearly as passionate as the member for Werriwa—I am in regular receipt of her correspondence in advance and advocation of the consumer interests of members in her constituency.

It's a big part of our agenda, whether it is fighting scammers, regulating 'buy now, pay later' products, supporting mitigation in disaster-prone areas, ensuring that the insurance market works efficiently, putting in place a compensation scheme of last resort, or ensuring that we put in place schemes to provide justice for victims of financial misconduct. It's part of a broad agenda and this schedule fits within that.

In addition to all of that, we are working to make financial advice more available and more affordable, and schedule 2 to this bill is a part of that work. If you want a good explanation of why that needs to occur, I refer you to my second reading speech or the excellent contribution made just now by the member for Bennelong, who spoke of members of his constituency who are directly affected by these provisions. Specifically, the amendments will remove a disincentive for experienced advisers to stay in the industry and will assist to stabilise numbers within the financial advisor cohort to ensure that we have a pool of financial advisers to mentor, to supervise and to upskill new financial advisor entrants to the industry. It is important. We need them—we need them now. There are five million Australians at or approaching retirement and they will need access to decent financial advice.

Schedule 3 is going to assist in providing competitive outcomes in the current monopoly provision of clearing and settlement services in Australian equities and related markets, particularly cash equities, to ensure that we have competition and, as it emerges, that it occurs in a safe and effective way. An important part of our microeconomic reform project is an equities market. Schedule 3 to the bill will provide ASIC with a rulemaking power, and the Australian Competition and Consumer Commission with an arbitration power in the event that access disputes are unable to be resolved through normal commercial negotiations. ASIC's rulemaking power will ensure that the monopoly clearing and settlement services are provided on a fair and reasonable, transparent, and non-discriminatory basis—a methodology familiar to those who have been engaged in access regimes for otherwise monopolistic service provision. If competition does emerge, the rules will ensure they are safe and effective.

The ACCC's arbitration powers will ensure that if commercial negotiations for access to clearing and settlement service fail, we can have expedient and biding decisions through an arbitration process to ensure a swift resolution of those commercial disputes. Together, these reforms will give regulators not only greater powers but also the essential powers they need to oversee the conduct of providers of critical financial market infrastructure, and will give industry greater certainty about access to clearing and settlement services, the pricing of those services, and the timeliness of commercial negotiations.

Before I move on to schedule 4, I note that other jurisdictions around the world are well in advance of where Australia is on this. Competition is an effective means of ensuring innovation but it is also an effective means of ensuring we have appropriate price discovery and the right pricing arrangements for the provision of these critical services in an open equities market.

Schedule 4 is essentially about technical savings. The previous government left us with the First Home Super Saver Scheme. It sounded good in theory but in practice was too clunky—it was not effectively working, and in many instances the regulator, in this case the Australian Taxation Commissioner, simply did not have the discretion to resolve otherwise what any normal person would have seen as a straightforward matter of fairness and equity. These amendments will afford the Taxation Commissioner and users of the scheme greater flexibility to correct mistakes and avoid adverse financial outcomes, ensuring that people who access the scheme have a very tax-effective way of getting a high-performance savings product as a sidecar to a superannuation fund, and ensuring that it operates in the way parliament intended it to.

With those brief comments, I once again thank members for their contribution, and I commend the bill to the House.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

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