Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

by leave—Increasing Australia’s long-term productive capacity is the key to maintaining downward pressure on inflation and, therefore, downward pressure on interest rates. As Labor announced prior to the election, a key element in the government’s plan to increase Australia’s productivity is our deregulation agenda.

For the first time, Australia has a cabinet minister for deregulation. This high-level oversight of the government’s deregulation agenda is essential for getting things done.

The Minister Assisting the Finance Minister on Deregulation, Dr Craig Emerson, and I are working in cooperation with the states and territories through the Council of Australian Governments Business Regulation and Competition Working Group to tackle areas of regulatory duplication or inconsistency between different levels of government, such as occupational health and safety laws.

At the federal level, we are already at work undertaking a stock take of existing regulation and taking action where we find unnecessarily burdensome or ineffective regulation.

In partnership with the Minister for Superannuation and Corporate Law, I have set up the Financial Services Reform Working Group to cut back 50- to 80-page product disclosure statements to the essential information that consumers actually need to know.

And, in the coming months, I will be working with other portfolio ministers to deliver better regulation and better outcomes for the Australian community.

The Rudd Labor government is working towards a culture of continuous regulatory improvement. Under our government, we want more productive relationships between regulators and those they regulate. We want to actively seek out and respond to ideas for improvement all the time.

An important part of this commitment to better quality regulation is ensuring that any proposed new regulations are thoroughly scrutinised so that they are introduced only where necessary and at minimum cost to business and consumers.

I am pleased to announce to the parliament today further details of Labor’s commitment to the best practice regulation requirements and the continuing role of the Office of Best Practice Regulation in their administration.

The Rudd Labor government fully endorses the six principles of good regulatory process identified by the 2006 Banks Taskforce on Reducing the Regulatory Burden on Business.

These principles state that governments should not act to address problems until a case for action has been clearly established. In acting, governments need to consider the benefits and costs of a range of feasible policy options and then select the one which provides the greatest overall net benefit to the community. Effective guidance should be provided to regulators and regulated parties about the regulation’s policy intent and expected compliance requirements. Then there should also be mechanisms to ensure regulation remains relevant and effective over time as well as effective consultation with regulated parties at all stages of the regulatory cycle.

The Australian government’s Best Practice Regulation Handbook, released in August 2007, sets out best practice regulation requirements in line with these principles. The Rudd Labor government is committed to not just maintaining but further strengthening these requirements.

Since Labor took office last year, the Office of Best Practice Regulation, or OBPR, has moved into the Department of Finance and Deregulation. This arrangement better reflects the central role of the OBPR in improving the quality of new regulation through administration of the best practice regulation requirements.

Despite this administrative change, the OBPR will retain its distinct identity. It will continue to be a one-stop-shop to assist departments and agencies to meet the government’s requirements and to assess and report on compliance.

Compliance with the procedures and processes outlined in the Best Practice Regulation Handbook remains mandatory for all Australian government departments, agencies, statutory authorities and boards that make, review or reform regulations. This includes not only ‘black-letter law’ but also quasi-regulation such as rulings, guidance notes and standards.

The level of regulatory impact analysis required is greater the more significant the regulatory proposal is likely to be. A preliminary assessment must be undertaken for all regulatory proposals. Proposals likely to involve medium business compliance costs must also have a further full quantitative assessment of compliance cost implications using the business cost calculator or approved equivalent. Proposals likely to have a significant impact require even greater analysis, including compliance cost quantification, to be undertaken and documented in a regulation impact statement (RIS).

The OBPR has responsibility for certifying that compliance costs have been quantified and for assessing the adequacy of RISs. Proposals can generally not proceed to the decision-making stage until OBPR certification has been received.

In performing this role, the OBPR is concerned only with the standard of analysis undertaken. It does not endorse or support particular regulatory options or outcomes. Such deregulation policy matters will be dealt with in a separate area of the department as part of the government’s broader agenda for reducing the regulatory burden on Australian businesses and consumers.

To perform its watchdog role effectively, the OBPR needs to exercise its decision-making functions in an independent manner.

The government has put in place procedures to ensure that neither ministers nor their staff can seek to intervene in or influence the OBPR’s deliberations.

Decisions on the adequacy of a regulatory impact analysis and compliance with the best practice regulation requirements will be made independently by the Executive Director of the OBPR.

As the OBPR is now part of the Department of Finance and Deregulation, the department’s secretary will be able to support the independence of OBPR’s decision making on best practice regulation requirements, helping shield the OBPR executive director from any undue influence, and appropriately advocating and defending the OBPR regulatory assessment process.

The OBPR will also continue to prepare the annual Best practice regulation report. This report outlines compliance with the best practice regulation principles on an agency by agency basis, and its public release is an important element in ensuring transparent and accountable regulation making. Publication of the report will be prepared and authorised by the Executive Director of the OBPR and presented to the Minister for Finance and Deregulation as a final report.

These existing arrangements are important to ensure any new regulation is effective and any compliance burden is as small as possible.

Keeping the regulatory burden down is vital to ensure we do not tie people up in unnecessary red tape and compliance regimes.

In a number of areas the Rudd Labor government is moving to further strengthen the transparency of the regulatory impact analysis process.

Rather than waiting until the end of each reporting year to publish adequacy data, the government will require that, in all but exceptional circumstances, a RIS and the OBPR’s assessment of its adequacy will be made public before regulations come into effect.

The best practice regulation requirements will also be amended to require that OBPR assess and make public its assessment of the adequacy of any post-implementation review.

The government is truly committed to ongoing, continuous regulatory reform. That is why we have put deregulation front and centre of our agenda to improve Australia’s productivity, to keep inflation as low as possible and to remove unnecessary barriers to people finding well paying, secure jobs.

I commend the statement to the House.

Stephen Smith (Perth, Australian Labor Party, Minister for Foreign Affairs) Share this | Link to this | Hansard source

by leave—I move:

That so much of the standing and sessional orders be suspended as would prevent the member for Dickson for speaking for a period not exceeding eight minutes.

Question agreed to.

Peter Dutton (Dickson, Liberal Party, Shadow Minister for Finance, Competition Policy and Deregulation) Share this | Link to this | Hansard source

At the commencement of this government, Prime Minister Rudd outlined a process by which he claimed the incoming government would be more accountable, open and transparent. He said that one of the processes by which the government would deliver on that promise would be for ministers to deliver ministerial statements. At the time, there was no qualification made that ministerial statements needed to be of substance, and today proves that very point. This ministerial statement is certainly light on substance and really is a tick-the-box exercise for the minister.

The coalition welcomes any proposal for genuine deregulation. This statement today focuses on the best practice for regulation the government intends to maintain—which, on the reading of it, is merely a continuation of the practices introduced by the coalition government. This is just another example of ‘me-tooism’. It is proof that the government, even at this early time in its first term, has no plan for the future, and it is proof that it is simply trying to remodel coalition government initiatives and policies. Of course, the question has to be asked: ‘When the coalition has a proven track record of decreasing regulatory burdens on business and increasing productivity, why wouldn’t you?’

In its annual review of reform, Going for Growth, the OECD rated Australia first in terms of both having the lowest overall level of regulation and imposing the least impact on economic behaviour. I quote from the OECD report:

In the last decade of the 20th century, Australia became a model for other OECD countries in two respects: first, the tenacity and thoroughness with which deep structural reforms were proposed, discussed, legislated, implemented and followed up in virtually all markets, creating a deep-seated “competition culture”; and second, the adoption of fiscal and monetary frameworks that emphasised transparency and accountability and established stability oriented macro policies as a constant largely protected from political debate. Together, these structural and macro policy anchors conferred an enviable degree of resilience and flexibility on the Australian economy. The combination resulted in a prolonged period of good economic performance that shrugged off crises in its main trading partners as well as a devastating drought at home. The short-term outlook is for continuing strong growth of productivity and output, low inflation and budget surpluses accompanied by tax cuts.

This flattering testimony from the OECD is slightly embarrassing for the minister, because it not only gives a glowing endorsement to the coalition but also takes the wind out of the minister’s crusade to wind back apparent restrictive regulatory costs on business. In fact, productivity improvements across the economy mean that the average worker now produces over 20 per cent more than he or she did in 1996. That is, what used to take Australians five hours to produce now takes four hours. The minister’s statement does not tell us much, but it does tell us that the government think that the coalition did so well with deregulation that they will continue with the best practice that the coalition introduced.

The minister states that the government endorses the six principles of good regulatory process identified by the 2006 Banks task force. It was the coalition who established the 2006 Banks Taskforce on Reducing the Regulatory Burden on Business; it was the coalition who implemented the six principles of good regulatory process identified by the task force; and, in 2007, it was the coalition who launched the Best Practice Regulation Handbook, which sets out best practice regulations requirements in line with those principles. Now Labor are trying to sell regulation best practice as their own.

The record of the Rudd government so far on red tape is definitely bad. Similarly to their statements about being economic conservatives, the ALP are all talk and no action in this area. In particular, the most important new regulation introduced by the Rudd government—and certainly Labor’s first substantive piece of legislation—the Workplace Relations Amendment (Transition to Forward with Fairness) Bill 2008clearly fails the tests set out in the minister’s statement. The minister has indicated that policy proposals that are likely to have a significant impact should be subject to detailed analysis, including compliance cost measurement, to be undertaken and documented in a regulation impact statement. The transition to Forward with Fairness bill does have an RIS; however, it is totally inadequate by the government’s own test. It is only a couple of pages long and does not measure a single compliance cost change. This is clearly against the guidelines issued only a few moments ago.

Where is the analysis of whether Forward with Fairness will actually reduce business compliance costs, as the ALP repeatedly argues? It is a question that the minister might like to answer. Evidence presented at the Senate inquiry over the past two weeks has highlighted a high level of confusion and difficulty for business, particularly small business, once Labor’s transitional workplace relations legislation is enacted. Business has raised concerns about increased costs associated with the reinvigoration of the award system, as has a member of the Labor Party, with Senator Marshall suggesting last week that the ALP plan for award modernisation without disadvantaging workers or increasing employer costs is contradictory and an impossible ask.

Where is the analysis of the costs imposed on business from the abolition of AWAs and award rationalisation? These huge gaps suggest to me that either the government has no plan for reducing red tape or it knows that its plan with Forward with Fairness will increase red tape and costs on business. Today’s ministerial statement also says an assessment of an RIS will be released publicly before regulations come into effect. Will the government do this for the transition to Forward with Fairness bill? Or will the government put pressure on the Office of Best Practice Regulation to clear the bill, even though the minister explicitly rules this out? I note that two other significant Rudd government changes do not contain an RIS. Those are the changes to tax deductibility for political donations contained in the Tax Laws Amendment (2008 Measures No. 1) Bill 2008 and the removal of the higher education workplace relations requirements contained in another bill.

The purpose of ministerial statements is to deliver a statement from the government, by the minister, on an issue of substance. This is a particularly important issue for all business, not just for large business but, most importantly, for small and medium business. The expectation is that if the minister is going to make a ministerial statement to this parliament to address the very important issue of deregulation and reduction of red tape for small business, then he should make a statement which business can rely on and which business can look to in order to see some substantive outcome. The reality is that this government is full of rhetoric. The Rudd government’s actions on this show that today’s statement is without substance. The minister should take the first opportunity to address the concerns and the questions that I have raised as part of my contribution to this ministerial statement, but the reality still is that this was a policy announcement that was not substantive in nature and was an abuse of process of this chamber. I think that it shows the contempt and the arrogance of the minister so early on. (Time expired)