Shayne Neumann (Blair, Australian Labor Party, Shadow Minister for Immigration and Border Protection) Share this | Link to this | Hansard source

I rise to speak on the Treasury Laws Amendment (Working Holiday Maker Employer Register) Bill 2017. For the edification of the House and also those who may be listening, a working holiday-maker is an individual holding a subclass 417 working holiday visa or a subclass 462 work and holiday visa. To be eligible for these visa subclasses, applicants must be between 18 and 30 years of age and be from eligible partner countries. These visas allow holders to work in Australia while having an extended holiday for up to 12 months. It's really a cultural exchange and it's done for the purpose of amity between countries and to have people from overseas get to know the values and virtues of Australia.

The Treasury Laws Amendment (Working Holiday Maker Reform) Bill 2016 passed parliament in late 2016 as part of a raft of bills better known as the backpacker tax package—and who could ever forget it? As part of the package, there was a requirement that set up a legislative framework allowing the taxation commissioner to establish a mandatory registration process for employers of working holiday-makers. Through this registration, businesses would be listed on the Australian Business Register as an employer of working holiday-makers and withhold tax from those employees at the correct rate of taxation. This meant there would be greater protections for working holiday-makers from exploitation at the hands of unscrupulous employers. However, the Treasury Laws Amendment (Working Holiday Maker Employer Register) Bill 2017 seeks to water down and strip away the provisions to protect working holiday-makers in Australia that passed parliament only at the end of 2016. In an attempt to quietly make good on a backroom deal that the government made with an Independent senator to pass the original legislation, the Turnbull government are with this piece of legislation throwing out everything they once stood for.

This comes at a time when there are significant, recurrent and highly publicised stories of working holiday-makers being exploited in regards to their wages, conditions, safety and entitlements. Regrettably, there have even been stories of vulnerable workers being exploited that have not been published or publicised. I've met with workers across the country in my role as the shadow minister for immigration and border protection, including in my home state of Queensland as well as in Bendigo, the Blue Mountains, Perth and elsewhere. What I've repeatedly heard in these meetings is that the current conservative government, the Turnbull government, isn't doing enough to protect vulnerable and migrant workers. Now, out of desperation to do a deal, this out-of-touch government will water down one of the very few protections backpackers have when it comes to their pay. Once again, only Labor will stand up to protect workers from exploitation, including Australian workers, working holiday-makers and any other overseas workers.

Labor will oppose this bill. This legislation is yet another example of the Turnbull government's back-pedalling. I'm sure everyone in this place and the other place can remember the painstaking back-and-forth negotiations about the backpacker tax at the end of 2016. We were forced to endure this because of the inability of the Turnbull government to govern and govern effectively. The prolonged process created uncertainty for farms across the country as well as potential working holiday-makers. The Prime Minister and the former Deputy Prime Minister, the member for New England, did everything they could to try and collapse over the finish line at the end of the 2016 parliamentary year.

With an odd sense of sense of deja vu or like a bad episode of The Twilight Zone, we're back again debating issues surrounding the backpacker tax. The reason we're here is that the government cut a deal with an Independent senator, a crossbencher. We know that, in exchange for the Independent senator's support of their preferred tax rate at the end of 2016, the Turnbull government agreed to weaken the original legislation before it had passed in the first place. In TheSydney Morning Herald on 13 December 2017, a spokesperson for the Treasurer said in relation to this bill:

The government agreed to introduce the amendment after reaching an agreement with the senator to pass the original WYHM—

working holiday-maker—

legislation.

This commitment did not extend to the successful passage of the amendment.

In other words, through the agreement, they agreed to introduce the amendment but they didn't make a commitment to actually see the successful passage of the amendment. You wonder what deal they really did make and how the crossbencher feels about it now.

It's been so long since the bill was first introduced on 16 February 2017 that it leaves me wondering why this legislation has been resurrected and why it's now before the House today. Could it be that the Independent senator is worried? Could it be that the government cut the deal in late 2016 and that particular Independent senator has now realised that the government failed to keep their end of the bargain? I really wonder. It is curious timing that this bill comes before the House at the same time as the government needs the support of the same Independent senator to get its $80 billion handout to the top end of town across the line. It is clear that cutting deals and selling out workers is the norm for the Turnbull government. It is very important to be sceptical of the government's motives in relation to this matter—and who knows?

The amendments before the House today will remove an avenue of protection for vulnerable workers and a method of ensuring greater transparency. It removes the requirement for the public listing of employers registered to employ working holiday-makers, which affects a backpacker's ability to log in online and choose an employer who will charge the correct level of tax each week. Without the ability to check this, backpackers could be out of pocket each week and have to wait until tax time to get their money back.

In an ironic twist, this legislation comes less than two months after the government's Migration and Other Legislation Amendment (Enhanced Integrity) Bill 2017 passed the House. It was a piece of legislation that Labor supported, because it went some way to protect vulnerable workers. They were good measures, but, by comparison, this bill is not a good measure. It sells out workers, it sells out backpackers and it diminishes their rights. Labor will oppose this callous undermining of migrant and backpacker workers—some of the most vulnerable and exploited workers in the country.

Let's look at the precise provisions of the bill. The Treasury Laws Amendment (Working Holiday Maker Employer Register) Bill 2017 amends the bill and A New Tax System (Australian Business Number) Act 1999. There are also subsequent amendments to the Taxation Administration Act 1953. The amendments to A New Tax System (Australian Business Number) Act 1999 repeal a certain provision. That provision, which is called paragraph 26(3)(jc), details whether or not an entity such as a business is registered under section 16-147 in schedule 1 to the Taxation Administration Act 1953 and the date of the said registration. The paragraph will be amended:

… to ensure that the Registrar of the Australian Business Register is not able to release publicly or otherwise provide working holiday maker employer information to a person who applies to have the entry in the Australian Business Register about an entity released to them.

In other words, it's about not releasing the information so that the working holiday-maker can't get that information about the entity which is registered in the Australian Business Register. It means that if someone specifically wants to make an inquiry about a potential employer, to see whether they are registered, the bill prohibits that information being released. The explanatory memorandum itself rails against transparency by explaining that, even when the information about the register is tabled in parliament, this reporting process will not identify any working holiday-maker employers.

The bill specifically goes out of its way to ensure that businesses and individuals who employ backpackers will never publicly be identified. If these businesses and employers are doing the right thing, what do they have to hide? Paragraph 26(3)(jd) details that, if an entity's registration to employ working holiday-makers has been cancelled, this paragraph will be repealed. What this means is that working holiday-makers in Australia will no longer be able to look up whether or not the business employing them is even registered to do so, heightening the risk of exploitation of backpackers. Even if a business has had its registration to employ working holiday-makers cancelled, working holiday-makers will not be able to access this information. The bill strips out vital protections for inherently vulnerable workers.

You only have to look at the explanatory memorandum for this piece of legislation to find out the Turnbull government's only plan to address possible exploitation of workers: expectation. The explanatory memorandum reads:

It would be expected—

expected!—

that … employers of working holiday makers would advise individual employees who are working holiday makers of their status as a registered working holiday maker employer.

It's expected that the employer will do the right thing. It simply beggars belief that the Turnbull government is denying working holiday-makers something it had previously promised to them, a public register that allows for visa holders to review who is registered for working holiday-maker programs, but is then expecting—expecting!—the business to do the right thing: to disclose their registration.

This register would have ensured that about 200,000 prospective working holiday-makers in Australia would be able to be paid appropriately before they even apply for work and have greater protections given the cases and instances of abuse and exploitation we have seen in public. Instead, the Turnbull government have sold out these workers and their protections, as they've done on so many occasions, such as when they failed to do anything about the cut to the penalty rates to some of Australia's lowest paid workers.

Working holiday-makers are vital to Australia's farmers and producers, our regional towns and our Australian economy. Throughout my electorate in the Somerset region and rural Ipswich, and indeed Ipswich central, tourism is a significant employer of local people, and working holiday-makers help keep local cafes, hotels and tourism operators in business. In the first year of their trip, those on a working holiday visa, subclass 417, can choose to do 88 days of specific work in regional Australia, which is more often than not doing seasonal agricultural work such as fruit picking or working in pubs or hostels, often in regional and remote locations. Fulfilling this 88-day requirement is one of the criteria to be eligible to stay for a visa for a second year. The main purpose of these visas, as I've said earlier in the speech, is a cultural exchange opportunity for young travellers who could work to pay their way throughout Australia.

The Turnbull government needs to be doing more to protect workers, especially vulnerable migrant workers and backpackers in regional areas specifically. I recently heard reports in Rockhampton, Gladstone and Cairns, where I was. These workers expressed to me their concerns about the lack of protection for working holiday-makers. There is the desire of locals for local workers to get the first shot at jobs, but locals in these regional areas are concerned as well about the exploitation they've either witnessed or heard about. Our temporary work visa program must not be used as a backdoor way to source cheap labour. It's essential that the government undertake strict labour market testing and temporary skilled workforce arrangements to ensure employers aren't favouring overseas workers over local Australian workers by undercutting wages.

It's important to note today that we had to drag the government kicking and screaming on labour market testing. In my time in this place, the coalition partners have never supported labour market testing. We fought them across two days in this chamber on labour market testing, and we had to defeat them in the Senate. Fortunately, the government has accepted reality and this morning accepted Labor's amendments. We welcome it. It's probably the first time in the 10 or 11 years I've been in this place that the Liberal and National parties have ever accepted labour market testing. Why? Because the budget requirement meant that they had to get their Skilling Australia Fund through. But we welcome their about-face. We also would welcome it, by the way, if they agreed to our 2016 plan for a fairer temporary work visa system, which we took to the last federal election. That's a measure to ensure that, no matter how a person is employed or which skilled visa a person works under, all workers are treated with fairness, respect and dignity.

Our commitment to the integrity of the skilled migration program was further strengthened when we announced in May 2017 that in government we would establish an Australian skills authority. That Australian skills authority would be an independent labour-market testing body that would ensure temporary work visas are only available when there's a genuine skills gap and no local workers can do the job. This ensures local workers get the first shot at a local job while ensuring that the temporary skilled migration program doesn't exploit vulnerable workers.

We implore the government not to weaken the legislation before the chamber today. We are very concerned on this side of the chamber of the potential exploitation or abuse of workers by the passage of this bill. We hear stories about these abuses reported in the media, by unions, by the Fair Work Ombudsman and by concerned industry bodies. The March 2016 report A national disgrace: the exploitation of temporary work visa holders details these abuses in length. The exploitation of these vulnerable workers shows that changes to the working holiday visa programs must offer better protection against unscrupulous employers seeking to take advantage of cheap and vulnerable labour. These are the people who visit Australia, travel around our country, see our stunning landscapes and experience our culture while working their way around the place. They can enter a small rural town, pick fruit and make some money. But, regrettably, they can fall into the most abhorrent exploitation by unscrupulous individuals and employers.

Some migrant workers have detailed their working conditions as slave labour, according to The Guardian. The report Wage theft in Australia found nearly 30 per cent of migrant workers surveyed as part of the National Temporary Migrant Work Survey were paid $12 an hour or less, well below the minimum wage. And news.com.au reported in May 2007 about Matt Workman, a chemist from the UK travelling in Australia with his girlfriend, who was verbally and physically abused by his supervisor. Mr Workman said:

Within our first two weeks at the farm, the supervisor has hit me on the arm and threatened to break my arms.

His negative experiences weren't limited to his time on the farm. The hostel he and his girlfriend stayed at was a place of anguish for fellow working holiday-makers. He told news.com.au:

I have seen people crying, people fear being sacked and kicked out of the hostel with nowhere to go in the middle of nowhere … It is impossible to make a complaint without risking being evicted without notice.

The UK government's Foreign and Commonwealth Office has provided advice online warning tourists heading to Australia on working-holiday visas that occasionally issues can arise. Well, it's far more than occasionally. It's simply not good enough, what the government has done in this space.

Any amendments to legislation that undermine Australia's work-holiday visa arrangements aren't amendments that should be considered in this place, and they shouldn't be supported. There have been claims of psychological and sexual exploitation. There wouldn't be a member in this place who hasn't had people come up to them and tell them about egregious exploitation. I know I have as a local federal member. Some of the most terrible exploitation I've heard in country towns, when I've been doing mobile offices. Even in Ipswich I've heard shocking examples of sexual exploitation and intimidation. In July 2017, the ABC's Australian Story shared the story of backpackers who'd been exploited working on Australian farms. A Canadian backpacker, Chelsey, was offered a job on a grape farm in Mildura. She had to fight off a farmer—her employer—as he attempted to sexually assault her. Marcel, a German backpacker who arrived in Australia in late 2006, lost his left thumb in an accident on his first day on the job in a sweet potato farm in Bundaberg. He said:

The machine had been switched off but was switched on again very quickly and my hand was trapped. When I pulled out my hand my left thumb was missing … I had never done this sort of work before and we were given no more than a 15 or 30 second safety induction.

A 15- or 30-second safety induction is outrageous. Your heart goes out to these people. Recently I met with the members of the National Union of Workers in Melbourne and Bendigo, hearing their personal stories of exploitation. They had faced shocking exploitation at the hands of unscrupulous employers.

While these stories definitely do not occur on every farm across Australia—and there are good employers; we know that—we should do everything in our power, in this place, to ensure that unscrupulous employers aren't able to taint the entirety of the agricultural sector. One way we can do this is by making sure these workers know about things. Knowledge is important. Knowledge is powerful. Knowledge is an anti-exploitation measure. This bill removes that knowledge.

The amendment bill before the House is proof that the Turnbull government can't be trusted on protecting workers, especially working holiday-makers. We believe in a fair day's work. We believe it deserves a fair day's pay with proper conditions to match enjoyed by everyone who works in this country. Labor's plan for a fairer temporary work visa system, which we took to the last election, included measures I urged the government to adopt. We need to ensure that the Working Holiday Maker Program is appropriately regulated and that allegations and instances of abuse and exploitation are properly investigated. We need to properly resource the Fair Work Ombudsman and we need the political will to clamp down on exploitation. The Turnbull government needs to take the abuse of working holiday-makers more seriously and ensure that visa holders aren't having their wages, their workplace safety and conditions or their entitlements exploited.

Having a register of employers registered for employing working holiday-makers is a step in the right direction in cracking down on the exploitation of workers at the hands of employers who are not doing the right thing. It gives migrant workers the chance to make an informed choice, with knowledge about who they should work for and how their weekly take-home pay will be affected by that choice. Instead, this government has opted to go down the path of cheap political trade-offs and pointscoring. It's a government that's prepared to cut a backroom deal on an $80 billion handout to millionaires, to multinationals. The government did a deal with an Independent senator at the end of 2016, and today we're debating the outcome of that deal. It's a play from the playbook of the Liberal and National Parties, which Labor will always stand up against. Only Labor will stand up against the exploitation of workers, including migrant workers, working holiday-makers or other people who come to this country. We will not support this bill. Knowledge is power.

Melissa Price (Durack, Liberal Party, Assistant Minister for the Environment) Share this | Link to this | Hansard source

It is a pleasure to rise to speak on the Treasury Laws Amendment (Working Holiday Maker Employment Register) Bill 2017, but it is so disappointing to hear that the opposition has chosen not to support this bill. This is an issue I've been very vocal about as it has made its journey through this place. Backpackers are a vital component of life in regional and remote areas in Australia and they are often the lifeblood of many small country towns who struggle with the unique requirements of businesses in regional Australia.

This bill is the final act of this parliament in wrapping up this holiday-maker issue. We have agreed to changes following the crossbench agreement with respect to guaranteeing support for this legislation. This bill seeks to commit that employer registration information about working holiday-maker employers will not be made publicly available, and the Commissioner of Taxation will only be able to disclose this protected information to the Fair Work Ombudsman if an entity is suspected of noncompliance with a taxation law. This sensible proposal aims to encourage those businesses who take on working holiday-makers and to alleviate their fears that the government might have been overreaching its oversight of backpackers. As long as businesses who hire working holiday-makers are doing the right thing, doing what they're supposed to do, there should be nothing to fear in that respect. All employers of working holiday-makers will still be required to register themselves with the Australian Taxation Office. Registered employers will be able to withhold tax at the new working holiday-maker rate of 15 per cent from the first dollar of income up to $37,000. This amendment to the original backpacker tax bill does not affect the requirement of the ATO to report this information annually to the Treasurer for presentation to the parliament. This reporting process involves aggregate employer information and will not identify any working holiday-maker employers.

The working holiday-maker reform package passed by parliament last year, which I spoke on in this place, included four elements, the first being that, from 1 January 2017, all working holiday-makers were to be taxed at 15 per cent from the first dollar earned up to $37,000 and then, following that, the usual taxation rates would apply. From 1 January 2017, only registered employers are entitled to withhold tax at the 15 per cent tax rate. From July 2017, the rate of tax on the departing-Australia superannuation payment for working holiday-makers would be increased to 65 per cent. From July, the passenger movement charge would be increased by $5 per non-exempt passenger, up to $60 per passenger.

I recall speaking on this issue some time ago, as we've heard from the Labor Party, when this House passed the Income Tax Rates Amendment (Working Holiday Maker Reform) Bill 2016. The amendment we're discussing today strikes a very fine balance between taxing working holiday-makers at the appropriate level for the work they do and continuing to attract them to Australia. As a government, we had to ensure that we did not create the situation that members opposite had proposed whereby working holiday-makers were being taxed less than their Australian counterparts. This, by now, is pretty much par for the course when we're dealing with the opposition. The Leader of the Opposition, when he was in charge as the minister, was the world champion or the Olympic champion or the Commonwealth champion when it came to issuing 457 visas and taking those Australian jobs.

On this side of the House, we stand up for jobs and we certainly stand up for regional communities. I'd like to acknowledge the many fabulous initiatives in the budget that we heard the Treasurer discuss last night and today. I believe 100 per cent that it's a very good budget for regional Australia. We believe in creating policies that allow regional towns and cities to grow and prosper, and, in truth, many of these towns survive because of the backpackers. I think it goes without saying that we want Australians to take those Australian jobs, but that is not always possible. Backpackers fulfil roles that many locals simply do not want to do. Perhaps this is an area of welfare reform we really need to take seriously—ensuring that Australians who are on welfare take jobs where there are jobs. But that is not the case that we face here today.

The regional communities that I represent have working holiday-makers performing every role imaginable just to keep the wheels of the Western Australian tourism industry running, without a doubt. There are some stunning statistics around what the working holiday-makers are doing when they're working and travelling around regional Australia. They may only stay in towns that they're working in for a short time to fulfil their visa commitments, but they are more likely to donate their time to organisations in those towns, they are more likely to spend their money and contribute to the economy of that town and they are more likely to do the jobs that others in the town won't do. They are indeed a very, very critical asset to keeping regional communities alive. You'd be hard-pressed not to be served by a backpacker if you went to buy a beer, a coffee or a hotel room somewhere in my electorate, so they are critically important to my seat of Durack. These hardworking young people are a resource that regional Australia simply cannot live without, and we need to stand up and advocate for the hard work that they do.

This is a result that I and many of my fellow regional Liberals—my good friend here, the assistant minister and member for Hinkler, the members for Barker, Forrest, O'Connor and Canning and many of my other colleagues—fought very hard for to make sure that we improved the lot of the backpackers and ensured that critical resource was maintained. All too often, regional Australia is overlooked and forgotten. I'm very proud that I've been able to work with the members on this side to bring this chapter to an end. The fact that this policy has already been implemented, not eight months after the election last year, is stunning. I think it indicates how important we on this side believed reform in this area to be. We are a government that's committed to responsible management of our regional communities, the backpackers who work in them and the employers who employ them.

This amendment seeks to address a couple of the key concerns of many business owners, such as that their private business information will become public. The government has heard and acknowledged their concern, and has amended the legislation accordingly—that's what this bill seeks to address. The rationale for the establishment of the register in the first place was to protect young working holiday-makers from exploitation. Young people travelling from abroad and working in Australia for the first time are particularly susceptible to predatory employers. This government has been listening to working holiday-makers' concerns and their horror stories of being trapped in communities by these predatory employers that we hear far too much about, exploiting them for cheap labour and housing them in less-than-livable hostels. But this government has addressed that concern. We are now marketing Australia as amongst the most attractive destinations in the world for young holiday-makers to live and to work.

Make no mistake: we are competing against other nations to appeal to these young people—countries like Canada, the United Kingdom and New Zealand. All of these countries have robust taxation systems designed to give working holiday-makers a low tax bracket. The good news is that we know that our wages are higher, our economy is stronger and our growth is faster. We can compete on an international level with these countries. Australia is leading the pack in more ways than one, but we need to ensure that we remain competitive, because we need these young people as part of our resource pool of workers.

This has been a fabulous result and is a testament to the hard work and the dedication of many regional and Liberal members in this place. As I said at the outset, I'm particularly disappointed that the Labor Party have decided not to support this bill. We on this side do support this bill. This bill is very sensible, and it certainly supports the employers and alleviates their concerns. This whole initiative is a great credit to those on this side—especially the regional members here—who support those regional communities who desperately need the backpacker community. On that basis, I commend this bill to the House.

Wayne Swan (Lilley, Australian Labor Party) Share this | Link to this | Hansard source

I rise to oppose the Treasury Laws Amendment (Working Holiday Maker Employer Register) Bill 2017, which seeks to strip away protections from a uniquely vulnerable group of people in Australia, working holiday-makers. This bill is ripped, if you like, straight out of the trickle-down playbook of the Turnbull government. To businesses who wish to employ working holiday-makers, the Turnbull government says, 'We'll quietly remove the need for you to publicly list on the Australian Business Register.' The Turnbull government says to these businesses: 'You can be a nonentity. You can employ working holiday-makers, treat them however you like and pay them whatever you like.'

Instead of shedding light on the galling practices of these employers, the Turnbull government is going to shed darkness. That's par for the course with this government. At the mention of any movement towards the bright light of transparency, whether it's for big business or for shonky operators, the government recoils like a vampire. The government sides with shonky operators, basically because it's prepared to tolerate this exploitation. We've seen them oppose Labor's moves on tax transparency. When we proposed that public companies tell us what they pay in tax, the coalition ran away from the light. We saw their resistance to transparency, indeed, in the parliament this afternoon, when the Treasurer couldn't or wouldn't reveal the cost of his company tax cuts or the yearly cost of the income tax cuts. We're seeing it in this bill as well. It is a chance for the Turnbull government to step into the light and expose employers who overwork, underpay, harm and mistreat working holiday-makers in this country.

Labor will not take a backward step in exposing and opposing the practices of these businesses. We will expose and oppose the practices of the Turnbull government, as they are, in some instances, allied with exploitative employers. This bill is merely another bungle that the Turnbull government has banged on the back of the backpacker tax. The package that passed the parliament in 2016 required a mandatory registration process for employers of working holiday-makers. Visa holders could check the public register to see if a business was a legitimate employer of working holiday-makers. There are real concerns about the unconscionable exploitation of working holiday-makers by some businesses.

This bill strips working holiday-makers of the ability to look up details of a registered employer and will affect their ability to choose an employer who will charge the correct level of tax and pay them a fair wage. The register was one aspect of the original bill that did allow for greater protection of working holiday-makers against exploitation. Given the significant cases of exploitation in this area, that is why we stand in strong opposition to this bill.

The Turnbull government claims to be the champion of choice, but of course it says for big business, 'You're free to choose,' but it says to workers: 'You're simply free to lose. You're free to lose your hard-fought-for penalty rates for weekend work and overtime. You're free to lose your sense of job security, whether that's safety at work or the security of having a job at all. And you're free to lose your job if the employer can find and exploit a migrant worker who can do it cheaper and who won't complain.'

In this country, almost one in six Australians are underemployed or want to work more hours. One in six—that's almost 1.9 million Australians on the fringes of the labour market in this country. And, if you're aged 15 to 24, you have a one in three chance of wanting more work. That is 660,000 Australians. These numbers are the shame of this government.

We had a chance to reflect on these matters this weekend in Queensland. Last Monday was Labour Day. It was a chance for the labour movement to reaffirm what history tells us: working people can make a difference, and working people can change a country. All of the great reforms of the 20th century came from the labour movement, the unions and the Labor Party working together: a decent minimum wage, Medicare, a fairer and more progressive tax system, a strong voice for working people—the list is long. On Labour Day we acknowledged that the labour movement frequently has to defeat powerful vested interests that seek to crush the voice of the people. Indeed, this bill has been subject to the power of those powerful vested interests in the amendments we are debating today.

For us it's a difficult task because we have to organise against people who are well funded, wealthy and powerful corporations who control the public megaphone, who seek to drown out our voice. But on this side of the House we choose to fight those people, to take them on in the parliament and particularly to take on those who run the Turnbull government, including the cheerleaders and puppeteers in the Business Council of Australia.

In recent years, I've focused a lot on these issues in the parliament. I've talked a lot about the imbalance of power, the imbalance of influence and the imbalance of class. It's not because I'm particularly chippy or resentful, and it's not because I've become a Marxist. It's simply because class is now a live issue in our nation, and I see it pounding the lives of people in the community I represent and around the country. I see it with my constituents. I see it in the youth unemployment figures. I see it in the insecure work which now comprises something like 40 per cent of the workforce. It is a real issue in Australia. It's changing our politics, and it's changing our society.

I've been particularly fired up about it since the global financial crisis because what I have found in our country is something that is quite ugly. It's something that I wasn't prepared to have found but something that I've seen that is new. That is a growing self-interest and arrogance of what I would call an overpaid and overpowerful corporate elite, who are generally the people who are dictating the policies of the Turnbull government. These people have been in the dock at the royal commission into banking throughout the last few weeks. Their arrogance and their blindness of affluence has infected corporate life in Australia.

Of course, these are the people that working people have to deal with every day. They seek to bolster their self-interest at every turn. The culture of too many boardrooms is not just selfish but now obviously ranks with malpractice, as we have seen at the royal commission. There's a sick race to the bottom going on to minimise tax, to casualise their workforces—all the way through that process, barracking for lower wages and, of course, cuts to investments in health and education.

In office, and over the last five years, the Labor Party in this parliament has fought for the big structural reforms that we need to secure a prosperous and fairer economy and society. But at no stage through any of that process have the overpowered corporate elite who run this government put their hand up for the very big structural long-term reforms that are required to secure our future. They wouldn't stick their hand up for negative gearing, a sensible price on carbon, the Gonski education reforms—the list is long. What we do see in Australia, like the rest of the developed world for that matter, is a capitalist economy which is dominated now by a plutocratic family model backed up by an overpowered and overpaid corporate elite. They do want an economy run by the rich, for the rich, and that's what we're getting. And nothing from the budget last night sticks out more than the obscene tax changes put in place to flatten the progressive tax system and hand massive tax cuts to people who earn incomes like ours and well above.

When I was growing up, my father had an attitude about the world he lived in. He went to war. He came back. He was distrustful of the big banks and the big oil companies. His generation had witnessed the Depression and the Second World War. They fought for freedom when they went overseas. They came back. They had plans for a big society, a great society, in which the fruits of that economy were fairly shared amongst working people. They fought for that. They changed it. They fought for it and they were successful.

Over the last 30 years, that has been wound back. The beneficiaries have been a relatively small elite on very high incomes who dictate this government's budget and dictate this government's tax policy. It was there last night in black and white for everybody to see the rank unfairness of it—the destruction of the personal progressive income tax system, where someone on $37,000 would pay the same rate as someone on $200,000! To present that budget to this parliament in an environment where there is growing inequality around the world, which is polarising politics, is simply insane. It shows you how far to the right those opposite have drifted and how far they have come from the national interest.

In this simple bill this one amendment that we are objecting to today says it all. Why couldn't there be a register so we can stamp out malpractice? Why couldn't that continue in the bill? I'll tell you why. It's because some vested interest got hold of them, or some loony in the Senate dictated to them that it must be changed. What I really find troubling about our country, and particularly the activities of organisations like the Business Council, is that at every turn they smear collective action. At every turn they smear the role and importance of government and, in particular, collective action from trade unions. They tell a great lie about our society. They say it's divided between makers and takers. This Ayn Rand view of the world goes to the core of where they come from, how they make policy and how they present their budgets. Of course, they are the makers. And they just think the takers should take what they can get—and business should of course do whatever they want. And that goes back to the amendment in this bill.

We on this side of the House know we need collective action. We know we need unions. There's a power imbalance in our country. Franklin Roosevelt said it all in the 1930s:

Our first truth is that the liberty of democracy is not safe if the people tolerate the growth of private power to the point where it becomes stronger than their democratic state itself.

They are very profound words—and very profound public action flowed from those words. Progressive taxation came from those words. Breaking up monopolies came from those words. The union movement came from those words. But this government is now controlled by trickle-downers and plutocrats. F. Scott Fitzgerald said of plutocrats: 'They think they're better than we'—that is, they think they are the wealth creators and the rest of us are just leaners, hanging around.

Today, I want to say very clearly in this House that history shows that working people can make a difference, and we'll make a difference again. We will run down this budget because of its rank unfairness and because there is a profound sense of unease, insecurity and unfairness in our society. This bill before us today is a reaffirmation of why we need a strong labour movement that's proud of its history and unapologetic about where it stands and who it represents: the economic interests of working people. History will be made again as we turn back the trickle-down policies of this extreme right-wing government that occupies the government benches.

Rowan Ramsey (Grey, Liberal Party) Share this | Link to this | Hansard source

That was no doubt a vintage performance from the member for Lilley, pitching and showing quite plainly that the Labor Party is moving further to the left, fears the by-elections that are approaching it and is determined to make a stand against the Greens. He closed off by saying that this government, the Turnbull government, is an extreme right-wing machine. It is not a view that is shared by the entire electorate. I think this government is entirely centrist, so I reject those remarks completely. But it was very stirring. It would have been very good when he was at university.

On the Treasury Laws Amendment (Working Holiday Maker Employer Register) Bill 2017, let me speak for a start about working holiday-makers in my electorate of Grey. They are absolutely essential. I'm not sure they should be, but they certainly are, as seasonal farm workers and fruit pickers, working in small wineries, as harvest helpers in the grains industries and working at grain receival sites. Many of them just would not operate without the backpackers, quite frankly. They work as jackaroos on remote pastoral properties and as shed hands.

But probably the most critical of those backpacker workers in my electorate are those that work in the tourism and hospitality industry, particularly those that work in the more remote areas. Let me say that if we go north of Port Augusta—a very important tourist area for South Australia and the nation, with the northern Flinders Ranges and towns like Coober Pedy, Innamincka and Oodnadatta—you would be well aware of them. These are important places. They are important service spots just so people of this nation and overseas nations can explore our outback. By and large, the operators that work in those areas provide quality service. There are some very good and luxurious tourism operators that work in these areas. But, quite frankly, they just cannot get Australian workers to take the jobs. Often they are not full-time jobs, because the tourist industry gets pretty quiet over the summer months when the temperature gets up towards 50 degrees, but they need a source of labour.

It's a constant conundrum to me as the member for Grey that we just can't entice our young unemployed people to have a go, to venture forth, to leave the fires of home and to go and have a look what the Australian outback looks like, or other areas for that matter. This could be the most important step of their lives. At this stage, the latest figures I can find are that we have about 14 per cent youth unemployment in most of the centres across Grey. Starting your working life with a long period of unemployment is likely to have lifetime ramifications. You can imagine. An employer advertises a job. A 23- or 24-year-old wanders in, having finished education at high school, and the employer says to him, 'What have you been doing for the last five or six years?' 'Well, nothing. I've been unemployed.' They will go immediately to the back of the queue, because that potential employer thinks this person can't get out of bed. It may not be a fair assumption, but it is a hole on the potential employee's CV. It could be filled by all kinds of opportunities that exist out there in the economy. It may be in the part-time economy, but often those jobs lead to fuller jobs. So I don't know why we cannot seem to excite that young, unattached brigade to go and have a go. I sat next to a woman—I don't want to offend her, but she was around 30 years old—up at Coober Pedy just last weekend. She had left the city. She wanted a job. She went out and had a go. She can now drive a four-trailer road train. What a story! She said, 'I'm having a go at being a jackeroo at the moment.' Being prepared to get out and have a go has turned this individual, who was a city liver, into someone with wide experience. That's what our youth should be doing.

I know we're speaking about the backpacker trade here now, but I draw this link because it is of great concern to me when I see so many people not taking opportunities to enhance their lives and to grow their possibilities. I ran a survey for 18- to 30-year-olds a couple of years ago. One of the questions I asked was: if there is no employment near where you live, should you be expected to move to find a job? It was very concerning to me that over 70 per cent of those replied no. It really makes you wonder what their expectation of the world is. Is it that the government should supply a job? To do a job you actually need a chore; you need a task. Governments can do that, and some governments have done it in the past—they supply the job of digging a hole and then they get another gang to fill it in again. But if you want proper employment you need to be doing a useful task. It concerns me that 70 per cent of those young people said, 'No, I think somebody should find a job for me close to home.' It's very concerning because all these jobs exist, but we are having to use imported labour to fill them, largely through the backpacker trade.

Mr Deputy Speaker Georganas, you're around my vintage, so I'm sure you would remember Professor Julius Sumner Miller. As the American professor would have said: why is it so? It is a great conundrum. Why is it so? Why can't we galvanise these people? I don't want to get drawn into the debate and I've certainly wandered a fair way off the topic today, but it is interesting that some have been making the case for lifting the Newstart allowance, and they're perfectly entitled to do so. By the same token, we can't get people to take that risk and have a go, and it just makes you wonder what the drivers are. Where's the compelling piece of government policy that will get people to engage? At the end of the day, I strongly back the case for the businesses in these remote communities that can't get people to work with them, because Australians, for whatever reason, don't particularly like that line of work, to be able to access this itinerant, if you like, occasional labour pool.

This bill does address some of the issues that have arisen as a result of striking a withholding tax that is applicable, especially to holiday-makers. That rate, of course, is 15 per cent on the first $37,000 of income. For an employer to apply this rate, they must be registered as a working holiday-maker visa employer. The alternative for that employer, if they choose not to be registered, is to withhold 32 per cent, so it's an obvious incentive for working holiday-makers to seek out employment with these employers. This bill and the working holiday-maker employer register are designed to make sure they are not exploited. Most employers—certainly the ones I know—do the right thing. They are very pleased to have these people on staff and treat these employees as we would expect them to be treated. But we're all aware of some very high profile cases where that has not been the case. They've been highlighted on some very high profile television shows. This government has no tolerance at all for that kind of behaviour.

This legislation and the establishment of the working holiday-maker employer register are about stamping out that type of behaviour and empowering the worker. It links employers to the tax office. They will supply their employer records to the tax office so that government, through the tax office, can monitor what they're doing. We will know where to watch for those people who are likely to exploit this labour force. We will be on their case. I have no tolerance for it—absolutely none—and that view is shared by my colleagues.

Empowering workers reduces the likelihood of abuse. Less offending means better support from the public for this very important workforce contribution. To explain that, if we had high-profile cases popping up on television and showing the exploitative nature of employers, public support for backpackers working in Australia would basically fall away and the businesses that rely on this labour force would be at threat. Like most things with government, it's important that we get it right so the public has faith in what the government, the legislation and the bureaucracy are doing. At the end of the day, this workforce supports very viable and very important businesses that sit in my electorate and every other electorate around Australia, I should imagine, but particularly in regional and remote electorates.

I support the opportunity for people to come to Australia on a holiday, work while they're here, learn a bit about our culture—some people would say that in some places they would learn about the lack of culture—and learn that we are people who respect all who come to this nation and that we look after them properly while they're here. I support the legislation.

Lisa Chesters (Bendigo, Australian Labor Party, Shadow Assistant Minister for Workplace Relations) Share this | Link to this | Hansard source

Here we are again, having to deal with the government's incompetence when it comes to backpackers and backpacker visas in this country. It was on budget night a few years ago when we sat here in horror as the Treasurer announced a 32 per cent tax rate for backpackers, which of course we knew would decimate the labour that is required on our farm industries. From beginning to end, this government have been appalling when it comes to backpackers and the backpacker tax. It demonstrates that they completely misunderstand the purpose of the visa and why people come here. Originally, people came here on a working holiday for a cultural exchange. Young people under 30 would come over here independently and they'd work a bit and they'd travel a bit. But it has changed dramatically, and the government have just incentivised that in so many ways.

Labor is opposed to this legislation for a number of reasons. One of the reasons is that it is a dirty deal. It is a deal that ensures the exploitation of holiday-makers, and people wanting to understand more about a potential employer will find it hidden. We need more transparency in this sector, not less. We all have seen the horror stories brought out by the media. I want to acknowledge the role the media has played in exposing some of the absolutely heartbreaking experiences of guest workers and holiday-makers in this country. In the agricultural sector there have been some horrific examples of exploitation, threats of violence, violence and, in some cases, sexual assault.

I want to acknowledge that it is not all growers. In fact, most growers and producers are outraged by the exploitation. I met last week with AUSVEG and the VFF at a roundtable in Melbourne. They said, 'We need to end this stain on our industry. These dodgy growers are making it hard for the rest of us.' One of the other comments that was made by AUSVEG and the VFF was that we need to find a skilled workforce that can work on our farms every year. The problem is that the government have made our ag industry beholden to one visa. They have failed to come up with a decent agricultural workforce policy. For a lot of our farmers, this is the only access that they have to labour, not just for harvest but all year round. Some of the growers in Victoria say that they feel like they're camp counsellors. Backpackers rotate around farms trying to get their 88 days. They don't have to work for just one employer for the 88 days. Farmers may hire someone in good faith and invest in the training, and after four days or 10 days that person quits because they've reached their 88 days and they can get their visa extension. That's just one of the problems with the way in which this visa has been constructed. We all remember the debate. It was the Farmers' Federation and the growers saying, 'Do not touch our backpackers.' But designs in the way this government have changed this visa mean that fewer and fewer people are working on the farms.

One of the other changes that the government had as part of this package was allowing backpackers to qualify for the extension, to do their 88 days, by working in northern Australia. So as a young backpacker over here you've got the choice: pick fruit or pull beers. Guess what they're doing, Deputy Speaker? They are working in the pubs and hospitality outlets in northern Australia. They are not going out and doing the hard work on farms. Why would you? If you get to qualify for the second year, why would you go work in agriculture? I can understand why our farmers feel cheated when it comes to this government and how they've behaved around the backpacker tax.

There is a lack of absolute transparency when it comes to backpackers and their experiences. The Fair Work Ombudsman doesn't have enough resources to investigate the exploitation that is going on in the sector. This is why this bill is before us. It's going to make it harder for there to be transparency.

The other problem that we have with the backpacker visa is the fact that it is now being used as a labour visa. We have people coming in in bulk numbers from places like Taiwan, Korea and Bulgaria, and working in industries where they are literally taking jobs from locals. There is a renewable energy solar farm that is being built outside of Townsville by 400 Bulgarian backpackers. No young, local, unemployed people in Townsville were given that job opportunity. No local electricians were given an opportunity to train and recruit apprentices. There are no Australian workers on that job; just 400 Bulgarian backpackers. When they finish that job, they'll be put on a plane and sent somewhere else.

The backpacker visa in this country is being used as a backdoor to cheap labour. We have to look at what is happening in our food processing and manufacturing sectors. Don KR and Hardwick Meatworks are in my electorate. Don KR had a union collective agreement where casuals were being paid a certain rate. Then they found out that they could use a labour hire firm that paid the award rate. The difference between the award rate and the union rate was $5 an hour. So those workers got ripped off and the locals lost jobs, but it's completely legal. The way in which backpacker labour is being used in our country to undermine collective agreements and to undermine locals for local jobs is simply outrageous. Yet what we've got before us is not a bill that addresses that issue; what we have before us is the cover-up—the cheap deal that they've done in the Senate. That's what we've got before us.

Then there is the example of Hardwick. Hardwick is a meat processor in my electorate. They directly employ all of their backpackers. They said, 'If we have to have people who are here on working holiday visas, we will at least pay them the same as the other workers.' Credit to them for doing that. However, they are now struggling to recruit people because of a quasi relationship. Because of the way in which labour hire recruits these overseas backpackers to come into our country, they now are struggling to get access to people coming in. In saying that, another thing I want to acknowledge about Hardwick is that they are a bit like our farmers in that they would actually prefer to have permanent residents working in these jobs. Recently they hired a number of Karen refugees who, through our humanitarian program, have settled in Bendigo in central Victoria. They are now recruiting Hazaras who have settled in Bendigo in central Victoria. They are now starting to take on some of this work. The last time I visited Hardwick, just a few weeks ago, they had six backpackers come on and six backpackers leave. The constant cost involved in training backpackers to work in food manufacturing, agriculture and other industries because they are trying to satisfy their 88 days is costing business a lot, and it is costing productivity.

This is the problem for this government. It is always just short-sighted policy. They're not thinking long term about work and having a skilled workforce. They're not working with industry to say, 'What are your labour gaps?' The previous speaker said, 'I don't understand why we can't get young Australians to work in these industries.' It is probably because you've gutted TAFE. Even last night, in your budget, you cut an extra $270 million from TAFE. It is probably because you've completely smashed regional universities. It is probably because you've broken the trainers that connect young people to the jobs that exist. You've not only done that—it's a double whammy—you've also created the incentive for labour hire companies to come in and undercut the collective agreements that exist in these places.

What we need to get back to in this country is this visa coming back to its original purpose: allowing young people to come here for a working holiday, work and travel. We have reciprocal rights, with young Australians going over to the UK. But what we are seeing happening with people on this visa is either exploitation or cheap sources of labour. It really concerns me when I hear examples of people who are working in social work for the New South Wales not-for-profit sector. They're working as social workers, and the visa that allows them to work as social workers is the working holiday-maker visa. That's not a cultural experience. We have serious issues in our country if the only way that you can engage someone to work in an industry is through a backpacker visa.

We have to have a serious look. If we have a skills shortage in our country, what is wrong with recruiting someone to give them the opportunity to live here permanently? Why make them go through the process of working for two different employers for six months? Why make them go through the process of working in northern Australia or in agriculture for 88 days? If there is a skills shortage in an industry, let's be serious about that. Let's work out if we can train local workers for it and, if we can't get locals to do the job, let's look for someone who's from overseas but give them the chance to permanently move here. Give them the chance to stay.

All employers of working holiday-makers are still required under this proposal to register with the ATO to ensure that they pay their tax. However, it removes the ability for a working holiday-maker to look up the details of their employer to make sure that they are paying the correct level of tax and are an employer of choice. Senate inquiry after Senate inquiry has exposed the exploitative nature of this visa. We as a country need to get serious about cracking down on that exploitation, but nothing before us deals with that. The backpacker tax is one of the biggest failures of this government in the way in which it has decimated the workforce that our farmers and the agricultural industry need, and the way in which it has been exploited and is literally taking locals from local jobs.

There's a lot of talk at the moment about meat processing. I used the example of my electorate, but in the electorate of New England there are 100 per cent labour hire meat processors in that electorate, with people who are here on a backpacking visa. Those workers have come here to make money and to take it home. That's a long way from the original intent of the visa, which was about a cultural exchange. The way in which this visa is being exploited and manipulated by big business is wrong. If we have a skills shortage or a labour shortage in this country, as I have said, and we cannot fill it with local workers first then we should look at a visa, but a visa that is fair and that gives people the opportunity to migrate here.

We are a country that's been built on migration: Ten Pound Poms and our postwar migrants that came here. People came here as skilled migrants and, if they left the country, we said, 'Okay, we've sponsored you; now you have to hand it back.' Today the experience for migrants is much, much worse. Today the experience for migrants is too often a series of visas which see them exploited. As a country, we have to get serious about how we manage migration. This bill that the government has put forward, as I've said, is basically trying to push it further underground. It is going to make it harder for workers to understand and know more about their employers. Given these significant cases of exploitation, Labor is saying we strongly oppose the measures in this bill. We have to have transparency. We have to give young people who are here as guest workers the opportunity to know who their employer is. We also have to review the exact nature of this visa. It has to be restored to its original intent, which is about a cultural exchange. I do share sympathy with our good growers that are out there and with employers like Hardwicks, who are now struggling to recruit people to come and work because of the changes that this government has made.

When I was in Cairns a few weeks ago meeting with workers about problems with labour hire, I met a young woman who actually was working in Indigenous health. She's over here from the United States. For her to stay for the second year, though, she had to work 88 days in hospitality. It just doesn't make sense. Once upon a time, she would have gone and worked on a farm, but why would she, given that she can work in hospitality? We have to get serious about our migration program in this country. We also have to get serious about this visa. It needs to be restored to its original intent of being a cultural exchange, a holiday-making visa. We want to see an end to the situation which we have at the moment where big labour-hire firms are recruiting bulk numbers of workers to come over here and work in areas which young Australians could be working in. Young Australians do want to work at Hardwicks. Young Australians do want to work at Don KR. Young Australians do want to be social workers and work as schoolteachers. But, at the moment, they can't, and, in many cases, it's because of the exploitation of backpackers.

Keith Pitt (Hinkler, National Party) Share this | Link to this | Hansard source

I'll make a brief contribution. I, of course, acknowledge my good friend the member for Moreton for giving me the opportunity to jump the queue. I'm taking that opportunity for a couple of reasons. The first is that those opposite seem to have a bit of a memory of convenience around this issue. I've sat through about 60 minutes of this debate now, and the way that it's been put is that action has been taken by people like the AWU. It wasn't the Australian Workers' Union. It's been put that action has been taken by people like the now CFMMEU. It wasn't them. It might have been United Voice. I can tell you that it wasn't United Voice. It wasn't any of those organisations. The crackdown on the exploitation of foreign workers in this country commenced with my colleagues on this side of the House.

As one of the speakers said in recent contributions, there have been any number of reports into this issue. There have been Senate reports after Senate reports, inquiries and standing committees right back to the late 1990s, when it was raised by the former member of this House Philip Ruddock. But what I can tell you is that some of my colleagues, including the now Minister for Veterans' Affairs, the now Deputy Prime Minister, Mr McCormack, and my good friend and colleague in the other place Senator Barry O'Sullivan, kicked this off with industry, calling for direct action and, in particular, a multijurisdictional task force to crack down on exploitation of foreign workers in this country. That is precisely what happened.

We worked our way through this with industry. We consulted with them as to what they needed. What they didn't need was more red tape. What they didn't want was more people affecting how they work and what their operations are each and every day—delivering jobs and, of course, building the economy in this country. So the multijurisdictional task force we called for at the federal Nationals conference some years ago, with unanimous support, was delivered by this government. Taskforce Cadena has been a real success in cracking down on foreign worker exploitation in this country. If you wanted to look at one case in particular, it would be that of one Mr Emmanuel Bani and the people from Vanuatu who he exploited, who he left on the side of the road, who ended up in my office, who hadn't been paid for months, who were disregarded and left without their passports. The absolute outcome of that is Mr Bani has found himself in court. He has been prosecuted successfully, as he should have been. But it is this side of the House that is cracking down on foreign worker exploitation.

In fact, I will give a shout-out and, certainly, a call-out to Keith Ballin, the representative of the AWU in Bundaberg for many, many years, who did come to see me after we took action on this issue. I'll acknowledge that he put out his hand and said: 'We will help you on this issue. Come to us again.' I certainly acknowledge that that was a very gracious and generous offer. But it was the people on this side of the House who took action, and I think we should acknowledge the people who were willing to put themselves out in front of the media. The member for Blair's contribution was almost accurate. It wasn't 7.30; it was ABC's Four Corners. The reason I remember it so very clearly is that I was on it, talking about the exploitation of foreign workers and what needed to happen. We had all heard the horror stories around those situations, and they were unacceptable.

What have we done? We introduced Taskforce Cadena, a multi-jurisdictional crackdown task force, which has been successful. I acknowledge the member for Gippsland—Taskforce Cadena has been active in Gippsland, in the Riverina and in areas right across this country. We added on an additional $20 million to the Fair Work Ombudsman so they could do their work. There is still work to do; I absolutely acknowledge that. One of the things that stood out for me in the budget last night was the change to cash payments—no more than $10,000 will be allowed in future. That will address two critical things: the accumulation of cash and phoenixing. If you can't pay for substantial components, equipment and machinery with cash in this country, that will eliminate a lot of the problems we have, particularly in horticulture.

I also acknowledge another contribution, which stated that this is just a few bad seeds, that it is not reflective of the horticulture industry in this country. The majority of our growers are out there doing the right thing, working very hard for this country. They take a lot of risk. They employ a lot of people. But we do need to ensure that they are able to act on a level playing field, and that is what we are doing as a government. This bill continues that good work, and I commend the bill to the House. But it should be acknowledged by those opposite that it was this side that took action on cracking down on foreign worker exploitation in this country.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak on the Treasury Laws Amendment (Working Holiday Maker Employer Register) Bill 2017, and I'll say from the start that Labor opposes this bill. Whilst I acknowledge the contribution of the member for Hinkler and the personal interaction that we've had on this particular topic—I've got a big toe in his community and I work in his community. I acknowledge that, on a personal basis, we have worked well on this. But I don't think we'll ever celebrate governments cracking down on people who are breaking the law. That's like giving people a pat on the back for breathing. Governments should always punish people who break the law.

This bill before the parliament essentially introduces changes to the backpacker tax from the package that passed parliament back in 2016. I think it's important to view this next instalment in the context of the entire backpacker tax fiasco, which sounds like a holiday novel. Sadly, it's something presided over by the Turnbull government, and it's been a disaster from the beginning, with the backpacker tax first appearing in 2015, announced by the then-Abbott government in the 2015 budget. Since then, the government's got a new leader but old ideas. It's still cuts, cuts and more cuts—cuts to education for every kid, totalling $17 billion, right across Australia, including $15 million from schools in Moreton; cuts to higher education and universities, such as $92 million from Griffith University, of which the Nathan campus is in my electorate, and TAFE, include $270 million in additional cuts announced last night; cuts to hospitals, including over $3 million from QEII, which is in Moreton; and cuts to Medicare totalling $2.2 billion. Thanks to the freezing of the Medicare rebate, everyone will be paying more to see a GP at a time when wages are stagnant. There are also proposed cuts to Queensland's share of GST funding, potentially ripping $1.5 billion from the state's economy, and the proposed cutting of the energy supplement, taking $375 every year out of the pockets of pensioners.

In the 2015 budget announcement, the then Abbott government proposed a 32.5 per cent tax on backpackers. There was failed negotiation after failed negotiation, and, on the last sitting day of 2016, it was jammed through in a secret deal with the Greens political party. Yes—the coalition doing a deal with the Greens political party! The shadow Treasurer, the member for McMahon, described it as a special mix of arrogance and incompetence from the government of the day. Labor, responsibly, had offered the government many different compromises to stop the outrageous 32.5 per cent slug on the industry, which would obviously be passed on. We offered 10.5 per cent or even, in the spirit of compromise, 13 per cent.

What did the Treasurer say? 'Oh, no, they'd both be far too expensive.' What did Treasurer Morrison do? It's quite astounding. He did a deal with the Greens political party to water down superannuation measures and to spend $100 million extra on Landcare. I love Landcare; it does great work; I understand that. But this deal, the Morrison deal, ended up costing the budget more money than doing a deal on 13 per cent would have or doing a deal on 10 per cent would have. It takes that special mixture of arrogance and incompetence to get a deal that has a higher tax rate while making less money for the budget bottom line.

This is a budget that used to be at emergency levels of debt. Do you remember that, Deputy Speaker? Remember that old debt-and-deficit truck? Remember the pictures of Mr Turnbull out in front of the debt-and-deficit truck? Where is that truck? Is it locked in a bunker somewhere, its diesel engine ticking over, chugging away, collecting parking fines in a parking lot somewhere—fines that my grandchildren's children will have to pay off? No.

Anyway, back to the backpacker tax: this hapless coalition government managed to negotiate a deal that was worse for taxpayers, worse for farmers and worse for the tourism sector, a trifecta of trip-ups. So what is there left to do—make it worse for the workers too? It's an idea that this coalition government is never too afraid to tackle: making life worse for workers, making life worse for ordinary Australians. When it comes to properly funding education, when it comes to funding health or infrastructure, it goes missing. But, when it comes to bashing workers, it turns up in droves. We've seen negotiation after negotiation, and this floundering Turnbull government yet again wants to remove an avenue for the protection of workers and something that provides greater transparency.

The coalition are seeking to deny working holiday-makers something they promised: a public register that allows visa holders to review who is registered for the program. This register ensures, before they apply for work, that they are paid appropriately. It ensures that they can have greater protections, given the cases of abuse and exploitation in this area. As I mentioned at the start of my speech, I have a particular interest because I have in my electorate a significant Taiwanese community and Korean community, and many of their friends or relatives come and work on Australian farms. Because of that, I went for a visit to Bundaberg and the Lockyer Valley with representatives from the Taiwanese community to find out how people were being treated. I'll come back to that in a little while.

The backpacker tax package that passed parliament in 2016 allowed visa holders to check the public register to see if a business was registered for employing working holiday-makers. This amendment, outlined in this bill, is part of a deal that secured Senator Leyonhjelm's support for the original package—yet another deal from this government, which is willing to sell out to anyone for almost any price to get something through the Senate. It needs to read some negotiating books.

There absolutely needs to be a better process for ensuring that greater protections and information are in place for working holiday-makers. Why? It is not just because it's the right thing to do. That's a pretty good start. But we need to do it because these backpackers become our de facto ambassadors forever. If they have a horrible experience here in Australia, they will tell the world. They will tell their home. They will tell everyone that they meet what happened to them in Australia. That's why we need backpackers to do something productive, get paid and have a good time but also be great ambassadors for us.

This bill removes these protections. It removes the ability of backpackers to check the register and leaves them in the dark again. Unsurprisingly, the Turnbull government is prioritising—guess what?—big business over workers. So now the coalition is revisiting the dark days of the backpacker tax fiasco. This hillbilly-harbourside alliance is back in town.

Darren Chester (Gippsland, National Party, Minister for Veterans' Affairs) Share this | Link to this | Hansard source

That was solid!

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

You liked that one, Member for Gippsland? The impact of fewer backpackers working in Australia has dire consequences for our horticulture growers. I know this because the Brisbane Markets, where a lot of this produce ends up, are in my electorate, and I've had feedback from several growers about some of the concerns they have, as I also had on my visit to the Lockyer Valley and Bundaberg. Growers face the prospect of seeing their fruit rot on their trees if they don't have anyone to pick it. The uncertainty that the Turnbull government continues to create has caused unnecessary stress for farmers, whose very livelihoods are at stake, especially—I am informed by my colleagues—in Tasmania but also in the north-west of Western Australia and some of the more remote parts of Queensland and no doubt everywhere in between.

Sadly, the Turnbull government, and particularly dumped former Deputy Prime Minister Joyce, handled this issue very badly. He is not a great negotiator. He failed to fully consult with stakeholders or to do any modelling when he put forward proposals to tax backpackers. When this went on, we saw that the Nationals—that once-great party of the bush and the home town I grew up in—completely ignored their constituents, the growers. The premise of any proposals completely ignored the fact that backpackers who come to Australia to work, usually then spend the money they earn in Australia and—guess what—often spend it in the bush. If you're out in St George picking grapes, you stay in St George and spend it in the pubs there and in accommodation there. It is Australian businesses that benefit from these backpackers' holidays, and all the goods and services sold to them—the holiday products, the alcohol, the food, the tourist experiences—attract GST, support a lot of small businesses and are good for our economy.

While I mention the GST, I again appeal to Prime Minister Turnbull and to all of the Queensland Liberal National Party MPs and senators to drop any plans to slash Queensland's fair share of the GST, which is flagged as making our state's economy $1.5 billion worse off. That would be the equivalent of losing 5,000 teachers, 5,000 nurses, 3,000 police officers and 1,135 firefighters. It's clear that Prime Minister Turnbull and the LNP government don't care about frontline services in the Sunshine State.

Before us today, we have the Liberal government and their very muted National Party coalition partners revisiting this backpacker tax policy area. In 2016-17, a total of 211,011 subclass 417 and subclass 462 working holiday-maker visas were granted. That's a 1.7 per cent reduction compared to 2015-16, which in itself saw a 5.4 per cent reduction from the preceding year. So there was a one per cent reduction in first working holiday visa grants, subclass 417, to 157,858, and a six per cent reduction in the second holiday working visa grants, down to 34,097—red flags for any minister, surely, whether it be the Minister for Agriculture and Water Resources or the Minister for Home Affairs.

In 2016-17, the top five countries for first working holiday visa grants were: the UK, down 4.5 per cent; Germany, down 0.9 per cent; France, actually, up 5.5 per cent; South Korea, up 3.8 per cent; and Taiwan, down 3.3 per cent. In 2016-17, the top five countries for that second working holiday visa were: the UK, down 3.3 per cent; Taiwan down 0.3 per cent; South Korea, down 6.8 per cent; France, down 6.1 per cent; and Japan, down 1.9 per cent. Not a good tale at all. To apply for a working holiday visa, you must have a valid passport from a country that's involved in the working holiday program. Not every country that we have diplomatic relations with is able to access this scheme.

Much of Australia's large Taiwanese diaspora lives in my electorate of Moreton, which also has a significant Korean population. As I just mentioned, Taiwan is one of the top five sources of working holiday visas, both first and second. A few years ago, due to the stories I was hearing about the Taiwanese using this visa scheme being exploited, I travelled north to Bundaberg with Ken Lai, who was the then director general of Brisbane's Taipei Economic and Cultural Office. We also visited the Lockyer Valley and caught up with many of the backpackers working and picking on farms. We went out to the farms, mainly Bundaberg and the area's tomato farms, but also a few other crops down in the Lockyer Valley. We met the young backpackers, we went out for dinner with them and we chatted to them about the hourly rates and the potential for exploitation in this industry—particularly, when being paid piecemeal rates under the horticultural award. Sadly, the evidence I heard made me realise that there are unscrupulous operators, and that—and I'll say this to support the member for Hinkler—often it's actually a middle person rather than the grower who's actually doing the exploiting. Sometimes it is a fellow countryman of the Taiwanese and Koreans, and they take advantage of these optimistic, fun-loving, usually young backpackers.

The Fair Work Ombudsman recently released a report into the wages and conditions of people working under the working holiday visa program, and they'd received nearly 2,000 requests for assistance from visa holders in 2016 and recovered $3 million owed to these visa holders—so about $1,500 each. When this program was expanded a decade ago, it introduced an option for young visa holders to extend their stay. If they did it in regional Australia, they got an extra 88 days. That made them more open to being abused, particularly people from Asian countries like Korea and Taiwan. They didn't understand the workplace rights of Australia and so there was more likelihood that they could be duped or abused. That is not what the program was set up for. Unfortunately, it's sometimes hard to get information about workplace rights into the hands of working holiday-backpackers in their language. Sadly, sometimes they go straight from the airport, into the middleman's van and then off to the agricultural areas. It's hard to get them the information.

We know the facts. We've had review after review. We can't just hope for the best; we need to have tighter scrutiny and increased transparency. Prime Minister Abbott's 2015 budget package allowed the date of effect of an employer's registration to be made publicly available on the Australian Businesses Register so at least visa holders could check that public register to see if a business was registered. Sadly, this bill removes the requirement for the public listing of the business on the Australian Business Register, which was a bit of transparency that would help catch the rogues. As we know, you have to enforce it for the cowboys, not for those that want to do good. This bill will remove the ability of working holiday-makers to look up those details. It erodes the ability for greater protection. As I mentioned here today, it's an industry rife with significant cases of exploitation and, as such, Labor opposes this bill.

Luke Gosling (Solomon, Australian Labor Party) Share this | Link to this | Hansard source

I also rise to oppose the Treasury Laws Amendment (Working Holiday Maker Employer Register) Bill 2017. This is another episode in this government's total mismanagement of the working holiday tourism sector in Australia. Before I get into the register issue, I want to briefly take you back. Members will recall the fiasco of the backpacker tax in the 2015 budget. In that budget, the government announced that it would treat working holiday-makers, backpackers, as nonresidents for tax purposes. This meant that they would have been taxed at 32.5 per cent from the first dollar they earned. When the government said that, that message went all around the world. Damage is often done when you send out a message like that to the working holiday-makers who obviously have other options available to them. Then the government decided it would tax backpackers at 19 per cent on earnings up to $37,000 and at marginal tax rates above that. Then, in a deal to get the bill through the Senate, the government agreed that that rate would be 15 per cent. I and many of my other colleagues were trying to get it as low as possible, knowing the damage done from that initial announcement. This whole process could, in fact, be used as a case study of how not to formulate policy.

We've heard some of those opposite, such as the member for Grey, say that the working holiday-maker sector is absolutely essential, and the member for Durack said that backpackers are vital, that regional Australia can't do without them—and they're right. So why did those opposite trash the reputation of Australia as an attractive destination for backpackers? Unfortunately, the perception now is that we are a high-tax country and that other countries like Canada and New Zealand are much more attractive for backpackers. If the members opposite don't realise that that reputational damage was done then they're even more out of touch than I thought they were. I'll come back in a moment to the disastrous effects of this ill-conceived and totally mismanaged policy on our tourism industry and on our Northern Territory economy, but I'll add that I agree with the Nationals senator Barry O'Sullivan, who recently said in Darwin that the backpacker tax was one of the worst decisions made by this federal government—made by those opposite.

First, though, I will go to the specific intent of this bill. This bill is nothing more than the result of a sleazy deal with Senator Leyonhjelm to get the bill through the Senate. One of the few positive aspects of this whole policy shambles was that working holiday-makers would have been able to consult a register of employers to see if a business was registered to employ working holiday-makers. But the effect of this bill is to remove that safeguard for working holiday-makers. Many backpackers, as workers, have been exploited, underpaid, forced to live in squalid lodgings and, in some cases, sexually harassed and assaulted. We've heard from those opposite that they understand that. They agree that that has happened. They've heard the stories. This register would have at least enabled employees to look up details of an employer to be assured that they would be charged the correct level of tax. The original bill meant there was some ability to protect working holiday-makers from that type of exploitation. We oppose this bill in its current form because it removes this further level of protection for these vulnerable workers where there have been very serious cases of exploitation and ill-treatment.

In November 2016 the finance minister, Senator Cormann, defended making the register public on the grounds that it would allow working holiday-makers to identify whether a prospective employer was registered. Don't forget that; that's what Senator Cormann, part of the federal government, said. However, he has now apparently changed his opinion. He has agreed to remove the safeguard for workers in exchange for Senator Leyonhjelm's support. Senator Leyonhjelm said:

For the first time in Australia's history, it—

the register—

will authorise the Australian Taxation Office to divulge the private financial details of employers to the Fair Work Ombudsman so it can enforce government decrees on wages, including minimum wages, award wages and penalty rates.

It was reported that Senator Leyonhjelm had successfully lobbied the government to make the register private. There were also totally unsupported and scurrilous assertions that unions could misuse the bill's provisions to scare employers away from hiring foreign labour and that unions opposed to the use of foreign labour might visit registered companies to scare them off from hiring backpackers. This is just par for the course for those opposite. Union bashing seems to be the government's method of argument whenever they are unable to explain why they are abolishing good policy such as this register.

The Treasurer's second reading speech was strangely silent on this issue. He said that the bill introduced changes to ensure that details of the working holiday-maker employer register are not made public. He did not say why these changes were thought to be necessary. The fact is that removing public access to the register removes an important safeguard that ensures that working holiday-makers are not exploited. Similarly, the explanatory memorandum sheds no light on the reasons for the amendment, stating only that the bill gives effect to the government's commitments. Commitments to whom is not explained—commitments to Senator Leyonhjelm, no doubt.

So here we are at another point in the sorry saga of the backpacker tax, a totally botched policy which has damaged Australia as a backpacker destination. As we've heard from those opposite, backpackers are an important source of seasonal labour, and they've met many of these backpackers. They contribute significantly to our economy, and they bring cultural and social exchanges of benefit to our country and to their home countries. Many former backpackers now established back at home have fond memories of their time in Australia. They retain much goodwill towards Australia and sell Australia to their friends and family. But a lot of damage was done with this ill-thought-out plan, which was led by Nationals MPs. I would have thought they would have had a clearer understanding and appreciation of the importance of backpackers and working holiday-makers to their sectors and their regional communities.

Backpackers are incredibly important for the Northern Territory economy and seasonal employment requirements in agriculture, horticulture and hospitality. They also tend to stay longer than other tourists and inject a significant amount of the money they earn—in fact, much of their earnings—back into our local economies. But, as I said, many of them have stopped coming. Unfortunately, those opposite have done a very effective job in persuading them not to come here to Australia and, more specifically, to Darwin and the Top End. The perception now is that in Australia backpackers are highly taxed and countries like Canada and New Zealand are much more attractive. Added to that is the higher cost of visas for working holiday makers compared to other backpacker destinations.

In Darwin and the Top End the tourism and hospitality industry is very seasonal. The peak, the dry season, has just started; it runs from May to October. So we are now looking to tourism to take up some of the slack in the Darwin economy resulting from the winding down of the construction phase of the INPEX project. The tourism industry is becoming more and more important in the Top End. Now that the dry season is here, the industry is very stretched. There is, in fact, a labour shortage. I have been talking to tourism and hospitality industry leaders in Darwin and they tell me that backpacker numbers, working holiday maker numbers, are well down on previous years. Unfortunately, they are pessimistic about numbers as we go forward into this dry season.

At this stage, in Mitchell Street, Darwin's main tourism and backpacker precinct—and I'm sure many in the chamber have visited Mitchell Street—there are approximately 1,000 backpacker beds in the hostels. Despite there being lots of work available for backpackers in labouring and hospitality, operators are struggling to attract them to Darwin. At present, the backpacker hostels are running at about 60 per cent capacity. They should be at 85 per cent capacity now that the dry season has started. A month ago not one of these backpacker hostels had even opened, because of lack of demand. Usually, a month ago, or six weeks ago, on that shoulder season coming into the dry, they would already be at 50 per cent. So there's clearly been a direct hit to the Darwin economy. The three major hostels in Mitchell Street have projected a downturn of $1 million to $1.5 million over the coming year. That's what they had projected previously, after the backpacker tax was introduced. But in May, in the first week of the dry season, they are already down $1 million in revenue.

What is more important is that a knock-on effect goes down through the economy; the lower number of backpackers goes down through our economy. Now, $1 million in revenue may not seem like a lot to some of those opposite. In fact, for people who live in harbourside mansions, it's not even what they pay out of their own pocket to win an election. But, to us, in the Top End, in our northern capital, in our tourism industry, it's a big hit. Each backpacker bed is worth 27 bucks a night. So we're losing a lot of that revenue. In addition to that direct cost, each backpacker spends an average of $250 per week in supermarkets, retail and entertainment. They spend that 250 bucks out of their own earnings. Those earnings go straight back into the local economy. One estimate is that if, as feared, backpacker numbers are down over this coming dry season, then something like $8 million will be taken out of businesses in Mitchell Street and the Darwin CBD. Thanks a lot to those who engineered the backpacker tax and absolutely botched its implementation!

Clearly, this is going to have a big impact on our tourism economy. Tourism is vital to the Territory. That's why I'm so concerned about the ongoing impact of our attractiveness as a destination for backpackers, which would only have been enhanced by having a register where employees could check the bona fides of these employers. You may ask: 'What are you doing about it, member for Solomon?' I'll tell you what I'm doing about it. Boosting tourism in Darwin is incredibly important, particularly after the botched backpacker tax scaring tourists away. So recently, on 28 April at the Darwin International Airport, we ran a Tourism IdeasFest so that we could come up with new tourism products to try to attract some of these young people back from all around the world. I want to acknowledge all the organisers and sponsors of that event. I worked with local innovators and entrepreneurs. Local businesspeople were really worried about the impact of this drop in backpacker numbers, and we put on a one-day event at the Wirraway lounge at the airport. I thank all the sponsors and those that contributed.

Some great ideas were pitched at the end of the event, and we're going to work with those people to try to bring those working holiday-makers back. The Northern Territory government are also doing their bit. They've recently announced a $103 million tourism stimulus package to attract more visitors, to create more local jobs and to put more money into the pockets of Territorians. They're rolling that Turbocharging Tourism program out at the moment.

What I want those opposite to understand in the time remaining is that Darwin, as the capital of the north, is of strategic significance to our country. It is a strategic hub. We provide a massive return on investment to our country, and we need you to stop cutting our services. GST has been cut, hospital and school funding has been cut, and the City Deal hasn't been signed. It is not helpful, in the same way the backpacker tax changes weren't helpful. We need you to start supporting our industries, and that is one of the reasons why I oppose this bill.

Andrew Leigh (Fenner, Australian Labor Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

I would like to thank the member for Mackellar for his generosity in letting me take the jump at this moment.

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

Don't make me regret it!

Andrew Leigh (Fenner, Australian Labor Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

I'll do my best, Member for Mackellar. What is it about this government and deals around transparency laws? We saw a couple of years ago the government do a deal with the Greens political party to water down tax transparency for large private firms, raising the threshold so it took two-thirds of those private companies outside the tax transparency net. Then, in this bill, the Treasury Laws Amendment (Working Holiday Maker Employer Register) Bill 2017, we're seeing a dodgy backroom deal with Senator Leyonhjelm to remove the ability of the Commissioner of Taxation to make information concerning the registration of employers of working holiday-makers publicly available. Strangely, the explanatory memorandum to the bill states that removing transparency was a government commitment, but that's not what the public record acknowledges. Comments made to Fairfax media on 13 December 2017 paint quite a different story. Let me quote that article:

A spokesman for the Treasurer Scott Morrison said the bill was proposed by Senator Leyonhjelm.

"The government agreed to introduce the amendment after reaching an agreement with the senator to pass the original WYHM legislation. The government will honour its commitment," the spokesman said.

"This commitment did not extend to the successful passage of the amendment.

What's even more bemusing than the suggestion that the commitment didn't extend to the passing of the legislation is the following quote from the Treasurer's spokesman:

"The government is committed to protecting the rights of backpackers and protecting them from exploitation.

That strains credulity. As the Treasurer would be aware, under the Treasury Laws Amendment (Working Holiday Maker Reform) Bill 2016—the bill that passed parliament—employers of working holiday-makers were required to register with the tax office. Those employers were required to have proof and date of registration attached to their Australian Business Register records to enable backpackers to confirm both a potential employer's registration and the rate at which they could expect to be taxed. The Treasurer issued a media release stating backpackers could look up employers by ABN Lookup, making the register publicly available. Here is the full quote:

To generate more accurate data and boost integrity of the scheme by preventing exploitation of working holiday makers, their employers will be required to undertake a once-off registration with the Australian Taxation Office [ATO]. This simple and easy registration process will help provide valuable data on the employment of working holiday makers. Employers who do not register will be required to withhold tax at the 32.5 per cent rate. Working holiday makers will be made aware of registered employers via the publication of a list on the ABN Lookup.

You would look in vain for the list that was promised via that media statement. It just isn't there.

I and my Labor colleagues believe in transparency. That is evident in our approach to tax transparency in other spheres. But it is absolutely vital in this sphere, and that's because we've had a number of reports providing really concerning evidence about the exploitation of working holiday-makers. These are young people coming to Australia often for the first time. We have a societal responsibility to make sure that they're not ripped off. It's the decent thing to do, but, beyond that, the rip-offs of working holiday-makers undercut labour standards for local workers.

They create a situation in which those working holiday-makers who will go on and do terrific things in their home countries might develop a pretty sour sense of what Australia stands for. The last thing we want is for the future leaders of countries like Britain, Canada, Germany, Sweden or Korea to go back to their countries telling the story to their friends that Australia was the country where they got ripped off by a dodgy employer. Those dodgy employers are in the minority, thankfully, but we don't want working holiday-makers to be ripped off. Even worse than the wage rip-offs is the sexual exploitation which has happened in the past, of which cases have been documented.

It's particularly a concern because of the way in which we structure visas, in that obtaining that second-year visa is contingent on doing work in a rural or regional area. That means that some working holiday-makers are placed in a situation in which they're reluctant to report abuse because they know, if the employer doesn't sign off on their having worked in that area, they won't get that second-year visa. That creates a bargaining imbalance that doesn't exist for most workers. So it's just critical that we crack down on exploitation and the promised ABN Look-up was one useful way of doing that.

Because of Labor's commitment to transparency, I wrote to the Treasurer about this bill. I requested the government remove the Treasury Laws Amendment (Working Holiday Maker Employer Register) Bill 2017 from the Notice Paper. It had, after all, languished on the Notice Paper for some time. I urged the government to publicly indicate their support for transparency in the Working Holiday Maker scheme and have the Commissioner for Taxation make the information publicly available. Such a public commitment by the government would have removed uncertainty about the future status of the register bill. It would have ensured that information vital to the integrity of our tax system and, critically, that prevents the exploitation of workers was no longer available. No-one on either side of this House wants working holiday-makers to be exploited. But the government has brought on this bill for debate, and those of us on this side of the House are asking: what backroom deal does this relate to? Is this an attempt to have Senator Leyonhjelm rush through the remainder of the government's $80 billion tax cut for the top end of town? Is it an attempt to secure speedy passage of the Treasury Laws Amendment (Enterprise Tax Plan Base Rate Entities) Bill 2018—the government's patch-up job of its rushed first round of company tax cuts? We won't know because the government's reasons are as opaque as the register itself.

Unions and tax justice organisations have called for the tax commissioner to make public that register, as the Treasurer's media release signalled will be done. But this bill ties the hands of the tax commissioner. This bill means the tax commissioner isn't able to fulfil the intentions of the Treasurer as stated in that media release. It's not the first time the government has stymied the Australian Taxation Office. We know, of course, of the 4,000 jobs that have been cut. But it is something that I urge the government to rethink. No-one should support exploitation. We have a measure that can reduce exploitation by providing those working holiday-makers with the look-up of employers that they were promised. I and my Labor colleagues will do our best to work with the crossbench in defeating this bill—another part of the government's war on transparency and a measure which, if passed, would worsen the exploitation of an already vulnerable group of workers.

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

At the end of 2016, the government was faced with the prospect that working holiday-makers, better known as backpackers, were going to find other destinations more desirable than Australia because changes to our tax law meant that they would be paying significantly higher taxes here than they would in other countries. I will resist the temptation to make the point that high tax rates have adverse implications for our economy and that any party thinking of levying over $200 billion in taxes on hardworking Australians and Australian businesses would be arguing for some very adverse implications for our economy—some would even argue catastrophic implications. Indeed, I will also resist the temptation to point out that those opposite have constantly opposed reducing taxes for ordinary Australians and the Australian businesses that provide work, investment and products to those same hardworking Australians. But, a year ago we found a group of people that they thought did deserve a tax cut. It's a shame they were not Australians.

When the government suggested a 19 per cent tax rate for foreign backpackers, those opposite were outraged that it was not lower. So imagine my surprise when the member for Fenner said that backpackers can, and in fact do, reduce conditions and wages. But still he and his party argued for further reducing the tax burden on this group to 15 per cent. Perhaps he secretly knows that these claims of exploitation are exaggerated. Despite this, I was glad that this parliament could at last come together around meaningful tax cuts. It was just a shame that it was for people who do not live here. It was like opposite day: the Labor Party were arguing for tax cuts and we were arguing for responsible taxation.

The implications of the increase in taxes were well noted by many at the time. The most vocal of those were the many farmers and growers of this great country. They pointed out that backpackers were now bypassing this nation and taking their labour to other countries, such as New Zealand. They preferred to work in New Zealand rather than Australia—that's how serious things had got. It meant reduced production, fruit dying on trees, jobs left undone and farmers scaling back their operations for want of people to do the work. They were not alone. Many tourist destinations said they would be adversely impacted by backpackers not coming to Australia. Many hospitality businesses said they could no longer fill roles in their businesses. In my electorate of Mackellar, on the Northern Beaches, many of the cafes and restaurants that people who come to our area rely on were finding that they could not find people to work and, therefore, had to close, denying people the food and coffee of the fine area of the Northern Beaches. Basically, this tax increase, in an area where people could pick and choose, was reducing our capacity as a country to provide jobs, work and income for many hardworking Australians and their families. So, there we were. High taxes were causing economic damage. The Liberal Party struck a deal with the Greens—the Greens!—to reduce taxes because even the Greens could see that it was a good idea.

The Treasury Laws Amendment (Working Holiday Maker Employer Register) Bill 2017 introduces changes to ensure that details of the working holiday-maker employer register are not made public. It also ensures that information sharing between the Australian Taxation Office and the Fair Work Ombudsman is undertaken in situations in which an entity is actually or is reasonably suspected of noncompliance with tax law. Though minor amendments to taxation law, this bill removes the ability for details of employer registers to be made public on the ABN Lookup. This change will not affect the operation of the employer register or the rules applying to employers of working holiday-makers. All employers of working holiday-makers will still be required to register with the ATO in order to withhold the 15 per cent tax rate. The register addresses concerns about the exploitation of working holiday-makers and will provide valuable data on working holiday-makers. This amendment being introduced today does not affect the requirement for the ATO to report this information annually to the Treasurer for presentation to the parliament. This reporting process involves aggregate employer information and will not identify any working-holiday-maker employers. This bill also ensures that information sharing between the ATO and the Fair Work Ombudsman will be limited to situations in which an entity is guilty of, or is reasonably suspected of, noncompliance with the tax law.

But at the heart of this bill is the underlying principle that our data belongs to us. We live in a world where too many organisations, be they private companies or public entities, believe that they own our data. If we are nothing more, surely we are the sum total of what we have done, said and thought. This information can be used to carefully understand us in order to help and assist us and to ensure that we are not violating our laws and our mutual obligations to each other. Where all of this goes awry is when private companies such as Cambridge Analytica use it to manipulate us and to ensure we do things that are not in our best interests, through carefully crafted, targeted and highly curated information—information that plays to our worst fears, evokes passions and encourages us to ignore reason. This is the danger that we face in the 21st century. We do not want governments or any other entities believing that we and our information belong to them.

The importance of the measures contained in this bill is that they strike a careful balance between what government needs and what we owe—and, more importantly, what we own. Our information belongs to us. Therefore, restricting access and not allowing all the information contained in the ABN register to be publicly available is an important step in attaining this goal. To give teeth to this provision, the TAA Act creates an offence for the disclosure of protected information by taxation officers. To further tighten disclosure protocols in order to ensure that the register is used only for proper purposes, and to give effect to the principle that our information belongs to us, not to government agencies, disclosure could only occur in circumstances where the record or disclosure was of the fact of an entity's actual or reasonably suspected noncompliance with taxation law and was for the purposes of ensuring the entity's compliance with the Fair Work Act.

In summary, this bill ensures that employers are registered with the ATO so that the government can ensure the integrity of the tax system—nothing more and nothing less. It does this by implementing a registration framework for the employers of backpackers; providing the administrative arrangements for tax to be withheld at the appropriate rate for these taxpayers; requiring the Commissioner of Taxation to report annually on the operation of the tax arrangements; and allowing the commissioner to provide relevant information to the Fair Work Ombudsman. I commend this bill to the House.

Michael Sukkar (Deakin, Liberal Party, Assistant Minister to the Treasurer) Share this | Link to this | Hansard source

Firstly, can I take this opportunity to thank all members who've contributed to the debate on the Treasury Laws Amendment (Working Holiday Maker Employer Register) Bill 2017. As has been spoken about, the government recognises that working holiday-makers are an integral part of Australia's tourism industry and also a key source of labour, particularly in the agriculture, horticulture, tourism and hospitality sectors. This bill, importantly, removes the ability for details of the register of employers of working holiday-makers to be made public by the Australian Business Register via ABN Lookup. Importantly, all employers of working holiday-makers will still be required to register with the Australian Taxation Office. Registered employers will be able to withhold tax at the new working-holiday-maker rate of 15 per cent, from the first dollar of income up to $37,000. Once registered, employers can advise current and prospective working holiday-makers that they're registered and are able to withhold tax at the new working-holiday-maker rate of 15 per cent, from the first dollar of income up to $37,000, as I mentioned.

The register addresses concerns about the exploitation of working holiday-makers and will provide valuable data on who employs working holiday-makers, what sectors they are engaged in and, importantly, where they are located. This amendment does not affect the requirement for the Australian Taxation Office to report this information annually to the Treasurer, ultimately for presentation to the parliament. This reporting process involves aggregate employer information and won't identify any working holiday-maker employers.

In addition, this bill restores provisions regarding information-sharing between the ATO and the Fair Work Ombudsman to what they were prior to the changes made by the Treasury Laws Amendment (Working Holiday Maker Reform) Act 2016. Information-sharing between the ATO and the Fair Work Ombudsman will be limited to situations in which an entity is actually or reasonably suspected of noncompliance with the respective tax law.

This bill, again, is part of a broader package of reforms to ensure that Australia remains an attractive and safe destination for working holiday-makers in all of those very important sectors of our economy that I mentioned earlier. Therefore, I commend this bill to the House.

Tony Smith (Speaker) Share this | Link to this | Hansard source

The question is that this bill be now read a second time.