Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Hansard source

As I started to say earlier in the second reading debate, the key purpose of the amendments circulated in my name is to remove the set of provisions in schedule 4 of the bill before the Senate. The government's bill would see a new section 35 inserted into the Financial Management and Account­ability Act 1997. This is outlined in item 10, while item 13 is directly related to item 10. It is the coalition's view that item 10 is vaguely drafted and lacks definition and clarity in relation to the powers it would afford to the finance minister. I detailed some of our concerns in my second reading contribution, which, of course, has been incorporated—so the Senate might have to consult the written version of that contribution.

The exceptions outlined in subsection 2, in our view, provide insufficient comfort that this authority may not be abused by the Commonwealth. It has the potential to be used to shift the power balance too far in the government's favour in its financial dealings with a person. Subsection 3 states that an amount owing by or to the Commonwealth 'includes an amount that is owing but not yet due for payment'. This means that action could be taken to set off a debt that is not even due to be repaid. If this were imposed, it could have a detrimental impact on the financial affairs of a person who is subject to a set-off action. This could create cash flow problems or worse and override a person's right to hold off on payment until money is actually due. The government has been unable, in our view, to satisfactorily explain how this power will be applied. There is clearly scope to use this authority as a means to bypass potential legal processes associated with a dispute. This could deny a person natural justice or, in other circumstances, deny others the right of a proper negotiation. It would disadvantage those without the resources to fully challenge the Common­wealth, which would be, of course, most taxpayers. It would allow the minister to call in a debt at his or her discretion and offset against another payment which might be due from the Commonwealth. There is insufficient definition about how a legitimate dispute would be defined. It seems it would be a subjective decision for the minister. For example, the minister could decide that there is no legitimate dispute even if there is one based on objective consideration. There is an attempt to define exceptions in relation to inalienable and absolutely inalienable payments—for example, advance welfare payments and paid parental leave payments—but there is not clarity or protection over potentially a number of other payments which the Commonwealth makes. Stakeholders have raised examples of salaries, allowances, grants, payments due to small business and so on.

We have formed the considered view that this section of the bill is unnecessary, it could lend itself to both abuse and unintended consequences, and therefore it should be removed. There is scope for the government to think through this provision more carefully and re-present it in a more lucid form in a future financial framework amendment bill with proper and clearly defined safeguards. We urge the Senate—particularly the Greens—to very carefully consider the implications of what the government is proposing to do in its Financial Framework Legislation Amendment Bill in relation to these matters and to consider the implications of significantly increased government power at the expense of the person. Some of the persons who have financial dealings with the Commonwealth can be the most vulnerable members of our community. To give the government the sort of power that is put forward in this bill is, we believe, excessive.

I would be interested to hear the government's response to the very genuinely held concerns of the coalition in relation to the matters I have raised, and then I might have some further questions. The opposition oppose item 10 and 13 in the following terms:

(1) Schedule 4, item 10, page 11 (line 11) to page 12 (line 10).

(2) Schedule 4, item 13, page 12 (lines 23 to 28).