Marise Payne (NSW, Liberal Party, Minister for Human Services) Share this | Hansard source

I thank all members of the chamber who have contributed to the debate on the Export Finance and Insurance Corporation Amendment (Direct Lending and Other Measures) Bill 2014. This bill prioritises the needs of the engine room of our economy, small and medium-sized export businesses, or SMEs. In fact, the vast majority of Australian exporters are SMEs with sales of less than $5 million a year.

In relation to a number of the points raised in the chamber relating specifically to Efic's previous support of a number of major resources projects—that has been referred to by other speakers—I would point senators to the new statement of expectations issued by the Minister for Trade and Investment to Efic, which has ruled out future lending to onshore resource projects and related infrastructure.

These changes will enable greater lending support to small and medium-sized exporters. Efic plays an important role in supplementing the provision of credit for exporters, and it is the government's view that this bill is repositioning Efic to best support those exporters into the future. As senators would know, Efic is currently only able to provide support for the export of capital goods, which are used for the production of other goods but are not themselves the end product. According to the Australian Bureau of Statistics, however, only five per cent of Australian goods exports are capital goods. The remaining 95 per cent of goods exported from Australia are currently exempt from the direct support that Efic is able to provide. These include anticipated high-export-growth goods like pharmaceuticals or fibre, wine, food and medical products.

So, in introducing this legislation, the government has decided to enhance Efic's capacity to support SMEs by enabling it to lend for the other 95 per cent of goods export transactions. To implement this measure, this Efic amendment bill is required to remove the word 'capital' from the definition of an eligible export transaction in the EFIC Act. We are also ensuring that the changes do not bring Efic into direct competition with private sector financiers, by applying competitive neutrality principles.

I would like to take this opportunity in the chamber to thank the chair of the Senate Standing Committee on Foreign Affairs, Defence and Trade, Senator Back, and other members of the committee for the recognition that the direct lending amendment will provide a viable alternative for SMEs seeking access to finance to expand their exporting opportunities. Most importantly, the committee clearly acknowledged that the bill will assist small exporters who may be excluded by banks due to the lower dollar values of their transactions.

In conclusion, the goal of this bill is to increase Efic's capacity to finance SMEs seeking to capitalise on global trade opportunities. These global trade opportunities benefit Australia greatly and will drive job creation and higher living standards for Australians. I commend the bill to the Senate.

Question agreed to.

Bill read a second time.