Jane Hume (Victoria, Liberal Party, Assistant Minister for Superannuation, Financial Services and Financial Technology) Share this | Hansard source

Firstly, I would like to thank those senators who have contributed to this debate. Schedule 1 of the Treasury Laws Amendment (Registries Modernisation and Other Measures) Bill 2019 will provide the legislative flexibility for the government to modernise Australia's business registers onto a single platform to be administered by the Australian Business Register, within the Australian Taxation Office. Modernising the business registers will address registry fragmentation, improve business user experience, reduce risks of ongoing operating, foster data-driven innovation and enable better use of registry data.

The IT infrastructure underpinning Australia's business registry services has been found wanting and needs to be upgraded to meet current and future demands. To facilitate the implementation of a new registry system, a legislative package has been drafted that is flexible, technology-neutral and governance-neutral. The Modernising Business Registers legislative regime will allow a registrar, a Commonwealth body appointed by the minister, to create data standards and disclose frameworks to assist them in carrying out the registry functions and powers. The data standards will allow the registrar the flexibility to determine what information will be collected, how the information will be collected and the manner in which the information will be maintained. This flexible approach will ensure that the registrar can utilise the latest technology and practices.

Director identification numbers are being progressed as part of the Modernising Business Registers program. Schedule 2 of the Treasury Laws Amendment (Registries Modernisation and Other Measures) Bill 2019 provides for the introduction of a legal framework for director identification numbers which will require all directors, and alternate directors, of registered bodies to have a unique identifier. Administrative details, such as how to apply for a director identification number, will be determined by the registrar, or the registrars, appointed by the minister in due course. Importantly, once a director has been issued with a director identification number, that unique number will remain with them forever, meaning their directorships across companies and over time can be easily tracked. This will assist regulators and external administrators to investigate a director's involvement in what may be unlawful activity, including illegal phoenix activity, which has been a perennial problem for successive governments.

Director IDs are being progressed as part of the Modernising Business Registers program for two key reasons: First, doing so ensures that the director ID is integrated with other important registry data. This will provide greater insights to regulators, to businesses and to individuals on the identity and affiliations of directors. Having all business registry data linked will help with risk profiling and to combat illegal phoenixing. Second, ASIC's registers are ageing and outdated. Adding large amounts of functionality to registers that will soon be replaced will be very costly, likely increase the instability of ASIC's systems and also offer limited anti-illegal-phoenixing benefits. Moreover, ASIC does not have an identity verification progress. Progressing director IDs as part of the Modernising Business Registers program will also allow Director IDs to use the most advanced identity verification processes.

The Modernising Business Registers program will be delivered iteratively over a number of years. However, director IDs will be one of the earliest deliverables on the new, modernised platform. The government will closely monitor the effectiveness and progress of the entire program on an ongoing basis. I commend this bill to the Senate.

Question agreed to.

Bills read a second time.