Ben Small (WA, Liberal Party) Share this | Hansard source

The government do not support Senator O'Neill's bill, the Franchising Laws Amendment (Fairness in Franchising) Bill 2020, not because we are deaf to the plight of small businesses in Australia, not because we haven't heard the very clear message from listening to franchisees across Australia, but because this bill seeks to make a political pre-selection stunt out of what the government consider very real issues. I look forward to explaining in detail why the Morrison government's proposed legislation will go much further to meaningfully addressing franchises in Australia and the very real impact that it has on small business in this country.

The government has already taken strong action to introduce additional protections and greater transparency in the franchising sector in Australia. Our reforms will cover a much broader range of issues, in a more fundamental and carefully considered way, than those put forward by Senator O'Neill. I look forward to the support of Senator Whish-Wilson and the crossbench when we actually address the concerns of those Australians.

The broad range of problems identified in the Fairness in franchising report are real. Seeking to implement the very limited number of Senator O'Neill's proposals now would be a piecemeal approach and detract from the timely consideration and the carefully considered implementation of a full range of reforms that are clearly required in this sector. Replicating the multiparty mediation provisions in the government's response to the Fairness in franchising report is not where we need to be.

The Morrison government has already proposed these reforms on multiparty dispute resolution, and they go significantly further than the reforms contemplated in Senator O'Neill's bill. Where appropriate, multiparty dispute resolution will be compulsory for franchisors. Under Senator O'Neill's proposed bill, franchisors would still need to agree to engage in multiparty dispute resolution. The government's approach instead will allow franchisees to share the costs of dispute resolution, promoting access to justice for those who need it and addressing the clear power imbalance in some cases between franchisors and franchisees. The Morrison government is clearly on the side of small-business people in this case.

Senator O'Neill's bill calls for optional binding alternative dispute resolution. However, we have already committed to introducing voluntary binding arbitration into the franchising code. That has simply been cut and pasted into Senator O'Neill's bill. The Morrison government will go further than that bill, by recognising that conciliation is an important form of dispute resolution that should be available to franchisors and franchisees. The government is committed to this franchising dispute resolution assistance also via the Australian Small Business and Family Enterprise Ombudsman's office, recognising the importance of the role that the ombudsman has to play in the franchising sector.

The Morrison government's reforms will also see franchisors subject to increased civil penalties of up to $10 million for engaging in misleading, deceptive or unconscionable conduct under the Australian Consumer Law and up to 600 penalty units, which would currently equate to $133,200, per offence for all other offences under the strengthened franchise code. The government is committed to this significant, 100 per cent increase—that is, a doubling—of the penalties for breaches of the franchise code. As the enforcement agency for the franchising code, the ACCC has the power to seek penalties for breaches of Australian Consumer Law. That again equates to $10 million, three times the value of the benefit received or 10 per cent of the enterprise's annual turnover in the preceding 12 months where the court cannot clearly determine the benefit from the offence. So it is the Morrison government that is on the side of franchisees in Australia, implementing a stronger framework that adequately addresses the root causes of issues that franchisees face.

On 20 August, as my colleague Senator Brockman has clearly outlined, we announced that the Morrison government was committed to introducing stronger protections and greater transparency for the franchising sector in order to restore confidence and enable this important part of the Australian economy to go from strength to strength. Our reforms, as I've clearly stated, go much further, covering a broader range of issues and addressing the systemic problems that the Fairness in franchising report has articulated. It is the Morrison government that can be trusted to implement a stronger framework to deliver improved franchisor standards of conduct and stay on the side of Australian small business. The government is committed to a timely implementation of these measures, thereby restoring confidence in the franchising sector. This comprehensively addresses a broad range of problems identified in the Fairness in franchising report and doesn't seek simply to make a political point out of the limited number of points that Senator O'Neill's bill has raised.

I guess we can point to this because we haven't seen a spread on the back of the Fin Review today and we haven't been in here articulating promises that don't adequately address the issues that are faced every day by Australians out in the economy in this important sector. By increasing the penalties, by addressing systemic concerns and by furthering the Morrison government's clear commitment to Australian small business, we are on the side of Australian franchisees and have listened to their concerns carefully. Our track record clearly speaks to this, with the coalition government delivering a series of very important policy reforms since 2013 that saw more than 1.5 million jobs created before the onset of the COVID-19 pandemic. We're in a better, stronger and more resilient position than many countries around the world because we listen to business. We get business and we respond to the concerns of business in Australia.

The assistance that we provided through the COVID-19 pandemic has built upon this substantial track record of putting in place actual policies that mean something to Australian small business. So, far from grandstanding on this important issue and far from turning our backs on the needs of Australian small businesses, we are here with a meaningful, carefully considered and comprehensive range of reforms that are far-reaching, that will be meaningful and that actually deliver benefit to those Australians who we clearly heard, through the Fairness in franchising report, needed our assistance.

It was Labor that voted against tax relief for small and medium business 15 times in the last parliament. It was the Labor Party that went to the last election with $387 billion in additional taxes.

An honourable senator: How much?

It was $387 billion in additional taxes, and now, to make a political point out of this, Senator O'Neill would seek to disrupt, undermine and dissuade people from supporting this very important process. The Morrison government will address this. We've been clear about the way in which it will benefit Australians, and we look forward to support from the crossbench when we seek to do so.