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

I move:

That this bill be now read a second time.

I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows—

PERSONAL PROPERTY SECURITIES AMENDMENT (DEREGULATORY MEASURES) BILL 2014

The Personal Property Securities Act 2009 established the Personal Property Securities Register and introduced a single national system for the creation, registration, priority and enforcement of security interests in personal property.

The PPS regime superseded 23 previously existing state, territory and Commonwealth registers and over 70 pieces of supporting legislation.

This involved the migration of 4.7 million registrations to the new, national Personal Property Securities Register.

The PPS regime was an innovative microeconomic reform on a significant scale. It has fundamentally altered the way in which businesses and especially small businesses are able to borrow and it provides greater confidence to lenders in the security of their lending arrangements.

However, reform on this scale is not without its challenges.

As with all reforms of this scale, on-going assessment of implementation and adjustment where necessary is important to ensure that the PPS system meet the needs of all Australian business.

One such adjustment proposed by this Bill is an amendment to simplify the rules on when a lease will be deemed to be a security interest for the purpose of the PPS Act.

One of the goals of the PPS Act was to provide certainty about the creation of security interests. In support of this, the Act deemed certain arrangements to be security interests for the purpose of the Act. This includes the lease of goods where the lease term is for more than 12 months or an indefinite term, and the lease of serial numbered goods (for example, motor vehicles) for 90 days or more.

Since the commencement of the Act, it has become clear that the two deeming provisions can be a source of confusion and additional cost to business, as the lease of serial numbered goods can give rise to the need to make multiple registrations on the Register in relation to the same lease.

This Bill will repeal the provision deeming leases of serial numbered goods of 90 days or more to be security interests for the purposes of the Act. While this is only a small adjustment to the Act, it is expected to reduce the number of registrations that may need to be made and save business over $11 million per annum, most of which will be to the benefit of small businesses.

The Personal Property Securities Amendment (Deregulatory Measures) Bill 2014 will provide relief to the hire industry sector which provides essential support to the building and construction sectors and is primarily comprised of small businesses.

The regulatory burden imposed on the sector, by the Act in its current form, is more than is necessary for the achievement of effective and certain secured lending against personal property in Australia and this burden should be lifted.

Debate adjourned.