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Monday, 26 May 1997
Page: 3946

Mr ANDREN —This government claims to be the champion of small business. If so, why is a small business in my electorate facing insolvency because of the inflexibility of the Superannuation Guarantee (Administration) Act? This local business, through no fault of its own, fell behind in its superannuation contribution payments. Thinking they were doing the right thing, the firm paid the outstanding amount of $13,000 directly to a fund after the cut-off date allowed by the law. Now the Australian Taxation Office is demanding the same $13,000, plus interest, plus the guarantee charge, plus an admin charge—totalling a grand sum of $21,000.

The ATO is bound to collect this amount and, because of the voucher system used to distribute these funds, it is impossible for the super fund to credit the employer for this double payment. Furthermore, the fund cannot release the amount already paid to the ATO unless certain, and very strict, hardship criteria are met. My constituents, quite harshly, do not qualify. The result is that the firm is now being forced not only to pay the penalty in the form of charges and interest but also to effectively pay their employees' superannuation contribution twice.

This is absurd. These people are indeed caught in a catch-22 or, as they put it, `between a rock and a hard place'. Surely the intention of the law was never to punish small business to the extent where they may be forced to close up. I call on the government to amend the law so as to better reflect its intention and to ensure that Australian small businesses—like the one in my electorate of Calare—are not punished twice for the same mistake.