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Monday, 26 November 2012
Page: 13341

Mr CIOBO (Moncrieff) (18:07): I rise to speak to the Treasury Legislation Amendment (Unclaimed Money and Other Measures) Bill 2012. This is an extraordinary bill. The reason it is an extraordinary bill is that, in essence, this is a fig leaf to cover the Treasurer's rather unfortunate situation—that is, this is a government that, as we know, inherited a budget surplus in excess of $20 billion and over $70 billion in net savings, and as a consequence, largely, not exclusively, of very poor policy decisions, has now squandered all of those assets and savings that the previous, coalition government put in place and has racked up over $140 billion of net public debt. That is a consequence of this Labor government's typical ineptitude when it comes to economic stewardship, this government's inability to balance a budget, reduce debt and decrease spending and this government spending like there is no tomorrow. In the face of continued economic circumstances being unfavourable globally, we have a government that, also as a consequence of their policy decisions, are now facing a situation where they are looking straight down the barrel of running another huge budget deficit.

The last four budget deficits have been the biggest deficits in Australia's history. The government would say, 'The reason these deficits have been so big is that we have had to stimulate the Australian economy,' notwithstanding that we are above average trend when it comes to the level of economic growth and notwithstanding that we are in the part of the globe which has enjoyed the strongest continued and sustained period of economic growth. Instead, we have a government that has been out there promising so many things to so many different people in an attempt to counter its very poor stewardship. That is why we have seen, for example, announcements with respect to the NDIS, announcements with respect to Gonski and an announcement with respect to health funding.

Because the government is staring down the barrel of another massive budget deficit, this government is desperately doing whatever it can to claw back revenue. So we get to today's bill, the Treasury Legislation Amendment (Unclaimed Money and Other Measures) Bill. To those that are no doubt going to be reading and enjoying the Hansard on this debate, as they thumb their way through the pages of the Hansard, wondering what Wayne Swan, the member for Lilley, was thinking with this bill, let me make it crystal clear. I certainly know that constituents in my electorate, on the Gold Coast, are very concerned about the approach that has been adopted by someone who, in my view, is a Treasurer with a serious amount of ineptness but who, for some unknown reason, others seem to herald as the world's greatest treasurer.

This particular bill has a number of schedules to it, but in particular I would like to focus on the first schedule. The first schedule to this bill amends legislation with respect to so-called unclaimed bank accounts. It reduces unclaimed bank accounts from a period of inactivity of seven years down to a period of inactivity of three years. The consequence of this is this: money that is deposited into a bank account which has no activity on it for a period—under this bill now—of three years will be taken by the government and placed in the consolidated revenue. It is only through a high level of proactive effort from the person who has lost that money to consolidated revenue that they would be eligible to get that money back. I would also add an important qualifier—for them to get that money back in terms of the original principal plus CPI.

Now contrast that with the fact that currently the existing threshold for account inactivity is seven years. So the Labor government is moving it from seven years of inactivity to three years of inactivity, and the consequence is that there is a bottom line boost to the budget of some $660 million, basically half—in fact more than half—of the forecast budget surplus. So Wayne Swan has this fig leaf that he dangles about, because he knows that there is, in fact, an embarrassing budget deficit there. The member for Lilley, the Treasurer, is amending the legislation to raise an extra $660 million.

The point as well is that it does not allow for changes in circumstances. Say, for example—and this is one of the proposals that the coalition is putting forward—someone had two or three bank accounts. They may, in fact, have an offset account. People would be familiar with the concept of an offset account. It is an opportunity to park some cash to offset your home loan borrowings. People will often leave money in those accounts because they want to redraw that money down so they get the benefit of offsetting the interest payable on their mortgage account but by the same token they are not obligated to leaving that money sitting on the mortgage account and can withdraw it from that account at any particular time. It almost beggars belief that the government is so desperate for cash that it would look at capturing money in offset accounts as part of its attempt to raise $660 million of additional revenue, even though other accounts that are attached to the offset account are active. That is why the coalition has very reasonably said that the legislation should be amended. It should not be rushed in this way. Australians should not have their money that they have worked for taken by a Labor government that is obsessed with getting as much cash as it possibly can in as quick a time period as it possibly can because the member for Lilley, the Treasurer, is so desperate to prop up a budget that is eroding. We see this situation arise where the government is turning its back on the coalition's amendment even though it makes perfect sense. Amend the legislation so that individual accounts are not looked at but rather individuals are looked at. If an individual has three or four accounts, they should be looked at in toto, not individually. As I said, an offset account is simply the clearest example that one could come up with.

Another example of just how desperate this government is is in the MYEFO, the Mid-Year Economic and Fiscal Outlook. This government, in MYEFO, raced through this change in an attempt to prop up its budget bottom line. This was a point made clear by the Australian Bankers' Association in their submission to the Joint Standing Committee on Corporations where they said:

… the proposed timing for implementation and a commencement of 31 December 2012 is unrealistic, being in less than two months and falling during a period when banks implement freezes on any technology or IT systems changes. It is estimated that banks and other ADIs will require at least six months to make all the necessary changes, inform customers in a legally compliant manner and meet compliance requirements.

That is what the ABA says. The situation is extraordinary. The government is ignoring the advice of the ABA, saying to banks, 'No, you must be compliant within two months.' Why? Because it is good public policy? No, not because it has anything to do with good public policy. This is done for one reason and one reason alone: a desperate government that is trying to grab as much cash as it can as quickly as it can because it does not want to go into an election year facing yet another massive budget deficit. That is the reason why we see the Treasurer stand up and make claims: 'We've got an aim; we've got a plan; we've got a vibe; we've got an inkling; we've got a general plan to have a desire to reach a budget surplus at some point.' What the government does not have is the discipline and the wherewithal to effectively steward the Australian economy in a way that delivers a budget surplus. The problem is compounded when you see days like today, when the Minister for Health heralds the fact that the government is spending an additional $4 billion in the health sector. The government talks and crows about its vision when it comes to the NDIS—as we saw from the minister for FaHCSIA today during question time—and the government continues to spend obscene amounts of money on the NBN.

The consequence of all of these factors is that this government now has liabilities forecast to be around $120 billion to the year 2020, all of which are unfunded. A further $120 billion of unfunded announcements by this Labor government builds on the already $145 billion of net public debt—which saw the erosion of $70 billion of net savings which the former coalition government left to it—so that, in total, this glorious Labor Party that Australia has had to shoulder for the last five years has managed to spend roughly $350 billion more than this government has. That is the legacy of the Australian Labor Party. This bill is nothing but a prop to try to pretend that this is a government that in some way knows what it is doing. The greatest travesty—the most shameful aspect of this government's spending spree and this government's inability to control its promises and its spending—is that it is tomorrow's generations, the Aussie kids of today, who are going to have to pay off the $350 billion that this government has spent, money that it simply does not have.

Consistent with past form of a government that is so desperate to make announcements to try to buy its way back into office at the next election, we have a government that makes the announcements without the funding, and now we have a government that is prepared to take people's money away from them with only two months notice because it desperately needs to raise $660 million as part of its attempt to deliver a so-called surplus of a billion dollars. In addition to that, in schedule 2 of the bill the government is amending from seven years down to three years the inactivity test for the first home saver accounts—again, another four-year reduction which unreasonably increases the risks of unintended consequences. Again, the Australian Bankers Association at the brief hearing of the Senate Standing Committee on Economics stated:

… customers generally find these accounts—

that is, first home saver accounts—

and the restrictions and conditions confusing. Applying the unclaimed money provisions would add additional complexity, especially given the 4 year qualifying rule. Similarly to fixed products—

such as term facilities and deposits—

we consider that any new unclaimed monies provisions should only apply to at-call account types which satisfy the definition for inactivity.

So again there is the extraordinary circumstance where the government, so keen to get their hands on the cash, are willing to throw away good public policy.

Schedule 3 amends from seven years to three years the inactivity test for matured insurance policies. Schedule 4—and this is perhaps the most galling part of the amendment to the bill—also amends the Superannuation (Unclaimed Money and Lost Members) Act 1999 to change the circumstances in which lost and unidentifiable superannuation accounts must be transferred to the government. Now a lost member, for the purposes of this bill, as defined under the superannuation industry's supervision regulations, includes, for example—and I am quoting one of the provisions—'the member is uncontactable'. That is, the provider has never had an address for the member, or two written communications to the member—or one written communication if the trustee so chooses—has been returned to the provider unclaimed. In other words, for those millions of Australians who do not take an active interest in their superannuation, who may have received a letter and had it returned, or who may not have received a single letter, their money can now be transferred to the government as being unclaimed. Again, it is a disgrace when it comes to good public policy, and it is done for one reason only: to prop up this government's budget bottom line.

On every level the government should accept the coalition's amendments and, if it fails to accept the amendments that we have put forward—sound, good policy based amendments—then this bill ought to be rejected. In essence, this bill does nothing except try to prop up a government that has shamefully wasted $350 billion and has put the next generation of Aussie kids in debt. Rather than introducing bills like this, it should focus on governing for the betterment of Australia.