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Wednesday, 9 February 2005
Page: 119

Senator MURRAY (5:13 PM) —I continue my remarks on the Superannuation Supervisory Levy Imposition Amendment Bill 2004 and related bills. On the face of them, these bills are quite clear. Under the current arrangements some small financial institutions have argued that they bear and have borne a disproportionate burden of the levies which are already in operation, but they acknowledge that the new arrangements provide greater equity. The obvious consequence of that is the reason we should support the bills, because even those who feel they are hard done by find the new levy arrangements better.

The second thing we should draw attention to is the very large number of levies and new taxes that have emerged under this government since 1996. There may well be a case for their rationalisation and for more consistent policy concerning these levies. The other point to make is that the Australian electorate have not punished the government—they have re-elected it—so obviously the levies and new taxes have not upset that many people. But I think there may be a case, as there is for any mature government—and I think we can now classify this as a mature government, in its fourth term—for looking back over what has been done and seeing if further rationalisation is possible. These bills do not do that—they merely improve an existing situation. In the end the debate should be about the level of government services and how those are funded. I suppose the number of new taxes is not the critical issue, but it is a fact that people find that the presence of multiple different kinds of fees and taxes gives them a sense of being hit upon—of governments finding every way possible to sting them. You are often better off with a few bigger taxes than a multitude of minor and irritating taxes.

Back in 2001, ASIC collected $201 million but only spent $139 million. There is an issue of whether the funds raised should equal the funds spent and not find their way into general taxation. The purpose of a levy and the taxation philosophy behind a levy is that it should meet the specific expenditure—the hypothecated expenditure, almost—that it is intended for. Very often with government levies we hear the criticism that only part of the levy is used for the purpose the levy was designed for and the rest is simply taking profit and is off to the general taxation reserve. That is not good practice.

The bills do not address the issues of whether cost recovery is appropriate in regulating the financial service sector, whether current funding arrangements produce the most efficient or effective returns or even whether the level of funding for APRA is adequate, although I must say to the government that the reforms of APRA have markedly improved its performance—something which they well know. I think its earlier performance was pretty miserable. Cost recoveries are not really an increase in taxation, and you can never quarrel too much with that. The Australian Constitution seems to require seven different bills due to the requirement for a separate bill for each particular levy and tax. It is an odd thing that we are faced with a paper nightmare when it could have been done much more easily in another way.

Those are just some rambling and reactive thoughts concerning this. I and my party are certainly not opposed to these bills, nor are we opposed to the levies and how they are being used. These bills achieve the government’s aim of implementing those recommendations made in the report on the review of financial sector levies that require a consequent legislative change. Whether the moneys in the end will do the good deed we need them to do we will only find out in the process, but I hope the government takes to heart my point that at some stage we need to review the entire philosophical basis under which we are operating at present with these multiple levies, fees and taxes.