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Economics Legislation Committee
Department of the Treasury

Department of the Treasury


CHAIR: Welcome, Markets Group. Thank you for being so patient. Senator Ketter, do you have questions?

Senator KETTER: Yes, thank you, I have a number of questions, firstly in relation to the registry modernisation project. I want to take you back to the inquiry that we had into the bills. There were statements made during that inquiry that there was money set aside in the 2018-19 budget to write a business case. At the time, Ms Vincent made the comment that the business case would be used 'for consideration by government in relation to the 2019-20 budget'. Can you tell me what funding or staffing or plans are in this budget or the portfolio budget statements regarding this modernisation project?

Ms Vincent : The Modernising Business Registers Program and the creation of DINs remain stated government policy, and a decision on the business case will be considered in the 2019-20 MYEFO context.

Senator KETTER: So it has been pushed back to MYEFO?

Ms Vincent : It remains policy, and a decision will be made in MYEFO.

Senator KETTER: Just to be clear: there are no details in this budget? There has been no money set aside in this particular budget; is that what you're saying?

Ms Vincent : You won't find a measure in the budget.

Senator KETTER: What about each year of the forward estimates?

Ms Vincent : No. As I said, the decision in relation to the business case, which will include a decision on funding, will be made in MYEFO.

Senator KETTER: You said that it remains the policy of the government. What does it mean if there are no details in this budget, yet it remains policy and the government views the project as necessary? I'm trying to reconcile these things.

Ms Vincent : There is funding for the remainder of this existing financial year. In relation to continued work, we will continue to consult on the data standards and the disclosure frameworks, both of which were raised in the committee hearing we had in Melbourne that you referred to earlier; that is in relation to the legislation that was introduced into parliament on 13 February. We'll continue to consult on options on how people will actually get and use a director identification number. There will be some testing of how a whole-of-government IT registry platform would work, and we will continue with our review of ASIC's registry fees structure.

Senator KETTER: When will the government finish its consideration of the business case?

Ms Vincent : All I can tell you is that my understanding is that a decision on a business case will be considered in MYEFO.

Senator KETTER: Can you please tell me, Ms Vincent, why the government decided to introduce the legislation when there was no action being taken in this budget in relation to this matter?

Ms Vincent : That's not really a question that I can answer. That's a matter for government in terms of its legislative priorities.

Senator KETTER: Perhaps I should refer that to Senator Seselja.

Senator Seselja: I will have to take that question on notice, Senator Ketter.

Senator KETTER: I have another brief line of questioning in relation to the issue of choice product dashboards in superannuation. I want to ask some questions on ASIC's recent further extension on class order relief for choice superannuation product dashboards, which was granted on 8 April.

Mr Brake : Superannuation is handled by Fiscal Group, so they would need to answer those questions.

Senator KETTER: So this issue of the dashboards—your department doesn't have any oversight of this area?

Mr Brake : Not our group. The Treasury certainly does, but within Fiscal Group.

Senator KETTER: That finishes that. Thank you.

Senator WILLIAMS: Who is responsible for the user-pays, if I can call it that, for ASIC? We had a situation where ASIC was spending a lot of money on financial planners and liquidators. There's been a user-pays system brought in. Who's responsible for that?

Ms Vincent : I believe you might be referring to the industry funding model of ASIC; is that correct?

Senator WILLIAMS: Yes.

Ms Vincent : In terms of who's responsible: ASIC issues the invoices under IFM, if that's what you're referring to.

Senator WILLIAMS: Excuse my ignorance; IFM set the rate, do they?

Ms Vincent : Sorry; in relation to—

Senator WILLIAMS: Here's my problem. I have a friend who is a very honest, decent financial manager. He manages an investment fund of about $7 million. He has been hit with an ASIC fee of about $30,000 a year, which seems to be very, very expensive given that there's not a big profit in the management of the fund. I was wondering whether that could be reviewed. I think it's too expensive. I understand the user-pay system, where ASIC, I think, were spending $30 million a year on policing financial planners and collecting about $2.8 million in registration fees; and with liquidators spending about $10 million a year and collecting only about $40,000 a year in registration fees. I can understand, instead of the taxpayer funding all the monitoring and surveillance of industry, the user paying. But in this case, where someone has a small investment fund of $7 million and is billed $30,000 a year, I think it's a bit over the top. I was wondering whether there is a review system for it.

Ms Vincent : Yes, Senator. ASIC is required to publish what's called a cost recovery implementation statement, often referred to as a CRIS. Each year they're required to do that under the Australian government charging framework. The latest one came out in March. It's available on ASIC's website and it's open for comment.

Senator WILLIAMS: So I'm better off putting a question to ASIC, am I?

Ms Vincent : Yes. You, or indeed the person that you're referring to, are more than welcome to make submissions under that.

Senator WILLIAMS: All good. Thanks, Chair.

Senator KETTER: In lieu of those other questions, I will ask about the issue of the outsourcing of legislative drafting. I think that's an area for Markets Group—is that right?

Mr Brake : Those questions are probably best go to our Law Design Practice colleagues, who are part of Revenue Group.

Senator KETTER: I'll direct them in that direction. Thank you. All good, Chair.

CHAIR: No more questions. I'm very sorry to keep Markets Group waiting for so long. Thank you very much for appearing before the committee today. We'll let you go. We'll go to the Productivity Commission and then ASIC.