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Opinion: Billion Dollar Deregulation Target Now In Reach

With the Senate passing the Future of Financial Advice (FoFA) reforms as well as the Carbon Tax in the last week of the Winter session, the government banked nearly $300 million of annual red tape reductions.

After the success of the Federal Parliament’s first ever repeal day in March, when more than 10,000 pieces of redundant regulation and legislation were repealed and over $700 million in compliance savings announced, the momentum has continued.

In recent months, a number of significant initiatives have been taken by the Abbott Government to cut red tape for small business including franchisees, large manufacturers, job service providers and medical practitioners.

Cumulatively these reforms will result in industry and the not-for-profit sector enjoying further savings of close to $150 million annually.

For example, the Small Business Minister Bruce Billson has announced the removal of the obligation for 32,500 small businesses to lodge a BAS statement where there is no GST payable.

For another 340,000 small businesses who are currently required to submit a BAS statement but have minimal income, from now on they will be exempted from the PAYG administrative requirements. This is a great relief to many in the small business sector, particularly those who are just starting to grow.

In another development, small businesses who contract with government and who have not been paid within 30 days will automatically receive interest on their invoices without having to separately apply for it.

Franchisees also stand to benefit under new arrangements which will streamline disclosure requirements by removing duplication as well as an enhanced franchise code that provides a more equitable outcome between them and their franchisors.

In the jobs services space, independent providers will no longer have to collect information about a person’s earnings and employment hours as this data can already be accessed through the department’s own information systems. It is just common sense.

Larger manufacturers will also have their compliance burden reduced with the Government no longer mandating costly reporting requirements relating to energy efficiency. Following reforms introduced during the Howard Government business have now successfully incorporated energy saving practices as a core part of their operations and should no longer be required to spend, in some cases, more than $500,000 per annum on the administrative cost of preparing reports. This is a point which has been repeatedly made by leading industry groups, including Manufacturing Australia and the Business Council of Australia.

In tackling red tape it is important to understand that even what may seem to be the smallest and most trivial red tape impost can have a major impact on stakeholders. For example, in the May Budget, changes were announced that will see doctors working in hospitals no longer being required to write additional prescriptions for drugs they have already listed on a patient’s medication chart. This will streamline the process for more than 6 million prescriptions each year saving a huge amount of paperwork and benefiting the economy to the tune of tens-of-millions of dollars on an annual basis.

As we prepare for the second parliamentary repeal day now confirmed for October 29, Tony Abbott and his Ministers are busy identifying a series of new deregulation reforms.

Some of these initiatives will be the outcome of detailed policy reviews which have been recently concluded. Coastal shipping, the corporations law, heavy vehicle transportation and the 457 visa system to name but a few.

Others will be the result of a comprehensive audit being undertaken within each federal department of all regulations and associated compliance costs that fall within the remit of that particular portfolio.

The work of these audits, the first of their kind, are informing the deliberation of Ministerial Advisory Committees that are comprised of industry leaders and experts and whose task it is to identify reform priorities for the relevant minister.

Our campaign against red tape has also been informed by extensive public consultation including via our website cuttingredtape.gov.au which was launched by the Prime Minister and I earlier this year. Since then it has had an over 33,000 hits reflecting the degree of community interest in this issue.

The deregulation agenda, which was kicked off with the first repeal day in March, has continued to gain momentum ever since.

It requires a whole-of-government approach, tackling red and green tape no matter how big or small.

The goal is long term cultural change, from the bureaucracy to the ministry and to the betterment of the community.

At the start of its term in office the Abbott Government set itself a $1 billion annual red tape reduction target.

This target is now well in sight and we are confident it will soon be reached.

Authored by Josh Frydenberg, Parliamentary Secretary to the Prime Minister with responsibility for deregulation. This opinion piece was published today in The Australian Newspaper