PARLIAMENT HOUSE, CANBERRA
THURSDAY, 24 OCTOBER 2019
SUBJECTS: Government illegal phoenixing inaction; ASIC resourcing; John Setka.
STEPHEN JONES: Today with realised that the Government's got absolutely no plan to deal with the horrendous problems of illegal phoenixing in this country. Every year about five billion dollars is lost from the economy through companies deliberately driving themselves to the wall, directors stripping assets, leaving creditors and workers out of pocket. Every time one of these phoenixing operations occurs around about 44 businesses are left being owed money and around about three billion dollars a year in invoices unpaid for small businesses. The Government was supposed to deal with this this week but they’ve pulled the legislation. Clearly they've got no plan to deal with illegal phoenixing. We're calling on the Government to urgently introduce the Bill to deal with illegal phoenixing and take this issue seriously. We've got less than two weeks of parliament left in this year. If we don't act on it this year, there'll be thousands and thousands of small businesses who are going to be left out of pocket because they haven't got a plan to do with phoenixing in this country.
JOURNALIST: What are you going to do about it, are you going to talk about it in Question Time today?
JONES: We’ve been raising the issue this week. We'll be taking the issue up in Parliament today. The concern is if the Government doesn't act this year we are are going to have thousands and thousands of small businesses left out of pocket over the Christmas period. We’re going to have up to three billion dollars worth of invoices unpaid for yet another year. This is supposed to be a Government priority. In Senate Estimates last night they said their preferred agenda was to introduce director identification numbers, yet their draft legislation doesn't do that. They’ve pulled it off the agenda this week, which means there's very little chance of it getting dealt with this year.
JOURNALIST: Can you explain what the directors identification number is and how it will work?
JONES: The Government itself acknowledges that the only way we're going to get serious on phoenixing is if we chase the directors. The dodgy directors who are doing the wrong thing, time after time, sending their company to the wall and then starting up under a new name, or a slightly different name, and transferring assets from one company to the other. The only way we're going to crack down on this is that we give every director a director ID number in the same way as every taxpayer has a tax file number. That way when they go to register a new company they'll be identified as a dodgy director and we will be able to stop them registering a new company as a vehicle to send their creditors broke once again and ensuring the we are dealing with the problem of Phoenix in this country by going after the dodging directs.
JOURNALIST: It is in the case of ASIC not actually having enough resources to chase up directors who might be running companies under 10 million dollars? ASIC don’t seem to have the resources to cover a small business guy, with small company, I've had personal experience with this, they just don’t want to know about it. Isn't this a case of them are actually doing their job?
JONES: ASIC know and have a plan about how to deal with this. The Government just won’t fund it. In Senate Estimates last night Senator Jane Hume said that it was still the Government's priority, still the Government's preferred way of dealing with it is to introduce director ID numbers. They have no plan to deal with this, despite themselves admitting that this the only way effectively go after these dodgy directors.
JONES: The Labor Party is doing the right thing by small businesses in this country. We've prepared amendments which reflect the Government's own policy. We were willing to work with the Government to have them introducing today, moved through Parliament before the end of the year so they could be law. By pulling the Bill of the agenda today the Government has left very little chance for this issue to be dealt with before the end of the year.
JONES: Let's be very clear, John Setka was the problem here. His values and his behaviour are completely incompatible with the values and behaviour of the Labor Party. I know plenty of fine officials within the CFMEU whose number one objective is ensuring that if their members go down a mine they come out alive. That if they’re working for a company that they get paid in the building and construction sector, that their members are going to work in dangerous occupations, come home safe. We can separate the behaviour and the operations of John Setka from the rest of the fine officials within the CFMEU who are trying to do the right thing by the members.
JOURNALIST: Do you think the Nationals plan to boost 1.2 billion dollars for the drought is a good idea?
JONES: I think we have got to get money out into these struggling regions. What is quite clear is the Government has failed to-date in dealing with the consequences of the drought. I am concerned the National Party seem more concerned about their own political livelihoods than the livelihoods of the people that they represent. We've been saying for some time now that the Government needs to have comprehensive drought strategy. One minute they say they got a strategy, the next minute they say they don’t. Can we stop the bickering inside the Government Party room? Can we just get money flowing out to these rural communities? After all it's about the farmers, it is about the workers in these communities, not the National Party's backsides.