Standing up for Canberra

Business Names Registration I Bill 2011

As a former small business owner I am absolutely delighted today to be able to support the Business Names Registration Bill 2011 and the other associated bills. Over a century ago the colonies that made up this country agreed to join in one federation. There were many reasons for this, but chief amongst them was the need to streamline and make commerce easier between the states and to ensure that businesses from one state were not unduly prevented from trading in another state. It is for this reason that I continue to be amazed that after over a century of Federation we are yet to achieve one national economy and that businesses are discouraged from engaging in trade between the states. In so many ways we continue to operate eight different economies with their own rules and regulations. They are often more at odds with one another than in cohesion with one another.

As the Minister for Infrastructure and Transport noted in the Canberra Times earlier this year, it is 110 years since Federation and Australia is now one of the most prosperous and stable nations on earth, yet if we look at the statute books of the states and territories on some issues it is as if federation is as elusive as it was for Henry Parkes. In his speech to the Committee for Economic Development earlier this year that commemorated their 50th birthday, the minister also spoke about the work he is doing trying to harmonise and streamline infrastructure in this country. It is a massive reform program, and he spoke then about the draft national freight strategy that had been out for consultation and also the progress that had been made in the creation of a single national regulator in maritime, heavy vehicle and rail safety.

What struck me in this speech was the fact that he mentioned that there were currently governance arrangements set by 23 regulators with inconsistencies across state borders that create confusion, excessive red tape and productivity losses. The thing that struck me most was the example of the hay bale. He also mentioned in question time just recently the issues that hay bale producers in the country's south-east have to endure because of the quirkiness and the legacies of pre-Federation arrangements. Trucks in Victoria are allowed to carry more bales across their width than they can in New South Wales. How that continues to exist after all this time I do not know. It is 110 years on and we have still got differences in hay bale weights that we can carry across borders. It is absolutely extraordinary.

The reform that we are talking about today, like so many of the reforms that Labor is introducing, is very welcome and very overdue. In a globalised world, with access to modern communications and transportation technologies, the notion that businesses should forsake the opportunity of engaging in business across state lines due to the prohibitive costs of business registration names is truly bizarre. I cannot possibly see why the states and territories would maintain their own different business registration practices. I have been there myself—in the ACT I registered and paid I think $130. I got the registration for five years and I think it is $70 in another state and you get it for three years. It is completely ludicrous, and small businesses do not want a wall full of business registration names just to make them feel important. It is all just work that we do not need to do.

We need to operate as one national economy. I think this issue is a very clear-cut case of the need for the Commonwealth to take some power from the states in order to advance the national interest. If we are to be committed to the free market as a basic driver of economic life and growth, as this government is, then it is a duty incumbent on us to examine critically the obstacles to the operation of a free market that may have arisen historically. Hay bales are one example; business registration names are another. Part of the unfinished business of Federation is the removal of obstacles that make life harder for businesses. It is also our duty to make it less difficult for businesses to enter into commercial life and, most importantly, expand, prosper and become more productive.

As I mentioned, as a former owner of a small business and a sole trader, I know full well that it is hard enough to operate your business and maintain your records without the need to engage in repetitive and redundant regulatory requirements. I believe this represents the very worst of red tape. This is the kind of issue that strikes a chord with me as I believe these regulatory requirements represent the everyday obstacles at a micro-level to the smooth operation of the market. We are talking at the microlevel here, but it is just another barrier to being productive, getting out there and being successful in business—making money and employing people.

This reform, like many other regulatory reforms of this government, represents the hard slog of a good economic reform agenda. It may not be the large-scale reforms that catch our attention but it is nonetheless an essential building block. Therefore, this bill represents a small but important piece of the great mosaic of economic reform in which this government is engaged.

At present, a business operating in every state and territory faces a cost of more than $1,000 to register a business name for three years. This is simply the cost of registering and it does not represent the opportunity costs associated with getting across the various regulatory practices and forms associated with eight different sets of regulation. There are opportunity costs because people quite often forget that, when you are running around town signing up for business registration names, paying your $130 and getting your little business thing framed, time is money in business. Time spent not marketing yourself, not doing administration and not doing your core business—the business that you were set up to do—is wasted time. As I mentioned before, it is unproductive time. It does not enhance in any way the success of the business. It is just dead time, and it impacts on the nation's productivity.

This is a massive cost and represents a deterrent to businesses that may wish to expand to other states. If you have to fly down to Melbourne or send down to Melbourne, pay your money and go in and fill out the form there, it is just a complete nonsense. It is a deterrent to expansion, a drag on productivity, a drag on the future growth of business and a drag on the prosperity of the economy.

This kind of regulatory burden is one of the reasons that it has long been part of this government's reform agenda to take a look at the regulations that exist and, where necessary and appropriate, reduce or eliminate them. A big part of this reform agenda has been to work with the states and territories on realising the idea of Federation and to have one national economy. This cooperative approach, led by COAG, will drive this economy forward into the future and ensure Australian businesses can maximise their commercial opportunities, increase their productivity and not be weighed down by redundant and repetitive regulatory frameworks.

The legislation before us today is another part of this cooperative reform agenda. It was agreed by COAG in July 2008 that all states and territories and the Commonwealth would work towards one national scheme for the registration of business names. Finally, we have got it. In July 2009, COAG signed an intergovernmental agreement, and the states agreed to refer their powers on business names registration to the Commonwealth. This legislation is the culmination of that agreement and will develop a seamless national business name registration system that will include online registration for business names and Australian business numbers, to be operated by the Australian Securities and Investments Commission.

This change will mean that, instead of the thousands of dollars currently charged to business for operating nationwide, they will now be required to pay just one fee, in the order of $70, for a three-year registration of their name. It is a significant saving, both in the direct cost of registration and in the time and opportunity costs required by the current fragmented state based system. As I mentioned, time is money in business, and running around doing this sort of thing is dead time. This change is not only going to make it easier for businesses but it will make it easier for consumers to quickly and accurately identify the entity behind the business name. It is proposed that, with continued cooperation, this new system will be in place by May next year.

This kind of legislation may not appear on its surface to be of great importance to the affairs of the nation, but for a small business owner it is very important. Certainly it does not attract the media or the public spotlight, but I can assure this House that it is very important for that great engine of the economy that is small businesses and microbusinesses. By ensuring that these everyday mundane tasks are made easier and cheaper, we can ensure that business is not held back by the burden of unnecessary regulatory duplication and can maximise its outputs, improve its productivity and improve the economy as a result.

I strongly support the measures in this legislation and encourage the government to continue its great reforms in making sure that the vision of one national economic framework dreamt about so long ago at Federation is finally made possible.

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