New Zealand’s capital markets and savings pool are substantially smaller than Australia’s; however, their corporate bond market is deeper, broader and more liquid. It is not the result of history or natural advantage. It is the result of ongoing regulatory failure and institutional obstructionism.
This report seeks to call out this neglect and obstruction, not because it benefits the financial markets or will enable a few tech billionaires to add another zero to their bank balance but because we need to do this for two people: working Australians who are approaching retirement and need to regularise their retirement incomes, and growing businesses that want to stay in Australia but have little or no access to venture capital, and like Atlassian, Afterpay and Resimed, are forced to relocate overseas, taking their investment, intellectual property, best people and income with them.
Having invested so much in their development through R&D grants, our education system and other infrastructure, we as a nation lose that investment overseas where tax gets paid in the US, Europe or not at all.
The following recommendations as a suite would act as a very powerful driver of the Australian bond market. However, each taken separately would remove barriers to the issuing of corporate bonds.
This is important given our savings, demographics and demand for venture capital.
Therefore, it is the hope of this Committee that the government will commence implementing recommendations as soon as possible even if done separately as each recommendation will result in unleashing the considerable power of the corporate bond market in Australia.