2.1
This chapter outlines the key issues considered by the Senate Economics Legislation Committee (the committee) at its 2021–22 Additional estimates hearings with the following portfolios:
Industry, Science, Energy and Resources; and
Infrastructure, Transport, Regional Development and Communications.
Treasury Portfolio, 16 and 17 February 2022
Department of the Treasury
Corporate Group, Macroeconomic Group
2.2
The Secretary of the Department of the Treasury, Dr Steven Kennedy PSM, made an opening statement, highlighting the resilience the Australian people have shown throughout the COVID-19 pandemic, including the uncertainty faced by business with restrictions, labour shortages, and resource supply shortages. Dr Kennedy also focused on the wind down of
COVID-19 social support measures and return of normalcy to macroeconomic policies.
2.3
Topics examined by the committee included:
Tapering of fiscal support post initial pandemic lockdowns, monetary policy, and interest rates (pp. 7–8)
Impacts of forthcoming federal election on policy and spending (p. 8)
Inflation and wage and price increases, and employment and international comparisons (pp. 8–9)
Economic resilience during the earlier stages of pandemic (pp. 10–13)
Economic inequality (pp. 13–16)
Productivity enhancement, labour force and skills formation (pp. 16–18)
Labour market and wages trends in relation to women, low-skilled workers, essential workers and temporary migrants (pp. 18–21)
Energy pricing (pp. 21–22)
Fuel prices, income tax cuts (pp. 23–24)
National COVID transition plan:
Rapid Antigen Test (RAT) testing policy, implications in the workforce and schools and comparison with United Kingdom (UK) and the northern hemisphere in general
Economic impacts of the pandemic
Economic recovery campaign advertising expenditure, budget advertising campaign (pp. 24–36)
Foreign ownership and acquisition of water and land (pp. 36–38)
Sources of inbound foreign investment – Chinese investment, transport, and infrastructure (pp. 38–39)
Fiscal Group
2.4
Topics examined by the committee included:
School funding for private and public schools (pp. 39–40)
Structure of Job keeper payments (pp. 39–41)
2022 Federal Budget timing (p. 41)
Economic recovery plan – fiscal strategy, economic growth (pp. 41–44)
ACT housing loan from the Commonwealth Gov – repayment details, waiver of debt (pp. 44–46)
Job Maker program (pp. 46–47)
Small business support package (NSW Gov proposal) (pp. 47–49)
Revenue Group; Australian Taxation Office (ATO); Australian Charities and Not-for-profits Commission (ACNC)
2.5
The topics examined by the committee included:
Gender analysis of the tax system – methodology of data analysis
(pp. 49–53)
ATO anti-avoidance work (pp. 53–54, 70–71)
Investment engagement service – engagement with revenue authority
(pp. 54–55)
Patent box policy (p. 55)
Taxpayer determinations and audits (pp. 55–56)
Tax transparency data (pp. 56–57)
Pandemic measures and support for small businesses (pp. 57–58)
Pandemic strategies & comparison with overseas jurisdictions (pp. 58–59)
ATO staffing statistics in Tasmania (pp. 59–60)
Tax outcomes for women (pp. 60–61)
Review of unpaid Superannuation – communication avenues with employers regarding compliance obligations & employees (pp. 61–64)
Advocacy and campaigning on behalf of charities (pp. 64–68)
Pillar Two Model Rules and Australia’s progress in implementing a global minimum tax rate (pp. 68–70)
Markets Group
2.6
Topics examined by the committee included:
Consultation paper on proxy advice (pp. 72, 79–80)
Treasury Laws Amendment (Cyclone and Flood Damage Reinsurance Pool) Bill 2022 (pp. 72–73, 82)
Data on uninsured home-owners in Northern Queensland (pp. 73–79)
Stamp duty levels imposed by state run Labor Government N.QLD (p. 79)
Australian Securities and Investments Commission (ASIC) shown final regulations prior to tabling (pp. 79–80)
Proxy advisors—Rio Tinto (p. 80)
Jobkeeper issues—Ownership matters (pp. 80–81)
Small and Medium-sized Enterprises (SME) Loan Recovery Scheme
(pp. 82–84)
Australian Small Business and Family Enterprise Ombudsman (ASBFEO) enforcement of late payments mechanisms between large and small companies (pp. 84–86)
Superannuation changes passed in legislation (pp. 86–88)
Reserve Bank of Australia (RBA)
2.7
Topics examined by the committee included:
Gold reserves in Bank of England (pp. 88–89)
Allegations of fake bars and fake serial numbers (pp. 89–90)
Digital currency platform (p. 90)
Cash conversion into digital dollars framework (pp. 90–91)
Digital/crypto currency being backed by gold asset (pp. 91–92)
Inflation contributors in market (pp. 92–94)
Negative gearing and capital gains tax (p. 94)
RBA power to direct limit of powers in bonds (pp. 94–95)
Inflation and the Consumer Price Index (CPI) (p. 96)
Australian Prudential Regulation Authority (APRA)
2.8
The Chair of APRA, Mr Wayne Byres, made an opening statement, stating that with a stable financial system and an improving economic outlook, APRA have been able to successfully pursue their long-term prudential agenda. This included areas such as the introduction of cross-industry prudential standards; capital adequacy regime implementation; and publication of macroprudential framework papers.
2.9
Topics examined by the committee included:
Disengagement with Your Super Your Future (YSYF) initiative and super companies (pp. 97–98)
Underperforming funds and research undertaken for stapling of super funds (pp. 98–101, 103–104)
Question SBT137 response by department—Cabinet in confidence research data
(pp. 101–103)
Retail advice channel decline in business concerns (pp. 104–106)
Sole purpose test review after YSYF release Review (pp. 106–107)
Individual Disability Income Insurance (IDII) Market (p. 107)
Choice heat map (pp. 107–109)
Ethical benchmark v. investment benchmark testing (pp. 109–110)
APRA’s roadmap to invest in capital cities v. rural (pp. 110–111)
National Housing Finance and Investment Corporation (NHFIC)
2.10
Topics examined by the committee included:
NHFIC’s assistance to increase housing supply (pp. 111–113)
Eagle Farm press conference first-home buyers guarantee (p. 113)
First home buyers' loan deposit scheme and guarantee scheme (pp. 113–114)
Family home guarantee scheme (p. 114)
Prime Minister's press gallery speech to ensure affordable housing (p. 115)
Liability cap lifting NFHIC seeking clarity on further increases (p. 115)
Actual loan commitments to community housing providers
Actual approved applications v. waiting for approval (pp. 115–116)
Updated figure on website details re: how many homes supported by NHFIC (p. 116)
Concessional loan access $600million from $1billion asset fund equity investment
(pp. 116–117)
Treasury Portfolio, 17 February 2022
Australian Securities and Investments Commission (ASIC)
2.11
The Chair of ASIC, Mr Joe Longo reviewed a number of areas that ASIC have focused on including enforcement; regulatory efficiency; environmental, social and governance (ESG) factors; crypto and cyber-resilience; helping industry meet new requirements; Sterling; and the 2022 outlook.
2.12
Topics examined by the committee included:
Execution of search warrants, evidence, s.19 examinations and various actions taken (pp. 3–5)
Update on Nuix investigation (pp. 5–6)
Continuous disclosure and class actions (pp. 6–8)
Product design and distribution obligations (p. 8)
Financial services and credit panel (pp. 8–10)
Unfair allocation of costs to financial advisors (industry funding model)
(p. 10)
Alleged insider trading from superfund trustees (p. 11)
Short selling information sheets (pp. 11–12)
Australian Competition and Consumer Commission (ACCC) with the Australian Energy Regulator (AER)
2.13
The Chair, Professor Rod Sims AO made comments regarding this hearing being his last and thanked the committee. The committee conveyed its deep appreciation to Professor Sims for his service.
2.14
Topics examined by the committee included:
Mandatory notification process when merging/acquisitions
(pp. 13–14, 15–16)
Marketing scams (pp. 14–15)
Prosecution failure reflections cartel lawyers (pp. 16–18)
Uncompetitive market concentration;
Removal of the effect test (pp. 19–20)
National Broadband Network (NBN) Co stakeholders and future regulatory framework (p. 21)
NBN Cost recovery strategy (pp. 21–22)
Milk pricing increases (p. 22)
RAT test investigations (pp. 22–23)
Global gas inflation concerns (pp. 23–25)
Australian Bureau of Statistics (ABS)
2.15
Topics examined by the committee included:
Sexuality and gender identity left out of census (pp. 25–26)
Move to online census completion (pp. 26–27)
New data set introductions and removal outdated data sets (p. 27)
Single touch payroll data (p. 27)
Digital revolution creating data revolution (p. 27)
Internet connectivity data removed (p. 27)
Pandemic statistics - Divisional mortality list—coroner certified deaths
(pp. 28–31, 32)
Measurement of Consumer Price Index (CPI) in regional Australia (p. 31)
Industry Portfolio, 17 February 2022
Department of Industry, Science, Energy and Resources
Cross-portfolio/ corporate
2.16
The Secretary of the Department of Industry, Science, Energy and Resources, Mr David Fredericks PSM, did not make any opening remarks.
2.17
Topics examined by the committee included:
RAT testing supplies, importation of tests and manufacturing possibilities in Australia (pp. 35–38)
Sale of Australian made RAT testing overseas—Therapeutic Goods Administration (TGA) manufacturing approval in Australia (pp. 38–40)
Fuel and energy prices (p. 41)
Research and development grants (pp. 41–43)
Moderna manufacturing facility in Australia—procurement process undertaken (pp. 43–48)
DISER contract and consultancy expenditure—labour hire and recruitment of permanent staff (pp. 48–51)
Outcome 1 Program 1.1: Investing in science, technology, and commercialisation
2.18
Topics examined by the committee included:
Female founders’ program—application process & grant guidelines, eligibility criteria (pp. 51–56)
Payment times—manufacturing (pp. 56–57)
COVID-19 Co-ordination Commission—supply chain vulnerabilities
(pp. 57–59)
Outcome 1 Program 1.2: Growing innovative and competitive businesses, industries, and regions; Australian Space Agency (ASA); Australian Building Codes Board (ABCB)
2.19
Topics examined by the committee included:
Australian Space Agency—funding (p. 59)
Boarder closures – policy and impacts on industry (pp. 59–61)
Regional insurance premiums (pp. 61–62)
Workforce policy – recruitment, regional employment diversity and expansion of remote working possibilities (pp. 62–67)
Modern manufacturing strategy expenditure (pp. 67–77)
ABCB compliance issues (pp. 78–82)
Commonwealth Scientific and Industrial Research Organisation (CSIRO)
2.20
The CSIRO Chair, Dr Larry Marshall, made an opening statement, highlighting the success CSIRO have had in supporting Australia to drive a sustainable, innovative environment through turning Australian science into solutions that benefit all Australians.
2.21
Topics examined by the committee included:
Genetically modified Cotton (pp. 82–83)
Groundwater research conflict of interest with corporate funding
(pp. 83–84)
Climate models used to determine Net Zero targets (pp. 84–85)
Projects undertaken during COVID and reporting outcomes (pp. 85–86)
University collaboration (pp. 86–87)
Future Science Platform (p. 87)
NetZero Climate Policy (pp. 87–88)
Prime Minister's view on climate change (pp. 88–89)
Office of the Chief Scientist (OCS)
2.22
Topics examined by the committee included:
mRNA Manufacturing (pp. 89–90)
Science-based manufacturing in Australia (pp. 90–91)
Outcome 1 Program 1.3: Supporting a strong resource sector; National Offshore Petroleum Titles Administrator (NOPTA); Northern Endeavour Temporary Operations (NETO)
2.23
Topics examined by the committee included:
Energy prices (pp. 91–92)
Chinese Economy Stimulus forecasts (p. 92)
Coal price forecasting (pp. 92–93)
Iron Ore pricing volatility (p. 93)
Beetaloo Basin Program (pp. 93–95)
Russia v. Ukraine conflict causing rise in fuel prices (pp. 95–96)
Australian Domestic Gas Supply Mechanism (ADGSM)—process to examine future suppliers (pp. 96–97)
Petroleum Exploration Permit (PEP11) applications (pp. 97–99)
Extractive industries transparency initiative (pp. 99–100)
Critical minerals facilitation office (pp. 100–102)
Commercial tender applications Northern Endeavour decommissioning (pp. 102–103)
National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA)
2.24
Topics examined by the committee included:
Scarborough Pluto Gas Project (pp. 103–105)
Northern Endeavour floating production storage and offtake (FPSO)
(pp. 105–107)
Sexual harassment and assault complaints offshore (pp. 107–108)
Bullying complaints offshore (pp. 108–109)
Infrastructure Portfolio, 17 February 2022
Department of Infrastructure, Transport, Regional Development and Communications
Outcome 3 Program 3.1: Regional development (Northern Australia only); Northern Australia Infrastructure Facility (NAIF); Office of Northern Australia (ONA)
2.25
Topics examined by the committee included:
Northern Australia development program (pp. 110–111)
Business and community growth program (pp. 111–113)
Perdaman chemical processing plant in Karratha (pp. 113–115)
Indigenous engagement strategy (pp. 115–116)
NAIF funding drawdown (pp. 116–117)
Recruitment of new CEO for NAIF (pp. 118–120)
NAIF management staff location
NAIF vacancy of positions
Staff leaving levels and reasons why (pp. 120–121)
Senator Paul Scarr
Chair
Liberal Senator for Queensland