TURNING AROUND THE TITANIC

TURNING AROUND THE TITANIC

THE COALITION’S PLAN TO SOLVE AUSTRALIA’S RED TAPE EMERGENCY

1.1 - The Regulatory Quagmire

Australians are ambitious. We want to get ahead, build things, create jobs, and leave our children a better future.

But Australia’s prosperity is now under threat. Economic growth is flatlining. Productivity is collapsing.

As an Opposition, we will be constructive where we can and critical where we must.

Under the Labor Government, hardworking Australians are facing a double whammy. They are working longer, and earning less. Australian business is sinking in a cost and regulatory quagmire, and the longstanding dream of owning a home is looking more and more out of reach.

We must face facts. Our once lucky country is now in decline. We are now paying for past but somewhat recent failures. There are many reasons for this decline, but one of the main reasons is: we have become inefficient, bureaucratic and unproductive.

Tonight, I will address the failures of Labor’s first term, the dangers of their second, and the Coalition’s plan to develop a red tape cutting agenda ahead of the next election.

Australia is experiencing negative productivity growth. That means living standards are going backwards. Over-regulation is driving a misallocation of resources and driving down productivity.

The Albanese Government has introduced 5,034 regulations in just three years.

In addition to these 5,000 new rules, 400 new laws were enacted last Parliament.

Labor reregulation has crushed entrepreneurship and innovation in our economy.

This goes beyond just embedding the Fair Work Commission and unions into business transactions, or the creation of monolithic funds like the reconstruction, housing and rewiring the nation organisations.  

Albanese’s Labor has introduced bad and retrograde laws into Australia.

Laws like the ridiculously strict country by country tax reporting rules.

This new regime goes beyond comparable jurisdictions, like the European Union. It exceeds OECD Standards, and will introduce a $30 million compliance cost.

Another example is giving the Reserve Bank two boards. Two.

Then there is the pointless legislation of defining the objective of superannuation. This law is unenforceable and totally pointless.

In fact, Labor is so focused on introducing rules and regulations - they even regulated lunch in Canberra!

If you can believe it - their new National Portrait Gallery of Australia Regulations officially restrict patrons from bringing in outside food and drinks.

Tonight, I can reveal that the cost of complying with the new laws initiated by the Albanese Government during their first term has reached $4.8 billion.

This is the total, conservative cost of the government’s own impact analysis statements from their laws as conducted by the Prime Minister’s department.

That’s $4.8 billion that could have gone into new capital equipment, more staff, better training, or investing in technology. Instead, it’s being devoured by red tape.

The National Audit Office said back in 2014, “the total annual cost of all Australian Government regulation was around $65 billion per year, or about 4.2 per cent of Australia’s gross domestic product.”

Since 2014, 1,530 laws have been passed by the Parliament.

If it was nearly 5 per cent of GDP in 2014, I am certain it is now closer to 10 per cent.

Indeed last week’s Business Council of Australia Better Regulation Report exposed the sad truth: Australia has a more than $110 billion red-tape burden.

Australia cannot afford these indulgences.

The Parliamentary Library has revealed in the past 5 years, total private sector investment totalled $1.3 trillion, whilst Government consumption was $2.7 trillion.

Put simply: the government is crowding out the private sector and suffocating the private economy.

Around 80% of employment growth in the last 2 years has been in the non-market sector, despite it accounting for around 30% of employment.

The non-market sector contains jobs that are government-funded or government-created.

The majority of new jobs under this Labor Government are subsidised by the taxpayer.

This massive expansion of the non-market sector has also damaged productivity.

Since Labor came to power, productivity is down more than 5%.

And it’s not getting better - last week the RBA downgraded its medium term productivity growth assumption from 1% to just 0.7%.

The warning lights are flashing; the big expansion of the non-market sector alongside Labor’s new regulations has cooked Australia’s productivity.

Labor now say they want the private sector to lead our nation’s economic revival, but their actions betray their words.

Australia’s competitive position

I contend that Australia’s current approach to regulation is no longer fit for purpose.

This has become a cultural problem. COVID compliance demonstrated that we are not as relaxed as we imagine ourselves to be.

As a nation, we should not be afraid of accepting manageable risks to boost our output.

As I said in my First Speech in 2019, “We support enterprise. We believe in markets. And we believe in some regulation of industry…Central planning and fixing in the age of the internet is laughable, and should remind this house of the folly of indulging trade union demands to re-regulate our economy.”

Many regulations are well intentioned. But we must now confront their cumulative effect.

If we fail to chart a new course, we will continue drifting down the world league tables.

This year, Australia has fallen five places in the IMD World Competitiveness rankings and now ranks 37th for business efficiency.

Similarly, the OECD’s Product Market Regulation indicator shows Australia features a level of regulation beyond the OECD average.

New research from the Parliamentary Library tells a story of a nation too focused on bringing in new rules, rather than stripping them away.

The total number of Acts currently in force in Australia is 1,241.

In New Zealand, it is 1,057.

In Canada, it is just 880.

Given Canada’s population is almost twice ours, why do we have 35% more laws?

We are comparatively overly codified.

Take Singapore: its entire competition law is a single, streamlined Act of fewer than 200 pages. Our corporation law runs to over 4,000 pages across multiple volumes. If Chapter 7 was its own Act, it would be the 10th longest Act of Parliament.

While Singapore’s model is principles-based and business-facing, Australia’s is now prescriptive, process-heavy and legalistic. We have five definitions of small business in federal law.

This might suit the needs of lawyers and lobbyists, but it frustrates investment, innovation and enterprise.

The problem is, we have too many rules, and they are damaging our productivity and our competitive position.

1.2 - Deregulation in the National Interest

What can be done about this wicked problem? The answer is deregulation.

Deregulation is not about removing all rules. It is about making sure the rules we have work for people, not against them.

It is about backing Australians to take risks, accept greater personal responsibility, and create a better future for their families.

Deregulation is not new. Sadly, virtually all prior attempts to reduce red tape largely failed.

Why deregulation has failed so far

Specifically, these efforts were undermined by:

1. Failure to prevent the growth in new regulation (flow)

2. The absence of a methodology to drive meaningful, sustained red tape reduction (stock)

3. A lack of focus on law enforcement of existing rules  

4. Distractions which eliminated redundant rules but did not yield material benefits

5. The failure of the Prime Minister and his department to perform its function of impact analysis

6. Canberra’s commitment to vested interests where maintaining a suite of regulation suits a particular industry incumbent or organisation such as the trade unions

7. And an increasing reliance on delegated authority which is lazy, cheap and undemocratic

The default response of the government to a problem is always to add more regulation, even if it is duplicative or similar to an existing statute or rule.

More rules is always seen as good. The Minister can announce the problem is solved. The caravan moves on. The dog barks.

There is limited interest in how the new rules are enforced - unless there is a scandal.

Some efforts to reduce red tape have been cruelled by a widely held perception that one man’s red tape is another man’s consumer protection.

This is a very damaging proposition because it assumes that every single rule in the book must be retained to save someone from something.

But that’s not true, because in many cases, the law enforcement doesn’t exist, so the country pays twice.

We pay for the red tape burden cost, and we pay for the cost of no enforcement. In Australia, many existing laws are simply ignored.

For example, we now have a compensation scheme of last resort when we really just need the slew of corporate and financial laws to be enforced.

A Senate Inquiry documented the failures of ASIC, but we still have no response from the government after over 13 months.

They are supposed to respond in three months.

Now we have the First Guardian, Shield and Lion financial collapses and Australians rightly asking why the rules weren't enforced to protect their investments

Labor hasn’t even bothered to issue ASIC with a statement of expectations. The last one was issued by Treasurer Frydenberg in 2018.

In 2023, the Australian Law Reform Commission recommended a massive consolidation of corporations and financial services laws. They found one bank spent $1 billion on compliance in our world-beating corporations law.

The ALRC report has also been ignored by Labor.

Australia has a serious law enforcement problem.

* You can walk over the Harbour Bridge calling for the death of Jews - no law enforcement

* You can steal people’s money and send it to the Cayman islands - no law enforcement

* You can breach copyright laws and take people’s creative works for AI - no law enforcement

So a new approach—a new Australian approach to reboot enterprise—is needed. We can only do that if we have a genuine debate about the role of regulation and its limits.

We need a new methodology to permanently reduce red tape.

It will be much more than having a repeal day or two.

Failure of the central agency

The federal office dedicated to analysing regulation is the Office of Impact Analysis. The OIA is the latest version of the original Business Regulation Review Unit established in 1985.

This was later renamed the Office of Best Practice Regulation. This unit sits inside the PMC.

In 2014, the Abbott Government decided all Federal Government decisions on regulatory matters which are more than minor in nature would require a RIS - or Regulation Impact Statement.

These RIS’ include a cost estimation number, showing whether government decisions reduce or increase compliance costs.

On 18 November 2022, the Albanese Government renamed the OBPR the Office of Impact Analysis, and RIS’ were renamed as Impact Analysis.

Why Labor decided to take the word “regulation” out of the office determined to create better regulation is a mystery.

Nevertheless, the OIA is meant to be the guardrail preventing unnecessary compliance costs slowing down business.

I can reveal that under this government, the OIA has seen its headcount fall from 21 people to 16 in just 3 years.

The OIA failed to stop any of the 400 new bills in the Labor’s first term: a 100 per cent strike rate so far.

The Productivity Commission is scathing in its latest report on the OIA under Labor. Labor gutted the Office for Impact Analysis as it re-regulated the economy.

This is a failure of the Prime Minister. It is his department.

The PC recommends strengthening the independence of the body. The OIA is a neutered dog under Labor.  

Rent seekers’ paradise

Another reason we can’t deregulate is because regulation suits rent seekers.

One of the biggest problems of the last three years with Australia’s economic policy, is that it has been squarely focused on vested interests, not the national interest.

Labor has shoveled money and policy out the door to the people who ran and supported their campaign for office.

One example is the abolition of the Building and Construction Commission. This has been very bad for housing.

In 2022, Ernst & Young modelled abolishing the ABCC. They said:

“There could be a cumulative $47.5 billion fall in GDP by 2030 if the ABCC was abolished, with a significant reduction in construction industry output...”

Similarly, rules underpinning the Federal Safety Commission seem more about trade unions clipping the ticket than they do about worker safety.

The community benefit principles behind the Future Made in Australia policy locks Australia into the subsidisation of industry, precisely what the Productivity Commission warned against.

Coincidentally, it also locks in payments to unions.

The latest example is the one already assured outcome from tomorrow’s Productivity Roundtable: Labor has now pushed ASIC to help the super funds to buy up domestic housing - this is not the Australian Dream.

It also diverts ASIC’s resources from law enforcement, but in Labor’s world of rent seeking, who cares?

Former Macquarie banker Ivan Power has described this rent seekers’ paradise as “Australian anemia”.

Australia maintains rules that suit vested interests. But what we really need are rules which reward enterprise and individuals.

Over zealous delegation

One reason the Albanese Government has introduced 5,034 new regulations in just one term is because they have inherited and created for themselves an incredible level of delegated authority.

Generally speaking, this means that Ministers make disallowable regulations, or they issue an instrument which is not reviewable or disallowable by Parliament.

In this way, the Minister makes the law.

The Government is now breaching the boundaries of what is reasonable to delegate, and on many occasions, they have sought virtually unlimited delegated authority to make material judgements in regulation.

This is not within the spirit of delegated legislation.

There are two such examples where this is happening now.

Firstly, on the unrealised gains tax, the Treasurer will arm himself with the ability to set the pension tax arrangements for the Prime Minister after the bill passes the Senate. This is an unmanageable conflict of interest. He will set the tax rules for his boss.

Surely, all the relevant details for parliamentary defined benefits schemes should be in the bill given this howling conflict of interest.

Secondly, the government wants to materially change the Commonwealth’s mortgage insurance policy, The Home Guarantee Scheme. Labor wants to uncap the scheme and remove any income restriction, thereby allowing anyone to access the programme.

In other words, they will nationalise the lenders mortgage insurance scheme for first home buyers. This is a material change.

This can be done by regulation and without the regulation being subject to disallowance.

Accordingly, I sought assurance from the Minister that there would be proper industry consultation. But, the consultation was secretive, and lasted barely more than a fortnight.

A whole industry may be wiped out, which includes not just insurers, but also FinTechs and innovative companies which are solving the problem of no or low deposits.

But the delegations are so deep that none of this matters in Australia today.

These ‘skeleton’ or Henry VIII laws are a complete perversion of the democratic process. The Australian Law Reform Commission and the Senate Committee on Delegated Legislation have both issued warnings, and they are right.

Over delegation is one element of the Australian regulatory illness, as it's all too easy to make more rules.

Global perspective

As we look to reboot Australian enterprise, we can look to the United Kingdom, the United States, and even the European Union.

In January 2025, UK Prime Minister Starmer said: “Deregulation is now essential for realising Labour ambitions.”

He has now committed his government to cut compliance costs for businesses by 25 per cent.

The United States has its own programme of deregulation.

And even the red tape obsessed European Union has taken up the deregulation agenda, through a report from Mario Draghi to simplify reporting obligations and cut duplication.

Your move, Australia.

2.1 - Labor’s Failure

Australian Labor seems to have discovered the impact of the regulatory burden only after winning this year’s election.

Tomorrow’s roundtable was a surprising announcement, especially considering their first term was dedicated to increasing red tape.

Moreover, at the National Press Club in June, The Treasurer revealed he would write to the regulators across government, seeking quote, “specific, measurable actions to reduce compliance costs without compromising standards.”

It hasn’t worked.

Small businesses continue describing regulators acting as if they are, “on steroids” and that small business owners feel, “like we’ve got our backs against the wall” when dealing with regulators.

We welcome Labor’s sudden devotion to cutting red tape as well as their productivity roundtable—but the proof will be in their actions, not their words.

It will be akin to turning around the Titanic.

Housing

The irony of Labor’s red-tape obsession is that it has undermined its ability to drive its own policies.

Nowhere is this failure more apparent than in housing.

It seems Treasurer Jim Chalmers and Housing Minister Clare O’Neil have read the book Abundance. It is incredible that they have had to consult a book written by Americans in America to finally discover their policy disasters.

Surely they already knew there was one credible way to deal with the housing crisis: more supply.

It is clear that after three years, Labor has failed to deliver more housing supply.

Under The Coalition, Australia was building almost 200,000 homes a year. Under Labor, this has plunged to barely 170,000.

Labor has failed to pressure the States. They have allowed the States to indulge in NIMBYism.

NIMBYism is a cancer. It is un-Australian and totally unacceptable.

Federal Labor has failed to use its massive platform for YIMBY advocacy.

Failure on supply is now hurting the economy and the society itself.

As Australians, we have achieved so much in these last 250 years, and I am so proud to be an Australian.

The first land grants were issued by Arthur Phillip in 1792. By the end of the Menzies era, home ownership peaked at 70 per cent. This was a supreme democratic achievement of Australian Liberalism.

Today, that achievement is being undermined by the national failure on housing.

That is why we need stronger federal measures if we are to return the dream of home ownership to younger generations. This must be a supply-side endeavour, as most demand-side measures only make the problem worse.

Labor went to the election promising to build 1.2 million new homes by 2030. They call it their National Housing Accord.

The truth is - they won’t even build a million new homes. No State or Territory is projected to meet its share.

Last term, we discovered Labor’s signature housing policy, the $10 billion Housing Australia Future Fund, built zero new houses. Instead, this money was spent acquiring existing homes, thus making Australia’s housing crisis worse.

Today, Labor is doubling down on their big government approach.

They will expand the Home Guarantee Scheme so it is not means tested and totally uncapped.

And, they will spend $10 billion to build 100,000 new homes.

Labor plans to become both a government property developer and a government mortgage insurer.

Instead of examining the bottlenecks constraining private builders, Labor is usurping them.

In June this year, Clare O’Neil announced, “The Commonwealth is back in the hard work of financing and partnering to build new housing.”

The Commonwealth should not be building houses. It should be asking what regulations are causing builders, plumbers and other trade contractors to go out of business. This includes measures Labor introduced in their first term which have only added to the regulatory burden.

I have met with stakeholders in the housing and construction sector that describe insane conditions that Labor has helped introduce.

Rules like no concrete pours after 10am, limits on the hours of work allowed each day, and stop-work triggers for inclement weather.

Needless to say, all these things do is raise the cost of construction and further price people out of the market.

For the construction industry, suppliers are locked out of big projects if they do not pay into specified union-linked redundancy funds.

Looking at one of these funds, Protect, its board is not too dissimilar to the board of a Big Super fund, with five of the seven directors being from either the Electrical Trades Union or the National Electrical and Communications Association.

In 2024, Protect gave $7.5 million to unions masked as "disbursements" and "sponsorship fees".

We have seen this film before - this is what happens when you put vested interests first.

Labor cannot have it both ways. They cannot claim to be supporting the construction of houses when their freshly inked regulations only make building harder, slower and more expensive.

3.1 - Our Alternative

Labor wants big government and big vested interests. The Coalition wants big opportunity.

We are the party of enterprise. We are the party of small, medium, and large business. We believe in Australia and its people.

As Robert Menzies put it in 1944: “governments do not provide enterprise; they provide controls.”

Our method

Accordingly, our deregulation policy will reflect this timeless position - we will promote genuine enterprise with limited, rather than repressive controls.

That’s why Sussan Ley has created my portfolio of productivity and deregulation. This is now a priority for the entire Coalition team, through a whole of government approach.

Under Sussan Ley, The Coalition will reconnect with business.

As part of our deregulation agenda, we are in the process of identifying priority areas that will make the most significant impact on the Australian economy.

Over the last few months, I have been engaging with industry to identify these areas and my door remains wide open.

Each proposal to cut red tape must be accompanied by a rigorous costing as we seek to relieve the red tape burden from Australia’s economy.

Identifying all priority areas will take time, but some are already clear.

While all our housing policies are up for review, it’s clear red tape is a huge problem.

There may be room to go further than our prior policy to freeze the National Construction Code.

If there is a lever to make building houses easier, we will look at it.

In financial services, we need to ensure that sound financial advice is available.

But overly-prescriptive education requirements have seen the number of financial advisers shrink from a peak of 28,000 in 2018 to around 15,600 today.

Whatsmore, mining, resources and energy are the lifeblood of the Australian economy.

It stands to reason then, governments should be working hand in hand with these industries to boost our international competitiveness, not smothering them with red and green tape.

Multi-employer bargaining, forced bargaining and union entry expansion rights are all examples of Labor’s new rules which damage productivity.

Self regulation

Allowing industries to raise consumer standards without government hand-holding is a good thing.

Australia has a long history of allowing particular sectors to implement their own rules and codes. The first such example predates Federation, with the establishment of the New South Wales Medical board in 1838.

Frankly, in many cases industry and professional bodies have a better understanding of the guardrails needed in their sectors than us politicians.

There is also a budgetary advantage to self-regulation - industry bears the cost of their own regulation, not the taxpayer.

Effective self-regulation exists in many areas today.

For example, the Australian Banking Association’s Banking Code of Practice sets enforceable standards for how banks deal with customers, covering areas such as hardship support and dispute resolution.

I have personal experience with the development of the Life Insurance Code of Conduct which has transformed the transparency and reporting now available to policy holders.

For example, retail death claim timeframes have made a 63% improvement from 3.5 months to 1.3 months. This was all achieved without legislation.

Over the coming three years, I will be actively looking for opportunities for industry to self regulate. This isn’t always possible or desirable, but it should absolutely be considered.

I am the first Minister or Shadow Minister to have the word “Deregulation” in my title for over a decade. It is a long time coming for Australia to re-focus on this area.

Together with my colleagues, we are committed to cutting red tape to boost enterprise, investment and jobs.

This is the beginning.

Thank you.

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