STEPHEN JONES:
Good morning, everyone. This morning I’m releasing the final report of the independent review into the previous government’s Modern Business Register program. It’s not pretty reading. The language is polite but you can’t escape the underlying conclusion that this is a program that was ill‑conceived, poorly executed. It lacked governance, it lacked scope and the net result of this is that the taxpayers of Australia have lost millions and millions of dollars.
In 2019, the Morrison government promised to deliver a modernised registry program, which would consolidate 32 of the Commonwealth government’s business registers. They told us it would take four years complete, at a cost of $480 million. Well, this review makes it quite clear that it will take about a decade with a cost in the order of $2.8 billion. That’s a cost blowout five times what the previous government promised. No responsible government could allow this program to continue. We’re burning $12 million a month and that has to stop. $12 million a month with no net improvement to the services that are going to be available to Australian businesses and the users of the business registry until at least 2027 to 2029. This is a 10-year blowout on what the previous government promised and five times what they promised. It’s a story of incompetence and it’s a story of dishonesty.
When we came into government, we were told that there were significant problems with the program and that there were going to be significant cost blowouts. More money was going to be needed. We provided them with an additional $80 million. That’s in addition to the $480 million that the previous government had allocated to them and told the Australian people that was all that was going to be necessary. We provided them with an additional $80 million to get through the next 12 months. We told them they had to come back with firm costings and firm guidelines for when the project could be delivered. Month after month after month went on and the costs got bigger and bigger and bigger.
I appointed an independent reviewer at the beginning of this year. A notable former senior public servant, Damon Rees, who was responsible for the successful rollout of IT and services in the former New South Wales Government has conducted an extensive review. Thousands of pages of material, dozens and dozens and dozens of interviews – a damning conclusion about this program and lessons to government about what we should do in the rollout of future programs.
So today I’m announcing the closure of the Modern Business Registry program. We will transfer those functions back to ASIC. We’ll do the important and necessary work over the next few months to work out what needs to be done to deliver a scaled-back modernisation program. We want to ensure that the registry program is fit for purpose but we also want to ensure that the taxpayers of Australia and, ultimately, the users of these services aren’t saddled with unsustainable bills, a debt of over $2.8 billion, for a program that can’t be certain it will deliver on its promises.
Happy to take questions.
JOURNALIST:
Mr Jones, what blame should be placed on the consultants involved in this program essentially with the ATO and Deloitte over at ASIC?
JONES:
Ultimately, the blame lies with the previous government who commissioned this program and promised to the Australian people that they could deliver it for $480 million by the middle of next year. Poor governance. They simply didn’t understand what they were doing. Incompetent governance, incompetent project conception, all lies at the feet of the previous government. They knew before we went to the last election that this program was in deep trouble but they kept it from the Australian people. So, the real blame lies with Scott Morrison, the former members of the Expenditure Review Committee, who ticked off on this program and didn’t ask the right questions. If there are questions to be asked of the contractors that are involved in this scheme, then we need to look at that as well but ultimately the responsibility lies with the government who commissioned this failed program.
JOURNALIST:
Minister, six Teal MPs today have called on the government to launch a wide-ranging review of Australia’s tax system that canvass raising and broadening the GST. What’s your response to those calls?
JONES:
Look, the government has made it quite clear that our priorities for this term are multinational tax avoidance, compliance and ensuring that under the existing law, all dollars that are owed are actually paid. In the area of GST as your paper and others have reported over recent months, there is significant problems with fraud and evasion. So, we want to ensure that under the existing GST laws, the existing company tax laws, the existing income tax laws, that they’re working effectively and efficiently and the money that is currently owed under the current system is paid. We’re a government that will do what we said we’re going to do and that includes delivering on those promises.
JOURNALIST:
Minister, your government handed down the Intergenerational Report last week that forecast 40 years of deficits. You’ve got business groups and most of the crossbench now calling for a conversation on the GST. Why just immediately rule out raising it [indistinct] asked about?
JONES:
Can I say a couple of things about this? This government is the first government in well over a decade that has delivered a budget surplus. We’re very proud of that. It hasn’t happened by accident. It’s happened because of discipline. It’s happened because we are putting in place modest but important tax reforms that will deliver additional revenue over the forward estimates and into the medium term.
The Intergenerational Report has to be a North Star for governments present and future. It tells a story, or one story, of what will happen and gives an indication to governments over the next 40 years about what we need to do both in the area of revenue but also in the areas of program design and expenditure. We are a government that will do what we said we’re going to do and that means our focus at the moment is on reforms to multinational tax, to compliance with the systems, tobacco excise and the promises that we’ve already made.
JOURNALIST:
Another of your focuses is sorting out the cost‑of‑living crisis. The Senate Committee on the Cost of Living is holding a hearing today in Melbourne. Qantas CEO Alan Joyce is appearing for the first time in about a decade on the back of announcing a huge profit for the airline last week, much of that built on sky-high airfares. Do you think he has questions to answer?
JONES:
Look, I’ve been a frustrated Qantas customer from time to time whether it’s baggage services not working as they should, whether it’s flights being cancelled or delayed or whether it’s booking flights that got cancelled during COVID and having credits that are unable to be redeemed. So, I share a lot of the frustrations of Australian people. We want to see our national airline acting and delivering on services as a national airline should.
On the broader issue of cost of living, the government knows that households are doing it tough and we want to be straight-up and honest with them. We want to make sure that whatever we do doesn’t make a bad situation worse, which is why our cost restraint and our spending restraint have been so important. Yes, it is delivering a surplus, but at the same time, a government with a hard head can have a big heart and it’s why we’re delivering cheaper medicines, it’s why we’re delivering cheaper child care, it’s why we’re providing an uplift in assistance with people on unemployment benefits and pensions and rental assistance relief. These are targeted expenditures that we’re making which will make life a little bit easier for people who are doing it toughest. And it’s also why our energy bill relief is so critical as we get our energy generation distribution system onto a more sustainable future.
We’re not going to be a government that says one thing and does another. We’re not going to be a government that promises with a wave of a magic wand we can fix every problem. But we are going to be a government which is committed with a hard head when it comes to spending taxpayers’ money, but a big heart when it ensures we can deliver some relief where it’s possible and practical.
JOURNALIST:
Minister, as much of the cost of sky-high airfares is about supply and demand as it is about anything else. Given that, should Qatar be permitted to fly more routes to Australia?
JONES:
Look, the two major carriers in Australia, Virgin and Qantas, have delivered over the last two decades cheaper airfares to Australians. The government has made a decision in relation to the Qatari case based on the evidence available to us, and I think the Minister and the Prime Minister have explained those decisions.
JOURNALIST:
What’s the national interest in that? That’s the phrase that’s always used by the Prime Minister and the Minister for not allowing Qatar to come to Australia or increase those flights. They say it’s in the “national interest”. What is it?
JONES:
We know that running an airline is an incredibly expensive operation. We saw that during COVID where airlines had to maintain their operations when they weren’t having revenue. We got a sneak peek insight into what it actually costs to run an airline. We can drive prices down but if we drive them down to a level where it’s actually unsustainable to run an airline, instead of having two carriers, we’ll design our markets in a way which will make it unsustainable for the existing Australian-based carriers.
So, we will ensure that we have a viable industry in Australia and we always want to ensure we’re doing things to drive down the cost of airline tickets in Australia, but we want to ensure that we do that in a way that doesn’t destroy the industry over the medium and long term.
JOURNALIST:
It’s pretty clear that the airline doesn’t need that protection from competition when they’re posting multibillion-dollar profits.
JONES:
Look, I’m not a defender of Qantas in any respect, but what I can say is the opposite of any airline that doesn’t post a profit. The opposite of an airline that doesn’t post a profit is one that’s running at a loss and one that’s consistently running at a loss and that’s the story for most national airlines around the country and so that’s the story for the most national airlines around the world. And so on having a national airline that occasionally posts a profit is not a bad news story. It’s actually a good news story.
The real issue here is that Qantas and other carriers are treating their customers respectfully, ensuring they’re providing the right sorts of services, on-time services, the lowest possible price tickets, baggage handling services that actually work and when planes are cancelled, you can get a refund or a credit that you can actually use. These are the real issues. We want to ensure that we have a market that’s sustainable over the long term. We want to ensure that Qantas and every other carrier, for that matter, is treating its customers properly. Thanks so much.