THE House of Representatives Standing Committee on Economics will hold its final public hearing in Canberra on Tuesday March 26, 2019 for its inquiry into the implications of removing refundable franking credits.

The chair of the committee, Tim Wilson MP, said, "The committee continues to gather evidence about how the removal of refundable franking credits would affect investors, particularly senior Australians whose financial security could be compromised."

Appearing at the hearing, the Self-managed Independent Superannuation Fund Association has called the ALP’s proposal regressive and inequitable, stating that it "goes against the progressive nature of the income tax system". 

Associate Professor Geoff Warren, who will also appear at the hearing, has said the proposal may cause adverse effects by "singling out a particular group within the context of a broader policy agenda".

The Australia Institute and Industry Super Australia will also give evidence at the hearing. The Australia Institute argues the proposal will mainly affect wealthy Australians and "could save the government around $35 billion per annum by the end of the forward estimates".

Similarly, Industry Super Australia argued "the vast majority of retirees will be unaffected by the proposal and the wealthy are the beneficiaries of most of the refunds of franking credit for non-pensioners".

Mr Wilson said, "The hearing will also provide an opportunity for Australians impacted by a change to refundable franking credits to address the committee directly with a three minute statement, and we welcome their contributions and participation."

Public hearing details:

Date: Tuesday, March 26, 2019, 1pm–4.40pm
Venue: Main Committee Room, Parliament House, Canberra

Program

1.00pm The Australia Institute
1.30pm Associate Professor Geoff Warren, Australian National University
2.00pm Self-managed Independent Superannuation Fund Association
2.30pm Break
2.40pm Industry Super Australia
3.10pm 3 minute public statements
4.40pm Finish

The hearing will be webcast live.

A number of submissions have been received and are available on the committee’s webpage at: www.aph.gov.au/economics. Further submissions are currently being processed and will be published over the coming weeks. Submissions can still be made online or by emailing This email address is being protected from spambots. You need JavaScript enabled to view it.. 

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AUSTRALIA's shipping industry is in crisis, putting the nation’s economic, environmental, and national security at risk, but urgent government reform could address the issues and deliver a multi-billion dollar benefit to the economy, according to the Maritime Union of Australia (MUA).

The union today presented a detailed proposal to the Senate Rural and Regional Affairs and Transport References Committee inquiry into the Australian shipping industry in Melbourne, including recommendations that the Australian Government:

• provide tax incentives to support investment in ships, ship-related infrastructure, and local seafarers;
• reform the seafarer visa system to improve maritime security and support skills investment;
• reform legislation and regulations governing coastal trading;
• create a national strategic fleet to guarantee fuel security and enhance the nation’s economic security;
• develop a strategic approach to maritime workforce development; and
• introduce better ship safety and pollution reduction measures to protect Australia’s coastlines, tourism industry and oceans.

“There’s no question that Australian shipping is in crisis,” MUA national secretary Paddy Crumlin said.

“Since 2013, we’ve lost more than half our remaining coastal fleet, leaving the country with just 12 large trading vessels to carry our growing coastal cargoes.

“With the right political leadership and policy settings, this dramatic decline can be arrested and our shipping industry can be rebuilt.”

Mr Crumlin said ongoing political inaction was causing a serious drain to the nation’s economy.

“Each Australian vessel that is lost is replaced by foreign ships that don’t pay tax here, don’t employ local seafarers, and don’t support local maintenance and service businesses,” Mr Crumlin said.

“The result is a major drain on the economy, with the use of foreign vessels to transport Australian resource and agricultural exports, along with coastal cargoes, estimated to be costing the nation more than $8 billion a year.

“Our research suggests that current coastal cargoes are sufficient to sustain between 50 and 60 additional Australian ships, but we need the political will and right policy settings if Australia is to once again become a shipping nation.”

Mr Crumlin outlined the union’s vision to save Australian maritime industries through both reforming cabotage laws and creation of a new national strategic fleet.

This would be achieved by expanding on the nation’s expertise and innovation in a range of maritime sectors, including:

• offshore oil and gas exploration, construction, production and transportation;
• opportunities in the emerging offshore wind farm sector;
• defence shipbuilding arising from the Federal Government’s existing $80 billion investment in the sector;
• civilian shipbuilding, particularly aluminium hulled ships;
• expedition cruise shipping and other forms of marine tourism; and
• marine and oceanographic research.

This would result in a maritime cluster that would be a significant economic boost to the nation, the MUA reported.

“At its core, government policy must aim to maintain and grow Australian maritime skills,” Mr Crumlin said.

“As an island nation, we depend on maritime skills to operate our ports, our regulatory and safety agencies, our freight and logistics sectors, tourism, and offshore oil and gas industries.

“This must include industry incentives that encourage investment in modern and efficient ships that are owned and operated by Australians.

“The introduction of purpose-built Australian ships would create a more productive freight network for Australia, delivering businesses greater flexibility, reliability, efficiency and productivity.

“This national strategic fleet will also protecting our environmental, fuel, and national security by providing greater control over the vessels that operate in our national waters.

“But before any of this can be achieved, we need clear vision and leadership from government.”

www.mua.org.au

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FOUNDED in 2017 by comedian and entertainer George McEncroe, women-only ride-sharing service Shebah has since recorded growth of 190 percent, turning over $1.8 million in 2018, up from $500,000 in 2017.  

The company began its equity crowdfunding campaign two weeks ago aiming to raise $3 million. The capital raised will enable the company to grow its geographical footprint in Australia, launch into New Zealand and further develop the user experience on the app since its rapid growth in 2018.

So far the investment campaign has made history raising close to $1 million of which 95 percent has come from female investors. This is significantly higher than the average 17 percent that capital funding platform Birchal has seen on its platform to-date.  Majority of the company’s new investors are becoming shareholders for the first time having experienced the Shebah service first-hand.

According to CEO George McEncroe,"We wanted to offer the fruits of our future success to the women who helped us grow, so we went out to the community of drivers and our passengers first.  We were mindful that on average less than 3 percent of VC investment goes to female-led businesses in Australia and New-Zealand, a statistic we hope to see change. So starting with our loyal base made sense as they believe in our core purpose and in potential to grow."

A recent Forbes and TINYPulse report showed that, startup companies with female founders at the helm almost universally outperformed and are the fastest growing companies. Investors are starting to recognise this and growth in female-led businesses is set to increase.

The company’s founder also acknowledged the diversity within its new investor group and the reasons behind investor support.

"We seem to have started a social movement of sorts, something that women in particular feel strongly about and a service they believe is needed. Our investment group is incredibly diverse, including politicians, experienced investors (male and female) and mothers throughout Australia."

The exclusive community-only investment period has now closed and investment is open to the public, with only 18 days remaining.  The company aims to reach its goal of $3m in the coming weeks, at which point it will embark on an accelerated growth phase for the coming years.

The Australian rideshare industry is worth $290 million and the taxi industry is worth $6 billion, with the market growing at 14 percent year-on-year, this is forecast to continue for a decade.

www.shebah.com.au

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MORTGAGE CHOICE chief executive officer, Susan Mitchell, has welcomed the Federal Government’s decision today to maintain trail commissions on new loans and undertake a review in three years. 

In his statement today the Treasurer, Josh Frydenberg, said abolition of trail won’t proceed in 2020 because the government is concerned about the adverse effect on competition in mortgage lending market. He also conceded that abolishing trail would be “a free kick to the banks”.

The government will review trailing commissions in three years time, as well as the feasibility of continuing upfront commission payments. The review will be conducted by the Council of Financial Regulators and the Australian Competition and Consumer Commission (ACCC).

Treasurer Frydenberg acknowledged that mortgage brokers and small lenders are “absolutely critical in the mortgage lending market”. 

Ms Mitchell said, “I wholeheartedly support Treasurer Frydenberg’s announcement to maintain trail commissions. It is clear that abolishing trail would have an adverse effect on the home lending market and would be detrimental to competition.

"Australia’s 17,000 mortgage brokers will applaud the Government’s common sense decision to keep trail commissions. ASIC’s 2017 Review of Mortgage Broking Remuneration Report did not identify trail commissions as directly leading to poor consumer outcomes, nor recommend the removal of trail commissions.

“The figures speak for themselves. The latest data shows that 59.1 percent of home loans originate through the mortgage broking channel, yet Australian Financial Complaints Authority (AFCA) data for the month of November 2018 revealed that of 6,522 complaints against financial service providers,  only 29 related to mortgage brokers. This is less than half of one percent of reported complaints.

“Furthermore, brokers drive competition in the lending market. Proof of this can be seen in Mortgage Choice residential settlement figures, which show that in the past two years the big four banks have lost 10 percent of market share to smaller lenders.

“Maintaining competition in the mortgage industry is of the utmost importance to every borrower in Australia. Mortgage Choice brokers have been helping Australians realise their property ownership goals for 27 years.

"We believe that maintaining trail commission will ensure a strong mortgage broking industry and allow brokers to continue to guide Australian borrowers through what may be the most significant financial commitment of their lives - buying their home,” Ms Mitchell said. 

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