Australian Government, 2011‑12 Budget
Budget

Part 2: Expense Measures (Continued)

Treasury

A Tax Plan for Our Future — Tax Forum

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Department of the Treasury 0.9
Australian Taxation Office ‑0.9
Total ‑0.9 0.9

The Government will provide $0.9 million to the Department of the Treasury to support a two‑day tax forum in 2011‑12 to discuss the Australia's Future Tax System Review. The cost of this measure is fully offset by a reduction in funding for the Australian Taxation Office.

Advisory Panel on the Economic Potential of Senior Australians

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Department of the Treasury

The Government has established an Advisory Panel on the Economic Potential of Senior Australians supported by the Department of the Treasury to ensure that the potential of older members of our community is considered in a range of policy debates.

The Panel chaired by Mr Everald Compton AM, will examine the benefits and opportunities that come with a larger and more active community of senior Australians. The Panel will complement the work of the Consultative Forum on Mature Age Participation, which will continue to focus on measures to promote workplace participation.

Further information can be found in the press release of 30 March 2011 issued by the Deputy Prime Minister and Treasurer.

Australian Accounting Standards Board and Auditing and Assurance Standards Board — additional funding

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Office of the Auditing and Assurance Standards Board 1.1 1.1 1.1 1.1
Office of the Australian Accounting Standards Board 0.7 0.7 0.7 0.7
Total 1.8 1.8 1.8 1.8
Related revenue ($m)
Australian Securities and Investments Commission 1.8 1.8 1.8 1.8

The Government will provide $2.7 million over four years to the Australian Accounting Standards Board (AASB) and $4.5 million over four years to the Auditing and Assurance Standards Board (AUASB) to support their activities. The AASB develops and maintains financial reporting standards for all sectors of the Australian economy and contributes to the development of global financial reporting standards. The AUASB develops standards and related guidance to enhance the relevance, reliability and timeliness of information provided to users of audit and assurance services.

Funding will be offset by increased fees levied on companies by the Australian Securities and Investments Commission.

Australian Consumer Law — compliance and awareness of consumer guarantees law

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Competition and Consumer Commission 1.6

The Government will provide $1.6 million in 2011‑12 to the Australian Competition and Consumer Commission to educate consumers and businesses about the new consumer guarantee laws that form part of the Australian Consumer Law reforms which commenced on 1 January 2011.

See the related expense measures Australian Consumer Law — enforcement of consumer protection provisions in the 2011‑12 Budget, and Implementation of Unfair Contract Terms Provisions of the Australian Consumer Law in the 2010‑11 Budget.

This measure supports the implementation of one of the 27 deregulation priorities under the Council of Australian Governments' National Partnership Agreement to Deliver a Seamless National Economy.

Australian Consumer Law — enforcement of consumer protection provisions

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Competition and Consumer Commission 0.5 1.1 1.1 1.1 1.1

The Government will provide $4.9 million over five years to the Australian Competition and Consumer Commission to implement and enforce the consumer protection and fair trade provisions of the second tranche of the Australian Consumer Law (ACL) which commenced on 1 January 2011. The ACL provides uniform national consumer laws and enhances the protection of consumers.

See also the related expense measures Australian Consumer Law — compliance and awareness of consumer guarantees law in the 2011‑12 Budget, and Implementation of Unfair Contract Terms Provisions of the Australian Consumer Law in the 2010‑11 Budget.

This measure supports the implementation of one of the 27 deregulation priorities under the Council of Australian Governments' National Partnership Agreement to Deliver a Seamless National Economy.

Australian Energy Regulator — new consumer protection function

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Competition and Consumer Commission 5.4 5.4 4.2 3.6

The Government will provide $18.6 million over four years to fund the Australian Energy Regulator's new functions under the National Energy Customer Framework (NECF). The NECF harmonises state regulation for the retail energy market and distribution sector, and includes energy‑specific consumer protections such as approving retailers' hardship policies to protect consumers who experience payment difficulties.

The NECF will supersede the majority of State and Territory energy consumer laws. Jurisdictions have agreed to a target commencement date of 1 July 2012. The NECF is the last major legislative reform under the Australian Energy Market Agreement 2004. It is included in the implementation plan under the National Partnership Agreement to Deliver a Seamless National Economy as a key competition reform.

Australian Securities and Investments Commission — additional funding

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Securities and Investments Commission 28.8
Related revenue ($m)
Australian Securities and Investments Commission 18.8

The Government will provide $28.8 million in 2011‑12 to the Australian Securities and Investments Commission (ASIC) to support its operations in 2011‑12 pending a financial review of ASIC's to be undertaken prior to the 2012‑13 Budget.

$18.8 million of the funding will be sourced from interest revenue earned on unclaimed monies held in the Companies and Unclaimed Moneys Special Account (CUMSA). This component has no net impact on the budget as the interest earned by CUMSA is not included in Australian Government revenue until a decision has been made for its expenditure.

See also the related expense measures Global financial crisis — additional funding for regulators and the Treasury in the Mid‑Year Economic and Fiscal Outlook 2008‑09 and Global recession — additional funding in the 2009‑10 Budget.

Centre for International Finance and Regulation — transfer

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Department of the Treasury 2.6 4.5 4.0 1.0
Department of Education, Employment and Workplace Relations ‑2.6 ‑4.5 ‑4.0 ‑1.0 ‑2.0
Total ‑2.6 ‑1.9 0.5 3.0 ‑1.0

The Government will transfer responsibility for establishing and managing the Centre for International Finance and Regulation from the Department of Employment, Education and Workplace Relations to the Department of the Treasury. The Centre will provide opportunities for research into regional engagement, innovation, developments in the global financial sector and best practice financial regulation, and delivers education and training for financial regulators from Australia and the Asia Pacific region. It will also provide strategic links between academia, financial regulators, government and the finance industry.

The transfer will provide savings of $2.0 million over the forward estimates.

See the related expense measures Centre for International Finance and Regulation — establishment in the 2010‑11 Budget and Centre for International Finance and Regulation — redirection of funds in the Mid‑Year Economic and Fiscal Outlook 2010‑11.

Commonwealth Grants Commission — additional funding

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Commonwealth Grants Commission 1.0 1.0 1.0 1.0 1.0

The Government will provide $5.0 million over five years to support the operations of the Commonwealth Grants Commission (CGC). The CGC makes recommendations to the Treasurer on the allocation among the States of the Goods and Services Tax revenue.

Competition for Market Services

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Securities and Investments Commission 6.4 6.7 5.6 3.4 3.3
Department of Finance and Deregulation 0.1 0.1 0.1 0.1 0.1
Total 6.4 6.8 5.7 3.5 3.3
Related revenue ($m)
Australian Securities and Investments Commission 8.0 9.1 6.6 6.2
Related capital ($m)
Australian Securities and Investments Commission 0.5 3.4 0.4 0.3

The Government will provide $29.9 million over five years for the Australian Securities and Investments Commission (ASIC) to implement the Competition for Market Services policy and develop new market integrity rules. The new arrangements will allow competition between markets for trading in listed shares in Australia.

The Government will also provide $0.4 million over five years for the Department of Finance and Deregulation to undertake Gateway reviews of the project.

The funding for the measure will be offset by fees levied by ASIC.

Further information can be found in the press releases of 3 March 2011 and 29 April 2011 issued by the Assistant Treasurer and Minister for Financial Services and Superannuation.

See also the related expense measure Supervision of Australia's financial markets — reform in the Mid‑Year Economic and Fiscal Outlook 2009‑10.

Competitive and Sustainable Banking — trading of Commonwealth Government Securities on a securities exchange

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Office of Financial Management 0.9 3.5 3.4 3.4

The Government will provide $11.2 million over four years to the Australian Office of Financial Management to implement the trading of Commonwealth Government Securities (CGS) on a retail exchange, including the procurement of a securities exchange and stock registry facilities. Trading CGS will assist in the development of a deep and liquid corporate bond market, which provides Australian businesses with an alternative funding option to borrowing from the major banks.

Further information can be found in the Competitive and Sustainable Banking package, released on 12 December 2010 at www.treasury.gov.au.

Competitive and Sustainable Banking System reform plan — public awareness and education campaign

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Department of the Treasury 10.2 4.8

The Government will provide $15.0 million over two years to the Department of the Treasury to facilitate competition by raising awareness in the community about the range of banking options available.

Further information can be found in the press release of 12 December 2010 by the Deputy Prime Minister and Treasurer, and at www.treasury.gov.au/banking.

Distribution of the Goods and Services Tax — Review

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Department of the Treasury 0.8 0.2

The Government will provide $1.0 million over two years to the Department of the Treasury for a review of the distribution of the Goods and Services Tax. The Review will be led by the Hon Nick Greiner AC, the Hon John Brumby and Mr Bruce Carter. Treasury will absorb the cost of the Review Secretariat. The Review is to report in September 2012.

Further information can be found in the press release of 30 March 2011 issued by the Prime Minister and the Deputy Prime Minister and Treasurer.

Effective Carbon Prices in Key Economies — study

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Productivity Commission

The Government provided the Productivity Commission with $2.6 million in 2010‑11 to undertake a study into Emission Reduction Policies, and Carbon Prices. The Commission is to report to Government by the end of May 2011. The cost of this measure will be met from the existing provision for the Renewable Energy Future Fund.

This measure was a 'decision taken but not yet announced' at the Mid Year Fiscal and Economic Outlook 2010‑11, and delivers on the Government's agreement with the Member for New England.

Further information can be found in the press release of 15 November 2010 by the Deputy Prime Minister and Treasurer, the Minister for Climate Change and Energy Efficiency, and Assistant Treasurer.

Enhanced macro‑economic statistical capacity

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Bureau of Statistics 6.8 7.3 7.5 7.5
Related capital ($m)
Australian Bureau of Statistics 0.7 0.2

The Government will provide $30.0 million over four years to improve the collection and analysis of macro‑economic statistics by the Australian Bureau of Statistics. The funding will support the scope and quality of statistical outputs including the quarterly National Accounts.

Inspector‑General of Taxation — additional funding

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Inspector-General of Taxation 0.5 0.5 0.6 0.6
Australian Taxation Office ‑0.5 ‑0.5 ‑0.6 ‑0.6
Total

The Government will provide $2.2 million over four years to support the operations of the Inspector‑General of Taxation (IGT). The IGT undertakes independent reviews of systemic tax administration issues and provides advice to the Australian Government on improving tax administration.

This funding will be fully offset by a reduction in funding provided to the Australian Taxation Office.

Not‑for‑profit sector reforms — Australian Charities and Not‑for‑profits Commission — establishment

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Taxation Office 8.6 14.8 10.0 10.1
Related revenue ($m)
Australian Taxation Office 8.0 10.0 10.0 13.0
Related capital ($m)
Australian Taxation Office 1.0 9.1

The Government will provide $53.6 million over four years for the establishment of a new independent statutory agency, the Australian Charities and Not‑for‑profits Commission (ACNC), by 1 July 2012 and related structural changes required to the Australian Taxation Office (ATO).

An implementation taskforce (headed by the expected Commissioner of the ACNC) will also be set up in Treasury from 1 July 2011 to ensure the ACNC is ready for operation by 1 July 2012.

The Commissioner of the ACNC will be appointed by the Government and report to Parliament through the Assistant Treasurer. The Commissioner will have sole responsibility for determining charitable, public benevolent institution, and other not‑for‑profit status for all Commonwealth purposes. The ACNC will also initially be responsible for providing education and support to the sector; implementing a 'report‑once use‑often' general reporting framework for charities; and implementing a public information portal by 1 July 2013.

From 1 July 2011, the ATO will structurally separate its role of determining charitable status from its role of administering tax concessions, in preparation for the establishment of the ACNC. The Commissioner of Taxation will retain responsibility for administering tax concessions for the not‑for‑profit sector.

The ATO will provide corporate service support to the ACNC in the form of information technology services, human services, financial services and other related functions.

The Government will also undertake negotiations with the States and Territories on national regulation and a new national regulator for the sector, with the aim of minimising reporting and other regulatory requirements through coordinated national arrangements.

The measure is expected to result in additional tax revenue of $41.0 million over four years as a result of increased compliance activity to ensure that not‑for‑profit tax concessions are used only as intended.

This reform progresses another recommendation of the Australia's Future Tax System Review, and continues the process of tax reform started in May last year with the release of the Government's Stronger, Fairer, Simpler package of reforms.

See also the related revenue measures titled Not‑for‑profit sector reforms — better targeting of not‑for‑profit tax concessions and Not‑for‑profit sector reforms — introducing a statutory definition of 'charity'.

Petrol Commissioner and formal monitoring of petrol prices — continuation

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Competition and Consumer Commission 1.0 1.0

The Government will provide $2.0 million over two years to continue the formal monitoring of petrol prices under Part VIIA of the Competition and Consumer Act 2010 (formerly the Trade Practices Act 1974) and the role of the Petrol Commissioner.

Funding was originally provided until December 2010 in the 2008‑09 Budget and continued until December 2011 in the 2010‑11 Budget.

Stronger Super — MySuper

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Prudential Regulation Authority 4.3 7.5 6.5 5.9
Australian Securities and Investments Commission 0.8 1.1 1.3 0.5
Total 5.1 8.6 7.8 6.4
Related revenue ($m)
Australian Prudential Regulation Authority 5.1 10.0 8.3 6.5
Related capital ($m)
Australian Prudential Regulation Authority 1.4 0.5 0.1

The Government will provide $26.2 million (including $2.1 million in capital) over four years to the Australian Prudential Regulation Authority (APRA) and $3.7 million over four years to the Australian Securities and Investments Commission to introduce a simple, low cost default superannuation product called MySuper.

This measure will be funded by an increase in the levy on APRA regulated superannuation funds.

For further information see the press release of 16 December 2010 by the Assistant Treasurer and Minister for Financial Services and Superannuation.

Stronger super — self managed super funds

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Taxation Office 2.3 5.7 9.7 9.2 9.2
Australian Securities and Investments Commission 0.7 6.3 0.8 0.6
Total 2.3 6.3 16.0 10.0 9.8
Related revenue ($m)
Australian Taxation Office 10.0 12.0 12.0 13.0
Australian Securities and Investments Commission 1.0 0.4 0.4
Total 10.0 13.0 12.4 13.4
Related capital ($m)
Australian Taxation Office 1.1 1.1 1.0 1.0

The Government will provide $40.2 million (including $4.2 million in capital) over five years to the Australian Taxation Office (ATO) and $8.4 million over four years to the Australian Securities and Investments Commission (ASIC) to implement a range of measures relating to the self managed superannuation fund (SMSF) sector. The cost of this measure will be offset by a $30 increase to the SMSF levy with effect from the 2010‑11 income year, raising $47 million over four years, and the introduction of SMSF auditor registration fees from 1 July 2012, raising $1.8 million over four years.

The package of SMSF reforms announced by the Government are designed to improve the operation, efficiency and integrity of this sector and increase community confidence. The reforms include: the introduction of administrative penalties that the ATO can apply in cases of non‑compliance by SMSF trustees; the introduction of knowledge and competency requirements on SMSF service providers, including the registration of SMSF auditors; tightened legislative restrictions on SMSF investment in collectables and personal use assets; requiring SMSFs to value their assets at net market value and the ATO to publish valuation guidelines; the appointment of the ATO to collect and publish data on the sector; and changes to the registration and rollover processes, and illegal early release penalties to deter the use of SMSFs for illegal activity. These measures will have an ongoing unquantifiable revenue impact.

Most changes will have effect from 1 July 2012. Tighter legislative standards for investments in collectables and personal use assets will apply to new investments from 1 July 2011, with all holdings of collectables and personal use assets to comply by 1 July 2016. Amendments to the Anti‑Money Laundering and Counter‑Terrorism Financing Act 2006 will have effect from 1 July 2013 and amendments to the SMSF registration and rollover processes will have effect from 1 July 2014.

For further information see the Stronger Super Government Response to the Super System Review announced on 16 December 2010.

Stronger Super — SuperStream — initial funding

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Taxation Office 3.0 11.6
Department of Finance and Deregulation 0.1 0.1 0.1 0.1 0.1
Total 3.1 11.7 0.1 0.1 0.1

The Government will provide $14.6 million over two years to the Australian Taxation Office to develop a business case and initial capital related expenditure to implement a mechanism for members to view their superannuation accounts that have been reported to the ATO and establish governance and project teams during consultation to undertake detailed design of ATO IT systems to support the SuperStream measures.

The Department of Finance and Deregulation will also receive $0.4 million over six years from 2010‑11 to undertake a Gateway review of the project.

Further information can be found in the Government Response to the Super System Review at http://strongersuper.treasury.gov.au.

See also the related capital measure Stronger Super — initial funding for Self Managed Superannuation Funds Auditor registration in the 2011‑12 Budget.

Superannuation — financial assistance grants to compensate fund members for the failure of Trio

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Department of the Treasury 55.0
Related revenue ($m)
Australian Prudential Regulation Authority 55.0

The Government will provide grants of financial assistance under Part 23 of the Superannuation Industry (Supervision) Act 1993 to compensate members of four superannuation funds, formerly under the trusteeship of Trio Capital Limited, that suffered losses due to fraudulent conduct. The cost of these assistance grants will be $55.0 million in 2010‑11 and will be recovered through levies collected in 2011‑12 by the Australian Prudential Regulation Authority under the Superannuation (Financial Assistance Funding) Levy Act 1993.

Superannuation co‑contribution — extending the pause to the indexation of the income threshold

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Australian Taxation Office ‑25.0 ‑25.0 ‑25.0

The Government will continue the freeze, for an additional year to 2012‑13, of the indexation applied on the income threshold above which the maximum superannuation co‑contribution begins to phase down. This measure is expected to deliver savings of $75.0 million over three years from 2012‑13.

Under the superannuation co‑contribution scheme, the Government provides a matching contribution for contributions made into superannuation out of after‑tax income. The matching contribution is up to $1,000 for people with incomes of up to $31,920 in 2010‑11 (with the amount available phasing down for incomes up to $61,920). This measure will continue to freeze these thresholds at $31,920 and $61,920 respectively.

Tackling Climate Change — emissions reduction modelling — continuation

Expense ($m)
2010‑11 2011‑12 2012‑13 2013‑14 2014‑15
Department of the Treasury 3.3 3.3
Australian Bureau of Statistics 2.8 2.8
Total 6.0 6.1
Related capital ($m)
Australian Bureau of Statistics 0.2 0.2

The Government will provide $6.6 million over two years to the Department of the Treasury to maintain its existing capacity to model and analyse the aggregate economic, sectoral and distributional impacts of different emission reduction goals and trajectories.

The Government will also provide $5.9 million over two years (including $0.3 million in capital) to the Australian Bureau of Statistics to continue to produce annual Input‑Output data tables used for analysing policy options.

See the related expense measure Tackling Climate Change — Emissions Trading Scheme — design and implementation in the 2008‑09 Budget.

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