The Australian, December 23, 2016
The government should immediately launch a review of the ASIC companies registry which is “screwing” small business out of hundreds of millions of dollars a year in red tape fees, says Small Business and Family Enterprise Ombudsman Kate Carnell.
Ms Carnell, the country’s first small business ombudsman, welcomed the Turnbull government’s decision to back down from its controversial plan to sell the Australian Securities & Investments Commission’s companies registry, but said it opened an opportunity to rationalise the system.
The tender process was closed without a sale after bids for the public database were found to fall well short of the revenue received by gouging users for access, with the announcement laid out in this week’s midyear economic and fiscal outlook.
“We opposed the sale because we didn’t think there were adequate safeguards to stop it being even more expensive than it is now,” Ms Carnell told The Australian. “And because we thought it was really important to focus on some rationalisation between the ASIC registry and the Australian Business Register that sits within the ATO.”
The scuttling of the proposed sale was welcomed by independent senator Nick Xenophon, the public sector union, accounting body CPA Australia and campaigning group GetUp, which had lobbied against the tender for potentially putting at risk public access to information, already charged at a price more than 100 times what it costs to operate — comparatively one of the highest fees in the world.
Finance Minister Mathias Cormann said the government would not proceed with a sale of the registry because it did not deliver a “net financial benefit to the commonwealth”.
Ms Carnell said the government should now use this opportunity to review the charges and focus on a “user pays” model. “In other words: charging what it costs — not a significant amount more than what it costs,” Ms Carnell said.
The cost to ASIC of operating the registry, less than $6 million a year, bears no resemblance to how much it charges business and the public for using it — about $720m annually, a return to government coffers of more than 10,000 per cent.
Companies — the vast majority small businesses — are slugged about $660m a year to lodge documents with the corporations registry and the public is charged $60m a year to access that information, or $720m in total.
It appears unlikely the exorbitant charges will be lowered.
“In this case, small business is paying significantly more than what it costs and significantly more than big business in what their capacity is to pay,” Ms Carnell said.
Ms Carnell said both sides of government had presided over the high fee structure charged by the ASIC registry, but there was now a timely opportunity to review it and the ABR register.
“Let’s have a look at the cost of using the registries and make sure it isn’t a way of screwing small business. I don’t think they mean it that way but it has turned out that way and now it’s time to change it,” Ms Carnell said.
“Make it user pays, but don’t make it a profit centre,” she said.
After the sale was disbanded, ASIC commissioner John Price told staff in an internal email the tender “highlighted the need to consider registry modernising functions more broadly across government”.