The new rules will apply to companies with liabilities below $1 million and allow them restructure and avoid receivership or voluntary administration.
Treasurer Josh Frydenberg said the move from a “creditor in possession” model to a “debtor in possession” model would ensure eligible companies could restructure their debts while remaining in control of their business.
The new regime will kick in just as the temporary insolvency relief package, introduced at the beginning of the coronavirus pandemic, expires.
Under the package, the threshold for creditors to initiate insolvency proceedings was increased from $2000 to $20,000, while the time to respond to statutory demands was extended to six months.
Temporary relief for directors from insolvent trading laws will also come to an end, with banks and insolvency experts expecting to see a spike in corporate collapses in the first half of 2021.
From January 1, the threshold for personal bankruptcy actions will fall from a temporary rate of $20,000 to a permanent rate of $10,000, which is still above the pre-COVID level of $5000.
The $0 threshold for all foreign investment in Australia will end on January 1, however screening by the Foreign Investment Review Board (FIRB) will continue for investments in sensitive national security land or businesses.
Treasury officials will also be given enhanced monitoring and investigation powers, as well as stronger and more flexible enforcement options and penalties for breaches of investment rules.
The government’s Your Super, Your Choice laws will come into effect on January 1, bringing to an end the practice of forcing workers into certain superannuation funds through their enterprise agreement.
The new rules, which will allow people to choose their own super account, will apply to all enterprise agreements made on or after July 1, 2020.
The scheme allowing workers hurt by the coronavirus pandemic to withdraw up to $20,000 from their super accounts will also come to an end.
The government’s controversial shake-up of universities fees will commence in 2021, with the cost of degrees in areas such as law, economics and the arts hiked to offset lower fees for degrees linked to future job demand.
The cost of studying maths or agriculture will fall by up to 61 per cent, while courses not directly leading to in-demand jobs will cost students more – humanities students will pay 113 per cent more for their degrees.
Fees for nursing and teaching will fall by 45 per cent and for science by 23 per cent, while a law degree will cost students 28 per cent more.
The package will also see an additional $400 million flow to supporting rural and regional universities and students, and an additional 30,000 government supported university places funded.
Around 2 million students and unemployed people will lose $100 a fortnight from their JobSeeker and Newstart payments in the new year, as the coronavirus supplement decreases from $250 per fortnight to $150.
The government introduced the $550 coronavirus support supplement in March, effectively doubling taxpayer support for the unemployed at a time when hundreds of thousands of people were losing their jobs.
The supplement was reduced to $250 on September 25, will drop to $150 from January 1, and is legislated to end on March 31. Labor and social services groups have called for the reduction to be relayed or scrapped.
The rate of JobKeeper will also reduce to $1000 per fortnight for employees working 20 hours or more per week and $650 for those working fewer than 20 hours per week. JobKeeper, too, is slated to expire in March 2021.
Waste glass export ban
The first stage of an ambitious four-year plan to ban the $290 million annual export of 1.4 million tonnes of waste plastic, paper, glass and tyres will kick-off on January 1, with an ban on unprocessed waste glass.
Initially scheduled to begin on July 1, 2020, the waste glass export ban was delayed by six months due to the coronavirus pandemic.
A ban on mixed and dirty plastics (other than PET style plastics) and whole tyres is still set to commence on July 1, 2021.