National

Public service red tape assassination squads cost millions

Nationals Senator Matthew Canavan said the red tape reduction was vital because Australian businesses were exposed to ...
Nationals Senator Matthew Canavan said the red tape reduction was vital because Australian businesses were exposed to international competition. Photo: Michael Mucci

Red tape assassination squads in the public service are costing up to $2.1 million while the opposition has labelled the Abbott government's purge of regulation a hyped-up war on punctuation marks.

Answers to questions on notice asked by Labor Senator Joseph Ludwig show special red tape razor gangs at major departments usually had six to nine senior public servants working to reduce regulation. 

Treasury has one of the biggest red tape reduction squads with its deregulation division costing $2.14 million a year, although it reported $227 million in gross compliance savings in February. 

The Australian Tax Office (ATO) had five bureaucrats, four all executive level 1 and 2 public servants led by a band 2 senior executive, slashing red tape and reported $191.2 million worth of compliance reduction in June✓. 

The Department of Industry was spending $850,000 on its regulation reform policy branch while it was costing the Department of Social Services (DSS) $700,000 annually for its red tape slashing squad.

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On Monday the Senate debated separate cuts to red tape identified by the federal government's purge of regulations across 10 portfolios as part of the omnibus repeal bill yet to be brought into action.

Nationals Senator Matthew Canavan said the red tape reduction was vital because Australian businesses were exposed to international competition.

Mr Canavan said one of the most important changes being introduced was senior executive remuneration in the public service would be linked to reduction of red tape. 

"The accumulation of bad regulations is largely the result of bad incentives in the public service - it's not a consequence of bad intentions," he said.

"There are not people in the public service who want to punish business."

Mr Canavan said regulation could seem costless to some public servants because the alternative was to seek more budget funding, which involved much bureaucratic effort to put forward a budget submission, whereas regulation costs were borne by the private sector or not-for-profits.

He said Australia's tax assessment act - set to be trimmed by the repeal bill's measures - grew by 7000 pages from a mere 120 pages in 1936.

"If we continue to grow the tax rate at that rate, it will take be 830 billion pages, it will take 3 million years to read and will weigh the equivalent of 20 aircraft carriers," Mr Canavan said, also noting his example displayed the power of compound growth. 

The opposition said it had taken six months for the government's autumn omnibus repeal bill to reach the Senate after being passed in the House of Representatives, despite the Coalition's statements that these regulations were burdensome on business. 

Others from the opposition said the repeals would only affect those in industries' relegated history books, such as the mule and bullock trades, while Labor's Mr Ludwig said the repeal bill would not achieve savings. 

"The government's commas and typos patrols are just farcical," Mr Ludwig said. 

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