Treasury Laws Amendment (Financial Reporting System Reform) Bill 2026

Senator McDONALD (Queensland—Deputy Leader of the Nationals in the Senate) (13:17): I suspect I'm one of the few certified practising accountants or chartered accountants in the parliament currently. As a CPA, there is a small part of me that reflects on the concept of accountants being described as 'cowboys', 'marauding' or anything vaguely interesting as probably good for our reputation!

I want to reflect on the work that has been done by so many people in the Senate and the House across this. I think the work has been important, particularly the whistleblower work. I think that is important.

I want to congratulate Senator Pocock, Senator O'Neill and others for making this their life's work. Senator O'Neill: And Senator Scarr. Senator McDONALD: And Senator Scarr; thank you very much, Senator O'Neill.

I do want to flag, though, that because accountancy is an incredibly complex and highly professionalised area, I'm very concerned that there is a misunderstanding that you can take out the complexity. Though, I do acknowledge the increased complexity that's been introduced by the Labor government under this budget. It becomes increasingly impossible for Australians to be able to manage their own tax affairs and financial management affairs thanks to the introduction of more complexity as legislated by the government.

But it takes an incredibly complex profession, with complex standards and requirements, and seeks to somehow mush it all together. Senator Pocock herself just spoke about the structural separation of audit standards from others. And yet, this legislation seeks to do the opposite.

We have the Financial Reporting Council, the Australian Accounting Standards Board and the Auditing and Assurance Standards Board, all of whom do incredibly separate work. There is deliberate structural separation. And yet this legislation will seek to merge those bodies.

The oversight body does not seek to write technical standards. That is a separation that enforces and provides independence. I think that this is a lack of understanding of the way legislation is constructed and the way that the technical nature of the separation of duties within accountancy firms works.

This legislation, I think, seeks to solve a problem of individuals by legislating for a much broader outcome. There is a common expression out in the real world: 'To a man with a hammer, the whole world looks like a nail.' I'm afraid that this is a piece of legislation that is looking for a solution rather than an outcome that would be more practical. I'm not sure if the Senate is aware of the crisis that is happening in the accounting profession in Australia currently, with the introduction of the government's massive overreach into scope 2 and 3 reporting.

The expansion of ESG reporting has meant that there is such a shortage of practical accountants in the business that we have now offshored a huge amount of our accounting work to other countries. Every accountancy business around Australia will tell you, if pressed, that they are outsourcing a significant amount of work to other jurisdictions. I think this is a terrible shame.

Young Australians who should be involved in what is, in my experience, incredibly interesting and constructive work in being an accountant, particularly in a business, are now losing that opportunity because they are being soaked up into these meaningless reporting areas. I should say that these are well-paid jobs that suck them out of small business and medium-sized business.

Instead, we are outsourcing those roles. I reflect on how in the 1990s, following the Enron scandal, the collapse of Arthur Andersen saw young Australians miss out on professional years on jobs—28,000 people lost their jobs as a result of that closure. I think this Senate and this parliament would do well to reflect on interfering in sectors of the economy that they are not well experienced to make decisions on and to write legislation on.

I think this legislation is incredibly heavy handed. It will not force the outcomes that are sought by the government. Of course, once again, we have a deal with the Greens that means that we see structural changes to things like the self-managed super funds and their ability to borrow to invest in the property market—things that have not been well examined by either the House of Representatives or the Senate, because they are rushed through as part of these deals.

I think that that will, in itself, reduce the number of houses that are available to Australians. We know that that would impact the construction of approximately 4,000 new homes, which will be removed under the Greens-Labor deal. We all share concerns about the big four accounting firms, especially the recent conduct of KPMG, but that does not mean that we should launch a political purge of a sector that is already in real distress.

I cannot emphasise that enough. We will look forward to seeing what further deals are done with the Greens that allow the government to progress more complexity of accounting regulation and probably more tax changes. I expect that we'll see a tax on the family home.

We're going to see more inheritance taxes and death duties. Certainly, fuel tax credits are something that we are constantly watching to ensure that the government doesn't do a deal with the Greens, something that would devastate Australian fishers, farmers and miners. In summary, I think that the government has got the wrong priorities for this financial services reform.

Australians are facing real pressure—real living pressure—in financial services. We know that home insurance premiums are up around 50 per cent over the last five years. We're seeing regional bank closures.

We're seeing a rise in financial scams and failures that ASIC, the regulator, is failing to stop, including First Guardian, Shield, Lion Property Group and Australian Fiduciaries. There have been at least eight parliamentary inquiry reports into this sector, on financial services, that have been tabled since 2024, yet the government has not responded to any of them.

We're told there's not enough capacity to respond to these, yet there is capacity to legislate—and, as I've already flagged, with unintended consequences and with poor outcomes for Australians and also for an important financial sector in this economy.