Cosgrove Clayton: Financial Reporting Bill — First Reading 
Text is incorporated into the Bound Volume 
Cosgrove Clayton: Financial Reporting Bill — First Reading 
[Sitting date: 28 November 2012. Volume:686;Page:6904. Text is incorporated into the Bound Volume.] 
Hon CLAYTON COSGROVE (Labour) 
: 
 The last speaker Michael Woodhouse made a point that I thought was a very very valid one. He said I think that in his days as a chartered accountant he had a lot of small-business people who came in with the shoebox the briefcase or whatever with the monthly receipts and handed them to the accountant and said: “Please sort it out.” I am guilty as charged. When I was a small-business person I was blessed with a very good accounting friend whom I would take the shoebox to with all the receipts and he was a very very good accountant. He would sort it out and make sure that I acted legally—acted legally which is important—and paid my tax and met all my particular obligations. He gave me good advice in respect of what I was required to do. 
This bill the Financial Reporting Bill we will support to the select committee as my colleague David Parker has said because this bill I think in its essence—the theme of this bill could be described as having the balance between good regulation and not excessive regulation. We need to ensure we have good regulation. I am wondering tonight whether the Minister for Small Business the Hon John Banks—and I use the word “honourable” advisedly—this bill is about reducing essentially compliance costs as well. We know that the mission of the small business Minister his mission in life his mandate and his portfolio of course is to reduce compliance costs. 
Hon John Banks 
: That’s right. 
Hon CLAYTON COSGROVE 
: Who said that? 
Hon John Banks 
: The Minister. 
Hon CLAYTON COSGROVE 
: Oh the Associate Minister said that and that is true. The difficulty is that we are still waiting. This is relevant because my colleague David Clark— 
Hon John Banks 
: Who? 
Hon CLAYTON COSGROVE 
: This is relevant to this legislation. He is the person who has a memory and does not have amnesia Mr Banks. He can remember his own name unlike the member. Mr Woodhouse mentioned an interesting theme. He mentioned cabbage boats in his speech. I know that I have to comply with the Standing Orders so I know that I cannot move outside the bill unless the previous speaker has drawn other themes in—oh yes. 
But anyway the issue is this. This is a good piece of legislation on the face of it. We want to ensure of course that there is an appropriate level of regulation but not excessive. I am the Opposition spokesperson on small business and as a former Minister for Small Business what we all seek is to reduce compliance costs on the commercial sector. If you can reduce compliance costs you become more efficient and more competitive. So I wait with interest—unless the four headless horsemen have got to the Minister for Small Business before me the sort of walking dead—as to whether Mr Banks will get up and take a call and give his view on this legislation. I think this is a fair attempt colleagues—a fair attempt. This is a weighty piece of legislation. This is important legislation because what it will encourage is giving access in a more simplified and transparent form to financial information to the ordinary punter. I wait with interest. This is a real and genuine attempt I think—we do not know whether it is a valid attempt—to reduce some compliance costs of business. Unlike “Lazarus” over there—the resurrection has happened—whose only achievement in the Parliament is to introduce a piece of legislation that expunges 31 Acts that do not exist. That is the contribution— 
Hon John Banks 
: Ha ha! 
Hon CLAYTON COSGROVE 
: He is laughing. It is a nervous laugh. It is the sort of nervous laugh you get when you are handed a bag of dough and you pass it on to your campaign manager and you pretend you do not know who gave it to you and what was in it. It is a nervous sort of little laugh. It is the sort of nervous laugh you have when the courts call you on 12 December to answer a few questions that you would not answer to journalists and you would not answer in the Parliament. And he is on—[ 
Interruption 
] Mr Deputy Speaker I think you should call the zambuks. I think the Minister for Small Business is having a difficulty. 
Mr DEPUTY SPEAKER 
: Come back to the debate. 
Hon CLAYTON COSGROVE 
: Well he is on his cellphone. You are the Speaker. 
Mr DEPUTY SPEAKER 
: That is right and I have requested that the member speak to the first reading. 
Hon CLAYTON COSGROVE 
: Oh absolutely and I am. “The main purpose of the Bill”—and I will read it in case we need reminding—“is to improve the financial reporting system by making all general-purpose financial reporting consistent with the primary objective of the financial reporting system. That objective is to provide information to external users who have a need for an entity’s financial statements but are unable to demand them.” That is also reducing compliance costs and it is germane to ask the Minister for Small Business wherever he may be under whatever desk or piece of carpet—maybe he is under the lambskin over there—whether he will contribute to this debate because this is very very important. 
The heart of this piece of legislation as a colleague of mine suggested to me before I stood up is a balance as I have said between good regulation and excessive regulation. Good regulation is transparent. The entities that have to use that legislation know what it means and they know how to comply with it. Actually if we had had good regulation perhaps around say the “Local Government (Donation) Act”—there is a good example—then a certain person in this Chamber would have known exactly what the regulation meant. 
Hon David Parker 
: It was clear. 
Hon CLAYTON COSGROVE 
: It was clear. I am not a lawyer. My colleague David Parker is a learned lawyer and he said that that regulation was clear. I suppose what it sets as an example and Mr Banks could talk to this in great detail is that if legislation and regulation is presented in a form where it is user-friendly then there is a higher chance of compliance—a higher chance of compliance. But that also means of course that that requires a bit of intelligence on behalf of the user. In the case of the Minister for Small Business we know that is a wee bit of a dicey concept. 
This is important legislation. I am interested also in asking the Minister as to where that puts us in line with Australia—where that puts us in line with Australia—because one would not as Mr Parker said want to overly burden small capital - raising companies as they are attempting to grow with excessive regulation. We know that across the Ditch there is a scheme of arrangement that I think may be slightly better than ours in terms of allowing companies to flourish and grow. Of course in Australia they have a massive capital fund because they have compulsory superannuation. The place is awash with capital and companies can grow and prosper because they have access to that. 
But the question I would raise and what we would like to look at in the select committee is where does this put us in line with our Australian competitors? We need to be on a parallel basis to them. We may want to have a higher standard than them. But we do not want to be put in a position our particular companies where we have greater regulation excessive regulation attempting by its objective to do good things but effectively hog-tying our companies and penalising our companies and advantaging by definition those in Australia. They are our closest trading partners and whether it be the law or banking or commercial enterprise Governments of all shades have attempted to ensure that regulation is consistent where possible or to transition that regulation where possible so that we are consistent with Australia to make it easier for our companies to do business. 
I welcome this legislation. I think we are going to have to put it under significant scrutiny. I would wager that it is a good attempt a fair attempt to try to do some good work in the commercial sector to reduce compliance costs. I have to say in concluding that this is a weighty piece of legislation as opposed to the bunkum and the despicable attempt by Mr Banks to bring in legislation that effectively was piffle. Even his coalition colleagues over there—oh he is back—knew when he stood up and pronounced that his legislation was groundbreaking that small businesses would throw petals at Mr Banks as he walked down the streets of Auckland celebrating what a wonderful gentleman he was and what wonderful things he had done for small business until they realised that all— 
Hon John Banks 
: Great mayor. 
Hon CLAYTON COSGROVE 
: “Great mayor.” he says. Yes a mayor who trebled the debt in 3 years—what a cracker he was “Mr Spendthrift”! That was until those small businesses realised of course that all he did was repeal 31 Acts that did not exist. But I say to Mr Banks that I welcome his call on this bill we all welcome his call on this bill and we also welcome the date of 12 December not because the House is going to rise but because our wonderful judiciary in its own inquisitorial fashion will ask some very penetrating questions of the member of Parliament. 
Hon John Banks 
: It’s all BS. 
Hon CLAYTON COSGROVE 
: It is all BS? Well we will see what happens there. I have got a feeling that the four judicial headless horsemen may be after Mr Banks. They may just get him and we may have a vacancy in this Parliament.