Revised Explanatory Memorandum
(Circulated by authority of the Assistant Treasurer, the Hon. Stuart Robert MP)General outline and financial impact
Improving protection for whistleblowers in the corporate and financial sectors
The amendments in Part 1 of Schedule 1 to the Bill amend the whistleblower protections in the Corporations Act so that a single, strengthened whistleblower protection regime covers the corporate, financial and credit sectors.
This Part brings the whistleblower laws in other financial system statutes into the Corporations Act.
Date of effect: The amendments generally apply to disclosures made on or after the first day of the second quarter following Royal Assent.
The amendments also apply to conduct in breach of sections 1317AC, 1317AD and 1317AE, and any other provision of Part 9.4AAA to the extent that it relates to those sections, as in force immediately after the commencement time for a disclosure that:
- (a)
- was made before the commencement time; and
- (b)
- would be a disclosure protected by Part 9.4AAA, if the amendments made by Part 1 of Schedule 1 to the Bill had been in force at the time the disclosure was made.
Proposal announced: The Government committed in December 2016, as part of the Open Government National Action Plan, to ensure appropriate protections are in place for people who report corruption, fraud, tax evasion or avoidance, and misconduct within the corporate sector. To achieve this, the Government committed to pursuing reforms to whistleblower protections in the corporate sector.
Financial impact: Minimal.
Human rights implications: This Bill does not raise any human rights issue. See Statement of Compatibility with Human Rights - Chapter 5.
Compliance cost impact: The estimated overall average compliance cost is $15.4 million per year over ten years.
Summary of regulation impact statement
Regulation impact on business
Impact: These amendments will primarily affect companies and other entities that will be required to develop whistleblower policies and/or potentially deal with greater whistleblowing activity.
Main points:
There are three policy options available to the Government:
- •
- Option 1: Maintain the status quo;
- •
- Option 2: Reform whistleblower protections in the corporate sector only;
- •
- Option 3: Reform and consolidate into the Corporations Act whistleblower protections currently available to whistleblowers across the financial system under legislation within the remit of ASIC and APRA and expand protections to disclosures of corporate misconduct more generally.
Each option is expected to impose the following compliance costs per year:
- •
- Option 1: no compliance costs;
- •
- Option 2: $15.6 million per year
- •
- Option 3: $15.4 million per year
There are no expected compliance costs for individuals or community organisations.
Better Protections for Tax Whistleblowers
The amendments in Part 2 of Schedule 1 to the Bill insert a comprehensive regime into the TAA 1953 for the protection of individuals who report breaches of the tax laws or misconduct.
Date of effect: The amendments generally apply to disclosures made on or after the first day of the second quarter following Royal Assent.
Proposal announced: The Government announced in the 2016-17 Budget that new arrangements to better protect individuals who disclose information to the ATO on tax avoidance and other tax issues would be introduced. This announcement was reaffirmed in December 2016 when the Government committed to the Open Government National Action Plan.
Financial impact: Unquantifiable.
Human rights implications: This Bill does not raise any human rights issue. See Statement of Compatibility with Human Rights - Chapter 5.
Compliance cost impact: There are no compliance costs from the implementation of the tax whistleblower regime.
Summary of regulation impact statement
A regulation impact statement was not required in relation to the new tax whistleblower regime.