OVER the next two Fridays, the House of Representatives Standing Committee on Tax and Revenue is holding public hearings for its Inquiry into the Development of the Australian Corporate Bond Market.

The chair of the committee, Jason Falinski MP, said the committee looked forward to hearing from key peak bodies and market participants about potential barriers in the regulatory regime for corporate bonds.

“The Australian corporate bond market, despite regulatory changes over the last decade, remains small compared to other countries”, Mr Falinski noted, “This inquiry will be looking at why that might be.

“Examining the tax treatment of corporate bonds for issuers and investors will provide a clearer view of any impediments to the issuance of bonds compared to other asset classes,” Mr Falinski said.

The committee will also look at how certain policy settings have helped to build more active retail corporate bond markets in other jurisdictions, especially those that attract substantial issuance from Australian corporations.

Further information about the inquiry is available on the Committee’s website.

Upcoming public hearings

Date: Friday, 6 November 2020
Time: 9am to 12.15pm
Location: Committee Room 2R1, Parliament House, Canberra (via video/teleconference)

Date: Friday, 13 November 2020
Time: 9am to 11.45am
Location: Committee Room 1R3, Parliament House, Canberra (via video/teleconference)

The hearings will be broadcast live at aph.gov.au/live.

ends

KEY PLAYERS in the superannuation sector will be scrutinised at the House of Representatives Standing Committee on Economics public hearing on Friday.

Committee Chair Tim Wilson said Friday’s hearing would provide an opportunity to ask questions about superannuation funds’ response to COVID-19.

“Before COVID-19 we have been scrutinising the super sector to ensure they’re putting members and their interests first, and the significant number of Australians who have accessed their super during the pandemic highlights the need for the sector to be there when Australians need them," Mr Wilson said.

“The scrutiny the Economics Committee has applied to the sector has led the government to propose welcome reforms to ensure that funds are acting consistent with member’s best interests.

“Similarly, it is important that the sector is not using its leverage to achieve interests not aligned with financial returns for members, such as needless advertising for a compulsory product or to intimidate listed companies to be participants in public debate.

"I’m looking forward to exploring this topic further, as particularly in times like these it is crucial that the superannuation sector is operating effectively, fairly and to the benefit of fund members."

The hearing forms part of a broader review of Australia’s four major banks and other financial institutions. Examination of these institutions will also include monitoring the sector’s progress on implementing relevant recommendations from the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.

A full program for the hearing is available on the committee’s website.

Public hearing details

Date: Friday, 6 November 2020
Time: 10.30am to 4.45pm
Location: Videoconference

The hearings will be broadcast live at aph.gov.au/live.

ends

SUPERANNUATION funds are increasingly offering members exchange traded funds to diversify their portfolios at low cost and enter into overseas markets. Overseas equities now have the highest allocation at about 25 percent.

But this is harming the sector charged with incubating our companies of the future, according to Stoic Venture Capital partner Dr Geoff Waring said Australian startups were being held back by the new strategies of superannuation funds, such as the drive towards exchange traded funds and overseas equities.

“Superannuation funds have been increasing their allocation to exchange-traded funds as they are easy to invest in,” Dr Waring said.

“This has facilitated greater diversification including towards overseas technology indexes and higher-growth investment opportunities en masse which has benefited members.

“However this is having a negative impact on Australian small cap shares not in the ETF indices, which are losing billions of dollars of potential investment to large cap and overseas companies. The trend of mergers between more superannuation funds will deepen this impact.”

Dr Waring said the use of exchange traded funds was undermining the establishment and growth of early-stage startups and would ultimately harm Australia’s economic future.

Superannuation funds should diversify more into small cap fund managers and venture capital managers to finance domestic growth industries as well as increase benefits to their members.

“Less investment into smaller, younger Australian companies will have the corollary effect of harming the future development of our economy and the provision of new employment opportunities,” Dr Waring said.

“It ignores the higher returns selected venture capital managers could bring to the superannuation industry.

“Superannuation funds could be earning more through longer-term venture capital investment than compared with today’s short term public equity markets.

“This is particularly the case for industry-focused superannuation and specialised venture capital funds which are committed to the same vision – creating a better future for their industries and their members.”

About Stoic Venture Capital

Stoic Venture Capital provides financing for early-stage companies, particularly those arising from university research. We are unconditionally registered as an Early Stage Venture Capital Limited Partnership (ESVCLP). We take a collaborative approach to investing in the highest potential companies. www.stoicvc.com.au

ends

THE Parliamentary Joint Committee on Intelligence and Security (PJCIS) has received a letter from the Minister for Home Affairs agreeing to its suggested Terms of Reference for an inquiry into national security risks affecting the Australian higher education and research sector with a requested reporting date of July 2021.

The Parliamentary Joint Committee on Intelligence and Security (the Committee) will inquire into and report on National security risks affecting the Australian higher education and research sector.

In considering national security risks to the sector, the Committee specifically seeks information on:

1. The prevalence, characteristics and significance of foreign interference, undisclosed foreign influence, data theft and espionage, and associated risks to Australia’s national security;
2. The sector’s awareness of foreign interference, undisclosed foreign influence, data theft and espionage, and its capacity to identify and respond to these threats;
3. The adequacy and effectiveness of  Australian Government policies and programs in identifying and responding to foreign interference, undisclosed foreign influence, data theft and espionage in the sector;
4. Responses to this issue in other countries and their relevance to the Australian situation; and
5. Any other related matter.

A full terms of reference are available online here

Chair Andrew Hastie MP, said, “We are going to examine the question of foreign interference in the Australian higher education and research sector. The committee will engage with a wide variety of stakeholders in this sector as well as appropriate national security agencies.”

Submissions are requested by 4pm, Friday December 18, 2020. Further information about making a submission to a parliamentary committee inquiry is available here. 

A dedicated email address has been created for this inquiry, all email correspondence including submissions should be sent to This email address is being protected from spambots. You need JavaScript enabled to view it.

Further information about making a submission to a committee inquiry can be found at the following link.

ends