A regulation that is costing equipment-hire firms millions of dollars a year in compliance is at the top of the government's red-tape hit list — with Skyreach featured in The Australian's exclusive report.
Originally published in The Australian by Sid Maher, National Affairs Editor. Skyreach general manager Geoff Giddings was featured in the report.
A regulation that is costing equipment-hire firms millions of dollars a year in compliance is at the top of Tony Abbott’s $1 billion red-tape hit list, part of which will be revealed this week.
The regulation under the Personal Property and Securities Act had been designed to protect hire firms. But in reality it effectively meant that hire firms that failed to register some hire agreements on a national register run by the federal government ran the risk of losing the equipment if their client entered into liquidation.
Parliamentary secretary to the Prime Minister Josh Frydenberg, who is driving the deregulation push, said the regulation was having a detrimental impact on the hire firms and costing the industry millions a year in registration fees and compliance costs.
The personal property security register was introduced in 2009 by the Rudd government and some firms had three staff working full-time on red-tape compliance, he said.
The scrapping of the regulation will be put before parliament on Wednesday along with 9000 other changes as part of the government’s red-tape reduction plan.
The government believes it will “surprise on the upside” on its pledge to cut $1bn a year from red-tape compliance costs.
Other laws to go include rules requiring separate classification applications for 3D and 2D versions of films including Kung Fu Panda, Avatar and Frozen.
The Prime Minister said childcare centres were subject to 1280 pages of law, 345 pages of regulation and 1149 pages of guidelines. “Inevitably the result is fewer services and higher fees for parents,” he said. “Local cafes that serve alcohol and have outdoor seating must negotiate a total of 75 sets of local, state and national regulations. Again, the costs are passed on to you.”
Mr Frydenberg told The Australian the impact on hire firms of the PPSA regulation was explained to him at a forum organised by the Liberal MP for Longman, Wyatt Roy, who said the measure imposed a “big administrative cost on small businesses”.
Geoff Giddings, the general manager of hire firm Skyreach, said the requirement to place equipment hires of “serial-numbered goods”, mostly motor vehicles, on the national personal property register was costing his firm $9000 a month and tied up two full-time staff.
“We’ll be able to put them to more productive work after the repeal goes through,” he said.
Under the repeal to be put before parliament, hire agreements of more than 90 days will no longer be required to be put on the register. Instead, one rule will apply to leases of more than a year to be put on the register.
The regulation will also change the definition of what constitutes a motor vehicle.
The chief executive of the Hire and Rental Industry Association, Phil Newbury, said “anything more powerful than a hairdryer” was classified as a motor vehicle under the existing rules.
For example, vibrating plates used in roadworks, scissor lifts, concrete mixers and generators attached to trailers were all currently considered motor vehicles.
The definition will be changed to define a motor vehicle as anything capable of travelling at a speed of at least 10km/h that also had motors with total power greater than 200 watts.
Ian Rodgers, who owns R&R hire at Caboolture, north of Brisbane, said the regulation had been designed to protect hire operators but had the “ludicrous” effect of creating a loophole that could allow liquidators to sell the equipment if the client firm that had borrowed it collapsed.
