Labor’s catastrophic stuff-up over tax law proves they are the amateur hour party. It’s just the tip of the iceberg, writes PETER VAN ONSELEN

The Albanese government seems to have finally recognised the errors in its poorly worded law requiring tax practitioners to disclose any mental health problems to their clients. 

Daily Mail Australia drew to its readers’ attention the alarming ramifications of the law weeks ago – but it was only in a meeting on Friday between the government and tax practitioners that there seems to have been a belated admission of such.

Labor’s assistant treasurer Stephen Jones had issued a ministerial directive requiring tax practitioners to disclose ‘any’ matter a client might consider relevant to whether or not they would engage their services.

Anyone with an ounce of common sense could see that ‘any’ matter is too broad for legally binding legislation and therefore needed tightening up.

The poor drafting was done to satisfy the Greens, who have been on a crusade since revelations of misconduct by a small number of tax practitioners within ‘big four’ accounting firm PwC.

The vague wording of the new laws opened a Pandora’s box of problems, including the potential that tax professionals would need to disclose mental health problems to clients.

That would be a horrendous breach of privacy as well as a reason tax professionals might avoid mental health support no matter how much it was required.

Suicide Prevention Australia, the nation’s peak body in this area, wrote to the minister expressing its concerns, and understandably so.

Assistant Treasurer Stephen Jones (pictured) has comprehensively stuffed up new laws designed to make the government appear tough in the wake of the PwC scandal

But for weeks Jones revealed his inner stubborn self, refusing to concede his badly worded law would force mental health disclosures.

Probably concerned about getting the Greens offside.

Jones kept insisting he didn’t intend the new law to be interpreted that way, so that was the end of the matter. As though he had the power of an overlord or emperor.

He seemed to think the wording of the law was not relevant if he – as the junior minister responsible – offered misguided musings to the contrary. 

Courts interpreting laws don’t care about what the minister says; they care about what the law says, in black and white. You don’t need a law degree to know that – it’s common sense, just not to the minister. 

Never mind also that the Chair of the Tax Practitioners Board (TPB), Peter de Cure, explicitly said mental health might need to be disclosed given the way the law was worded. The TPB is the government body applying the law on a case-by-case basis. 

And never mind that when Daily Mail Australia rang the TPB’s help line for tax agents we were told yes, mental health disclosures would be required under the new laws:

‘It falls into the typical grey area of the TPB’s wording. If [mental health] is affecting operations or working for the client it probably should be disclosed… It would be advised and it’s recommended.’ 

The confusion highlighted the ambiguity that was in need of fixing, which the government is now finally – reluctantly – doing. 

The emperor had no clothes but the Assistant Treasurer has finally accepted a barely there sheet to preserve some of his modesty.    

Assistant Treasurer Stephen Jones (pictured) had Silk’s advice in his possession that mental health might need to be disclosed under his new laws but he still claimed concerns were ‘unfounded’

Did any of this lead the minister to reflect on his policy stupidity in the first place? Sadly not. At least not until pressure was brought to bear by the media and the industry being affected.

Jones even continued his Monty Python-style Black Knight routine after receiving Silk’s advice that mental health was something that might need to be disclosed, unless the law was changed.

A Silk is a Senior legal Counsel – the highest-ranking barrister within the profession with many years of experience to go with their expert standing. This particular Silk was also the university medalist in law at ANU: Not exactly a junior burger whose legal advice should be discarded by a minister seemingly out of his depth.

Despite receiving such advice, Stephen Jones continued to describe claims that mental health would need disclosing as ‘unfounded’. 

Journalists such as Ed Tadros from the Australian Financial Review (AFR) parroted the false claim that the concerns were ‘unfounded’, even though, like the minister, he knew there was legal advice proving the concerns were, in fact, well-founded. 

Unfounded? The minister knew there was legal advice confirming the fears were well-founded and so did the journalist parroting the minister’s line (AFR article published on 28 August)

I’m not sure if I’m more critical of him replicating the spin of the minister or the ethics of describing something as ‘unfounded’ when he knew there was evidence to back up the concerns.

Lets call it a callow tie.

Tadros even tried to claim yesterday that leading mental health expert Patrick McGorry agreed the wording of the new law could require mental health disclosures.

However, when Daily Mail Australia contacted Professor McGorry he said he had not seen the law and Tadros had not even contacted him about the piece he wrote for Saturday.

‘Haven’t seen the draft law nor the AFR piece and nor have I been interviewed in relation to any story today.’ 

Tadros was forced to concede yesterday that Labor is now fixing the problem (you know, the ‘unfounded’ one): 

‘The government will amend the wording of proposed laws’, he wrote, seemingly unaware that ministerial directives can’t be ‘amended’. 

They need to either be forcibly removed via a disallowance motion in the Senate or withdrawn by the government. Or an entirely new directive needs to be issued, which is what Labor is now proposing. 

Also, these aren’t ‘proposed’ laws, as Tadros misunderstood. When directives are tabled in the Senate they are written into law. In this case, the start date has been delayed as the government works through this mess of its own making.   

AFR journalist Ed Tadros claimed mental health concerns were ‘unfounded’ echoing Labor’s spin before it backflipped. He knew there was legal advice substantiating the concerns

While Labor has done an about-face to fix the mental health implications of its new laws, there are other problems that still need fixing, such as loose wording forcing tax professionals to dob in clients.    

We only know about these continuing problems with the new law because those who attended the consultation meeting on Friday refused to sign non-disclosure agreements. At one point, the government threatened to walk away from discussions if attendees would not do so.

It is the same anti-transparency action Labor tried to get away with when consulting the anti-gambling lobby, a move to silence them that Tim Costello called out in all its shameful ignominy just the other week.

To better understand how political spin doctors seek to avoid answering straight-up questions, just look at the below text message exchange I had with the most senior person in the Prime Minister’s media team, when I asked a very simple question about the Silk’s advice Jones had received but ignored:

Me: ‘The assistant treasurer Stephen Jones has said publicly that mental health disclosure concerns regarding his tax practitioners directive as tabled in the senate are “unfounded”; however, he made that claim publicly even AFTER being provided with silk’s (senior counsel) advice to the contrary. Do you consider such misleading conduct acceptable by one of your ministers? Doesn’t it fall outside of the standards imposed in the ministerial code of conduct? What will you do to address such bad behaviour by one of your ministers?’

Anthony Albanese’s spin doctor’s response: ‘From a spokesperson: The Assistant Treasurer has categorically ruled out any requirement for tax agents to disclose mental health, sexual orientation or religious views. The Government has actively engaged with the industry on the changes. The Minister wrote to industry peak bodies in July and August affirming his ongoing commitment to work with them to ensure the code works as intended. There is a meeting planned for this Friday to finalise any necessary changes to provide clarity and confidence that the code will work as intended.’

My text message to the Prime Minister’s Office asking some questions

The non-response by the PM’s chief spinner not answering the questions asked

My exasperated response to reasonable questions asked not being answered

In anyone’s language that response from the PM’s office doesn’t answer the questions asked. It’s just a word salad of spin aimed at avoiding the questions asked. Presumably because a direct answer would be utterly embarrassing.

Having been alerted to the fact Daily Mail Australia was onto the minister for deliberately misleading, in the wake of the legal advice he’d been made aware of, lo and behold a change of heart followed.

He finally backed down, albeit trying to disguise the shame of it as just part of the consultation process, cheered on by his media apologists. 

It fooled no one. 

To be clear, if a new ministerial directive is introduced to fix a previous one, that’s a backflip. Because it makes it abundantly clear the first one was poorly drafted with unintended consequences. 

Which is why the new one needs to be issued, to fix the mess already made.

Labor has now finally committed to doing that, at least so far as mental health disclosures are concerned. But there is plenty more wrong with Jones’ poorly drafted new laws in need of fixing.

For example rules requiring tax practitioners under investigation to make disclosures to their clients before any findings have been made against them. 

Daily Mail Australia understands Labor has still left this aspect of the law intact to satisfy the Greens, which has left tax practitioners deeply unhappy. 

Requiring accountants to disclose any investigation before findings are made, no matter how vexatious accusations of wrongdoing might turn out to be, is a very different process to how Labor set up its own federal parliamentary watchdog. 

That body can’t make investigations public until findings are made. So what is good for the politicians isn’t good for accountants, apparently. 

How does Labor justify such hypocrisy? 

For context, less than one in 10 investigations undertaken by the TPB results in adverse findings against tax practitioners. 

So if Labor doesn’t fix this issue it will require accountants and bookkeepers to tell all their clients they are under investigation even when 90 per cent of investigations ultimately clear them of any wrongdoing. 

The AFR in its reporting got this particular aspect of the law wrong too, claiming concerns that investigations would require disclosure were ‘disputed’. 

But the explanatory note to the new law Assistant Treasurer Stephen Jones put out specifically requires disclosure of ‘a current investigation by the board of a material breach’. 

If the AFR’s professional services editor had been more professional he would have realised that. It’s right there, in black and white, obvious for all to see. 

Inaccurate claims in the AFR that concerns over disclosure were ‘disputed’

The proof in black and white: The explanatory note for the new laws makes it clear that investigations are included for disclosure

The new laws even require accountants to dob in their clients – something lawyers and doctors aren’t required to do – destroying the client’s trust in the professional relationship they have with their tax agent. 

There is no sign the government will change this ticking time bomb either.    

I’ve watched all manner of poor public policy-making by politicians over the years, but the mismanagement of this issue takes the cake. 

Belligerence, stubbornness, false narratives and downright devious refusals to answer simple questions define how Labor has approached the issue.

Daily Mail Australia understands that the Friday meeting between the government and tax practitioners was littered with implied threats by the minister’s team, despite the minister’s office claiming afterwards just how constructive it was.

Stephen Jones, as the responsible minister, was supposed to attend that meeting. But, in the end, he didn’t even bother to show up, only sending his political staffers instead.

Such disinterest neatly sums up why he has mismanaged the whole issue so badly. 

This is a story of government failure in but one particular policy area. However, when you talk to people across business and industry, you hear similar stories of incompetence.

No wonder the polls have tightened as the election looms large. If this wasn’t a first-term government, its chances of re-election would be slender.