A number of academics, including myself, made a submission to the Data Commissioner’s Data Sharing and Release Legislative Reforms Discussion Paper in late 2019. One aim of the work being done by the Commissioner is to modernise how the government shares its data in order to support development of good policy and programs and well directed law reforms.
Of relevance to the academics was an aim to ‘provide greater access to data for accredited researchers, scientists and innovators’, in particular to ASIC’s corporate database.
The background is that insolvency academics have for many years been critical of the lack of even basic data in relation to how the insolvency system works in Australia and the difficulty and cost in extracting existing data, in particular from ASIC’s corporate databases. More comprehensive collection of data, and access to it, has been developed over the years by AFSA in personal insolvency.
The academics’ submission listed Australia’s lack of attention to recommendations made to government over several decades.
A. The 1988 Harmer Report said that ‘one of the major handicaps that has impeded the Commission in this Reference has been the difficulty in obtaining pertinent statistical information about corporate insolvency in a readily available and intelligible form’.
B. In 1992, the then Trade Practices Commission said its study of insolvency had been hampered by difficulty in obtaining detailed relevant statistics on insolvency …. Much of the relevant data sought from the relevant authorities and the IPAA [now ARITA] simply have not been available.
C. Sixteen years later, the 2004 ‘stocktake’ report of a Parliamentary Joint Committee commented that it had ‘only the bare minimum of information on the operation of our various corporate administrations’, and it listed needed data on phoenix activity, assetless companies, ‘strategic insolvencies’, insolvent trading, unpaid employee entitlements and fraud.
The government response was simply that these were matters for ASIC.
D. Six years later, a 2010 Senate Report recommended the creation of the Australian Insolvency Practitioners Authority (AIPA) one role of which would have been to gather and report insolvency statistics.
The government rejected that proposal.
E. At the invitation of the Economics References Committee in its 2014 inquiry into the performance of ASIC, a submission on the need for better corporate insolvency statistics was made by a number of insolvency academics. There was no reference to that submission or the issue itself in the final report of June 2014.
If it had been the government probably would have rejected it.
The academics’ submission says that ‘while academic and professional research and input into insolvency law reform is of high quality, it lacks empirical data both as to be able to assess the need for a particular law and as to the effectiveness of that law once introduced’.
The statutory assessment of the 2017 safe harbour reforms may well be limited for this reason.
The Commissioner’s office advises that it will consult again on an exposure draft of the legislation in early 2020 with a view to the Bill being introduced to Parliament in mid-2020.
At the same time, it is working with government agencies to develop effective systems to streamline requests for data and ensure data is shared.
‘Siloed approaches, rigid hierarchies…’ and data sharing?
Given the recent 2019 Thodey review of the Australian public service, which found that it was relevantly hindered by
‘siloed approaches, rigid hierarchies, and traditional ways of working [which] have created barriers to providing joined-up services and integrated policy advice, and to sharing data, information and resources to best delivering government priorities across agencies’,
the outcomes of all this will require more than legislation and training.
At the same time, the insolvency industry itself, which possesses the core data, appears to suffer similar problems, its evident lack of contribution to insolvency statistics over the years being an indication.
The views here are mine and not those of my co-signatory academic colleagues.