Paul Fletcher (Bradfield, Liberal Party) Share this | Hansard source

The purpose of the Competition and Consumer Amendment Bill 2013 is—remarkably, under the present government—to reduce in a minor way the regulatory burden which applies to a small category of small businesses. You will appreciate the incredulity and, at the same time, the sense of relief with which we on this side respond to this unexpected, but nevertheless welcome, recognition by the government of the importance of reducing the regulatory burden wherever possible.

The particular effect of this bill is in relation to the restaurant and café businesses. Anybody who has ever been to a restaurant or café, and happily that is just about everybody, would recognise that these are very tough businesses to run. The hours are long and unsociable. When everybody else is relaxing and enjoying some convivial time with family and friends, you as the restaurant or café owner or proprietor or staff member, are hard at work. It is a very, very competitive business. New restaurants and cafes open all the time. Restaurants and cafes are all too frequently going out of business.

It is a business where the margins are very slim indeed. The pressures on people who run a hospitality business—a restaurant, a café or similar such businesses—are extraordinary. The standard of food, wine, catering, service, and hospitality that we in modern Australia have come to expect and take for granted from the restaurant industry, the café industry or the catering industry is truly extraordinary.

I want to take a moment before I turn to the substantive provisions of this bill to express my appreciation and admiration for the small business people who every day open their café or their restaurant and carry out another day's work in providing excellent service to their customers, in creating a convivial environment where people can, in the time-honoured phrase, eat, drink and be merry and in offering a standard of food and wine which no other nation can equal. I put it to you Madam Deputy Speaker that no other Australian ever has the experience of going to another country and saying, 'Gee, their food's a lot better than ours.' No Australian ever has that experience. No Australian ever has the experience of going to another country and saying, 'Gee, their food's fresher than ours, isn't it? Gee, the quality we're experiencing of this fruit and these vegetables is better than we are used to at home.'

The quality that we have in the restaurant and catering sector is absolutely extraordinary and we do not often enough take the time to acknowledge the excellence which has been achieved in that industry. Nor do we often enough stop as regulators, as lawmakers, to think about the many daily impediments, burdens and challenges which those operating restaurant and catering businesses face.

One of those challenges has been the operation of a very detailed provision of what used to be called the Trade Practices Act, which has now changed to the Competition and Consumer Act. A very detailed provision was added to that act in 2009 which made it more difficult for restaurant and café owners who were carrying out what was a fairly common practice in that industry, for perfectly good reason, to specify on their menus that a surcharge applied on particular days—weekends and public holidays. As a result of the amendments to the act which were made in 2009, introducing a so-called component pricing provision, it was made more difficult for restaurant and café owners to adopt this hitherto common practice in their industry.

It was no longer adequate under the changes that were made to the Trade Practices Act in 2009 for a restaurant or a cafe to have a menu which said, for example, that the beef burger cost $16 and then to put a note at the bottom of the menu saying that there was a 10 per cent surcharge on weekends and public holidays. That was no longer possible because to do so breached the component-pricing provisions in the Trade Practices Act.

Now, I do not doubt that the relevant officials who recommended this approach did not envisage that it would cause great difficulty. I do not doubt that they never took a moment to think through the practical implications for a small business person running a cafe or a restaurant and needing to deal with this in addition to customers; in addition to getting down to the markets early in the morning to buy produce; in addition to recruiting, hiring, training and retaining staff; in addition to coming up with menus that were attractive and met the needs of customers in a very competitive market; in addition to keeping their facilities clean, safe and compliant with all of the standards that properly apply in those areas; and in addition to keeping the accounts of their business, complying with their GST and business activity statement requirements and complying with their tax obligations. I do not doubt that it never occurred to the officials who recommended these provisions that this would be an additional, onerous burden on the small business people running restaurant catering operations.

I do not doubt that the officials who came up with this provision did so with good intentions, and that there was no malice in the fact that they simply failed to think through the practical day-to-day implications for a business owner in this very demanding and very competitive sector, with an extraordinary range of pressures. They failed to think through the practical implications of the component-pricing provisions, which required them to have now not one set of menus but two sets of menus: one set of menus showing that the beef burger was $16 during the week and another set showing that on the weekends it was, for example, $17.60.

But for the small business person running a restaurant or a cafe, very often with themselves as the only full-time staff member—perhaps a couple of part-time or casual employees or perhaps it is a family business with both husband and wife involved—the additional practical burden in these circumstances with the additional cost burden of producing and maintaining two sets of menus and two sets of printed menu boards in cases where restaurants have such boards outside, and all of the other complexities associated with that, represent an additional burden. Indeed, the Restaurant and Catering Industry Association of Australia has estimated these costs per restaurant at between $8,000 and $10,000. That is a nontrivial amount of money for a small business operating, as restaurants and cafes often do, on very narrow margins.

In its annual review of regulatory burdens on business, the Productivity Commission in 2010 recommended that the Australian government should amend the Trade Practices Act to have restaurant and cafe menu surcharges for specific days placed outside the scope of the component-pricing provisions of that legislation. And it would seem that a miracle occurred, because it is not unreasonable to suspect, based upon this government's track record and approach, that an annual review of regulatory burdens on business is a document that would not be closely read by ministers in this government. I venture to suggest that it is a document that upon receipt would immediately be filed by most such ministers in the circular filing cabinet.

On this occasion, extraordinarily, and for reasons which we will not speculate about, the government has chosen to accept this recommendation. An exposure draft of the amendment that we are now contemplating was released in December 2012, and there followed after that an extensive period of public consultation before we reached the point at which the requisite number of jurisdictions agreed to amend the competition law.

It has taken a long time, and it should not be like this. It should not be that small businesses can have such onerous regulatory burdens placed upon them which, when weighed up against the public benefit, are difficult to justify. Of course, if people are to be charged more on weekends or on a public holiday, they ought to be notified of that. Of course, it would be inappropriate if a restaurant had a price on the menu but then unilaterally charged people more without notifying them of that. That is not the question. The question is whether that desirable policy outcome is satisfactorily achieved by the previous standard industry practice of noting on the menu that there was a surcharge on weekends, or whether it required the more onerous, prescriptive, detailed, expensive, time-consuming, burdensome regulatory requirement of specifying the specific prices and requiring two duplicate sets of menus for one restaurant, for one business.

Happily, sanity has prevailed. On this side of the House, the coalition is pleased to welcome and support this brief outburst of sanity from this government. The coalition has a strong commitment to the reduction of unnecessary red tape which impinges on business activity, which harms economic activity and in turn harms employment and the economic prospects and conditions faced by all Australians. We have a government today which purportedly is committed to reducing regulation, but instead the reality is that we have seen an explosion of red tape: some 21,000 new or amended regulations introduced, only 1,100 repealed.

I want to make a point which is relevant to the bill before us. This is a point which the shadow minister for small business makes repeatedly, eloquently and passionately. The burden of compliance with regulation falls heavily on large business, but it falls even more heavily on small business. Large businesses can afford a legal department. They can afford a compliance department. From my own experience as a senior executive of a large corporation with a team of some 18 lawyers employed by the company discharging the many regulatory and compliance obligations that we faced, I know that while this is burdensome for big business, it is more feasible to deal with than is the case for small business. In a small business, there is no legal department, there is no compliance department. There is very typically just one struggling person trying to serve customers and make a profit while dealing with a forest of burdensome regulatory requirements and the ever-growing ingenuity and creativity of this government and its officials in dreaming up yet more regulatory requirements to impose on business.

In the bill before the House this afternoon we have seen an unlikely and unexpected outbreak of sanity. On this side of the House, we welcome it. We wish simply that it were not a one-off.

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