Fiona Scott (Lindsay, Liberal Party) Share this | Hansard source

I am pleased to rise today in support of the Export Market Development Grants Amendment 2014 introduced by the Minister for Trade and Investment this morning. This amendment delivers on the coalition's pre-election commitment to not only progressively restore funding to the Export Market Development Grants scheme but to also provide an initial $50 million boost. Of course as other speakers have noted, the previous Labor government cut these grants by $25 million per year, resulting in a disastrous effect on small and medium export business across our great nation. For Australia to maintain our international competitiveness, it is essential we find, nurture and support our innovative entrepreneurs, in turn enhancing the nation's export base across agriculture, services and manufacturing, the three economic pillars essential to the future employment of workers across Australia and crucial to the economic viability of the people in Western Sydney who look to such sectors for their future job security. Unfortunately, cuts by the former Rudd-Gillard-Rudd governments say much about their lack of understanding in regard to Australia's small and medium businesses. They are clear examples of the misalignment of Labor's priorities and demonstrate their interest in meeting a target rather than supporting these important sectors.

We often hear that small business is the engine room of the Australian economy. In the private sector in Australia, small business employs some 43.3 per cent of workers, and I would like to remind the House that all businesses were once small. In order to secure the economic sustainability of our nation, the Australian economy must diversify. We must find new trade opportunities and ensure our place in new and emerging markets. This scheme works to do just that, thus enhancing Australia's manufacturing, services and agricultural export base. This is the primary goal of the EMDG Scheme and why I rise today to speak in support of this bill. As such, I welcome this $50 million increase to this important scheme.

The Export Market Development Grants Scheme helps potential small and medium Australian exporters develop their export markets to become sustainable exporters by reimbursing up to 50 per cent of eligible marketing expenditure. As someone who had a marketing background before entering this place, I applaud the investment in marketing, because marketing is where we find the potential markets that will buy our goods and services. If we are not proactively looking to find new customers for our goods and services, we do not make products that will find a place overseas.

The scheme is a key Australian government financial assistance program for aspiring and current exporters. Administered by Austrade, the scheme supports a wide range of industry sectors and products, including inbound tourism and the export of intellectual property outside Australia. This legislation gives effect to changes which will make the scheme more accessible to businesses looking to export, and, therefore, I anticipate that the sector will grow in leaps and bounds.

In addition to the increase of $50 million in funding, this amendment also proposes three changes to the way the scheme will be administered. It will increase the number of grants available to be received by an applicant from seven to eight. As a result of this change, it is estimated that an additional 138 exporters will be able to claim an additional allowance each year. This will allow more experienced exporters to claim an additional grant and will allow previously successful recipients to further develop their goods and services in existing markets, re-enter markets that are now commercially viable due to the reduced exchange rate and diversify into new and emerging markets.

This amendment will reduce the minimum expenses threshold required to be incurred by an applicant by $20,000 to $15,000. This will benefit an additional 143 exporters who are projected to be able to make a new claim each year. Essentially, reducing the minimum expenses threshold decreases the marketing budget small exporters are required to invest in their export marketing programs before they can claim an export marketing development grant. This in particular is expected to be well received by the small- and medium-enterprise community as well as industry associations. Finally, it will reduce the current $5,000 deduction from the applicant's provisional grant to $2,500, resulting in all grant recipients receiving an additional $2½ thousand per grant.

In the current difficult international trading conditions, exporters have faced several years of pressure on their marketing budgets from higher exchange rates and weak international markets. The ability to have even a modest increase in marketing funds is expected to be welcomed. This increase in grant funding will be particularly relevant now that many small and medium enterprises are increasingly eyeing their potential for increased international sales as exchange rates ease and international markets increasingly recover.

These three administrative changes are excellent news for Australian small- and medium-sized businesses who want to continue to be competitive and innovative—they want to find the products for tomorrow; find the new iPhones and the new iPads and find the new automotive technology—such as those I see in my electorate.

Before I move on to talk about my electorate and how I see these grants working locally, I would like to draw the attention of the House to the interesting comments made by the members for Sydney and Oxley. There was a pre-election assertion that Labor's proposed bill, which would have decreased grants for exporters in developed markets such as Europe and the USA and would have focused more on development, was a sign that they were recognising the importance of Asia and other exporters. I quote the speech by the honourable member for Sydney where she asserted these claims and then went on to say:

The Labor amendment bill introduced in the last parliament sought to realign the Export Market Development Grants Scheme to support small businesses exporting to East Asian and frontier and emerging markets. It is disappointing to see that the Abbott government has walked away from these proposed changes. I certainly believe that it must be possible to find a way to leverage this public investment to further the nation's strategic objective of a much deeper engagement with our region. Not only has the realignment of the scheme …

The important point to recognise is that small and medium enterprises who export are participating in global supply chains. Exporting to Europe and to the USA may well be of ultimate benefit to end-markets in Asia or in developing markets—for example, exports of fine wool to Italy end up in suits created and sold in Shanghai—so I do not think the opposition have much form in this space. Then we had the member for Rankin say that Labor got rid of red tape to help small business. I would like to remind the House that it was the previous Rudd-Gillard-Rudd government that provided 21,000 new regulations. So I look forward to our first repeal day when we will start rolling back the red tape that has been inflicted on the Australian economy by those opposite.

I move to my electorate of Lindsay. I can appreciate that from a helicopter view these changes may be viewed as technical or as only beneficial to large Australian exporters, which is just simply not true. This is why I am so pleased to note the previous recipients in my electorate of Lindsay, who have used these grants as an opportunity to increase their market share internationally. I am also happy to note that these companies welcomed the coalition government's additional support in this important area of their business. For starters, Concept Paints in St Marys is a business that I know quite well. Not only did my own family's small business get involved with its technology—it is a wonderful technology—but I have also visited its manufacturing plant in St Marys.

This is a medium sized business. It employs a lot of local people out of Western Sydney. It needs to be conscious of how it spends its money. It needs to be thrifty. It needs to weigh up the risks and the opportunities. To export a product overseas is not simply a matter of one or two meetings but rather, as Concept Paints describes it, it is a two-year pipeline of regular meetings, supplying and shipping of samples as well as contracting technicians to support the sale of the product. Because its product is new and innovative, it has to do a lot of work in marketing to explain to emerging markets how its product will improve productivity for people overseas.

It is quite a long process, and any type of process like this comes with costs. The primary competitors for Concept Paints are multinational companies, who have far bigger budgets that can be used to drive sales. Under the Export Market Development Grants scheme, Concept Paints will continue to be competitive. The grants will enable the company to push and promote its products into foreign markets and increase its global footprint, which is great news for Concept Paints and is a real success story about how these grants boost manufacturing, boost Australian products and boost the industry as a whole. Good news for the automotive industry!

GPC Electronics, located on Blaikie Road in Penrith, has also benefited from the Export Market Development Grants scheme. In the previous financial year, it received $150,000 under the scheme. For more than 20 years, GPC Electronics has successfully manufactured complex electronic equipment for leading global organisations, such as Toshiba, Nortel, Alcatel, Siemens and NEC. It is now one of the largest contract manufacturers in Australia, exporting to over 40 countries.

The list goes on: Packwest, in Jamisontown, is yet another local recipient. It is located in my electorate and it has received $10,495 under the export market development scheme. This is a fabulous local organisation that has strong ties with customers and suppliers to develop innovative packaging, products and solutions. There are so many other businesses that have benefited. Australian Natural Health, based in Emu Plains, specialises in pharmaceutical and toiletry goods. It is a wholesale company that has received $19,706. Epitomy Pty Ltd is an electronic equipment manufacturing company, based in St Marys, that received $10,689. Oz Trails, a tourism business, and Sydney Executive Tours, a fantastic travel and tourism company based in Penrith, received $30,000 from the scheme. Spiller Industrial Supplies, located on Batt Street Penrith, is a sole export distributor for Apollo Cleaning Systems. This year, they will receive $15,534. Finally, Sud-Chemie Australia is a fantastic international company which has its Australian offices based, once again, in Penrith. In the previous financial year, it received $18,137 in grants.

The reason that these grants are so important to areas like Western Sydney is that two-thirds of my workforce have to commute every single day for jobs. Grants like these create local jobs, help my local community and are the reason that I stand here today to fight for the people of Western Sydney. I appreciate that this money was administered under the previous government, but I encourage the House to consider how much longer this list will be with the administrative and financial boost introduced by the coalition government today. I encourage the House to consider how much stronger our small and medium sized business export markets will be under these changes. Let us not forget it was the Labor government who continued to make cuts in this important sector, who continued to cut the Export Market Development Grants scheme, who continued to cut into the opportunities that we as a government provide to this vital sector.

I am proud to be part of a government who seeks to support this sector and to continue to give small and medium sized enterprises a hand up. We want to make Australia one of the best places to start and grow a business. We want to be a smart economy. We want smart jobs. We want our local manufacturing, agricultural and service businesses to be exporting internationally. Small business and medium business are the engine room of our economy, and it is time we supported them. They need to be unshackled by this reckless opposition, who in government did all they could to burden them with regulation and more taxation. I commend this bill to the House.

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