Julie Owens (Parramatta, Australian Labor Party, Shadow Parliamentary Secretary for Small Business) Share this | Hansard source

I have a question about the small-business portfolio in particular. I used to run a small business. I have been a consultant for many. I managed a trade association for quite a few years. One thing I absolutely learnt in all of that time is that the single thing that is most likely to guarantee your success is that your customers are feeling confident and spending. If you do not have customers, nothing else matters. The customers need to feel that they are spending. For many years now I have been watching the growing inequality and wondering when it was going to snap, when the fact that we were sucking money away from the customer base and feeding it into profit would start to hurt because there just would not be as many people spending in order to make people wealthy. Spend money and it flows and eventually ends up in profit if we do things well. So I was wondering when it would break. I know that in the last couple of years or so there have been many economists around the world, including in bastions of radical thought like the World Bank, saying exactly that—that the inequality that we are now seeing across the world is becoming a problem.

I have watched this government through the last budgets, and there are a couple of things that concern me. I want to ask the Minister for Small Business how he responds to this. I have heard businesses from time to time—some businesses—arguing that they want to cut the wages of their staff. That is not uniform, by the way. I have heard many people say they do not want to do that. But I have never heard a business argue to cut the wages of its customers. And yet that is what we see happening in this budget.

We have seen the key measures of jobs and growth downgraded. We have seen the Turnbull government expecting 100,000 fewer jobs in our economy than they were expecting just a year ago. We have record underemployment. We have fewer hours worked per Australian than ever before. We have higher rates of casualisation and insecure work. We lost 35,000 full-time jobs last year. We have record low wages growth and inequality at an all-time high. That looks to me like we are seeing smaller numbers of workers and workers not getting the kinds of pay rises which particularly those at the lower end would spend.

We also see cuts to household income in this budget. We see cuts to family payments. One million families will be worse off. A typical family on $75,000 will be $1,000 worse off. About 70,000 new mums and their families will be worse off due to cuts to parental leave. Abolishing the energy supplement for millions of pensioners is about a billion dollars that is sucked out of the local community. Seven hundred thousand people will lose their penalty rates of up to $77 a week, and some much more. And of course we have a tax hike through the Medicare levy, which will particularly impact on the lower paid.

These people—the people who are affected by the penalty rates cuts, the families on $75,000, new mums—traditionally are on lower incomes and spend their money. They spend all of it. If they are confident, they will spend at the local hairdresser or supermarket et cetera. So, if you take the money out of that, you are actually ripping the money out of the community from the group of people that is most likely to spend it locally. Then the fruit shop does not get that money, it does not pay its staff who then go on and spend it again et cetera. The multiplier is affected as well. It is absolutely pulling money out of the pockets of customers that small business depend on.

I would like to ask the small business minister—with all the talk about jobs and growth and with all the talk about support for small business—how he responds to an economy which is seeing the money that people spend in local small businesses being reduced seemingly every month and every year. It is a very serious issue. When you go out—as I am sure you do—and talk to local businesses, the first thing they will tell you is that things are pretty tough out there at the moment because customers are not spending. If you rip this amount of money out of their customer base, what impact does that have on small business?

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