John Murphy (Lowe, Australian Labor Party, Shadow Parliamentary Secretary to the Leader of the Opposition) Share this | Link to this | Hansard source

by leave—I move opposition amendments (1) and (2) together:

(1)

Schedule 1, item 4, page 4 (line 6), omit “small business”, substitute “eligible business”.

(2)

Schedule 1, page 3 (line 2) to page 15 (line 28), omit “small business”, wherever occurring, substitute “eligible business”.

There is no question, in my view, that this bill requires amendment. There is a threshold question that the minister must answer immediately, and that is: how will the government ensure that the system will work this time, given the monumental failures last time? It is time to stop paying lip-service to the needs of rural communities by accepting the failures of the past and giving assurances that those failures will not be repeated.

The government made an earlier attempt to assist small businesses affected by drought through the Small Business Interest Rate Relief program. The Australian National Audit Office 2004-05 performance audit into drought assistance noted that 17,500 applications would be received and 14,000 would be successful. That was when the Howard government extended to small businesses a definition where, I believe, 70 per cent of the income of the business was derived from agricultural activity. So today I ask the minister: does he know how many applications were actually received? I ask the parliamentary secretary responsible for the carriage of this bill in the chamber now: does she know how many applications were actually received? At a time when the Howard government was expressing the sincere belief that 17,500 applications would be received, only 450 actually were.

Dick Adams (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

How many got approved?

John Murphy (Lowe, Australian Labor Party, Shadow Parliamentary Secretary to the Leader of the Opposition) Share this | Link to this | Hansard source

Of those applications an appalling 182 applications were successful.

Dick Adams (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

How many?

John Murphy (Lowe, Australian Labor Party, Shadow Parliamentary Secretary to the Leader of the Opposition) Share this | Link to this | Hansard source

One hundred and eighty-two, for the benefit of the member for Lyons, who has an abiding interest in this bill. Not only was the Howard government way off the mark in terms of the reach of this policy, the applications process was so difficult that many in rural communities that are already doing it tough either gave up or did not know the scheme was there. So I ask again, and it is a legitimate question to put to the minister and the parliamentary secretary: how is the minister going to ensure that the system will work this time, given the abject failures last time? How did the Howard government get it so wrong? How could the farmers’ party, the National Party, stand by and allow this to happen?

These questions must be answered and they must be answered today. People wish to know where the minister’s evidence is that he has fixed the problem of those applications. Where is the evidence that this legislation will actually hit the mark? How has the minister addressed the definitional problems involved in the application process, including proving that 70 per cent of income derives from the farm business? What is ‘farm business’? These are definitional issues this bill has not addressed. These are issues the minister has not addressed, and I am asking the parliamentary secretary if she can address those today. The government must ensure that the application process for any assistance is uncomplicated and not tied up in red tape, to ensure that those eligible for assistance actually apply for assistance. Drought affected businesses deserve to receive a better go with drought relief than the Howard government provided last time around. I conclude where I began and I ask the minister and the parliamentary secretary to tell the House today how the government will ensure that the system will work this time, given the monumental and appalling failures last time.

Sussan Ley (Farrer, Liberal Party, Parliamentary Secretary to the Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

I do not really understand the amendments that have been moved by the member for Lowe and, I think, on behalf of the member for Hotham. I want to respond in the best way I can, which is to say that it seems to me from looking at the amendments that they are a matter of terminology which will not go to the intent or the design of the bill. The member for Lingiari seemed to suggest while I was making my summing-up speech that this was not about government helping the little guy but the big guy. Maybe I have misunderstood that, but in any case all those comments I do not accept.

I want to reiterate that this bill is about the household support available to eligible businesses that are not farmers in rural Australia. It is obviously a good thing to bring everything into the discussion, but the interest rates support that you are entitled to receive is not the subject of this bill. I think the member for Hotham made the comment in his earlier speech that if you have a business of 100 employees it is silly to suggest that you would be accessing Centrelink household support. I probably agree, but you are obviously eligible to apply. It is unlikely you would receive it as you would have significant resources of your own to rely on, but what you could access is the interest rates subsidy. Of course this is not what the bill is about but it does exist and it is part of the whole package of help available to small businesses in rural Australia.

By lifting the bar to 100 employees we are giving small businesses the option to apply for the interest rates subsidy, which I believe is what will probably matter the most to them. The member for Mallee brought a good example to the House when he talked about a machinery dealer who might have operations in several rural towns. They are a small business for all intents and purposes in the town that they are in, but let us not get hung up on the terminology. They are local, they are struggling, and they deal with farmers. If they added up the total number of employees across all of the small towns I am sure they are in in the Mallee electorate, they would probably have more than 100 employees. I certainly do not want to be part of a government that says that we are not helping them because of an aggregation that exceeds a certain number. Perhaps when the opposition understands that that is what we mean by having a limit of 100 employees they will not be so vigorous in proposing the amendments that they have. Again, I urge people on both sides of the House to support this bill.

Warren Snowdon (Lingiari, Australian Labor Party, Shadow Parliamentary Secretary for Northern Australia and Indigenous Affairs) Share this | Link to this | Hansard source

Let me make it very clear to the parliamentary secretary: we are not opposing the bill; that is not what is being suggested here. I do think that there is an issue about definitions. You said when referring to small businesses that the term just did not matter, that it was not important. So therefore you should have no difficulty accepting the amendments put by the opposition. It is very clear to us that whatever definition you use for small business, a small business is not one which has 100 people in it. The ABS defines a small business as one which employs five to 19 individuals. Now we have got a definition which tells us that a small business is one which employs up to 100 people. Frankly, I am not quite sure where that is coming from. There is no question about accepting the interest rates support that you have referred to and the household support, but tell me what household has 100 people in it. What is going on here?

Let us get it very clear: we are concerned about making sure that the drought relief, the support, is given to those people who most need it. We are concerned to ensure that the application process is not impeded by bureaucratic processes which prevent people getting access to the support that they require—and that is why we have been critical of the past performance. It was estimated that there would be 17½ thousand applications in the previous scheme and that 14,000 would be successful. We hear that 452 applications were received and only 182 were successful. What was behind all that? How could you make such a wrong assumption?

What are the assumptions that you have put into this current bill? How many people do you estimate, in the current arrangements, will apply? You have already said that since, I think, the end of last year there have been 280 applications and 69 per cent of them have been successful. How many applications do you estimate you will receive between now and the end of the program in 2008, when it is due to expire, and how many do you think will be successful? And what are the reasons that applications are not successful? What advice can we now give to the Australian community about how they can be successful? What are the things that impede people from accessing this assistance? We need to know that and it is important that the people who live on the land know that.

Those people who are affected by drought should have absolute confidence that when they make an application, in the way that is being proposed by the government, they will not be in the 31 per cent who will not be successful. They should be able to enter that process knowing that in all probability—not with certainty but in all probability—they will be successful. And if they are not being successful then it should be up to the government to publicise very openly the reasons, not why individuals are not successful but what the causes are for people not being successful. When we know that, we can then address the issues, and it might also explain the previous abysmal performance. Not only was the application process a problem, and there were obviously definitional issues which have been referred to by the member for Lowe, but clearly there have been other reasons why people were not successful. We the parliament, the Australian community, need to know those reasons so we can tell those people who are so badly affected by drought currently and into the future that they can have confidence when making applications to get the relief they so badly require. They need to have confidence when they make an application that they will not be frustrated at the end of the day because they have not been successful; they need to have every chance of being successful. I think that is something the government ought to put to rest today—and you have got the opportunity to do it now.

Sussan Ley (Farrer, Liberal Party, Parliamentary Secretary to the Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

I do not want to hold up the business of the House; I will be as quick as possible and I think I will have covered all the ground that I can. The opposition does not seem to understand that this is not an extension of a previous measure. This is a different measure. Quite simply, it will work because it is a tried and true method that is currently operating for farmers, and I gave the figures of assistance that the government has given to farmers under exceptional circumstances in my earlier summing-up. There is no connection with the previous measure. As a local member I felt, when that measure was there, that perhaps we could have achieved more with it. But that is not the measure that is being discussed before the House today, so there is no point in making comparisons.

The member for Lingiari asked how many businesses we estimate will be eligible. I can let him know that the figure we estimate is 5,440. I am not hung up on estimates about how many people might be eligible. I am confident that, with the figures I made available before, of who has already been helped, that is actually quite significant. The program has only been open since November last year and we are still in the stage with rural financial counselling services of promulgating it and making small businesses aware of it. What we are saying and what Centrelink is saying with its drought bus and all of the information it is trying to get into rural communities is: ‘Don’t sit at home and try and work out whether you might be entitled to assistance. Come forward.’ I think a 69 per cent success rate is a good success rate under any terms, but the people who are not successful are those who clearly do not meet the guidelines.

The member for Lingiari was again being critical and being picky about a definition of what is and is not a small business and whether 100 employees under an ABS description is small or medium. That does not matter to me in the administration of programs that help farmers. What matters to me is that farmers who are eligible under the guidelines that we have carefully put in place come forward and get help. We are not saying that if you have a business with 100 employees and doing very nicely you will get help because, hey, we have got a line there that says if you have got 100 employees you are entitled to help. You also have to pass significant income and assets tests, like any farmer, and if you do not pass those tests then you do not get any help. So can I say to the opposition: I do not really understand the philosophy behind your amendment and it is fairly meaningless in the context of this government providing assistance for drought relief because, as you have pretty well admitted yourselves, it will actually make no difference to how the measure you have already undertaken to support is rolled out in rural communities. I thank the House.

Kirsten Livermore (Capricornia, Australian Labor Party, Shadow Parliamentary Secretary for Education) Share this | Link to this | Hansard source

I am rising in support of the amendments moved by the member for Lowe on behalf of our shadow minister for regional development. Just to make it clear: the point of the amendments is to support the threshold. We have no problem with the threshold for eligibility for this program being for businesses with up to 100 employees, but we do not accept the definition that a business with 100 employees is a small business. We say the threshold is fine, let us have it up to 100 people, but the amendments change it from being called a small business because we just do not accept that that is a small business. We ask that it be called an ‘eligible business’ and for that terminology to be used throughout the bill. That is more realistic because a business with 100 employees is not a small business. It is not the definition accepted by the Australian Bureau of Statistics, and we do not accept that definition either. So we have no problem with the threshold—let us make it open to all those businesses with up to 100 employees; but let us not continue this artificial political construct that that is in fact a small business.

In considering the amendment, we also ask that the government looks seriously at the concerns Labor has raised with the way drought assistance has failed to reach those who needed it in the past. As we have heard, the stated aim of this bill is to extend exceptional circumstances assistance to agriculturally dependent businesses that have been adversely affected by the drought. Of course we all support that aim. In this debate we have heard the stories from around Australia about the impact that this drought is having on our communities and on the families who are affected. Whether it is the worst drought in 1,000 years or the worst drought in 100 years, we know this is having a devastating effect on people around the country. Forty-four per cent of the nation is declared to be in exceptional circumstances and that is leading to the call on the government to support the families and businesses affected.

One thing that really struck me—it was actually quite moving—was when the member for Mallee was speaking about the experiences he has had in his electorate. He talked about the difficulty faced by farmers and businesspeople when they request this assistance. He said that it is quite difficult for people to reach that point and to go to a financial counsellor, Centrelink, a local member or whomever it might be and to say: ‘I just can’t do this any more. I do need to apply for this support.’ When you hear those stories, you realise the responsibility that we have in this place not to make it any harder for those people than it already is. Our concern on this side of the chamber, having seen the rollout of earlier programs, is that perhaps the government has been making it harder than it necessarily has to be for people.

That is our challenge to the government, our challenge today to the parliamentary secretary who is taking this bill through. Can you guarantee that this bill will deliver to the small businesses in drought affected areas? As we have heard, we regard this as a very legitimate question to ask based on the government’s past record because we have been in this position before. The government has made an earlier attempt to assist small businesses affected by drought through the Small Business Interest Rate Relief program.

We have heard it from quite a few speakers on this side, but I think it is still worth repeating because the figures are just so stark in demonstrating the failures of earlier programs. The Australian National Audit Office really shone a light on this in its performance audit in 2004-05 into the drought assistance programs. Those figures issue a challenge to the government to make sure that it is getting this right. The estimate was that there would be 17½ thousand applications received for drought assistance. In fact, only 452 applications were received and only 182 were successful. We are asking, what went wrong last time? Where are the guarantees this time? Where is the evidence that this government has now got it right?

I note the parliamentary secretary’s assurances in her summing-up that the government has been out listening to small businesses in these communities. You obviously had good intentions when you designed the earlier programs—but when they were so poorly targeted and the take-up rate was so low we really have to ask: has the government got it right this time? We have to do more than wring our hands and issue good intentions; we have to get it right for those drought affected communities. (Time expired)

Dick Adams (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

My colleague has just pointed out the difference that we have and why we have moved this amendment. It would certainly make a difference if instead of calling it ‘small business’ you called it ‘eligible business’. We would not have a problem if the definition of ‘eligible’ was a business that was having difficulties under the criteria, and if it could meet the criteria it could go on. There is some sort of reason that the government wants to use the term ‘small business’, but it needs to take it away from a definition. We would look at the Australian Bureau of Statistics’ terminology in that area. It states that small business is five to 19 employees who are involved in that business, not 100 as the bill puts forward.

The opposition has great concern that the last time the government tried to do something on this it failed dismally. The audit shows that. It is a shame that those in the National Party—the honourable member for Parkes, the half minister, is sitting at the table; he used to work for the farmers union but he has not been out there screaming and hollering to get this rectified—have let it go through to the keeper without really getting on board and making something happen even earlier than this. That is why we are concerned. It failed dismally. The government failed to put in place something that was going to achieve its goals. It estimated that there would be 17,000 applications, but 452 applied and 182 were able to be assisted.

There were a lot of people who suffered and a lot of people who did not get what the government said they were going to give them. That is what occurred. People suffered and probably lost their businesses. Their businesses probably do not exist now because of this. But they could probably have come back into play in better times if they had had some assistance. So from all the huff and bluff, all the rhetoric about how brilliant the government are at looking after regional Australia, they did not do it—they failed miserably.

We have moved that amendment in good faith. I would have thought that the government could have given it some consideration. I take what the parliamentary secretary at the dispatch box has said and I wish her well on her tour to Tasmania. When the member for Hotham was the minister in this area there was national drought policy development and a Rural Adjustment Scheme, which allowed for the assistance of farmers in times of exceptional circumstances but it was not limited to drought—there are other exceptional circumstances.

Under exceptional circumstances criteria, it cannot have rained for a certain period. The point I was making about Tasmania is that, while it might rain there, the rain and the moisture content in the ground do not achieve anything. South Australia has a similar problem with these criteria, which were set up for New South Wales and Queensland not for the other states. We need to assess the criteria and have another look at them. That is what I am asking for, and I think we should do that as a country. Both major parties should be looking at this to assist people when they get into trouble.

Of course, the bigger issue that we should be dealing with is that drought is an ongoing phenomenon that is a part of our country and a part of our landscape. So we have to drought-proof ourselves and come up with ideas on crops that will grow with less water, and all those sorts of opportunities. There are exceptional times when we get there, but we have to be smarter than we have been in the past, when we just accepted drought as drought. There are a lot of other things we have to think about and we have to introduce intellectual rigour into this debate. Labor certainly did that in government, and I think we did it a lot better than this government. I am disappointed that we have not been able to pick up our simple amendment, which I think would have made this a better bill in the long term. (Time expired)

Question negatived.

Bill agreed to.