Matt Williams (Hindmarsh, Liberal Party) Share this | Link to this | Hansard source

I move:

That the House:

(1) acknowledges small business as a major driver of economic growth in Australia;

(2) notes that:

(a) small businesses are time and resource poor and face significant obstacles in securing government contracts;

(b) the government has allocated $2.8 million over four years to assist small business to access the Commonwealth procurement market;

(c) the establishment of a new unit providing specialist advice on contracts will ensure small businesses are not disadvantaged when dealing with the Commonwealth; and

(d) under Labor, 519,000 jobs were lost in small business;

(3) commends the government for removing the regulatory imposts that apply to more than 20,000 annual tender processes for Commonwealth agency work; and

(4) recognises the benefits that will be achieved for small business in being able to competitively compete for Commonwealth tenders.

Don Randall (Canning, Liberal Party) Share this | Link to this | Hansard source

Is the motion seconded?

Michael Sukkar (Deakin, Liberal Party) Share this | Link to this | Hansard source

I second the motion and reserve my right to speak.

Matt Williams (Hindmarsh, Liberal Party) Share this | Link to this | Hansard source

Small business is the heartbeat of the economy. That is a phrase that gets bandied about a fair bit, but it is so true and we will say more about that today. My first real contact with small business came when I helped my mother in her shop in country South Australia as a young boy. As with many small businesses, this is a family business where the family members pitch in, and it is in a tight-knit community where everyone makes a significant contribution to the local business. I earned some pocket money along the way, which was always useful. My wife also is a small business owner, so I hear daily of the challenges that she faces in her business, with increasing costs and pressures and also those of other businesses around her workplace.

The coalition, however, has a strong record of working with small businesses, and members of the coalition know from our time in business—because we understand business and we can relate to small business—how to help small business. The small businesses out there and the employees of the small businesses know we are on their side. Over the last few years, I have talked to thousands of small business owners and workers about the challenges they face, and we are committed to making life better for them all. Unlike members opposite, we are not for big government; we are for effective government. I know these are the words that members opposite do not like to hear, but efficiency, productivity and results is where small businesses are focused and what they want out of their workplaces.

I would like to make a few comments about my home state of South Australia before I get onto the government's small business policy agenda. South Australia, unfortunately, is one of the highest business taxing states in Australia. These are not my words; these are the words of our local business chamber, Business SA, the self-proclaimed voice of business in South Australia, so they obviously know what they are talking about. We have seen business closures and job losses, and not just in South Australia; small businesses around Australia are haemorrhaging.

It is no surprise that they are finding life tougher after Labor introduced tax after tax, whether it was the carbon tax or the mining tax. At state level, the emergency services levy has increased, which is causing some grief for small businesses as well. There are reports in some areas of a significant amount of their bills going up, placing more pressures on them. In my electorate we have businesses that have said the carbon tax is contributing to the increase in their utility bills by around $14,000 for one business and over $40,000 for another. This is why it is so important that we have acted like we have to remove the carbon tax and other taxes.

On the positive side, there are some business-friendly policies that we have started implementing in addition to those that I have mentioned, and I will touch on them later. We have also seen some positive employment trends, with over 100,000 jobs being created in Australia, and this is as a result, in part, of our business-friendly policies. Our challenge now is to continue to find ways to help businesses grow and hire new people, and to reduce their burden of regulation and their cost structure. In my electorate of Hindmarsh, I am working with local councils to help businesses in my area, whether that be through tourism projects or the $155 million from the government's Growth Fund to help innovative manufacturing companies invest in new capital equipment.

At the national level, our broad agenda is encouraging entrepreneurial behaviour, productivity and competitiveness. I will just run through a few points in this respect. In terms of tourism, which for my electorate is so important with its cafes, restaurants and the airport, we have $43.1 million over four years to implement the new Tourism Demand-Driver Infrastructure Program. In terms of entrepreneurs, we have close to $500 million over four years to establish the new Entrepreneurs' Infrastructure Program. Having dealt with entrepreneurs over many years, I know how important they are as an ecosystem of Australia's economy because of the innovation they bring, because of the jobs and wealth they create and the employees that they bring on board on their journey. Because of this importance, I have talked to a number of entrepreneurs about the employee share-ownership scheme. I am working with my colleagues in trying to get a better structure in place, so that there are incentives for highly skilled employees to join these fast-growing firms, these start-ups, these companies that have had success in recent years, like Atlassian or Freelancer. They have been success stories and we need more of them in Australia. That is why our policies are on the right track in helping create a better environment.

In terms of small exporters, there is a boost to the Export Market Development Grants program, which will help small- and medium-sized businesses access export markets. From working overseas in Europe, assisting trade and investment, and from working with small businesses, I know how important this sort of support is to getting it right. There is $15 million over four years to support small exporters.

Another positive initiative is the Small Business and Family Enterprise Ombudsman and there is $8 million over four years to transform the existing office of the Australian Small Business Commissioner. And there is the company tax rate. It is so important to get company taxes down to create more incentives for our businesses around Australia. This will provide a benefit for close to a million small and medium-sized businesses.

An important initiative of government is improving small business access to contracts. This is something that many raise with me—access to procurement and government contracts, and a better understanding of how they work. We are helping small businesses by providing close to $3 million to help access the Commonwealth procurement market, which will help them with their requirements to meet expensive insurance obligations and other compliance documentation. These are barriers when they are tendering for contracts. There is the new Commonwealth Contracting Suite for contracts valued under $200,000 which will make it easier for them as well. There are so many different areas that we are looking at to help with small businesses. I know the member for Deakin and others are working hard in their respective electorates to help small businesses and spread the message out there.

In terms of messages, I hosted a recent forum with the Minister for Small Business, Bruce Billson. Bruce is a member of our cabinet, and we are proud to have him in cabinet. Not only is he a very good minister and a great supporter of small businesses; he also sits around the table making key decisions. Unlike the members of the opposition who decide to play pass-the-parcel with the small business portfolio, we have placed a high importance on it, and that follows through with that appointment to cabinet. Small business as we know is so important for our country. It contributes about one-third of private-sector contributions to the economy. Close to five million Australians are employed in the area, and this amounts to around 43 per cent of private sector employment—a significant contribution.

Small businesses around Australia have told me continually of how they are struggling and how they are finding the new challenges with their operations. They are looking for government to assist in any way it can whether it is through the competition policy review—another positive initiative of the government—or other programs. That will be released shortly for consultation. Its broad remit looks at regulations and other impediments across the economy which are restricting competition and reducing productivity, and are not in the broader public interest. It is also looking at job creation, innovation, investment and helping small businesses grow and prosper. All these things are so important for small businesses.

In closing, it is through a wide array of initiatives that we are helping small businesses—on infrastructure, on regulation and on reducing taxes. Small businesses know they have a friend with the Commonwealth government. We will keep on fighting for the best results for small businesses because we know how important they are for our society. We know how important they are for jobs for families. They are the heartbeat of the economy and they have innovation and provide direction for our local communities. We will do everything we can to support them.

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

I thank the member for Hindmarsh for moving this motion because it gives me an opportunity to talk for 10 minutes at least on small business, which has been my life. I was a small-business owner for many years and I managed the trade association for small businesses in the recording sector for seven years. I worked with them to develop international markets and to develop the independent charts, which we still use. I have spent a lot of time in the sector. I listen to the rhetoric of the government, almost on a daily basis, and I am still looking for the action that meets that rhetoric. The competition review, for example, which the member for Hindmarsh said would be out shortly was actually out at 11 am today. So far, I have found three pages that actually deal with small business. It seems to be about privatising health and education rather than the many things that small businesses were promised by this government.

Government Member:

A government member interjecting—

One day the member interjecting is going to realise that the promises you make actually matter—that the small business sector will judge you by the promises you make. The member for Hindmarsh in his motion referred to the Commonwealth procurement market, which is an incredibly important market for small business, as we all know. I was really pleased back in 2011 when the Labor government changed the procurement policies to improve access to government contracts for small business by introducing a basic contract suite which simplified the contract processes, dealt with complexities in insurance, provided appropriate insurance levels, simplified the language and made it much, much easier for small business to tender for government contracts.

During the period after 2011 the department continued to monitor the effect of the basic contract and by November last year they came up with a new draft to increase the threshold level from $80,000 to $200,000—and that is the change that the member for Hindmarsh is referring to when he talks about the government introducing this new procurement practice. It comes into effect on 1 July. It essentially builds on the 2011 model. It increases it to $200,000, because in the period from 2011 to 2012 alone there were 85,000 contracts with small business for less than $200,000. So it adjusts the level to the appropriate level—and that is a very, very good thing—but it comes after many years of work by the department and by previous governments and builds very much on the policy that was introduced in 2011. I thank he member for raising it today. It is an improvement. Increasing it to $200,000 from $80,000 is an improvement and better reflects the changes in the procurement market since that initial basic contract suite was introduced.

The member's motion also refers to a lovely figure that they bandy around a lot, which is that 519,000 jobs were lost in small business under Labor! Every time it is said I ponder it because I know that in the period of the Labor government, in spite of the global financial crisis, the number of small businesses in Australia actually grew by 39,000. So one has to wonder how in the period of the Labor government there can be nearly 40,000 more small businesses, yet we have a government that continues to repeat this figure of 519,000 jobs lost in small business even though small businesses grew.

A government member: It is a different statistic.

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

It is a different statistic, and I am going to deal with the statistic because it is actually really interesting. The ABS uses a completely different definition of 'small business' to anyone else. If you look around the different groups, ASIC says that a small business has a revenue of less than $25 million and fewer than 50 employees; the ATO has it as a turnover of less than $2 million; and Fair Work, 15 employees. But ABS has a unique one, which is less than 20 employees and then you are a small business. During the period of the Labor government, from 2007 to 2013, there was an actual reduction in the number of people employed in that sector in businesses of less than 20 people. There was, that is actually true, but what the government does not tell you is the number of medium businesses increased dramatically. So during that same time, the number of people employed by medium businesses actually rose by 1.9 million to 2.7 million—a substantial increase in the medium sector of businesses, which are businesses of more than 20 people and less than 200 people.

So what we had here was the number of small businesses decreasing and medium businesses increasing. It could be that the small businesses grew, for example. It could be that they grew so they no longer appeared in the ABS group of less than 20, because suddenly they had more than 20 people. That would account for the fact that there are so many more people employed in small business. In fact; during the period of the Labor government there was an annualised 1.8 per cent increase in the number of employed people, including an additional 822,000 people in medium-size businesses and an additional 757,000 people in large businesses. And there was an additional 39,000 small businesses in the economy. So the government is very, very good! We have seen the government's slight of hand in many, many cases over the last year. We have seen their extraordinary capacity to take one figure and turn it into something else. This is absolutely another case of this. Only the Abbott government would think it was problematic that small businesses with less than 20 people grew to be bigger ones. Only the Abbott government would find that problematic, but they do. It is a convenient figure they can keep bandying about to confuse the issue and make quite an effective small business strategy appear other than it is. I can tell you, Member for Hindmarsh, that it is actually a good thing when a business with fewer than 20 people employs more than 20 people. It is actually good to employ more. It is good to move from the ABS category of fewer than 20 people into the medium one. It is a very good thing.

The extraordinary thing about the Abbott government's rhetoric when it comes to small businesses is the notion of certainty. If you remember, prior to the last election we had a government that was all about certainty: 'We need to provide certainty for business.' Since they have come to government, it has been anything but certainty. You can see the recent announcement of the removal of the instant tax write-off, for example, and the loss carry-back, which has been on and off and the dates were unknown. Then the dates were going to be announced, then the dates were announced, and now they are retrospective. We have businesses that made decisions in the last financial year based on tax law as it was and who will now have to pay additional tax because the tax law has been changed in retrospect. There is nothing certain about that. In fact, it is perhaps the most extraordinary case of uncertainty in the government's short history so far—that you would actually tell businesses that operated under existing tax law in the last financial year that in the next financial year they are going to backdate the law and the businesses will have to pay more tax. There will be hundreds of thousands, if not millions, of small businesses that will be paying more tax unexpectedly because of that backdating.

Look at family day-care providers. They are still unsure about what is going to happen with the funding. They are in every sense small businesses. There has been $157 million of funding cut or put on hold. In my state of New South Wales, there are 231 of these services, supporting thousands of educators, who are all small businesses. They have been waiting and waiting for the government to make any clear statement about what their future will be. The government in the election said that the new changes would not affect existing businesses: 'Go ahead, make your plans, invest. We're for certainty. We won't change the law relating to existing businesses.' But they have. How is that for certainty! They tell you one thing; they tell you that they are going to stick to their word; they tell you that they are not going to affect you; and then they do. They ripped the funding away from literally thousands of small-business operators with no notice and, in fact, in complete disregard of the promises they made.

Look at the submarines in Adelaide. Look at the election promise: 'We will build 12 submarines in Adelaide. We will do that.' They were still saying they had not made up their mind. So people actually made investment decisions based on that guarantee. Small businesses made investment decisions based on that guarantee. And what happens? Gone. So much for certainty! In fact, the rhetoric by this government is phenomenal: 'We're for small business'. But their actions are completely the opposite.

Michael Sukkar (Deakin, Liberal Party) Share this | Link to this | Hansard source

It gives me great pleasure to second this motion. I think what we just heard then from the member for Parramatta was confirmation that the Labor Party has learnt nothing from its six years of dismal failure in small business. We have just heard a recitation of how small business is thriving and how there are no problems in small business. In fact, in six years the only problem with small-business policy under the Labor policy was that these businesses grew to become medium-sized businesses. That is the most outrageous and out-of-touch thing I have heard. The data does not prove it. You can make up any statistics you want to try and prove an argument, but you have just proved how out of touch you are with society.

So I will go to small businesses in Deakin and say, 'The member for Parramatta thinks small business is thriving,' and they will say: 'Oh, yes, that's the same party that imposed the carbon tax. That's the same party that voted against the repeal of the carbon tax.' I am glad we have had that confirmation today. Talking about certainty, I must touch on that point too: six small business ministers in six years. For the member for Parramatta to try and have a straight face while coming out with that guff is absolutely outrageous.

I will go back to the motion, which is an absolutely outstanding motion put forward by the member for Hindmarsh. It is an example of the high priority that this coalition government places on supporting small business—not outrageous rhetoric that we get from those opposite. Small businesses, as the member for Hindmarsh said, are the backbone of our economy, and certainly the backbone of the economy in my electorate of Deakin. Having grown up in a small business family, I am acutely aware of the tremendous opportunities and hardships that life in small business can present for all those involved.

There are over 13,000 small businesses in my electorate of Deakin. The vast majority of them are businesses that, quite frankly, are doing it tough and really go month to month in trying to make ends meet. The figure of 12,000 to 13,000 small businesses per electorate is not particularly unusual to Deakin; it is actually quite representative around the country. Small businesses drive employment, innovation and growth, contributing about one-third of private industry's contribution to the economy and employing around 4.5 million Australians, or about 43 per cent of private sector employment. Of course, those employment figures were significantly higher under the Howard government when small business represented 53 per cent of private sector employment.

Regrettably, as I have touched on, over the last six years 519,000 jobs were lost in small business. Labor have never prioritised nor understood small business, with their focus primarily on large, unionised corporations. The coalition government has made it clear from the outset that we value small business and have been implementing plans to help rebuild the sector. The Prime Minister commenced by appointing a Minister for Small Business, the Hon. Bruce Billson, and ensuring that he sits in the cabinet. The small business sector can rest assured that Minister Billson is advocating for their needs and interests at the cabinet table.

At the same time, the government moved the small business policy function into Treasury, recognising small business issues should be factored into wider economic policy. These fundamental changes demonstrated a level of respect and appreciation for the small business sector, which has been missing under Labor, and a commitment to restoring business confidence and supporting the sector. But we are changing a lot of the issues surrounding small business. We are making significant changes to improve the life of small business.

Going to the motion, the government has demonstrated its commitment to providing $2.8 million over four years to make it easier for small businesses to do business with government. We have heard about the Commonwealth contract suite for contracts valued under $200,000. We have also implemented a 'pay on time or pay interest' policy to ensure that small businesses, where cash flow is so important, are not disadvantaged by slow payment.

We believe that small business have a lot to offer government. We want to be able to access the goods and services that they provide and we want that to increase the competition for government contracts, benefiting taxpayers and government alike. I could talk about numerous other commitments—cutting the carbon tax, the competition policy review and the new Small Business and Family Enterprise Ombudsman—but our time is limited today; so I just conclude by reiterating my strong support for the motion.

Lisa Chesters (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

The motion that is before us today actually demonstrates a number of great myths that the Liberal government and the Nationals like to perpetuate about small business. It is also a wonderful piece of window-dressing and the pretence that there is a government actually doing something for small business. In the previous contribution, what I did discover is that the member for Deakin and I do have something in common. I, too, grew up in a small business family. My parents owned a second-hand furniture business on the Sunshine Coast, and I spent many summers working there as a child. It was just what you did. We did not get school holidays like most other kids because we were helping out in the shop.

They had one employee, but predominantly the business was being run by my parents—they did the work. That is the traditional small business. What is not being talked about in this debate and this motion is the changing face of small business. There has been an explosion of people who are being forced into their own small businesses through subcontracting and this is not your traditional face of small business. Take, for example, the cleaning industry, where cleaners are being forced into their own ABN subcontracting arrangements. They do not have the same on-costs as traditional small businesses: they do not have rent to pay and they do not have the set-up costs involved in running a small business—they do not have those overheads. They have a company that they subcontract to. Quite often they receive their uniforms from the company, they receive their supply of chemicals from the company and they are paid by the company. So within this debate about small business, we need to start talking about the definition, not just in terms of the number of employees but also in terms of the nature of small business today.

What we are also seeing from this government—and they like to talk about the good things they are doing—is that they do not talk about what they are taking away. We have seen this government backing away from key reforms introduced by the former Labor government that really made a difference—tax incentives that really made a difference to small businesses. This is where I am talking about what this government has introduced which is $5 billion worth of tax assistance to small businesses. This includes increasing what Labor did in government which was to increase the instant tax write-off threshold from $1,000 to $6,500. This allowed businesses to reinvest in their own equipment, which could be anything from upgrading or purchasing a new ute to other equipment they may need for their business. This government has also abolished tax relief to allow carry-back tax losses for up to a million dollars that businesses can receive as a refund against their previous tax paid. These are measures that were helping small business that this government has now abolished.

In this motion, the government talks about what they have done for government procurement. Well, let's talk about what they are doing in defence procurement. Just a couple of local examples: ADA is a manufacturer in the Bendigo electorate. They were quite excited to hear that this government had awarded a new defence manufacturing contract to ADA in Australia. But that work will not be performed in Australia. That work will go to the lower-priced jobs overseas—to small business and businesses overseas. So when it comes to procurement this government may have introduced some new guidelines, but the actual work when it comes to procurement is still going to overseas companies.

There is no greater example of that than what is happening in defence manufacturing. I know from talking locally to Thales Australia and the supply chain, that when it comes to the Bushmaster Protected Mobility Vehicle—that great iconic defence vehicle that has been manufactured in Bendigo—there are a number of small businesses that feed into that supply chain. They are worried about the next contract at Bendigo Thales. Will this government do the right thing and award that contract, the Hawkeye contract, to Bendigo Thales? There are a number of small businesses locally that will benefit from that contract.

This motion is a bad motion. It tries to perpetuate these myths about Labor and small business. Worse still, it is window-dressing—window-dressing that tries to cover up what this government is actually doing to hurt small business. That is why I am encouraging people to vote against this motion. There are a number of areas that we could go on about, about how this government is hurting small business when it comes to the RET and what that is going to do to our solar industry and when it comes to manufacturing as I have talked about. When they talk about this great red-tape repeal (Time expired)

Nola Marino (Forrest, Liberal Party) Share this | Link to this | Hansard source

I commend the member for Hindmarsh for his motion. As we know, the coalition, the minister, the small business minister in particular and every member on this side, including those who are sitting here, well understand that small business is the engine room of the Australian economy. I am the daughter of small-business owners and I am in small business myself, so I certainly understand what it takes to be in small business and to build a business from scratch. We know that this measure is so important, particularly to a lot of rural and regional communities right around Australia.

Of the over two million actively trading businesses in Australia, almost 96 per cent are small businesses and 3.8 per cent are medium businesses. Between the two, they employ nearly 70 per cent of the nation's private sector workers, or 59 per cent of all Australian workers. We understand on this side, after the neglect of Labor, how important small business is. We also know that small business has never had a better friend in Canberra than the Abbott government. We have delivered a new way for small businesses to interact with the Commonwealth, with real powers, through the transition of the Small Business Commissioner into the Small Business and Family Enterprise Ombudsman.

For those of us who have actually owned small businesses, it can often be frustrating for smaller businesses to make sense of the often complex information and broad array of services the government offers. The government is actively and practically helping businesses to help themselves. The ombudsman will provide straightforward advice that will help businesses understand disputes and how they can be avoided in the future—practical, simple solutions. Part of the responsibility of this Commonwealth-wide advocate for small business and family enterprises is as a concierge for dispute resolution services and a contributor to the development of small-business-friendly Commonwealth laws and regulations. That is really important when you are the people on the ground in your small businesses, with the limited amount of time that you have and the workload that you carry, and also the personal investment that you place in your business.

The ombudsman will seamlessly link with the government's Single Business Service to help small business easily find out about other government services and programs, including general business advice. I encourage small businesses to look at the Australian tax office small-business assist 24/7 service and its after-hours call back service. This is very important for small business people who work in their businesses as well as on their businesses. Time is so critical—we have understood that in the measures we have taken. That the ATO has small-business fix-it squads and small-business assistance visits is very practical for small businesses.

We have also set up a new unit to provide specialist service on contracts and to ensure small businesses are not disadvantaged as part of Commonwealth departments' tendering and procurement processes. The Abbott government has allocated $2.8 million over four years to deliver on this important commitment, which will help small businesses access Commonwealth contracts. Small businesses are constantly telling us on this side that contracting documents and accompanying obligations, including requirements to have very expensive insurance, can be overly complex and difficult to manage. The $2.8 million in funding in the next four years will set up a Department of Finance unit to work directly with small businesses to develop procurement guidance material tailored specifically for small businesses.

The federal government has also moved on its election commitment to extend unfair contract term protections from consumers to small businesses through the white paper. While the Australian Consumer Law currently protects individual consumers from unfair terms in standard-form contracts, it does not currently provide such safeguards for small business. Small businesses, like individual consumers, are often offered pre-prepared contracts on a take-it-or-leave-it basis and can lack the resources to effectively navigate or negotiate these contracts. They are also time poor and they have invested so much—it is their life, almost—in their small businesses. You meet so many small-business people for whom it is their one chance in life. They are having a red-hot go. What we want to see is more small businesses, more people, investing in themselves and their futures, so the measures taken by this government are very important to small businesses on the ground.

I commend the member for Hindmarsh on his motion. I really encourage all of the small businesses in my electorate—those who invest in themselves. They have a go, they put their hand up and, as I have heard the Minister for Small Business say previously, they invest everything. They put their houses on the line and often their cars. As he said previously, they sometimes even mortgage their kids to get into small business and just have a go. That is the passion of small business, which is why I am proud that we have a government that is supporting them.

Bernie Ripoll (Oxley, Australian Labor Party, Shadow Minister Assisting the Leader for Small Business) Share this | Link to this | Hansard source

This motion, unfortunately, is not about supporting small business. It is not about giving assistance to small business. It is not about giving hope to small business. It is not about anything positive towards small business. This motion is all about scaremongering and peddling petty myths and untruths from the Liberal Party. It is more focused on Labor than it is on small business. I think that is a great shame and a great wasted opportunity in the House. I just say to the Liberal Party: shame on you. Shame on you for always claiming you are the supporters of small business, when in fact you just talk about small business. When it comes to supporting it, you always side with big business. You never side with small business, and there is evidence strewn everywhere of the facts. The facts are that when Labor was in government we did some real things for small business. We did not just talk about it.

It was Labor that increased the small business instant asset write-off threshold, from $1,000 under the Liberal Party to $6,500 under us. And guess who takes it away? The Liberal Party. The Labor Party give it for six years and the Liberal Party take it away the first day on the job. The first day on the job, the first thing they do for small business is take away the assistance that was put in place. This was helping small business make a difference. This was helping with their cash flow. This was the real sort of stuff. We hear all the bleating on the other side about small business putting everything on the line. Yes, they do—so give them a bit of a hand. That is what we did, particularly in one of the key areas of small business, which is cash flow.

In the 2012-13 budget it was Labor that announced we would provide tax relief for business by allowing them to carry back tax losses of up to $1 million, so they could receive a refund against tax already paid. That is real assistance, and that is something that has been really taken up by small business. In fact, from 2013-14 business were to be able to carry back tax losses for two years, not just one. What is the first thing the Liberal Party does when it gets in? It takes that assistance away from small business. It talks about it, but it takes it away. It does the hard stuff, the really bad stuff, to small business. These three tax incentives alone for business and small business, when combined, were worth in excess of $5 billion. That is what the Liberal Party took away from small business. They ripped $5 billion out of the heart of our economic driver in jobs and employment, which is small business. If you ever wanted a better example of the Liberals talking about small business but on the other hand hurting them, there it is.

They talk about jobs and job losses, but there could not be anything further from the truth. It does not matter how you dice it and slice it and look at the numbers, the reality is that during Labor's term in government from 2007 to 2013, the number of people employed by small business and business right across the board went from about 9½ million people to 10.6 million—a net annualised average increase of 1.8 per cent. That is quite significant and quite good, particularly given that the rest of the world went backwards a long, long way. This was during the global financial crisis. This was when Labor acted to support small business. This was when we took it on ourselves to do the hard lifting to help small business, to help them to do the hard lifting as well. I know that any fair-minded, decent-thinking person would have done the same if they cared about small business. I am not even saying the Liberal Party might not have done the same. Maybe, if they had had the opportunity, they would have. But the evidence is not there, because when they get to government they take all the assistance away. The fact is that we have taken small business and grown them into medium business. We have taken medium business and grown them into larger businesses. We have made sure that under Labor we had the right policy settings in place, the right sort of assistance and the right sorts of measures, where it was not just about hot air and talk. There actually was direct assistance. We did a lot of things to support small business and business directly, and I am really proud of that.

It was also Labor that commissioned the first national Small Business Commissioner in this country, because we knew that small business needed a direct national voice to government. I am very happy to say that that position should stay in place. The Liberal Party, while they might have watered down some of the roles of the Small Business Commissioner, have at least had the decency to keep that role in place. It was Labor that set up the superannuation clearing house to reduce red tape and the paperwork burden on small business. It was Labor that put the national business names register in place, instead of having disparate systems all over the country. Small business went from paying an average of $1,000 across the country to just $30. There was online standard business reporting. That is what you do to support small business. Labor does not talk about small business; it supports them.

Karen McNamara (Dobell, Liberal Party) Share this | Link to this | Hansard source

In electorates such as Dobell, small-business operators are the engine room of our economy and deserve support and recognition from government. I am proud to represent the 8,939 businesses based in my electorate. The member for Hindmarsh is correct in saying that small business is a major driver of economic growth in Australia. This government has a strong track record in supporting business. We understand that you cannot have a strong and healthy society without a strong economy to sustain it, and you do not have a strong economy without profitable businesses. While this is a fact that has been lost on members opposite, this government has been delivering real relief and assistance to small business operators Australia wide. Small business is the backbone of many regional economies. Unfortunately, many small-business operators find themselves time and resource poor. A major contributor to this has been the burden of compliance.

I have previously spoken in this place about real-life experiences of small-business operators in Dobell whose struggles with the cost of compliance impacted on their productivity and on their ability to grow, invest and create new jobs. The cost of compliance is a major barrier to growth. The average Australian business deals with eight regulators in a given year, spends close to four per cent of their total annual expenditure on complying with regulatory requirements, and spends approximately 19 hours a week on compliance-related activities.

This government is addressing the issue of excessive regulation, and earlier this year we held the Regulation Repeal Day, which removed $700 million worth of compliance costs from our economy. For small-business operators, Regulation Repeal Day removed specific regulatory requirements, many applicable to textile, clothing and footwear suppliers under Commonwealth government contracts. This government also removed regulatory imposts applicable to more than 20,000 annual tender processes for Commonwealth departmental and agency contracts. This resulted in the removal of tendering costs associated with Commonwealth government contracts otherwise not incurred by business when dealing with the private sector.

A major obstacle facing small-business operators in securing government contract is the 'take it or leave it' condition. Small businesses, like individual consumers, are often offered pre-prepared contracts on a 'take it or leave it' basis, and many lack the resources to effectively navigate or negotiate these contracts. As part of the budget, the government is committed to $1.4 million to support the extension to small businesses of unfair contract term protections, currently available to consumers. A further $2.8 million is allocated over the next four years to establish a unit within the Department of Finance dedicated to providing specialist advice on Commonwealth government contracts and conducting business with government. Such assistance will ensure that small-business operators are well informed to compete on a level playing field with big business and are not disadvantaged when dealing with Commonwealth government procurement. Such practical help will contribute to turning around the fortune of small-business operators and reverse the trend of small-business closures that we unfortunately experienced under the former Labor government.

As a result of the former Labor government's actions, we saw 519,000 jobs lost across the small-business sector. In my electorate of Dobell, small business is collectively the largest employer, employing approximately 40,000 people. As the member for Dobell, growing the Central Coast economy and providing jobs close to where people live is a key priority.

This government acknowledges the role small business can play in delivering services and vital infrastructure on behalf of the Commonwealth government. In Dobell, we have recently seen local companies, such as RelativeMilat, based at Tuggerah, successful in tendering in competition with larger, out-of-region firms as part of the NBN rollout. This sends the message to other local businesses in Dobell that they too can be a reliable supplier for Commonwealth services.

Furthermore, increased competition will deliver better value for the taxpayer's dollar, and the potential to see direct investment in regional economies driven by small businesses successfully tendering for Commonwealth government contracts. This government's actions recognise and support the role small businesses play within the Australian economy, and acknowledge their capacity to deliver outcomes for Commonwealth departments and agencies.

The measures outlined in this motion demonstrate that this government is proactively assisting small business to become more productive, to contribute to the Australian economy and to provide opportunity to grow, hence resulting in more local jobs in our communities. I commend the member for Hindmarsh on his motion.

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

I would like to strongly support the first point of this motion that acknowledges that small businesses are a major driver of economic growth in Australia. I would also like to strongly support that small businesses make an enormous contribution, that they often do not have the resources and that they face significant obstacles.

As a person that has both worked in small business and owned a small business, I really do understand the issues that relate to small business. But I always find it amusing when members on the other side of this parliament stand up and portray themselves as the friends of small business, when in actual fact everything they do, every action that they take, make it harder for small businesses to survive. It seems to be the rhetoric that they adopt. In actual fact, they are the friends of big business and the friends of exporting jobs overseas and exporting small business opportunities overseas rather than actually contributing to the day-to-day viability of small businesses.

We only have to look at the recent announcements in relation to defence and the Abbott government's failure to support future submarines in Australia. At every opportunity that they have had, they have failed to actually take up the cudgel, get in there and fight for small business. They use the rhetoric of cutting red tape. Well, I only see this government putting in place more red tape. Their repeal day was a joke day. They talk about repealing redundant Commonwealth legislation. A lot of the legislation that they repealed was just about the wording in the legislation. It is just what this government does so well—creating a smokescreen, creating an atmosphere where they purport to be doing something when in actual fact they are doing nothing.

This motion talks about employment opportunities and how there has actually been a decrease in the number of people that were employed in small business during the time that Labor was in power. That is correct—it did go down from 5.1 million to 4.5 million. But what happened was that those people actually moved to medium-sized businesses, and there was a 6.2 per cent increase in employment in that sector.

This government has ripped benefits away from small business. The instant asset write-off that was in place allowed businesses to write off the taxable proportion of the value of an asset that cost less than $6½ thousand. The number of assets it could be applied to was unlimited. From 1 January this threshold was to be increased to $1,000. This is gone now under this government, showing a total lack of respect for small business. It is the same with special depreciation rules for motor vehicles. Gone! This government actually shows a lack of commitment to small business, shows a lack of commitment to innovation and takes money away from all the areas that support small business. I know that members on the other side of this House argue the opposite way, but when you get there and you look at actually what has happened, you see that this government has been attacking small business not supporting small business.

It is organisations like the Lake Macquarie Business Growth Centre that actually support businesses on the ground, that provide help and encouragement to get around the hurt and impost that has been placed on them by this cruel, mean Abbott government.

Lucy Wicks (Robertson, Liberal Party) Share this | Link to this | Hansard source

I am delighted to support this motion today because it is in support of small business, and to be able to outline just some of the measures that this fantastic government is undertaking to make life easier for small businesses across Australia, particularly in my electorate and on the Central Coast. I commend the member for Hindmarsh for moving this motion, because small business is one of the largest drivers of economic growth in our nation and one of the best local economic drivers of growth on the Central Coast, and small business has this government's support.

There are more than two million small and micro businesses in Australia, which account for 95 per cent of the total number of businesses across the country. More than 12,000 of these are in the Gosford local government area and they make a significant contribution to the Central Coast. Nearly half of Australia's private, non-financial workforce are employed by small business, and they contribute 35 per cent of Australia's production. Unfortunately, those on the other side of the chamber, when they were in government, sought to impose barriers to the success of small business. Under Labor, 519,000 jobs were lost in small business, and the procurement market was a closed shop with such significant restrictions and barriers that small business could not compete with the time, complexity and insurance obligations.

Rod Dever from ORS employment solutions, a recruitment agency based in my electorate in Gosford, told me that the key is the amount of time it takes to administer a small business. This includes reporting, paperwork to the tax office and payments that can add on so much extra time. This is on top of the daily running of a business, which requires a high level of dedication, often for long hours, and nearly always seven days a week. Rod said to me that it is the burden of registrations, regulation and accreditation that all cost time and money. There are also fees from all levels of government which, he claimed, can eat into the dollars made on a daily basis. These are just some of the challenges faced by small business to meet basic requirements, to secure government contracts. But this government, through Minister for Small Business Bruce Billson, is taking the brakes off small businesses and once again working to help them thrive.

We have allocated $2.8 million over four years to assist small business to access the Commonwealth procurement market. This was a commitment that we made prior to the election and that we are delivering on. This package will see a special unit set up within the Department of Finance to work with small business in order to develop the resources that employers need. The government have also committed to repealing burdensome, unnecessary and stifling regulation with our regulation repeal days. The Parliamentary Secretary to the Prime Minister, Josh Frydenberg, has taken charge of this agenda and our efforts have removed the regulatory imposts that apply to more than 20,000 annual tender processes for Commonwealth agency work, which imposed additional costs on companies, particularly small business, compared to contracts in the private sector.

In conjunction with our first repeal day, the government have also undertaken a range of reforms to grants and procurement processes which include standard contract terms being applied across agencies for procurements under $200,000; a standard agreement template for low-risk grants across agencies; and the use of credit and debit cards for payments under $20,000—previously $10,000—which should assist small businesses with cash flow. These changes have been estimated to lead to an annual saving of $62.23 million in compliance costs.

I also know from my experience and from talking to many small businesses on the Central Coast that, when given the chance and a level playing field, small business can deliver a much better product than some of the larger players. By their very nature, they are innovators. As more small businesses enter the procurement market, I know they will inspire innovative solutions to many of our challenges. Daniel Farmer, the Regional Manager of the Central Coast NSW Business Chamber, has said to me that they want to have an open discussion about issues that impact them. He said small businesses have been cautious but very encouraged by this government's changes that boost local jobs and boost local growth.

We have a tremendous, innovative small business community on the Central Coast, but they are time and resource poor and they face significant obstacles in securing government contracts. I encourage as many businesses as possible in my electorate of Robertson to come forward and compete for these contracts, no matter how small they may be. By working together with small business, the government wants to provide the right environment for small business to thrive, generate local jobs and build a stronger economy.

Pat Conroy (Charlton, Australian Labor Party) Share this | Link to this | Hansard source

This motion demonstrates yet again the basic economic illiteracy of the coalition. All they have been able to deliver so far has been empty rhetoric regarding support for small business. In this motion they have plucked one single figure out of a period of outstanding economic growth between 2007 and 2013. It does not matter where the jobs are grown in Australia. It only matters that we grow Australian jobs. Under Labor, almost a million jobs were created. During the global financial crisis, when we saw tens of millions of jobs stripped out of economies worldwide, we grew just under a million jobs. This motion, which points to one single statistic, demonstrates the economic illiteracy of those opposite. It is not a surprise given the fact that they are led by a Prime Minister who Peter Costello said cannot be trusted on economics, a Prime Minister who slept through one of the most crucial votes on stimulus packages during the global financial crisis.

I am proud of Labor's support for small businesses when we were in government. I am proud of the fact that we implemented a $6,500 instant asset write-off that allowed small businesses around this country to instantly write off $6,500 worth of capital purchases, whether it was a new fridge and freezer for a cafe or a new piece of equipment for a machinery shop. This was a great initiative that is now under threat. We also put in place a new $350 million venture capital fund to ensure that the innovators that the member for Robertson nominated in her contribution could get the capital to grow their businesses so that they did not stay as small businesses but grew into medium and large-sized businesses.

We put in place the Australian Jobs Act—a great piece of legislation that compelled large projects to give Australian companies an opportunity to win work on their projects. This was matched with requiring large-scale companies that applied for $2 billion or more of EPBS concessions to put in place Australian supply chain offices in their global headquarters, to give Australian small businesses and SMEs a great opportunity to win work not just here but overseas in the large supply chains of large multinational corporations.

This is now all under threat. We have seen that the instant asset write-off has been withdrawn and withdrawn retrospectively. Those on the other side like to talk about the red tape. But imagine withdrawing, halfway through a tax year, a tax measure in the tax instant asset write-off. That means millions of small businesses who have already claimed deductions for this will have to go back to level one and pay more tax because of this government. Talk about imposing a red tape burden. They have also committed to repealing the Australian Jobs Act. They are effectively saying that they will not compel large projects built in this country to give Australian companies and Australian workers a first go at winning work on these projects. That demonstrates not just the economic illiteracy of the government but their hollow rhetoric when it comes to supporting small businesses.

Let us look at their broader employment record so far. It is an ugly piece of work. We have got the highest unemployment rate since November 2002. On trend terms, unemployment is at 6.2 per cent compared to the average under Labor of 5.1 per cent during a period of the GFC. We have an unemployment queue that is 67,000 people longer than when they came to power. We have 32,000 more long-term unemployed than when they came to power. We have the highest share of long-term unemployed amongst those looking for work since this statistic began to be collected in 2001.

Let me recap that. We have got the highest unemployment rate for 12 years and we have got the biggest share of long-term unemployed amongst those looking for work for over a decade. This is a real concern. We should be debating how to boost employment in this country and not attacking the previous government's records, which were quite fine, in my view.

We will see even worse coming up in terms of the impact of the budget. We have seen $1 billion cut from training that would have supported small businesses. We have seen $5.5 billion stripped out of the higher education sector that would have provided graduates for small businesses to lead innovation. We have seen over $1 billion in cuts to child care—child care that lets employees of small business go to work and make a contribution. We have seen their punitive attacks on Newstart which makes it harder for job seekers to find work.

The truth is that this government's economic performance is appalling so far. I have no hope that it will improve. Instead of concentrating on looking at how they can improve this performance, they are just determined to attack the Rudd-Gillard government's legacy on economics, which was fine. Look at their great stewardship during the global financial crisis, where we led the world in our response and grew nearly a million jobs. I condemn this motion.

Debate adjourned.