Craig Laundy (Reid, Liberal Party) Share this | Link to this | Hansard source

I move:

That this House:

(1)    acknowledges that:

(a) small and medium businesses are the engine room of the Australian economy and employment;

(b) an effective infrastructure network is essential for small businesses to survive and flourish; and

(c) investment in improved infrastructure benefits small businesses through economic growth and job creation, and provides a boost to local and regional economies; and

(2)    supports the Government in prioritising infrastructure investment to help small businesses grow and continue their vital contribution to the Australian economy.

Mrs Bronwyn Bishop (Speaker) Share this | Link to this | Hansard source

Is the motion seconded?

Steven Ciobo (Moncrieff, Liberal Party, Parliamentary Secretary to the Minister for Foreign Affairs) Share this | Link to this | Hansard source

Yes.

Mrs Bronwyn Bishop (Speaker) Share this | Link to this | Hansard source

I take it you are reserving your right to speak?

Steven Ciobo (Moncrieff, Liberal Party, Parliamentary Secretary to the Minister for Foreign Affairs) Share this | Link to this | Hansard source

I am.

Craig Laundy (Reid, Liberal Party) Share this | Link to this | Hansard source

I thank the parliamentary secretary for seconding this motion. I speak often in this place about the value and importance of small and family businesses and the role they play in our economy. Today is another example of that, with this motion. I often say that I am a proud third generation Western Sydney publican, and I will go back to being that when the people of Reid see fit. But I know the frustrations, and one of my motivations in turning my back on my career for a while and doing this—and I do not consider this a job for me; I had a job and I can go back to it at any stage; I am lucky—is the chance to make a little bit of a difference. This is one of the areas that I try to do that in whenever I can.

One of the criticisms I always had outside of this place, before election, was the fact that this chamber and this parliament do not understand small and family business well enough. This motion today is a good example. It is often said that the Liberal Party is the party of small and family business and that the Labor Party is the party of the worker. I want to try and debunk that myth a little bit today, because I know from my 23 years in my family's business that the most valuable asset we have today is our staff—always has been, always will be. My grandfather taught my father that and my father taught me. I note that, of our five speakers following me today, Craig Kelly comes from a small and family business background; Nola Marino is a dairy famer, a family business person; and Andrew Broad, the member for Mallee, is another farmer and family business person. Yes we are, and we should be, the party of small business but small- and medium-sized business in this country employs, as at the 2011 census, 70 per cent of the workforce. That is why it is important that we as a party and as a government not only understand small business but do all we can to foster it so that people can continue to take on bank debt, back themselves, and employ people in an environment and an economy in which they have certainty.

We talk about jobs created and jobs lost. It is important to note that if people who run a small and family business lose their job they most probably lose their home. They take on bank debt using their home as an asset to secure it—and then they employ people. One of the biggest problems we had—a hidden problem—coming out of the GFC was the casualisation of our workforce. That is not spoken about enough. Small and family business operators in that uncertain period moved permanent staff into a casual capacity, and they did it to give themselves the flexibility of reducing staff when they needed to and working more themselves. What came next was truly abhorrent—the carbon tax. This crept into every line item in the profit and loss statement of every business in Australia, irrespective of size, but it was particularly troublesome for local small businesses in my electorate. The butcher, the baker and the candlestick maker will tell you that what happened was that the business operator either worked more hours themselves and decreased their staff numbers or reduced the hours that they operated—they closed on Saturdays, Sundays, public holidays and what have you. The spinoff of this is a decrease in casual labour opportunities. We often talk in this place about youth unemployment. Here is the kicker: casual work is where our youth most often find their start. Whilst they leave school and move into trade training or university, a casual job is what they do to keep living and getting out of the hair of their parents. As I said in my maiden speech, most people who stand up in this place who come from a family business background talk about their first job being in the family business. I am no different.

My major frustration pre-politics—I guess it continues today—is that time and time again those opposite stand up and argue to be for the worker when they quite clearly do not have an understanding that if you are for the worker you are for small and family business. In 2000 Kim Beazley famously said:

We have never pretended to be a small business party. The Labor Party has never pretended that.

In 2006 Craig Emerson said:

Labor, as a party, was born of the trade union movement. We are proud of our bonds with the trade union movement …

During the six years we had of Labor government, we had a litany of small business ministers that did not have any history in small business themselves, and it was not even a cabinet role. The first thing the Prime Minister did when we moved to the government benches was to make, as was our pre-election commitment, the Minister for Small Business, the Hon. Bruce Billson, a member of his cabinet team—as that minister should be, given the significance of the employment opportunities provided by small business. Even today the trade union movement is arguing for holiday and sick pay for casual employees. This is a false argument, and it is frustrating. I know that in hotels permanent workers earn $18.64 an hour. As casuals they earn $23.30. The holiday pay, the sick pay and the leave pay is factored into the increased casual rate. For Ged Kearney and her mates at the ACTU to argue differently is dishonest and deceitful. Any move to do this will put further pressure on local businesses in Reid, and it must be resisted—as we are resisting it—on behalf of businesses given that that is where 70 per cent of the jobs in this economy are created.

The Abbott government have already moved to do a lot, but there is a lot more to do. We made a heap of promises pre-election, which we are starting to deliver. We appointed a dedicated small business minister in cabinet, which I have already alluded to. We abolished the carbon tax, which most definitely gives the businesses in Reid a chance to be a lot more competitive and employ more people. The Hon. Josh Frydenberg, now Assistant Treasurer, in his time as Parliamentary Secretary to the Prime Minister led the charge to reduce red and green tape—$2 billion, although our promise pre-election was $1 billion, we have delivered more than twice that in our first 16 months in government, but there is a lot more to do. If you look at the employment in this sector under the six years of the Labor government and you want to see what the impact of their policy decisions were, there were 519,000 jobs that went missing in the small business category. That is about 1,600 a week.

Minister Billson has worked hard on reforming the national franchising code. Once again, a logical place, franchising, where people make the move from employee to employer, but they need certainty in legislation and Minister Billson is delivering on this. The competition policy review: the government has taken important steps towards ensuring that the competition framework is effective for all businesses by undertaking an independent root and branch review, and there will be more announced on this as we proceed in government. The Japanese and Korean free trade agreements came into effect in December and January; China's will come into effect later in the year. These are amazing opportunities for small and family businesses to reach out to the other side of the world and deliver products and services and create jobs. We have established a $482 million Entrepreneurs' Infrastructure Program. There is the infrastructure in Western Sydney, the hard capital infrastructure, with Premier Baird; the second Sydney airport, the 35,000 jobs that this will create. The road infrastructure with WestConnex, which is the most important piece of transport infrastructure to be delivered, will make a massive difference in the lives of all within Reid and unlock Parramatta Road for them.

We can never talk in this place about the role that small and family business plays enough. We should not only do so at every opportunity but we should also understand that it is the major economic driver—always has been, always will be—of our economy. We should aim policy to help improve the lives of not only those in the business but also the lives of those that they employ. I commend this motion to the House.

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

Like the member for Reid, I would like to debunk a few myths in this House as well, particularly the one that the Liberal Party is the government of small business. If it was, I am sure the member for Reid would have spent more time talking about the actual achievements of the government in relation to small business, rather than a large amount of time on the very nice statements that we all support small business. He also spent a relatively large amount of time bagging the Labor Party, as the government seems like to do more than anything else—rather than deliver, just bag us; it seems to be the answer to everything at the moment—and he then talked about some of the promises they made. He seemed hardly able to talk about any actual policies delivered to small business, so it is not surprising that when you look at how business is actually feeling under this government, it does not match with the rhetoric of this government being a 'government for small business'.

The Australian Chamber of Commerce and Industry recently did its major small business survey for 2014 and it found the index of expected economic performance fell markedly for the fourth consecutive quarter and has now been below a 50 reading for three quarters in a row. It also revealed that small business is expecting future decreases in profit. Again, for a government that claims to be about small business, small business is not feeling the love at the moment. When you look at the issues of concern to small business, it tells a completely different story to the one we just heard from the member for Reid. Business taxes and government charges returned to the No. 1 constraint on small business under this government. After being replaced by insufficient demand for one quarter, taxes and government charges issue is back on top. Insufficient demand has steadily gained in importance since 2012, and suggests tepid demand is limiting the ability of small businesses to grow in 2014. Import competition gained in importance as a business constraint, moving from fifth to third. Perhaps some of the free trade agreements that the government spruiks as so good, but about which we still have not heard the detail and if they were that good I would suggest that we might know the detail—but import competition has risen up the scale from fifth to third as an issue of concern to business. Nonwage labour costs jumped from eighth to fourth place, and a federal government regulations returned to the top 10, in fifth place, despite the rhetoric that this government spruiks on a daily basis about reducing red tape costs. The way that business is experiencing this government, as demonstrated by this survey, is in complete contrast to the rhetoric of this government about what it is doing for small business.

Let us have a look at why small business might not be feeling the love from this government. Let us look at what they have done for small business—and I use the word 'done' rather than 'achieved' because most of it is not positive. One of the first things they did was to abolish the instant asset write-off, along with a number of other tax benefits they abolished. There was a tax hike for small business of over $4 billion delivered in the first year of this government. The largest chunk of that came from the repeal of the instant tax write-off, which was $2.9 billion in assistance to small business—$2.9 billion gone in that first year. Not only was it gone, but it was gone in the most incompetent of ways. On 31 December 2013, when the government was planning on abolishing this from 1 July 2013—so it was within the term of the last government; they were introducing retrospective legislation that reached back into a previous term of government—the tax office website still said it was there. It still said that the instant tax write-off was available on 31 December. Businesses found out more than halfway through a financial year that the tax law that they thought applied actually did not. There were many businesses in my area caught unawares and that found themselves with a tax liability they were not expecting—$2.9 billion across the sector.

The government also repealed the loss carry-back. Again, on 31 December 2013 the tax office said it was still there and it was actually going to be increased for the next financial year, but in fact the legislation was before the parliament to abolish it from 1 July the preceding year. So, again, businesses not only lost $950 million through this tax hike but many of them also did not even know it was coming. They made business decisions throughout the 2013-14 year based on the perfectly good assumption that the tax law would apply, because it was there, up on the tax office website, only to find that this government had reached back into the term of the preceding government and abolished it.

There was $445 million over the forward estimates in assistance for small business through the special depreciation rules for motor vehicles that was also abolished. The Abbott government slashed the previous Labor government's $1 billion investment in innovation to $342 million. So $650-odd million in innovation and research programs was slashed by this government, despite 21,000 small- to medium-sized enterprises around Australia benefitting from that program. The Labor government had introduced quarterly payments for R&D, and this government also abolished those retrospectively. Again, companies that thought they would be receiving their R&D benefits on a quarterly basis suddenly found they had reverted back to annual payments—an incredible difficulty for the cash flow of small business.

This is from a government that claims to be in favour of small business; it claims to be the government for small business. All of the speakers on that side have proudly said today that they all come from small businesses. If they come from small businesses, then you would expect them to understand the importance of certainty. They certainly talk about certainty, but they certainly do not deliver it. There were $4 billion in tax hikes for small business in the first year of this government, but done with absolutely incompetent implementation so that businesses did not even know that the decisions they were making today would be made invalid tomorrow through changes to the tax law. It is really quite extraordinary.

Then, of course, let's look at what the government has done to the NBN. We had a plan in place to deliver high-speed broadband across Australia. I was in a small town called Bemboka a couple of years ago, trying to buy some beautiful coffee cups from an art gallery there. The poor business owner. I say 'the poor business owner' because I could not believe what he was going through. He was using dial-up. He took half an hour to take my credit card transaction because it kept cutting out, and eventually he went and stood in the middle of a field where he knew he could get a signal in order to take my money. If I had not understood that this appalling circumstance of keeping your customer waiting for half an hour just to take their money was absolutely not his fault, if I were not feeling really sorry for him at that time, I probably would have walked out. I doubt that I would stand in a city business and wait half an hour to pay, but in this case I did.

What is the government doing for this business—laying fibre to up the road and copper to his gallery, a kilometre from the main road? How on earth can we expect Australian businesses to thrive with the third-rate 'fraudband' that this government is delivering? My electorate of Parramatta is the second CBD. Western Sydney is the fourth largest economy in Australia and Parramatta is the capital of it. It is considered to be the second CBD. We have a government that is committed to delivering 25 megabits per second by the end of its first term, which is a year and a half away, but Parramatta is not even on the list at the moment. It was on the list. There were supposed to be 62,000 houses receiving fibre to the home during this term of government. It has been removed. Parramatta has been moved down the list or it is not on the list at all. So nothing is going to happen in Parramatta between now and the next election.

I can tell you, because I have surveyed my electorate, that the average speed in Westmead, for example, is 8.5 megabits per second on download and less than one on upload. In Northmead, which is a 10 minute drive from the CBD, the average is 10.5. In Carlingford it is 10.2. The fastest is in Parramatta, which is the second CBD, at 20. How on earth can this government even deliver its second-rate 'fraudband' before the next election, in the timetable it promised, if it is not even coming into areas like Parramatta and delivering high-speed broadband for the second CBD? How does this government expect small business in Parramatta to flourish in an international economy, with all of the opportunities for delivering services across our region to the north, if it cannot even keep its promise for a second-rate 'fraudband' of 25 megabits? Is this for small business? I do not think so.

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

It gives me great pleasure to rise to speak on the motion moved by my good friend the member for Reid on small business. But before I do I would like to pick up on a few points the member for Parramatta mentioned. She talked about how Labor was 'feeling the love' for small business. Let's go through how the previous Labor government shared the love with small business. We had no fewer than six separate ministers for small business—a revolving rotisserie. We had the good Dr Emerson, the good Senator Sherry, the good Senator Arbib and current members of the opposition: the members for Gorton, McMahon and Brand. All had their turn at being small business minister, and what did they achieve by 'sharing the love'?

Let's just have a look at their record over the six years. Despite the population growing and the economy growing, under those six small business ministers we had 3,000 fewer small businesses employing people. If we look at the number of people that small business employed under the previous Labor regime, there were 420,000 fewer. That is over 420,000 people who were previously employed in small business. Under the 'shared love' of the previous Labor government, there were 420,000 fewer.

In fact, I am sure many of these small business ministers misunderstood what their job was, because they achieved making the small business sector of our society smaller. Before they came to office the small business sector represented 53 per cent of the economy. After six years of disastrous policy, that number decreased from 53 per cent to 45 per cent. There are 420,000 fewer people employed. There are 3,000 fewer small businesses employing people. What a tragic, disastrous and appalling record.

The reason is that, unfortunately, the Labor Party simply do not get it. They simply do not understand small business because they have never been involved in it or worked in it themselves. It is small business that is the true driver of the economy. It is small business that creates the innovation. It is small business that is the job creator of this nation. That is why governments must get off the back of small business. We must reduce the amount of red tape, which is exactly what we are doing. It is the only way that we are going to get out of the mess that we have inherited, the legacy of the six years of the Labor government, the current reason we are spending 10 per cent more than what we are getting in income. The only way we are going to get out of that mess is through innovation and investment by small business. That is the only way.

That brings me onto the second point of the motion moved by the member for Reid where he talks about improved infrastructure. That is one of the things this government is doing. I look at my city and what we have already seen—the doubling and widening of the M5 through the East Hills and Bankstown area. That makes moving and delivering goods through south-west Sydney so much quicker for small business. We have seen, if re-elected, the New South Wales government's infrastructure plans to greatly improve New South Wales. There is the WestConnex project which is so vital to our small business community to enable small business to get around Sydney.

But what do we have promised from the Labor Party? We know that if a New South Wales Labor government ever came into existence their promise is to tear up, scrap and cancel those infrastructure projects so desperately needed for Western Sydney. Imagine a government having an election campaign promising to cancel infrastructure projects. That is what we have with New South Wales Labor. They plan to cancel parts of the WestConnex project. This would be an absolute disaster if it were ever allowed to happen. It would be a disaster for small business.

This government is getting on with making it easier for small business to get on with work and get on with employing people. It is not an easy task after the legacy of mess, debt and deficit that we have inherited, but we are getting on with the job. The most important thing we can do is in the area of competition policy and price discrimination. I look forward to our root-and-branch review being tabled— (Time expired)

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

I look curiously at these motions put up by the Liberal Party and I wonder why it is they need to remind themselves that small businesses and medium businesses are the engine room of the economy. Then when Liberal Party members get a chance to speak, they come in here and double their attack on the Labor budget rather than talk about what they have actually done for small business, which of course is very, very little. The only great big thing they have done for small business is take away, cut, defund and remove assistance programs, tax assistance, asset-building assistance and depreciation pools. That is what they have done for small business. If you listen carefully to what the Liberal Party members say on small business, they say, 'Let's attack Labor and that'll be enough.' The best thing the Liberals think they can do for small business is double the attack on Labor's budget. I think there is a little bit more to it than that. I think you have to deliver something concrete and real. You have to deliver it with funding. You have to you deliver it with real numbers.

Also, I am very interested in the way the Liberal Party always says that there were these hundreds of thousands of jobs lost in small business at the same time that unemployment under Labor was going up. But now under their watch unemployment has gone to a record of 6.4 per cent, a devastatingly high number. It is much, much higher for young people. Under their watch, they claim somehow they are doing more for small business, but unemployment is getting higher. Those are the real numbers. The last time unemployment was this high was 2002, and guess who was the employment minister. You bet you know it: Tony Abbott.

But, if there is one overarching responsibility that any government has towards small business, the economy and ordinary Australians, it is to at least keep confidence neutral. I would say their job is actually to lift the confidence of consumers and small business so that businesses can get on with the job they are doing, which is to employ people, to innovate, to do things, to invest in their own businesses.

But not only do they take away the physical means by which small business can do that, by taking away billions of dollars of direct assistance to small business; they then have a Treasurer who thinks the best way to increase confidence in Australia is to continually tell everyone that our economy is stuffed and that we are going to be like Greece very shortly. That has to instil a lot of confidence in small business! As I talk to small business, as I know the Liberal Party do, I listen to them, and what do they say to me? They say: 'Gee, our confidence is low. I was thinking about putting someone on, but I'm really scared.' What are they scared of? They are scared of us somehow turning into Greece, because the Treasurer of the country keeps telling them that is going to be the case.

So, when it comes to real investment, it ain't there. If they had just frozen the money, I would have a complaint about it. I reckon that would be bad enough. But they took the money away—billions of dollars. They took away the direct assistance. They smashed confidence.

There was a poll just recently, a really important one on the government. Consumer polls, as we know—the regular Newspolls that you get and all the rest of it—give a clear indication that the community does not like this government. They do not like the Liberal government. They do not like Tony Abbott. They just do not like this government. I think that polling has been consistent and clear for a while. But then there was another regular poll of business in this country, and business confidence is at a smashing all-time low. There has just never been this little confidence. I remember prior to the election Tony Abbott made a solemn promise, hand on heart: there would be a shot in the arm for confidence in our economy. What has happened since is that every measure of confidence has fallen off the table. It is one thing to say you are going to boost confidence, but you actually have to do something about it.

But there was an even more interesting poll taken very recently—one inside the Liberal Party, in the dark rooms of the Liberal Party itself, all the guys and girls sitting over there. They had a little poll in their caucus room. They excluded half their caucus from having a vote to start with, but of the half that were allowed a vote—the backbench—60 per cent voted against their leader, Tony Abbott, the Prime Minister, because they have no confidence either. They have lost hope. When you lose hope in your leader, things do not look too good.

So when I see this motion here before us, which talks about the engine room of the economy and employing people, I think: 'What a lot of pollywaffle from these guys.' Do something about the confidence in your own party room, for a start. Do something about the confidence of big business and small business. Do something about confidence in the economy. Start putting some real funds back into small business to help them make employment choices, to help them buy equipment and assets. Actually do something, like Labor did. We did it through the toughest economic times, through a global financial crisis, because that was the right thing to do by the economy—to make sure that small business kept employing people. The best thing you can ever do for the economy is make sure people have a job. (Time expired)

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

The member for Reid is absolutely correct in saying that small and medium businesses are the engine room of the Australian economy and employment. Since my election I have worked hard to represent the 8,500 businesses in Dobell who each employ between one and 20 people. Many of our local businesses are family operated and are looking for opportunities to grow and generate further employment. Collectively, these businesses are Dobell's largest employer and are crucial to the livelihood of our local residents.

This government understands that small businesses must be supported by an effective infrastructure network. Without this support, businesses become uncompetitive, stagnate and lack opportunity to increase the number of jobs they provide to the local community. Investing in productivity-boosting infrastructure delivers many benefits to small businesses, which in turn boost economic growth and job creation.

In regions such as the Central Coast, this is the main driver of economic growth and the development of a stronger job market. The Central Coast is attractive to businesses seeking a location that offers available greenfield employment land, lower costs of doing business, affordable commercial rent relative to Sydney, and ideal logistical access, located midway between Sydney and Newcastle.

My focus, as the member for Dobell, is to deliver productivity boosting infrastructure to the Central Coast. This is why I have advocated for business priority access to the National Broadband Network. The former Labor government's lack of consideration of Central Coast business needs in the original NBN rollout was inexcusable, particularly in regions such as the Central Coast, where infrastructure struggles to keep pace with a rapidly growing population. By delivering infrastructure, such as high speed broadband, local businesses will have the capacity to increase their productivity, grow and, in turn, create more jobs.

There should be no doubt whatsoever that this government is committed to delivering better infrastructure, and, in turn, creating more jobs for the Central Coast. Last month I welcomed the Hon. Jamie Briggs MP, the Assistant Minister for Infrastructure and Regional Development, to announce the commencement of the construction on the $3 billion NorthConnex—the long-awaited missing link between the M1 Pacific Motorway and the M2 motorway. NorthConnex will offer opportunities for local businesses and will engage with them throughout construction. A local business register will be established to advertise the 7,500 jobs that will be created during the construction phase alone, with another 1,200 jobs directly created by this project. These jobs will be a huge boost for our local economy, which has seen significant change over recent years.

The Central Coast evolved from a quiet weekend getaway destination for Sydneysiders into one of Australia's fastest growing regions. In Dobell, close to 1,000 businesses specialise in retail and hospitality. These businesses are highly dependent on the summer holiday period as, during that period, they do much of their trade. Our challenge is to expand tourism across the year by offering opportunities to encourage more people to visit the Central Coast and, in turn, support our local economy. Projects such as the Tuggerah sports precinct will have significant benefits for local small businesses within the tourism, hospitality and retail sectors. My vision for the Central Coast to become the sports tourism capital of New South Wales extends well beyond the playing fields. This government's investment of $1 million to commence the necessary studies to develop this $30 million facility signals our commitment to delivering infrastructure that will produce economic benefits. In addition to boosting sports tourism by enabling the Central Coast to host regional, state, national and international sporting events, the development of this venue will boost our local hospitality and retail sectors.

This government is further boosting local tourism by delivering funds to upgrade the Norah Head boat ramp. Again, this is a vital piece of economic infrastructure. It is the only sea access boat ramp in Dobell and essential to encouraging tourists to visit our magnificent coastline. Sadly, the ramp had fallen into disrepair, meaning that locals and tourists alike were unable to take advantage of some of our best natural assets. This project is now close to completion with funding from this government. Projects such as the NBN, NorthConnex, the Tuggerah sports precinct and Norah Head boat ramp are examples of this government getting on and delivering world-class infrastructure to grow regional economies, such as the Central Coast's.

Gai Brodtmann (Canberra, Australian Labor Party, Shadow Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

Like many on this side of the chamber, I am scratching my head about the member for Reid's motion. I am pleased to speak about the benefits of investing in infrastructure for small and medium businesses and I thank, in a way, the member for Reid for his motion. I agree with him, as we all do on this side of the House, about the critical role small to medium businesses play in Australia's economy and the critical role of investment in infrastructure to achieving success for those small to medium businesses.

I understand the challenges that small businesses face as I ran my own microbusiness for 10 years. Since entering parliament, I have established the Parliamentary Friends for Small Business and microbusiness. I am acutely aware of the key role small and medium businesses play in the Australian economy, and the support and recognition needed from government and from parliament. Small businesses employ more than five million Australians and contribute almost 50 per cent of private sector employment. At a time when unemployment is substantially increasing, it is critical that this House acknowledges the important role small to medium businesses can play in turning this trend.

In January, the national unemployment rate hit 6.4 per cent, which is the highest rate the country has seen since 2002. Nationally, 800,000 people have been left out of work, the highest number since 1994. The numbers are no better here in the ACT, where federal government funding cuts have driven unemployment to its highest rate since 2001. That has had a huge knock-on effect on small and medium businesses. We have essentially 50 per cent public sector employment in this town and 50 per cent private sector employment. The public and private sectors are interdependent, so if you get rid of 16,500 public servants—8,500 here in Canberra—that is going to have a huge effect on small and medium businesses in this city. I know from my business 'walkarounds' and talking to businesses that they are doing it tough. They are expecting that these tough times are going to last for some time. It has essentially been since the Abbott government was elected that small and medium businesses in Canberra have been doing it very, very tough.

Labor have a proven record of maintaining strong levels of employment. In the midst of the biggest financial crisis since the great depression, we created almost one million jobs, an increase of 10 per cent in total jobs. We know that the best way to keep up a strong economy is to keep people working. Keeping people in jobs is one of our core values.

Labor also acknowledge the key role investment in infrastructure can play in encouraging growth and prosperity amongst small and medium businesses. That is why in 2008 we created Infrastructure Australia, the first attempt in this nation to apply an evidence based approach to infrastructure. Infrastructure Australia's job is to advise the government about infrastructure projects competing for public funding. It aims to give a long-term approach to infrastructure funding, looking past the short-term political cycle.

We lifted annual per capita spending on infrastructure from $132 per person a year in 2007 to $225 in 2013. The results speak for themselves. When we won the election, Australia was 20th in the OECD for infrastructure investment as a proportion of GDP. When we lost in 2013, Australia was No. 1. We are now seeing the fruits of some of the former Labor government's infrastructure funding here in Canberra with the near completion of the Majura Parkway. The highway will allow tens of thousands of trucks to avoid the city of Canberra and it will link up both sides of the city. As a result, those trucks will be able to travel on the new parkway to the east of the city. These types of investments are crucial in providing small and medium businesses with the roads, railways, ports, electricity generators and water supplies needed to promote growth and prosperity.

Despite the Prime Minister describing himself as the 'infrastructure Prime Minister', the government is moving away from the Infrastructure Australia model. Doing that is just madness. Labor is serious about providing investment in infrastructure support to small and medium businesses. We understand the vital importance of having the right infrastructure in place to ensure success for small and medium businesses. Without that, it is not possible. We have heard from my colleague here about the challenges of that poor soul running a business with no decent telecommunications connection. It is vital— (Time expired)

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

I commend the member for Reid for this motion. I think there are no truer words than the first line in his motion that 'small and medium businesses are the engine room of the Australian economy and employment'. We in rural and regional Australia understand this particularly well given that so many small businesses are the ones that keep our small rural and regional communities operating. They are also the businesses that support local community service organisations, emergency service organisations and sporting clubs. They are the people who contribute prizes, donations or in-kind support. It is always our small businesses that are the ones providing an enormous amount of support. They are the heart and soul of the Australian economy.

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. Small and medium businesses combined employ 70 per cent of the nation's private sector workers or 59 per cent of all Australian workers. Small businesses alone—those with fewer than 20 employees—account for 46 per cent of all Australia's workers in the private sector. That is close to half of all the workers in Australia. This is why small business is so important to the coalition government and why we have made many moves to make life easier for small business.

I also want to use my time to recognise the absolute passion that the member for Dunkley, the Minister for Small Business in cabinet, has for this particular portfolio. He has been consistent in this role, starting as the shadow minister, and has taken on some very tough issues for small business in Australia. I commend him for his efforts. From our point of view, taking such a serious approach to small business as having a small business minister in cabinet shows the dedication we have. That was after a succession of small business ministers in the previous government—I cannot recall whether it was five or six.

But we do have an enthusiastic and very dedicated small business minister and he is delivering a new way for small business to interact with the Commonwealth, transitioning the Small Business Commissioner into the Small Business and Family Enterprise Ombudsman, with real powers. The minister has set up a new unit to provide specialist advice on contracts and to ensure small businesses are not at a disadvantage in Commonwealth departments' tendering and procurement processes. These are practical outcomes. Of course, the government has allocated $2.8 million over four years to deliver on this important commitment, which will help small businesses access Commonwealth contracts.

The government has also reduced the compliance burden that employers face—one of the real issues we hear constantly from small businesses when they are making superannuation contributions for their workers—by having the Australian Taxation Office take over the running of the Small Business Superannuation Clearing House. Another step has been to ensure small business people who call the Fair Work Ombudsman receive priority service, with reduced waiting times.

We will undertake the first comprehensive review of competition laws and policy in more than 20 years. I spoke about the commitment of the small business minister taking on the tough issues, and this is one of them. There is always more to do and we need to build a platform small businesses can use to succeed. Of course, that is based around infrastructure. This government is the infrastructure government, and small business needs us to successfully deliver. Small businesses need to be able to get their raw materials or inputs to their premises in a fast and efficient manner and they need to be able to get their final product out equally efficiently. Good transport infrastructure is vital, especially for small businesses whose products are exported, and there are many of those, particularly in Western Australia.

They also need access to secure power supplies at a reasonable and competitive cost. For Australian businesses to compete in the future, our focus is definitely on competitive power prices. We need IT infrastructure, and this government's plan for broadband has a strong focus on regional internet access for small businesses. The hollow internet promises of Labor have been exposed and we now have a realistic proposal for broadband into the future.

Clare O'Neil (Hotham, Australian Labor Party) Share this | Link to this | Hansard source

Like much of what the member for Reid says, there is actually very little in the motion today that I can stand to disagree with. Essentially what we have here is a series of statements of fact about how important small businesses are and how important infrastructure is to them. I think the open question for us today is the extent to which the Abbott government is living up to the high standards that the member for Reid has set for it, and I will go into some of the detail there.

But can I start by saying that of course Labor shares the belief that small businesses are the engine room of the Australian economy. All of us in this House have thousands and thousands of small businesses operating in our electorates. In my electorate of Hotham, we have more than 5,000 businesses operating, from accountants to grocery stores, online retailers to small manufacturers. These are the people who keep our local community in Hotham humming.

At a national level, we are all familiar with the statistics. We know that there are more than two million small and medium enterprises that are actively trading today. Those organisations employ more than half of the people of Australia who work today. These numbers are definitely worth celebrating. They are an indicator of the inventiveness and the creativity of Australians out there. Small business is about people in Australia, normal people, who have a great idea and have some get up and go and it is about ordinary working people owning capital. There is nothing that is more consistent with Labor's vision for the Australian economy than supporting these small businesses and helping them to be as large and as successful as they can be.

Critically, we do not just talk the talk on small business; we walk the walk. We have a very proud record specifically in this area of small business policy. I will go through some of those key reforms but I want to leave those remarks to the end, because the central thrust of the discussion that the member for Reid has instigated today is about infrastructure. I say with great respect to my good friend the member for Reid that, if he is wanting to go after Labor in a policy, then he is barking up the wrong tree by picking infrastructure. We are so proud of our record on infrastructure under the Rudd and Gill government, and we are happy to defend that record in this parliament or in any forum that the member for Reid may choose.

When we look at the plethora of policy issues on which there is a gaping chasm between the rhetoric of the Abbott government and the action of the Abbott government, it is infrastructure where we see one of the really good examples of this. Since becoming Prime Minister, Tony Abbott, the Prime Minister, has told us many times that he wants to be known as the infrastructure Prime Minister. But the simple reality is that, when Labor came to power, against every OECD country, we were ranked 20th in the per cent of our GDP that was being spent on these crucial infrastructure investments and, when Labor left office in 2013, we were ranked first out of every OECD country. In the 2010-11 budget, Labor invested $51 billion in infrastructure projects, and the crystal clear message that I want those in the gallery and those at home to take away today is that there is not one additional dollar going towards infrastructure investment that has been committed by this Abbott government.

Recently, the Prime Minister conducted this charade tour around Australia where he set about reannouncing a series of projects that Labor announced and Labor planned and Labor funded. Our guy, the member for Grayndler—who many in this country would say is the best infrastructure minister we have ever had in Australia—has called this the 'magical infrastructure reannouncement tour'. And it is not just Labor people who are pointing out this big chasm between the rhetoric and the reality. I will not go through the quotes but there is a terrific article in the Australian by Peter Van Onselen, who is of course a Liberal Party commentator. He says that really this is an area where the coalition has neglected infrastructure government after government and it has been Labor that have been the ones to invest in this important area.

What we did on infrastructure was not just about dollars; it was also about the way that we put really good, robust parameters around infrastructure investment. Under Labor, no more did these infrastructure projects get funded based on what was most politically expedient. Under Labor, it was about what fitted the policy objectives and what was going to deliver the best for the Australian economy.

Labor is not just the party for infrastructure; we are also the party of small business. Some of the highlights of the things that we did when we were in government included the fact that we were the first Australian government, I think, to bring small business into the cabinet—what an obvious move; to get that voice around the cabinet table. We brought small business onto the COAG agenda, and there were some significant changes to the tax system which saw small businesses benefit in particular. I am very proud to speak on this motion and to say that we are there for small business, we are there for infrastructure, and we are proud of that record.

Andrew Broad (Mallee, National Party) Share this | Link to this | Hansard source

Small business is not for the faint-hearted. You cannot understand small business unless you have actually run one. Whilst I have heard lots of rhetoric and words coming from the other side about how they understand small business, I wonder how many people have actually run a small business. Innovation is driven by small businesses. Small businesses take ideas and, because of their flexibility, they can take those ideas into reality. If we are going to turn innovation into productivity, we need to have a strong and robust small business sector.

My question is, though: does risk equal the reward for small business anymore in the Australian economy? Roy Orbison used to sing Working for the Man. The end of it was: 'I'm gonna be the man; I'm gonna be the boss.' But I wonder now whether we in the Australian economy have got that much aspiration and whether it is actually better to be the employee than the boss. Better outcomes can be achieved by employees than bosses in a lot of cases. We really need to consider the aspiration of people who want to go into small business and whether it is worthwhile and ensure that we create the economic framework for that to happen.

The real workers are actually our small business owners and operators. Having run a small business from when I was aged 22 and self-employed I know what it is like to have sleepless nights. I know what it is like to have to fill in BASs to ensure that your workers are well catered for.

I employed a number of people and I thought, 'This is good; I can walk around and be the boss and take things easy,' only to realise that one of my employees was not able to turn up one day, so I got on the job and worked myself, shoring 120 sheep. It was pretty hard work, but I was making sure that my workers also knew that as the owner of a small business I am also a worker.

This issue is around infrastructure. I recently heard from a member opposite that the previous government had delivered all this wonderful infrastructure and now our government are not. But that is not true in my electorate. I look at the Sunraysia modernisation project in Mildura. The previous minister for water, Penny Wong, was buying water out of that irrigation community and shutting them down. They actually had to pull up all piping work, completely shut those blocks down for five years and give water back to the government. In contrast, our government have said that we believe in building infrastructure and in putting in security for small business to function. We have committed $103 million and the infrastructure is now getting built. You can come to my electorate and see the pipes. You can actually walk down the pipes. This is real infrastructure; it is the real stuff happening. It is saying to the community that we think there is a future for your small business, for your irrigated agriculture in this community and that we are prepared to build the infrastructure so your business can have the certainty to go forward.

We have to close the gap between what a small business owner can make and what an employee can make. The gap at the moment is so much that sometimes it is easier to be the worker than it is to be the small business owner. We need to ensure that those who take risks are those who have personal endeavour and who can receive the financial rewards from small business. There is too much administration burden on small business at the moment. There is an inability to dismiss employees. Ambulance-chasing lawyers are creating sleepless nights for small business owners, wondering whether they would lose their house, when they are doing their best to create a safe workplace. There is financial and regulation insecurity. We also need to ensure that there is payment security for small businesses. It is still a good time to be in small business. I still run a small business as well as sit in this chamber here. Interest rates are low. Currencies favour Australian businesses at the moment. Sea freight rates are low.

Finally, I believe we have a government in power which has many people who both run and have run small businesses and, as I end with the beginning, 'You cannot understand small business unless you have run one,' no matter what I hear from the opposition. The coalition, made up of the Liberal Party and the National Party, is full of people who both understand and have a passion to see Australian small businesses prosper.

Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Parliamentary Secretary for Foreign Affairs) Share this | Link to this | Hansard source

I am proud to support this motion from the member for Reid regarding small business and the importance of infrastructure. But forgive me for expressing some cynicism in the irony contained in this motion, particularly given the fact that many of the government's policies have made it harder for small businesses. They have cut back on expenditure for infrastructure that supports small businesses.

In summation, the Abbott government have made it harder for many Australian small businesses. Take, for instance, their repeal of loss carry-back measures introduced by the former Labor government. This measure allowed businesses to carry back a loss of up to $1 million to one of the two preceding years in which they paid tax. This was a helpful and practical leg up for small businesses and its removal has created a red-tape nightmare for businesses in my community.

Or we can look at the instant asset write-off. Labor increased the asset write-off value to $6,500, a threshold that was in line with the cost of doing business. We now see that the Abbott government has slashed it back down to $1,000. That is hardly practical in today's increasingly competitive market. And, worse still, small businesses that submitted their tax documents under the previous regime have had to adjust them, creating another headache for business owners, who are stuck in the back office instead of being with their customers.

The Abbott government has repealed special depreciation rules for motor vehicles, which were introduced under Labor. This reform allowed small business people to write off a value of their car for doing business—another practical step that was put forward and developed in consultation with small business that this government has wiped out.

But the most disappointing aspect of this sorry state of affairs is that, while the government is making it harder for small businesses, it continues to deliver tax concessions to some of the richest Australian corporations. We have seen this government back away from its rhetoric on making multinational corporations pay their fair share of tax in Australia.

I had to laugh when I read the context of this motion about the importance of infrastructure and how an effective infrastructure network is essential for small businesses to survive and flourish. The Abbott federal government and the Baird government in New South Wales are proposing one of Sydney's biggest ever infrastructure projects. In fact, I understand it will be Australia's largest ever road infrastructure project in the WestConnex. That project will run past two of the big economic powerhouses in Sydney, located in my electorate —that is, Kingsford Smith Airport and Port Botany. But, amazingly, this wonderful new infrastructure will not connect up with Port Botany. So, here you have all of these small businesses that operate around the port in Botany—all of the logistics companies in Mascot, Banksmeadow and Botany—that are looking forward to that connectivity with important infrastructure in our community. But—what do you know?—the Abbott government has fluffed it again because the WestConnex will not connect up with the largest port in Australia. What a wasted opportunity from this government!

Electricity has been a big issue for small business, as is the way the regulation in the market works and the role of the Australia Energy Regulator in supporting transmission and distribution companies' capital increases, which have put pressure on electricity prices. What has the Baird government done in New South Wales? The Australia Energy Regulator recommended a reduction in electricity prices, and here we have the Baird government opposing a reduction to electricity prices. They come into this place and talk about supporting small businesses. One of the key price signals and one of the key costs for small business is electricity.

Government Members:

Government members interjecting—

Rob Mitchell (McEwen, Australian Labor Party) Share this | Link to this | Hansard source

There will be silence on the right.

Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Parliamentary Secretary for Foreign Affairs) Share this | Link to this | Hansard source

And here we have the Baird government actively opposing a reduction in electricity prices in New South Wales. Why? It is so they can fatten up these businesses and make them more attractive for sale through the privatisation process that the Baird government is proposing. That says everything about the Liberal Party's philosophy when it comes to supporting small business in this country and about the irony that is contained in this motion moved by the member for Reid.

Rob Mitchell (McEwen, Australian Labor Party) Share this | Link to this | Hansard source

The time allotted for this debate has expired. The debate is adjourned and the resumption of debate will be made an order of the day for the next day of sitting.