Jane Prentice (Ryan, Liberal Party) Share this | Link to this | Hansard source

As I was saying, following the budget the Treasurer and I visited one such business, Briki Espresso and Gelati Bar in the suburb of Ironside. There we met Sav Ermides, who told us that the depreciation changes in the budget will help him to expand his cafe and also buy a new oven so that he can serve more customers and grow his business. Mr Ermides is one of thousands of such stories among the 13,000 registered small businesses in my electorate and the hundreds of thousands more across Australia. This policy is already making a real difference to small businesses.

These days it is a cliche to say that small business is the engine room of the economy, but nevertheless the numbers back it up. Small businesses produce more than $330 billion of our nation's economic output every year. Better yet, they employ more than 4.5 million Australians. Businesses such as Brookfield Gardens, a family-owned garden retailer in my electorate that now boasts a restaurant addition. Robin and Scott McLay have a passion for gardening and have built a successful local business that demonstrates their passion and expertise. They are a great small business success story. Then there is the French patisserie at the Cat and Fiddle shopping centre in Toowong. They have been a family run business since 1984, making delightful pastry desserts as well as quiches that are a weekend lunch staple for my family. And businesses such as Kenmore Gallery and Picture Framing, run by well-known Ryan local Liz Barker with more than 30 years of industry experience.

As I speak to people across the electorate of Ryan, I am hearing more and more stories of new families investing in existing small businesses—a positive reaction to a recharged economy, where a more optimistic mood is encouraging people to take that step into their own business. Like Cave Coffee Espresso Bar at Keperra. It has always served great coffee and has been revitalised under new ownership. I am particularly looking forward to the planned redecoration, which will very much reflect the new owner's heritage. Fancy That Boutique, a business with a 30-year history in The Gap Village, is a fine example of an established small business that has had a new lease on life under the stewardship of a new owner. Paula Johnston, having previously had a corporate career, bought it four years ago and is carrying on the hard-working traditions of the original owners, the Watkins family, with her fabulous range of clothing. Blackwood Street in Mitchelton is experiencing a renewal with a number of businesses changing over as people retire or take up new challenges. The local post office franchise is one case in point. Mitchelton Newsagency is another, with Rod and Cathie Palmer retiring after 12 years as invaluable and energetic members of the local chamber of commerce and wider community. And there is the Taverner Lounge, where Kim and Grant Limburg have taken over and are well and truly putting their own stamp on that business. These are all fine examples of local small businesses with new owners willing to give it a go.

Ryan is an electorate full of small businesses and when one small business succeeds, then the flow-on effects boost the wider local economy. More than 90 per cent of all businesses headquartered in Ryan have a turnover of below $2 million and will therefore be eligible for the tax cuts and franking changes outlined in this bill.

If only half of the small businesses in Australia employed just one more person each, we would no longer have any unemployment problems. That is why it is so important that the small business sector be incentivised to invest and grow and why the coalition government stands side by side with small business to make it easier for them to do just that. The contrast between this government and Labor governments past could not be more stark. Labor saddled this country with 21,000 new and amended regulations, drowning the small business sector in red tape. Under Labor, 519,000 jobs were lost in small business. They had five different small business ministers in one 15-month period. Kim Beazley said it best when he admitted in 2000:

We have never pretended to be a small business party, the Labor Party, we have never pretended that.

Compare Labor's actions to this bill, which demonstrates that the coalition government is serious about sorting out Labor's mess and getting the small business sector back on the path to growth and prosperity. This bill delivers a real and immediate benefit to small businesses across Australia. I urge all members, and particularly those opposite, to do the right thing in the interests of 780,000 eligible small businesses across Australia and support this bill. I commend the bill to the House.

Bill Shorten (Maribyrnong, Australian Labor Party, Leader of the Opposition) Share this | Link to this | Hansard source

I can assure the member for Ryan that—just as we have been saying since budget night, when our shadow Treasurer said it—we are supporting the Tax Laws Amendment (Small Business Measures No. 1) Bill 2015. What a lot of hypocrisy from the government, saying that somehow there is a question mark over it. We have said we will support it time and time again. What cheap politics from the member for Ryan, who normally does not engage in that. We believe in small business on the Labor side. We certainly do. We understand there is $330 billion it contributes to the economy annually. It delivers 47 per cent of the private sector jobs in Australia. It is vital for small businesses that they have confidence. We would never do anything to jeopardise this, and shame on the government and its speakers who have pretended otherwise for the last 22 days.

Labor, and indeed Australians, are sick of being patronised by this government. The government have never seen a policy issue that they do not reduce to politics. The Australian people are not the mugs that the government take them for. We are in the middle of the biggest transition we have seen in our recent economic history, from mining investment to non-mining investment. We have no time to waste on games in this nation, and to watch this government flounder around since the budget trying to score points when in fact we are all on the same side just shows you how poor the government are at this matter. Let's forget the rhetoric. Let's put the facts on the record.

I, like most Australians, cringe when Tony Abbott says he is the best friend of someone. When he says he is the best friend of small business, I know what Tony Abbott's best friends think. I am reminded of that Norwegian artist Edvard Munch, who famously painted The Scream. When Tony Abbott says he is someone's best friend, I think of the person in that painting. He says he is the best friend of Medicare. Thanks for the GP tax, mate! He says he is the best friend of pensioners. Thanks for cutting the indexation rate, mate! Then he says he is the best friend of superannuation. Not once, not twice, but three times this government has tampered with the increase to superannuation, and it freezes it for many, many years for Australians, which means that Australian workers will be $983 billion worse off over the next 40 years—almost $1 trillion in savings denied to Australians because Tony Abbott is their best friend. And, of course, he has abolished the tax relief to 3½ million Australians. He will fight to the last ounce of his energy to defend a few thousand people, who already have multiple millions of dollars, getting a 45c tax concession. He says he will never, ever change that, but, when it comes to supporting 3½ million people with a tax refund on their superannuation contribution, Tony Abbott is not their best friend.

But, of course, when he says he is the best friend of small business, I would submit that that is false and misleading conduct, almost in breach of the Trade Practices Act. To prove that, you only have to ask working women. Remember, he was going to be the best friend that working women have ever had. Remember what he said: that he believes he is the best friend of women of calibre. Whatever happened to that commitment?

It is not just their rhetoric which makes us suspicious about what they are doing for small business; we look at the Liberals' record. When they came to office, they said—they not only said it; they did it—there would be a $3.8 billion cut to small business. That is right: $3.8 billion taken away from small business. They abolished the tax loss carry-back provisions, they abandoned the special depreciation rules for motor vehicles and they unwound instant asset write-off, a point I will come back to. In the 2014 budget, they followed up on their mugging of small business when they came to power with an $845 million cut to industry and small business programs—successful improvement programs like Commercialisation Australia, enterprise solutions and Enterprise Connect. But they were not content to stop there, these vandals; they went after the Tools For Your Trade program, with $1 billion in support for apprentices gone in the blink of an eye, and another $1 billion worth of skills and training programs was gone. They even managed to go after the Joint Group Training, which helped small and medium businesses find and retain apprentices.

Furthermore, not content with what they did in 2014 and not content with the $3.8 billion in cuts to small business that they have abandoned since they came into power, now they are actually proposing to do a petrol tax deal with the Greens. We listened to sanctimonious lectures from the government when they were in opposition—and the government certainly have the monopoly on sanctimony. They said, 'How could anyone ever work with the Greens?' Remember there was a Tony Abbott promise? I know what they are worth, but, for the record, he did actually say that he would never do deals with the Greens. Now we can see the petrol tax coming in to slug small business and the government are doing a dirty deal with the Greens to lock it in. Well done, Tony Abbott. At least we know you are consistent in your inconsistency.

The bigger issue is not just that their rhetoric does not match the reality of what they have done; it is what they are actually doing to the economy. For a year—you can almost date it; you can carbon date it from three weeks before the 2014 budget—they have suffocated confidence in this economy. They have suffocated and smothered confidence for more than a year. They have doubled the deficit between their last budget and this budget. In the time that Tony Abbott and Joe Hockey have been in charge of the nation's finances, between the 2014 budget and the 2015 budget they have doubled the deficit. They have added 17 new taxes and doubled the deficit.

Australians knew about the mining boom easing off. Australians understand that the rise of Asia provides opportunities for us, but Australians never saw the government coming at them to wreck their confidence in 2014. In 2014, this government vandalised, damaged, wrecked and mugged confidence in the Australian economy. We have stopped the harm being worse because of our strength in opposition against their unfair measures, but the issue now is that these changes to small business are a recognition that the Prime Minister and the Treasurer—and, indeed, the whole of the frontbench, including the minister at the table—have mugged Australians with their changes. Now they are putting a couple of bandaids on. They are trying to bandage up the damage to confidence they have done.

The reason why Labor is supporting the small business package is that, for us, everything is about jobs. What motivates the Labor team that I lead is jobs. We are interested in the jobs that people currently have and in people keeping their jobs. We are interested in jobs for the future. The massive failure of the government, and there is much competition for that title, is unemployment. Joe Hockey said, in that poor man's Hamlet style he likes to affect in question time, 'Woe is me. I wish I inherited an economy where unemployment had a 4 in front of it.' Well, Joe, Labor, having helped Australia get through the GFC, working with a lot of people, gave you the next best thing. You got unemployment with a 5 in front of it—and what have you done since you took over? You have put a 6 in front of it, Joe Hockey. Woe is Australia that we have you as our Treasurer. Unemployment since September 2013 has gone up, up and up again. Unemployment is the highest it has been in 12 years. The significance of 12 years, other than it is a terribly long period of time since unemployment has been that high, is that the minister for employment when unemployment was this high was none other than Tony Abbott. He is back to the scene of the accident.

Unemployment in this country is now higher than at any time during the global financial crisis—that is right. Australia had to navigate the global financial crisis. Many other countries did it very hard, and Australia did do it hard, but, because of the excellent leadership of the then Labor government and the decisions they made then, unemployment did not hit the levels it has hit under this current bunch of ne'er-do-wells. There are 130 people every day joining the back of the unemployment queue under the Liberal government. What we know when you get a Liberal government is that you get longer unemployment queues—that is what you get. There is record youth unemployment in the regions and the outer suburbs of our big cities. It will take a lot more than this small business package to fix it up.

Let me talk a little about the legislation. This legislation, which we are supporting, has a very familiar feel to it. A tax cut for small business—that is a good idea. Labor proposed it, but, when you were in opposition, you opposed it.

An opposition member: With the Greens.

And they did it with the Greens, too. Then, of course, we proposed the instant asset write-off. Labor proposed it, Labor delivered it and then, when the Liberals came into power, you undid it. Two years later, you realised what a terrible mistake you made and you have come crawling back to the people of Australia. You have not admitted any mistake—not a hint of contrition; not a hint of repentance; not a mea culpa; not even a modest admission that maybe Labor had the right idea with the instant asset write-off. For not a moment, in the arrogance of the government, do they ever say that. They are so blinded by their own born-to-rule mentality that, whenever Labor has an idea and the Liberals have realised that they had to do it, have we even got a bit of modest acknowledgement that maybe the people sitting opposite, the leakers of their own national security debates—do we ever get a modicum of an admission—are not the repository of all knowledge in this nation? Of course they are not?

How quickly they forget the changes which we introduced with the instant asset write-off. I have a little fact from Tony Abbott's little book of commitments. Actually, this is his long book of commitments; the shorter book, the sequel, is the book of promises that he keeps—that is a short book. When it was Labor policy, did Tony Abbott ever utter the words 'instant asset write-off'? Did he ever utter the words just once? In the desert of Tony Abbott's contributions in opposition, did he ever utter once the words 'instant asset write-off'? The answer is nope—nope, nope, nope. In the 22 days since the budget he has said it 36 times. As Tony Abbott understands, there is no zealot like the convert—except of course when it comes to paid parental leave; then he's a backsliding convert.

Of course it is not just the Prime Minister who is guilty of hypocrisy when it comes to small business and the members opposite. I actually have here the words of Bruce Billson, the ubiquitous Minister for Small Business. He issued a media release on 17 July 2012—of course, that was then and this is now, but what he said then, and I quote directly from the mouth of Bruce Billson, was: 'Cash-strapped small businesses won't be able to take advantage of an increase in the instant asset write-off because they don't have spare cash lying around to pay for an asset in the first place.' Another intellectual zinger from the member for Dunkley!

Bruce Billson was keen to return to the scene of this matter again, because he was consistent between 17 July 2012 and November 2013. Again he had a bit of a foray into this issue of bagging instant asset write-offs. He said this at a doorstop. You might be forgiven for thinking, 'Did he say that before the last election or after the last election?' because now this is a government of converts to instant asset write-offs. He actually said this on 6 November 2013:

… some of the instant asset write off arrangements were sold as if they were great for cash strapped small businesses but you needed the cash to start with to make the purchase.

So there we have it—Billson-the-apostle is actually Billson-we-don't-know-quite-what-he-thinks, and we don't know what he thinks and when Labor thinks it he certainly doesn't agree with it!

But, to be fair to Bruce Billson, his intellectual thought-leader, Joe Hockey, did say on ABC News Breakfast on 11 July 2011:

JOE HOCKEY:

These guys are not buying assets.

PRESENTER:

You just made a statement about small business not getting a zac. I am say simply saying that the small business asset write-off has increased. Do you concede that?

That is a pretty straightforward factual question—not a lot of wriggle room. But these guys never need a lot of wriggle-room not to answer a question.

JOE HOCKEY:

Only if you buy the asset.

Well, that is true, Joe! The lights were on that day! But he goes on:

If you don't buy an asset for a year you are not getting a zac.

Again, he is reinforcing his first point. He then says:

If you have already bought a million dollar refrigerator, what are you going to get this?

Well, to begin with he could not get the million-dollar refrigerator under this deal either!

You don't replace a refrigerator for 3, 4 or 5 years.

Thanks, Joe!

The point about all of this is that the nation and the government are entitled to be reminded of the stubborn ideology, the bleak oppositional mentality, which runs this country. There is a very small heart lurking in the very large body of this government. Whenever Labor has an idea, these people attack. They do not listen; they just attack. And of course the minister at the table, Minister Dutton, would not be prone to that, would he! I've got a bridge to sell you, if you believe that!

Labor could take the same attitude that the Liberals took in opposition. We could give them a taste of their own medicine. And we don't like to talk about medicine, do we, Minister at the table? That would remind us of health! But the reality is: Labor is actually better. We think that—all the political points to be made aside—the period that Tony Abbott was opposition leader was one of the bleakest periods of this nation. We are different in opposition from Tony Abbott and his team when they were in opposition. We are cut from a different cloth. We will judge these measures on small business not by the puerile point-scoring that we have seen over the last 22 days where the government has been engaging in some sort of existential angst—'Will they? Won't they?'—when we have already said we will. We are not the people that this government are. Labor is not into hating people who disagree with them. We are not into bullying people with their policies if we think that they actually have an idea which is worth backing in.

Mr Dutton interjecting—

Nor do we have, Peter Dutton, the born-to-rule mentality totally undeserved by these people opposite. We want to help grow the economy. We want to help grow the economy and we want to help grow jobs. But I have to sound a note of caution about this legislation. We most certainly will vote for this package, especially the increased instant asset write-off. But we do so trusting that this government has done its homework—in between leaking on each other on national security matters. We trust that this government has done its homework. We trust that the plan will be properly implemented and directed for the purpose intended. We know that, on budget night, when they made this announcement they forgot primary producers and farmers and have already had to subsequently update what they are saying to include them. But we also hope that the ATO has the resources and powers they need to make sure that compliance standards are met. We do not want honest, hardworking small businesses to miss out because there are some flaws in the scheme which allow some people to rort the scheme for purposes other than those for which it was designed.

I say to Joe Hockey and to Tony Abbott: I hope you enjoy your road trip to the Harvey Normans and to the second-hand car yards across Australia, trying to find the confidence that you lost last year. These two remind me a little bit of Jim Carrey and Jeff Daniels from that road trip film—what was it called again? Dumb and Dumber! But I hope that, as they are making that road trip, they make sure there are no unintended consequences from the implementation of this scheme, so that it does not see taxpayers' money squandered in a desperate bid by these two on their road trip to find some votes to save their jobs.

But, while we are here and we are talking about helping small business, I repeat my invitation from the budget reply speech: let us work together to reduce the tax rate for small business, to not just give a 1½ per cent cut but a five per cent cut. We understand that there is no way that Labor can do this without the agreement of the government. We understand that it could take more than the life of one parliament. But I do think that, in a spirit of bipartisanship, we need to keep talking about how we help small business.

But, in helping small business, there is a proposal on the table. We listen to Joe Hockey come into parliament in question time every day and complain about how hard his job is. We listen to Tony Abbott pretty much 30 seconds into any answer say, 'Well, can you give us the answers, because we've run out of the answers.' What we do say is: perhaps you could make multinationals pay their fair share. While you are talking to the cafes and the news agencies and the Harvey Norman franchises—indeed, while you are getting out talking to florists and subbies and drycleaners and chemists—maybe what we need to be doing is explaining to them why they pay more tax than James Hardie. But of course, when we proposed a measure to tackle foreign multinationals to make them pay their fair share, what was the response from the government as soon as we had said it? There is nothing like that Pavlovian, knee-jerk, negative response: 'If Labor says it, we're against it.' This country needs better from its politicians than the government always rejecting every idea that Labor has. We are prepared, when the government has a good idea, to back it in. But, as to the people opposite, including the minister at the table, I have never seen them say anything good about the Labor Party—and that is because they live in a world where politics is more important than policy, and where hate and division are more important than uniting this country and bringing people together.

Labor has a plan for the future. It is not like the government's love of self-promotion—the government do love their self-promotion. At least when they do it themselves it is cheaper than tricking poor old Dr Karl into doing it for them. The idea that this small business package will be the panacea for every economic challenge that Australia faces right now, and the notion that over the next two years a $5 billion temporary stimulus will be enough to replace a $100 billion contraction in investment due to the wind down in investment in the mining industry, just does not stack up. The deposit of $5 billion of taxpayers money into the Australian economy to replace a $100 billion contraction in investment really misses the big story of Australia.

The budget missed the chance to give us a long-term plan. It was just a plan to save the jobs of Tony Abbott and Joe Hockey. What we really needed in that budget was a plan beyond the mining boom—a plan for the next decade, a plan for the long run. There is no doubt that Australians are disenchanted with politics, but this government gives them no hope. We all understand about this budget, and deep in their hearts the government understands this, too: the 2015 budget was not designed to last 12 months. It is a budget sticky taped together to try to boost confidence in small business, which has been damaged by the actions of this government over the last years. It has been sticky taped, bandaided and rubber banded together, and it will not last 12 months.

We see that the big questions for the future are not being addressed by the government, and that there is no economic plan. No wonder Australians are confused about this government. In 2014, the government said that there was a debt and deficit crisis—that we were drowning in a debt and deficit crisis. This year, there is more cash to splash around than people have seen in a long time. This government is inconsistent. They are political chameleons. Chameleons, in nature, take the colour of the environment they are in to camouflage themselves. In 2014, the Tony Abbott chameleons camouflaged themselves in the rhetoric of economic austerity. They were going to sort things out—a debt and deficit crisis. Now, in 2015, the chameleons have taken a different approach. They are trying to pretend that they are economically fair. Tony Abbott does not understand that fairness is not a domain name you can buy on the internet. It has to be something that you believe in every day.

When we talk about the future, we understand that Australians expect more and deserve more from their government. They want a plan for long-term confidence and sustainability; a plan to accelerate jobs growth and encourage business investment. They want a plan to unlock our cities and towns. They want to see support for public transport. They want to see a cut down in the hours that Australians are spending commuting to and from home. They want a plan to equip our children, and indeed to retrain adults, with the skills and knowledge to seize and create the opportunities of the new economy. This means, as Labor has said, more children studying coding and computational thinking in primary school—and, no, Tony Abbott, studying coding and computational thinking in primary school does not mean that you go to work when you are 11!

We want to see more competent, skilled and inspiring science teachers in our secondary schools. We want to see more Australians—more women—enrolled in engineering at uni, or technology at TAFE. We want to create a culture of innovation and risk taking. We do not want this country dumbed down to the Liberal three-word slogans. We want to encourage Australians to turn their good ideas into great businesses. We want a smarter, more productive competitive workforce for all employers, and we certainly want to fund our innovative small businesses. We want to see support for Australian's start-ups, entrepreneurs and innovators.

Labor will create a $500 million Smart Investment Fund for backing great Australian ideas. The Smart Investment Fund will partner with venture capitalists and fund managers, investing in early-stage and high-potential companies. It is a model with a definite, proven track record of success. We have created jobs, growth and innovation before. Australia can do it again.

Australians want more from their government than this bleak vision of unfairness rebadged—this dodging of the big issues in the taxation system, and support of small business, without a long-term plan to build confidence to deal with the skills and the infrastructure of the future. Because we back small business, we will also work with the banks and the finance industry to help establish a partial guarantee scheme—Start-Up Finance—to help more Australians to convert their great ideas into good businesses. We will enable entrepreneurs to access the capital they need to start and grow their enterprise. Before we hear the standard government knee-jerk reaction of 'no, no, no' to this, please have a look at what the UK, the US, Germany, France and Hong Kong do, before you do what you are so good at doing and give a knee-jerk, negative reaction. Start-ups and innovators will drive growth and create jobs. We take responsibility, on the Labor side, for supporting our next generation of designers and refiners, manufacturers and creators.

Every day since the budget, the government has come into this place and demanded that we vote for legislation that they have not yet moved. Six times, the Prime Minister, the Treasurer and the minister have stood at the despatch box and urged us to vote for a bill that they had not even brought into the House. We made it clear on election night—Chris Bowen on television, and me the next morning when I bumped into Tony Abbott in one of those awkward moments that you have at the ABC. I said that I did not like what he was doing on health and education—and who does, let's face it—but I said that small business looked good. We said it again in the budget-in-reply, and we have said it every day since. But do you think this government is so addicted to trying to create divisions in this community? They want small business to not like Labor, even though we are supporting small business. They are so determined to divide this country. They have no capacity to unite this country. They are people addicted to the view that there are good people and bad people, and they are constantly adding to the list of bad people. So we say to the government, and I say to Tony Abbott, enough is enough. Enough playing of the silly political games that are your trademark.

We are not going to delay this legislation for one minute longer. We were always going to vote for it. We always said we would support it. Let's get on with it. Therefore, this is why, I move:

That the question be put.

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

The question is:

That the question be put.

The DEPUTY SPEAKER (10:33): The question now is that this bill be read a second time.

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

I rise today to support small business. From this side of the parliament you will not hear any negative rhetoric, bullying, hypocrisy, personal attacks and whingeing that we have just heard from Australia's biggest whinger. And there will be no cheap stunts. In fact, it is quite ironical that we just heard from Australia's biggest whinger when we are about to introduce the biggest small business package in our nation's history and the lowest small business company tax rate in almost half a century. This government understands the important contribution small business makes to the Australian economy. The Tax Laws Amendment (Small Business Measures No. 1) Bill 2015 and Tax Laws Amendment (Small Business Measures No. 2) Bill 2015 lower the company tax rate by 1.5 percentage points, to 28.5 per cent for incorporated small businesses with a turnover of less than $2 million. This is the lowest small business company tax rate since 1967.

We believe in Australia's small businesses and acknowledge that government can do more to support and encourage greater growth. This government is building a stronger and more prosperous economy so that every Australian can get ahead. At the foundation of a strong economy is the need to support small businesses. We need to provide more support for entrepreneurial Australians who are looking to create Australia's new innovative jobs. The government is supporting eager young people with new ideas and mums and dads who are prepared to wager the family home to start a new business. These are the building blocks of our stronger economy and future prosperity.

Small businesses will pay less tax for income years that commence on or after 1 July 2015. This fulfils our 2013 election commitment. Unlike members opposite, who had a budget night epiphany about the importance of small business, this tax break has been a long-held commitment of the government. Sadly, rather than congratulating the government on our achievements, members opposite sought to politicise the announcement and also have a cheap stunt.

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

We have congratulated you.

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

Thank you. It is good to hear more congratulations on the positive things that this government is doing. Small businesses remember how Labor treated them when they were last in government and how they did not get a tax cut. They got a jobs-destroying carbon tax. They did not get an accelerated depreciation on assets; they got a confidence-eroding mining tax. And they did not get red-tape reduction; they got a burdensome and costly red tape. That is the difference between this government and the opposition. Members opposite should know better than to try and deceive our small business community.

The small businesses of Australia hold the key to our future prosperity. Approximately 96 per cent of all Australia's businesses are small business. Collectively, they produce over $330 billion of Australia's economic output and employ over 4.5 million people. This represents almost 43 per cent of non-financial private sector jobs in Australia. I am a passionate supporter of small business because I appreciate just how much they contribute to our economy. This is particularly true in regions such as the Central Coast where, collectively, small business is our largest employer. This package will assist the electorate of Dobell's 8,707 businesses to invest more, grow more and employ more. The government is well aware that slow economic growth is impacting on the labour market. Unfortunately, this is leading to increasing unemployment in some areas, such as the Central Coast, having a severe impact on the employment prospects of our youth.

While it is businesses which create jobs, there is a need, albeit limited, for government to reduce the impediments and encourage the right conditions for Australia's small businesses to grow and become more productive. Since my election I have been working alongside small businesses in my electorate of Dobell to identify and address the barriers that prohibit growth and employment opportunities. This government acknowledges that small businesses are typically more vulnerable to changes in economic conditions than larger businesses.

As our economy is currently in a state of transition it is essential that government policy supports small business growth and innovation. Reducing the tax rate for more than 90 per cent of incorporated businesses with an annual turnover of under $2 million is definitely a 'game changer'. This will benefit 8,283 businesses in Dobell, which is 95 per cent of all businesses in Dobell. Providing small businesses with a reduced rate of company tax will allow them to retain more earning for investment and increase cash flow. When speaking with local small business operators I ask them what they would do if they had more cash flow, and I am frequently told that they would grow their business. Small businesses understand he important role they play on the Central Coast, and they want to grow and provide new employment opportunities for locals. Increased cash flow means small businesses are better placed to create new jobs. This may mean a new admin assistant to assist the owner with paperwork, allowing the owner to concentrate on growing their business or even take a well-deserved break—many small business operators do not even have the chance to have a family holiday—and it may mean the first job opportunity for a young job seeker.

In addition, small businesses with an annual turnover of under $2 million will be able to immediately deduct each and every asset costing up to $20,000 that they purchase between 12 May and the end of June 2017. Cutting the company tax rate will cost the Commonwealth approximately $1.45 billion over the forward estimates, but this translates into a $1.45 billion injection into the Australian economy. In 2013-14, Australians started over 280,000 small businesses. Our $5.5 billion Jobs and Small Business package will create the right conditions for small businesses to thrive and grow. Members on the side of the parliament understand the importance of transitioning people from welfare to work. Every Australian who is capable of working should have the opportunity to do so. These measures will assist small businesses to create new jobs and help Australia's unemployed to access these jobs.

As I stated previously, providing incorporated small businesses with a reduced rate of company tax creates more cash flow. This is essential to ensuring that a new small business can survive and prosper. This will benefit 780,000 small businesses nationwide. In 2014 we saw the highest level of new company registrations on record. Businesses both new and old can have renewed confidence that they can grow, thrive, prosper and compete. New accelerated depreciation arrangements will particularly benefit new start-up businesses, which face greater up-front costs. The Herald Sun reports that small businesses plan to purchase new computers, tools, phones, work cars, technical equipment et cetera. These new assets will boost business productivity and innovation, allowing growth and the creation of jobs.

These bills will also ensure that the maximum amount of franking credits a small incorporated business can attach to its dividends in a year will not be reduced along with the tax rate. By doing so, we are allowing small companies to distribute surplus franking credits accumulated in previous years, reducing the tax their owners pay when they receive dividends. This will benefit owners of small businesses and effectively reduce the overall tax paid by shareholders, regardless of their marginal tax rate.

In the lead-up to the 2013 federal election, small business proudly proclaimed that they were ''too big to ignore'. This government agrees with them. We believe Australia is the best place to start and grow a business. This government knows that the best way to create jobs is to build a strong and prosperous economy. This knowledge was lost on the former Labor government. Dobell's small businesses were particularly hit by the economic mismanagement of the former Labor government. In 2013 TheDaily Telegraph reported that 'more businesses had shut their doors in Dobell than anywhere else in New South Wales'. This was a damning indictment of the former Labor government and totally unacceptable.

Over the next 15 years the Central Coast is expected to grow by 100,000 people. Our region will need an additional 45,000 new jobs to address the employment needs of this growth. This simply will not happen without strong small business. Small businesses in Dobell now have a new lease on life. Small businesses will be better placed to generate local employment in a region where over 38,000 people commute out of the region daily for employment. We will see more jobs created for our youth, addressing the ongoing youth unemployment issue that has afflicted the Central Coast for many years. This is real action for small business that will deliver real outcomes. I look forward to continuing to work alongside Dobell's local businesses to expand their opportunities and increase the prosperity of everyone in our community.

I commend the bills to the House.

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

How embarrassing it must be for the government to come into this place, after carrying on ridiculously for 22 days, saying Labor must get out of the road and support the budget's tax measures and small business package. This is where the rubber hits the road, this is where we are right now: we can do it immediately. Let's not waste one more minute. Let's get on with the job. If Tony Abbott and the government say that want to support small business, then Labor says let's get on with it, let's do it. Today will be the 23rd day that small business have had uncertainty from this government. They do not get the tax measures that are in the budget. This government is holding it up. This is the 23rd day, yet they come into this place every day saying Labor should do everything it can to support these measures.

Well, here we are. The test is right before us, right now. Let's have them all come into the House. Let's not talk about this ad infinitum. Let's do it right now. Let's support small business. Let's support the tax measures that are in the budget. We just gave the government that opportunity—no more talk; talk is cheap. Let's vote on it and let's do it right now. We moved to put these bills before the House, to put the motion, to give small business the certainty they need, because their certainty and confidence is being destroyed. For 22 days this government, Tony Abbott, has been talking down the possibility that this just might not get through the parliament. 'Let's get a lot of uncertainty out there', the Liberals say. 'Let's make sure we scare the living daylights out of small business. Let's make sure we get out there and create the uncertain environment that small business certainly does not need.' I will come back to that point in a minute and tell you about what that uncertainty has done over the past two years that this government has been in and the damage that has been done to our economy and to small business.

So, no more of this false 'We support small business' and the rest of it. How embarrassing it must be to have to speak on this. Why are you going to waste the parliament's time speaking on this? Why? Let's just put these bills. You can speak about this to your small business friends all the time.

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

Sit down and get on with it!

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

Well, I would sit down if we put the bill. You are going to get up after me. The member interjecting has a lot of hide, because he will get up after me and he will be wasting the time of this parliament when we could have these bills done. What hypocrisy and what irony.

This is where the rubber hits the road. This is where you actually get to show your real colours. We do not need to hear from you. We do not need to hear from all the other Liberals. In fact, let's vote on it right now. Let's get it done. Let's pass these bills. I am just going to grab the speaking list here and have a little bit of a look. I have done a quick summation of how long it will take for the parliament to get through this speaking list—22 days of this government just bleating and yelling at small business: more uncertainty, breaking more confidence down. And the government is not in a hurry to pass these bills; they are just not in a hurry. There are eight hours worth of speakers on this list. We are not going to get through this today. We are not going to get through this tomorrow. We are not going to get through it this week.

Such is this government's urgency to have these bills passed that we are probably not going to get to them for another fortnight. That is how urgent it is. For 22 days Tony Abbott has been standing up every day and saying: 'Oh, the uncertainty; oh, the worry of small business. They must be just so worried and uncertain that perhaps Labor won't pass these bills through parliament. How can people get up in the morning? Small businesses have risked their mortgage and their lives. We need to give them certainty.' Well, I agree. Labor agrees. Labor will pass these bills. In fact, we will do it today. If you want to get the certainty through the House of Reps today, let's get it in the parliament. Let's decide. We can do that today. Let's just cut this short. I am happy to speak for all of my time, and I know everyone in this place will be as well. But I think a lot has actually been said about small business. It certainly was when Labor was in government, because we did some real things for small business—something that the government has only just discovered. The Liberals have only just discovered this instant asset write-off. It has been around for a little while. In fact, it was Labor's policy, Labor's initiative. It was what Labor put in place. That is what we did when we got to government. We did not go making a great big song and dance about it and carrying on. We knew what had to be done. We had to work hard in a difficult time, a global financial crisis. We wanted to support small business, we wanted to support the economy and we wanted to support jobs, because Labor understands that there is no greater certainty in life than having work.

Look at our record on jobs and unemployment during a time of great difficulty. The global financial crisis was very real and had an enormous impact right across Europe and the United States and here at home in Australia. But Labor stood up and did the things that needed to be done: underpinning jobs, underpinning growth and making sure that small businesses did not close their doors—and they did not. We did that through a whole heap of measures, including—wait for it—instant asset write-off. Why did we do that? Because it was really important. You would have thought that at the time Liberals, in opposition—being the bastion of small business; they love small business and are the best friend of small business—would have supported it. Who cares who put it to parliament, whether it was Labor of Liberal? I do not care who put it to parliament; it needed to be done. But what did the Liberals do in opposition? They voted against the small business package then. They spoke against it. In fact, now Minister Bruce Billson, who was then in opposition, spoke against it. Just recently Bill Shorten, the Leader of the Opposition, detailed some of the quotes of the minister shaking his head and saying, 'Oh, this is bad; oh, this is no good.' Well, how is it any different from what is before the parliament right now?

So, I would ask that we not spend the rest of the day—and we will not get to it today. Question time is at two o'clock, and the day must come to an end at some point. We have eight hours worth of speakers, and there is a long list of Liberal speakers who want to speak. Well, good on you; congratulations. And they want to hear 'congratulations', so let me say it again: Labor will support these bills. Congratulations for introducing something that was well and truly overdue, because you did such a bad job on your first budget, Joe Hockey and the Liberals, such a bad job. You destroyed so much confidence. You did so much damage. You had to lift your socks and do something. Well, I would have been glad if I had seen a new idea. That would have been really good—something new.

But I am not too worried about whether the Liberals come up with new ideas or old ideas, as long as they are good ideas. Isn't that what is important, good ideas? Let's support the good ideas. I do not care who has put them forward; I will support them, and Labor will support them. That is what we are saying here today. That is what we are doing. Labor is not standing up and doing what is expected or what the Liberal opposition did, which was vote against it not because it was anything bad or wrong but just because it was a Labor idea. Well, here is the chance to turn the tables today. The Liberal government now gets a chance to vote for its own small business budget measures. We say, let's do it. Let's put it to the parliament immediately, because Tony Abbott is running out there every day scaring small business, creating more uncertainty—22 days of it, we have had. For 22 days we have had Tony Abbott come into this place, go outside and talk to small business, saying: 'We've got this great package that will do you so much good,' but 'The uncertainty— the worry, the fear that maybe Labor will not pass these bills.' For 22 days we have said we will pass these bills.

This is day 23. Let us pass the bills. Labor supports the small-business-package bills, every single one of them. Tax Laws Amendment (Small Business Measures No. 1) Bill 2015: Labor supports it and will pass it, and we will do it immediately. If the government had half a brain, the next speaker would get up there and say, 'Thank you. Let's get on with and pass these bills,' and give the certainty that the Liberals keep telling small business they need. Let us give them that certainty.

Labor will support these bills. Put the bills to the parliament. Test us. Test Labor that we will support these bills. Will support. We will support Tax Laws Amendment (Small Business Measures No. 1) Bill 2015. We will support these bills. Why won't the government? You cannot have it both ways. Generally, in life, that is how things go. You cannot come into the parliament, create more uncertainty and lack of confidence in our economy, telling small-business people they have this fantastic package coming, but then make sure you create uncertainty. Accountants are telling their small-business clients, 'We're not sure. Just in case, don't go doing anything yet. Just wait. We're uncertain. We're not confident about this, because Tony Abbott is telling everybody that this just might not pass parliament. This might not get through.'

Let us end the uncertainty. Let us not have this charade, this farce, of the government saying that somehow this bill will not pass. Let us pass them today. Let us get on with it today. What hypocrisy, what irony, what embarrassment. How can this mob, how can the Liberals stand here and look people in the eye, small-business people, who will be asking them: 'Why didn't you do it today? Why wait and delay for one more day?'

What is the strategy? What is the cunning plan? What is the strategic advancement for small business to not have the certainty today? It can be done today. Given the certainty, let us pass it here. Labor will support it. Labor will support these bills. Labor supports small business. Labor will support the budget measures it contains for small business. Why is it that this government is the only one not supporting it?

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

You said you're going to support it. They have certainty now.

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

Red-faced with embarrassment, they try to throw back some interjections. They are embarrassed because today they stuffed up. You need to have a bit of a forward think in this place. Occasionally, when a government puts forward its own bills, somebody just might say—a really good opposition, like Labor—'We agree with you. Let's do it. Let's vote on it now.' And they go, 'Hang on; no. We won't vote on our bills.' We will. Let's put the bills to the parliament. I think people get how that works. The Liberals voted against their own bills. I am wondering how they are going to explain this to small-business people.

Peter Dutton (Dickson, Liberal Party, Minister for Immigration and Border Protection) Share this | Link to this | Hansard source

Bernie, you're embarrassing yourself.

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

The Liberal Party voted against their own small-business-package measures. What really is embarrassing in this place is that after more than 22 days you mob still do not vote—

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

We are going to vote for the package, trust me.

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

Always gonna. The Liberals are gonna, gonna. Today, we did a 'did a'. Today, we actually put it to you—and you voted against it.

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

I'll explain to you how business works, mate.

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

You fool! You voted against your own package. Let us restore some confidence. Let us get this place functioning like it is meant to be functioning. Small business cannot wait any more. That is the reality. It is Wednesday today. They cannot wait till Thursday, because that is what you tell them every day. Every day there is more uncertainty. Every day you have another go at small business, making their lives difficult. When they go to see their accountants, their accountants say, 'No, don't make these decisions today. There is too much uncertainty.' Tony Abbott loves nothing more than turning up to small coffee shops, somewhere locally, shaking his head and saying, 'It's a worry. We are not sure what's going to happen. We are so uncertain.' He's asked, 'But isn't Labor supporting these bills?' He says, 'We'll see when these bills are put to the parliament.'

Guess what? They were put to the parliament today. Labor voted for the bills in support of small business. The Liberal Party voted against them. We have just had it. It will be in the Hansard. It is on the record. Every single one of them voted against it. Most of them were scratching their heads and going, 'What are we voting on?' I saw some ministers running around, frantically, asking 'What's going on? What are we voting against? Surely we can't be voting.' They are the government. Governments do not vote against—governments vote for. It is their bill. You do not vote against your own bill, you vote for your own bill.

I will not get into the detail of consumer confidence, because we have talked about it in this place so much. The numbers are a disaster.

Peter Dutton (Dickson, Liberal Party, Minister for Immigration and Border Protection) Share this | Link to this | Hansard source

I'll bet you won't! That's a cracked mirror for you, Bernie.

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

The minister thinks he is really clever by saying, 'You do not want to talk about that.' I do not want to talk about it anymore than has already been done, because small business needs to be uplifted. Let us have a bit of uplifting, in this place. Let us have a bit of lifting of confidence. Let us have, for once, the simplicity of the government saying, 'The small-business budget measures are good. Labor thinks they are good. Labor will support them.' Labor will get on with it. We are not standing in the road.

How many more days? I am counting the days: 22 days; 23 days. We are not going to get through it this week, so it will be 25 days, 26 days and 30 days, and the government still will not have passed its own measures. When will the government step up to the plate? When will the government do the right thing by small business ? When will the government restore confidence? When will the Liberal Party and the National Party stand up for small-business people in this country? When will they pass their own bills? Let us tick off how many more days we have to wait for the government to pass its own bills. Labor stands here ready, right now. Pass the bills.

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

The member for Oxley has just proved an important point. He has proved you can talk for 15 minutes without saying anything. I understand—as he leaves the chamber—his complete embarrassment, because the member for Oxley, if I remember, was the parliamentary secretary for small business during the previous Labor regime. I will come to that appalling record, so it is no wonder he is scurrying from the chamber and does not want to hear about the appalling record of the Labor Party during its six years looking after small business. What we have seen this morning is just a simple, cheap, tardy stunt. For those following the debate here, we have a speakers list. Probably 20 or more coalition speakers wish to speak on this bill. Labor's cheap stunt today was simply to silence all those speakers, to silence them so as not to give them the opportunity to speak and to raise their issues on the importance of this bill.

I will go back to the bill, the Tax Laws Amendment (Small Business Measures No 1) Bill 2015. One of the most important speeches ever given in this country was 'The Forgotten People' speech by Sir Robert Menzies, not only for its content but for the time when it was given, in 1942, in the middle of the Second World War. Sir Robert talked about the kind of people he represented in parliament. He called them the salary earners, the shopkeepers, the skilled artisans, the professional men and women, the farmers and so on. He said:

These are, in the political and economic sense, the middle-class. They are, for the most part, unorganised and unself-conscious. They are envied by those whose benefits are largely obtained by taxing them. They are not rich enough to have individual power. They are taken for granted by each political party in turn. They are not sufficiently lacking individualism to be organised for what in these days we call "pressure politics." And yet, as I have said, they are the backbone of the nation.

He finished the last line of 'The Forgotten People' speech, by saying—and it is as true today as it was back then:

But what really happens to us will depend on how many people we have who are of the great and sober and dynamic middle-class—the strivers, the planners, the ambitious ones. We shall destroy them at our peril.

It is worth looking at how many of those people were destroyed by the previous Labor government and their anti-small-business policies. We saw a revolving door of small business ministers. At one stage the previous Labor government had had no fewer than five separate small business ministers in 18 months, none of them in cabinet. We saw a decline in the number of small businesses in this country and an incredible number—519,000, over half a million people—who were employed in small business when Labor came to office were no longer employed in small business by the time they had left office. Over half a million jobs were lost in the small business sector under the six years of policies of that previous Labor government. We also saw the small business proportion of private sector employment decline, from 52 per cent to 43 per cent. You could not have had a greater destruction of small business in this nation than that which occurred under the previous Labor government, and especially also under the previous speaker, the member for Oxley, who was parliamentary secretary for small business during that appalling regime when we saw such destruction.

But the real destruction was the decline in new start-up businesses under the previous Labor government. In 2012-13, their last full financial year in government, we saw the numbers of new start-up businesses decline by over 100,000. If we compare that to 2003-2004—a decade earlier—we see that the number of small start-up businesses declined by 100,000. We had more businesses exiting the economy than we had entering the economy under the policies of the previous Labor government. The number of start-up businesses we get in the economy is probably one of the most important economic indicators. We can see from the numbers the confidence that the small business sector has got simply by removing the Labor government from office. In 2014, the first full year of the coalition government, we saw the highest number of company registrations on record. Small business knows who to trust when it comes to the economy simply on the track record of the policies of the two parties.

We saw Labor's real attitude towards small business when the Leader of the Opposition was in here this morning. Everyone well remembers his foray into that North Carlton pie shop and his gratuitous attack upon that small businessperson over not having a warm pie sums it up completely—not the 500,000 jobs lost, not the decline in small business employment within the private sector, not the massive decline in start-ups in the economy. The single attitude in that pie shop sums up Labor's approach to small business.

There are several reasons why small business is important for the economy. We know it is important for job creation, because it is small business that creates most of the new jobs, so invigorating small business is what we do need to do to get unemployment numbers down. We also know that it is small business that drives the innovation in the country.

Small business getting in there and experimenting, taking risks, using their entrepreneurial skills, testing new products, new methods of business and new ways of doing things—that is how we create the innovation in this country. That is how we get our productivity increases. That is what history has shown. If we look at the largest companies in the world today—Amazon, Apple, Disney, Google—they all started as small businesses working basically in a garage from home. That is why we need the encouragement for small business to get out there to create tomorrow's Apple, to create tomorrow's Amazon. They will be one of those small businesses out there that we have to incentivise and to encourage to take those entrepreneurial risks.

Another reason why small business start-ups and encouragement of small business is so important is that, for decades throughout this country, small business has been the gateway for new migrants to assimilate, integrate and get their roots into this community. We are seeing something quite unique in this nation's history—for the first time we are seeing second and third generation Australians turning against our nation. With previous generations of migrants, the first generation had some difficulty settling into the country, but the second and third generations have settled in well and have contributed enormously to make this nation a better place. If we do not have opportunities for those new migrants to set up and start into small business, what we simply do is make it easier for the terrorist recruiters to alienate that second and third generation. That is another reason we must get out and encourage small business.

These bills are an important step, but there is still a lot more that we must do. We have, unfortunately, competition laws in this country that are anti small business. There is no provisions against anti-competitive price discrimination. They protect and provide privilege to the larger incumbent players. One example of how out of touch our competition laws are is a comparison with the Canadian Competition Act. The very first section of that act sets out the purpose of the act. It says:

Its purpose is to maintain and encourage competition in Canada in order to:

• promote the efficiency and adaptability of the Canadian economy

It goes on—

…   …   …

'Small and medium sized and enterprises have an equitable opportunity' are words that are not seen anywhere in our own competition act.

Then we have the banking sector. The Reserve Bank prints a list of historical indicator lending rates. It goes back quite some time and from about 1996 they start to separate the lending rates charged to large and small businesses. If you look back through these historical comparisons, there was a loan from one of our major banks to a small business, which was secured by a residence where the owner of the business had put their house on the line, so if the business failed the bank could step in and take the owner's house. When you compare that to what was loaned to large businesses there was very little difference for many years. In fact in some cases the rate of lending to small business was actually less than it was to large business. That should only be natural because the loan to the small business is actually secured by residential property. As we go through the list, year after year we see the gap, the differential, between what the banks loan to small business compared to what they loan to large business continue to blow out. In the latest figures small business are paying perhaps 260 basis points or more to borrow money from the banks than are their larger competitors, even though that loan is residentially secured. That is one of the great factors we have against small business in this economy.

Another factor is around shopping centre leases and rents. In any major shopping centre you will see large chains, supermarkets, paying perhaps three per cent of their turnover in rent because of special deals. But the small business competitor is paying up to 20 per cent of his turnover in rent. Just imagine the outcry around the GST if one company was paying three per cent and another company, selling the same product, had to pay 20 per cent. That is exactly what we have with the distortions in the retail rents and the protection from competition in our shopping centre industry.

The other factor is our legal system. How can a small business, today, take on a large corporation in a dispute before the Australian courts? There are two ways that they can get beaten. They can get beaten on the facts, but in most cases they can get beaten simply because they run out of money. Other competition laws have provisions for triple damages. We used to have a triple damage provision, going back to the old Industries Preservation Act. We cut that out in the sixties. It was another anti-small-business step.

These bills are one of the important steps to levelling the playing field for small business, and to incentivise our entrepreneurs to get out there and to take risks. What they do is lower corporate tax rate from 30 per cent to 28.5 per cent. I would like to make a prediction. Treasury estimates that the corporate tax reduction will cost the budget about $300 million to $400 million every year. My prediction is that, when the dust settles and we do the final accounting on this, it will not cost the budget a single cent. I speak that from history for every single time in this nation that we have lowered the corporate tax rate, as have both Labor and Liberal governments in the past. We have lowered it from 49 per cent all the way down to the current level of 30 per cent. Every single time we have lowered that corporate tax rate the Treasury has had more taxation revenue flowing into it from the lower tax rate and also more tax revenue as a percentage of GDP. If you lower those tax rates, you create greater incentive for investment and the government ends up in a better position. I believe that, when we look at the numbers in perhaps 18 months, or two years, or three years, we will see exactly the same thing from this taxation rate reduction. My prediction is that the government Treasury will get more taxation revenue from small business at 28.5 per cent than they will at 30 per cent. Mark my words, Deputy Speaker. I thank the House.

Jim Chalmers (Rankin, Australian Labor Party, Shadow Parliamentary Secretary to the Leader of the Opposition) Share this | Link to this | Hansard source

I take this opportunity to speak on the Tax Laws Amendment (Small Business Measures No. 1) Bill 2015 and related bill. The Australian people need to understand what just happened in their House of Representatives. Every small business around the suburbs and towns of our nation needs to understand what just happened when it came to the opportunity to vote on these important small-business measures. Every small business in the electorates of the members for Moreton, Hughes and Farrer needs to know that the Liberal Party of Australia, after breathlessly spruiking these policies for weeks, voted against their own legislation being put. They were so desperate for division on this issue that they voted against their own bills. As I sat there listening to the contribution the Leader of the Opposition made earlier on to this debate, I thought that surely the Liberal Party of Australia will not vote against their own legislation. I was wrong. They did vote against their own legislation. I watched them walk in here, one at a time, and come over and sit on this side of the House and, amazingly, vote against the small-business measures that Labor thinks are very important to the future of our economy. Even the Minister for Small Business himself did so. It was a humiliating spectacle to see the Minister for Small Business vote against his own legislation. After going around the country—he began as a figure of fun and ended as a figure of ridicule—he voted against the bills that he himself put before the House of Representatives.

In question time, day after day, the government—whether it is the Prime Minister, the Treasurer or the Minister for Small Business—stand up and say, 'Labor must absolutely support our small-business measures,' failing to understand that on budget night itself, when the ink was not yet dry on the budget, Labor said that we would support the small-business measures in the budget. But they were so desperate for division on this issue, so desperate for conflict and a fight, that they either did not know or did not care that Labor has said all along to the small businesses of Australia that we will support this legislation. That proves the government has a political strategy but not a strategy for small business and for the broader economy. Have a look at some of the things they said about passing this legislation. In question time on 1 June 2015 Tony Abbot said:

I say to the Leader of the Opposition let us not let politics get in the way of economics. Let us not let self-interest get in the way of national interest. Let us pass this bill straight away.

That was the Prime Minister of this nation, this week. That is what he said about how important it was that the bills get passed straight away. We moved for that to happen. The Liberal Party voted against it. There is quote after quote of Liberal Party ministers saying we need to pass the bill straight away. Joe Hockey said:

So here is a challenge for the Labor Party. This legislation is going to go through the House of Representatives this week. Then it goes to the Senate. I lay down the challenge: Help us get that legislation through as quickly as possible.

Well, we have. And again, they have shown that they put politics ahead of the economy of this nation. The member for Hughes said to look at their real attitude to small business, and I think what happened this morning really did shine a big spotlight on their real attitude to small business. Small business, for the Liberal Party, is secondary to their political strategy—to their hunger and desperation—for there to be division and disunity in the House of Representatives and, indeed, right throughout the country.

Labor supports these bills because we support small business. We want to reward the effort of people who take chances. We want to reward the effort of the entrepreneurs in this country. We want to reward their effort and their enterprise. We want to give them every chance of success. That is why we have said all along that we will vote for these measures. The member for Parramatta, who joins us at the table, has been a big supporter of these measures because she is a big supporter of small business in our country. Everyone on this side of the House believes that we need to do all that we can to help and assist small business to create jobs and wealth in this country so that we can be a successful economy into the future.

Other speakers have spoken about the two main measures in these bills. The first one, of course, is the company rate tax cut and the second component is the instant asset write-off, which, in my personal opinion, is the better part of the suite of policies. I speak of the instant asset write-off with some experience, having played a small part in the government that introduced it. The Labor government introduced an instant asset write-off during the dark days of the global financial crisis, and it was a tremendously successful policy. The feedback we got from business was very positive, because it did help small business to make the investments they need in small-scale capital to succeed and to be wealth-creating, job-creating small businesses in this country. I really think that it speaks volumes about the government that they had abolished the instant asset write-off before then reinstating it. They did not just abolish it straightaway; they rubbished it as well. There are quotes, and the Leader of the Opposition went through some of them—whether it is from the Minister for Small Business, the Treasurer or others—saying that the instant asset would not work. We disagree with that. It was a tremendously successful policy then, and I expect it to be a successful policy now. That is why I want to support it. That is why I voted for it this morning. It is a real shame, a real source of embarrassment, for the Liberal Party that they could not find a way to support the instant asset write-off this morning.

Let us have a look that at the sorts of things that the Minister for Small Business has previously said about the instant asset write-off. On 17 July 2012 he said:

Cash-strapped small businesses won't be able to take advantage of an increase in the instant asset write-off because they don't have spare cash lying around to pay for an asset in the first place.

After the election, on 6 November 2013, he said:

Some of the instant asset write-off arrangements were sold as if they were great for cash-strapped small businesses. But you needed the cash to start with to make the purchase.

I do not agree with the views the Minister for Small Business has expressed about the instant asset write-off. I am pleased to see he has gone back on some of these views, but it is worth noting, for the record of the parliament, the hypocrisy of those opposite, having bagged and abolished a measure, and reinstated it, expecting the country to applaud them and pat them on the back for reinstating a successful Labor policy that we support wholeheartedly.

We all represent communities with fantastic small businesses. Many of us have 10,000 or more terrific small businesses in the communities we represent. In my case, I have 10,746 of them. More than 60 per cent of them are sole traders—people working for themselves. But there are more than 4,000 of them who employ between one and 19 additional people in their business.

I want to specifically salute them because they are a much needed source of jobs in my community, and we should not beat around the bush: jobs are not that easy to come by at the moment and my community has had persistently higher unemployment than the national average. So I salute the small businesses in my community. I salute the Logan Chamber of Commerce—Bill Richards and his colleagues—that represents them so ably. Every single small business in my community is doing the right thing by the country. They are taking risks. They are showing an entrepreneurial spirit. Many of them are employing more people from my community, and I pay tribute to every single one of those companies.

Why is this so important? The economy is going through a period of below-trend growth. Very shortly—indeed, in about seven minutes time—national accounts for Australia will be released, and they will give us a good snapshot of the last three months of economic activity. But, in the last year or two, it is a fact not an opinion that the Australian economy has been going through a period of softer growth. There are a couple of reasons for that and there are some manifestations of that. One of the reasons that the Australian economy's growth is softer than is ideal and softer than trend growth is that there has been a dramatic drop-off in confidence in the economy.

If we just take consumer confidence is one example, at the 2013 federal election, consumer confidence was recorded by Westpac at 110.6. It is now 102.4, and it plummeted into the low 90s after the 2014 budget. So we do have a confidence problem in the Australian economy. It is made worse by the Treasurer, in this place, comparing us to the economy of Greece and all kinds of other damaging rhetoric, which is having a real impact. As the Treasurer of this nation, what you say matters. When he gets up and says that the Australian economy is like the Greek economy, people in the business community listen, and when they hear that, it damages confidence. It damages investor confidence and it damages consumer confidence in our economy.

That means that we have higher unemployment than is ideal. It is a stunning fact that the unemployment rate today, under this government, is higher than at any point under the previous government, and remember that the previous government dealt with a global financial crisis. The sharpest synchronised downturn in the global economy since the Great Depression happened under Labor's watch. The unemployment rate then was lower than it is today. Having diminished confidence in the economy, having done all they could to trash confidence around our community, the least that the Liberal Party could do is to vote for their own small business bills so that we can get things in train to get that legislation in place and pass them the instant asset write-off and the lower company tax rate. But, again, the political strategy of those opposite trumped what the economy needs and, specifically, what the small businesses of this country need.

On this side of the House we want an economy that is powered by aspiration and powered by enterprise. We want people who take risks to be rewarded for those risks. We want people to take a chance. We want people to aspire to employ more Australians. Certainly, in my community, as I said, we can do with all the new jobs created, so what we need to do is support sensible measures like these. Whether they were drafted initially by the Labor Party or not, we need to get together as a parliament and pass them.

We had an opportunity to do that this morning, and those opposite missed it. It should be a source of acute embarrassment for those opposite. They could not even vote for their own small business measures this morning, because they were so desperate for division and disunity in this place. If they were fair dinkum about small business they would have voted for their own small business legislation. That they did not speaks volumes about that political approach. It speaks volumes about the character and the strategy of the Prime Minister, the Treasurer and the small business minister that when they were given that opportunity they could not take it.

This is a government that always elevates the cheap political hit over the long-term benefits of the Australian economy not just in small business but right across the board. The way that the Prime Minister has shamefully attacked our idea to teach coding in primary schools is another example. His instinct always is to attack, to diminish and to divide the country. So his immediate reaction to our sensible policy to teach kids the language of the 21st century is to diminish it and to bag it, even though, right across the country, the parents and the teachers of Australia know that it is something that is needed, and there are so many more examples of the way that they go about rubbishing any idea that does not come from a Liberal Party focus group.

This is a divisive budget. This is a divisive strategy from a divisive government. It was proved again this morning by those opposite. Every small business in every community should know that when given the opportunity to vote in the interests of small business, the Liberal Party of Australia left them high and dry.

Ian Goodenough (Moore, Liberal Party) Share this | Link to this | Hansard source

These related bills, the Tax Laws Amendment (Small Business Measures No. 1) Bill 2015 and Tax Laws Amendment (Small Business Measures No. 2) Bill 2015, seek to amend the Income Tax Assessment Act 1997 in respect of companies with a total turnover below a $2 million threshold, firstly, to introduce a new tax rate of 28.5 per cent, which applies to the taxable income of qualifying small businesses and, secondly, to permit these qualifying entities to claim an immediate tax deduction for eligible productive assets costing less than $20,000 each. Nationally, small business generates $330 billion in gross domestic product, employing 4.5 million Australians. There were 280,000 small business start-ups in 2013-14. Small business provides 40 per cent of all jobs in the private sector, 60 per cent of jobs in the construction industry and 80 per cent of the employment in agriculture. Nearly 4,000 new jobs each week were created within the economy during 2014, equating to quadruple the rate of employment growth experienced in 2013. Since the start of this year, approximately 79,000 new jobs have been created, bringing the total to around 250,000 jobs created since the coalition government came to office.

Since the budget was announced in May, leading indicators have shown an increase in consumer confidence. The Westpac bank monthly consumer confidence index rose by 6.4 per cent, whilst the ANZ-Roy Morgan index rose 3.6 per cent in the week following the budget. Both indices are trending above their long-run average levels. Job advertisements remained strong. As measured by ANZ bank, the number of employment advertisements has risen in 10 of the past 11 months. Furthermore, retail trade figures have risen for 10 consecutive months, export volumes are now up 7.2 per cent on a year ago and residential building approvals are up 16.3 per cent over the past 12 months, remaining at near record levels.

As the Australian economy becomes increasingly connected with international economies through globalisation and free trade, our competitiveness increasingly matters. It is true to say that Australia's economy is more heavily taxed in comparison with those of emerging economies in our region, putting Australian businesses at a strategic disadvantage. The coalition government realises this and is taking appropriate action to ensure that the Australian economy can be more resilient and compete internationally on a more level playing field.

I researched the comparison between Australia's corporate taxation rates and some of our closest regional trading partners to assess the competitiveness of our nation in the global economic marketplace. Figures sourced from the global tax rates table published by international accounting firm KPMG reveal that Singapore has a company tax rate of 17 per cent; Thailand, 20 per cent; South Korea, 24.2 per cent; and Indonesia, China and Malaysia, all 25 per cent. The OECD average is 24.77 per cent, the Asian average is 21.91 per cent, the European Union is average 22.15 per cent, and the global average corporate tax rate is 23.68 per cent. This illustrates that, if we are to remain competitive in attracting investment capital to develop our economy, we must keep our tax rates low. Previous tax reviews, including the Australia's Future Tax System review, have suggested that there would be benefits from a lower company tax rate and that government should continue to reduce tax rates as fiscal circumstances permit. According to OECD statistics, 11 of its 34 member countries have a differential corporate tax rate for small business.

These taxation reforms are much needed to make our business environment more competitive and to attract investment into Australia. In order to take advantage of the economic opportunities presented by free trade agreements, the government must ensure that our taxation system is efficient and flexible enough to permit Australian industry to prosper. The coalition government has a strategy to encourage Australian businesses to take advantage of export markets with the emerging economies in our region, facilitated by free trade agreements with Japan, Korea, and China. Trade is projected to continue expanding as a free trade agreement is expected to be reached with India and as Australia develops stronger economic partnerships with the 10 member countries of the Association of Southeast Asian Nations, ASEAN: Indonesia, Malaysia, the Philippines, Singapore, Thailand, Brunei, Cambodia, Laos, Myanmar, and Vietnam.

The budget contains $5.5 billion worth of initiatives designed to promote small business investment, growth and employment. It is estimated that some 90 per cent of incorporated businesses, representing 780,000 small companies, will be eligible for the 1.5 per cent reduction in the company tax rate, the lowest rate for small business since 1967. In addition, a five per cent tax discount will apply for the estimated 1.7 million small unincorporated businesses, providing a cut of up to $1,000 for sole traders, to give them similar incentive. On the other hand, more than 95 per cent of Australian businesses will be eligible for the instant tax deduction on productive assets of up to $20,000 in value purchased from 7.30 pm on 12 May 2015, which will encourage businesses to invest in tools, plant and equipment to raise output.

To support our agricultural sector, the budget provides $300 million in drought assistance for struggling farmers. In addition to the small business tax cuts, accelerated depreciation is provided for investment in water facilities, fodder storage assets and new fencing. All primary producers will be able to immediately claim a tax deduction on capital expenditure on fencing and water facilities such as dams, tanks, bores, irrigation channels, pumps, water towers and windmills. Farmers will also be able to depreciate over three years all capital expenditure on fodder storage assets such as silos and tanks used principally and primarily to store grain and other animal feed. The accelerated depreciation arrangements are expected to improve resilience for primary producers facing drought, assist with cash flow and reduce red tape by removing the need for primary producers to track expenditure over time.

Like many of my colleagues on this side of the House, I come from a small business background. I started out in business with an $85,000 loan and, over 18 years, built my engineering supply company into a leading supplier of electrical, mechanical and pipe support systems to the commercial construction and mining industries. My company has made a lasting contribution to Western Australia by supplying iconic projects such as the new Terminal 2 at Perth Airport, the Graham Farmer Freeway tunnel, the Whitfords City and Lakeside shopping centre expansions, and the Perth Convention and Exhibition Centre, to name a few. As my company grew, I reinvested the retained profits into a commercial and residential property development business, which recently completed a district shopping centre project. I have experienced firsthand the challenges of being in business: employing staff, managing inventory, organising production, cash flow and paying the bills.

These tax reforms are a welcome boost for small businesses in my electorate of Moore, whose collective interests are represented by the Joondalup Business Association and the Wanneroo Business Association. Local businesses are experiencing the effects of falling commodity prices, the slowdown in the mining industry and the ever-increasing cost of production. It is therefore important for the government to implement policies which help to contain the cost structure of doing business.

This legislation needs to be passed by 1 July 2015 so that a lower tax rate of 28.5 per cent for small business can take effect from the start of the new financial year. The Treasury has consulted with the Australian Taxation Office in order to identify any implementation issues and integrity concerns with the proposals, as well as any potential flow-on impacts they might have within the broader tax framework. The tax rate reduction measure will cost the budget $1.45 billion over the forward estimates. On the other hand, the instant asset write-off scheme will cost the budget $1.8 billion over the forward estimates, with accelerated depreciation costing a further $70 million. It reflects an election commitment in the coalition's policy for small business.

This budget delivers for families, for small business and for our economy. It is responsible, measured and fair. It cuts taxes, will create jobs and delivers a responsible pathway back to budget surplus. I commend the bill to the House.

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

A number of years ago, before I was a member of parliament, I was running my own business, and I was headhunted by a man called David Williams who runs Shock Records, who turned out to be one of the great negotiators of all time because he managed to convince me to take on the management of the national association of independent record labels on a percentage basis when it had five grand in the bank and 20 members. He managed to convince me to do that and I did, and, a number of years later, it was representing virtually 95 per cent of the sector and it had five staff. But, during that time, I spent a lot of time in this place and in government departments lobbying for things that my sector needed in order to do well, and one of the things that you always wanted, as a person who represented an industry and represented a small business, was for whatever thing you were arguing for to have bipartisan support. The last thing you wanted ever was for something that mattered to small business to become politicised because, when it did, uncertainty developed. The timing blew out, sometimes to years. It came and went. Uncertainty ensued. So, for us, it was always a case of trying to find members of the public service to work with and avoiding working with politicians until the last moment until you had support—trying to keep things as bipartisan as possible for as long as possible.

In all the meetings I have had with similar organisations since I came to this place—and I have had three in the last week with representatives of various small business associations—there is a single thing they all ask for. They ask for all sorts of things—sometimes the same thing; sometimes different things—but they always ask for one thing: 'Can you make this bipartisan?' It is the single thing that they all ask for, because they want the certainty. And I usually say: 'Well, we'll see what we can do. But there is not a three word slogan in it, so I am hopeful,' because we know that, if the government can find a three word slogan, they will make it political. And many, many things that business wants should actually be pursued in a bipartisan manner because both sides of government believe that small business is incredibly important and needs the support of this parliament.

Having watched what has happened in the last two weeks, particularly about the instant asset write-off, I am not so hopeful anymore, because this is an area of policy that we do agree on. We have agreed on it since it was presented on budget night. On budget night, the Leader of the Opposition said: 'We support that.' He said it the next day. In the budget reply he said: 'We support it.' And we have said it every day since then. And yet, for the last 21 days, we have had government members going out and trying to convince the small business associations and the small businesses out in their communities that there is doubt about this legislation—that somehow Labor might not support it; that the government is the friend of small business, and Labor is the enemy and might bring this great policy undone before their very eyes. Every day they have gone out and done that. And in this House they have gone out and done it. On 1 June, Tony Abbott said:

With the economy in transition, it is important that these budget measures to help small business get through the parliament as quickly as possible, some small businesses are reluctant to invest until the measure has passed the parliament. I say to the Leader of the Opposition, let us not let politics get in the way of economics. Let us not let self-interest get in the way of national interest. Let us pass this bill straight away.

On the same day, Joe Hockey said:

So here is a challenge for the Labor Party. This legislation is going to go through the House of Representatives this week—absolutely right. Then it goes to the Senate, which has only two weeks to sit. I lay down the challenge to the Labor Party: help us to get that legislation through the Senate as quickly as possible.

Bruce Billson on 26 May said:

The only thing people are uncertain about is whether Labor are going to muck around with this. Are they going to stand in the road?

Time after time in the last two weeks we have seen members of the government get up and say: 'Labor might not support this. There is doubt. Be fearful. Be worried. Put off spending. Put off using this until we are certain that Labor won't get in the way.' They have stood here in this House and they have said it—even though, on budget night and the day after, and in the budget reply and every day after that, we on this side of the House have been totally clear that we support it. This is an extraordinary turn of events—a government that claims to be about certainty, and claims to be for small business, in a case where there is bipartisan support for a policy, cannot help themselves but try to find some political weapon to use. It is as if Tony Abbott's three-word slogan is his character: 'No, no, no. We cannot get on with this. We have to find some way of manoeuvring this and making a political benefit.' It is quite extraordinary.

Today we have seen, perhaps, the culmination of it. Having asked over and over again in this House for a commitment from Labor to support it—even though we committed to support it—when we get up and move that the motion be put and say 'let's get on with it; let's just pass it now', they vote against it. Most of them were confused, by the way. I am not sure all of them knew what they were voting for, but they voted anyway. We asked that the motion be put now, that it be voted on, that it be done. It could be done now. It could have been done yesterday, by the way, when it was on the Notice Paper, until the government decided to delay it a day. Who knows why? There might be a news cycle or something that will be in their favour. It was scheduled for yesterday; they moved it to today; they have delayed it 24 hours; and now they are delaying it for probably another 24 hours, because there are eight hours worth of speeches on this list. It could have been passed this morning. It was not, because the government decided that they did not want to pass it straight away. Having argued for it, and having stood up in this House day after day saying they wanted to pass it straight away and Labor was in the way, it turns out that it is exactly the other way around—Labor was prepared to pass it this morning; they are not. They want to delay it for as long as they can, presumably for some political advantage, in their minds, that we might see play out today somehow—who knows? It could have been passed. It has not been.

The reason you can be absolutely certain that Labor was going to support this—you could have been pretty much certain before we even knew about it—was that it was Labor's policy. Labor introduced an instant tax write-off for small business when it was in government. The current government, when in opposition—Tony Abbott, Bruce Billson, Joe Hockey—all argued against it. They said it would not work. They said that business did not have the cash; that it would not work; that it was bad. They argued against it—all three of them. They argued against it in 2011. They argued against it in 2012. They argued against it in 2013. Then they were elected, and they abolished it. They stood in this House, and in the Senate, and they abolished the instant tax write-off that Labor had introduced, because they thought it was a bad idea—it was bad in 2011, 2012, 2013, and it was bad in 2014 when they abolished it retrospectively. Labor argued to keep it. We thought it was good policy. Labor argued and fought to keep the instant tax write-off in place, and the government argued to abolish it because they thought it was bad. So having now changed their minds, and decided it is actually a good thing after all, you would think they would know that Labor had thought it was a good thing all that time, and that we would support it. We did, and we did support it.

Here we have a government that jumps to its feet to claim credit for reinstating something they had abolished the year before and argued against for three years. With incredible front, they are now claiming the moral high ground and blaming Labor for the uncertainty on this—even though small businesses, probably for nine months, were unsure whether the bill abolishing it would go through parliament. Then it was done retrospectively.

It is a similar story on the tax cut for small business. Again, it is a good thing and something that Labor supported on budget night and the day after, and in the budget-in-reply we said we wanted to work in a bipartisan way and go further. That seems to be a pretty strong indication that we support a business tax cut for small business—we said we wanted to go further. Yet, again, we have had the Treasurer, the Prime Minister and the Minister for Small Business in this House trying to create uncertainty in the small business sector, as if Labor, somehow, were not going to support this. It had been our policy when we were in government. We tried to introduce a small-business tax cut when we were in government. Guess why it did not happen? Because the then opposition thought it was a bad idea and they argued against it. They did not want to do it. In opposition they did not want to do it, but now, miraculously, they have changed their mind and they are trying to tell people that Labor is standing in the way. Small business could have had this tax cut three or four years ago if the opposition had not stood in the way. They could have had it three or four years ago, and we could now be talking—as Labor wants to—about where you go from there. The government, when in opposition, stood in the way of small-business tax cuts—not Labor. We wanted to do it for years. They argued against it. It was a bad idea because it came from Labor. If it comes from Labor, it must be a bad idea, as far as this government is concerned.

We hear a lot in the media, and from this government, about the difficulty of governing when you do not have the numbers in the Senate. I want to spend a few minutes talking about that because it really is disingenuous for this government to talk about the difficulties of getting stuff through this House. There were two parliaments in the history of Australia that had, perhaps, the most difficult Senates around. One was the Whitlam government, who we all know. Whitlam did not get anything through—no legislation through—without the support of the opposition. Every single thing that Whitlam did, and that you remember him for, that required legislation, had to be negotiated through with the opposition—every single thing. Kevin Rudd was the same. People do not realise that. When the government gets up and carries on about what Kevin Rudd did when he was in government—the numbers in the Senate were such that the Liberals had the numbers. So everything that Kevin Rudd got through the parliament, he had to get through with the support of the opposition. It is called negotiating. And yet, he managed to get 95 per cent of his legislation through, because he negotiated. He treated the opposition with respect. He talked to them. He made sure the work was done ahead of time, and he actually got it done.

This government plays the politics at every single moment. This government plays politics with every single issue. It is even playing politics with something that we have agreed to. They could not even accept bipartisan support. They could not even accept that an opposition could get up and say, 'We support this.' They had to try to turn that around for their own political gain. It is truly extraordinary. It is because of that politicking that everything they touch turns into politics rather than government. Because everything is about politics, and not governance, we see this extraordinary decline in business confidence over the last two years. We can see it from day one. We can see business confidence figures start to fall from the election. They freefall—as down and down and down they go—from the 2013 election. Immediately after the first budget, down they go again.

So it is not surprising that we see a government that has to try and do something to bring confidence back. But the way to bring confidence back is to bring it with certainty: 'There's going to be an instant tax write-off; the opposition supports it. That's great. Let's get on with it.' Let's get on with it this morning. Let's get on with it. Don't go out on a travelling circus tour in your high-vis vest or whatever and make sure that business is as uncertain as possible because you tell fibs—and I am being very generous about the opposition's position. We have been clear on this. Let's look at where we are because of the uncertainty and the politicising of everything by this government.

In the wake of last week's capex figures, we can see that private capital expenditure data for the March quarter fell by 4.4 per cent. It is 11 per cent down since the federal election. It is recession rates. It is at recession levels. Capex has collapsed. Unemployment is up. They inherited an unemployment figure with a five in front of it; it now has a six in front of it, and it is going up. It is projected to go up every year of the forwards. This is the legacy of this government.

We have seen business confidence fall down and down and down. With this measure, which is designed to boost business confidence, we see it rising slightly, to about the level it was immediately before last year's budget. So, again, when you look at the trends, it is really quite a flat-line trend. There is an incredible amount of work to do to boost confidence in the business sector.

I say to the government: if you want to do that, you do not go out for your own political ends and create uncertainty where there is certainty. You are already creating uncertainty. You have created it in the renewable energy space. You have created it in the car industry. You have created it in the many small businesses that support the submarine industry. You have created it in the childcare sector. You have created it with GPs and with community pharmacists. You name it, you have created uncertainty.

This is in an area in which you had certainty; this is an area that required certainty in order for it to have the stimulatory boost that you wanted it to have. You had certainty and you had agreement; and you went out and, in a wilful way, trying to create uncertainty where there was none. That is an extraordinary thing for a government to do.

You did it in opposition. You did it effectively in opposition, to the detriment of the country. But you do not do that in government. Stimulation requires certainty. You had it. You destroyed it.

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

In the remarks of the previous speaker there was a lot of talk about politics, but the majority of the speech was directed exactly that way. So it was contradictory in itself. In relation to small business, if you are in business—and in small business in particular—and you are looking down the barrel of $123 billion in deficits and $667 billion of future debt, which is what the previous government left for us, it really makes you reconsider your plans in business.

Small businesses are a key driver of Australia's economy, underpinning growth and innovation and providing jobs for millions of Australians. The measures in this bill give even greater confidence and encouragement to the small business sector. These are the people who have a go every day in our communities. Small business is our priority, and that is very clearly demonstrated by the bills before the House today.

I really want to acknowledge the persistent efforts of the Minister for Small Business, Bruce Billson. I want to acknowledge his passion and dedication to this portfolio. There is no substitute for either passion or dedication; whether you are the minister or one of those small businesses out there working in and on their businesses every day. They have a lot of challenges. But that is what they do. They are persistent, they invest their own money, and they have a go. We are encouraging them to do that through these bills.

Small business knows that they have an absolute warrior on their side in this minister. He has been the epitome of persistence both in opposition and now as the minister. They can see the fruit of those labours here in these bills. And it is not before time.

During my time here, during the Labor years, they played musical chairs with the portfolio. I forget whether it was five or six ministers for small business, but it was something like that under the previous Labor government. And, unfortunately, Labor treated becoming a minister for small business like drawing the short straw. That was shabby, dismissive treatment indeed.

We have a totally opposite approach. The coalition government's Small Business Minister is in cabinet and is part of the Treasury portfolio; we are literally putting our money where our mouth is when small business is concerned. For the first time in Australia, small business is at the table every time decisions are taken. It is not enough to simply mouth the words 'we support small business' like a throwaway line from the other side. The government must actively deliver policies that foster and grow small business, as we are doing, in part, through these bills.

Small business is more important than ever in the Australian economy.

Mr Matheson interjecting—

Mr Champion interjecting—

I hear the disrespect across the chamber for small business—that is appalling—in this debate. Small business is more important than ever in the Australian economy. As we are all graphically aware in this place, the Australian economy is in transition and faces structural challenges from both domestic and international factors. Mining investment is now detracting from GDP growth. The move to broader based growth is happening, and small business is a key part of this growth. These are the people who literally invest their own money and have a go. So we need small businesses to have even more confidence to invest and grow, and to employ even more workers, because small business employs nearly half the workforce in Australia.

Often, the first job opportunity a keen young person has is in a small business. The owner of that little business, often in a small community, gives that young person a go. We also see—particularly out in my electorate—that the last job a mature-age person has is also in small business, where that owner once again, gives that mature-age worker a go.

I see this over and over in my electorate. There are at least 12,716 small businesses in my electorate. And, of course, they are even more important with below-trend economic growth, which has driven increased unemployment, especially youth unemployment

So what we are facilitating through these bills is each one of these small businesses that gives a young person a go. We know that a combination of factors such as low interest rates and the falling Australian dollar will encourage employment and business growth over the longer term; there have been positive signs already that this is happening, and we have seen job advertisements increasing.

This government's Growing Jobs and Small Business package is the biggest economic recognition of the small business sector in Australia's history. Make no mistake about what we are offering. We are offering the lowest small business company tax rate in almost half a century—in fact, since 1967. We are cutting the corporate tax rates from 30 per cent to 28.5 per cent for small businesses with an annual turnover under $2 million. Not only that, we are offering the same incentive to unincorporated small businesses. We are doing this through a discount of five per cent, or up to $1,000, for the 1.7 million small businesses that are unincorporated, giving them the same incentive. We recognise their contribution and the contribution ahead. We are providing accelerated depreciation arrangements to small businesses and primary producers that are also small businesses. We are simplifying depreciation rules in the tax laws, to increase the threshold for immediate deductibility from $1,000 to $20,000. Farmers will be able to immediately deduct all eligible capital expenditure on fencing and water facilities. Fodder storage assets will be deductible over three years.

Our budget measures reflect our very deep understanding of the complex nature of small businesses across our country. Small businesses have the advantage of being adaptable and flexible. They are able to change and respond, often profitably, to a range of changing circumstances. Studies indicate that small businesses are often the entities that test and pioneer innovative ideas and business practices. They are critical to future economic growth, job prospects and improved living standards, and they will literally have a go. They invest their own money, and they have a go. They mortgage their homes, as we have heard repeatedly, and they take huge risks.

While small companies play a significant role in the Australian economy, they also face a unique set of operational challenges, often having higher failure rates than those for larger companies. Again, they often have a go and take a risk. Sometimes it can be their second or third go. It does not deter them: they learn each time, and they have another go. Often access to finance is an issue for them. Funding for small businesses is essential for productivity, growth and job creation. Improving small business access to finance is a key part of what we are doing.

I was in Augusta recently and came across a fellow who had moved into the community. He was opening up a new fast-food outlet—it was a fish and chips store. He had put all of his capital into it. He is having a go. He knows what the local economy is, but he is still having a go. I take my hat off to every one of these small businesses. I meet them everywhere. They are in every field; they are in every one of my communities—Nannup, Dunsborough, Margaret River or anywhere throughout my electorate—bailing up the local economy. I see that these small businesses are often the ones that support local charities, not-for-profit organisations, local sporting groups and sporting clubs. They donate prizes; they support our local communities.

Because I live in a small community, if it was not for those small businesses in my part of the world investing their own money and having a go, I would have to travel for at least 40 minutes to get what I need for my dairy business. But those local businesses front up in my electorate, they employ local people, they open their doors and I can get in there and get what I need. It is a huge challenge for them in small communities all of the time, but they still offer that opportunity to people like myself. That is why I am particularly pleased to see the support that we are providing to the farming sector through these bills. We are delivering support to farmers, farm businesses and rural communities, because small businesses matter in rural communities.

Each single business matters, and every time we lose one, we lose part of our community. We lose people who are involved in our community, as small businesses and small business people are; they are an integral part. Often it is the local small business where the local community gathers in their own world, and they fix the problems in the world. The small business offers them that opportunity. You see it frequently. Even in a little place like Myalup at the general store, the local people will go down there each morning, pick up their papers and talk to the local business owner. They sit there and talk about the affairs of the day, and it is that small business that helps to hold that community together. That is so underestimated around Australia—the fact that small businesses are a key part of our local communities, particularly our rural and regional communities. So the assistance to primary producers—to be able to claim more favourable accelerated depreciation for water facilities, fodder storage and fencing from July of 2015—is very important for those in the rural sector. These are really down-to-earth practical measures that they appreciate, and the measures allow them to get on with what they do really well.

I support the bill before the House, but in doing so can I acknowledge once again the huge commitment made by small business. It is hard to understand unless you have done it yourself, and unless you have actually put your home and your future on the line. You do not sleep at night when you have a massive debt, as I know from experience. One small problem in your business can cause massive problems, and you may not survive. Let me tell you that every there are those who will tell you that you are not going to survive. My husband and I know it well. We had $12,000 worth of equity and $118,000 on the day that we married, and everybody said, 'You will fail'. Well, we did not, but it took a lot of hard work. It took an absolute focus on our business, on income generation and on keeping control of our costs. When I talk to small businesses, I know that that is what they do every day. That is why I am pleased that we have not only a minister who is passionate and persistent but a government that is, as well.

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

It is a good story.

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

I rise to support this bill, the Tax Laws Amendment (Small Business Measures No. 1) Bill 2015, and support it wholeheartedly. I note the member for Forrest was talking rather wistfully about some of the businesses in her electorate and how they form the real heart of the community. I remember, when I was a young lad growing up in Kapunda, Reg Rawady owned the local deli, which had exactly that role. Rawadys Deli was a mixed business in Kapunda, and it was where people would come and chat. Of course, it was a good business as well.

Indeed, I see good businesses all over my electorate. When I am back at my electorate office, I often go across to Jack's coffee shop in Munno Para and have a talk with Mark. Mark is an ex-employee of Bridgestone, so he knows something about working in a big industrial environment; of course, it has been a big change for him to go into business for himself. He never lets me pay for coffee, unfortunately! He is certainly make a go of it there and he is always busy whenever I am there. Similarly, Dave and Lisa over at Forty Winks in the Munno Para shops, are a great local small business. They are great supporters of the Elizabeth footy club and of the local community. We know that there are so many people out there putting themselves on the line and creating good businesses that employ other people. Whenever I have had an issue with my car, I have always sent it along to Smithfield crash repair, to Larry and the boys, and they do a very good job.

There are lots of small businesses throughout my electorate, including farming businesses and businesses in small country towns and regional centres like Gawler, throughout Salisbury, Elizabeth and Munno Para. They all deserve our praise and admiration because, obviously, they put a lot of their own capital, as well as their own labour and their own ingenuity and effort into those businesses, and they employ so many people. They are really active and good corporate citizens in the local community, which I think is terribly important.

That is why it is so disappointing—when you have people out there doing the right thing and looking to Canberra, as they look to their state capitals as well, for a bit of support, a bit of consideration and a bit of acknowledgement—that, here in Canberra, political games are being played with their futures. In this government's first budget, we saw the demolition of Labor's small business package. Instead of bipartisan support, instead of bipartisan consideration, we saw the demolition of Labor's small business package, the one that we had when we were in government. That package was $5 billion worth of support for small business in terms of taxation considerations which we had put in place as part of our response to the global financial crisis and to the post-GFC economy. Part of our package was to try and spread some of the benefits of the resources boom that was going on at the time. But what did we get from those opposite? As the Leader of the Opposition said, we got a pavlovian response because Labor had promoted it, put in place and legislated for it. Whatever you might say about the last Labor government, legislatively the Rudd and Gillard governments were some of the most productive governments in this country's history. They really did push through a lot of legislation that was good for the country. Some of that was about small business and some of that was repealed by the current government.

So, what do we have in this 2015 budget? We know how much trouble the government and the Prime Minister were in, out there in the community. Having smashed consumer confidence, having smashed small business confidence and having smashed the Australian economy, knocked it for six, they then had to turn it all around and try to reinvigorate the Australian economy. What we see in this budget is, in some instances, the reintroduction of Labor's package and, in others, some support for small business, lowering tax rates and the like.

Since those measures were announced in the budget, we have had, on the one hand, the government demanding that we pass these bills and, on the other hand, the furious response from the opposition, saying, 'Yes, we'll pass them.' On budget night, the shadow Treasurer indicated our support for these bills, for these measures, and gave them bipartisan support—because we do not have that sort of pavlovian opposition response; we have a commitment to this country and to what makes this country great. We all know the figures for how much is invested and how many people are employed, and how important those investments and that employment are to our local economies. You do not have to spend much time in the community to know how important that contribution is. People rely on these businesses.

Before the bill was even in the House, we had the Prime Minister demanding that we pass it. On 1 June 2015, he said:

With the economy in transition, it is important that these budget measures to help small business get through the parliament as quickly as possible—

they are key words, 'as quickly as possible'—

as some small businesses are reluctant to invest until the measure has passed the parliament. I say to the Leader of the Opposition, let us not let politics get in the way of economics. Let us not let self-interest get in the way of national interest. Let us pass this bill straight away.

'Let us pass this bill straightaway.' But what happened this morning? Labor moved that the question that this bill be read a second time be put right away, this morning. It could have been passed. It could be on its way to the other place. And it would have had a speedy passage through the other place, too, due to the bipartisan support. We would have had none of the shenanigans with the crossbenches, none of the haggling or the horse-trading. We would have had bipartisan certainty for small business. And what did the government do? The government voted against putting the question. It voted against passing the bill! We had this bizarre spectacle where the Prime Minister demands that we pass a bill and then his party votes against that proposition. It is pretty strange!

Mr Deputy Speaker, you could have thought that maybe there was a bit of confusion there—maybe there were some crossed wires somewhere along the way. But look at what the Treasurer said in question time on 1 June:

So here is a challenge for the Labor Party. This legislation is going to go through the House of Representatives this week—absolutely right. Then it goes to the Senate, which has only two weeks to sit.

That indicates an urgency, doesn't it? I will continue the quote:

I lay down the challenge to the Labor Party: help us to get that legislation through the Senate as quickly as possible.

Well, the quickest way to get it through the other place would be to pass it through the House of Representatives promptly—not to have a long list of speakers, as we have on this bill. A long list of windbags from those opposite, who want to talk about this stuff rather than getting on and doing it—getting on and passing it.

And then we had the small business minister, who was lauded in the member for Forrest's speech. On 28 May he said:

The legislation is in this place. Let's get it through this place in a hurry and let's see if Labor is true to its word. It is not about the backswing; it is all about the follow-through. Let's follow through and get these measures enacted.

These are great sentiments. I see the minister at the table nodding enthusiastically. We all think that this place should be productive; we all think we should get on with it. And yet what did they do this morning? They voted against pushing this bill through the House of Representatives and into the Senate. They voted against bipartisanship. They voted against certainty. They voted against productivity in this place.

If you were out there working in a small business you would have to scratch your head. You would think, 'Well, why don't they just get on and do it? What's going on here?' Mr Deputy President, I will tell you what is going on here with the Prime Minister and his ministers: they operate from this song sheet—this bit of political strategy—'We are prepared to put our own political interests ahead of the national interest and, in this case, ahead of small business interests'. They could not care less about the national interest or small business interests where they conflict with their political interests.

And their political interests are Nixonian. They are all about division, all about partisanship and all about dividing the country, trying to squeeze out a small electoral majority. They could not give a damn: if it is 50 plus one then that is enough. They will even be satisfied with less than the popular vote so long as they can win those marginal seats. This is a quest for power at its most rank and most basic.

And we saw it this morning, this sort of Orwellian bravado from the government, from the Prime Minister, from his ministers and from the Treasurer. Orwellian bravado: pass the bill, pass the bill, pass the bill! We kept on demanding that they put it in the House. Pass the bill! And yet when it comes to this House, and when the opposition leader provided bipartisanship and offered to put the bill, what did we have? Not just opposition on the voices but a division—a division in this place about whether we should put the question, put the bill, pass it through the House on its way to the Senate and on its way to certainty and to being law. Instead, we are going to have to listen to a bunch of drones from the other side, droning away for half the day and half the night. They are all positive contributions, I am sure, if we had time for them!

This is a bunch of people standing around the front bar of the local pub in the country, talking about how they are going to fix the world but never actually getting to work. They never actually get out there on the farm. They are a lot of 'gunnas'. You have heard of that before, haven't you, Minister? 'Gunna'?

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

Yes, 'gunna'.

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

'Gunna do this; gunna do that'?

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

Gunna shearer!

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

Gunna shearer! Of course, it has confused those in the fourth estate too. Mr Deputy Speaker, imagine you were a journalist. You would be scratching your head, because they had all these demands, this Orwellian bravado and this beating the chest. We always get that out of the Prime Minister. That there is one in every town. He is a good talker and you think, 'Oh well, you know, I guess he must be right. He's saying it with such forcefulness. He's so adamant; he must be right.' And then you find out he is wrong, and you think, 'Oh right. I wonder how that's going to go?' Then the next time he is so adamant again, and he is wrong. Sooner or later you work out that a man's word is his bond and that you have to be careful with words.

Those in the fourth estate, those up in the gallery, know. We know what Phil Coorey thinks. He has an article online, 'Government declines Labor offer to pass small biz tax package'. That is a headline. That is a headline you would not have expected to see. You would have thought that those opposite, after all the quotes, the hoo-ha, the bravado and the beating of the chest—'We're gunna to do this, we're gunna to do that,' all those 'gunnas'—would have taken up the offer of bipartisanship. You would have thought they would take up the offer for certainty. You would have thought they would have had this bill through this House. And if ever a guillotine should apply, it should apply on these measures because there is broad agreement on them. There is no need for the drones from the backbench to drone on for a day and night. We should pass this bill and have no more Orwellian division and no more of this 'Gunna do this and gunna do that'. We should have no more delay. Let's have certainty, let's have economic growth and let's back small business in this country.

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

There are lots of words that are said in this parliament and sometimes those words are recorded for posterity. People must sometimes wonder about the debates that take place in this parliament, but one of the things we should take time to do in this place is to reflect on the small businesses we have in our communities.

We have 15,000 small businesses in the electorate of Mallee. I do not mind taking a little bit of time to talk about some of those small businesses and to celebrate their contribution. Since we have come to government, we have gone on a bit of a journey. We have had to get finances back on track; we have had to set the strategic framework for those small businesses to function. A lot of those businesses in my electorate are exporters. I reflect on the fact that the currency has moved from 105 cents down to 75 cents, and that has helped those exporters, many of whom export to the Asia-Pacific region. I reflect too on the fact that we spent so long fluffing around the edges of free trade agreements, but, since the coalition has come to power, we have locked away a free trade agreement with China, locked away a free trade agreement with South Korea and a free trade agreement with Japan. These have certainly helped the small businesses in my electorate.

There is a great diversity of small businesses in my electorate. There is Oscar Furniture that make aids, appliances and furniture for people with disabilities and for senior Australians—my wife is an occupational therapist who often gets things from that small business. We have Mocha Mecca that makes coffee. Did you know Mildura was the second place in Victoria to have its own barista? We have a very strong Italian community and, if you do not serve good coffee, you do not make a living in Mildura. We also have Phil Hand Electrical—he's a small businessman who employs a couple of people doing electrical work—and we have a guy called Frank Pedulla, who grows wine grapes. We have people in our electorate who do so many exciting things, and it is a good use of the parliament's time to celebrate them and their contributions to the Australian economy.

Having a low currency and free trade agreements creates opportunity, but the changes that we are talking about are about taking that opportunity and turning it into reality. If you look at these small businesses, there is always something they could purchase that could drive their productivity—perhaps help them to market their product better or do their payroll better or get them some infrastructure. This is not a $20,000 grant; this is in fact a tax deduction. There is a difference which needs to be understood. This is something that says, 'We will stand behind your business—now that we have the currency settings right and now that we have the free trade agreements and opportunities in Asia-Pacific region—and we will instil some confidence and strengthen your arm by allowing you to have accelerated depreciation or instant tax write-offs of purchases up to $20,000.'

Over the last few years we went through some very dry times in the Mildura area. The federal Labor government, which left water management to Penny Wong, delivered perhaps one of the most damaging policies to our irrigation community. They purchased the water from a block of land on the conditions that the irrigation infrastructure was pulled out and that that land could not produce anything agricultural for five years. Think about that for a moment: the federal Labor government purchased water on the conditions that not only we do not produce anything but we also pull out that water infrastructure. In my opinion that was one of the worst policies we ever saw from a water minister in the history of the Commonwealth—we used federal funds to take out productivity.

By contrast, our government has committed $103 million to build a modern irrigation system and, now that we have developed free trade agreements and great opportunities, people are asking to get their land back into productivity. They say: 'Can I start producing something back on that land? It is a shame that land had to have that irrigation infrastructure pulled out.' The five years are nearly over, and they are able to bring that land back into productivity. Not only are we batting for them and helping them to bring that land back into productivity, but we are also giving them an instant tax write-off to put that irrigation infrastructure in so that they can go back and actually produce something. The contrast could not be starker. The previous government's view was: 'Shut down, pull up, wind down. There are no jobs, no productivity, no exports, no irrigation infrastructure for your rural community.' That was their way forward. It is our government that has invested in the delivery system, that has developed the markets and the free trade agreements, that has the currency at the right level for them to hit those markets and capitalise on that opportunity and has put the irrigation infrastructure through tax write-offs. All of this says that we stand behind the producers and that we believe in what they can do. This is the real reason the polls are going up. People are realising that one view wanted to shut down regional Australia while the other view wants to grow regional Australia.

Politicians do not create wealth; I said that in my maiden speech. We think we do, and sometimes we get a bit ahead of ourselves and think we are the ones who are creating the wealth. We are only the custodians of the wealth that the Australian people develop and grow. A key factor to growing our wealth is the men and women who get up every day to run a small business, along with the people they employ. Collectively, the hard work of Australians grows our prosperity, and we are entrusted with that prosperity to distribute it equitably to look after senior Australians, to create educational opportunities for our children. We also take care of defence; we build the roads; and we look after health care. It is the small businesses that we should celebrate. I think it is wise that over the coming hours that speaker after speaker in this place present the stories of those they represent and highlight those small businesses, because we value those small businesses. We commend them for their contribution to the country. We stand behind them, and we are demonstrating that through these major changes—changes that are a complete contrast to those of the previous government. People will see them as green shoots. They will literally see these green shoots as vineyards, table grapes, almonds and citrus. They will see them in my electorate, and they will say, 'Aren't we happy that we finally have a government that believes in our future rather than one that thinks the future is only made by shutting us down.'

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

I must say that the member for Mallee, whom I consider a good friend and a great champion of rural Australia, is living in a different world than the one I see. This idea that the measures in the Tax Laws Amendment (Small Business Measures No. 1) Bill 2015 and related bills are somehow in stark contrast to what Labor does in government or, indeed, what Labor did when last in government is just a ridiculous proposition. This is a government without its own economic narrative—we know that. That is an incontestable proposition. While Labor welcome all the measures taken in these bills—and we made it very clear from budget night that we would be supporting the bills—many of the measures, if not most of the measures, are a reinstatement of the tax breaks that Labor put in place when in government, which this government repealed as one of its first acts as a new government. So for the member for Mallee to suggest that this bill highlights the contrast between the two major political parties is just simply a ridiculous proposition.

As I said, this is a government without an economic narrative. It has no economic reform program of any merit or of any substantial weight. That this government is cutting funding to those least able to afford to have their income cut or to have the government support of their community organisations cut does not fall under the definition of 'economic reform'. It certainly does not fall under the definition of 'structural reform'. This government has no idea about fiscal policy or social policy, and it certainly does not have any idea about agriculture policy—and how fortuitous it is to have the Minister for Agriculture at the table, as I speak.

But it gets worse than that, because this government talks about small business as if it is homogenous, as if each and every one of our small businesspeople, organisations or entities is the same. We all know that that could not be further from the truth. Our small business sector is very, very diverse. It comprises larger and smaller businesses; those motivated to grow, those not motivated to grow; those motivated to increase revenues, those who are not; those motivated to employ more, those not so motivated to employ more. They are in retail, wholesale, manufacturing, IT, the services sector, entertainment, farming and trades—the list goes on and on and on. The motivations vary considerably. As I said, some want to grow, some do not. Some want to employ more staff, many do not because of all the complexity, responsibility, regulation and red tape burden that comes with such a proposition. Some want to innovate, some do not. Some are effectively just buying themselves a job. That is the truth of it. Many tradies are perfect examples of that. Many truck drivers provide another example. They are buying themselves a job by necessity, or they are motivated to do so. They are happy with a reasonable income stream and to maybe work five days a week rather than seven—many, of course, do work seven, but many do not.

So we are dealing with a very diverse range of people and business entities, and this is well acknowledged and understood by those in academia who follow small business policy and, indeed, promote small business policy. I am very grateful to know one of them, a very good friend of mine, Professor Scott Holmes, who is the Deputy Vice-Chancellor at the University of Western Sydney. He has relied on very extensive survey data in breaking down small businesses into five groups. This is interesting, because the groups not only are very different in their make-up, motivation, profit and ambition et cetera but also see themselves as affected or challenged by different areas of government policy.

The first segment is a group he calls 'financially constrained growth aspirers'. He said these are younger businesses mostly seeking growth but struggling to achieve it. Two-thirds of them feel they are not performing to their expectations. He describes the second group as 'externally impacted growth seekers'. He says they are mature businesses mostly seeking growth and, like segment 1, struggle to achieve it, with something like 65 per cent of them performing worse than they had hoped over the past 12 months. He describes the third group as 'broadly impacted stability seekers'. These are businesses with lesser growth aspirations, yet they are only moderately satisfied with their performance, with almost half reporting their business performed under their expectations. The fourth is the 'stress free stability seekers'. He says they are a well-established group and there seems to be no area that really impacts upon them in terms of their business ambitions. They are, of course, the group we like most. They do not have any trouble with government, apparently; but there is good reason for this, and I will return to it. The fifth group is the 'technology oriented growth achievers'. These businesses tend to be relatively large and involved in the production of technology-related products and services. Most of these growth-oriented businesses are successful in achieving their goals, with a higher proportion performing better than expected, in their minds and in their assessments of their own businesses.

One of the key points about all this is, as I said, that they see government putting up different sorts of challenges for them. The same survey work demonstrates that the key issues across all groups are as follows: first of all, economic uncertainty—and I think I could spend some time talking about the economic uncertainty this government has created over the last 20 months by constantly talking down the economy and by its fearmongering campaign on debt and deficit et cetera—followed by, second, the maintenance of and growing revenues; third, managing cash flows, costs and overheads; fourth is competition; and the fifth is red tape, taxation and compliance. This goes to the point about the mantra surrounding this bill. Despite the diversity of the small business sector, the Prime Minister would have you believe that what is contained within these bills is the panacea for all ills—that for small business, the world is now its oyster because of these tax measures—when the reality is, I remind the House, that many of these measures are a reintroduction of what Labor had done in government. While they are still welcome—it is a welcome thing that the government has had a rethink—the mantra from the government strongly implies that they see this as the end of the road for government: that government has now done its work, and small business can sail on happily now because of all these wonderful the things the government has done within these bills.

The thing about Scott Holmes's work is that of those five segments I spoke about, various government roles and responsibilities are given different weights by their businesses, depending on which segment they fall into. For example, segment one, the financially constrained growth aspirers, is mainly concerned about maintaining and growing revenues, managing cash flows, costs and overheads, and access to finance. But when you get to segment two, for them it is all about economic uncertainty and competition—I suspect that is competition amongst businesses, and perceptions about market power amongst some of their competitors. In segment three, it is all about red tape, taxation, and managing cash flows—you would expect that these bills would be most welcomed by the 17 per cent of small entities that fall into segment three. In segment four, more than 70 per cent are satisfied with their business's ability to meet their goals, and they are not really concerned at all about government intervention or the way in which government policy impacts upon them. Segment five, the technology oriented growth achievers, are concerned most about technology changes and competition. So you can see the diversity, both in the make-up of the entities—the nature of the entities—and in the areas of government policy which concern them most.

The point I am making here is that small business policy cannot end at some taxation changes, as welcome as they might be. This government—just like with its broader economic narrative—has no story to tell about where it aspires to take our country's small entrepreneurs into the future. There are also some agriculture initiatives in this bill, and I welcome them—and tax breaks generally of varying kinds, particularly in the area of depreciation. The big criticism I had on budget night, which of course has now been repaired by a very significant backdown by the minister at the table, was this idea that farmers who had been in drought for three years were not worthy of a new depreciation schedule—a tax break—until sometime after 1 July 2017. Well, that would have been a great load of help to farmers in drought! In fact, it would have been no help at all. So I welcome the backdown, and the fact that that tax break will come earlier. But it is a good initiative to give accelerated depreciation schedules to farmers facing drought, who have some need for investment in things like feed storage, water initiatives, or fencing—one of the biggest challenges facing many of our people on the land is wild dogs; fencing, for many reasons, is of course a good thing—and we welcome this initiative.

Of course, this has to be seen in the context of some of the lesser achievements in agriculture. The cuts to FAGs grants will not help people in rural communities very much: that is a billion dollars out of councils; money that could have been spent on local initiatives to stimulate drought-affected economies. The drought policy has been an absolute failure: the minister is borrowing at just over two per cent and lending at between three and four per cent—and he still cannot spend the money. That is why he keeps re-announcing his drought money, because either farmers are just not taking up the measure or the support because they do not see that it will help in their circumstances, or they are not eligible for the assistance. I urge the minister again to take another look at the failings of that policy. The opposition stands ready to support any change in direction that would help. I thought the minister's rebate on water initiatives was a worthy initiative, and I would welcome the transfer of some of that loans money that he cannot spend into that initiative to provide more support.

The other big thing—I would describe it as a clanger—is the minister's decision to force the APVMA out of Canberra. This is an organisation that is not funded by government. It is an organisation which works on a fee-for-service basis. Its money comes from the companies it serves—that is, companies that are not based in Armidale, in the minister's electorate; they are companies that are typically based in our capital cities including Canberra. This is going to be a catastrophe for the APVMA and for the agriculture sector. I call upon the minister to have a rethink. He is doing the same thing with our research and development corporations. He promised to spend more money on R? he has done nothing but cut it—sorry; not 'nothing but cut it': he has put some extra money in, but he has taken more out than he has put in. So that is a clear breach of his election promise. And now he is forcing them to move—the GRDC to Wagga Wagga, the Fisheries RDC to Hobart, the Rural Industries RDC to Albury-Wodonga and of course the APVMA to Armidale. He had already cut the RDC funding, by the way, which is worth noting.

Minister, I appeal to you. You know that all of these organisations are distraught over this measure. They believe it is going to have a significant adverse impact on the commodity sectors they serve. You know, Minister, they are going to lose a lot of good people. You are forcing them to pay for this move! This is more than $40 million out of research going not to research but to an office move and redundancies. Please, tell me how is this a good idea? Decentralisation, in principle, is a good thing. It can work. It rarely does but it can. But it only works when there is a strategic plan which is well thought out and when we have consultation with those who are going to be affected. You have done none of that, Minister. This is no more than a thought bubble on your part. I would like to think it is not pork-barrelling in your electorate. That is for you to explain. But it is a bad idea, Minister. You should rethink it and listen to what the APVMA people and those who run our world's best RDCs are saying to you.

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

It is a pleasure to rise on something—the Tax Laws Amendment (Small Business Measures No. 1) Bill 2015 and cognate bill—that shows the dedication by the coalition to small business and to agriculture. I might take the shadow minister up on some of his issues. I think a department—possibly the mines department—has been moved, by the state Labor government, to his electorate. So the whole idea that he does not believe in moving departments so quickly falls over when there is one in his own backyard. And, of course, we also had the Department of Agriculture that has been moved to Orange. It has not fallen over. It is working quite well at a state level. Another department was moved by the Labor Party down to Nowra. So the rhetoric changes depending on the day. We have policy of the Labor Party right now in Western Australia wanting to move departments to Albany and to Bunbury. So this is quite evident.

Just to take the member for Hunter up on this issue, where we have co-located departments, RDCs, such as in Narrabri, we now have the highest yielding cotton in the world. It has been a success. It has created a centre of excellence. It would have to be called that because if you are the best in the world then what you do speaks for itself. The member for Wakefield talked about how we had to truncate this debate so we did not have to suffer the sins of people droning on. He then proceeded to speak for 15 minutes and was followed up by every other Labor Party member speaking for 15 minutes.

I have been an accountant much longer than I have ever been a parliamentarian. My life in small business was how I got ahead. I still have a small business. My wife and I are cattle and sheep producers now. What we do has been built on a foundation of lived experience. On our side of the chamber, I am proud of the fact that we have people who have actually been in business, who have actually had that fear that comes on a Friday evening—and, no doubt, Deputy Speaker Kelly, you have done this yourself—of working out where the wages are going to come from. That is a sense of realism—understanding your responsibility to your staff, because the staff are what make a business work. It is from that basis, from that vessel of experience, that the coalition is moving forward with a plan to reinvigorate the business community. And it is working.

If we look at some of these measures, how they work in small business generally and in agriculture in particular, you can see the difference they make. The immediate write-off for plant, for businesses with turnovers of less than $2 million, for as many items of plant as you wish as long as that item of plant does not exceed $20,000, has had an immediate effect. We have now seen specials on second-hand utes for $19,999. So we know that this is actually landing as we speak.

If you look at the plant around a farm that is turning over $2 million—if you are selling $1.9 million worth of cattle, you are doing quite well for a family—it would mean that, immediately, as of budget night, for the post-hole digger you would get 100 per cent write-off; the compressor, a 100 per cent write-off; and the welder, 100 per cent write-off. These are things that are actually manufactured in our nation and we must make sure that we stimulate the manufacturing industry. Cattle crushes are made in Australia —a 100 per cent write-off immediately that night, as well as for stockyard panels. A lot of the attachments and farm implements are made in Australia. This is stimulating growth, as well as making sure that properties are refurbished.

As part of this process we are also reaching out to these small businesses. If they are a corporate entity, they get 1½ per cent tax deduction. That is certainly of assistance. If they are not corporatised—and, to be honest, a lot of farming entities are partnership sole traders—they get the advantage of a five per cent reduction in the tax, to the value of $1,000—a rebateable item. These are all statements that say we understand your life; we have people in the coalition who have lived that experience. We understand the whole philosophy of small business.

The thing that is beautiful about small business is this: it gives you the opportunity to find your highest level of freedom because you become master of your own ship. You live by your own corporate manual. The results of your endeavours are directly attributable to the money that you actually get and can actually bank. In essence, you aspire to try and find the highest level of freedom by the sweat of your own brow. Sometimes it is successful; sometimes it is a tough game. Sometimes it comes unstuck and that has been the way of business for eternity. But we know that it stands behind the capacity for people. If they are in their own business they can say what they like; they do not have to abide by the corporate culture. They can actually go forward and present their own views clearly and unambiguously because there is that greater freedom.

When I was thinking about a political career I knew that it would be unfair to try to do it in a corporate setting. You had to basically be in your own business, because you cannot have other people in the workplace basically being encumbered by your views and whether they agree with them or not. So this is another great thing that stands behind the liberty of the individual as expressed in its most pronounced form through small business.

I also want to note three issues that were part of the white paper that have been announced in the budget—the 100 per cent write-off for water reticulation as an assistance to security, especially security against drought; the 100 per cent write-off for fencing; and the write-off over three years for fodder storage, including grain, which is pertinent to dealing with drought. These are incredibly important. In so many areas, if you can get some silage in and get some country laser levelled and put a lateral in, you have a capacity to better prepare yourself for droughts. Refurbishing what is on the place will go hand in glove with the dams policy, which we will be announcing imminently. These things work together. It is part of a plan. We are inspiring people to develop their places, and the government will be part and parcel of the construction of dams.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

When will see the white paper? Give us a hint, just a tease. Next week? The week after?

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

I will take the interjection from the member for Hunter. The grand plan for the Labor Party was the food plan—$30 million. That was it! That was as much as we could get from the shadow minister. Our beef road announcement alone is worth $100 million, which is three times bigger than their total food plan. What have we done so far in drought? $400 million. That is more than 10 times his food plan. The Labor Party does not even have a farmer—the once great party of Mick Young! There is no-one there.

Mr Fitzgibbon interjecting—

Joe Hockey (North Sydney, Liberal Party, Treasurer) Share this | Link to this | Hansard source

Member for Hunter, I will credit you with one thing: I think you might be one of the only small business people who has ever been in business in the Labor Party.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

I certainly am a small business person, but I don't know about 'the only one'.

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

Who are the other ones? You must be able to answer that. Is there another one in the whole of the Australian Labor Party at a federal level?

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

Shane Neumann.

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

Shane Neumann—a solicitor. Fair enough. They have got two small business people in the Labor Party. That is why it they do not have the lived experience of being in business. They do not know what it is like. That is why there is no formation around their policy. But let's go back to those measures I was talking about. If we have a three-year write-off of silos and sheds, that also stimulates the contractors who build the silos. And guess where they build silos? In Australia, in our nation. So this actually stands behind the manufacturing sector of our nation. So we are getting the people who are build the crushes; we are stimulating the growth of the people who build the silos. We are actually delivering the outcomes that not only—

Mr Fitzgibbon interjecting—

He is back to tell us about the white paper which will be released imminently. He has gone to the telephone, he has rung up to see how many small business people there are in the Labor Party. And do you know what they have said? 'You're correct, there are only two of you'! There are only two of them—that is it. An alternative government—as they see themselves—that does not even have people who have the capacity to run their own business has no hope of running the nation. And you can see that in the how they worked. Their operation of the nation was a debacle, a soap. And the soap is on at night now—we watched it last night! And guess who was part of that soap? The member for Hunter was. The soap of Gillard, the soap of Swan, the soap of Kevin Rudd—and that is the soap of Labor Party economic policy.

It is great to come to the dispatch box to talk about the complete vacuum from this babbling brook, this wandering drone, on the other side. There is no depth. But we have put forward a plan. You get a 100 per cent write-off for refurbishment of your irrigation infrastructure to assist with drought. This is incredibly important. You get a 100 per cent write-off for fencing. So that is all the farm produce suppliers and hardware suppliers—they are also in place.

Mr Fitzgibbon interjecting—

I will take the interjection again. He said: 'If you are not making a profit.' It is under our government that we have had record prices in cattle and record prices in sheep. We now have wool at over 1,300 cents a kilogram—the price is up again today. We have record low interest rates. We have the lowest interest rate—and we are providing them.

Mr Fitzgibbon interjecting—

The member for Hunter talks about what we have done. We now have now lent out over $280 million at concessional rates. We have over 550 people taking those applications. More than 5,000 people have had access to Farm Household Allowance. Under the shadow minister, 367 people accessed it. But we have had more than 5,000 people access it. This is the difference. Do you know how many people they put out concessional loans to? Eight! We have got over 550. The difference is profound. But this is all part and parcel of the plan.

Mr Fitzgibbon interjecting—

We will imminently see the white paper. You keep talking about it. You are giving me oxygen. You are a great advertisement for what we are doing. You are a great advertisement for the fact that we have put $100 million on the table for beef roads. You are a great advertisement for the fact that we have put $400 million on the table for drought thus far. You are a great advertisement for the fact that there are only two people in the Labor Party—and you have gone up to the phone and checked—that have ever been in business. You are a great advertisement in general for the Australian Labor Party and I credit you for the work you have done.

When he looks to the plan he says, 'Oh, you can't dare start centres of excellence to try to bring about a form of decentralisation to inspire centres in Australia to be expert at what they do.' No, he does not want that. He wants everything in Canberra, because that is where they live. That is the only place they exist.

It is great to be a former accountant and to come in here and be part of a government that understands business, to come into a place where we have colleagues who have actually been in business, to be part of a government that has been part and parcel but that now sees record prices in cattle, record prices in sheep, a huge turnaround in wool. And there is the work we have done on such things as three new free trade agreements, six new live animal destinations and the lowest interest rates on record. We are part of a government that actually talks about agriculture. Mr Swan—what was he, the Treasurer of the millennia?—the member for Lilley: how many times in his budget speeches did the Treasurer of the millennia mention the word 'agriculture'? The answer is quite simple: he never did.

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak on the Tax Laws Amendment (Small Business Measures No. 1) Bill 2015 and related legislation, which flows from the introduction of this year's budget. The first bill amends the Tax Rates Act 1986, reduces the company income tax rate by 1.5 per cent, lowering it from 30 per cent to 28.5 per cent. This will apply for small businesses with an annual turnover of under $2 million. The second bill before us temporarily increases the $1,000 threshold for the costs of depreciating assets under the small business equity capital allowance provisions to $20,000. This will apply to small businesses with a turnover of less than $2 million, and there is no plan to extend this beyond July 2017.

There are some very rare and isolated positive measures to be found in the Abbott government's 2015-16 budget. The provisions in respect of small business, I must say, is one of them. They are certainly much-needed measures to assist small business, and it is essential that these matters be dealt with without delay. We saw today in the House something quite extraordinary. After weeks of urging the immediate passage of these bills, those opposite voted to delay the legislation being passed. It was quite extraordinary. After all, come the last budget, it was made very clear by both sides, who supported this, that it should be dealt with expeditiously. It is a matter of record now that Labor was prepared to immediately pass the small business measures in the House, whilst those opposite voted to have more talks before passing this legislation. I suppose I am grateful that they did, because it gives me the opportunity to talk about small business, and small business in my area. But I would have thought that the overriding imperative would be to actually pass the small business legislation by agreement.

Let it be clear: we were all for speeding up the process. We were all for seeing passage through this place as quickly as possible. I am not sure what went through the head of the minister sitting at the table at that stage who decided to vote against it.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

Not much!

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

As my colleague says, not much. Not much thought went into it. And not much thought went into how this will be perceived by the hundreds of thousands of small businesses out there who maybe do not tune in to parliament as regularly as some. But certainly they will get the message that this was not high on the list of priorities of those opposite, who just wanted the opportunity to have a bit of a talkfest, play around with this, and get to it when they felt like it.

That is basically the difference here. We came to the table with a very clear view that we wanted to hasten the passage of this legislation through the parliament. We had the position very clearly laid out, and they trundled in here and walked to the other side simply so other colleagues could spend their time waxing lyrically about small business. And they say they are the friends of small business! I have to say, with friends like that you do not need enemies. And do not forget: last year's budget, which I think would go down candidly as a ruthless budget, saw some $5 billion cut away from tax assistance from micro and small businesses. That included the abolition of the instant asset write-off, which this government is now bringing back, and we actually welcome that. But they abolished that last year. Labor increased the instant asset write-off threshold for small business to $6,500, with an unlimited number of eligible assets. Together with the changes of accelerated deductions for motor vehicles and the introduction of the loss carry-back for companies, small business saw a boost of more than $5 billion while Labor was in power.

These measures were put in place to help small business improve its cash flow and to make it easier to invest in the business. The big question here is why those measures were abolished in the first place. They cannot quite bring themselves to say that Labor was right that we should support small business. They have been taken to this position screaming and kicking, faced with reality, and that is why they have had to reintroduce those measures that Labor had already introduced.

The Abbott government is already on record. It does not have a very good record when it comes to small business. Their first action in coming to power was to cut the instant asset write-off. They knocked out that tax loss carry-back as well as the accelerated depreciation on motor vehicles. They stripped that. That was their first action in coming to power. It is not difficult to see that the turnaround in the government's attitude is about jobs. But it is not about the jobs of people in small business or their employees, it is about the jobs of those opposite—in particular, the Prime Minister's job.

The justification for these cuts was supposedly the dire economic situation—a budget emergency, as they put it. Twelve months down the track, what happened to that? In terms of all the negative speeches they made for 12 months following that budget they managed to drive down business and consumer confidence. If you tick that up on their track record, I think they get to own that. The deficit has gone up. Net debt is just a tad over 17 per cent of GDP, for 2015 2016, and both look like they are continuing to climb.

So what happened to that budget emergency they used to justify stripping all those benefits that Labor brought in for small business? Clearly, creating an atmosphere of fear and uncertainty about the future did not instil confidence in people, certainly not confidence in business to help drive and fuel our economic performance. The truth is, small business contributes about $330 billion to Australia's GDP and employs more than half of all private-sector employees.

There is no doubt, Mr Deputy Speaker Kelly, in your electorate—like mine—small business is at the front of our local economies, any research will show that small business sits front and centre of our country's economic activity as well. It deserves not only to have a plan laid out for the next two years but also to have a long-term plan for assistance and growth. We need to assist with the driving of small business. We need to help people make it easier to reinvest in their businesses, not simply lay a plan out for two years. This government has only put forward measures to assist small business over that two-year period. There is no plan to go beyond the 1½ per cent tax cut for small business.

It has been said on numerous occasions, and this morning the Leader of the Opposition outlined it, that we on this side of the House are quite prepared to work at ways of even further lowering tax on small business. As the Leader of the Opposition said, he would like to see it get down to 25 per cent. So there is a real opportunity in this place to work on a fair and reasonable plan to reduce the taxes of small businesses down from 30 per cent—sure, but it should not stop at 28.5 per cent. Let us see what we can do together if we are serious about doing something for small businesses, in helping them drive the economy and bringing that figure down as far as possible—hopefully, eventually landing at 25 per cent.

The sentiments on the approach of this government have been echoed from some very prominent business leaders. I will reflect on a couple of them. The CEO of Chartered Accountants Australia and New Zealand, Lee White, described the government's 'fair go' budget as 'healthy housekeeping but isolated from the long-term plan needed for Australia's future success'. He went on to say, 'Tonight's budget provides welcome relief for small businesses, but it fails to provide an adequate road map for the years ahead.'

The chief executive of CPA Australia, Alex Malley, said 'The small-business package was one of the only high points in the budget, where it was evident the government had been spooked by the negative reception it got for its 2014 budget.' That is probably a fair comment. Despite the lack of long-term vision, the measures before us do represent a positive step. There are approximately 7,600 small businesses in my electorate of Fowler, and I would expect that the vast majority of them would benefit from these measures.

The proposed measures have the support of various leading bodies in our electorates that look after or support small businesses. For instance, I recently attended a meeting of the Cabramatta Chamber of Commerce. The meeting was chaired by the secretary, Ken Chapman, a very good friend of mine. The president, John Medich, is still recovering from surgery. This is a chamber that works very hard in our community to assist and support the high number of small businesses in the Cabramatta region. They welcomed the small-business measures that flowed from the budget, as did the Liverpool Chamber of Commerce, through its president, Harry Hunt OAM. He does a very good job in reflecting and advocating for businesses of Liverpool.

Another group looking after the interests of small business—not simply advocating for them but helping establish the mechanisms supporting small businesses—is the South West Sydney Business Enterprise Centre, formerly known as the Macarthur BEC. I know very well the group's chairman, Bruce Hanrahan AM, a local solicitor in Campbelltown, and David Waudby, the CEO. I know they have both worked very hard not only in advocating for businesses in their area but also in laying down the foundation and advice for people wanting to start and grow a business. I commend them for the work they do on behalf of our community.

In the few moments I have left I will reflect on a couple of the 7½ thousand local small businesses I have operating in my area. These are people who have started business ventures from nothing and who now employ a great number of people, contributing to our local economy. For instance, there is a business run by a friend of mine, Jensen Tran. He established and manages the Roseland Import and Export company. He does a tremendous job in our local community. Hung Ly established and now manages Dragon Home Loans. He is certainly very significant in the financial areas of Cabramatta and Canley Vale

Thay Lim OAM, a refugee who came to this country some years back, established and now manages the Janbay Home Timber and Hardware business in Canley Heights. Simon Grima established and manages the Bonnyrigg Tyres & Mechanical business and Sam Rigoli owns and manages the franchise of Crust Gourmet Pizza at Bonnyrigg. These people have all taken on a certain amount of commercial risk in establishing their businesses and have worked very, very hard, together with their families. We should be proud of what they have been able to achieve within our local community not only through creating jobs but adding to our local economy.

In concluding, Labor supports all the small business measures before us, particularly the accelerated depreciation measure—and I might reiterate that it was Labor who originally introduced it. Small business across Australia deserves our support. They deserve every piece of assistance that we can offer, because we look to them to help grow our economy and to generate employment. Labor clearly is not on the side of standing in the way of these matters being delivered.

Eric Hutchinson (Lyons, Liberal Party) Share this | Link to this | Hansard source

One might have been forgiven for thinking in the first 14 minutes of the member for Fowler's contribution on the Tax Laws Amendment (Small Business Measures No. 1) Bill 2015 and cognate bill that there were no small businesses in his electorate, because he spent a lot of time there talking about the 2014 budget, which was the year before this budget which has these very, very welcome measures. He did reflect for a short time on the Leader of the Opposition's budget-in-reply speech. This was the contribution by the Leader of the Opposition where there was $220 million spent, unfunded, for the 29 minutes. Thank goodness he did not go for the full 30 minutes!

I have just been upstairs, as part of my role with the House of Representatives Standing Committee on Education and Employment. One submission that was made to the national inquiry we are holding at the moment was from Mark Brennan, the Australian Small Business Commissioner. Indeed, the member for Gorton and also the member for Perth were there, and I thank them for their constructive questions and contributions in that really important forum. This debate is about looking at the impediments for small businesses to employing more people. I suspect that they, if they had had a choice, would have certainly not wanted to try and gag the opportunity that all members in this place have—those on the other side and in the government—to talk about the value that small business creates in this country. Indeed, we want to ensure that Australia is the best place to start and grow a business. That is what I want to do in my electorate. I think we all came into this place to do good, to give something back and to let the innovative Australians that we know do what they do best. At the end of it all, it is about people. And we believe that the people in charge of small businesses in our communities—in regional Australia, in the cities—are the ones who know best. They are the ones who know best what to do with their own money and that is why we are giving them back money. We are giving them back their own money. It is not our money, it is their money, and that is why we are giving it back to them as part of the measures in this year's budget.

I want to ensure that my electorate of Lyons in Tasmania is a place where small business gets all the support it needs to thrive and to flourish. More than 95 per cent of all of Australian businesses are small businesses, employing more than 4½ million people, producing more than $330 billion of our nation's economic output every year. We know that it is the right time to invest in business as a driver in our country's positive economic future. This is what we as a nation must now be doing and we are giving the tools and the opportunity to those people who know best how to do that.

That is why it is the right time to introduce the first of the proposed legislation to guarantee a solid footing for these businesses. These tax law amendments have already been welcomed with open arms, particularly by small businesses, in the country areas of my electorate. Schedule 1 of the bill proposes amending the Income Tax Rates Act 1986 to reduce the company tax rate, from 30 per cent to 28½ per cent, for companies that are small business entities with a turnover of less than $2 million annually. We do know though, of course, that a relatively small proportion of small businesses in Australia are incorporated entities, so those that make up the majority will be given a five per cent discount on their taxation, up to a value of $1,000, which is commensurate with the measure in terms of taxation reduction. The amendments will apply for the first income year from 1 July this year and the measure was announced as part of the Jobs and Small Business package in the budget last month.

The reaction to this move has been overwhelmingly positive. I travelled around my electorate of Lyons talking to the many, many people that it will benefit. I spent the Saturday morning in New Norfolk, one of the larger population centres in my patch. It was extraordinary to see. We copped a bit of flak last year in our efforts to reset the finances of our nation, so I was not feeling too sure. I had my brochure but, when I walked into the hairdressers, they already knew—it was amazing how quickly good news had travelled! They all knew that there was an opportunity here for them and that there was something in the budget. They all knew that this was a government that was focused on them and their small businesses—whether they are cafes or hairdressers. I was quite taken aback. I could go on—I could list so many small businesses that will benefit from this in my patch. Indeed, as I say, it has been welcomed.

I have mentioned before Jane Shaw at the Ingleside Bakery at Evandale; Jane and her husband have a staff of 15 people. Most of them are casuals, two are full time, and she said that the size of these proposed tax measures would make a significant difference to their business. Keith Rice operates Primary Employers Tasmania, which is contracted to, for example, the poppy growers association. When I rang Keith about another matter he said, 'My wife has gone out and bought a new computer already.' These are the sorts of things that are happening on the ground.

While the Tax Laws Amendment (Small Business Measures No 1) Bill will reduce corporate tax rates by 1.5 per cent, the Tax Laws Amendment (Small Business Measures No 2) Bill will provide accelerated depreciation arrangements to small businesses and primary producers. Can I say—as I know I go on about it a fair bit in this place—that this is perfect timing for the irrigation development going on within the state of Tasmania. I do not want to sound like a broken record, and I apologise for that. It has bipartisan support, and I acknowledge the contribution, particularly, of David Llewellyn, the former minister in Tasmania. It was good public policy, it had bipartisan support, and I acknowledge the contribution of former Minister Llewellyn in the former Tasmanian Labor government.

It is just beautiful timing for so many farmers. I was talking to Richard Hallett, who is in the Southern Highlands Irrigation Scheme, a couple of days ago about this. They have already developed parts of their property and they have infrastructure in place. With the Southern Highlands Irrigation Scheme now confirmed, thanks to $60 million from the Commonwealth government, and the tax offsets, these immediate asset write-offs, the capacity for them to take advantage of the increased cashflow, which they will be able to generate from that opportunity, is truly significant. This will have enormous benefits for their local economy, as it will on the East Coast. Brown Brothers on the East Coast and Spring Vale Vineyard on the East Coast are all planning expansions on the back of the irrigation scheme, and this gives them a simple tool to be able to do that.

I think of Tim Schmidt from Deloraine. Indeed, for those that are paying tax it is toss-up whether or not to buy an $18,000 second-hand irrigator to smaller business. He will be able to write off that under the $20,000 instant asset write-off. Or, maybe, he buys a new irrigator, because as a primary producer he would be able to write off that $34,000 for the equivalent new version of the same irrigator. I also think of Howard Hansen. Howard is an interesting case study. Howard has significant orchards in the member for Franklin's electorate, and he also grows cherries in the Derwent Valley which is in the electorate of Lyons. He is planning on planting an additional 10 hectares of apples in the Derwent Valley, putting in a dam and putting in an additional 10 hectares of cherries in the Derwent Valley this winter. He is about to order between $150,000 and $200,000 worth of irrigation pumps, mains, filters and drip tubes. The additional investment of this money was not going to occur this year, but now Howard is seriously considering bringing it forward into this year. What it means is jobs. It means expansion of his business and it means more jobs for people in the Huon Valley in the member for Franklin's electorate, and it means more jobs for the people in the Derwent Valley in my electorate. This is all good news.

The bill will amend the small business simplified depreciation rules in the tax laws to increase the threshold for immediate deductibility from $1,000 to $20,000. As I have mentioned, this is a significant increase in the threshold, as the business owners in my electorate have been telling me. It will provide a major improvement in cashflow for many, many small businesses. While it is businesses that create jobs, there is a clear role for the government to address impediments and create the right conditions for small businesses to grow and become more productive so that more jobs will flow. That is our fundamental responsibility.

The Australian economy is in a transition. The declining terms of trade and the ageing of the population, which is something we should celebrate of course, are placing downward pressures on income growth. Obviously going into the production phase of the mining industry, there is a real need to see small business rise to the top. Small businesses are a key driver of Australia's economy underpinning growth and innovation and providing jobs, as I have said, for millions of Australians including thousands of Tasmanians.

These tax proposals have been carefully thought through after specific consultation with businesses, tax specialists outside of government and the ATO. As Minister for Small Business Billson says, 'We know from the Intergenerational report that there will be a significant challenge to maintain our country's current rate of income growth.' Future growth in living standards must be driven by higher levels of Australian productivity. It will need productivity growth to increase to about three per cent, which is well in excess of what Australia has achieved in the past 50 years, and more than doubles what has occurred in the past decade. Growth will need more and better quality goods and services to be generated from the resources we already have. Again, that is why this government has made small business the absolute cornerstone of the budget this year. It is the biggest small-business package in Australia's history, and at the heart of the package are the tax cuts and the instant asset write-offs for all small businesses, as we have mentioned.

The government are working to support jobs and small business. If you look at our record over the last 18 months, it really is a record of success and achievement, and we are a government that are delivering for the engine room that is small business in our economy. We have repealed the carbon tax, and we have repealed the mining tax. We have finalised three free trade agreements with South Korea, Japan and, most recently, China. There is more to come. We have announced $2.45 billion in annual red-tape savings, which does not sound very sexy, but let me assure you that this is the thing that stops people investing. We have established the $484.2 million Entrepreneurs' Infrastructure Program. We have created new employment opportunities through a significant $50 billion investment in transport infrastructure. That manifests itself in my electorate into things like new bridges and better roads and being able to get the products that are produced by the small businesses in my electorate to the markets, which we are opening up in Asia through the free trade agreements, more easily.

We have established a $6.8 billion job-active employment service. If you want to have a go, if you are a job seeker, if you are an employer, we want to support you. If you are a family with somebody looking to go back to work, we want to support you. We are supporting the VET sector. We have introduced Restart for those over 50s that have the experience and want to get back into the workforce, because we are going to need you. We are going to need you in the small businesses. They start to work on their businesses rather than in their businesses. This is something that we want to increasingly see. We have expanded tax concessions for employee share schemes and for unfair contract protections to small businesses. We know that many small businesses are doing it tough. The government know, and they believe in you and will support you. We need you to be working increasingly, as I said, on your business, not in it. Get advice. We will support you. We want your small business to become a big business.

Bruce Scott (Maranoa, Deputy-Speaker) Share this | Link to this | Hansard source

The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour and the member will have leave to continue his remarks should he so wish.