Nick Xenophon (SA, Independent) Share this | Hansard source

It is problematic. Thank you very much, Senator Whish-Wilson. I think that the current thresholds that have been proposed are too low. If you have a truck-driving contract—and I know Senator Sterle, who is in the chamber, could relate to this—with a business and it is over $100,000 a year, then you will not be covered. The Australian Greens have put up some amendments to increase those thresholds significantly, but not in a way that goes against the spirit of it applying to small businesses, so I think those amendments deserve support and need to be looked at. The onus is on the government to indicate what they will do about that, because I think we will emasculate this piece of legislation unless there are higher thresholds.

The second issue, and Senator Edwards referred to it, quite fairly, is the concerns of the Australian Bankers Association in terms of a business which has 20 employees or fewer, where that business might be involved in merchant banking, it might be involved in derivatives, it might have a multibillion dollar a year turnover and it might be a subsidiary of a parent company such as a major bank. I would have thought that a business like that was big enough, given its financial transactions, to look after itself. The Australian Bankers Association has made some reasonable points about the bill applying in these circumstances, but I would like to hear from the government in the committee stage of the bill about those concerns, because I think it could be anomalous if we put our energies into covering businesses such as those, which might have a multibillion dollar a year turnover, and not those genuine small businesses that need the support and the framework of protection in this bill.

The Council of Small Business of Australia in its submission of 27 August 2015 to the Senate Economics Legislation Committee made a very reasonable point, saying:

We agree with the approach of the legislation and understand the need for this ground breaking legislation to perhaps tread carefully in its first flush.

Our area of greatest concern is around the threshold for the initiatives of the legislation to take effect. We consider these thresholds to be too low as it will not pick up some of the worst contracts imposed upon small business from big businesses including leases, newsagent contracts and franchises.

That is picked up in the Greens amendments. If we are going to do this, let us do it properly. Let us deal with all contracts with small businesses, such as for newsagents and in leasing arrangements, where clearly there can be unfair contract terms. I think that is something that needs to be done. I know, Mr Acting Deputy President Bernardi, what a great supporter you are of small business. If you enter into a lease in a Westfield supermarket, it is well over the threshold that this bill is proposing. These are matters that the government needs to address.

The government also needs to address another broader issue, and that is access to justice. If you are involved in a commercial dispute before the courts in this country, even if it is in a lower court—not in the Federal Court or a supreme court of a state, or even if it is in a district court or the magistrate's court—you could be risking many tens of thousands, indeed hundreds of thousands, of dollars in order to try and enforce your rights. There is something fundamentally wrong with our system of access to justice in this country, because there are so many small businesses in particular, with respect to commercial disputes, that are terrified of exercising their rights. Even if they are told by their lawyers that they have a pretty strong case, but it is not 100 per cent, they are scared of running that case because of that 10 per cent risk factor where they could lose the case and lose everything—lose their business, lose their home. We have a legal system in this country; we do not have a justice system.

I would like to ask the government whether it considers that these changes will make it easier and more cost-effective for Australians to access justice in circumstances where they are involved in a commercial dispute, because, clearly, removing unfair contract terms will tip the balance and level the playing field in favour of small businesses, which are a significant driver of jobs growth in the economy. That is why I think we need to look at incentives for small businesses, as well as to ensure that they can compete fairly with big businesses in this country.

The final comment I want to make goes to the issue of a very big business, and that is defence procurement—making submarines and naval ships in this country. The significance of ensuring that we maximise procurement in this country for Australian content cannot be understated in terms of its impact on small businesses.

In South Australia, we have the worst unemployment rates in the nation. We are looking, I am afraid, at double-digit unemployment figures unless there is urgent action in terms of the transformation of our automotive sector, from which we will see the departure of General Motors Holden, Ford and Toyota as car makers in this country by the end of 2017.

I know that Senator Kim Carr, who is in the chamber, has been a passionate supporter of this industry, but we also need to be passionate supporters of having the best transition plan to grow jobs in other sectors of the automotive components sector—the small businesses in the automotive aftermarket industry which Senator Ricky Muir has been a great advocate for, or the motor trades associations around the country, where there are many tens of thousands of jobs in retraining and skills to grow that sector. Cars need to be serviced, preferably by locally trained workers. The Federation of Automotive Products Manufacturers has now merged into the VACC in Victoria, but all their manufacturers—small, medium and large businesses—are desperate for a transition plan to help them do other things in the economy. Of course, we need a transition plan for the existing car makers to ensure that the R&D and the engineers stay in this country so we can still be a driver of innovation.

Defence procurement is important, as we know from the German bid. I understand that something like 2,000 companies could be involved. Local businesses and small businesses could be involved in any local build of a submarine, which is absolutely critical to South Australia. The government needs to say that, because of the unemployment rate, because of the evidence given to the Senate inquiry on shipbuilding to date, taxpayers will unambiguously get better value for money in the medium and longer term by having submarines built, maintained and sustained in Australia. If you build something here, it is cheaper in the longer term to sustain it here as well. But the impact on small businesses in terms of confidence and having a strong economy and strong jobs growth is absolutely critical.

We can have all the best provisions to tackle unfair contract terms in the world but, unless small businesses are thriving, prospering and making goods or providing services in the marketplace, where there is demand for their goods and services, this legislation is somewhat hypothetical. We need to have a strong basis of demand and growth for the small business sector to prosper.

So I look forward to the debate in the committee stage of this bill. I look forward to the government explaining the concerns expressed by COSBOA, dealing with the Greens amendments, which I think have a lot of merit, and also dealing with the concerns of the Australian Bankers' Association, which I think on the face of it seem quite reasonable. So I look forward to the committee stage of this bill. I again commend Minister Bruce Billson for his very hard work in this area.