Doug Cameron (NSW, Australian Labor Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

The first thing I want to say is that Labor will support this bill, the Treasury Laws Amendment (Accelerated Depreciation for Small Business Entities) Bill 2018. It will extend, for another year, a measure first introduced in the 2015 budget—which was described then as Tony's tradies' budget—which allows small businesses to immediately deduct purchases of assets they start to use or install ready for use that cost less than $20,000. Over the forward estimates, the measure will cost $350 million.

Labor supported the initial measure, which went from 12 May 2015 to 30 June 2017, and Labor supported the measure when it was extended for another year to 30 June 2018 in last year's budget. It's also a good reminder that it was Labor in government that originally recognised the value of an increased immediate deductibility threshold for small business entities. Labor successfully increased the threshold from $1,000 to $6,500, as part of a broad package of tax reforms contained in the Tax Laws Amendment (Stronger, Fairer, Simpler and Other Measures) Bill 2011. Labor subsequently opposed the Abbott government's decrease in the threshold from $6,500 to $1,000 announced in the 2014-15 budget.

Remember the 2014-15 budget—that disaster of a budget from a disastrous government and a disastrous Prime Minister? It cut family tax benefits, cut health, cut education—cut everything that ordinary working-class people relied on to get a decent life in this country. That's what the 2014-15 budget was about. It cut funding for housing; it cut funding for homelessness—it was an austerity budget that was so cruel, from that rabble of a government. It hasn't got any better, has it? Has it really got any better under this government?

So what have we had? We've had Prime Minister Abbott knifed. We've had Prime Minister Turnbull knifed. And we've got Prime Minister Morrison, who will get knifed—we know that, don't we? We know that he's going to get knifed next. What did we have the other week? We had the bullies out there doorknocking. Knock, knock. 'Who's there?' 'It's Senator Paterson. I'm the enforcer, with my little pink list. You've got to sign the list.' Remember that? It was only a couple of weeks ago. They all started laughing when they opened the door and saw who the enforcer was. He's not much of an enforcer. No wonder you couldn't get the numbers when Senator Paterson's your enforcer! What a joke—Senator Paterson the enforcer! My goodness! The baby-faced assassin! There was that 2014-15 budget, and then the nonsense we had here. What a pair of book ends. You had an austerity budget, and then you knifed your second Prime Minister.

We were unsuccessful with our opposition to the measure. But, as mentioned earlier, with the 2015 budget, the government saw the light. And Labor has supported the government's measure since that time.

We know that these types of measures provide a tangible benefit to businesses and their investment plans. It's why, earlier this year, Labor announced the Australian investment guarantee, which will allow all businesses to immediately write off 20 per cent of all their new investments in tangible and intangible assets in the first year, with the balance depreciated in line with normal depreciation schedules from the first year. This will improve cash flow, making more attractive those marginal projects that otherwise may not get off the ground.

Our Australian investment guarantee will drive new investment in plant, machinery and equipment, but it will also drive investment in knowledge assets, supporting new investments in the new economy that embody more innovation and human capital—from firms expanding the capacity of their factories in outer-metropolitan areas and farmers wanting to buy the most sophisticated trucks and machinery in regional areas to advanced manufacturers wanting to upgrade their computerised technology in Australia's cities. Our policies will support them.

Take, for instance, a food manufacturer operating in regional Australia, a company that wants to spend $6 million upgrading to new energy-efficient freezers to ensure it can store its growing stock of food. Our plan would help deliver the investment because it would deliver an immediate cash flow of $1.2 million, money that could be used to hire new employees and continue their business development in Asia. Not only would this company get the instant cash flow benefit but the new freezer equipment would help reduce the carbon emissions intensity of the production process by 33 per cent and, due to the improved energy efficiency, would result in savings of up to $500,000 in energy costs.

As soon as you talk about energy efficiency or reducing carbon pollution, you can see that mob on the other side squirm—those who would knife their Prime Minister, those who would just attack a Prime Minister and those who would demolish the NEG. You know the NEG that was going to save everybody so much money, the NEG that was so clever, the NEG that was passed in the party room twice? Do you remember that? It's gone as well. That's because the extremists, the climate change deniers, the loopy deniers on the other side wouldn't let it go through, and they knifed another Prime Minister because that Prime Minister dared to have some common sense about how to deal with climate change in this country.

Recent modelling by the University of Victoria shows that, compared to a straight cut in the company tax rate, an investment concession like Labor's investment guarantee would actually be up to three times more effective as a stimulus to investment. The most growth-enhancing part of the United States's tax package is the immediate expensing element. Drawing on IMF analysis, Saul Eslake has pointed out that, in relation to the US tax plan, the thing that's providing the boost is not the company tax rate; it is the immediate expensing of investment. This mob sitting across from us, the muppet show that we've got across there—even their own leader describes them as a 'muppet show'—went from pushing $80 billion of tax cuts for big business to capitulating on that. They've never had an economic idea that has lasted more than a few months. They are absolutely incompetent and an absolute rabble of a government. The sooner they get to an election and the people of Australia decide on their incompetence the better.

Our plan is a real plan. It's permanent and won't be subject to annual budget cycles like the government's instant asset write-off. The government's corporate tax cut does not guarantee any new investment for each budget dollar spent. Ours does. Their corporate tax cut can go directly to paying for share buybacks and dividend increases either here or offshore, not new investment. Our measure, Labor's measure, has been supported by the Australian Chamber of Commerce and Industry. In their pre-budget submission, they called for more incentives for business to invest, specifically arguing:

… the government should adopt the Opposition's proposed enhancements to accelerated depreciation.

Their mates in ACCI are telling them to adopt Labor's policy. The business groups in this country must be aghast at the incompetence of the muppet show across the chamber. They must be aghast at the lack of economic credibility. They must be aghast at the incompetence of a government that can't focus on the needs of the Australian public, the needs of Australian business, the needs of Australian workers. All they want to do is focus on each other and knife each other.

This new cabinet that's in place must be a really happy place to be. They're probably looking around to see who's got the little Australian lapel badge on, to see whose side they're on. What a joke this muppet of a government is. I see the Australian Chamber of Commerce and Industry supports Labor's policy more than any failed Liberal policy. ACCI CEO James Pearson said:

"Business welcomes this commitment from the Opposition—it's good policy …

"What's particularly positive is the proposal to make this a permanent feature.

"This is important as policy certainty and policy consistency is critical for business.

Do you hear that? This is what your mates are saying. They want policy certainty. They want policy consistency. They don't want a NEG going to the party room, getting passed twice, and then the extremists in the party destroying a Prime Minister and destroying your now Deputy Prime Minister's policy. What a joke you are. No wonder your own leader called you the muppets. No wonder. He's probably trying to be kind to you lot. Ai Group Chief Executive Innes Willox said:

The Investment Guarantee would provide a significant boost for businesses to invest particularly for longer-lived investments.

The proposed measure comes at a time when business investment, and particularly non-mining investment, has been slow to recover in recent years.

As a measure designed to lift investment, the Investment Guarantee would increase the stock of invested capital, boost the quantity of capital per worker, raise productivity and underwrite an acceleration of real wage growth.

Again, your mate at the AiG, Innes Willox, recognises the superiority of the Australian Labor Party's policy, because the Australian Labor Party is focusing on business. The Australian Labor Party is focusing on working families. The Australian Labor Party is focusing on those who need a hand up in this country.

We're not focusing on knifing each other and being described by our own leader as muppets. We're not doing that. We're not a rabble like you lot are over there. You're an absolute rabble of a government, a government with no credibility, no standing in the community, no capacity to deliver economic policy, no capacity to deliver environmental policy and no capacity to deliver decent rights for working people at work. What a joke you lot are. What an absolute joke.

It is absolutely clear that even the National Party want to distance themselves. When the Deputy Leader of The Nationals was asked, 'Why did you knife the Prime Minister? What was the reason for this?' she couldn't answer, because she doesn't want to associate herself with the extremists. The National Party don't want to associate themselves with the Liberal Party. Look at what happened in Wagga Wagga when you took the name Liberal and ran with the name Liberal in what was one of the safest seats in the state assembly. Decimated. Absolutely decimated. It's a 30 per cent reduction in where you were from the previous election. This is a government that is absolutely chaotic.

The Energy Efficiency Council said this about Labor's policy:

A new Federal Labor policy that gives an immediate tax deduction to businesses that invest in energy saving equipment would help slash energy bills …

We've actually got something that will help slash energy bills. The Energy Efficiency Council recognises it. The AiG recognises it. ACCI recognises it. The only people who don't recognise it are the muppets across the chamber, who are so busy fighting each other, worrying about each other's position and not worrying about business, not worrying about the community, not worrying about Australia's economic capacity.

Ken Morrison, the Property Council of Australia chief executive, says:

… the Australian Investment Guarantee would be a powerful tool for accelerating energy efficiency gains across different industries, but especially in the built environment.

He says:

We welcome Federal Labor's announcement of this policy and the potential it has to help reduce costs for consumers.

So, there's another businessperson. Businesspeople know who are focusing on the real issues: Bill Shorten and Chris Bowen. They are focused on the issues that are important to the Australian community, focused on the issues that are important to working families, focused on the issues that are important for people who are down and out and are needing help in this country.

We know what it's about. Even Peter Strong from COSBOA, one of the biggest apologists for the Liberal Party in the business community, says:

Labor's announcement is a welcome one as it would make it easier for Australian businesses to invest and grow. The fact that this measure is available to all businesses, big and small, is also very positive as it will help small businesses directly as well as encouraging larger businesses to invest in the products sold by small business.

So, even your cheerleader in small business recognises that Labor's policy is the policy to go with.

Tanya Barden, Australian Food and Grocery Council CEO, says:

This initiative will go a long way to encouraging investment in high tech and high skilled projects to enhance efficiency and increase scale. We are particularly supportive of the Australian Investment Guarantee's inclusiveness across the industry sector. The opportunity to use this Investment Guarantee towards energy saving projects is also very important.

So, Labor will support this bill. It's disappointing that this chaotic government, this government that their own leader describes as the muppets, could not get its act together to have this legislated sooner, to give certainty to small businesses.

Business recognises the need for certainty. If business looks at the disgraceful performance of this government—and I put the word 'government' in inverted commas when I'm talking about the muppets—this is a group of people who are only interested in looking after themselves, in knifing each other in the back; they are not interested in the welfare of our industries or of our communities. They are completely distracted. They are in there, bullying each other, when the knock comes on the door from Senator Paterson, the baby-faced enforcer.

What's this all about? This should be a government that actually understands the issues of importance to the Australian community. Remember how they were going to be the grown-ups in the room? Remember that? Do you remember that they were going to be an effective government? Well, they are hopeless. No wonder your current leader calls you the muppets. It doesn't matter whether or not you've got a little Australian flag badge on your lapel; if you're a muppet you're a muppet. It doesn't really matter. Why should any politician have to wear a badge to tell them who they should be supporting? You don't need a badge to support the Australian community. You don't need a badge to support Australian industry. You need common sense. You need cohesion. You need leadership. You need to deal with the real issues—something the muppets across this chamber will never get. The sooner we get to an election and the sooner you lot are consigned to the bins of history, the better.

Nick McKim (Tasmania, Australian Greens) Share this | Link to this | Hansard source

I rise to speak on the Treasury Laws Amendment (Accelerated Depreciation for Small Business Entities) Bill 2018. As a Tasmanian senator, I want to give a shout-out to all of the small businesses in Tasmania. We're not a head-office economy down in Tasmania. Our economy is driven by the small-business sector right across a range of areas. Small business in Tasmania has supported a number of Greens initiatives over the years, including when we ultimately successfully led the charge to see an effects test pass through both houses of this parliament. The Liberal Party, who hold themselves out as the champions of small business, had to be dragged kicking and screaming by the Greens and, interestingly, the National Party to put in place an effects test which would actually go some way towards levelling the playing field in regard to matters between big business and small business.

It's also gratifying to know that the small business community supports the Greens' intention to legislate to do something to require big business and government to more promptly pay their invoices owed to small business. It might interest senators to know that, in fact, Australia and—would you believe!—Mexico are the two countries in the world where the length of time it takes big business to pay invoices to small business is the highest. Big businesses and governments are effectively using small business as a bank giving interest-free loans by refusing to pay on reasonable terms and within a reasonable time frame, in some cases extending their default time frame for paying invoices for small businesses up to and beyond 90 days. That is unconscionable, and something needs to be done about it. That's what the Greens intend to do.

In 2014, when the Abbott-Turnbull government slashed the instant asset write-off threshold from $6,500 to $1,000, the Australian Greens opposed that cut. We backed in the Henry tax review recommendation that the $6,500 threshold be increased, not decreased as it was by the Liberal government at the time. Remember that this is the Liberal Party that likes to paint itself as the champion of small business, when in fact what we all know and what any reasonable assessment of reality would lead us to conclude is that actually the Liberal Party is the party of big business. It is the party of the corporates. It is the party of privatising public assets and allowing the profits to be privatised but the losses and the impacts to be socialised. And, of course, it's people and the environment that continually miss out when that happens.

So, because we back small business, we supported the government's backflip the following year after the 2014 decision to slash the instant asset write-off threshold from $6,500 to $1,000. The following year the government backflipped and raised the threshold to $20,000. That's why we will be supporting in this place today extending this scheme for another 12 months. But, as Senator Cameron has just finished so eloquently pointing out to this chamber, doing this on a rolling 12-month basis just so you can create for yourself a few positive headlines in the media and a round of applause from the small-business community is not good enough. The government ought to make this permanent. In fact, there are very strong arguments for the threshold to be raised above $20,000.

This form of accelerated depreciation allows you to reduce your taxable income by $20,000 under certain circumstances, resulting in a cash flow benefit relative to the rate you've been taxed at. That means more money for small business to reinvest in more equipment or to employ more staff. I will place on the record that I have worked in many small businesses over the years and even had one myself for a while, as a sole trader, so I know what it's like to work in and own and operate a small business. It is often hard yards. There are often people working incredibly long days, weeks, months and years to keep their businesses afloat, and often the owners of those small businesses do not pay themselves anywhere near a reasonable wage or salary because they would prefer to see the money that would come to them actually reinvested back into their businesses.

The Greens have a view that instant asset write-offs are an incentive for small businesses to reinvest money into their operations, which is good for the businesses, good for the suppliers of those businesses and ultimately good for customers and the broader economy. The Greens believe that this bill should go further than it does. Therefore, in the Committee of the Whole we will be moving an amendment designed to help small businesses cut pollution and cut their power bills.

This is about many things. It's about reducing emissions and assisting small business to play a role in the fight against the climate disruption that is happening around us as we speak. But it's also a way to help small businesses reduce their costs. We are proposing that we create a new write-off scheme, introduced with a $30,000 expenditure limit, to be used when small businesses spend capital on assets relating to clean energy or energy efficiency. Specifically, the asset would need to be used in connection with investing in energy efficiency, in reducing fossil fuel use or in fuel switching from gas to electricity. All of those three things will reduce emissions. The first, energy efficiency, will clearly deliver a further financial dividend to small business by reducing their power costs, and transitioning from gas to electricity, or reducing small business' use of fossil fuels, which is also very likely to reduce their costs. We are proposing that this be introduced in addition to the existing $20,000 tax break that was extended for another 12 months in this year's budget. Furthermore, this would be a permanent scheme, not the temporary 12-month arrangement that the government seems wedded to.

We will move this amendment in the committee stages. It is to incentivise small businesses to invest in energy efficiency, reducing use of fossil fuels, and fuel switching from gas to electricity. This is a win-win policy suggestion from the Australian Greens. It's good for the environment because it will help small businesses play a role in reducing Australia's greenhouse gas emissions, it is good for the bottom line of small businesses, which we all know are the engine room of the Australian economy. It's also worth pointing out that small businesses are a very large part of the backbone of local communities right around Australia, because not only do they provide significant regional employment in this country but they are often a sponsor who will step up and assist local sporting clubs and other local groups to thrive and prosper and in some cases even assist those sporting clubs and other groups to remain viable.

I'm not going to take from the Liberal Party that the Greens are against small business, something that I hear regularly from the Liberals. I remind people listening of the Liberal Party's track record in protecting big business by its refusal to take strong enough action to crack down on corporate tax avoidance. If that were to happen, it would allow us to force the big corporates to pay their fair share of tax and then invest that money into improving the quality of public services in this country, which the Australian Greens absolutely believe in and which we believe the majority of Australians also support.

It's important that people understand that, in fact, the Liberal Party is the party of the big corporates in this place, because they are bought, lock, stock and smoking barrel, by the tens of millions of dollars of corporate donations that they receive every year from the top end of town.

Senator Seselja interjecting—

Senator Seselja can seek to interject all he likes, but we've seen the revolving door that exists when senior coalition ministers, senators and MPs have rolled out of this place after having done the bidding of the big corporates for decades in here. They, having accepted the grubby donations either on a personal level or at a party level from the big corporates, then roll straight out of this place and into the corporate boardrooms. We've seen it time after time after time. It's worth pointing out that the Labor Party's not immune to this disease either. It's a disgrace and it ought to be stopped. The Greens have a policy that it needs to stop and a plan to make sure that there is no capacity for that revolving door to continue. When you're in this place, you should be serving the people; you should not be serving the corporates as your primary aim.

We have seen time after time the corrupting influence of big money and big politics. It's part of the reason why the Liberal Party is still refusing to support a national anticorruption body. It's part of the reason why we still have massive subsidies for the fossil fuel sectors contained in every budget. It's part of the reason why we see the Liberal Party wedded to big tax breaks for the big corporates. We've got to break the nexus between big money and big politics in this country. Until we do it, our body politic will not be delivering the most optimum outcomes that it should for the Australian people and the environment. We need to see not only the handbrake pulled on the privatisation agenda but also a renationalisation of some assets that in the past have been privatised. When we've privatised many of the assets that we've seen transferred from public ownership over to the private sector in past decades, we have seen poor outcomes for the environment and poor outcomes for far too many people. Wealth inequality in this country is growing. There is too much wealth owned by too few at the top end, and not enough to be shared out amongst far too many people, many of whom are struggling and doing it tough on a day-to-day basis.

We are very happy to support this legislation. We believe that the government should actually make the $20,000 instant asset write-off permanent, as opposed to rolling it out in 12-month increments. We also believe there is a very strong argument for increasing that $20,000. It will be very interesting to see the policy positions put by all parties before the Australian people in the lead-up to the election that we will have within the next nine months or so. But we also want to create a scheme with a $30,000 expenditure limit that would incentivise small business to invest in energy efficiency; to bring emissions down; to reduce their power bills; to reduce their use of fossil fuels, which, of course, would also bring emissions down and be likely to reduce power bills; and to switch fuels from gas to electricity, which would also, in many parts of Australia, bring emissions down and be highly likely to reduce business costs and, therefore, boost the bottom lines of small businesses.

James Paterson (Victoria, Liberal Party) Share this | Link to this | Hansard source

I'm very pleased to rise to contribute to this debate, and very enthusiastically so following on from Senator McKim, my Greens colleague from Tasmania, particularly after hearing about how passionate the Greens political party is about small business. We heard very strongly there from Senator McKim how much the Greens support small business. The Greens love small business so much that they want all businesses to become small businesses, even businesses that are currently large businesses! Of course, that's what would happen to those businesses if we implemented the Greens' policies. If we followed the Greens' economic prescriptions and applied their economic policies, those businesses which are currently large would end up become small because they would have to shrink due to the pressures of the Greens' policies on their businesses. So the Greens really do love small business; they want every business to be a small business. And I presume that they want to prevent small businesses from growing to one day becoming medium-sized businesses or—God forbid!—even a large business, employing lots of people, contributing to their community, providing services and, yes, paying tax that contributes to our wealth as a nation.

I was genuinely pleased, though, to hear Senator McKim announcing the Greens' support for this very important initiative, and, in fact, that the Greens believe that it does not go far enough and that we need an even higher threshold for small businesses in instant asset write-offs. That's a welcome initiative. I think it's probably the first time—and maybe the last time—that the Greens will outflank the coalition to the right on an economic issue and propose a larger tax cut than what we're proposing!

Senator McKim interjecting—

But, Senator McKim, it's a good positive trend; I hope it continues. I look forward to you proposing larger personal income tax cuts than the coalition and larger company tax cuts than the coalition. Of course, if you follow your own logic through to its logical extension, if a $20,000 instant asset write-off is good then a larger one would be better. Where else could we apply this logic? If a cut to personal income tax at a certain level is good, then a larger one would be better. And if a cut to company tax would be good then, presumably, a larger one would be better. Senator McKim said himself that it would encourage businesses to invest more, to grow more and to employ more people. I like this line of thinking from the Greens.

I have to commend, in all sincerity and genuineness, Senator McKim's more thoughtful contribution to this debate than other senators' contributions to this debate. I disagree with only one thing in particular that Senator McKim said, which was to commend Senator Cameron on his eloquent contribution. I think that was unfair and unjust praise. Basically, in Senator Cameron's 20-minute rambling contribution to this debate we had 18 minutes of political abuse that ranged across leadership changes, the 2014 budget and Senator Cameron's observations on various political machinations. There was very little actually about the bill before us here today. But it is true that buried deep inside Senator Cameron's speech was also another piece of good news, and that was that the Labor Party will be supporting this piece of legislation. The Labor Party will be supporting our initiative to lower taxes for small businesses, and that is a very welcome thing. I thank Senator Cameron for that.

I wonder why it was, though, that Senator Cameron spent so much time of his speech making observations about leadership changes. It certainly couldn't be because the Labor Party is immune from such things. It certainly couldn't be because he hadn't participated in any of those previously—we know well that he did and we know well that they have. I wonder why he focused so much on a budget now delivered four years ago?

Perhaps it's because the Labor Party's own record in the area of small business taxation is not so much to write home about and not so much to boast about. Earlier this year, we had the embarrassing situation where the opposition leader, Mr Shorten, appeared to announce the Labor Party's policy on small business accidentally in response to a question from a journalist that he was door-stopped by while walking out of a breakfast function. He then had to scramble over several days after his poor colleagues were left out there hanging agonisingly in radio and television interviews. There was a particularly memorable one from a Tasmanian colleague of Senator Cameron that doesn't bear repeating in this chamber because it was painful to listen to. Finally, Bill Shorten was dragged back, kicking and screaming, to a more sensible small business taxation policy.

But I have to say that if I were a small business owner-operator in this country, I would not be filled with confidence in Bill Shorten's tax policy. Who knows what it will be if he is lucky enough to win the next election? Who knows what it will be by the time of the next election because of the utter chaos we have seen in that policy area from the opposition?

Turning now to the Treasury Laws Amendment (Accelerated Depreciation for Small Business Entities) Bill 2018 before us. This bill goes to the core of the Morrison government's and the Liberal Party's philosophical agenda. We back small business because small businesspeople are having a go, and when they have a go it benefits everyone: it benefits their customers, it benefits their workers and it benefits their local communities. This bill backs small business. It's part of our plan for a stronger economy.

As announced in the 2018-19 budget, this bill extends the $20,000 instant asset write-off by a further 12 months to 30 June 2019 for businesses with an aggregated annual turnover of less than $10 million. What this will do is improve cash flow for small business, providing a boost to small business activity and investment for a further year. Around 3.3 million incorporated and unincorporated businesses with an aggregated annual turnover of less than $10 million will be eligible to access the $20,000 instant asset write-off. Small-business stakeholders have strongly supported the continuation of this measure, and we've heard that loud and clear from all the peak business lobby groups, small, medium and large.

In extending the $20,000 threshold for a further year, the government has sought to strike a balance between, on the one hand, helping small business's cash flow and investment, and, on the other hand, the revenue impact on the budget. As much as we'd like to follow Senator McKim's advice that this should be increased and kept in perpetuity, it would have some budget implications, which I'm sure would have to be addressed in other ways.

The immediate deductibility threshold and the balance at which the pool can be immediately deducted is normally only $1,000. This is obviously a policy that the government has had in place for a number of years. There's some interesting data from the ATO tax return data from 2015-16 that shows that over 300,000 small Australian businesses took advantage of the $20,000 instant asset write-off in the 2015-16 financial year. Compared to 2014-15, in 2015-16, the number of businesses that claimed the instant asset write-off increased by around 60,000, and the average amount claimed increased from an average of $4,100 per small business to about $9,000 per small business.

So the evidence is in. This is a policy that works. This is a policy that encourages investment. We've seen that in the booming small business sector in this country. We've seen that in the very positive economic growth figures announced last week by the Treasurer. We've seen that in the records jobs growth, with over a million new jobs created in the last five years. We've seen that with the strong and buoyant Australian economy that the Morrison government wants to strengthen further with this and other initiatives.

I only hope that the strong multipartisan support that we've seen in the chamber today for this initiative to back small business flows over into other areas of taxation policy to support small business, because, as we all know, it is small business that employs the lion's share of the Australian workforce. Small businesses are often largely mums and dads having a go, taking a risk, employing people, supporting their local community by providing services and jobs and supporting their local community directly with sponsorship and other philanthropy. It is these people who deserve our support and encouragement. We want to see more of them, and we, unlike the Greens, want to see, one day, these businesses grow into medium and even large-sized businesses, so that they can employ more people and contribute even more to our local communities.

Eric Abetz (Tasmania, Liberal Party) Share this | Link to this | Hansard source

Small business is the backbone of the Australian economy. Small business provides the jobs and wealth our local communities rely on. So it's an absolute delight to be part of a government that is seeking to assist small business to do even better within our community. In doing even better, they will employ even more people. So this is about ensuring that the Australian small business sector has the opportunity to flourish and grow, and, in doing so, provide even more job opportunities for the people of Australia.

One of the changes that Prime Minister Morrison has made is to put small business back into cabinet. I have been arguing for that for a considerable period of time, and I am delighted that small business is now, yet again, in cabinet. Every single decision of that cabinet now has to be considered with a small-business champion sitting around the table. That is vitally important and one of the important changes that Prime Minister Morrison made in setting up his new ministry.

I recall how popular our policy of putting small business into cabinet was during the 2013 federal election, and we had an excellent small-business minister in Bruce Billson. Sadly, certain events overtook us and small business was removed from cabinet. But the good news is it is back where it ought to be, and I congratulate Prime Minister Morrison on that very important move. It is something I called for, as I indicated, quite some time ago. Our party's founder, Sir Robert Menzies, set up the 'We believe' document, the 17 principles on which the Liberal Party was founded. He stressed the virtues of hard work, personal responsibility, reward for effort, encouragement of entrepreneurship and small government. All these are virtues that underpin small business. These are the guideposts to which government and policymakers need to direct their thinking, to enable small businesses to flourish.

As someone who mortgaged everything—and then some—to start a legal practice which, amongst others, served the local business community and small-business sector, I understand the relentlessness, the commitment and the hard work required to establish and keep a small business going. When it comes to time obligations, you come last. When it comes to financial obligations, you come last. When it comes to staff leave, you fill in and work even harder. When it comes to worries and customer satisfaction, it's your responsibility.

Small business, can I say, is full of obligations but also rewards. Small business is the economic and social backbone of our society. That is why it's so important, both on an economic and social front, that we seek to advance the cause of small business, because too often the sector can rightly be described by the Menzies phrase as the 'forgotten people'. Too often you have big business, big unions and big government seeking to dictate policy. And when you have a big business facing difficulty, quite often you will see governments step in—and, possibly, rightly so; I simply make the passing observation—to assist that business. But when a small business with only one or two employees faces difficult times, they simply close the door and let the people go. And, often, the people who were the initiators of the business are bankrupted.

What we need to do is ensure that there are sufficient incentives to allow small businesses to prosper. That is why I'm so pleased to stand and support the Treasury Laws Amendment (Accelerated Depreciation for Small Business Entities) Bill 2018, which is before the Senate this evening. To continue to extend the accelerated depreciation up to $20,000 per annum for businesses with a turnover of $10 million, really, is designed to assist those very small businesses that we all hope—or that we on this side at least hope—will grow into the bigger businesses and the bigger employers of Australia. Let's remember that Qantas started with three employees all those years ago, and it's good to see that an Australian business has been able to prosper and do so well over the years.

What we need to do as a government, as a body that sets public policy, is ask: how are we able to assist all those virtues that underpin small business? There should be reward for effort. There should be the capacity to assist small business to invest and, thereby, create jobs. This is a very modest measure. We know from the evidence that the average claim, in relation to this $20,000 instant asset write-off, is only $9,000. They are small contributions but are able to make a very real difference for the small business's viability—vitally important if we are to continue to support this vital area within our economy.

Too often in these debates we hear, sadly, of envy, of jealousy, of the idea that somehow if you're in business you must be doing so much better than other people. This envy, this jealousy, is such a dark and unwelcome addition to these debates. We should be celebrating people who are willing to risk their financials to further themselves, to create business opportunities that of course provide the job opportunities that so many Australians want. This is where the engine room of jobs growth is. It is in the small business sector. By supporting the small business sector we provide job growth for the Australian people.

I recall that I was the one who made the brave announcement for and on behalf of the coalition in 2013 that we would seek to have created within the Australian economy one million jobs in our first five years. It was ridiculed. Indeed, there was even an alleged leak from a department suggesting that this could not be achieved. Well, the news is—the evidence is in—that it was achieved, and before the five years was up. The reason was that we as a government put small business front and centre of our thinking. We got rid of red tape. We wanted to incentivise small business. Bruce Billson—I pay credit to him again—did a fantastic job as the small business minister, always advocating to ensure that the cabinet of the day was looking at the interests of small business. Sure, we like small business. We believe in reward for effort. We see the virtues of entrepreneurship and people trying to better themselves, and that is good for society as well. But one of the real benefits, of course—and our major focus—was to ensure that there was jobs growth, which is so vitally important. We know that every job held by an Australian provides not only an economic benefit to that person or family unit but also substantial social dividends.

Every person who has a job is in a situation where their mental health, their physical health, their self-esteem and their social interactions are enhanced and, on average, are so much better than among those who are not in gainful employment. So, leaving people on the social scrap heap of unemployment is unacceptable from a social point of view just as much as it is from an economic point of view. Changing somebody from drawing on their fellow Australians in order to make ends meet to becoming self-reliant is a virtue in itself and something that we as a government seek to celebrate and seek to advance. We seek to ensure that everybody has that opportunity of becoming self-reliant.

The measures in this legislation are deserving of the support of this complete Senate chamber, and I would be disappointed if anybody would seek to vote against such an important measure as this—a small measure but nevertheless a very symbolic measure of our commitment and support for the small business sector. And for my home state of Tasmania: the vast bulk of businesses in Tasmania will be able to benefit from this measure. Indeed, I am told that around Australia there are about 3.3 million businesses that can actually benefit from this measure, which is so vitally important. If I recall correctly, some 300,000 Australian small businesses have now taken advantage of this instant asset write-off, and the extension of it for the next financial year is something that I am very pleased to be able to support in this place.

When it comes to the Australian Labor Party, it is interesting to note that Labor opposed and would reverse our small business tax cuts. Labor's new tax on trusts will hit at least 200,000 small businesses. Labor's energy policy, including a 50 per cent renewable target, like they had in South Australia, would increase power bills and pose a risk to reliability not only for pensioners and for household budgets but also for small businesses—not to mention, of course, big business as well. That is why I am so pleased that the new Prime Minister has indicated very clearly that the task for the new Minister for Energy is to reduce the price of energy within this country. I am sure that the new minister, Mr Angus Taylor, is well and truly up to the task to ensure that we deliver cheaper energy, which is so vitally important not only for household budgets but also for our small business community.

When it comes to small businesses, I note that the Australian Labor Party would seek to repudiate the decision of the Fair Work Commission, which they set up, which was required to make a determination under amendments that Labor made to the Fair Work Act whilst Mr Shorten was the relevant minister. The decision was made by five appointees to the Fair Work Commission, all appointed under the previous Labor government. So Labor legislation and Labor appointees, all Labor, come to a conclusion about pay rates, and the Australian Labor Party would say, 'No, we are going to override the decision of the independent umpire.' Small business deserves to be treated better than that sort of approach.

But, of course, as we know, Mr Shorten is union-bred, union-fed, union-led and will do whatever is required to keep his power base within the Australian Labor Party, especially now that the Australian Workers' Union has been pinged for having inflated its numbers in a completely unconscionable manner. Many people suspect that that huge inflation of numbers was undertaken when the now Leader of the Opposition, the current Leader of the Opposition, was, in fact, in charge of the Australian Workers' Union. I would encourage the Leader of the Opposition to give the Australian people a full explanation as to how those inflated numbers came into being. But, of course, whilst he's at it, he might have to explain a few other things that he did whilst he was a trade union leader, such as why he didn't disclose donations that he received from certain big companies in relation to campaign donations for himself.

Now that the Australian Workers' Union have been pinged, Mr Shorten is aligning himself with the militant CFMEU, an amalgamated union of the construction sector and the maritime sector—one of the most extreme unions, if not the most extreme union, in the country. It is a union that has been found to be a recidivist by the courts and fined millions of dollars for continually breaching the law. Of course, it is the sentiment that Mr Shorten said he wanted to bottle from their union over in Western Australia, the MUA, and bring it back to Canberra, if he were to become Prime Minister.

I say to every small business, indeed, every Australian citizen: be exceptionally careful when looking at what the Australian Labor Party promises, because what they won't tell you is the sort of manipulation that Mr Shorten has been engaged in with the trade union movement. It is a movement that is not dedicated to the wellbeing of the private sector, to the small business sector, to the entrepreneur and to the mum and dad who have mortgaged their house often just for the purpose of being able to earn themselves an income. The local coffee shop and the local newsagency, those small businesses, have a true friend and a true champion in the Liberal-National Party government of this country.

The reason we champion them is that we want to support those people who seek to help themselves and who provide the backbone of local communities and the job opportunities to local communities. As my friend Senator Paterson observed in his very good contribution, they also provide sponsorship to a lot of the charities and other organisations within their communities. They are part and parcel of the social fabric and are the glue that binds our communities together. Anything that is about supporting small business I support, because I know it will help create jobs that are so vitally needed in Australia.

We have brought down the unemployment rate. When you see governments that are committed to the support of small business, as in my home state of Tasmania where you have the tandem operation of a good federal Liberal government with a good state Liberal government, you can see what can occur. Indeed, in the last four years or so in Tasmania the unemployment rate has gone from 8.1 per cent down to six per cent, and it's now below six per cent. They are the sorts of things that can be achieved. There is social good in knowing that thousands more Tasmanians are now gainfully employed, are self-reliant and are able to look after themselves and that the welfare contribution being made by fellow Australians can be reduced. They are now taxpayers rather than being reliant upon the tax revenues of the country. That is the sort of economic and social change that we on this side celebrate and that we want to support to the very best of our abilities. I commend the bill to the chamber.

Dean Smith (WA, Liberal Party) Share this | Link to this | Hansard source

I rise this afternoon to make a few brief contributions to the debate on the Treasury Laws Amendment (Accelerated Depreciation for Small Business Entities) Bill 2018 and in doing so I highlight the fact that this is the latest in what has been a suite of initiatives from the coalition government over the last five years unashamedly aimed at supporting small businesses, supporting the families that operate small businesses and supporting the many Australians who get to benefit by working in small businesses or—as Senator Abetz and Senator Paterson have already mentioned—are the beneficiaries of the significant sponsorship opportunities that small businesses provide to our community.

This is the latest in a suite of initiatives, as I said. It joins small business tax cuts and the instant asset write-off initiatives. It's part of our red tape relief program and it's part of our efforts to protect businesses from union thuggery—I will come to that in a moment. It's part of our small business initiatives that drive fairer competition and exporter opportunities and, importantly, provide initiatives to support better, easier and smoother cash flow for businesses across the country. Specifically, the Treasury Laws Amendment (Accelerated Depreciation for Small Business Entities) Bill 2018 unashamedly, as I said before, backs small business as part of the government's plan for a stronger economy.

The 2018-19 budget announced that this bill will extend the $20,000 instant asset write-off by a further 12 months to 30 June 2019 for businesses with aggregated annual turnovers of less than $10 million. This will improve cash flow for small business, providing a boost to small business activity and investment for a further year. Around 3.3 million incorporated and unincorporated businesses with aggregated annual turnover of less than $10 million will be eligible to access the $20,000 instant asset write-off.

Small business stakeholders strongly support the continuation of this measure, as would be expected. In extending the $20,000 threshold for a further year, the government has sought to strike a balance between helping small businesses' cash flow and investment and the revenue impact on the budget. The immediate deductibility threshold and the balance at which the pool can be immediately deducted are normally $1,000. This is yet another initiative from this coalition government which, over the last five years, has demonstrated a strong commitment to supporting Australian businesses and to supporting the small businesses in our community who are the backbone of it.

This is particularly important because, as we start to prepare ourselves and get ready for the great electoral contest that is the next federal election, whenever that might be, often people will say: 'Why is this distinction between the coalition and Labor important?' It is because, as we've seen and heard and read about, Labor is committed to conducting a war—a guerilla war, if you like—on small business. That's a war Labor has already initiated and will continue, should—heaven forbid—they be elected to government at the next federal election.

You might ask: how is it exactly that Labor is waging a war on Australian small businesses? Let me just draw your attention to a couple of points. The first, of course, is that Labor is opposed to—more than that; Labor would reverse—the coalition's small business tax cuts. Labor's new tax on trusts will hit at least 200,000 small businesses, the people they employ and the families who run them. Labor's energy policies include the 50 per cent renewable target, which, as we've witnessed for ourselves in South Australia, would increase the cost to small businesses as a result of increased power bills and, of course, the risk to the reliability of affordable energy to those small businesses.

Critically, there is an issue that will most definitely get closer attention and that will sharpen the differentiation between the coalition and Labor at the next election, and that is Labor's plans to reverse the independent umpire's decision to modify Sunday penalty rates. It would mean that small businesses would pay higher penalty rates than big businesses do to big unions. This, I think, is a critical issue. I'm hoping that, as we get closer to the election, people will understand the very real difference here: Labor's plans on penalty rates aid and abet big unions at the expense of employment opportunities, often for younger Australians.

Of course, critically, Labor will roll over to increasingly militant unions, who have made their intentions very, very clear. They will demand a power to strike, more power to run into and control businesses and inspect their books, and more deals to entrench their power. If Labor is elected, Labor will want their union law-breakers to become instead the union lawmakers.

It's often misrepresented that the Liberal Party is the party of big business. In fact, the Liberal Party is the party of small and medium-sized enterprises and, importantly, of consumers. Everything we seek to do is to empower consumers, give consumers the best possible choices and, of course, decrease costs for consumers as they go about providing a better or more manageable cost of living.

But there is a very, very real risk, or a real choice, that confronts Australians as we go to the next election, and that is whether or not they want to give Bill Shorten, the Leader of the Opposition, real authority, because, by giving Bill Shorten and his Labor Party—and, indeed, his trade union mates—more power and authority over the Australian economy, and more power and authority over small businesses, what they'll be seeking to do is to turn this country into a trade union movement. Bill Shorten has made this statement, crystal clear: if he had his way, he would run Australia the way that he runs trade union movements. He has said that he would like to run this country like he has run trade union movements. That could not be a good outcome for small businesses. It could not be a good outcome for the families who run them and the people who work in them. And it certainly would not be a good outcome for consumers.

Why wouldn't it be a good outcome? I think the answer lies in the performance of what it is that Labor unions do. What is it that Labor unions do? We have heard a lot in the last few days about bullying, thuggery and those sorts of things, but let me just draw attention—

Senator Chisholm interjecting—

Thank you very much for that, Senator Chisholm, because I was just getting to the behaviour of the CFMEU. I was just coming to the behaviour of the CFMEU. It's not what I say about them. It's not even what you and Senator Cameron say about them. It's what Justice Mortimer of the Federal Court of Australia said about the CFMEU in 2016.

Senator Cameron interjecting—

This was in 2016. This was the behaviour of the CFMEU. Let's have look at this. I will summarise the case for you. You might even know it, Senator Cameron. You might even be very familiar with it. The CFMEU was penalised for contravening the coercion power provisions of the Fair Work Act. The CFMEU blockaded the Regional Rail Link package B project site in Footscray because the head contractors refused to employ a CFMEU delegate. I am telling this story because Bill Shorten, by his own admission, says he wants to run—

Sue Lines (WA, Deputy-President) Share this | Link to this | Hansard source

Senator Smith, I have been quite lenient. Please refer to those in the other place by their correct titles.

Dean Smith (WA, Liberal Party) Share this | Link to this | Hansard source

Mr Shorten, the Leader of the Opposition, has said in his own words that he would like to run the country like he ran the trade union movement. I am sharing this with you, Senator Cameron. I can see your face. It looks like you are familiar with the case. Are you familiar with the case? That was rhetorically asked.

Sue Lines (WA, Deputy-President) Share this | Link to this | Hansard source

Senator Smith, I remind you to make your remarks to the chair.

Dean Smith (WA, Liberal Party) Share this | Link to this | Hansard source

Let's have a look. What did Justice Mortimer of the Federal Court of Australia say in 2016? This is what was said:

… there is a conscious and deliberate strategy employed by the CFMEU and its officers to engage in disruptive, threatening and abusive behaviour towards employers without regard to the lawfulness of that action, and impervious to the prospect of prosecution and penalties.

This is how the alternative Prime Minister would like to run the country. That's a very stark warning sign for Australians, small businesses and anyone involved in enterprise in this country of the very real risk, the very real peril, should Bill Shorten, the Leader of the Opposition, get elected as the alternative Prime Minister.

The Treasury Laws Amendment (Accelerated Depreciation for Small Business Entities) Bill 2018 is just the latest measure in a suite of measures that aims to keep the Australian economy strong, that aims to keep Australians employed and that will continue to deliver strong economic growth.

Zed Seselja (ACT, Liberal Party, Assistant Minister for Treasury and Finance) Share this | Link to this | Hansard source

It's great to conclude debate on this very, very important bill, the Treasury Laws Amendment (Accelerated Depreciation for Small Business Entities) Bill 2018. I won't spend a lot of time responding, but I want to thank everyone for their contributions, even Senator Cameron, who I am not sure talked about the bill but talked about a lot of other things. Indeed, I wanted to think Senator McKim for his contribution, because Senator McKim was talking about his record when they had a Labor-Greens government in Tasmania and how much they loved small business. Well, I can tell you that small business did not love the Labor-Greens government—that is for sure.

I was reminded what the business community thought of the Labor-Greens government and their war on business. The March 2014 census business index found that business support for the former Labor-Greens government was the lowest in the country. In fact, 66 per cent or two-thirds of businesses—I would think that would be a lot of small businesses, because they make up most of the businesses in Tasmania—believed Labor and the Greens were working against them. There is no doubt about it. So that was the Greens' record on small businesses. They were out to get them. They launched a war on business which led to a recession in Tasmania, massive youth unemployment and massive unemployment across the board as businesses were attacked by the Labor Party and the Greens. So, just responding briefly to Senator McKim, that's been the Greens' record and, of course, their policies flow on from that.

Alternatively the coalition have in our DNA support for small business. We support particularly small and medium enterprises in so many ways, and this bill is another way in which we are supporting small and medium enterprises in this country. Some of the ways we have done that, of course, are with small business tax cuts across the board—significant tax cuts that we have delivered in the face of opposition from the Labor Party and others—the instant asset write-off, which we're talking about and extending through this discussion tonight, and red tape relief across the board.

Senator Smith eloquently talked about union thuggery. So many businesses suffer from that, particularly in the construction sector but also in other areas, where we see those unions' standover tactics. So we've worked very hard, particularly in the construction sector, with the ABCC and through other measures, to make sure that small and medium businesses don't have to face that kind of thuggery from the CFMMEU, which we've seen illustrated so many times.

On fairer competition laws, small businesses are getting a fair go through amendments to the competition law to stop big businesses from abusing market power, new unfair contract legislation and the establishment of a small business ombudsman. The coalition has a record of opening up free trade with other countries. When we open up free trade—as we have done with free trade agreements with China, Japan and Korea and with the TPP—it provides opportunities for Australians and businesses across the board, including thousands of small and medium enterprises around the country. The government recognises the importance of cash flow for small business, which is why we're setting an example by paying our bills on time, with 97 per cent of Australian government bills under $1 million being paid within 30 days. Cash flow is so important. I know that here in the ACT, where there are a lot of small and medium contractors who have contracts with the Commonwealth, cash flow is so critical to them, and we've delivered on that.

The alternative government, the Labor Party, have opposed so many of these measures. They opposed our small-business tax cuts. If the Labor Party were to come to office, they would reverse those small-business tax cuts that we have delivered for millions of Australian small businesses. The Labor Party would increase taxes. One of the first things they would do if they were to come into government is make small and medium enterprises in this country pay more tax so that they could employ fewer people, so that unemployment could go up and so that fewer Australians could have the dignity of a job. We've seen so many other examples where the Labor Party attack small business. They pretend that they don't, but their record is so clear, because, when it comes to a choice between their union masters and the interests of small and medium enterprise in this country, the Labor Party will always back their union paymasters.

It is a very, very important bill that we are debating today. This government does very much back business growth and investment. We have improved small businesses' competitiveness by lowering their tax rates through the legislated enterprise tax plan and the unincorporated tax discount. We've further extended concessions to small business by lifting the small-business entity turnover threshold to $10 million. As stated, this bill will continue to back small business by extending the $20,000 instant asset write-off by a further 12 months. This will allow small businesses to immediately deduct purchases of eligible assets, each costing less than $20,000, which are first used or installed ready for use by 30 June 2019. This will improve cash flow by bringing forward tax deductions, providing a boost to small-business activity and encouraging more small businesses to reinvest in their operations and to replace or upgrade their assets. Just under 3.3 million small businesses with an annual turnover of less than $10 million are eligible for the $20,000 instant asset write-off. This is an initiative which I think has very strong and widespread support. We look forward to its passage through the Senate. I commend the bill to the Senate.

Question agreed to.

Bill read a second time.