Gai Brodtmann (Canberra, Australian Labor Party) Share this | Hansard source

Mr Deputy Speaker. Those opposite will recall the amount of form-filling any small business had to do in 2000 when the GST came in which made us realise that, basically, the GST was extraordinary. Every month we had to fill out a form about how much we had made and then pay tax to the ATO. There are no forms for small business attached to this carbon price.

Fact—the carbon price is paid by fewer than 500 of our largest emitters for each tonne of pollution they produce. Some of these emitters, as we have always acknowledged, will pass on their costs. The Treasury modelling shows that the average price impact across the economy is only 0.7 per cent. It is true that small businesses will largely experience this price impact through higher energy costs. There are three important issues in relation to this. The cost increases for small businesses are modest, these costs can be passed through to consumers, and the government will provide support to small businesses—and I will outline those later in my speech.

Data provided to the government by the Council of Small Business Australia—and I saw Peter Strong this morning at a business breakfast-lunch—shows that the electricity cost of a typical small retail business makes up less than two per cent of total costs. On the basis of the Treasury modelling the cost increase of the carbon price will therefore be only 0.2 per cent of overall expenditure of the typical small business, not the Armageddon predicted by the member for Herbert. In addition, New South Wales electricity distributors have provided data to the Independent Pricing and Regulatory Tribunal that the typical small business uses around 10 megawatts of electricity each year. When we apply the Treasury modelling electricity price impact to the IPART usage data, we find that carbon price would increase the typical small business power bill by around $5 per week. That is hardly the Armageddon that the member for Herbert is predicting. That works out to be about $20 a month and about $240 a year.

This modest cost increase can be passed through to consumers. That is why the government are providing assistance to households in the form of tax cuts, and increases to the pension, to family tax benefits and other payments. It is because costs are passed through the consumers. Nine out of 10 households, as we have said many, many times, will receive some assistance. We are also protecting consumers and small businesses by investing in an ACCC hotline so that if they are being overcharged they can get in touch with the ACCC hotline and report it.

The government are strongly committed to assistance and support to small business. We have introduced an increase in the small business instant asset write-off to $6,500. This provides an immediate income tax deduction for small businesses for the cost of depreciating assets. There is no limit to the number of items that can be written off in a financial year. To compare what will happen under this instant asset write-off process, if you buy a new $3,000 computer for business use after 1 July 2012, you will be able to write off its entire cost at tax time. Under the old arrangements you would only be able to write off $450 in the first year. Together these new tax breaks for small businesses are worth more than $3.7 billion over the next four years. That is significant savings for small business and significant cash in small business bank accounts as a result of this asset write-off. In addition, we have introduced a range of other small measures. This asset write-off is a particularly valuable policy initiative because it can help in many ways, as I said with the computer purchase, but also it gives an impetus for small businesses to invest in energy efficiency that can reduce electricity bills.

The whole community would be better served by the Leader of the Opposition and those opposite, including the member for Herbert, by telling the truth for a change. Come Sunday morning, rest assured, I will be able to go down to my local newsagent and buy my obligatory rocky road and the newsagent will still be open. I will be able to go to my local IGA, my local milk bar, and buy my milk and the shop will still be open. There will not be an Armageddon, a locked up and barren streetscape. The shops will be open, they will be vibrant and they will be operating. The world will not come to an end.

I just want to talk about some of the experiences that I have when I wander around and talk to small businesses in the community. I do not get the Armageddon that is painted by the member for Herbert—quite the contrary, actually. Recently I did a business walkaround. I do them regularly, once a week when we are not sitting. I went into the butcher in Garran. His business is going very, very well and the issues he raised with me were local government issues. He was very grateful for a development that was taking place down the road. I know that some residents in the area have problems with that development, but he was grateful because it was bringing more people into his business. I also went to the baker in the Garran shops. They have their own set of challenges in terms of competing with supermarkets, but they are challenges that they were facing. Unfortunately, there were not any candlestick makers at the Garran shops, but I will keep my eyes open and next time I will go and try to hunt down a candlestick maker in Canberra and have a chat with them.

In Canberra we have nearly 15,000 small businesses in my electorate alone. Recently I also went to the Torrens shops. At the Torrens shops the issues that were raised with me were lighting and the facilities around the shops. Every business there suggested that business was steady—again, not the Armageddon painted by the member for Herbert.

This morning, as I mentioned before, I saw Peter Strong from COSBOA and I chatted with a number of small business leaders here in Canberra. The issues that they raised with me were government procurement and the difficulty of small businesses actually getting access to government procurement. There was not one conversation, not one mention of the carbon price.

There is a lot more that Labor is doing in supporting small business. We can mention the instant asset write-off of $6½ thousand. We have also extended the Small Business Advisory Services, established a Small Business Commissioner, and established the Superannuation Clearing House. We have standardised business registrations, saving businesses $1,000. Labor has introduced a number of measures to help, support and provide assistance to small business. Come 1 July, there will not be the Armageddon that the member for Herbert predicts. I can assure the member for Herbert of that.

What small businesses in Canberra do have to worry about is a repeat of the experiences of 1996. Remember 1996 here in Canberra when 15,000 Public Service jobs were lost? Those opposite are predicting between 12,000 and 20,000 Public Service job losses, although the number keeps going up. If you want to see an adverse impact on small business in Canberra, that is what you get. (Time expired)

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