Monday, 14 July 2014
Clean Energy Legislation (Carbon Tax Repeal) Bill 2014, True-up Shortfall Levy (General) (Carbon Tax Repeal) Bill 2014, True-up Shortfall Levy (Excise) (Carbon Tax Repeal) Bill 2014, Customs Tariff Amendment (Carbon Tax Repeal) Bill 2014, Excise Tariff Amendment (Carbon Tax Repeal) Bill 2014, Ozone Protection and Synthetic Greenhouse Gas (Import Levy) Amendment (Carbon Tax Repeal) Bill 2014, Ozone Protection and Synthetic Greenhouse Gas (Manufacture Levy) Amendment (Carbon Tax Repeal) Bill 2014, Ozone Protection and Synthetic Greenhouse Gas (Import Levy) (Transitional Provisions) Bill 2014; Second Reading
I rise to my feet to talk on the amendments that the Minister for the Environment is moving. I cannot help but notice that on Monday afternoons we do not have matters of public importance debates. They are on Tuesdays and Thursdays. But, to my way of thinking, this is a matter of public importance. This is a position that was taken to the election. As much as those opposite would like to argue that they terminated the carbon tax pre-election and replaced it with an ETS, that policy was resoundingly defeated at the election. The Minister for the Environment, the Prime Minister and the government today have a solid mandate—have always had a solid mandate—to repeal this tax.
I note that I follow the member for Fairfax, because my background is in the business world, not the political world. My point of difference with those opposite is that I understand the role this tax has played in the last six years in my electorate of Reid as it has filtered through every line item in the expenses of every P&L of every local business, and that is the part that those opposite just do not get. I exclude from that the member for Indi and the member for Fairfax, because they have run businesses. They understand that a business has a revenue side and an expense side to its P&L. They understand that, through the GFC, consumer confidence was shot to pieces. People sat on their hands and saved at six times the rate they did under the Howard government. At the same time, with the introduction of the carbon tax, you had the ratcheting up on the expense side of every line item that this fed into. Every small and medium sized business in my electorate of Reid and right throughout Australia was hit with a double whammy.
Small and medium sized business, which we never talk about in this chamber as much as we should, employee 70 per cent of the people in this country. They have been and will always be the engine room of the economy. At a time when they needed us, we turned around and whacked them with a tax that filtered through every line in the expense side of the P&L. Traditionally when a business is hit with increasing costs it will increase its prices to maintain its margin. In accounting terms it is EBITDA. Due to this double whammy it was in the unique position where not only could it not do that; in most instances it had to decrease its prices. What do small and medium sized businesses do, as they have always done in times of controversy? They augment their business model.
What have been missed in this chamber are the flow-on effects that this tax has had in the real world. Not enough people in this chamber come from the real world. Their background is not in business. What happened in the streets of Reid—through Auburn, through Homebush, through Flemington, through Concord, through Five Dock, through Wareemba and through Drummoyne—is that business changed the way they operated. They did it, as they have always done, in two major ways. They augmented their trading hours or, in the case of family businesses—which are the vast majority of small businesses—they increased the hours that they worked themselves, cut casual wages and started augmenting their trading hours. These things feed in. Here is the vicious circle which businesses in Reid and throughout Australia have operated in for the last six years.
We argue about youth unemployment in this country. Everyone, on both sides, thinks this is an issue that we must confront. And they are right. But here is the kicker. Casual employment has and will always be the entree for university students and young people to find a career. In the streets of Reid it has dried up. On the western side of my electorate youth unemployment is running at 20 per cent. One in five 18- to 24-year-olds cannot find a job. Here is a light bulb moment. Why don't we get out of the expense side of the P&L of businesses and restore some profitability so that they might then put on some staff? That is what is being missed.
Australia has been built on the back of cheap power. It has been our competitive advantage. Our pay and conditions have been derived as a result. Every 1 July, based on business profitability, we have a minimum wage increase. If businesses are not profitable, we will not get that. We are seeing that now, with real wage decreases. I cannot believe that anyone could stand up in this chamber and argue to the contrary. We need to help business, not hurt it.
It was a breath of fresh air when the member for Mallee, in his 90-second statement, spoke of some innovative environmental businesses in his electorate. Last Friday I sat with one such business in my electorate, Suntech, at Sydney Olympic Park. They are the smarts for the Chinese solar energy business. The carbon tax is not important to them. What is important, in my humble opinion, from my commercial background, is how this will be attacked commercially. They told me that storage is the key. The University of New South Wales and the University of Queensland are leading the world in this space.