Paul Fletcher (Bradfield, Liberal Party, Parliamentary Secretary to the Minister for Communications) Share this | Hansard source

It would seem that the Leader of the Opposition has discovered the Net! All of a sudden, he is keen on technology. Previously, he was more interested in netball than the Net! Nevertheless, we welcome him to the field. He is a bit late to the field, but we welcome him, because we can all agree that the transformation to a knowledge economy is a major force affecting Australia's economy. According to Deloitte, in their report The connected continent, the digital economy was already worth $79 billion, or 5.1 per cent of GDP, in 2013-14. We can all agree that start-up companies are enormously important when it comes to job creation. According to the OECD Science, Technology and Industry Scoreboard, a third of job creation in the business sector comes from young firms with fewer than 50 employees.

But the key policy question that the Leader of the Opposition needs to answer if he is prosecuting the case, as he asserts baselessly, of the government's failure to plan for the jobs of the new economy is: how are the things he is talking about going to solve the problem? How, with just one speech in reply to the budget, he can fix it all with lots of bad promises? He really faces three fundamental problems: firstly, Labor's deeply underwhelming track record in this area; secondly, his failure to recognise that there is an enormous amount going on, and the Abbott government have a plan which we are executing, we are actually doing things while the Leader of the Opposition is simply talking; and, thirdly, the ideas that he has come up with are, in many cases, half baked.

Let us look at Labor's poor track record. Let us talk about employee share ownership plans. There is nothing more important to innovative start-up companies in the technology sector than being able to attract and retain talent and being able to do so using the remuneration tools which are standard practice in the new economy around the world. In the United States, in Israel, in tech sector hot spots all around the world, it is vital to be able to offer your employees share options so that they can share in the upside of the company if it goes well, so that you can attract smart people away from the big corporates by giving them a share in the upside.

So, what did the Labor Party—this friend of innovation, this friend of the new economy, this champion of jobs for the future—do in those grim, dark days was, bizarrely, the Treasurer of Australia? What did Labor do? Labor deliberately changed the tax law to make it effectively impossible for start-up companies in the technology sector to use employee share schemes. They changed the tax treatment so that employees were taxed in the year in which the options were issued. Rather than it becoming an incentive, it was something employees ran away from, realising they would be hit with a big tax bill on options which might well be worthless—because Labor never understand the nature of risk in business. It is just not in their DNA.

Thankfully, after those grim, dark days there is light on the horizon thanks to the unyielding champion of small business, innovation and technology—the Minister for Small Business, the member for Dunkley, who I am delighted is in the chamber now, and who is an unflinching champion of reform in this area. The Abbott government is the friend of the technology sector. We have reversed the way the technology sector was betrayed by Labor in government. Let's have a look at Labor's approach when it came to funding cuts in science—in the 2011-12 MYEFO Labor cut $400 million over three years from students studying maths, statistics and science. In the 2012 budget, they cut a further $314 million over four years. Labor, in total, cut $1.3 billion from their own policies designed to encourage students to take up science and maths, and now the Leader of the Opposition expects to be believed, and expects to be taken seriously, when he has his late road to Damascus conversion on the question of boosting science, technology and maths.

Let us be clear—there is no disagreement. These are vitally important policy objectives. That is why the Abbott government has a comprehensive and well executed set of initiatives designed to stimulate innovation, designed to stimulate activity in the start-up sector, and designed to get more children and high school students to study engineering, maths and science in high school, and engineering subjects in university. A whole suite of measures were announced in last year's innovation and competitiveness statement. The Leader of the Opposition expects us to believe that he is onto something new, but he is well behind the game.

The Abbott government is getting on with this: $12 million was announced last year for improving education in the vital science, technology, engineering and maths subjects; $3.5 million is provided to ensure that all students have the opportunity to study coding and computer programming; there is some $7 million for innovative resources for maths; and $500,000 to introduce an innovative P-TECH school—with vocational education giving people the opportunity to pick up vital IT skills they can then use in the workforce. We have allocated $188 million in key growth areas—advanced manufacturing, food and agribusiness, medical technology and pharmaceuticals, mining equipment technology and services, oil, gas, and resources.

What is the key theme here? The key theme is connecting research with the private sector and with business, because we can all agree that we want as many jobs as we can possibly have, and as much economic activity as we can possibly have in the technology sector in innovation, but what we need is the private sector to be delivering those jobs. Government has an important role, but Labor, time after time, defaults to thinking that government can solve everything with the wave of a hand. Instead of Labor's misguided approach, we have a comprehensive set of measures from the coalition. Again, the Minister for Small Business is leading this work. We have committed to removing impediments from crowd-sourced equity funding so we can take advantage of the efficiencies of the internet to raise capital quickly for businesses. We have announced, just recently, in a joint announcement from the ministers for health, education and industry, a strategy to boost the commercial returns from research. So there is a clear and comprehensive set of measures from the Abbott government precisely designed to facilitate the transition of our economy, and to make sure that our economy continues to generate the jobs that we need for Australians as the technological transformation occurs—the transformation we can all identify and agree on.

Unfortunately, it is a lot easier to identify the issues than to come forward with a comprehensive and credible plan. It does seem that the Leader of the Opposition has fallen prey to the temptation to come up with a set of measures that sound good politically but do not stand up to a great deal of scrutiny. For example, we had this half-baked plan to write off the HECS debts of 100,000 students studying science, technology, engineering and maths. That sounded great, except it was not at all clear how much money was actually going to be allocated to it. Initially they said that it would cost $353 million. Then they changed their mind, to $45 million. None of those numbers are relevant because the credible estimate here is the estimate from the Department of Education—$2.25 billion. It was not even clear whether Labor were talking about 100,000 students—as they initially said—or 20,000 students, and we certainly never got a clear explanation as to how, of the 184,000 students who are presently studying these subjects, they would choose the ones who were to benefit from this reduction. It sounds great, but when you study the details it simply does not stand up.

We had the objective of increasing the numbers of students studying science and maths. Again, we can all agree on the objective, but when you dig into the details it seems that even the state Labor education ministers will not agree to the plan presented by the Minister for Education, under which there would be a transition over a five to ten year period to make one of science or maths compulsory in years 11 and 12. The Opposition Leader can come into the parliament and give a soaring speech on budget reply night, but it turns out that the practical details have not actually been sorted out with his Labor state counterparts and, because the Australian Education Union does not like the idea, the practicalities mean that a specific measure to encourage maths and science education have not been thought through.

We heard about the $500 million Smart Investment Fund. Again, it sounds great, but there is no explanation about how this is going to overcome the difficulties that the Innovation Investment Fund struck under the Rudd-Gillard-Rudd government, when, of the three managers who were allocated funding, two of them had to hand back their mandate because they could not succeed in raising matching private sector funding. So let's be clear. We can all agree on the objectives, and the Abbott government has a clear plan across a whole range of fronts to deal with the transition of our economy. Sweeping statements not properly researched or substantiated are no substitute for the sustained action of the Abbott government.

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