Peter Slipper (Speaker) Share this | Link to this | Hansard source

I have received letters from the honourable Member for Dunkley and the honourable Member for Parramatta proposing that definite matters of public importance be submitted to the House for discussion today. As required by standing order 46(d) I have selected the matter which, in my opinion, is the most urgent and important, that is, that proposed by the honourable Member for Dunkley, namely:

The adverse effects of Government policy on small businesses in Australia.

I call upon those members who approve of the proposed discussion to rise in their places.

More than the number of members required by the standing orders having risen in their places—

Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Link to this | Hansard source

Not one Labor member of this parliament stood up to support this urgent discussion about the adverse impact of its government policy on the small business community. What a surprise! That is entirely in keeping with this Gillard-Rudd Labor government strategy of talking a good game at times but certainly not lifting its game when it comes to the impact on small business. You cannot find an example where small business has been front and centre of the federal government's mind. It is of very serious concern how poorly understood and appreciated small business is by this government. We need to support our small business and family enterprise community. They deserve our support, they warrant our encouragement and they deserve considered policy that will actually support the prosperity. The coalition knows that prosperous small businesses feed into the vitality of local communities and opportunities for Australians, something this government have never understood. They continue to show their ignorance on this topic by their inaction on the matters that really matter to the small business community.

Remember the time when the Howard government was in office? We saw the number of people running their own small businesses exceed the number of union members. Small businesses were being developed right around our country, in every corner of our continent. There was a sound economic environment and supportive policies that, rightly, recognised that small business was the engine room of our economy. When you talk to operators of small businesses today they are almost whimsical about those past times. They look back to when the Howard government was in office and they recall vividly that it was a golden era for them and for the communities that they are so embedded in and such a part of. Now small businesses are looking at the end of a very long, dark tunnel and seeing that the only bright light is the prospect of an election. But they want to know how long they have to hang on. The economic funk and the despair that this government has driven small businesses into are very worrying for many small business people. As the government fails to act on the matters of key concern to small business, they are cannibalising the capital that people have invested in those businesses. They are not only demonising successful entrepreneurs but demoralising the entrepreneurs. The sons and daughters of people who are currently entrepreneurs of our country are looking at what mum and dad are having to go through. It is a bit like my LNP colleagues pointed to some years ago: in the rural community the sons and daughters of farmers were thinking, 'Gee, I'm not sure what I'm going to do with my life, but I'm pretty sure farming's pretty tough going.' This is now the mood that is undermining confidence in the small business community and impeding the next generation of entrepreneurs, who we really need. Boy, has the mood changed! Confidence is down, entrepreneurship is under attack. We have a federal government whose disposition is hostile to small business, a government wanting to talk a good game but never lifting its game in terms of the support small businesses deserve.

Just have a look at what is going on. Have a look at the state of the nation through the eyes of the small business community. Have a look at why they are feeling that this government is not interested in their interests and certainly not responding to the concerns that they have. There is an urgency and a need for decisive action to try to give small businesses the support that they need. There is a need to nurture the policies that will give us growth and economic vitality to spread opportunities. Instead, all we get from this government is more new taxes. When the Howard government left office, the ABS estimated that 5,061,000 people were employed in small businesses around Australia. That was more than half the private sector workforce; in fact, it was 51.3 per cent. Just a few short years later, in June 2009, the ABS reported that job losses in small business had already totalled 300,000 and that private sector employment that small business provided had gone from 51 per cent down to 48 per cent.

The ABS has changed its numbers and its methodology again. Rather than the government pushing off from those earlier numbers, the ABS is now saying that there are 4,747,000 people employed in small business and it is down to 47.2 per cent of the private sector economy. We are seeing jobs shrinking out of the private sector in the small business community when we should be out there trying to nurture and support growth in that area. When we look at what is going on in insolvency, we see the Dun and Bradstreet report, a very worrying report, showing that the number of small business insolvencies is up by 45 per cent and the number of new business start-ups is down by 95 per cent. This is the climate. This is the ditch that this government has driven many small businesses into. When you ask small business people what their major concerns are, they say they are worried about incompetence from a government that does not seem to understand that its actions have profound impact on the men and women in small business and they ask, 'What is the government going to do at a time when costs are punishing business?' They are just going to put costs up with the world's largest carbon tax. The Queensland Chamber of Commerce and Industry recently surveyed their members. Three out of four respondents believe that the carbon tax will have a negative impact on their business. Eighty-four per cent urge the scrapping of it in the name of their business, the jobs that they try to create and to try and stave off yet another nail in the coffin of many of those businesses. The Australian Association of Convenience Stores found that 96 per cent of their respondents in a recent survey said the Gillard Labor government's carbon tax will have a negative impact on their business and two-thirds of them said it will negatively impact on future employment levels.

You can imagine my surprise when in a recent weeks the state Labor shadow employment minister was calling on the Baillieu government to reduce taxes and charges to try and deal with the jobs losses in Victoria, a jobs crisis in Victoria, but the new minister said, 'What jobs crisis?' There is a jobs crisis. We are losing jobs because of this government's policy approach and their unwillingness and lack of preparedness to actually tackle the causes of it. That is why this matter is of such importance today.

When you look at the carbon tax, the world's largest carbon tax, you see there is barely an industry in the Australian economy that is not going to be hurt and harmed by that measure. We heard today the experience of tenants in Westfield shopping centres. The decision of Westfield to include a carbon tax clause in their latest rent agreements for shopkeepers is further proof that the Gillard Labor government's carbon tax is going to hit every Australian business. It will not just be paid by the big 500; we will all be paying and we will be paying for a long time. The Prime Minister spoke in the House today, and I do not know where she gets her information from. Shortly after, Zarraffa's Coffee House put out a press statement about recent lease negotiations. Remember that the Prime Minister is saying, 'This clause has been around for so long. What are people going on about?' What they are going on about is the punishment this carbon tax is going to inflict on small business. In this particular example Westfield is now introducing a carbon tax escalation clause in their leases to say that they will pass on carbon or greenhouse gas emission related charges and recover the same from the lessee. Zarraffa's are saying, 'We are really struggling right now.' They say the carbon tax adds insult to injury by not delivering on a long-term solution to carbon and indiscriminately weakening businesses across all industries. They point out that they cannot keep carrying increased costs and expect to survive into the future. They point to the carbon tax impact on transport, on power, on rents and so on. Now you see a major shopping centre owner putting it in as a reason to further escalate the lease costs that people face. That is the clause. The Leader of the Opposition showed the Prime Minister the clause. She retreated to the argument, 'It has been around forever; what are you going on about?' This ignores the very statement that someone with premises across a number of Westfield stores is engaged in current and recent lease negotiations where this has appeared for the first time.

But go further, even just accounting for what the impact is in the suburbs and regions across Australia. The Geelong Advertiser thought they would go and have a chat to some of the tenants in their Westfield shopping centre. Interestingly, at a time when the Prime Minister says this has been around for a long time, I will quote another Westfield tenant who said they recently signed a new lease to open another cafe in the complex and the person said it would not surprise him if Westfield included the clause in future contracts. So what he is talking about is a relatively fresh contract that was being entered into that did not have these clauses while other tenants are saying they are involved in negotiations right now where it is going to be pushed in. And the Prime Minister says, 'Look, it's nothing to worry about. It has been around for a long time.' It is very important for the Australian public to be able to separate fact from fallacy because we know this government's reputation on not giving us the full story. Remember 'There will be no carbon tax under the government I lead'? Small business remembers that.

The decision by Westfield to include this carbon tax clause in its latest rent agreements with shopkeepers shows that this carbon tax will impact on the prices of every Australian household, on every Australian business. This is something the retail sector is alert to. They are already doing it tough, yet now they have got further cost pressures on their very thin margins at the moment. In the case of the Geelong centre there was a proposition where the person was quoted as saying, 'There is no doubt that people cannot afford to pay any more rent. I would say about 25 per cent of businesses would be out of business in Westfield Geelong if this was included.' That was the Nextra newsagent, Wayne Crouch. Who do you believe: someone who is paying the rent, someone who is looking carefully at these lease agreements, or the glib, distracting non-answer we get from the Prime Minister saying, 'Don't worry about it, it has been around forever.' In everything you buy this will be embedded.

We have heard in recent days about the carbon tax impact in the transport sector. Just because it might not be in the government's mind a tax on what comes out of the tailpipe of cars does not mean there will not be a carbon tax impact on everything that leads to the fuel being combusted in the first place. When you talk to the Australian Convenience and Petroleum Marketing Association they say, 'Don't believe there will be no impact on us. The forecourt area lit up, the pumps running with their precision calibrations, all the supplies that are sold in the business, the refrigeration.' They are pointing to a direct impact of the carbon tax on petrol prices, not because it is on the pipe but because it is on everything that goes into making the fuel available in the first place. This is a carbon tax that will cost Australians 400 times the per capita impact of the EU scheme. That per capita impact is extraordinary.

What do we get from the government when these concerns are raised? We get a glib response from Greg Combet, the minister for carbon tax, who says a dry cleaner is not competing against dry cleaners in China. What a genius! Drivers cannot get their cars serviced in India. It would just be a whole lot more expensive. We already know for anyone who talks to a local mechanic that people are less inclined to do the routine maintenance on their vehicles. They are coming in when their car is in trouble. But there is a whole lot of demand impact already flowing through the system. You see it in the building industry, where the building industry is saying the proposed carbon tax will have a substantial adverse impact on the building and construction sector. You see how they describe the sector as one of low margins with long supply chains, how this tax will compound and impact on every step along the way. In manufacturing, the poor manufacturers—why have they deserved to get this negative tariff that is going to make an already difficult time for them extraordinarily challenging into the future?

It is not a surprise to see those Dun & Bradstreet figures. It is not surprise to have small businesses telling you about their concerns. It is a surprise when the new minister is not even aware of the crisis that small business is facing. But in an effort of unvarnished plagiarism what have we seen in the last three weeks? We have seen the Gillard government without an idea of its own lift three coalition policies in the last fortnight and claim them as their own. It is quite a remarkable thing to see, if you look at what is going on. I am sure the House will be quite interested. I am holding the coalition's policy document at the last election. Look at what the Prime Minister said when she was announcing the measure. You would have at least thought they would have come up with their own talking points rather than just lift out the concepts and ideas from the coalition.

We saw that also in the appointment of the new Minister for Small Business. And I would like to congratulate him on his appointment. So committed were the government to having this minister in cabinet that it has taken four reshuffles to get one there. They have bolted it onto homelessness and housing. I hope they are not seeing a connection between small business and homelessness as their mortgages are called in because of the failing of their businesses. I hope that is not the connection. But we still have not seen competition policy lifted. We still see that as a junior minister. At least it is up from a parliamentary secretary.

These are some of the real challenges that small business faces. If you are wondering why the Prime Minister announced 'the minister in cabinet' and the 'ombudsman', which they have called a commissioner—a bit of badge engineering—and 'our red-tape reduction', just go back to 8 July 2010, which is the date of the press release where we announced them. They picked up the coalition policy. As the government have no ideas of their own I urge the government, in the name of small business survival, to pick up the rest of our policies. Better still, why not cut out the middleman? We know there are costs and fat in the middleman. Why not just elect the coalition to implement it, because we are the ones genuinely committed to doing the right thing?

Let me look at another issue. Remember the solar rebate system for hot water, which just disappeared. Who is going to look after the small businesses that geared up with forward orders to account for the expected increase in demand and that are now left with all of this stock? I suppose they could put it in a warehouse with the fluff and foam they had from the Home Insulation Program. Why don't you look at what you are doing to independent contractors? Day after day you come in here and undermine independent contractors. They are a legitimate enterprise and they deserve to be supported.

Finally, if you really want a policy, pick up the coalition's one. Peter Strong was out there yesterday saying, 'It is a very good place to be at the moment for small business.' I would hate to tell you about the phone calls from people who were choking on their morning tea when they heard that. They are not sure what good place they are talking about. It might be a good place for people who are able to pick opportunities, but have a look at the business pressures being faced by small business. (Time expired)

Brendan O'Connor (Gorton, Australian Labor Party, Minister for Emergency Management) Share this | Link to this | Hansard source

I thank the honourable member for his contribution. Some of the comments go to the issue of the Liberal Party's concerns about small business. The unfortunate thing is that the policies he enunciated in relation to what the Liberal Party would have done if elected were clearly those things that they were not able to do or chose not to do when they were in government. For 11½ years the Howard government was in power and in that time submissions were made by the small business community to elevate the portfolio to cabinet. For the last six years of that period there was no small business minister in cabinet. There were also calls from the small business community to have a small business commissioner, something that was not acceded to or accepted by the Howard government.

In fact, the first government that introduced a small business commissioner was the Victorian Labor government, in 2004. It did so because it wanted to provide a voice for small business. It wanted to provide independent advice and the opportunity for representation to be made directly to the small business minister in the Victorian government. The Howard government and the member for Dunkley, when he was a member of that government, had an opportunity to ensure that this office was instituted, but nothing was done by the Howard government in relation to that office.

The creation of the small business commissioner is a very important announcement. It will provide small businesses across the country with the capacity to make representations direct to me and to receive very pertinent advice about their small businesses. I think it is an excellent decision and it is one that this government made. It is something that was not done by the Howard government.

I think it is important that the government elevate this portfolio to cabinet. I feel very honoured to be in that position. It is something the previous Howard government failed to do for the last six years of its term. That says something about the Liberal Party and their relationship with small business. They say they are the party of small business but, when it comes to reform and making decisions in the interests of that very important and vital sector, they have failed when in government. It is very important that I am at the cabinet table, not only advancing the interests of small business but taking into account any potential adverse effects that may arise from other decisions; therefore making sure that small business is being considered when governments are making such very important decisions.

The member for Dunkley spoke for 15 minutes and he did not talk about the need to immediately pass on some tax cuts to small business. It is quite extraordinary. I have never before seen the Liberal Party and a Liberal Party leader, Tony Abbott, oppose tax cuts for small business. He has categorically opposed the tax cuts for small business that will commence on 1 July. This is unheard of. This shows the disregard the opposition has for the small business community.

We are looking to reduce company tax from 30 per cent to 29 per cent for incorporated companies. We are looking to provide instant asset tax write-offs of up to $6,500 for literally millions of small businesses across the country. We are also looking to have an instant tax write-off for the first $5,000 of motor vehicle use for business. All of these measures are being opposed by the opposition.

This is quite extraordinary, because the Leader of the Opposition is on the record as saying that he supports tax cuts. On 29 March this year, when talking to Lyndal Curtis on ABC News 24 he said:

… in principle we strongly support company tax cuts … and we wanted to deliver this tax cut …

On 4 October 2011 he said:

… we don’t believe in new taxes. We believe in trying to get existing taxes down.

On 12 August 2011 the Leader of the Opposition said:

The best thing I can do for business is to cut its tax …

The Leader of the Opposition has been on the record time and time again saying he wants to support tax cuts, yet, when he is provided an opportunity to make sure we pass on tax relief to literally millions of small businesses in this country, the Leader of the Opposition stands up and says, 'I refuse to support that initiative.' It is absolutely outrageous and unprecedented action by the Liberal Party. We hear this time and time again from the Liberal Party, that they are the party of small business. They say they are the party of the forgotten people. They have forgotten the forgotten people by not supporting the tax cuts for small business. It is an absolute outrage and they should hang their heads in shame.

The other thing that we know when it comes to the Liberal Party is that they never let the truth get in the way of a good scare campaign. They have sought to scare the small business community, scare the people of this country, by making up falsehood after falsehood in relation to the carbon tax. The facts are these: this government will apply a tax to the 500 biggest polluters. We will ensure that people are provided support by way of tax cuts and by way of pension payments. There is no tax imposition to be placed on small business. The small and modest increases that will arise in prices we accept will flow on to the consumer—a consumer that will be provided with tax cuts and increases in pension payments.

Compare that approach with the approach of the opposition. Their view is to impose a $1,300 per annum tax increase on every household in this country. Who lives in those households? It is sole proprietors, independent contractors, microbusinesses and small businesses. They will all have to pay a $1,300 increase because the opposition kowtow to the Gina Rineharts and the Clive Palmers in this country and choose to provide tax relief for the largest businesses in this country and impose tax burdens on the smaller businesses in this country. That is a typical response from an opposition that is taking instructions from the super-rich in this country. I have never seen the like of it in the 10 years I have been in this place: the Liberal Party so nakedly taking instruction from the super-rich and denying and depriving small businesses in this country of the tax cuts that they deserve.

We still hope that the opposition—indeed, the member for Dunkley and others—will support the tax cuts for small business, but I doubt it. I cannot see it happening. This opposition leader and this opposition are so negative that I would not be surprised if they oppose their own policies. The fact is that the member for Dunkley put up a couple of issues—

Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Link to this | Hansard source

You're pinching them.

Brendan O'Connor (Gorton, Australian Labor Party, Minister for Emergency Management) Share this | Link to this | Hansard source

You might have come up with them in opposition, but you should have made the decisions in government. Of course, you chose not to and you have failed to properly relate to the small business community because in the end—

Mr Billson interjecting—

Yes, there is no doubt you did make small businesses tax collectors under the GST. That is the one thing they remember about you and the Liberal Party when in government. The small business community know they have a government now that is listening to them. Peter Strong, the executive officer of COSBOA, applauded the decision to institute the Small Business Commissioner. There is no doubt that they applauded that. Indeed, other employer bodies have done likewise, supporting the creation of this position. They are also supporting the tax cuts this government is soon to enact. They understand that small businesses in this country have challenges and it is for that reason that this government is providing some support. I think it is really important that the government play a role as an enabler to create the conditions in which businesses can thrive.

If you want some proof of the way the government respond to small business, you need only look at our decision when we were confronted by the global financial crisis. There is no better way to demonstrate the difference in approach between the government and the opposition than when it came to making decisions in relation to the challenges of the global financial crisis. We chose to invest in education and housing and to provide support—

Mr Baldwin interjecting—

Yes, we provided support for people who needed accommodation; yes, we provided support for students across the land who wanted 21st century infrastructure—and why shouldn't they want that? Who were the other beneficiaries of that very important decision? They were the thousands and thousands of small businesses across the country that worked on 27,000 projects—tradies, sole proprietors, independent contractors and small businesses in the construction and maintenance sector, and that flowed on to other sectors of the economy. If you went to an opening of a BER initiative—and I know that many on the other side, having voted against it, turned up to some of those events—if you listened to the small businesses that built those very important amenities for those schools and if you talked to the architects and builders, as you know, Madam Deputy Speaker Burke, they said: 'Without these decisions we would have gone to the wall. Without these decisions we literally would not be here today.' That decision by government—

Craig Emerson (Rankin, Australian Labor Party, Minister for Trade and Competitiveness) Share this | Link to this | Hansard source

Opposed by the opposition.

Brendan O'Connor (Gorton, Australian Labor Party, Minister for Emergency Management) Share this | Link to this | Hansard source

Yes, it was opposed by the opposition. That decision provided opportunities for thousands of small businesses. It meant that so many more people were employed. That was absolutely critical. It meant that we ensured that thousands of small businesses in every one of the members' electorates in this place survived and thrived. That is what happened as a result of those decisions. Conversely, the opposition chose to oppose those very important initiatives. In the end, their heart is not there to support small business. In the end, whatever their rhetoric, the reality is that their heart is not in this at all. Ultimately, if you have to choose between a tax cut for small business or tax relief for the largest and wealthiest companies in this country, which would you normally choose? This government will always choose support for small business and, clearly, the opposition will provide relief for the super-rich. That is the problem.

I have been in the role of the Minister for Small Business for a very short time. I am very proud to be the minister and I am very proud to have the portfolio elevated to cabinet. It is the first time since I have been in this place that there has been a cabinet minister representing small business. I am happy that within that time I have been able to announce the Office of the Small Business Commissioner. I am happy, indeed, to have been able to prosecute the argument as to why we need tax relief for small businesses. I will continue to prosecute that argument to ensure that we provide such relief.

I will be speaking to as many small businesses as I can as I go around the country. They are the engine room of this economy; there is no doubt. They employ just under five million Australians. They are absolutely vital to our economy. As I said earlier, the role of government is to create the conditions in which they can thrive. We did that when we confronted the global financial crisis. Indeed, we saved and ensured that certain companies continued in a very prosperous manner. We will continue to provide new opportunities for small business because if you create the right conditions then certainly those small businesses will prosper. Why is it so important? It is important for those businesses but it is also important because of the breadth and the proportion of Australian employees that are employed by those businesses.

We will continue to listen to small business. I will be travelling around the country talking to all of the areas of small business, and, literally, they are in every sector of our economy. I will be getting direct from them their concerns and challenges so that we can continue to respond. What I hope will happen between now and when the decision is to be made in the Senate is that the opposition has a change of heart. I hope the opposition thinks about this and puts the country first, puts small business first and supports the tax cuts and the tax relief that we want to provide.

All this week the Leader of the Opposition has tried all sorts of distractions to forget about the one issue that is clear in everyone's mind: we have a Liberal Party leader who is seeking to oppose tax cuts to small business. The only thing that they wanted to talk about today is one job for a former Liberal Treasurer. They did not want to talk about the jobs in the small business sector or about relief for small business. I say to those opposite: listen to the small business community, accept the tax cut, allow the tax cut and allow that for them because they need it. (Time expired)

Bob Baldwin (Paterson, Liberal Party, Shadow Minister for Tourism) Share this | Link to this | Hansard source

I rise today to speak to this MPI:

The adverse effects of Government policy on small businesses in Australia.

I would like to start by recognising and heralding all of those positive achievements that this government has made for small business! But I actually should start to address the real issue, and that is the issue of the negative policies that have impacted on small business. I have just heard from the Minister for Small Business how he is walking amongst small business, how he is listening. Minister, take the earmuffs off! If you took the earmuffs off you would hear what they were saying to you. You would hear of the record bankruptcies that are occurring. You would hear about the struggles that people are going through because of the lack of confidence driven by an incompetent Prime Minister with a Labor Party so focused on its internal fighting that it cannot be focused on the future of this nation. This government has undermined consumer confidence and it has undermined business confidence, and therefore we are seeing a reduction in investment because there is no confidence.

In fact, this is the government that said it would do a one for one: it would repeal the red tape and regulation that business goes through—in particular, the burden on small business. Since 2007 this government has introduced or amended 16,173 new regulations. It has repealed 79. I can understand why it does not understand small business, because it does not understand simple mathematics—

Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Link to this | Hansard source

Trust me! 205 to one!

Bob Baldwin (Paterson, Liberal Party, Shadow Minister for Tourism) Share this | Link to this | Hansard source

'205 to one', the shadow minister for small business says—because 16,173 does not equate to 79.

In relation to red tape, there was the industries for Australia review conducted by the member for Indi and the member for Groom. We actually did a separate one for the tourism industry. That identified a range of issues that business operators were facing. In fact, off the back of that our leader determined that we should have a special task force looking at addressing the issues of red tape. That is being headed up by Arthur Sinodinos, with a high-quality team.

How can you understand small business if you have never been there? How can you understand small business if you have never had skin in the game? I know the shadow minister, the member for Dunkley, has been in small business. He was a retailer. He has been through the tough times. He knows what it is like to have the mortgage over the family home, to worry about whether there are going to be people coming into the shop. What we have here on the other side are people who go from school to university to union to the parliament. They have not had a small business. They have never had their own money on the line; they have never had skin in the game. They have never had to address the issues of economic constraints and bad government policy. The only bad policy that they have within themselves is when they have a leadership battle and wonder whether the Left or the Right or the inside out are going to take the leadership.

When I look at the tourism industry, some 85 per cent of the players in the tourism industry are small to medium operators. They are part of the team that employs 500,000 people in the tourism industry. If I add hospitality into that, there are 500,000 people in the hospitality industry. They actually understand small business, because every morning they get up and face issues such as weather—and weather can be an impediment in the tourism industry; they face the issues of whether the dollar is going up or down; they face the issues of government confidence and whether people have disposable income in their pockets to spend on their business; and they face the issues of industrial relations reforms, which have driven a lot of businesses out of business. When I was with the member at Margaret River we were talking to restaurant and cafe owners that just shut now on Saturdays and Sundays because they cannot afford the rates, because this government has not understood what is required to keep businesses, and in particular small businesses, going. In parliament this week and in previous weeks they have been attacking Gina Rinehart and Clive Palmer. But the Minister for Small Business should have been standing up for them because a large sector of their spending is on employing or engaging or contracting small to medium enterprises. This government would rather take away from or crush those who do the employing.

When you have been only in a union and you have never been out there in the real workforce, you do not understand that without employers you do not have any employees. If you do not create an environment in which employers have the confidence to invest and grow their business, if the market conditions are not right, then guess what? You do not have employees. That is why we have seen a reduction in employment in this country. That is why we have seen a reduction in the number of businesses operating in this country.

When the Howard government left office, the Australian Bureau of Statistics estimated there were 5,061,000 people employed by the Australian small business sector. This was 51.3 per cent of the private sector workforce. By June 2009, when that mob were in government, the ABS reported small business job losses of more than 300,000 and a decline in the private sector workforce employed in small business to 48 per cent. Under a new ABS statistical methodology, introduced in June 2010, the small business employment level was estimated at 4,747,000, representing 47.2 per cent of the total private sector workforce. Since the change of government, there are 14,500 fewer employing small businesses. So when I see this minister stand up and boast how important it is to have a minister at cabinet level, I can understand that because, under their previous arrangement, we have seen 14,500 fewer small businesses.

We have seen record bankruptcies under this government. It is not hard to understand why when the banks are calling in loans because of the competition for finance when this government is borrowing $100 million a day, competing with the very businesses that need that money to fund their overdrafts and their investments in their business.

One of the key essences of being in business is developing a business plan. You put into it all the factors, you model all the conditions and you search out the best information so you understand that you can invest with confidence, go forward and stick to your plan. When this Prime Minister was asked what modelling had been done for the tourism industry in particular and on small business, the response was, 'None.' No modelling was done. She had spoken to a couple of people. She had a handle on it, she said. She has never been in small business; how could she have a handle on it? Without modelling, without understanding all of the conditions and factors, particularly when you bring in a great big new tax—the carbon tax—you cannot understand.

This incompetent government talks about the need for tax cuts. You do not have to be Einstein to work out that you do not need tax cuts if you do not impose new taxes on people. This government is giving on one hand while they are robbing with the other. This is the equivalent of putting a bandaid on your arm after you purposely slash your wrist. You would not need the bandaid if you did not slash your wrist. This government is so incompetent that it cannot even understand the flow of direction of business decision making. In fact, the only modelling that was done was by the TTF, and TTF came out and said that in the tourism industry there would be 6,400 job losses, predominantly in regional and rural Australia. It said the impact would be $731 million off the bottom line and the only beneficiary of a carbon tax would be outbound tourism.

We are suffering a tourism deficit in this country. Back in 2001, we posted a $3.6 billion tourism surplus in Australia. This year we are heading to an $8.7 billion deficit and in part that is because of the bad policy and bad direction of this government and, after 1 July, it will only get worse when this government imposes a carbon tax the likes of which never before seen.

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

Madam Deputy Speaker, I am so glad you have given me the call. I am going to be upfront. I love listening to the member for Dunkley. Whenever he brings these matters of public importance into the House I love it. He has that machine-gun delivery and all that energy. There he is, trying to paint a picture of horror, backing up his claims with playdough statistics, providing us with a promise that we will see a better future if we just follow what he tells us we need to do. If I close my eyes, I am not listening to parliament; I am listening to late night TV and he is Mr ShamWow. He is there, flogging his products to us with all that energy and gusto and I almost wait, Member for Dunkley, for you to offer us a free DVD of the performance. I will take it! I will take that any day.

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

Better than steak knives.

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

It is better than steak knives, indeed, as my colleague the member for Blair rightly points out. The member for Dunkley has directed all this energy and effort this week—it has been a supreme performance. Why have we had it? It is because opposition members are trying to mask the reality. They keep going on about how we are all from the union movement and how all we do is support the union movement. Do you know what? I have no problems supporting the union movement and union members because they are working people. I have no problem doing that. We, through our actions in this place, help working people every day.

Those opposite dress themselves up as the friends of small business when in reality they are the biggest betrayers of small business. They are the ones who made every single small business a tax collector when they imposed the GST. They loaded up small businesses with all that paperwork, forcing them to bring in MYOBs and to fill out business activity statements. They burdened them. These great friends of small business now worry that everything will come to an end when we introduce a price on carbon for the top 500 businesses. We introduced initiatives such as providing an asset tax write-off to improve the cash flow of small businesses around the country. Name one government that in one move was able to improve the cash flow of businesses to the tune of $6,500. It never happened under those opposite. We are providing it.

A government member: Per asset.

Per asset, indeed. When we give business tax cuts, what do these people on the other side, parading themselves as the great friends of small business, do? They oppose it. Big business and the corporate sector are trying to work out what is going on on that side of the fence when they will not provide a business tax cut and when they will not support what we are trying to do—effectively redistribute the huge wealth that has been generated on one side of the country to ensure that the two million businesses across this nation have a huge injection in cash flow. What do those opposite do? They oppose it. The member for Dunkley comes in here parading himself as some friend of small business.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

Mr ShamWow.

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

Mr ShamWow—there he is with this false pretence that he will help small business.

This week was a week of distractions. Yesterday the press gallery was in a state of confusion. I come from the great state of New South Wales. Mr O'Farrell, Premier of New South Wales, was deaf to the concerns about the drive-by shootings that have been happening in Western Sydney. I am happy to be corrected on this, but I thought there were about 60 drive-by shootings in the space of a year. We never saw anything, but all of a sudden yesterday the opposition discovered its concern for this issue.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

When the AFP is successful.

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

The AFP successfully intervened, Customs successfully intervened and those opposite were suddenly concerned about it. The press gallery was wondering where this all came from. The greatest smuggling act yesterday was these guys smuggling their embarrassment through distraction. What they tried to do yesterday was confect concern about something that we had been worried about for ages. The New South Wales government never did anything. The New South Wales government need to have something that can distract them from their problems with casinos in New South Wales. And you needed a distraction from the fact that you were not there to support business in this country because you announced you were putting your own interests above business interests. At least we stand up for the people that you always point out we represent: the union movement. You do not. The guys opposite fail to stand up for their own, the ones they claim they represent.

Look at the suite of policies that we have put in since 2007, all the things we have been doing. I have mentioned the asset tax write-off. I have mentioned the corporate tax cuts we are trying to make. We are providing a head start for small companies on the company tax rate, which you will deny through your actions in parliament. Businesses that operate as sole traders, partnerships and trusts will benefit from the next round of personal income tax cuts, which start in July this year. We have reduced quarterly pay-as-you-go income tax instalments for the 2011-12 income year for taxpayers using the GDP adjustment method, providing $700 million as a cash flow benefit to small business. Huge. Those are the types of things that we are doing. The New Enterprise Incentives Scheme is a program that helps eligible social security recipients to get into self-employment, to get into small business, giving them a start.

Look at the types of things that we on this side of the fence are doing to help small business but that are opposed by those opposite every single step of the way. They are not interested in jobs. Today demonstrated it. They were more interested in providing a job for someone they did not want to give a job to themselves. They were concerned that the former Treasurer and member for Higgins was not going to get the plum job at the Future Fund. Yet they would not even put him in as leader of their own party. That is what they are concerned about in this place. They are not concerned about the jobs created by small businesses. They are not concerned about the policies that we are putting forward that support small business. It was remarkable, I have to say, to hear the Leader of the Opposition talk about Peter Costello, the former member for Higgins. He has now been lionised by those opposite after he was demonised when he was in the parliament.

We had the situation where the Leader of the Opposition, the member for Warringah, was saying that the member for Higgins as Treasurer alone was responsible for two million jobs being created. Those opposite were in power for 11 years and they created two million jobs, but we have nearly cracked one million in one parliamentary term. What was the former member for Higgins doing in what we are told were great times for the economy? Those opposite were not interested in creating jobs. They were not responsible for creating jobs. They made life hard for working people trying to draw a wage through what they did with Work Choices. On top of that they put huge burdens on small business.

Where were they when small businesses were asking for help on trade practices reform? Missing in action. When small businesses were concerned about predatory pricing that was squeezing them out of business or when small businesses were concerned about creeping acquisitions, I remember the member for Higgins resisting the calls for trade practices reform, sitting on reports that had been done, reports that called for that reform to occur to help small business, which did not want to be muscled out by big business. I congratulate those opposite. They have got form. They are always helping out those big interests in the economy: Clive Palmer, our national treasure, Gina Rinehart—

Opposition members interjecting—

I know you love Gina. I am waiting for the T-shirts to sprout on the other side of the chamber. Back then, they were going slow on competition reform, slowing things down so that small businesses could not get ahead. I never heard you, Member for Dunkley, ever raise that. The other thing is that I have never seen the member for Dunkley be so concerned about the fact that those opposite, your side of politics, would deny those people a tax cut. You are an absolute disgrace to small business. (Time expired)

Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

I am here to talk on the MPI on the adverse effects of the government on small business. I come from a small business background. Overall, the effect of the government is negative. There is a lot of uncertainty out there; there is a lack of direction from this government and this is confusing small business no end. There is absolutely no confidence out there in the field. People are preferring to put their money in the bank instead of investing in their business. Their business is industry for Australia and jobs for Australians.

Don Randall (Canning, Liberal Party, Shadow Parliamentary Secretary for Local Government) Share this | Link to this | Hansard source

That's right.

Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

Under the Howard government, workers—my friends, your friends—had jobs. What is more, they had took a 20 per cent increase in pay versus the CPI. Under this government, since 2007—

Opposition members interjecting—

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

The member for Flynn is not being assisted by his colleagues. The member for Flynn has the call.

Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

I think they are doing a great job. You cannot talk about small business without talking about big business, because a lot of small business works for big business. That is what you must consider. The week after the carbon tax was announced in this House, Rio Tinto, a big multinational company, put the Boyne smelter at Boyne Island on the market. It also put its 42 per cent share of the Gladstone power house on the market.

This MPI is about small business, but I am saying that Rio Tinto employed 4,000 people in Gladstone and a lot of subcontractors, who are small—

Luke Hartsuyker (Cowper, National Party, Deputy Manager of Opposition Business in the House) Share this | Link to this | Hansard source

The government will turn Rio Tinto into a small business!

Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

That is right.

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

One person has the call: the member for Flynn.

Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

They talk about Clive Palmer; Clive Palmer is the man who saved a thousand jobs in Townsville at the zinc refinery. How many people does Gina Rinehart employ?

The wind-back on the solar hot water scheme: does anybody in the government realise what that meant to those businesses that had geared up to look after that industry? It just flattened them—bang! Finished. Those opposite rave on about the BER. I could tell you something about the BER. There were four examples in my area where small business could have done the job of building the BER—

Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Link to this | Hansard source

Didn't get a look in.

Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

They did not get a look in. Do you know what? Their price was up to 50 per cent less.

Luke Hartsuyker (Cowper, National Party, Deputy Manager of Opposition Business in the House) Share this | Link to this | Hansard source

How much?

Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

$900,000 from—

Mike Kelly (Eden-Monaro, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

It does sound like ShamWow.

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

No, it's true.

Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

It is true. I have got the evidence. Actually, I have given the evidence to the Senate. Reed Constructions was a favoured son of this government. Where is it now? Where are the contractors—the subbies—going to get their money from? There is nearly $100 million owed to subbies. Where has the money gone? The overall cost of the BER was about $4,300 per square metre to build libraries and that type of thing. The price to build a four-bedroom home with a double carport is about $1,200 per square metre. Where did that money go? How come Reed Constructions is in administration? I do not know.

Even the Road Safety Remuneration Bill 2011, which was discussed today in the House, is more red tape and more costs to small business. What small business hates is getting more bits of paper under their nose and being told: 'This is more regulation. You will do this; you will do that.' We have a taxation system. If you ring the tax office to get clarity on a problem you might have, depending who you ring, you might get five different answers. If you ring five different times you get five different answers.

Mr Bruce Scott interjecting—

Unbelievable! What was that?

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

Are they answered in Australia?

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

The member for Flynn has the call, and he is meant to be giving the speech.

Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

Would you control the House, please!

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

I might save us all and sit you down, if you are not careful!

Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

The biggest problem affecting small business is productivity. Our productivity is the worst in the world.

Dr Mike Kelly interjecting—

You laugh, Member for Eden-Monaro, you clown: it is the worst in the world.

Peter Slipper (Speaker) Share this | Link to this | Hansard source

The honourable member will withdraw the use of that term.

Don Randall (Canning, Liberal Party, Shadow Parliamentary Secretary for Local Government) Share this | Link to this | Hansard source

Is 'clown' unparliamentary?

Peter Slipper (Speaker) Share this | Link to this | Hansard source

It is all about the context.

Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

I will withdraw, Mr Speaker. Small business is faced with a renewable energy tax. That was passed by both sides of the House, but it will have a big impact on business. It will add at least 10 per cent to costs, and that is before the carbon tax. The carbon tax has been well documented and talked about. Not only will it affect the 500 biggest polluters in Australia, those awful big companies that we used to encourage to come to Australia and set up their businesses, it will affect every man, woman and child in Australia. Make no mistake about that. It is not just going to affect the 500. IR laws are inflexible. That is why you are flat out getting a cup of coffee on a Saturday or a Sunday. From five o'clock on a Friday afternoon until eight o'clock Monday morning, you will pay dearly if you want a cup of coffee anywhere in Australia. We have a tourism industry. And guess what? Tourism does not really start until after five o'clock on any day of the week. Yet the laws are that stringent and that tough; there is no bending them.

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

There are penalties everywhere.

Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

Yes, there are penalties everywhere. (Time expired)

Peter Slipper (Speaker) Share this | Link to this | Hansard source

Order! Regrettable though it is, the time allotted for this discussion has now expired.