Wednesday, 4 May 2016
Questions without Notice
My question is to the Prime Minister. Why is the Prime Minister cutting $4,463 every year from a single working mum with two kids in high school on $87,000 a year while he is giving someone earning $1 million a year a tax cut of nearly $17,000?
My question is to the Minister for Small Business and Assistant Treasurer. Will the minister update the House on the additional support our government will provide to Australia's hardworking small businesses? What will these measures mean to the small business sector in my seat of Herbert and the city of Townsville? How will these measures create jobs and growth?
Ms Plibersek interjecting—
I would very much like to thank the member for Herbert for this question. As someone who worked very hard in a small business before coming to this very place, the member for Herbert very much understands small business He understands that this Turnbull government is backing hardworking small businessmen and women and encouraging workforce participation and business investment to improve growth and to create jobs. We are expanding tax incentives and tax cuts to even more small businesses so that they can reinvest in their businesses and they can create local jobs.
More than three million small businesses will benefit from the government's cuts to tax. From 1 July 2016 the company tax will be reduced to 27.5 per cent for the 870,000 small businesses with a turnover of less than $10 million. Unincorporated small businesses will also benefit from increased tax discounts of eight per cent from 1 July 2016 for the more than 2.2 million unincorporated small businesses with a turnover of less than $5 million. We are also expanding access to a range of small business tax concessions for businesses with a turnover of less than $10 million. This includes access to those $20,000 instant asset write-offs, which mean that business owners can invest in their business.
How will this help the electorate of Herbert? Under the government's new definition of small business, there are more than 13,000 small businesses in the electorate of Herbert with a turnover of less than $10 million. Take, for example, the Great Northern Laundry. This is one example of a fantastic small business in his electorate. It employs more than 50 people in the local community; it has a turnover of above $2 million. Currently, it does not qualify for the government's small business tax cuts or concessions, but under the government's changes the Great Northern Laundry will receive a tax cut of 2.5 per cent and will be able to take advantage of the instant asset write-off. Are there any risks to this? Well, yes, there are, and they are sitting opposite. Labor has said that it will tax small- and medium-sized businesses more. Compared with our economic plan, they will force more than 90,000 small businesses, employing more than 2.2 million Australians to pay more tax. As the Leader of the Opposition said in his interview today on the ABC: 'It's a matter of priorities.' We on this side of the House prioritise small business; we back small business. Those opposite stand in the way of small business and are a handbrake to their expansion.
My question is to the Treasurer. Can the Treasurer confirm that he said last year to Ray Hadley:
Well, what we want to make sure of with superannuation is that we need to respect the fact that people have been saving under particular rules over a long period of time that there is nothing that punishes or penalises them retrospectively on any of these things. I mean that is one of those iron clad rules about when you look at these systems.
If that is the Treasurer's ironclad rule, why did he do the exact opposite last night?
I thank the member for the question, because I did no such thing, Mr Speaker. I did no such thing. You might want to listen carefully. What the government did last night on superannuation is that we did not change the taxation status of superannuation funds in the retirement phase. We did not change it; they remain tax-free. If you have money in a retirement phase account, you do not pay any tax on the earnings in that account. There is only one side of politics that is doing that, and that is those opposite.
Those opposite will change the rules if they are elected; if you have money in a retirement phase account, you will pay tax on the earnings. That is what their policy is. We did not do that policy, because it is not a good policy and it does not accord with the principles that we follow on this side of the House. Last night we ensured that the generous tax concessions for those on very high incomes and very high levels of assets those concessions have been taken away for those at that level—$6 billion will be raised over four years from just the top four per cent of those in those categories. We have taken $3 billion of that and we have invested back into this superannuation system and we have invested it back in ways to ensure that, if you work up to the age of 75, you can still make contributions to your superannuation. Particularly for those who are largely self-employed, we have removed all the restrictions on them being able to make tax deductions for the contributions they make to their superannuation. That is really important news for tradies.
We have also lifted the threshold for people in couples so that the primary income earner now will have greater opportunity to invest in the superannuation accounts of the secondary income earner. We have re-established the support for those on low incomes through the Low Income Superannuation Tax Offset, which will make 25 per cent of those low income earners with accounts better off.
So with superannuation we have not gone after a tax grab like those opposite. All that those opposite see when they see an Australian working or saving or investing is an opportunity to tax them. On this side of the House, we see an opportunity to encourage them. Through last night's budget we want to encourage people, particularly those in small business, to go out and employ young people. There are 120,000 placements for young people to get into real jobs with real employers, based on real experience.
It is a pleasure to take a question from the member for Macarthur, continuing the excellent work of his predecessor, Pat Farmer, in fabulous Western Sydney. I am delighted to report to the House that spending in the Health portfolio has increased in this budget by 4.1 per cent. It is now $89.5 billion. Some of the highlights of this budget are our fast-tracking of access to medicines and medical devices, making Australia a much more attractive place to invest in and innovate—
Ms Plibersek interjecting—
The member for Sydney has, helpfully, reminded me of our first ever Commonwealth public dental scheme—
Ms Plibersek interjecting—
We have an important women's health initiative. We are building infrastructure to train new doctors in the bush, because access to GPs is vital for rural and regional Australians. We are creating a national registry for breast and cardiac devices. They are just some of the highlights.
But, against that background, I remind the House of our ongoing solid policy development in health, all of it designed with patients at the centre. I have a saying that the further away the dollar falls from the patient the less effective it is, and that is what our policy does, whether it be our $2.9 billion funding for hospitals—received with great pleasure by every single state health minister—building in reform around safety, quality and reduced avoidable hospital admissions; the landmark Medical Research Future Fund; our mental health reforms that really stop people falling through the cracks; access to medicines and new breakthrough drugs; or access to medicinal cannabis and the important reforms to come for the supply and cultivation of something that will help patients in distress.
Against that background, we are in the dying days of the 44th Parliament, and we do not have a single health policy from Labor—not a single health policy. We have not heard one. We started last year with a big year of new ideas—
Mr Dreyfus interjecting—
we had not one single idea in health. And I am still waiting. The Leader of the Opposition said today, 'We've got a plan to properly fund our hospital system,' but the only plan that we have ever heard of was reported in TheCourier-Mail recently, when we were told that Bill Shorten's team had been meeting with state Labor treasurers to determine what health funding they could live with. In other words, Labor were going around working out the sort of deal that could get them off the hook for their $57 billion unfunded spending promise that they have rolled out time after time. Absolutely not one single policy— (Time expired)
Ms Plibersek interjecting—
My question is to the Prime Minister. Why is the Prime Minister making Australian families wait two more years for any help with their childcare fees, while he gives someone on $1 million nearly $17,000 every year?
Government members interjecting—
The honourable member's question—and, I believe it is likely, the member for Sydney's question—proceeded on the premise, the false premise, that there is a change to the deficit levy in the budget. There is no change to the deficit levy in the budget at all. The deficit levy was introduced two years ago, to run for three years; it adds two per cent to the top marginal rate; and it expires on 30 June next year. It was introduced for three years only, and apparently the Labor Party want to make it permanent. So they want to increase the top marginal rate, permanently, by two per cent.
Mr Bowen interjecting—
I would simply refer honourable members to the remarks of the shadow Treasurer when it was proposed. He said:
… we don't believe that the answer of increasing the marginal tax rate is an innovative one or it's good policy when you consider that we have to compete for labour around the world.
I also refer members to the remarks by the Leader of the Opposition back in 2005, when he said:
It should be remembered that reducing the top marginal rate is part of the solution …
Apparently increasing it is now part of the solution! Of course, there are the immortal words of the shadow Assistant Treasurer, who observed: 'Humans'—as opposed to other species, no doubt—
The Prime Minister will resume his seat.
Honourable members interjecting—
The Prime Minister will resume his seat. It is difficult for the Prime Minster to hear me when people are interjecting. The member for Griffith, on a point of order, and she will state the point of order.
thank you for owning up—will not interject. I say to the member for McMahon: I have asked you to cease interjecting. Earlier today, I agreed to your matter of public importance, and I think you would like it to go ahead. And the member for Sydney, I am presuming, wants to be here to hear it.
As I said, the shadow Assistant Treasurer observed:
Humans typically … work harder when the tax rate falls—
and that is a very good insight, for which we thank him! Another interesting insight on the matter of taxation and motivation came from the member for McMahon back in 2005, when he said in this place:
We all like a tax cut. Everybody likes a tax cut—
not anymore, apparently!—
People at the upper end of the income scale like a tax cut, and they deserve a tax cut. Under Labor they would get one.
Well, under this Labor Party, what they would get is a tax increase.
A number of these questions, full of assumptions and numbers, have been based on a completely false premise—that the budget deals with the deficit levy. It does not. The deficit levy was introduced for three years. The Labor Party criticised it trenchantly and then finally voted for it. They voted for it to be a three-year levy. If they want to propose tomorrow night that the top marginal rate be increased by two per cent, then they are free to do so, but that would be a consequence of their policy, not ours. It would be a change in their policy, to increase income tax.
My question is to the Minister for Small Business and Assistant Treasurer. Will the minister update the House on the government's plans to improve the superannuation balances of Australian women? How will these important reforms help Australian women to be more economically secure?
Another great question from the very hardworking member for Robertson. The hardworking member for Robertson knows that this government, of course, has a plan to have a very strong economic future for all Australians, but particularly for women. One of the features of our budget and of our government is to make sure that we change the superannuation system so that women can save more for their retirement. We are providing flexibility and more incentives for those women to save for their retirement because we know that women are more likely to experience interrupted work patterns that can include: taking time out to care for children or to care for loved ones. That contributes to women having lower lifetime earnings and, therefore, lower superannuation balances.
We know that, on average, women retire with around 35 per cent less superannuation and that they outlive men. But, knowing these facts, what has the Turnbull government decided to do about it? We have acted to allow women to make catch-up payments for their superannuation when they return to the workforce. They will be able to use the unused parts of their concessional cap on a rolling five-year basis if they have balances of less than $500,000 in their retirement savings. For the member for Robertson, this will actually help her constituent, Amy—who takes a year away from work to care for her baby and earns no income that year—so that she can then contribute up to $50,000 concessionally the following year when she returns to work. We are also extending the current spouse tax offset to help families to support each other to further accumulate superannuation savings. If her constituent, Amy, goes back to work part time and she earns less than $37,000, then her partner, Steve, is able to now put money into her superannuation account and get a tax offset of up to $540.
We are also supporting low-income earners, who are more likely to be women, to accumulate superannuation through the low-income superannuation tax offset. This replaces the low-income superannuation contribution, but it deals with it through the taxation system, not the payment system, as those opposite would like, and it helps around two million Australian women. Women should not be economically disadvantaged if they have interrupted work patterns. This government is determined to make sure they are not and it is determined to ensure that women can save for their retirement and can have a strong retirement income. That is what we stand for on this side of the House.