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Thursday, 28 August 1997
Page: 7356


Mr MARTIN(12.39 p.m.) —It is a great pleasure to speak in the Main Committee this afternoon on this particular report of the Standing Committee on Industry, Science and Technology. I think most members of this House would know that I have always been a great supporter of the role that parliamentary committees can play in advancing ideas to government. In this particular case, I think this is not only a timely report but also one which this government needs to respond to quickly.

Again, I put on public record that the Australian Labor Party will give swift passage through both the House of Representatives and the Senate to any of the recommendations requiring legislation arising out of the committee's report. I have said that publicly. I have put that on the record in a number of different forums around this country in the last several months as we have talked to people in small business but I think it is the first opportunity that I have had to record it here in the parliament. I think it is important that that be said.

I do not think anybody who has participated in discussions with small businesses, particularly small businesses and franchisees in shopping centres, could be left untouched by some of the stories that these people tell about the complete and disproportionate amount of market power working against the interests of small business.

I have travelled around in my capacity as the shadow minister for small business in the last two months—in the break—and spoken to people in shopping centres in Rockhampton, Wollongong, Melbourne, Newcastle and the Gold Coast. The stories I was told were mirror images of the stories which colleagues who sat on this committee heard in evidence which they received. They were the stories of small business people, micro businesses, and mums and dads operations: in Australia some 50 per cent of businesses are operations run by one or two people, often family members, that do not employ anybody else.

They told stories about the way in which market power was being used by shopping centre management and by owners of shopping centres to disadvantage them, and stories about being forced to relocate within shopping centres to areas where less passing traffic was going to mean a slashing of profitability for that small business and, in many cases, was going to cause it to go to the wall. They told stories about ways in which new tenancy agreements were struck and the way in which the small business person was disadvantaged in those negotiations with a virtual `take it or leave it, and if you do not like it then you are out the door' type of arrangement. When you talk to franchisees of the common franchises that we see in shopping centres about some of the master franchisors they tell stories about the way some of those franchisors—not all of them, but some of them—deal with people. They tell stories about the up-front fees and the increases in outgoings which small businesses in shopping centres have to put up with.

In one shopping centre I went to in Melbourne, the total cost of outgoings—the moneys that shopping centre tenants pay for things like joint advertising, cleaning, security and so on—was $600,000 in one year. The next year that was put up to $1.2 million. There was no consultation with the tenants. The centre management simply said, `Here's your new bill and you are going to have to learn to live with it. Of course, you will be levied an increased fee for the privilege of having your premises cleaned, guarded and advertised in joint publications.' These are the sorts of issues which are out there in the ether. These are the sorts of problems facing small business.

Much has been said about small business in this country over the last 12 to 18 months and perhaps longer. There are two things I want to say. Firstly, we on our side of the parliament would be the first to concede that when in government we probably did not move as quickly as we should have to protect small businesses from unconscionable conduct, predatory pricing and some of the other issues which have been outlined in this particular committee report. I accept that, and we are moving to try to redress that—albeit, unfortunately, from opposition.

Secondly, I think it is fair to say that in the election in March last year there was a clear expectation from small businesses that if they voted to put the coalition into government they would have friends in court and the coalition would move to support small business. Regrettably, they are telling me that that is not happening. They are telling me that some of the things the Treasurer (Mr Costello) or the Minister for Workplace Relations and Small Business (Mr Reith) are talking about at the moment, like capital gains tax, rollover provisions for retirement, unfair dismissal provisions and so on, whilst they are important to some small businesses, are not the key issues. What small businesses want is a return to profitability. What they want is business confidence. What they want is more people coming through the front door.

But they also want protection. They want protection from unconscionable trade practice. They want protection from some of the activities that certain shopping centre managers embrace as part of their running of shopping centres. In fact, what small businesses are saying is that they want to find a balance. They want to redress the imbalance that presently exists between the small shops and the people that own the shopping centres and manage the shopping centres. They want to make sure that that balance is redressed, with equality in terms of negotiating power at least.

This report makes specific recommendations about that. As I have said, this report goes to issues like franchising and retail tenancy legislation. And, importantly, it says that in both of those instances, we should have legislation through changes to the Trade Practices Act underpinning codes of conduct. We could not agree more. Giving small businesses the opportunity to take on landlords who are unscrupulous, in a fair, reasonable and equal arrangement, is critical to the improvement of small business and its operation.

I think that it needs to be said, also, that access to justice and the cost of access to justice are disproportionate—and examples are given in this particular report. It is very easy for the Woolworths and the other major shopping centre operators in this country to throw a ton of money and a truckload of lawyers at a small business person and bankrupt that person, causing marriage breakdowns and all sorts of difficulties for those people, and not think anything of it.

On the other hand, if there were access to justice through tenancy tribunals, an equalisation of that power relationship which presently is so unequal would occur. Quite obviously then small business would feel much better off and would, in fact, be much better off. They are the recommendations contained in this report.

Much has been said over the past several months about small business. In fact, it cost the former minister for small business, the member for Forrest (Mr Prosser), his position in this government, and we have a new minister now. This minister has said that he is going around talking to people. We all know that the government's response to this report was due last Tuesday. We have said to the minister that if he wants another couple of weeks because he is only new to the job, that is fine. He said that he wanted to talk to people to get an overview of what was going on.

But while he is doing all that, of course, his bureaucracy is out there drafting the response that the government will bring down to this report. I know that there are members of the government parties—those members, particularly, who were part of the committee inquiry—that will be doing their utmost to ensure that their government upholds every recommendation to the last word to ensure that small businesses do get a fair go. As I said, on 2 March last year there was an overwhelming depth of support for this government by small business. They expected to get something. They expected to see opportunities for small business to be improved and, as a consequence of this report now being released—it being known to so many in the small business community—they can only hope that the government will be true to its word.

Not unexpectedly, the other side of the equation—best described, I guess, as the landlords—is fighting back. The landlords have asked Access Economics to produce a contrary view to the parliamentary committee report. This contrary review was put out a couple of weeks ago and it was called Tipping the balance. We all know in which direction that balance was proposed to be tipped when this analysis was done by Access Economics and came out on behalf of the Property Council of Australia. It was tipping it back towards the landlords.

Quite frankly, the criticism that this document levels at a parliamentary committee—almost claiming that a parliamentary committee of the House of Representatives was unprofessional in its approach to an issue—is laughable. I know that someone like you, Mr Deputy Speaker Nehl, who is as committed as I am to the way in which this parliament is seen as being so important to the nation's future and, to the fact that our committee system can make, and has made in the past, a tremendous contribution to changing government laws, would be just as offended as I am by some of the comments that are contained in here.

This creates an enormous problem for my good friend the Minister for Workplace Relations and Small Business. On one hand, he has a parliamentary committee and his own colleagues saying unanimously that small business has got to be looked after. They are saying, `Look after the small business community that voted for us. They deserve an equal chance.'  On the other hand, you have got a report from the Property Council of Australia which says, `Don't worry about them; most of them are whingers anyway. Free competition is what it is all about. After all, Minister, the Property Council of Australia translates as landlords, and that translates as plenty of good donations around election time.' That is the balance that this minister is going to have to address.

Much has been suggested about issues arising in this committee report. I am pleased to say that a number of media commentators have picked up on it and have reproduced some of the horrendous stories that were contained within it. But at the end of the day, it is simple for this government. They have a unanimous government report. They have the support of the opposition—and the Democrats, I might say—for enacting the legislative changes recommended in here and the other issues which are required and that will help small business. There is a win-win situation.

This is one of the truly great moments in Australian politics, where all sides of the political fence are quite prepared to say to the small business community, `We will help you. Here is the document that recommends how that will be done and here is the legislation going to pass through both houses of parliament with the support of every major political party.' I think that it is probably a bit of a rarity in this place to get everybody agreeing with each other.

On the committee, I know my good friend the member for Scullin (Mr Jenkins), who was a very active member in this and played a very real role, and also my colleague the former minister for small business and the member for Rankin (Mr Beddall), had a lot of time and effort which they were prepared to expend with government members in arriving at that joint position on fair trading.

If one quote illustrates the sorts of problems that small businesses have encountered as a result of this inequality in market power, it is the one that appears on page 4 of this report. I would like to have it read into Hansard. It is from an unspecified retailer because quite clearly she did not want to be identified. It reads:

I once had a thriving business in an industry few could match my enthusiasm for . . . [What the retail leases tribunal could not consider is the devastating effect the past five traumatic years have had on me and my family which not even our once rock solid 27 year marriage could survive. We were once confident, positive thinking go-getters but now we're broke and dispirited relics of our former selves with several stress related health problems, not the least being acute depression, insomnia, nervous tension and obesity. I went through premature menopause and my once cheerful, workaholic, loving partner is now an angry, aggressive alcoholic. Our children suffer too, helplessly watching both their parents fall to pieces before their eyes and their quality of life diminish. At 50 years of age, we've been left with a massive business debt, which we have insufficient earning power to repay, and . . . we now face the real prospect of being homeless as well.

The chains have been allowed to gobble us up and the landlord is allowed to trample us down. Our pleas to politicians fall on deaf ears and the legal system treats us with contempt. The end result is the tragedies exposed almost daily in the national news. Why must it be so? We too are entitled to our place in the sun. [The Fair Trading inquiry] has within its power to recommend that justice is done and if I believed in God anymore, I'd pray that you will ensure it is.

That is from the heart of a retailer who has suffered grievously because of past policies of all governments. Here, with this report, is an opportunity to redress those sorts of problems. The Labor Party, for its part, will help in that process.

I have travelled extensively. I have spoken at retail rallies involving 500 people in Newcastle, 100 on the Gold Coast and 1,000 in Melbourne. They have told me what they want. Yet the minister for workplace relations came into this parliament yesterday and said what people want is capital gains tax rollover relief so they can pocket $500,000 on retirement. The only small businesses that could do that would be people that owned a McDonald's franchise or something similar, not the bulk of small businesses in this country. Respond to this committee inquiry report and justice will be done. (Time expired)


Mr DEPUTY SPEAKER (Mr Nehl) —Before I call the next speaker, I inform the committee that the children in the public galleries are from the Nambucca Heads Christian Community School, the jewel of the electorate of Cowper.