Mr LLOYD (4:00 PM) —It is obvious that the opposition certainly does not have any policies when they have to resort to Groucho Marx to provide their policies. The Labor Party does not understand small business. This MPI shows just how little they understand about small business and how it works. They have no policies, they have no directions, so the only thing they can resort to is scare tactics—scare the elderly, scare the vulnerable and don't worry about the facts and don't worry about what we as a government are achieving for Australia: the benefits to our economy, the benefits to small business, and the benefits from the decrease in unemployment.

Who sets the prices now? When we walk around the supermarket or go to the general store, who sets the prices now? There is no big watchdog there. No-one says that that particular item will be X dollars and cents. I know, because I ran a general store and we used to look at our costs—what it cost to run that business, what it cost to get that product onto the shelf to provide for the customers. When we worked out what it cost for us to provide that good, we then set a price which we felt was competitive and fair to the consumers in our community. That is what happens now; that is what will happen after the GST is introduced. Businesses will look at the cost to them—what it costs to get that particular good onto the shelf.

In many cases, those goods will be cheaper. The costs of transport, fuel, vehicles and running businesses will be less, so to get that product onto the shelf will cost less; so, in many cases, the cost to the consumer will be less. That is exactly what will happen in all industries because it is a competitive economy in which we live. If you go into one particular store and find a product that is far dearer than at another particular store, you will soon realise that that shop is not being competitive and you will go to the cheapest supplier of that good or service.

I have an example of how business operates now and how it will operate after the GST is introduced. This will apply to all businesses, including funeral directors and other businesses. I have here a letter which was written to me by a constituent during the last election campaign. That was a highly emotive election campaign which was filled with mistruths and outrageous scare campaigns from the Labor opposition which were not based on facts. This constituent, who is an electrical contractor, was so concerned that he wrote me this letter. He said:

Dear Jim

Just a short note regarding an ad being run currently on television by Kim Beazley, in short it refers in a derogatory tone that "even a visit by an electrician to repair your stove will attract a 10% GST", you may find the example below interesting, i.e. to call and replace a common electric hot plate in a domestic stove, this would be typical invoice.

He then shows that, under the current system, to supply one Stokes catalogue element the cost would be so much, the mark-up would be 25 per cent, the sales tax 22 per cent, and the minimum labour charge would be $45. The subtotal would be $134.47. So the total before GST was $134.47.

He then shows the costs with a GST. He sets out the price in the catalogue for the part, which would be $60.87—the same as before. The mark-up would be the same, at $15.21. There would be no sales tax at all. There would be the same minimum labour charge of $45. That would be a subtotal of $121.08. Add on the 10 per cent GST of $12.11 and the total would be $133.19. That means that it would have been over $1 cheaper with a GST to have the electrician service that part on your stove. This is the point we are trying to make. This is the point that we cannot seem to get through to the Labor Party because they see it as some cheap electoral advantage to run scare campaigns.

Opposition member interjecting—

Mr LLOYD —The member opposite interjects and says that we are talking about funeral directors. The example would be exactly the same. The funeral director has costs now that will be cheaper with a GST. The fuel costs, the vehicle costs, the costs of running his business will be cheaper. That will be reflected in the final cost of the product.

Protections will be put in place against people who may try to rip off the community with the GST. The government is aware that most small businesses will do the right thing, but there are always people out there in the community—luckily, a minority—who will try to profit from change. With the transition to a new tax system, there is at the moment legitimate community concern regarding the possibility of consumer exploitation and excessive profit taking.

With the measures designed to counter this, the government will legislate to provide the Australian Competition and Consumer Commission—the ACCC—with special transitional powers to formally monitor retail prices. They have allocated $27 million in the budget to provide the ACCC with the resources to monitor those prices. One of the most important things to recognise is the fact that we live in a competitive economy. Our economy is based on free trade and competition. We are all consumers. We all go into the marketplace and buy goods and services.

The Australian community looks around for the best prices. We may get an electrician who says, `Fine, I can get away with adding 10 per cent GST on to my price. I can get another 10 per cent and put it in my pocket.' But there will be another 20 electricians in my community who will say, `I can now become more competitive. I can actually drop my rates and get more business because I am competitive.' That is what the whole economy is all about. But the Labor Party—full of union officials—do not understand what the economy is all about. If we drop the price of running businesses, we can make the cost of doing business cheaper and we can provide more competition for communities.

This is the last major reform that this government has to put in place to continue the reforms of the Australian economy. This economy has, I believe, been described as the miracle economy of the Asia-Pacific region. It is the fastest growing economy anywhere in the world. The Labor Party do not want to know this. They do not have policies to put forward. They just run with scare campaigns.

I get out in my electorate and I talk to the young people and I say, `Grab this opportunity with both hands and make the most of it.' We, as a government, have created opportunities for millions of young people in Australia that they have not seen. They suffered through 13 years of Labor, who dragged this country down. We have created the lowest interest rates in about 30 years. We have virtually no inflation and we have an economy growing at five per cent. We have small businesses where optimism is at the highest levels that we have seen in a generation.

All the Labor Party want to do is try to hold this country back. They will not allow us to put our reforms in place; they will not allow us to get on with the job of making this country strong. That is what being in parliament is all about or what it should be all about. Instead of being negative and trying to block sensible reforms that the government is putting in place, they should be joining with us and supporting these reforms. A typical example is the unfair dismissal regulations that we put in place which the Senate now wants to reject. That is going to cost up to 30,000 jobs. The Labor Party want to block youth wages. They want to destroy the hopes of young people.

The Labor Party do not have any direction, they do not have any policies, so they have to resort to the disgraceful scare tactics of scaring the old and the vulnerable in the community by talking about the increased cost of funerals. Why do they not base their argument on fact and not on scare campaigns and lack of policies? The government is getting on with the job of making this country strong. The tax reform package is the last great reform that the government has to put in place to keep our economy moving forward. (Time expired)

Mr DEPUTY SPEAKER (Mr Andrews) —Order! The discussion has concluded.