Senator BOSWELL —My question is addressed to the minister representing the minister for small business. Minister, you would agree that the small business sector is the engine room of job creation in Australia. You would also agree that the Labor Party's only contribution to small business over the last 13 years was an increase in taxes and paperwork, running up interest rates of over 23 per cent for small business, overseeing record small business bankruptcies and load ing small business down with unfair dismissal laws. In contrast, what are the benefits that the first Howard budget offers the engine room of the economy—small business?

Senator PARER —I would like to thank Senator Boswell very much for that question. It is interesting that we have been in government for six months now and the first question we have had from the opposition relating to small business came from a new senator today. He was silly enough to ask a question on the minutiae of capital gains tax when it was his government that brought in capital gains tax.

The Labor government never recognised or had any understanding whatsoever of the small business sector. It did not recognise that there are 800,000 small business people out there who create real jobs. You went out of your way over a long period of time to make it difficult for those people to create those jobs. We all know the reason—because the industrial arm of the Labor Party does not like small business; they are traditionally non-union employees.

What this government is doing after 13 years of devastation by the Labor government of the past is attacking the budget deficit. By doing that, the government will ensure a downward pressure on interest rates. This is vital for small business, which borrows some $46 billion from the Australian banks. The previous government's irresponsible fiscal policy, to which Senator Boswell referred, crippled many small businesses and, in the process, created high unemployment, particularly among young people.

We have kept our election commitment to reduce the provisional uplift factor. This will inject $180 million into the small business sector, which they will then use to reinvest. We have kept our election commitment to allow small business to defer the capital gains tax arising from the sale of their business to a like business or to use it to fund retirement. Again, you never understood all that; it was beyond you. You did not understand that small business people build up their businesses for their own retirement funds. The previous government refused to do this.

We have stopped the contentious tax law No. 5 which was introduced by the previous government. It would have changed the status of subcontractors, creating not only a nightmare for small business but yet another union type push to make contractors employees rather than contractors. The roping in of the industrial side became the roping in of the fiscal side. We have raised the threshold for fringe benefits tax exemptions to ease the compliance burden for small business.

I could give the chamber many more examples of the benefits of the budget that we bring to small business. One of the most important ones is the industrial relations reform. You were so out of touch in government. If you had had your ears and eyes half open you would have realised that the greatest disincentive to employment by the small business sector was the unfair dismissal clause in the Industrial Relations Act.

In conclusion, the Deputy Leader of the Opposition, former Senator Gareth Evans, is now, as he says, suffering from relevance depravation syndrome. Now he knows how small business felt over the 13 disastrous years of Labor government.