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Tuesday, 25 February 2014
Page: 861


Mr LAUNDY (Reid) (21:15): I have been in this place only a short time, but it has not taken me long to work out that politicians have a real skill in making things complicated. We have a structural budget deficit. I have heard economists trip over themselves to explain what that means. I come from Western Sydney and we like keeping things simple. As of 31 January we had 11.6 million people who had a job and were paying into the system and we had 23.2 million people drawing on the system.

We have an employment problem and the debate around it has been so poor. Why? Because I do not think enough people taking part in the debate have actually employed anyone. Those opposite come from a union background, and that is fine. Unions are relevant to them and 13 per cent of the workforce. But of the 11.6 million people that I mentioned, 7.6 million people are employed by small, medium and family businesses. That is 70 per cent of the workforce. Where is their voice? It sits on this side of the House.

Over the past six months those opposite have called for support for big business and today's example is Qantas. There is probably no better example of how commercial thinking differs from the thoughts of those on the other side. In 2000 when Virgin kicked off, Qantas had 29,200 employees and Virgin had none. Today Qantas have 33,500 employees and Virgin have 9,500. Over the next 12 months Virgin will employ 1,500 more people. So, whilst over the past 13 years the airline industry globally has struggled, we have had increasing competition and increasing employment. There is competition at play in this market, as there should be.

Governments should not be involved in this market. Government creates an environment that business operates in and ultimately businesses employ in. What has that environment been like? Over the past six years every business in Australia, irrespective of size, has had the expense side of their P&L mercilessly persecuted. At the same time consumer confidence has been shot to pieces. Whereas traditionally business owners would increase prices to maintain margins and ultimately their bottom line, they have not been able to do that. In fact, because consumer demand has been so weak, many have actually had to lower their prices at the same time as incurring increasing costs. They have turned to the expense side of their P&L and the expense that has been lowered to offset this is wages. SMEs have reduced their hours of operation or changed the way they run their business or the owners have worked more hours themselves and not paid themselves. Over the past six years there has been an unprecedented casualisation in our workforce and that has occurred to give employers the flexibility to reduce their expenses by lowering wages.

Here is where it gets even worse. The reality is that we do not have only an unemployment problem; we have an underemployment problem. The best piece I have seen on this was done late last year by former Labor senator John Black. He concluded that unemployment and underemployment in this country were running at around 13 per cent. Is it any wonder that yesterday we heard that youth unemployment is running at near 20 per cent in the west of my electorate in Western Sydney? From Auburn to Drummoyne, all the way through there, family businesses operating in shopping centres have laid off casual staff and are working extra hours themselves and not paying themselves. This is the reality. This is microeconomics. This is how it plays out on the ground.

Those opposite keep asking for our plan. The plan is simple. Get out of the way and let SMEs solve the unemployment and underemployment problem we have, as they have done in the past—and will do in the future. Get out of the expense side of every business in Australia. Let them take on bank debt, back themselves and employ people the way they have done in the past—and the way they will do in the future. The best way to do this is to repeal the carbon tax. It feeds into every expense in every P&L in this country. It takes no prisoners.

I know that the engine room of this economy has always been, and will always be, small, medium and family businesses. I just wish the Labor Party got it.