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Wednesday, 17 October 1984
Page: 1858

Senator HILL(3.09) —One of the areas of greatest disappointment in the performance of this Government, of which there have been many, has been its record in relation to small business. Disappointment has occurred particularly as a result of expectations the Government built up prior to the last election. It offered the small business community what it called the 'Australian small business action program'. I repeat: It offered action. As it adopted almost all that had been called for by the small business associations, particularly the Council of Small Business Organisations of Australia, it is not surprising that its policy was embraced. COSBOA welcomed the election of the Labor Government. It made the great mistake of taking the Australian Labor Party at its word. It believed the promises Labor made before the last election. Now, like so many other interest groups, it has learned a lesson.

Those who listened to the Prime Minister (Mr Hawke) at Willunga during the last election campaign promising that there would be no introduction of a wine tax and those who believed Labor when it said it would not renege on the Alice Springs-Darwin railway have learned not to believe in this Government's election promises. Small business has been treated cynically by this Government, but I do not think anyone would have appreciated the extent to which this Government has failed to perform and the almost total failure to meet the program it set.

Today I want to run through Labor's promises. It will not be a pleasant experience for Government senators to be reminded of all the promises Labor made to small business before the last election. I also want to look at its record of failure to perform on those promises. But it is important to remind small business of Australia as to exactly what Labor did promise. Small businessmen will have the opportunity to show, at this forthcoming election, that Labor may have treated them as mugs once but they will not be treated as mugs twice. I then want to look at what the Opposition is offering; that is, a well thought out, constructive policy package which does not promise the world but rather responds to small businessmen's real needs. I am pleased to indicate that the policy has been released today. It has been developed over the last 18 months.

What has been developed in the Opposition's small business policy is a policy that is responsive to small business. Roger Shipton, the shadow Minister for small business in our Opposition, has travelled the country listening to small businessmen and small businesswomen. I remind the Senate that only some short time ago he arranged and held a successful small business seminar in Sydney which was supported by business people from all over Australia. If this Labor Government had been meeting the reasonable expectations of Australia's small business people they would not have turned up in their masses to that conference . But they turned up because they wanted to speak to the Opposition about their aspirations because those aspirations had not been met by this Labor Government.

The real concerns of those business people are addressed and reflected in our policy. These businessmen were then given the opportunity to comment upon the drafts as they were prepared. We have listened and responded to their real needs . My colleagues Senator Missen and Senator Crichton-Browne will look at specific policy areas which will benefit small business. Senator Missen will speak to the comprehensive package for reform of the regulatory process in this country which was put down yesterday. All small business can reasonably claim to be overregulated. The policy developed under the chairmanship of Senator Missen will offer positive relief not only in relation to future regulation but also in relation to past regulation. As I indicated, Senator Missen will detail this policy. It can be contrasted with Labor's interventionist approach. The Opposition policy which will maximise competition and minimise government intervention will be music to the ears of small business.

This time small business will not be fooled by the Prime Minister's sudden election time interest last week in the subject of deregulation. Is it not a coincidence that at election time, as in this whole area of small business on the last occasion, the Prime Minister suddenly becomes interested in the subject . One of the few small business promises that this Government has kept is the one that it was not willing to indicate that it supported smaller government. Senator Crichton-Browne will look at another of the major burdens of small business; that is, the inflexibility of Labor's wages policy to deal with the widely varying conditions faced by small business.

The Opposition's wages policy recognises that individual small businesses have individual problems and opportunities which will inevitably be overlooked by a solely centralist approach to wage fixing. Our more flexible policy, which Senator Crichton-Browne will detail, again will be applauded by realistic forward looking small business, employers and employees alike. Senator Boswell will then join this debate on our side. He is a person with many years of practical experience as a small businessman. He is able to speak the language of small business. He will speak to small business and not, as this Labor Government does, at small business.

I will move to Labor's record and the promises it made before the last election . These promises are reflected in a policy released by Bob Hawke on 13 February 1983, headed 'Labor's Policy for Small Business-An Action Program'. The document states:

It will provide Australian small business with a New Deal.

The gall of that man. The document continues:

A Hawke Labor Government will move to implement the . . . Programme as soon as it is elected to office.

Let us test the performance of that promise. Firstly, let us look at one of the critical areas to small business, and that is taxation. In that document Labor promised to allow small firms full retention of profits where these funds were to be used for genuine business purposes. Of course, it has not kept that promise. It promised to allow the option of quarterly instalments of provisional tax; it has taken no action in relation to that promise. It promised to allow a full month for remittance of sales tax. One would not have thought it would be a very difficult promise to keep but, again, it has failed to keep that promise. It promised to exempt industrial research development grants from tax and, again , it has failed to keep that promise. There were four specific tax promises Labor made before the last election and it has not kept one of them.

I will move to the area of finance, another area obviously of major concern to small business. Labor promised to expand the role of the Commonwealth Development Bank to lend to small businesses, including debt and equity packages . There has been no action upon that promise. It promised to investigate the establishment of an over the counter market in unlisted shares. Of course, the Commonwealth has done nothing in that regard although the States have been quite active. It promised to convert the Australian Industry Development Corporation into the Australian Industry Development Bank. That has not occurred. It promised to encourage and facilitate any initiative by private financial institutions which will improve the provision of finance for small business. It has not met that promise. It promised to increase the borrowing entitlement of the Commonwealth Development Bank and I am pleased to concede that it has in fact freed the bank from Loan Council control. Finally on finance, it offered administration of monetary and banking policies to avoid sharp increases in interest rates on trading bank overdrafts. It has taken no specific action in that regard and in fact the real interest rate had increased under this Government.

I will move to the field of education, training and advice. This Government promised the adoption of a strategy for the co-ordinated and rational development of small business education and training throughout Australia. That has not occurred. It promised to establish small enterprise counselling training programs. That has not occurred. It promised to establish referral centres known as small business bureaux in each State. There were already small business bureaux and corporations in each of the States. The very promise shows the ignorance of this Government in this field. It promised to arrange for private consultants to be available. There has been no visible action in that regard. It promised to provide grants to trade associations wishing to develop specific management training programs and, again, there has been no visible action. It promised to establish marketing and promotion services attached to small business bureaux and, again, there has been no action. What a pitiful performance in that area.

I will move to fair competition, which is one area where honourable senators might have expected this Government to act. It promised to strengthen the Trade Practices Act. That has not happened. It has put out a Green Paper, a talk paper , but in relation to the Act the only real action it has taken is to seek to remove sections 45D and 45E and thus weaken the power of non-union groups, particularly small business, to avoid being caught up in industrial disputes. This Government promised to upgrade the Trade Practices Commission. That has not occurred. It promised to introduce franchise laws to protect small businessmen. There has been no action. It promised to seek the co-operation of the States to ensure that proposed new shopping centres are in the best interests of the community. There has been no action. It promised to develop, in consultation with the States, a standard lease agreement for retail shopping centres. Again there has been no action.

One could continue through this whole policy paper and one would see that the result is much the same. In the area of Government purchasing this Government promised to enact a buy Australian Act with special reference to small business. What a fraud. Not only has it not occurred but also expenditure for the Buy Australian campaign under this Government has been reduced by 89.6 per cent. It promised to persuade State governments to give preference to Australian firms in general, in small business in particular, and that has not occurred. Let us look at its policy on information and research. An increase in funds for research has not come as promised. Special research institutes have not come. It promised to increase dramatically the funding for the Australian research grants scheme. That has not happened. We know the embarrassment caused to the Government by its own Minister for Science and Technology, Mr Barry Jones, who deplored the fact that his Government was not prepared to meet promises on greater research facilities. The only area in which the Government seems to have done anything is in the reform of its own bureaucracy. It said it would turn the small business branch of the Department into a small business division and it has done that. It said it would turn the Small Business Advisory Council into a Small Business Council and it has done that.

But what does that mean? We looked at and explored in the Estimates what it means. We looked under the new division and we saw that there was a new publications branch. We asked what extra has been achieved by the branch. The answer we got from the officer was:

What has been going on and what happened last year are pretty much in the same category-it was just a little more of the same last year.

What about the new Small Business Council? The Council is searching for a role and it has written to small business itself for help. What a disappointing performance. This Government has implemented about three or four out of some 35 separate programs that it promised to implement immediately. That is an embarrassment. That is a real indictment for this Government. It is not surprising that I do not see the name of the Minister for Industry and Commerce (Senator Button) on the list of speakers in this debate although I am pleased to see that he has now entered the chamber. It is something that must be embarrassing to him.

All this might not be so important but for the important role that small business plays and can play in our economy. Of approximately 730,000 enterprises in Australia 93 per cent employ less than 10 people. Honourable senators on this side of the Senate believe that small business will be the major job creator of the future if it is given the right economic environment and if the Government is sensitive and responsive to its real needs. That is what our small business policy seeks to do.

Our document is some 22 pages long. I obviously do not have time to look at it in detail but I commend it to small business. As I have indicated, two of my colleagues will look in greater detail at the areas of wages policy and regulatory reform. There are four other areas I want to mention in this brief debate. The first area is that of taxation. I have indicated to the Senate the total failure of this Government to meet the specific promises it made to small business in relation to tax. What have we said in this policy in relation to taxation? We have said to small businessmen that a 46 per cent marginal rate of tax on average weekly earnings is too high. We will reduce that income tax and we will broaden the tax to enable us to do so.

We have said that we will retain the investment allowance at the current 18 per cent with a view to restoring it to 20 per cent because we want to encourage investment in jobs in the small business sector. We will institute a phased and equitable system for the removal of double taxation. Small business now knows that we are genuine in that regard because we commenced that process when we were in Government. But, of course, this Government came into office and immediately removed the benefit that had been given in that regard. We have indicated in this policy that we will provide a 50 per cent write-off premium in respect of private industry research expenditure. We will do that because we appreciate the importance of a research capacity to private industry in this country. We understand what is the real cost if that capacity is to be provided by small business and, therefore, we are prepared to give this incentive. We also know the hassle of the cost of compliance with sales tax administration. So , in this policy we have said that we will review and reform the procedures in order that such costs might be reduced.

The second area that I want to touch upon is education and training. We are concerned that young people are not learning about the commercial world in which they live. We know that small business knows what we are talking about in this area even if the Government does not. We commend small business to review the whole series of positive policies that we offer in relation to education and training. The third area I want to mention concerns sub-contractors. Our support for sub-contractors as genuine, independent business people is restated in this policy. We see them as being squeezed between governments and unions. We will set out to reverse the threats to sub-contractors that this Government is at the very least condoning.

The fourth area which I want to mention, which is specifically dealt with in the policy, is the need to assist small business with access to world markets. Small business has the vision but the cost in money and the cost in time in getting into the wider markets that a total world market provides are simply too much for small business. We see a responsibility for government in that regard. We detailed in our policy how the next coalition government will give small business a real opportunity in that area.

Mr Acting Deputy President, as I have indicated, Labor offered a new deal and, I remind you, promised immediate implementation. It misled small business in that regard. Small business knows for certain that this Government stands for big government and big unions and it has now learnt also to stand for big business. A nominal representation in Labor's pyramid by a seat in the Economic Planning Advisory Council will not be enough to regain the confidence of small business. Small business will not again be misled by Labor.