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Thursday, 5 May 1994
Page: 327

Senator KERNOT —My question is directed to the Leader of the Government in the Senate. The jobs compact is a welcome step forward for some, but in last year's budget the Prime Minister said to the long-term employed, `Sorry, you will have to wait for growth.' What is the answer today? It is, `Don't worry, rely on growth.' Is it not a shaky assumption to base the government's five per cent unemployment target on growth alone? Also, given the fact that in the past three years employment in larger businesses has fallen by more than 300,000 while, at the same time, small business has demonstrated a greater capacity to deliver real jobs by growth of more than 136,000 jobs, why did the government not do more in this white paper to acknowledge the special role of small business in generating the real jobs we are talking about? These are the ones the government keeps talking about but that we cannot find in the white paper.

Senator GARETH EVANS —Senator Kernot does not seem to have been listening to the very first answer I gave, which was designed, among other things, to directly answer that proposition. We are not relying simply on some kind of natural underlying growth which would occur in the absence of any particular government strategy designed to secure additional rates of growth.

  We certainly believe that, on the basis of the condition of the Australian economy now, after all the things we have done to move things along, and as a result of the condition of the international economy, we can reasonably expect, for the immediately foreseeable future, the present Australian growth rate, the highest in the OECD, to continue at around four per cent. This would, in itself, hopefully, add over 200,000 jobs a year, just as it has in the last 12 months. But the point that I have been making is that there are additional strategies in this white paper to create the very real jobs—or new jobs, if you like—that Senator Kernot is referring to.

  Not only are there the additional incentives for investment that I have already mentioned and will not repeat again in terms of the infrastructure tax breaks and things of that particular kind, but also the very act of moving down the path spelt out in the jobs compact, the very act of creating new skills, new confidence and new employability in that huge class of long-term unemployed at the moment will itself be a direct contribution to, in the slightly longer term—over the next two-, three-, four-year period; not directly and immediately—the creation of new jobs. This is simply because there will be new skills on which businesses can draw to rely upon in making new business decisions, which otherwise they would not be able to do with that particular pool of skills not being available.

  Plus, there is the additional contribution to the economy that is made in turn as each one of these people comes into the job market who would otherwise be excluded from it and would simply be sitting out on the sidelines as an underclass receiving, in perpetuity, unemployment or other social security benefits. So the economy itself is benefiting from the creation of new skills and new capability. Moreover, most of these job compact strategies that are set out in the white paper are very directly targeted to the needs of small and medium sized businesses in terms of the encouragement that is being given to them through the subsidies and case management strategies that are spelt out to employ people.

  This is not just employment on some sort of temporary basis on the slave labour wages that the opposition would have had us embrace with its particular so-called training wage, which is totally different from this strategy. There are incentives built into this for small and medium enterprises to take people on—initially, on a temporary basis, yes, while their skills are being built up—but hopefully on a basis which will result in sustained employment in those enterprises on a basis that is attractive for those particular enterprises. That is the strategy which runs right through this.

  I repeat: it is not just a social justice or equity strategy—as useful, viable, attractive and necessary as that is, and as unheard of on the other side of politics as it is. There is a real, hard-edged economic strategy, job creation strategy, built into the very fabric of this white paper. For Senator Kernot and the representatives of youth unemployed, or anyone else in the press who has missed the point about that, we cannot go on making that point too often. It is about employment and growth. It is about new jobs, new growth; not just the growth that is otherwise there. That is why it is a policy paper that deserves to be embraced with the applause that it has received.

Senator KERNOT —Mr President, I ask a supplementary question. We have said what we think is good about the paper—it has not been universally condemned—but the strategy the minister is talking about for small business is a minimalist one. The government's strategy is to encourage training. The minister says that it is good to train bank managers to be kinder to small business. The government had the opportunity to do something more meaningful for owners by saying, `We'll do something about access to finance.' Small businesses often have to borrow money to pay their provisional tax. Why has the government not chosen to do something more substantial now? What it has done is the minimum that it can get away with.

Senator GARETH EVANS —I think Senator Kernot's halo has got a little tight again. She is being holier than the small business pope himself who I saw on Lateline last night expressing his applause for this particular package and saying, yes, this would contribute to the creation of jobs and it would be supportable and supported by the small business sector for all the kinds of reasons that I have been spelling out.