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National Small Business Summit, InterContinental Hotel, Sydney, 12 June 1996: address



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+61Ϊ2734105 MIN JOHN MOORE

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F-6S8 T-077 P-001 JUN 13 ’96 18:08 - · · · . „·Ï‡ ·Ï‡·< ίχν^ « ι« Î’ ΐ·> ι \j.5sx.·-*» —r . e s r x · ^ / · —,nuieRfrR»71££1-a = -

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Address by:

The Honourable John Moore. M.P.

Minister for Industry, Science and Tourism

to:

The National Small Business Summit

Intercontinental Hotel, Sydney

12 June 1996

Check Against Delivery

+61»o2734105 MIN JOHN MOORE

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Geoff Prosser, State Ministers, Ladies and Gentlemen, it is a pleasure to

welcome such a distinguished audience to the National Small Business

Summit.

It is a particular pleasure to welcome State and Territory Ministers and

representatives of local government to this important meeting.

Today’s Summit is one of the key components of the Government’s

action plan for small business which it is implementing in its first

hundred days in office.

The Summit will be chaired by Geoff Prosser, the Commonwealth

Minister for Small Business, and brings together our State counterparts

and representatives from local government and small business.

I am looking forward to the presentations by the small business

representatives this morning.

Small business is the life blood of the Australian economy.

It drives economic growth and is the generator of new jobs.

The Prime Minister’s support for small business is well known.

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He has made it clear that the Government is totally committed to

ensuring that this vital sector prospers and flourishes.

A key to ensuring a better environment is to reduce the onerous burdens

of regulation that small businesses face in their day-to-day operations.

Today’s meeting will consider the paperwork and compliance burden

faced by small business.

It will develop suggestions and ideas for ways in which this burden can

be dramatically reduced.

State and local government also play a critical role in setting the

regulatory environment in which business must operate.

This Summit is an example of the close cooperation that is necessary

between all spheres of government if we are to reduce the burdens on

business.

I am confident that the Summit will produce a number of major

initiatives which will benefit small business.

In addition, the Summit will provide a major input and impetus to the

work of the Small Business Deregulation Task Force.

+61&2734105 MIN JOHN MOORE

F-6 6 8 T-077 R-004 JUN 13 ’96 18:08

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I am pleased to welcome Charlie Bell, the Chief Executive of

McDonalds Australia, and Chair of the Task Force to this morning’s

session.

The Summit and the work of the Task Force are the first stage of the

Government’s campaign to roll back the tide of unnecessary regulation.

I am the first to admit that we need some regulation, to protect

consumers, safeguard the environment raise standards in business and

ensure public safety.

However, there are far too many unnecessary regulations.

Just think of the scale of the problem.

Since the 1960s, approximately 60,000 regulations have come into

force.

Some are in conflict and some redundant.

This burden of regulation:

• stifles enterprise;

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• impedes innovation;

• restricts creativity; and

• smothers business with the dead weight of paperwork and

compliance.

Small business is particularly vulnerable to over regulation and it

struggles hard to cut through the red tape that hampers its day-to-day

operations.

Red tape is not just unnecessary government paperwork.

It can include bad administration, lengthy delays in decision making

and poor or misleading information.

Red tape leads to higher costs and missed opportunities for business.

It hinders growth and stops jobs being created.

Axing needless regulations will improve our competitive edge and give

Australian industry a chance to win in world markets.

+6162734105 MIN JOHN MOORE F-6 6 8 T-077 P-006 JUN 13 ’96 18:09

Within my portfolio,-there are a number of Acts and regulations that

have long outlived theg proper time.

These regulations, whi:h impose costs on business and ultimately the

consumer have little oil no relevance in 1996 and will be removed.

By way of an example [the Commerce (Imports) Regulations made under I the Commerce (TradedDescriptions) Act 1905 include a requirement

that:

in information appl

volume is

lying to the volume o f an article where the

expressed in terms o f the gallon, “a fraction other than

1/S, 1/4, 1/2 or 3/4 shall not be used;

But just to add to the confusion, the regulation goes on to require that:

“the fraction 1/8 s\iall not be used with a whole number in

expressing the volume o f the article ” .

Clear as mud.

+6162734105 MIN JOHN MOORE F-6 6 8 T-077 P-007 JUN 13 ’96 18:09

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Those regulations also say that:

a trade description on a pre-packed article shall not contain a

prohibited expression or a restricted expression except in certain

circumstances.

On the surface, this requirement could appear reasonable.

This is until you realise that amongst the terms that cannot be used to

describe a product are such heinous terms as: “large ”, “ family ”,

“economy”, “ jum bo”, “king”, “queen”, “huge”, “giant”, “bigger”

and “extra ”

The Commerce (Imports) Regulations are not the only regulations where

outdated or duplicative regulations exist.

My portfolio has also been reviewing the Customs (Prohibited Imports)

Regulations.

For example, in Schedule three, there is a prohibition on the import of

“insulated electrical conductors in the form o f cable or cord”.

It was inserted into the regulations 1 believe in 1919.

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Today, we have a range of Australian standards which apply to

electrical wiring and components, and these are binding on all such

goods sold in Australia, whether made here or imported.

Clearly, these regulations are anachronistic.

I am pleased to announce the Government’s intention to repeal such

regulations in the Commerce (Trade Descriptions) Act 1905, and the

consumer product aspects of the Customs (Prohibited Imports)

Regulations.

They are only the tip of a very large iceberg and much more needs to be

done.

The Government is going to break the shackles of regulation that bind

business.

On the second of May, the Prime Minister, John Howard, announced the

formation of the Small Business Deregulation Task Force.

Charlie Bell and his team will report to the Government within six

months with a plan to reduce the paperwork and compliance burden that

confronts small business.

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The Task Force’s target is to make recommendations to reduce that

burden by 50 per cent in three years.

The Task Force is examining the impact on small business of a range of

Government regulatory and statistical requirements, as well as the cost

of complying with various Commonwealth taxes.

I know that the small business representatives - in their presentations to

the Summit - will be putting forward a number of issues and ideas for

the Task Force to pursue.

Geoff tells me that the Summit will be considering issues such as

greater coordination between Government Departments and agencies

The aim is to reduce the demands on business for the same information

from a multitude of Government Departments, agencies and private

sector firms;

Another issue is for better assessment of the impact of regulation on

small businesses and building incentives into regulations

Where a regulation is deemed necessary and appropriate, the

compliance requirements for those with a good track record could be

reduced.

+6162734105 MIN JOHN MOORE F-6 6 8 T-077 P-010 JUN 13 '96 18:10

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These are only a few oj the ideas that the Summit will discuss but they

are an important contribution to the work of the Task Force.

I

I know that today’s Submit will unveil a number of joint

Commonwealth and Stpte initiatives. j .

i j

Today’s summit underlines the Government’s commitment to action

since its first day in office.

We are already developing the Government’s Three Year Action Plan I for small business. i

Key components of that Action Plan will be taxation and law reform,

addressing capital needs of small business and reform of the industrial ! relations regime. ;

The Government is already pursuing a number of initiatives in these

areas. ■

The costs and complexity of raising capital for small business will be

reduced by simplifying the Corporations Law.

I

We will exempt small ^business from onerous prospectus requirements.

i

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Our reforms of the taxation system will free up capital for small

business.

Small business owners will now be able to roll-over their capital into

like kind businesses and realise proceeds on retirement without fear of

Capital Gains Tax taking their hard won capital.

Legislation is before Parliament to reduce the provisional tax uplift

factor from 8 per cent to 6 per cent.

For too long, small business cashflow has been strangled by an

unrealistic uplift factor which is out of line with economic and income

growth.

We will also simplify the operation of Fringe Benefit Tax and reduce

compliance costs.

Currently, complying with FBT costs business nine hundred thousand

dollars a day.

We will ensure simplicity and consistency in FBT compliance and we

will considerably reduce costs.

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And most importantly, we have begun to overhaul industrial relations

and rejuvenate the ability of small business to employ people.

We have already introduced into Parliament amendments to the unfair

dismissal provisions to ensure a fairer deal for all.

It is a fact that we are well on our way to meeting our election

commitments to small business.

This is an indication of the importance the Government gives to the

contribution these enterprises make to the national economy.

if small business is to contribute fully to improving economic growth, it

must be allowed to operate in a favourable regulatory environment.

However, creating a favourable regulatory climate, does not just entail

reducing the paperwork and easing the burden of regulation and

compliance problems from business by clearing away unnecessary

regulation.

We must all ensure that, when new regulations are made, we minimise

the burden on business.

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It is particularly important that wc understand the full impact of any

new regulation on small business.

We must then seek the views of small business and take them into

account when we have to frame regulation.

It is imperative, when we are considering regulation, we all “Think

Small First”.

Above all, regulation must be fair and be seen to be fair.

To do this we need to adhere to some basic principles:

• regulators need to keep a sense of proportion.

• regulations must be proportionate to the problem they are

addressing.

As they say, “you don’t need a sledgehammer to crack a nut”.

Regulations must be simple, so they are easy to understand and easy to

comply with.

To me this is simply a matter of good regulatory practice.

+'6152734105 MIN JOHN MOORE F-6 6 8 T-077 P-014 JUN 13 '96 18:12

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Cooperation between the Commonwealth, the States and the Territories

is one of the most important tilings government can do to reduce the

burden on business

Therefore, J am encouraged that today’s Summit will also unveil a

number of initiatives across Commonwealth and State boundaries

These initiatives will cover:

• the promotion of good regulatory practice;

• initiatives to reduce compliance costs; and,

® greater cooperation and consistency at Commonwealth and State

levels.

It is a primary objective of the Howard Government to build stronger

co-operative relationships with all layers of government.

However, it must be said that our track record o f co-operation is not

bad.

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The Council of Australian Governments (COAG) which meets

tomorrow has had some notable successes in competition policy and

mutual recognition.

For example the 1992 Australian mutual recognition agreement signed

by COAG members has removed regulatory barriers to the movement

of goods and people in registered occupations between jurisdictions.

The current meeting of COAG will consider extending this scheme to

include New Zealand.

This Summit is another example of the value of a collective approach to

national issues - a collective approach which involves not only

governments but those effected by their decisions, the business

community.

In conclusion, I would like to say that I have been greatly encouraged

by the sense of cooperation and commitment that all the participants

have shown in the lead up to this Summit.

This will not only ensure a successful Summit but will also be of longer

term benefit as we build on today’s outcomes.

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MIN JOHN MOORE

F-668 T-077 P-016 JUN 13 -96

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With that Ladies and Gentlemen, 1 look forward to seeing the results of

what I am sure will be a very productive day.