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Wednesday, 28 February 2018
Page: 2283

Mr LAUNDY (ReidMinister for Small and Family Business, the Workplace and Deregulation) (15:24): Well, there you have the current baton carrier for the New South Wales Liberal Party—Labor Party.

Honourable members interjecting—

Mr LAUNDY: Jump sides! Jump sides! Only on the weekend we read of the inspiration for the member for McMahon's economic career, Paul Keating. It's, what, half past three? Can you imagine Paul Keating, that battler for the westie out there in Bankstown, sitting in his Eames chair at Potts Point, in his Louis Vuitton robe and Gucci loafers—and, as it's 3.30, with a glass of sherry—listening to that? I know the member for McMahon's heart's not in it. I know his agenda. I know his heart's not in it, because, when it is, he rallies to the cry. You can't hear yourself over the top of his cheering for what he actually believes in. The reason you can't hear it now is that he doesn't believe in what he is saying. To argue that the $65 billion tax cuts are for the big end of town, when half of them go to small and family businesses, is just lunacy in the extreme. It is economic vandalism writ large.

The reality of business in this country—I said it the other day—is that it doesn't exist in a vacuum. Businesses interact with businesses irrespective of size. We caught up with Qantas's Alan Joyce last Friday. There are 3,000 small and family businesses in their supply chain. That is how it works when you reduce tax, and the member for McMahon believes it in his heart of hearts. He has written it in books, time and time again. The quotes get regurgitated back at him at this dispatch box time and time again. And, in saying it, he was right. He was right. When you stand up—

Dr Chalmers interjecting

Mr LAUNDY: I wasn't here, Member for Rankin! When you stand up and you say that you don't want to give tax cuts to big businesses but then argue that they won't interact with small businesses, you're just ignoring the reality. It's not trickle-down economics; it's the truth. It's how the economy functions. Those on the other side have written book after book, book after book, about this being the case.

The first and last great reforming Treasurer, who the member for McMahon is so keen on, got it. He not only got it but he did it. And what happened? The economy was reformed. It works. Those on the other side are looking at big business in isolation. You are completely ignoring the fact that the economy is a dynamic and vibrant thing and ignoring interactions between companies.

As I said, many small and family businesses are in supply chains. At that Qantas hangar last week, I heard of a Toowoomba family that Qantas have given a go to. They used to get their planes painted offshore. A Toowoomba family has been given the chance of a contract to paint Qantas's planes—a small contract to start, but, if they can deliver consistently and on time, they will get a bigger bite of the cherry. I heard from Qantas that Cape Grim beef from Tasmania is served on their planes, along with wine from around Australia. They are actually the third biggest consumer of Australian wines, after Coles and Woolworths. The majority of those wineries are small, family owned businesses up to medium-sized businesses. There is this lunacy that happens in this place too often of defining the size of a business by turnover.

I had a guy come up to me in my electorate a couple of weeks ago. He is a luxury car wholesaler. He works from his kitchen table at home, with a mobile phone as his instrument of trade. He sells, in a good week, three to four prestige cars, and in a bad week he sells a couple. He makes between 55 grand and 155 to 200 grand a year. He turns over $15 million to $20 million a year. He does not have one employee. He works on wafer-thin margins. Turnover to define business size in this country is absurd. If you turn over $10 million and run at two or three per cent—

Opposition members interjecting

Mr LAUNDY: You can't argue that turnover is a part of this equation, along with arguing that businesses don't interact. I know the member for McMahon is being dragged there kicking and screaming, but then you get loony left policy being dictated by Sally McManus, being repeated within 48 hours by the member for Gorton and then wending its way into official Labor Party policy at the National Press Club.

There have been these figures of 20 per cent as the increase in company taxes and two per cent as the increase in wages in the last 12 months. Of that 20 per cent, the overwhelming majority—more than two-thirds of it—came in the December quarter of 2016 when commodity prices, especially for iron ore and coal, nearly doubled. In fact, the last two quarters of company tax profits in this country have actually gone backwards. If the system of minimum wage increases proposed by the Leader of the Opposition, which is purportedly supported only lukewarmly—and the member for Rankin and the member for McMahon, in their defence, have back away from these comments—is not decided by the independent umpire but by lunatic 28 per cent increases mandated in the minimum wage, you will have businesses across the board going out of business, and employees will be the losers, along with those business owners.

You are talking about irresponsible economic policy being made up because the Leader of the Opposition has become so weak internally that he has had to embrace the left wing of the Labor unions. That's the reality of it. The Leader of the Opposition, when he was the assistant Treasurer in this country, the minister responsible, espoused time and time again exactly what the member for McMahon has espoused in his career, along with what the former member for Blaxland did and delivered when he was in government in the late eighties to early nineties. This is the problem, and the problem is simple: there is a misunderstanding on that side. Some of them get it, but they've been hamstrung by those above them to fall into line with policy.

This policy and the platform that they are talking about is dangerous to the economic wellbeing of this country. If you attack business in this country, irrespective of size, you are by default attacking its employees. Any attempt to pit workers against employers is another frustration. It is the politics of envy. The reality, especially in small and family business land, is that the most valuable asset small and family business owners have at their disposal is their staff. They get it. They operate side by side with them on the front line. They go to their weddings, their christenings, their birthdays and their funerals. The staff on the front line of small and family businesses become a quasi part of the family. That is exactly what we are talking about. That is how business operates in the real world.

The proposed policies of those opposite, should they be elected, will go from minimum wage increases to completely tearing up and rewriting the industrial relations laws in this country to give their union mates unfettered access to labour markets across the board. Why? It is because the union model is broken. Unions now represent less than 10 per cent of the workforce in the private sector in this country. Unions are telling the Leader of the Opposition loudly and clearly that they need a new business model. The problem is that the policy platform that this team is describing will not only give them a new business model but, at the same time, unleash industrial wars the like of which we have not seen in this country since the 1970s. The result of that will be that businesses will close, irrespective of size. The real losers will be the workers—the people that those opposite purport to represent.

This is the reality of what goes on. The sad part is that I know the sensible economic minds on that side absolutely agree with what I'm saying, because they've said it time and time again. They've now been hamstrung by positions where they have to fall back and tow the company line. The real economic plan, as I keep saying, lies with lowering tax—both company and personal, irrespective of size—across the board so that this economy can be unleashed and its productive capacity harnessed. Wage increases will follow, and those employees across the country will be far better off.