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Tuesday, 8 November 2016
Page: 3155

Mr COLEMAN (Banks) (15:57): It is really good to have the opportunity to speak on this MPI on employment this afternoon. I want to pick up on one of the comments made earlier by the member for Gorton. He used the term trickle-down economics, and he said that the opposition did not support the government's proposed reductions in tax, because they were all targeted at people and businesses that would not benefit employment and so on. Frankly, it is just absurd, because what those opposite oppose is any tax reduction for any business that has turnover of $2 million or more. It is important to note—and this is often overlooked by those opposite—that turnover is not the same thing as profit. Turnover just means you might have taken $2 million in the door, but it does not mean that you are a very wealthy person with $2 million. It means that, probably, you have a very small percentage of that $2 million as the profit of the business. But those opposite oppose tax relief for any business that has a turnover of $2 million or more.

Helpfully, the Australian Tax Office has done some numbers on what the typical profit margin of a small businesses is. Let us take a newsagent. A newsagent with a turnover of around $2 million, according to the ATO, would typically have a profit margin of about six per cent. That means that the operators of that newsagent, after paying all their cost and so on, would be taking home about $120,000. They may be a family and there may be kids to support. And they may be employing other people in the newsagency. Those opposite think that is a big business—a newsagent making $120,000 a year—and they should not be entitled to a tax cut. We have all visited pizza shops. The ATO estimates that a pizza shop would make about 10 per cent on turnover—about $200,000. Again, they would no doubt be supporting a family and many other people for that quite small amount of money. But those opposite think that tax relief should not be provided to those small businesses that are employing so many millions of Australians. The list goes on. Furniture is seven per cent. A $2 million turnover furniture business, if it is doing well, will make $140,000 and support a family by doing so. But they think that is big business, and it demonstrates again the lack of understanding of how jobs are created.

Government does not create jobs; government simply facilitates an environment in which businesses can go forth and create jobs, and that is what this government has done very effectively. Since we came to office in September 2013, about half a million jobs have been created—half a million additional jobs since we came to office. Just in the last 12 months, the unemployment rate has fallen by more than half a percentage point. Dr Philip Lowe, the incoming Governor of the Reserve Bank, said back in September:

We thought a year ago that the unemployment rate would now be above six per cent, and here we are now at between 5½ per cent and 5¾ per cent.

Of course, in September it was 5.6 per cent. He said:

The various forward-looking indicators of the labour market that we track—job ads and job vacancies—are on a gradually improving trend. So I think we can look forward to continuing reasonable employment growth.

So there is declining unemployment and there is a plan to further boost the economy through providing tax relief to small business, but this is vociferously opposed by those opposite, who have a very bad record when it comes to job creation. Talk though they may about manufacturing, under the Rudd-Gillard-Rudd governments one in eight manufacturing jobs was lost. One in eight manufacturing jobs was lost under the previous Labor government, and that is a real indictment of their record.

What we do is take positive action that leads to job creation—nowhere more so than in the free trade agreements. Labor talked about such agreements for a long time but achieved nothing, with no major trade agreements closed in the six years in which they were in office. We then completed the China free trade agreement, and those opposite sought to oppose the China free trade agreement. They came to this place day after day after day, finding fault with the China free trade agreement, and of course that agreement has been a great boon to the agricultural sector and many others across Australia, delivered by this government. Under the stewardship of the member for Bradfield, we have an infrastructure plan, with $50 billion in investment across Australia, creating 10,000 jobs in the construction phase of WestConnex, a very important project in my electorate and another example of the very strong record of this government in job creation.