Bill's Speeches

SPEECH TO COSBOA NATIONAL SMALL BUSINESS SUMMIT

SPEECH TO COSBOA NATIONAL SMALL BUSINESS SUMMIT

SYDNEY



THURSDAY, 16 JULY 2015


 

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Good evening everyone

I thank Peter Strong for his kind invitation to be here tonight.

When I became Labor Leader I also chose to take on responsibility in two portfolios: Science and Small Business.

I’m lucky to have the support of my dedicated colleague Bernie Ripoll, who has worked extremely hard to engage with small businesses across Australia.

I and Labor see small business and science, as enablers of our economy, engines of future growth, creators of new jobs and drivers of innovation.

I understand that small business is not just the backbone of our economy, it is a barometer.

You are more informed than most about the health of Australia’s economy – and have more invested in its success.

Every small business is an act of personal courage, and personal risk.

Revenues are volatile, progress can be slow, the chance of failure is always there.

And small businesses are often financed by the owner’s second mortgage, their family savings or a credit card.

The sacrifices you make can take a toll on your life outside work, on your family and your mental health.

Beyond Blue research tells us that mental health costs Australian businesses around $11 billion a year.

This is why Leanne Faulkner’s work – and your recognition of it – is so important and so worthwhile.

And because you’re invested and informed – you all know the Australian economy is not going as well as we would hope, or growing as fast as we would like.

Growth at 2.3 per cent is still nearly a full percentage point below trend.

Australian annual economic growth has now been below-trend for 11 consecutive quarters, and all but three of the last 27 quarters.

Australia’s unemployment rate has a six in front of it.

The number of people trapped in long-term unemployment has hit a 16-year high.

The number of people out of work for a year or more has risen by 18 per cent over the past year to 188,000.

That's the highest number since the late 1990s, and almost three times more than before the GFC hit.

And while unemployment has been rising – so has under-employment.

The labour force underutilisation number takes into account those seeking more work – and it has risen to its highest level since November 1998.

More and more Australians – whether they be small business owners or small business customers – are starting to wonder if economic growth is delivering for them, if the model we have is working the best way it can.

To put it another way, if we were having this dinner in 1991 and I told you we were in line for 24 years of uninterrupted growth.

You wouldn’t expect to be sitting here in 2015, with a 6 per cent unemployment rate an 18 per cent long term unemployment rate sluggish wages growth, and tepid investment.

And consumer confidence in the doldrums.

The Westpac–Melbourne Institute Index of Consumer Sentiment fell by 3.2 per cent in July, demonstrating clearly that pessimists outnumber optimists in the economy.

This has been the case for 15 of the last 17 months, with confidence now a staggering 17 per cent below September 2013 levels.

We urgently need a plan for building the next two decades of prosperity.

We need a plan for the jobs of the future, a plan to deal with the five big, non-negotiable shifts which will define the Australia of 2025.

  • Climate change and a clean energy economy.

  • The rise of Asia – the world’s biggest consumer class on our doorstep

  • The march of women to equality: in pay, opportunity and leadership.

  • Population change: two generations of Australian retirees living at the same time

  • And the digital technology revolution, fundamental changes in the way we live, work and communicate.


A strong, growing, diverse and innovative small business sector will be essential in helping Australians respond to these challenges.

I see small business as a key driver of Australia’s economic growth, in the immediate and long-term.

Your growth is hard won, it involves pursuing more top-line revenue and greater efficiencies in cost control.

And if we’re going to ask you to fill some of the void created by the end of the mining boom, then it is only fair to offer continued, meaningful support for the small business sector.

As you know, Labor backed the Government’s 1.5 per cent tax cut for small business, and their temporary, two-year, instant asset write-off.

In fact, we were the first party in the Parliament to vote for it.

We supported these small business measures, because we are committed to helping small businesses grow and thrive.

And we voted for these measures, because we remember how frustrating it was, for so many of you, when Labor proposed a 1.5 per cent tax cut for small business – and the Liberals opposed it.

We remember how disappointing it was, for millions of small businesses, when Labor introduced an instant asset write off - and the Liberals unwound it.

We remember how unfair it was, for three-quarters of a million small businesses carefully counting every dollar, when Labor introduced loss carry-back - and the Liberals abolished it.

We were determined to be better than this kind of petty negativity.

We supported the government’s proposals – from Budget night on – because we don’t automatically say ‘no’ to an idea, just because it doesn’t come under a Labor letterhead.

This has always been my philosophy: as a union representative and a parliamentarian.

Don’t search for the point of contention, focus on building a basis for consensus.

Begin by looking for the value in the other person’s proposition and work from there.

This was the approach I took at the AWU: striking the best agreements for workers – and business.

Delivering better pay, and greater productivity.

Safer workplaces, and a more flexible workforce.

My time at the AWU taught me about one of the most important agents for improving the living standards of working people: the good employer.

I took the same approach as Parliamentary Secretary for Disabilities.

The idea of a better deal for people with disability wasn’t new.

But for decades, no-one could agree on a way forward.

Until the ‘Every Australian Counts’ campaign, every group had approached the politics of disability in a different way, depending on whether they were advocates, carers or disability service providers.

The NDIS offered a common objective to unite around – and the newly formed National Disability and Carers Alliance took the debate from an internal conversation – to a national one.

Instead of worrying about the 10 per cent they didn’t agree upon – they concentrated on achieving the 90 per cent they did.

This is the leadership I believe in: initiating consensus, not instigating conflict.

I believe our system works a lot better when we focus on the quality of the idea, not who owns it.

When leaders act in the interests of the whole nation, rather than tilting at windmills, riding their own hobby-horses, or servicing the ideological fixations of their rusted-on supporters.

Of course, ours is a multi-party democracy.

And our Westminster system isn’t going anywhere, anytime soon.

There are always going to be fundamental differences in philosophy, in our values, in the way we look at the world.

So, I’m not advocating – or expecting – a mass chorus of ‘kumbaya’.

But, in Opposition, Labor has made a conscious effort to take a more constructive approach than Mr Abbott’s Liberals.

We believe you can hold the government to account, in a practical way.

Whether it be on budget repair, national security or support for small business.

I think empty, backward-looking negativity has consumed too much of Australia’s national energy in recent years.

Australia won’t be ready to face the challenges of the future, to build the long-term prosperity we need, if governing is reduced to a democratic tit-for-tat.

If new Prime Ministers spend the first half of their term trying to undo and dismantle everything their predecessors built and the second half promising everything, to everyone, to cling onto power.

All this does is create uncertainty for the Australian people, for business and investors.

We’re seeing this play out right now in the renewable energy sector, with potentially devastating consequences for billions of dollars in investment – and thousands of jobs.

Small business will pay a price too: in energy costs and supply.

This is why the role the Clean Energy Finance Corporation plays, in partnership with the major banks, helping small business finance new energy-efficient equipment and solar power is so important.

And this is why we need to preserve this co-operative relationship.

Because we won’t secure our future prosperity by picking fights.

This is, why in my Budget Reply speech this year I made Tony Abbott and the government an offer.

I said, let’s work together.

Let’s find a fair and fiscally responsible way to give small business the lowest corporate tax rate in Australian history.

Not a 1.5 per cent cut, a five per cent cut.

A real fillip for cash-flow.

A confidence kick-start for planning and investing in the long term.

Now I didn’t expect a pat on the back from the Prime Minister, or a spontaneous round of applause from Joe Hockey.

But I was surprised the government dismissed the idea out of hand.

Surprised – and disappointed.

Especially since I had made it clear I understood it might take more than the life of one parliament to achieve.

Nevertheless, my invitation stands.

And I’m interested in other ways of helping small business get ahead.

Today, more and more small businesses are moving towards becoming companies, with the legal protection of limited liability.

Incorporation helps promote asset protection, retaining profits for working capital, access to CGT discounts, succession planning and income distribution.

Currently, a series of very complicated structures are used to achieve these outcomes.

Setting these structures up takes time and money - and maintaining them is even more expensive and even more time-consuming.

We need to ask ourselves: how can we deliver the ongoing benefits of incorporation, without the ongoing burden of red tape, for more small businesses.

How can we create a single, simplified structure, tailored for small business – instead of the current complicated and expensive arrangement.

How can we maximise advantage for you, while minimising the hassle?

One option, adopted with success in the United States, is a change in the corporate structure, to create a specific class of corporations for small business.

This differentiated approach recognises that compliance measures should be tailored to match the size of businesses.

I understand, this is a complex change.

But Labor is up for a discussion with small business, representative organisations, accountants and the legal profession to make this arrangement work for Australia.

Backing-in small businesses also means better support for business lending and start-up finance.

Right now, it is still too hard for Australians to get the financing they need to start – or grow – their small business.

We need to change this – because so much of our future prosperity depends on harnessing Australian ideas.

Australian entrepreneurs, creating new markets for their world-leading products.

I want ideas born here, to grow up here – so we can create jobs here.

A Labor government will create a new $500 million, Smart Investment Fund, to back-in Australian innovators.

An incentive for entrepreneurs to develop their ideas – and scale them up.

Our Smart Investment Fund, will partner with venture capitalists and fund managers to invest in early stage and high potential companies.

This is a model has a definite, proven record of success.

I’m sure you’re all familiar with the story of Seek.com

A $2.5 million investment in 1998, helped grow what is now a $5 billion company, employing over 500 Australians.

We’ve also put forward our positive plan to work with Australia’s banks and finance industry to introduce a partial guarantee scheme: Startup microfinance.

I want to make it easier for Australians to turn good ideas into successful businesses.

To take their product from prototype, to market.

So many of our competitors for the jobs of the future already have a scheme of this kind in place: the UK, the US, France and Germany.

Singapore and Hong Kong are leaders in our region.

In the new economy, small businesses and start-ups will drive growth and create jobs.

This is why we’re also leading efforts to promote crowdfunding initiatives.

And why Labor is determined to support our next generation of designers, refiners, manufacturers and creators.

Better support for start-ups will also be particularly important for the women of Australia.

Two out of three women use their personal savings to finance their start-ups.

And four out of every ten women who start a small business, do so with less than $5000.

Our partial guarantee scheme carries minimal risk for government and private lenders, but it will make a tremendous difference to these up-and-coming entrepreneurs.

I see support for start-ups as an investment in success.

After all, as recently as three years ago, people spoke about ‘mumpreneurs’ as just a fad, women looking for a hobby or something to do…today they are rightly recognised as industry leaders.

These are Australians with great new ideas, running successful businesses and harnessing new technologies and social media to launch their products and services.

And the more women we can help succeed in small business, the faster we can close the gender gap – in pay and in retirement savings.

Friends, not for a minute do I underestimate the economic challenges facing Australia.

There are, undoubtedly, hard questions in front of us.

But none of you got to where you are by shrugging your shoulders and saying ‘it’s all too much’.

None of you built your success by waiting for something to turn up, or just hoping for the best.

You rejected pessimism, and complacency alike.

You didn’t hang back to see which way the crowd was heading.

You took risks, you made sacrifices, you led the way.

Of course, there will always be those who think the Australian model of inclusive growth, of prosperity and opportunity shared, can’t cut it.

There will always be nay-sayers who would prefer an Australia run for the strong at the expense of the weak, the big at the expense of the small.

But to all those cynics and the critics who doubt Australia’s ability to face the challenges of the future.

To all those who think the world has become too tough for Australia to compete in.

I say, go and visit a small business.

Spend half an hour at an Australian workplace.

Talk to any of the millions of Australians who go to work every day.

People adding to our national wealth, with their efforts.

Raising families, and building communities.

It is this spirit, this belief in reward-for-effort and the value of work.

This belief in innovation and enterprise, which will help deliver the new wave of long-term growth in the decade ahead.

There is nothing Australia cannot achieve, if we work together.

Employers and employees.

Businesses and unions.

Commonwealth and states.

Government and private sector.

Together, we can build a prosperous future, beyond the mining boom.

Together, we can compete and win in our region, on our terms.

Together, we can prepare Australia to meet the challenges and seize the opportunities of the next decade.

Together, we will succeed.

ENDS

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