Small Business Breakfast with Steve Irons MP

June 15, 2016
Transcripts

E&OE…

PRIME MINISTER:

… I was yesterday with Luke Simpkins in Cowan. We were talking there with young men and women who were- some of them were still at school, some were leaving school, some of them had just started apprenticeships. They were there with some of their employers, they were all small businesses. Those businesses were growing and they were taking on young people and they were only able to do that because they had the confidence that the economy was growing.

So that’s the best thing to underpin the security of every Australian’s job, strong economic growth. We have a plan for economic growth. We have a plan for jobs. That is what our national economic plan is all about.

Our opponents have no plans for jobs, they have plans for spending. They have a plan to spend and run bigger deficits over the next four years. Larger deficits than is set out in our budget. They are going to run bigger and bigger deficits and then they claim they are going to spring in to balance. Well come on. We know that we have a budget, we have an economic plan that will back you.

Let me talk about some of the specifics of it. First and foremost and this I think would apply to many of you here, we are going to bring down tax on business, on company business tax, including on unincorporated businesses. Obviously most businesses of any scale are incorporated. We are going to bring down company tax over the years until finally in eight years all companies will get a tax cut.

But next year and over the next few years, the companies that will benefit are small businesses, small companies. So for example from 1 July companies with a turnover of $10 million or less will get a tax cut and will pay 27.5 per cent company tax, 2.5 per cent tax cut.

Labor says they’ll only support tax cuts for companies with a turnover of up to $2 million. Now there’s a lot of them but they are small businesses, very small businesses, for the most part. Do you know right here in Swan, in Swan, 15 per cent of all of the private sector employees in this electorate work for businesses with a turnover of between $2 million and $10 million. Some of them may be the businesses you work for, or you own, or you manage.

Now all of those employees will benefit from that tax cut, because that will make their business they work for stronger, it will give them more money to invest, it will give them more money to invest, it will give them more confidence and of course, more confident business is able to invest grows, is able to pay its employees more and hire more.

Now this is pretty straight forward economics. It used to be accepted by the Labor Party. Paul Keating cut company tax twice for precisely that reason. Bill Shorten advocated cutting company tax for precisely that reason only a few years ago. Chris Bowen the Shadow Treasurer wrote a book about why it was so important, because it is quite clear we all know this if you want more of something you reduce the tax on it. If you want more investment lower the tax on investment.

If you want less of something increase the tax on it. That’s why the Government has increased taxes on tobacco to discourage people from smoking, and you know something, it works. That’s been one of the big public health successes in our generation a reduction in smoking.

So what we’re doing is we’re supporting business, we’re supporting investment and that’s the way we support jobs. That’s the thing that will ensure- the fact that will ensure that these young ladies here will have the prospect of a good job because if there’s a strong economy there will be plenty of businesses that are hiring that are expanding and we’re backing them, we’re backing you.

Now in addition to that we understand and you know this better than any of us – we understand how Western Australia is in the forefront of the transition from an economy that was fuelled up by mining construction boom. It got up to 8 per cent of GDP mining investment and construction. It’s come back down to less than half of that and that adjustment was always going to happen but what you’ve seen is a transitioning economy where jobs are being created again.

You are getting job growth here in Western Australia. Of course it’s been- it has had to recover, we understand that, but why has it recovered? It has recovered because we have a strong and diverse economy because we’ve opened up big markets in Asia with our big trade export deals. That didn’t happen by accident.

Opening up the China market in the way that we did and Andrew Robb of course was the Trade Minister who negotiated that, that is one of the greatest opportunities for our country and it has seen diversified growth right across the board particularly in regional Australia including in Western Australia.

All that wonderful West Australian wine and food is now heading up north in volumes never before seen. You are seeing more tourism coming this way. More services going that way. Many of you that are involved in consulting and design will be doing more work in Asia than ever before.

All of those doors have been opened by us. We have done those big trade deals in this term in less than three years; Japan, Korea, China, a very big enhancement to the Singapore deal and the Trans Pacific Partnership. How many trade deals did Labor do in six years? Not one.

They opposed the China agreement think about that. Our biggest export partner by far taking half of Western Australia's exports the Labor Party opposed that China Australia Free Trade Agreement and then finally grudgingly accepted it notwithstanding the strong union campaign against it. 

So this is an election where there is a clear choice. People are voting now. They will be voting today. They voted yesterday. They are voting every day up to the 2 July.

Every element of our plan will deliver stronger economic growth and more jobs and we can afford it. We are bringing the budget back into balance. It’s all set out there in the budget paper. We didn’t do a glossy document with a lot of pictures and no numbers. We got the budget ticked off by the departments of Finance and Treasury in the pre-election fiscal outlook document just before the election.

So you have got a clear plan from us every element of which will secure your future. What have you got from Labor? Higher taxes, $100 billion over the decade. They are going to increase capital gains tax. Is that going to encourage you to invest more? If you have to pay more tax than you do already on any gain you make? Of course not. It discourages investment.

I know Steve said many of you are involved in the property sector. What do you think in a market like this in Perth where property has been soft over the last few years what do you think banning negative gearing is going to do? Pulling a third of the buyers out of the market?

It will send rents up. It will send home values down. It will undermine the prospects of new developments. This is a reckless approach, an anti-business approach that will only undermine confidence and this in a world where there are many opportunities for sure.

This is the most exciting time in human history. This is the time of unprecedented economic growth both in scale and pace, but there are some challenges and risks out there. What is going to happen with the vote in the UK? Is Britain going to leave the European Union? We don’t know, they could, they might make that decision.

There are many risks and uncertainties here. You see that in reports from international markets every day. What we need is a strong, stable government, committed to business, committed to growth and jobs, able to spend record amounts on education and health, because we can afford to do so and because we are backing the enterprises that drive the economy that ultimately pay the taxes that enable that to be done and live within our means.

So it's a very clear choice. My Government with Steve and all our colleagues committed to growth and jobs and with a plan that will deliver it. On the other hand we have Labor, anti-business, spending, higher debt, higher deficits, no way of paying for it, undermining the investment upon which all depends and looking at the prospect of yet another unstable chaotic alliance with Labor, the Greens and Independents.

If you think that is a recurring nightmare or a nightmare that could recur just remember this; you’re only waiting for Julia Gillard and Bob Brown to put their hands up at this election. You’ve got the Labor Party, you’ve got the Greens, you’ve got Tony Windsor is running again and even Rob Oakeshott.

So it's a very clear choice if you're voting today, or any day between now and 2 July - a very, very clear choice; a national economic plan from us which will deliver growth and jobs backing the enterprise of Australians, backing the enterprise of Western Australians, on the other hand, an anti-business, anti-growth, anti-jobs agenda from a chaotic Labor-Greens-Independent alliance if you can call it that.

The choice is clear. We have the plan, we have the candidates, and we have the members, and we have Steve Irons here in Swan and I want to thank you for your support for Steve this morning.

Ends

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