Thanks Nicole. It is great to be here. Thank you to each and every one of you for coming along, but more sincerely, thanks for all you do for the economy and the country. I do not think there is enough recognition even for enterprising men and women about the vital contribution you make for your community, your state and our nation.
I suppose, as Nicole and Deidre alluded to, I am trying to make small business the new black, Israeli couscous of the cooking world, the yogalates of the exercise fraternity. Everybody has been talking about small business and I think that is great.
It really needs to happen because that recognises and conveys respect for what you are doing. But it also shows an appreciation, almost half the private sector workforce in our country and in Western Australia is made possible by you guys.
I think that is something that we need to celebrate more of and really for me, it is about what the future needs to focus on as well. It is not going to be governments spending bucket loads of money to create a better destiny for our country, our state, and our communities.
It will be private endeavour. I mean, it has got to be private endeavour. It is going to be enterprising men and women just like all of you. So thank you most sincerely for all you do for your community.
Deidre, thank you for stalking me with issues and input. Yes, as a Cabinet Minister, I am blessed to be one of the 19 people running the country and I get an awful lot of advice from PhD’s in macroeconomics and it is fantastic.
They will be able to give you, down to the 6th decimal point, what the quarterly growth figures are today and that is helpful. But I know what really informs me most is what you are doing.
What is it that turns an idea or an ambition into action? What makes you make that decision to sort of, you know as we were talking earlier, mortgage your house or your first born to go into business?
What is it that my wife and I remember about our business that every month we are reminded of our enterprise? Half my mortgage is for our house and the other half is from our small business.
And the idea of pillow talk of cash flow – we are living the dream aren’t we? It is the greatest contraceptive ever invented; as we worked out how to try and navigate through a difficult environment where our enterprise is in the highly discretionary area of the economy.
Colin Heaney’s glassworks are world class. But you know when you are setting your Budget it is maybe not the first item you put into your ‘must buy for the month’ - but for us it was the bread and butter for our business. We did not make it, but we learnt lots and I loved every minute of it and I am reminded of it each month when I pay my mortgage.
But it underlines my admiration for all of you. You are all surviving. Maximum respect and thank you for that. The good news is, small business has turned a corner.
Many times when I have been to the west, learning and hearing about what an impact the mining resources boom has had on this state, what a spectacular blessing that is for the state of Western Australia. And it shone so brightly, many of you were telling me for a long time me it has almost blurred your vision of what else is going on in the economy.
We needed to refocus, do what we can about that strength in the Western Australian economy; look for a deeper, more diversified picture of opportunity for the great state in the West.
I have heard that message and I think Deidre you have been in the van guard of that and Nicole has been stalking me about it as well, saying you know, we have this great story of entrepreneurial people, let’s tell that story as well.
The good news is, that story is not only being told, it is actually being built upon. We are seeing jobs growth in small business in Western Australia. Half of all the new jobs created in the Western Australian economy are being created by small businesses and we want to keep that momentum going.
I suppose my job is really to work as hard for your success as all of you do. If I can do that, with the great honour of the role that I have, you know that is okay for the air I suck in. I cannot make all of your businesses succeed. That is not within my gift.
But I can do things to make it as possible as it can be for you to succeed. I suppose at the heart of my work is: get the road blocks and the headwinds out of the road. I mean, we have found when we were elected to office, the World Economic Forum ranked Australia 128th in the world in terms of compliance costs and regulatory burden on our economy.
Put it another way that is only 127 economies less gummed up than ours. We are out there competing for new markets, that outward looking pioneering spirit that is at the heart of Western Australia being internationally engaged is core business for your state and your economy.
Why put so much lead in the saddle there to make that contest to win new opportunities and new markets harder than it needs to be. It is not like the AFL, you do not get priority picks for being that far down the ladder.
Someone else just turns their thinking somewhere else and we lose that opportunity that should be ours. So that is part of our work and we have a big red tape agenda. We have about $2.5 billion of savings so far.
But there is more to do and I invite you all, either directly or through Deidre, to share with me your case studies. I need that field evidence. Then we can go hunting to find where there is things being asked of you that serve no good purpose-that just take you away from your earning.
In a policy sense, we are very alert to this as well.
I think I am getting smacked around in the media today for trying to reduce the superannuation penalty charge, if you happen to make a superannuation guarantee contribution a couple of days late.
Now, again, we want people to meet those obligations that do not create needless overreaching impositions and penalties that actually dissuade people from saying – ‘oh I think I might have made a mistake here’.
It is about right sizing the regulatory environment.
Look at the tax system; same rules, exactly the same rules for big and small businesses with some exceptions around asset write off and I will talk about those in a moment.
But the cost of you administering a tax obligation is about six times the cost per $1000 a turnover for a small business than it is for a medium size business. Same rules, but the amount of effort as a percentage of the turnover is much higher.
That is something we are focusing on. The way our regulators behave. You know, luckily our law is one thing and we are working to dial that back and I will let you in on a bit of a secret, while we are reducing that, if I come up with a great new idea that requires regulation, I have got to find offsets for it.
So the stock of regulation is not growing while we continue on our red tape reduction strategy. But it is also about the way the regulators behave. It is about cultural change and some of the key institutions that you and I deal with every day as part of it.
That is about getting the headwinds and the roadblocks out of the way. Another part of it is government getting its act together. Who said you needed to be a PhD in constitutional feng shui to work out who does what within that system of governing.
Why is it so hard? Why is it so complicated? Why are people not accessing advice and support that is there to support them, but is too hard to locate? The changes around the single business service entry point.
The Small Business and Family Enterprise Ombudsman; a concierge for problem solving and getting a small business voice happing across the bureaucracy. Things like the Export Market Development Grants program. We are right sizing it so small business can use it.
EFIC (Export Finance and Insurance Corporation). It is a great support if your traditional banker says “I don’t know what exporting to Uzbekistan looks like. I know you have a contract, I know you need finance -we know nothing about Uzbekistan.” Well EFIC is there to help.
We know that it made a $150 million facility to Rio Tinto- their balance sheet is actually better than the Commonwealth of Australia’s. What business have we got doing that? It is about supporting SME’s. So refocusing that work as well.
And you would have read, I am sure in recent days, I am getting smacked around by trying to get the competition rules right. Well, I have got this novel idea that the economy should support efficient businesses big and small.
That you should not, as a small business, be taken out just because a big business has muscle and might. Not on merit, but just because they can push you around. When did someone decide that was a good idea?
So we are trying to get that entrepreneurial ecosystem right, so that enterprising men and women have every opportunity to start an enterprise, to thrive and prosper knowing the environment will give them every opportunity to succeed.
That is what the franchising reforms are about. The unfair contract term protections that are available to consumers; we are trying to extend that to small business for consumer like transactions. That has passed the House, we have to get it through the Senate.
A food and grocery code so that that near serfdom of being a supplier with a super market chain doesn’t see you lose your marbles, your mojo and your sanity because you are getting pushed around in a way that is just unfair.
And then the last thing is about incentive and reward. That $5.5 billion package in the budget is spectacular, hard earned to get it to really target it on your interests.
Going back to where I began, it is about a catalyst for the enterprising men and women who have that idea – what can we do to get the action? To make that risk; to see the economic growth?
The instant asset write off - $20,000, new kit to build your capacity. It is not the government flashing $900 to every person to spend on a new tat or something like that. No, it is your money. You decide what you need. We will give it back to you quickly. You make that call. You make that call.
The small business company tax rate, now the lowest it has been since 1967, Sadie the cleaning lady is number one. I would say it is the lowest it has been in my life, but that is not quite right, I was born in ’66.
That is a statement. Of course we want to go further, but we have got to be able to fund it, but that is an important statement about priorities and emphasis and we have not forgotten the two thirds of small businesses that are not structured as companies.
I mean, in Canberra they say – ah small business companies are very important.
But two thirds are not structured as companies. We have got that incentive there, that 5% discount for the sole trader, the Tony’s Tradies, the people operating through partnerships and trusts.
And then our other measures, like if you find you start to do business and you get professional advice, why can’t you write that off? You consume professional advice immediately and it used to depreciate over three years.
Get your cash back when you need it. Fixing employee share schemes. What better way to align the goals of the enterprise with your team than give them a stake in the business. And for start-ups which are cash poor and needing to attract world class talent – you cannot pay all the best people enough to have Wagu S.T.E.A.K. each night.
Give them an S.T.A.K.E. and tell them to suck up the nerves and things will be better.
We are getting crowd source equity funding organised, so we have a new avenue of support. These are the things that we are trying to do. To support you having a go. To celebrate your success and encourage more people to follow in your pathway.
I often say to my political opponents, being someone’s employee is not the only way to contribute to the economy. Under the previous government, half a million jobs were lost in small business.
The number of small businesses actually employing people went backwards. But a percentage of the private sector workforce went from 52% to 43. Well it is up to 44 now. We have turned a corner. We are getting it back, we are getting on with the job.
I hope that when my work is done, we are the best place to start and grow a business. We are not there yet but we are having a red hot crack at it. Just like all of you. Just like my admiration and my commitment to work for you. Thank you very much for your time this morning.