MICHAEL McCORMACK:
It’s going to be a sensational year for small businesses right throughout the Riverina and Central West because not only are they going to be paying a 27.5% tax rate, the lowest it’s been since 1940, they’ve also had their instant asset write-off extended by 12 months.
Capital equipment small businesses buy up to $20,000, they can just write it off instantly, no need to put it on a long depreciation schedule, they can write it off instantly. That was a great measure in the budget.
There’s also the simpler BAS. No longer do they have to fill out the really onerous form with 7 categories, now they only have to fill out 3 categories on their Business Activity Statements, and of course the Single Touch Payroll will also simplify things.
We are, as the Federal Government, looking to minimise the burden on small business in any way we can and we’ve put $300 million on the table to incentivise States, wherever and however possible, to cut through some of that red tape, to lift the burden off small business. That will help many businesses right throughout the Riverina and Central West, to get some of that bureaucracy, to get some of that red tape lifted off.
We’ve also made a huge start on it - $5.8 billion since coming into government in 2013, we’ve done that, but we want to see how much further we can go as far as lifting that red tape from small business. Because I understand, as do my colleagues, that small business is the engine room of the economy.
There are 15,000 small businesses across the Riverina and Central West, 5000 of whom are farmers. We want to make sure they have every pathway to success. So we’re lifting the red tape. We’re giving them the lowest tax rate they’ve had in nearly 80 years. We’re extending the instant asset write-off and we’re doing so much more.
I’d be very welcome to receive feedback from small businesses and that’s why I’m getting out and about in the electorate, as well as the nation, to hear from small businesses about what we can do to help them even further.
JOURNALIST:
As far as the paperwork side for them is concerned, are there any changes they’re going to have to start making from their general processes? Or is it more about simplifying?
McCORMACK:
Well the BAS is simpler; it’s now just GST on sales, GST on purchases and total sales. So there are only three categories as opposed to the seven it was previously. Single Touch Payroll, with one click, withholding tax and superannuation, all those reporting requirements for the Australian Taxation Office are done in a single touch. So that’s going to ease the burden also on small businesses. Certainly when they’re filling out their BAS, it’s much easier.
So we’re doing that. We’re also seeing what else we can do as far as red tape is concerned, because we want small businesses to get on doing what they do best; that’s servicing customers. We don’t want them to spend hours upon hours doing unnecessary paperwork. Long after they shut the doors of a night and turn off the lights and go home, we want them to spend time with their families and friends, or they can spend more time on their businesses, but business activity, not unnecessary paperwork on behalf of the Government.
JOURNALIST:
So also, while we’re talking about small businesses and electricity prices, there have been a few businesses who are saying the hike in electricity prices is affecting their bottom line figure-wise. Are there ways businesses should look at saving on electricity? What’s happening there?
McCORMACK:
Power prices are an increasing issue as we look to the next quarter. I know when small businesses get their next quarter power bill, and even further on from that, they’re going to get a shock.
It’s unfortunate that power prices are going through the roof. We are as a Government doing everything that we can. I know that my colleagues Matthew Canavan and certainly Josh Frydenberg are looking to see what they can do as far as making sure that we get the power prices down.
Long term we have a plan to revitalise and re-energise the Snowy-Hydro Scheme. We’re going to ensure that great renewable source, which is also our source of irrigation water, but that hydro-electric source is re-energised, such that it will power an additional half a million homes. That will be very beneficial for the Eastern States and in particular New South Wales, also creating thousands of jobs right here in the Riverina, but we also need to make sure that we have the right energy mix.
Labor is going down the track of unrealistic clean energy targets, unrealistic renewable targets. We need to make sure that there is a mix and that mix includes coal. I know that coal gets demonised by those that sit opposite me in Parliament. I know that many people are fearful of the fact that coal is there and is being mined, but the fact is, it is providing base-load power. The fact is it also creates thousands upon thousands of jobs in Queensland and indeed in northern New South Wales. So we need to make sure that we have that coal mix in the energy supply.
The fact that we’ve not seen any coal-fired power stations built for quite some time and yet seen a number of them close down is a concern. So as the Federal Government, we need to be able to work with the States. The States need to make sure that where possible they can extract the gas so that we can, in conjunction with the Federal Government - which has a gas reservation policy for domestic supply in cases and times of emergency – help. But we need to also see what we can do short-term, because as I say, small business are going to get a bit of a rude shock if we keep going down this path. We need to make sure we can do everything we can to force downward pressure on energy costs.
JOURNALIST:
So why the spike - just a basic reason - why are electricity prices going up?
McCORMACK:
There have been a lot of blackouts forced by the fact that we’ve had Hazelwood close in Victoria. That power station was providing coal sourced energy. We’ve also had a gas supply issue, and that is why the Federal Government will control the export of domestic gas where there is a need to ensure that we have our own gas supply here to force those prices down.
It’s a complicated issue and our Energy Resources Minister is looking very much at it at the moment to see what we can do in conjunction with the Finkel report; a report to Government not by Government. That has a number of recommendations that the Government federally is looking at to see what we can do.
It’s also an issue which has been very much in State hands for a long time. It is a State problem but now it’s a national issue.
JOURNALIST:
We might move on to HECS fees, now in this financial year the HECS threshold was lowered, what can people expect from that?
McCORMACK:
The HECS Fee has lowered, or the repayments have lowered to $42,000. You don’t actually have to pay back your HECS debt until you’re earning $42,000 a year, and then it’s at one per cent. That’s equivalent to about $8 a week. It’s the best loan a student could ever take and there’s absolutely not going to be $100,000 fees. That is just scare-mongering by Labor. That’s just unnecessary, unreliable and unwarranted scare mongering by Labor - typical Labor. The fact is that at $8 a week repayments when you reach that $42,000 threshold, it’s still the best loan a student will ever take in their life.
JOURNALIST:
For someone who’s in between that threshold but never made $55,000, yet that is now matching in the $42,000, what do they have to change? Do they have to do any paperwork or anything like this?
McCORMACK:
It’s still the best loan they’ll ever take out. The fact that they now only have to pay back one per cent rate is pretty good. I would encourage anybody who is still considering going to university, do not deter yourself from a course.
We know that anybody who goes to university on average out-earns those who don’t. But by the same token, I’ve always said that anybody who has a TAFE certificate or does a trade course, that’s worth everything as much as a university degree as well.
I’d encourage anybody who is at that age where they’re thinking of their career options, go with where your heart is. Go with where you’ve always wanted to shape and make your career, because a university degree is a pathway to success, just like a trade is.
So no matter what you’re going to do, don’t let this scare-mongering by Labor deter you from what you intended to do in the first place.
JOURNALIST:
I understand that there’s been a minimum wage increase as well this financial year?
McCORMACK:
There has. It’s a little bit over 3% on average, so that’s about $22 a week.
So that’s good. At the end of the day the Fair Work Commission sets these things, they determine these things and that’s only fair and proper that it is done at arm’s length from government. That’s good for workers who need a wage increase. Cost of living is always something that is an issue for many households and many individuals, but rest assured cost of living pressures will always be lower under a Liberal-Nationals Government than they ever will under Labor.
JOURNALIST:
Kapooka, they’ve just received funding for the satellite, how is that going to affect our community?
McCORMACK:
It’s not really going to affect our community other than the fact that they are building a satellite station at Kapooka. This just enhances Kapooka’s ability to serve the nation. It also enhances our defence capabilities. It’s a good thing that they chose to construct it at Kapooka.
Kapooka is the home of the soldier, and the fact that we have a tried service presence in our city is fantastic, because it contributes millions upon millions of dollars to our economy through the Navy, through the Airforce. If you spend any given time with the Royal Australian Airforce you do end up at Forest Hill, which is tremendous and of course Kapooka. I must say, I was very proud as the Assistant Defence Minister last year, to be able to see that $880 million was being spent in Wagga.
I made sure that funding became available for Wagga, nearly a billion dollars for our city to replace ageing infrastructure and also to increase and boost the infrastructure at both the RAAF and ARMY bases. That is the biggest single Federal Government contribution to this city in history.
The fact that our census is showing Wagga Wagga’s population is increasing, it just goes to show what a tremendous regional capital this is. Housing affordability low, the fact that people want to come and live, set up and invest, work and raise a family is tremendous for our city and this ensures that our city of Wagga Wagga, our wonderful city, can only go ahead in the future.
Thank you.