Welcome one and all, James welcome to ACCI – the Australian Chamber of Commerce and Industry.
Now I’m here with Michael McCormack, the Minister for Small Business and as you know our focus, our commitment is to ensure that we create the right environment for you to succeed and for you to be able to invest and grow your businesses. Because we know that investment brings jobs.
Now I’m sure you’ll recall that from time to time during the election campaign, which of course was quite a long one, I used to say ‘jobs and growth’ was our objective.
Well it’s not just a slogan, it’s an outcome. Business conditions according the NAB are at an all-time high, right now, and as we know, 356,000 new jobs have been created in the last year and about 84 per cent of them are full-time.
Now that is a mark of the success, the economic leadership we’ve provided. It is a mark of the effectiveness of our commitment to reduce business taxes on small and medium companies - as you know up to $50 million turnover - we’ve achieved that through the Senate.
$50 million turnover businesses is not a huge business, but businesses that turnover $50 million a year or less, employ half of the entire private sector workforce, so it’s a lot of Australians. So it’s the big end of town, which is very important, but half of Australians are working for businesses that turnover $50 million or less.
Now as Michael and I and like so many of our colleagues come from a business background, and we know that cash flow is king. Cash is what it’s all about, and you need to make sure that your bills are paid on time, that your customers are paying you on time.
So today we have announced the government will mandate that by July 2019, all non-corporate Commonwealth entities must pay all invoices for contracts, up to a total value of a million dollars within 20 calendar days - which is more or less 15 business days.
That will mean that around 95 per cent of invoices are paid in 20 calendar days, and that is a huge win for the nearly 7,000 Australian small businesses that work with the Commonwealth each year.
Now we’ve already cut $5.8 billion in red tape. We’ve put $300 million on the table to encourage the states to partner with us. To further cut red tape for small business, because as you know, much of it, if not most of it is at the level of state government and indeed local government.
Now I want to just touch on trade, you know we have seen with the big free trade deals that we’ve opened up, China, Korea, Japan and more – Peru just signed just the other day in Da Nang in Vietnam – and of course we are still working away on the TPP.
We’re seeing enormous opportunities for Australian businesses, small and medium businesses, family businesses – often mum and dad businesses - micro businesses. And that of course is because of the power of the internet. The ability to get into these markets that previously, you would always have to deal with one of the big guys to be able to access, and that’s absolutely changing that opportunity.
I want to touch now on energy, you know vitally important for every business. For some businesses it’s the largest single overhead item.
Now what we have done is, right across the board, is every lever of government to reduce energy prices. We’ve got the retailers in and urged them and persuaded them to go out to their customers and tell them that they’re on the wrong plan, to get onto the right plan. Families, small businesses are getting savings of hundreds of dollars a year.
We’ve had a gas shortage in eastern Australia. It beggars belief that we ever did given how much gas Australia produces and exports but again, it was a failure of the Labor Party. You had a Labor government federally, Labor government in Queensland – I’m not trying to make a specially partisan point but it’s just a historical fact - and they allowed exports of gas from the east coast without paying any attention to protecting the domestic market.
So we’ve got to the point where we were foreshadowing restrictions on gas exports – an unlikely course of action for a Liberal Government you would think, but we needed to protect Australian jobs, we needed to protect the jobs you provide and the businesses you lead.
The good news is the energy companies, the gas companies came to the table, we’ve reached agreement with them – we now have enough gas into the east coast market and you’ve seen wholesale prices coming down.
But I want to talk about what the modelling that’s come out today on the National Energy Guarantee and this is a critically important next step.
For the first time, it will end the subsidies, end the picking winners in terms of technology and ensure that we have a market instrument that requires retailers to have the necessary levels of despatchable or reliable or baseload power – call it what you will – and of course meet the emission reduction obligations that we’ve signed up to globally as our obligations to meet.
This came from the Energy Security Board. We’ve spent a lot of time working with them, it’s their submission, these are the experts in the field. And they went out to seek independent modelling to confirm or not whether their assessment was right.
Let me give you a couple of numbers – what this will result in, the National Energy Guarantee, if it is accepted later in the week by the states and the territories - it will lead to significant falls in residential and business electricity bills. Up to $400 for households compared to 2017 prices, as of now.
And of course, it will keep the lights on, so it will be more affordable, and more reliable.
For high energy using households, such as a four-person family in New South Wales with a pool, could save around $170 a year, after 2020, compared to business as usual.
A large energy user such as a chemical factory can save about $1.4 million a year.
A café in regional Queensland would save about $230 a year, versus business as usual.
A dairy farm in Gippsland could save about $1,120 a year compared to business as usual.
A supermarket in South Australia can save about $445,000 a year compared to business as usual.
And according to the Energy Security Board – this is their words, not mine or Josh Frydenberg’s – they’ve said: “The modelling results show that the Guarantee meets the policy objectives of reducing emissions while retaining a reliable system and improving affordability.”
So the evidence is in. The National Energy Guarantee will deliver, generate significant savings for Australian families and businesses. The savings are in fact greater than have been originally estimated by the Energy Security Board.
So our plan, the Coalition’s policies on Energy, together with what we’ve done on tax and what we will do in the future, puts more money into the pockets of Australian families and businesses.
Our plan will cut power bills and keep the lights on. Keep the lights on, very important. Those from South Australia will understand the significance of that perhaps more than others, a keen awareness of the challenges of reliability or lack of it.
Keep the lights on and put Australian families and businesses in a position to be able to afford to keep the lights on.
So we’ve had widespread support, I have to say, Josh Frydenberg is a very powerful advocate. There was a joint statement put out last night supporting the National Energy Guarantee, by groups as diverse as AI Group, the Australian Energy Council, the Clean Energy Council, the ACTU, ACOSS, the National Farmer’s Federation and the peak steel, cement and aluminium lobbies.
So this new modelling is a wake-up call to Labor and the states. It’s time for them to get on board and work with us to help households and businesses. Because we know, as you know, that it is your enterprise, your entrepreneurship your preparedness to have a go - and if it doesn’t work out, dust yourselves off and have another go – that delivers and is delivering right now, the jobs and growth Australia needs.
So it’s great for Michael and I to be here with you today, we’re looking forward to having a very good discussion.