Another Australian business success story. What Daniel Zovko and his partners have done here is created a great business, a great Canberra business that is thriving. Its growing, it’s got 33 employees, 10 contractors and they are going to be direct beneficiaries of the tax cuts that we have secured through the Senate last week. That means the owners will have more money to invest in their business. They have been investing everything they’ve made. This is their business. They have created this. They’ve provided these jobs and we’re backing them. They will have access to the instant asset write-off now as a company with a turnover of less than $10 million. We have raised that threshold from $2 to $10 (million) and of course they will benefit this year from the reduction in company tax for a business, for this business from 30 per cent to 27.5 per cent. And as they grow, hopefully to $25 million next year, if they do that, they will still get the 2.5 per cent tax relief, and then $50 million the following year.
This is what our tax cuts are all about. They are backing Australian businesses. This is a tangible way for Australian businesses, small and medium businesses to be supported, to have the money that enables them to invest in their business and in hiring more employees, bringing more Australians in to work here, that’s the drive, that’s the incentive that we’re providing.
This is all about jobs, it’s all about economic growth. It is the best way that we can ensure that they have the incentive to invest and to employ.
And as the Treasurer will no doubt say more about, the big question now is what is Labor going to do? Is Labor going to go to the next election and say to Daniel Zovko and his partners, and hundreds of thousands of other Australian businesses, we’re going to jack up your taxes? We’re going to penalise you for your hard work and your success? That’s the test now on Mr Shorten. Is Labor going to amp up and accelerate its war against business?
Thank you Prime Minister, it’s great to be here with the Prime Minister today and Daniel and his partners and the 33 employees, Australian employees who are here working in this business who are part of its success. Those 33 employees are part of 6.5 million employees across the country who are in businesses that will benefit from the tax changes we were able to secure last week.
Some 3.2 million businesses, 6.5 million employees, that’s more than half the labour force in Australia is in businesses that will benefit from these tax changes.
And what we’ve seen in this business, is the business grow from $900,000 to $9 million in turn over and they’re shooting to be bigger than $10 million.
Yesterday I was in a business in Peakhurst, there are just under $2 million and they want to be over $2 million and they also benefit from the tax cuts that we’ve been able to achieve.
And what you see in this business and in smaller businesses than this and larger businesses than this, is you see businesses constantly backing themselves by reinvesting. That’s what the tax cuts do. That is the practical tangible demonstration of what these tax cuts do.
Now as the Prime Minister has rightly said, last week in the Parliament, the Labor Party, Bill Shorten, Chris Bowen, all the Labor Party members voted against a tax cut for this business. They voted against a tax cut for businesses all around the country. And they need to say right now are they going to hold to that position? Because if they are not going to hold to that position then they should be upfront with businesses like Dan’s here and then they should be upfront about how they're going to pay for the $4.3 billion that that is a cost to their own forward estimates. And so they have a lot of explaining to do. They've either got to tell Dan and the 33 employees who work here that they're going to put their taxes up or they need to explain just now how they are going to afford the promises they're putting out there.
I mean 80 per cent of Labor's schools policy is unfunded, unfunded by continuing on with the tax cuts that we've been able to secure.
So that's Labor's problem. They need to explain it. But for the business here, for Dan and his employees in particularly, they are the beneficiaries of this Government getting things done.
Can I just say before we go onto questions, can I say that the thoughts and prayers of all Australians are with the families of those whose lives have been lost in the floods following Tropical Cyclone Debbie and we share the anxiety and concern of those who have loved ones that are missing in the floods.
This has been a natural disaster that has spread the length and breadth of the east coast of Australia. Nature has flung her worst at Australians, which brought out the best. The solidarity, the cooperation - I've seen it myself yesterday and last week - Australians pulling together, Australian Defence Forces, emergency services, police and the community and all levels of government working together to clean up, repair the damage and get back on their feet.
But it's a tough time for those communities and of course in Rockhampton in particular, the peak of the flood is yet to come. They'll see that tomorrow. And our thoughts and prayers are with the people of Rockhampton and there is considerable resources going into ensuring that so far as possible, the consequences of that flood there are mitigated.
But I just want to emphasise one very, very important point. Do not go into flooded waters. Don't try to drive through them or swim through them or walk through them. If it's flooded, forget it. Even in areas where the flood waters have subsided, there will still be flooded roads, flooded crossings. Don't venture into them. Follow scrupulously the advice of the authorities. They know how to manage the situation, if you take their advice, you and your family will be safe.
Prime Minister, you talk about jobs and growth. Do we yet know what the tax cuts passed last Friday will mean? How many jobs will be created? Or how much growth dividend will add to the economy?
It will add substantial economic growth. It's a real stimulus.
I know that the Labor Party must be in a parallel universe, it's not surprising, most of them have never, vast majority of them have never worked in the private sector let alone started a business like Daniel Zovko has.
Let me tell you back in the real world where most Australians live, they know that if you increase business taxes, you'll get less business. If you increase taxes on investment, you'll get less investment. If you lower business taxes, you leave more for the owners to reinvest. How do you think this has been built? This has been built because these guys have worked hard, they've saved, they've made some money and they've ploughed it back into the business again and again. That's what small business does.
So frankly the enterprise of Australia, the jobs of Australians, 87 per cent of Australian jobs are in the private sector. And the idea that the Labor Party has, the Labor Party seems to think that you can keep on increasing taxes and people will keep on investing and people will keep on employing. They are kidding themselves. They're not dreaming, they're having a nightmare. That is a Labor economic nightmare for everybody else. They don't understand business. They don't understand enterprise. They don't understand the spirit, the spirit of investment, the spirit of growth. That's what motivates these people. That's why there are 33 people working here as employees and 10 contractors, because Daniel and his partners had the vision and the confidence to invest and we're backing them.
Speaking of tax, Prime Minister, how taxing is it that you have the former Prime Minister every time the Government has a win, speaking out. This time he's spoken out about the horse-trading to get this deal through. Surely that's irking you to some degree?
We stand by our record on the Senate. Just think about what we've been able to do since the election. So just since the election, not so long ago, nine months ago or so - we've secured the passage of the Australian Building and Construction Commission legislation, which we had been unable to get through in the previous parliament. The Registered Organisations Bill, together those two laws have restored the rule of law to the industrial workplace. They've restored the rule of law in particular to the construction sector.
We brought in the biggest reforms to child care in a generation. Massive reforms making it fairer, more available, benefitting overwhelmingly people on lower and middle incomes. A massive reform, again, that couldn't be got through the previous parliament.
In addition to that, we've now succeeded in reducing personal income tax. Scott Morrison didn't try to put up personal income tax. He didn't put up personal income tax. He, as a treasurer, reduced it through the Senate and we've now succeeded in securing as you know - and that's why we're here today - tax cuts for businesses up to turnovers of $50 million, employing, as Scott said, more than half of the Australian workforce.
So that's what we're doing. We're getting stuff through the Senate. We're delivering, we're governing, we're proving that if you're prepared to negotiate, you can get things done in the 45th Parliament.
And that’s what the Abbott government couldn’t do – is that what you’re saying?
You run the commentary, I’ll deliver on Government.
But given you’re asking about achievements – more than, around $25 billion worth of budget improvement measures implemented since the last election. Almost $25 billion. Now, that was a hard chore in the last parliament and we’ve been able to get savings implemented as a Government since the election that had previously alluded us by taking the approach we have which is to focus on getting the outcome. The Australian people want their governments to get the results and the Turnbull Government is getting the results.
On the company tax cuts – so far no one in your Government will give specific figures about the benefits to the economy. Why is that? Have you done the modelling or is it just not there? Why won’t you give us specific figures?
The Government doesn’t need to be convinced about the need to give small and medium sized businesses a tax cut. The Labor Party needs to be convinced about that.
No, I’m sorry – I’m asking you.
That is why the Labor Party is putting this issue around the gallery now for the last week, they’re putting it out there – ‘Oh you need to know what the econometric model is’.
I tell you what, if you go down the pub and you talk to small business people, they’re not talking about econometric models. What they’re talking about is how they’re going to grow their businesses. If they’re a tradie, if they’re Dan and the team here, I’ve referred to the chocolatier out in Penrith, there is the real estate agency up in Brisbane, there is the tool making business in Adelaide – they’re not looking for econometric models. They’re looking for governments to take action, cut their taxes, give them access to the instant asset write off.
This Government, the Turnbull Government understands how business works. We focus on the things that we know makes a difference because our life’s experience, our background in businesses, particularly the Prime Minister but so many in our team, we know that is the right thing to do.
So I ask you this question – the Labor Party thought it was a good idea, they were prepared to vote for a tax cut for businesses up to $2 million, so they obviously know that if you cut taxes for businesses, it is a good thing. Now we believe that should be extended right across the economy and we’ve been able to secure tax cuts for businesses up to $50 million. We don’t need to be convinced of the merits of that policy, the Labor Party does so I suggest you ask them.
It is not about the opposition though, I am sorry Treasurer, it is about providing some evidence for us. If you’re saying -
Our modelling was done on the entire tax package and that is what we’re committed to. It lifts the GDP of the country by 1 per cent permanently.
But you’ve only passed it up to $50 million -
That’s what the modelling produces and we remain committed to the whole plan. The only people who want to stick with the current legislated savings and not even that it would seem is the Labor Party. So we’re committed to the entire package and our modelling is based on the entire package.
Just back on the Senate – Tony Abbott said that you shouldn’t make the wrong deals just to get something right through. Do you think that you’ve been making the right deals?
Absolutely, of course we have. And we’ve been delivering. The results are there.
Ultimately the Australian people elected the 45th Parliament, every single one of them, members and senators, and they expect us to get on with the job. Now we have to secure the passage of legislation through the Senate – we need the support of the crossbench if Labor and the Greens oppose us.
We’ve been successful in that and what we’ve demonstrated is that we can achieve the passage of our agenda through the Senate. And as Scott and I have both noted, we have now secured against all the critics, there were some people that said we wouldn’t be able to govern after the election, right, many in the press gallery, wise commentators said that.
Both of the double dissolution bills are now law.
Our tax cuts, personal income tax passed.
Child care reforms passed.
All of the business tax cuts that were set to be delivered in this term of Parliament are now passed.
So what we’re demonstrating is that we know how to govern, we know how to deliver, we are delivering on our promises. That’s what the public want us to do. It’s what they’re entitled to expect and we are doing it for them.
Can I ask about the PaTH Programme?
Sorry – the PaTH Programme?
It needs a piece of legislation that is yet to pass the senate – will you roll out that program without it yet passing? And what tax implications will that have for those in the program?
We are very confident of being able to take this through the Senate based on our record of getting things through the Senate.
I think it is very disappointing that once again the Labor Party have been working against trying to get young unemployed people into jobs.
I mean, I was at a business yesterday, they have a turnover of between $1-$2 million, they are going to take on someone as part of this PaTH Programme and they’re going to hopefully give that young person an apprenticeship at the end of going through that PaTH Programme. Now getting young unemployed people, particularly people who have been unemployed for a while into jobs is what I thought would actually unite the Parliament.
And the fact that the Labor Party is working against getting young unemployed people through this very innovative program which small business in particular want to embrace – small businesses want to give people a go.
This business here has a number of apprenticeships already. They’re the biggest employer, we understand, of stonemasons apprentices in the country. Now, they’re a business that wants to give people a go. So many businesses want to give young people a go and the PaTH Programme ensures that they can do that in a much more positive way for that business without taking on many of the risks that they currently would have to do which prevents them from giving young people a go.
So my message to the Labor Party is put that stop stop sign away. It’s got stop on both sides. Whether it is trying to get businesses growing, whether it is trying to get young people into work, they are constantly saying ‘stop, stop, stop’ and that is no way to grow an economy.
I mean if you had an electron microscope, you could not find Labor’s growth plan because it does not exist.
Prime Minister, would you like to make any comments on what happened in St Petersburg overnight?
Yes, thank you.
We condemn utterly the attack on the St Petersburg metro overnight.
This is a reminder that the threat of terrorism is a thoroughly global one. And indeed, as the President of Afghanistan and I were reflecting on this last night also in our meetings.
So we send our thoughts and prayers, our condolences to the families of the victims of the attack in St Petersburg. At this stage we are not aware of whether any Australians were involved, our Embassy is making its inquiries urgently to ascertain that. Obviously many Australians will have friends and family in Russia at the moment they should seek to contact them. If they can’t contact them they can contact the Department of Foreign Affairs and Trade hotline.
Also please pay close attention to the travel advisory for Russia and St Petersburg as it is being updated on the DFAT traveller website.
But this is a reminder as I said that terrorism is a global threat to all nations, who need to work together to combat it everywhere in the world. This is a growing threat of terrorism and whatever other differences we may have between nations we have a common interest in stopping this terrorist menace.
Prime Minister, can I ask about the President of Afghanistan, just quickly sorry, your meeting with him last night, did you make any commitment to extra resources for Afghanistan?
Well we, I advised him that we have decided and this was decided some time ago to extend our, continue our military commitment through for another year, through to 2018 and he’s very appreciative of that. As you heard his remarks, he paid tribute to the 42 Australians that have paid the supreme sacrifice in Afghanistan. He thanked the Australian people and he thanked, acknowledged in particular the 18,500 Australians who have served in that very long war. But we are a substantial contributor to the defence and support of Afghanistan both through our 270 military personnel who are there at present, mostly at the Officer Academy, the Afghan National Army Officer Academy in Kabul which I visited and also of course in other capacities as well. But also we are a substantial aid donor through AusAID but also we make a substantial contribution to their defence budget.
So we are very strong partners and President Ghani is very grateful for that and he’s acknowledged that.
And we also in return acknowledge his leadership and the way he is fighting to restore peace to Afghanistan but also the way in which he is ensuring that the Government empowers women and girls, ensuring that it is transparent, that he stamps out corruption, that its more accountable. He has many challenges but I believe, as we know, Australia and our allies are absolutely committed to supporting the efforts to restore peace and develop a prosperous future for the people of Afghanistan.