Bruce Billson is the Small Business Minister and is set to crow a small business tax cut, but what else does he want and what might he get?
Bruce thanks for joining us.
Peter, always great to be with you and your viewers.
Ok mate can I admit to it? Was there a lot of air punching and jumping around the office when those job numbers came out today?
A positive sign. To see that strength in the numbers – 37,700 new jobs, 31,500 of which are full-time. Really not a great surprise.
I know the market thought it would be about half of what it turned out, but if we look at the ANZ job series that has been nine out of the last 10 months pointing up 6.6% compared to last year.
It is a fairly consistent pattern and really it reflects some of what I am hearing in the market place – green shoots, optimism, positivity and that is where our work seeks to support enterprising men and women who are the job creators in getting those settings right to encourage more employment and more economic activity.
That is exactly what I have been pointing to, those ANZ job ads, they have worked in the past. They can be a bit slow to come through in the real world but that is what happens with forward indicators.
That is right. There is usually a lag on them materialising.
But you look at other indicators Peter: We have got consumer spending which is quite buoyant at the moment against a lot of the commentary.
We have seen some of the household savings numbers come off slightly, so more of that household income is going into consumption.
We have got really strong numbers: 14% up year on year on building approvals starts.
Export volumes are up.
I have just come back from some rural communities in northern New South Wales and they are pointing to agricultural commodity prices being a reason for a skip in their step.
And even in the visitor industry, the Gold Coast and the like are talking about good occupancy numbers. A bit of yield as well, they are actually making a bit of margin which is something that they are welcoming.
So there are these green shoots. You know me, I am perpetually optimistic and there is good reason for us to be so.
Yes and I like optimistic politicians mate.
Business confidence and consumer confidence – I must admit you, like me, you will not just see a really decent turn around both those indicators, you have not got them yet and it reminds me of the old days when Amanda Vanstone was the Labor Minister and she was praying for an improvement in unemployment, and she said I felt like an old fart waiting for the drought to break and the rain to fall.
We need to see business confidence and consumer confidence come back do we not?
Yes and I do not want to trip you on your introduction but you were a bit melancholy on where the numbers actually are.
They are either at or above long-term areas. They are substantially above where they were under the previous Labor Government.
Where they have changed was that those confidence figures almost reflected a national jubilation that there was a change of government.
They went up spectacularly high in the lead up to the last election and were there for a little while and then there was a little bit of an adjustment, a reality check and we know we have had some character building times in getting our Economic Action Strategy implemented.
They have come off from a very high peak which followed them being quite melancholy under Labor. So I would not read too much into the fact that they are at or above longer term trend averages, but we need to do more because we know there is capacity in the economy.
We know there are some balance sheets that are pretty strong.
There is cash out there, but we need that confidence so that people will take that next step, make that investment and make that next recruitment decision and look for new innovation and economic opportunities but I do not think it is quite as melancholy as your intro might have suggested.
Bruce I always like to agree with you but on this one we are going to have to have a slight disagreement. I agree that when you guys won business and consumer confidence spiked without a doubt.
It took off.
But it did come off the boil. That is why I want to ask this question of you.
Are your colleagues in Treasury going to make it easy for you to keep telling this great positive story? Because we need a pro-growth Budget, we need a pro-jobs Budget and the last one, even if you want to blame the Senate – remember those ferals in the Senate – if you want to blame them for not getting the Budget through, the reality is it was a significant time point where confidence came off the boil.
So we need a good Budget that builds confidence. Do you expect to see it come the second Tuesday in May?
Yes I do. I agree with your summation of the last Budget: we bit off too much. We were trying to do too many things too soon and frankly there were too many moving parts and too many opportunities for people who wanted to be critical of the Government to find bits of what we were doing to have a crack at.
Labor was running around saying people's pensions were going to be cut. No one's pensions have been cut. They have been going up twice yearly since the Government was elected. It was a question about longer term adjustments to indexation.
We aimed to not burn off the green shoots at that time by not doing too much too soon, but the structural changes that were in the Budget – too many moving parts biting off too much.
We need to stay the course though to get Budget repair progressed and we have made good progress to date.
We have not gotten everything that we have wanted, but we need also to get that positivity out there -so that enterprising people, particularly, know the entrepreneurial ecosystem in our economy is right and supporting of them so they can go that next growth step, they can make that next recruitment decision and know that the ground is solid on which they are making those investments and the risks that they are taking are not being added to by uncertainty and moving parts at a policy level.
The big news out of the Budget has already been heralded by the Prime Minister and the Treasurer – there will be a small business tax cut. But is it going to be only restricted to small businesses that are a company or will there be a way in which all small businesses will be able to benefit from the cut?
I know the Switzer program breaks big news and I am not going to announce the Budget package tonight but you and I have spoken over many years and you and I both know that only a third of Australian small businesses are incorporated and I am not blind to the two thirds that are not incorporated.
Of course that has been a focus of my advocacy and our policy development work as we look at other ways of putting reward and incentive there for our risk takers, our wealth creators and to say profit is a good thing.
Without profitable businesses, we do not have viable entities that can recruit people and provide the livelihoods that we need.
It is also about encouraging innovation and entrepreneurship so that investment in new kit, in new capacity, in new technology – we want to get behind that as well.
And then the other thing too Peter is our ongoing work on red tape reduction. Some of that involves a spend to get government systems talking to each other, to remove some of those compliance obstacles that drive small businesses and family enterprises insane.
They are the big three themes that we are focused on: reward and incentive, encouragement for innovation and entrepreneurship and continuing on our work to get compliance burdens off the back of small business' so they can focus on growing their business, not doing the business that governments require of them.
Ok Bruce well I hope after the Budget we will have a great story to tell and we will be predicting strong growth for the Aussie economy. Thanks for joining us.
Great to be with you and your viewers Peter.