Page 4074 - Week 13 - Thursday, 10 November 1994
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Over the past few years, Madam Speaker, bankruptcies in the ACT have been trending downwards. Since June 1990 bankruptcies in the ACT have decreased by 8 per cent, while for Australia they have increased by 32 per cent. Private sector labour costs in the ACT are the lowest of any State or Territory. A recent report from the ABS, that for 1991-92, showed that, compared to the ACT, private sector labour costs were some 18 per cent higher in New South Wales and 10 per cent higher for Australia overall. Mr Deputy Speaker, the outlook for the ACT economy continues to be firm. The ACT's GSP is expected to grow by 4.5 per cent in real terms in 1994-95. Employment is forecast to increase by 3 per cent in 1994-95, compared with 2.5 per cent in 1993-94.
Mr Deputy Speaker, despite these impressive figures, as the Government we continue to respond to areas that might make ACT businesses uncompetitive with their interstate counterparts. For example, we moved very quickly to align the payroll tax thresholds to those of New South Wales when they were changed earlier this year. Payroll tax is not a tax that a great many small businesses pay. Mr Stevenson's MPI refers in particular to small businesses, but the threshold for the payment of payroll tax is a payroll of over half a million dollars a year. That would give you at least 10, possibly 20, employees. Most businesses of that size in the ACT would probably be classed more as medium sized. The small businesses in the Territory, for the most part, do not pay payroll tax. In fact, the last figures that I looked at indicated that about 13 per cent of businesses in Canberra paid payroll tax. The vast majority of them do not. Nevertheless, as I say, we moved very quickly to align the threshold to that of New South Wales when that was changed earlier this year.
We have introduced also the code of practice for retail and commercial tenancies. I did not hear Mr Stevenson mention that, but it is a fact that the Government has recognised the need to look after the interests of small businesses as tenants. The retail and commercial tenancies code of practice is designed to ensure that they are not disadvantaged by ruthless landlords or by extremely large increases in their rents which cannot be justified. We have also developed an ACT government purchasing policy in consultation with business. We have done that in order to maximise the benefits to local and regional businesses that can flow from government purchasing. There are many other forms of business support that have been undertaken by the Government. The Business Services Centre just across the square outside is an example of that. It enjoys enormous patronage from local businesses and from people considering going into business or seeking to go into business. The work that it does, I believe, is of enormous assistance to small business people in the Territory.
As the Government, we will continue to liaise with business organisations to monitor the impact of any identified impediments. However, it is worth drawing to the attention of members the main conclusion of the McKinsey report - the importance of not red tape and taxes but, in fact, regional leadership in the development of small businesses. First and foremost are the commitment, the energy and the attitudes of the leaders of local businesses. A region's No. 1 lever for encouraging growth is its existing people and businesses. The extent to which businesses are outward looking, energetic and committed to growth will be critical to achieving investment growth.
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