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Legislative Assembly for the ACT: 2001 Week 5 Hansard (3 May) . . Page.. 1476 ..
MR HUMPHRIES (continuing):
We have heard today about spending promises on policing. There will be more police numbers under Labor. We have heard promises to spend more on poverty, and promises to reverse what they describe as the outrageous decline in education spending. I assume they mean that they will boost education spending more than we have done. We have had promises just now on housing; that there needs to be more spent on the housing base.
Mr Moore: And Wayne did on nursing as well.
MR HUMPHRIES: I am reminded also that Mr Berry promised more money for nursing. I accept that you do not wish to outline your promises for the election campaign now. Fine. But you will have to explain how you are going to fix our supposedly wonky bottom line and how you are going to fund your promises.
Mr Speaker, if Labor at any instant in the next five months goes out into the public and says, "We are making a promise here and we will pay for it from the surplus," everything they have been saying in the last 48 hours about this budget collapses in an ignominious heap. We can treat it all as garbage. If they do not believe, as they say here, that our surplus is sustainable, they cannot in all conscience promise to spend a single cent of it in their own coming election campaign. Let us see what they do in the next five months.
Mr Speaker, I have already commented on the question of cash reserves. Mr Stanhope attacks the proposition that we should increase the payroll tax threshold. He says this is a bad thing. He made a fairly extraordinary statement. He said, "What good is that to small business? You are better off cutting the rate of payroll tax for small business." Well, Mr Speaker, the answer to that is no. Mr Stanhope has got that absolutely wrong.
If you cut the payroll tax from, say, 7 per cent to 6.5 per cent across the board, then everybody gets a half a percent break, and that is all they get. Big business, small business, everyone gets a half a percent break. If you raise the payroll tax threshold then every small business in the territory, without exception-and by definition they are small businesses if they are under the threshold-gets to be freed entirely of payroll tax.
If you want to claim that it is bad to erode the payroll tax base, that is fine; go right ahead, but do not claim that it is better for small business to reduce the payroll tax rate as opposed to raising the threshold, because it is not. Confirmation of that comes from Deloitte Touche Tohmatsu which just a couple of weeks ago issued a national report on payroll tax regimes, and I quote:
The ACT is the only state or territory to raise its payroll tax threshold enough to help increase small business employment, a study by business consultant Deloitte Touche Tohmatsu has found.
They said that we had the best regime for payroll tax in Australia.
Mr Moore: And what is the unemployment level?
MR HUMPHRIES
: Our unemployment rate is reflective of that fact. Small business is a big soaker-up of unemployed people in this community. That is where future job growth lies. Mr Speaker, that is why we have invested in the vitality of small business. Labor's promise, which I think is what we should take it to be, to reduce the payroll tax
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