SUBJECTS: PAYG cut for small business, First Home Owners Boost, Foreign investment
It's great to be here with Krista Pappas this morning at her business, which is a small business. You employ something like, what, 50 people, so it's a real generator of employment.
It's hard work out here in small business, and what I'm announcing today will benefit many, many small businesses right around Australia. And that will be substantial assistance from 1st July this year, which will assist the cash-flow of small businesses and also many self-funded retirees, and of course, some small superannuation funds. What we're going to do is reduce the uplift factor that applies to PAYG tax instalments that are paid on a quarterly basis. That will benefit small businesses and self-funded retirees to the tune of something like $720 million in one year. So, a very important initiative which recognises just how difficult times are out there.
As everybody's aware, we're in a global recession, and of course we've had more figures out overnight. We've seen the British economy contract by 1.6 per cent in the December quarter, and of course we've seen the US economy contract by a similar amount. We're expecting new forecasts from the OECD and the World Bank next week, and if there are substantial downgrades there, then I think it will be almost inevitable that Australia will experience a period of negative growth. That is one of the reasons why this initiative is so important, along with many of the other initiatives that the Government is taking to boost demand in the economy, and to support jobs and to support small businesses such as the one that Krista runs here.
There's some good news out today in terms of the First Home Owners Boost. There's been a substantial lift in the number of first home owners accessing that initiative that the Commonwealth put forward. Something like 42,000 people have applied for that grant since it was announced last October, and a very big lift particularly here in Queensland in terms of people accessing the First Home Owners Boost.
But it's not just what we're doing in terms of the construction industry. It's not just what we're doing in terms of this initiative to boost the cash-flow of small business. It's also what we're doing to invest directly – almost $30 billion through our stimulus package, the Nation Building and Jobs Plan, to invest directly in building facilities at schools, in building social housing, and of course energy efficiency measures.
On top of that, as you're aware, I was down at Arnott's yesterday, who are taking advantage of our 30 per cent Small Business and General Business Tax Break so they could invest in new capital equipment to bring forward that sort of investment. That's why the Government has been so decisive in putting in place these measures, because of the very sharp contraction in demand that has been imposed on this country by the global recession.
(Inaudible) your decision not to allow Oz Minerals to buy into this country, in the face of their debts which they seriously need to sell what they can sell?
Well, the Government makes no apology for applying our national interest guidelines in this particular case. National security issues are serious, and it was on the grounds of national security issues that I said to the company that the Prominent Hill site could not be included in any application. There is a balance to be struck here – a balance between foreign investment which creates jobs, and our national interest principles as well. Here the balance was in favour of national security, and I make no apology for that whatsoever.
The Opposition's raised concerns about China and China buying Australian bonds. Are they right to do that?
The Opposition is running a reds under the bed campaign, and I think they don't appreciate the need for a balance between foreign investment which supports jobs on the one hand, and national interest principles on the other. They can engage in a cheap, opportunist campaign if they like. What the Government will do is get the balance right. We do welcome foreign investment when it's in our national interest and it does create jobs, but when there are national security issues involved or issues of competition, then we will apply our national interest principles, and we do that on a case-by-base basis.
Mr Swan, (inaudible)?
Well, I have declared all of the supported travel in my declaration. I did that some time ago, and those matters have been on the public record for some years and indeed there were questions about these matters in the Parliament about a year ago. There are many who have taken supported travel in a variety of circumstances over time, and as long as that's declared, then that's the end of the matter.
Are we seeing a bit of China baiting at the moment? Kevin Rudd is anxious for China to be elevated in the IMF to have more say seen as it's bankrolling the world.
China is one of our largest trading partners, and along with many other countries, a very big investor in this country and a big supporter of growth and jobs. But as always, we always scrutinise any foreign investment application from any country – whether it's China or Japan or the United States – using our national interest criteria. We have set out specific criteria in the cases where there is investment in state-owned enterprises. We put those criteria out at the beginning of last year. In the case of Prominent Hill, we've applied our national security test because it was in the national interest, and we make no apology for that whatsoever.
But what I think the Opposition is really doing is running a cheap, opportunistic campaign, which I think could be damaging to this country's interests in the long-term. We're going to look after our long-term interests. We're going to apply our national interest principles, and in this case, national security considerations were very much to the fore. Thank you.