ADDRESS TO THE AUSTRALIAN HAIRDRESSING COUNCIL ANNUAL CONFERENCE

8 Jun 2018

ADDRESS TO THE AUSTRALIAN HAIRDRESSING COUNCIL ANNUAL CONFERENCE

SENATOR THE HON DOUG CAMERON
SHADOW MINISTER FOR HOUSING AND HOMELESSNESS
SHADOW MINISTER FOR SKILLS, TAFE AND APPRENTICESHIPS
SENATOR FOR NEW SOUTH WALES

AUSTRALIAN HAIRDRESSING COUNCIL ANNUAL CONFERENCE

COLLINGWOOD

FRIDAY, 8 JUNE 2018

*** CHECK AGAINST DELIVERY ***

I acknowledge the traditional owners of the land and pay my respects to their elders past and present.

Thank you to Sandy, Clint, Wendy, and the Board of the Australian Hairdressing Council for the invitation to speak with you this morning.

Given where we now are in the electoral cycle I think it would be an appropriate time for me to outline our economic priorities, some of Labor’s small business policies and of course our Vocational Education and Training policies.

As you are aware I am a strong supporter of the apprenticeship system.

It was through an apprenticeship and the equivalent of the TAFE system in Scotland that I had the opportunity to attain a skilled trade and immigrate with my wife and daughter to Australia.

I know from first-hand experience just how transformative a skills education can be, and I will return to the challenges and opportunities we face in that sector shortly.

But firstly, I would like to canvass the wider economic picture.

Labor is acutely aware of the importance of fostering a strong economic environment for small and medium businesses, such as those represented in this room, and the contribution of these businesses to our national prosperity.

Without a profitable and productive business sector, coupled with a skilled workforce enjoying growing disposable income, we simply won’t have the necessary conditions for our small businesses to succeed.

That’s why Labor and Bill Shorten are committed to a delivering a strong economy and a skilled workforce.

While we acknowledge having a strong economy is important, it’s equally important to us that the benefits flow through fairly to society.

That is why Labor is determined our economic agenda must help sustainably grow the economy while building a more just and egalitarian society.

Our priorities in health, education, infrastructure, skills and housing are focused on middle-class and working-class Australians – and not just the big end of town.

A big business tax cut of $80 billion, with $17 billion going to the banks is not one of our priorities.

That’s because unlike the Turnbull Government, we don’t blindly believe that handing over $80 billion to foreign multinationals and the big banks will assist with the task of budget repair, or help us build a fairer society.

Trickle-down economics has not, and will not work.

Troublingly, the Turnbull Government appears completely wedded to the failed model of trickle-down economics its corporate tax cuts represent.

They have repeatedly declared that their tax plan is the sum-total of their economic agenda.

This is despite analysis by their own Treasury Department that demonstrates that this ‘plan’ will fail in three fundamental ways as an economic strategy.

  • It will not contribute to sustainably growing our economy; with Treasury estimating it will only increase GDP by 1.2 per cent over 20 years.

 

  • It will not deliver meaningful wage growth to the millions of Australians enduring the lowest levels of income growth in decades. 

 

  • And it will deprive the federal Government of future capacity to invest in and fund vital services.

 

The key beneficiaries will not be the Australian community, but foreign shareholders of multinational firms that operate in Australia.

This is typical of the Abbott/Turnbull government, which has lurched from one economic policy failure to another throughout its nearly five years in office.

It all began with the 2014 austerity budget attacking working families and the most vulnerable in our society.

When the Australian public in their wisdom rejected that assault on the very notion of the fair go – the Coalition was left desperately searching for a new economic strategy.

It came as a thought bubble –masquerading as economic policy – from Malcolm Turnbull, with a plan to increase the GST.  An initiative that would place increased financial pressure on low income Australians.

Thankfully, this proposal was hastily abandoned – and the next thought bubble was to hand taxing powers to the states.

When this idea was dispatched in almost equally record speed, it became all about “innovation” – which much like the Prime Minister turned out to be all slogan and no substance

Finally, when sloganeering about innovation didn’t work the Government reverted to its tired and discredited trickle-down economics playbook.

$80 billion of tax cuts for big business, multinational corporations and the banks in the vain hope that this would kick start the economy and workers would get wage increases.

The Government has also run a concerted campaign against penalty rates.

In doing so, they have failed to protect some of the lowest paid workers from real cuts in take home pay – including I must add, some of the nearly 89,000 people employed in Australia as hairdressers and beauty therapists.

Not only have the Government pursued terribly misguided policies, they have also opposed sensible and measured reforms.

For example, they’ve stubbornly opposed Labor’s proposed changes to negative gearing and capital gains tax that would save the budget  $32 billion over 10 years, and give young homeowners the opportunity to buy a house without taxpayer subsidised investors outbidding them.

If you are already accessing negative gearing and capital gains tax concessions they will remain.

In future, negative gearing and capital gains tax concessions will only be available for new builds that add to housing stock.

In contrast to the Government, Labor has had a consistent economic agenda.

We have been releasing our proposals throughout the parliamentary term – fully costed and open to public scrutiny.

This has included making a number of hard choices on repairing the budget.

These economic reforms will put us in a much stronger position over the coming decade. These reforms include:

  • Better targeting negative gearing and reducing the capital gains tax discount from 50% to 25% - saving $32.1 billion over the decade.
  • Closing multinational tax loopholes – saving $5.4 billion over the decade.
  • Capping deductions for managing tax affairs at $3000 – saving $1.3 billion over the medium term.
  • Introducing a standard maximum 30% tax rate for discretionary trust distributions to mature beneficiaries – saving $17.2 billion over the medium term.
  • Ending unsustainable tax refunds through dividend imputation for people who currently pay no income tax while protecting pensioners and charities.

 

Importantly, these reforms allow us to pay down national debt faster.

This will enable us to prioritise policies aimed at boosting income growth, alongside stronger investments in our educational, environmental and human capital. 

In a broader sense, this is because Labor recognises that countries with records of strong and inclusive economic growth do share something in common – and it’s not a rock bottom corporate tax rate.

It’s that they invest in the necessary infrastructure to allow their people and firms to be more productive and compete in the marketplace.

They support and incentivise investments in research and development that lead to innovative new products and businesses.

They understand the value of funding an education system that provides world-class skills through higher education and vocational training.

A Labor government will also deliver bigger, better and fairer tax cuts for 10 million working Australians.

These Australians are your clients.

Providing tax relief for families is a far more important economic priority for us than an $80 billion tax giveaway to big business and the banks.

Under Labor’s plan, everyone earning less than $125,000 a year will receive a bigger tax cut compared to the Liberals.

More than 4 million people will be better off by $398 a year compared to the Liberals.

A teacher earning $65,000 will receive a tax cut of $928 a year.

A couple earning $90,000 and $50,000 respectively will receive a tax cut of $1855 a year. Labor’s plan recognises that low and middle income households are more likely to spend any additional income they receive.

Our targeted tax cuts will put more money back in the hands of Australian families who’ll support future growth.

This will provide a much stronger foundation for demand than the Government’s poorly targeted proposals that overwhelmingly favour those on high incomes.

Ultimately, this means more money in the pockets of consumers that purchase your products and services.

Labor has a proud record in supporting a strong and vibrant small business sector. In stark contrast, since 2013 the Coalition has:

  • Dumped the small business portfolio from Cabinet.
  • Delivered four years of chaos and division on energy policy.
  • Mismanaged the most critical infrastructure project of the 21st century for Australia’s small businesses – the National Broadband Network.
  • Presided over a collapse in Federal investment in productive national infrastructure.
  • Failed to progress Labor’s 2013 Australian prompt payment protocol.
  • Abolished Labor’s  successful instant asset write off in 2014, only to restore it one year later.
  • Voted against Labor‘s sensible and measured “access to justice” reforms in the Senate.

 

Since 2013 Labor has been consulting with small business.

A Shorten Labor government will introduce the “Australian Investment Guarantee” to kick-start new investment, support jobs and build the long term capacity of our economy.

This policy will allow business to immediately “expense” 20% of the value of eligible depreciable assets in the first year of all new investments, with the balance depreciated in line with normal depreciation schedules from the first year.

The Australian Investment Guarantee is a permanent accelerated depreciation scheme – it will operate indefinitely.

It will drive new investment in plant, machinery and equipment –helping Australia’s more than 2.1 million small businesses to lift their productivity.

Where it differs from other policies is that it will also incentivise investments in “knowledge assets” – directly benefiting those small businesses that are innovating and investing in their human capital.

Modelling by Victoria University has shown that an incentive like Labor’s Investment Guarantee when compared to a cut in the company tax rate is actually up to “three times more effective as a stimulus”.

Unlike the Government’s proposed corporate tax cuts – which do not guarantee a single additional cent of new investment in Australia – Labor’s policy only rewards new investments made in Australia.

We have also announced our “Access to Justice” reforms that will empower small businesses to take cases of anti-competitive behaviour to court.

Our policy would allow small business owner to seek a “no adverse cost order” prior to proceeding to court.

We have released a package of reforms to combat illegal phoenix activity, a problem that is estimated to cost the Australian economy up to $3 billion annually and disproportionally impacts on small business.

If elected Labor will restore small business to the Cabinet level ensuring this vitally important sector is represented at the highest level of decision-making in the Commonwealth.

We will have more to say on how we intend to help small businesses grow and prosper in the lead up to the next election.

I want to turn to the vocational, education and training system.

Under the Minister for Education, Simon Birmingham and Assistant Minister Karen Andrews, the government failed to ensure that our vocational education system is fit for purpose.

The Skilling Australians Fund, the so-called centrepiece of the Coalition's policies on vocational education, was announced more than a year ago and has still not contributed one cent to the national training effort. 

In fact, at the last budget the Coalition cut the Fund by $270 million – the equivalent of support for more than 27,000 apprenticeships.

The Liberals have wasted $24.1 million on a disastrous, now abandoned, five-year apprenticeship IT system upgrade, despite warnings from the very first assurance review conducted in July 2015, that the project appeared destined to fail.

They will now spend an additional $1.3 million just to “maintain the current capability” of the original 1999 system – and the Minister still doesn’t know what it will cost to successfully upgrade the apprenticeship IT platform to bring it into the 21st century.

We also know employer investment in apprenticeships is declining. We can see that in the figures.

Since the Coalition came to office the number of trade apprentices and trainees in training has dropped by 25 per cent and that training rate has fallen below 10 percent for the first time in at least a decade.

A research note published recently by AiGroup reported on a Business Prospects survey of their CEO members.

They identified skill shortages as a prominent factor inhibiting business growth – at twice the proportion of CEOs from the previous year.

Despite more than half of AiGroup members having previously identified key skill shortages in technical and trades areas, only 2 per cent of CEOs planned to respond to their labour and skills needs by employing apprentices and trainees.  Instead, 30 per cent planned to recruit people already skilled and experienced.

These figures suggest that our rate of trade and technical training will only worsen unless something changes.

While apprenticeship numbers continue to decline, the Coalition have showed their willingness to fund Pauline Hanson’s spurious 1,000 apprenticeships proposal; and have already funded former Senator Bob Day’s dodgy student builder pilot for 17 students – with funding that would otherwise support an additional 6,300 apprentices.

The government clearly don’t like facts or scrutiny. The NCVER provides us with powerful and important data about training and apprenticeship rates. Without them, for example, we wouldn’t know the current decline in training rates.

Yet, in Senate estimates last week it was exposed that the Coalition is cutting the NCVER independent research budget by almost a third.

It is still unclear what impact that might have – but it is fair to say that there are already significant gaps in our understanding of the system. Cutting our capacity to gather evidence, while typical of the Coalition, is another blow to the community.

Despite recent advice from Professor John Halsey to the government making clear that; 

“TAFE has to be put back in the regions, closer to people and the heartland of much of Australia’s productivity” - the Coalition continues to ignore the critical importance of quality public provision.

They have failed at every turn to ensure the sustainability of our TAFE network and constantly deflect responsibility to the states and territories.

The Coalition has provided no leadership on vocational education and training. Instead they have cut funding; have used apprenticeships as a crude bargaining chip to curry favour with cross benchers; have reduced the evidence base and have neglected TAFE. Trust in the system is at an all-time low.

Labor’s commitment to creating a high quality vocational education system is unflagging.  It is in our DNA. We want private providers and RTOs to be of high quality and integrity.

Labor will invest in TAFE and apprenticeships and ensure Australians have the skills they need to succeed in our changing economy.

Labor will:

  • Guarantee two out of three public vocational education dollars goes to TAFE.
  • Waive upfront fees for 100,000 students to attend TAFE.
  • Invest $100 million in modernising TAFE facilities around the country.
  • Ensure one in every 10 jobs on Commonwealth priority projects are filled by Australians apprentices.
  • Provide 10,000 pre-apprentice programs for young people who want to learn a trade.
  • Provide 20,000 adult apprentice programs for older workers who want or need to retrain.

 

Importantly, Labor will establish a once-in-a-generation National Commission of Review which will examine all aspects of Australia’s post-secondary education system.

It will examine and make recommendations about how vocational and higher education systems can address the country’s economic and societal needs.

We are living in a time of rapid change driven by globalization, artificial intelligence, robotics and digital transformation and the Internet of things. It is impacting on all aspects of our lives.

Now more than ever we need a post-school education and training system that responds to those changes, and works for every Australian.

We need a system built on quality, collaboration, depth, reliability and transferability that:

  • equips people with knowledge and education for good working lives;
  • skills the workforce for existing and emerging jobs;
  • produces skills that power innovation and good jobs;
  • provides greater social engagement and inclusion by guaranteeing access to quality lifelong learning and further education;
  • in apprenticeships, provides a contract for employment and a contract for training with nationally recognised portable skills; and
  • recognises the importance of highly skilled TAFE teaching professionals.

While the progress we need isn’t being delivered in the system that is operating we have a great opportunity before us to change that – not for the sake of change but in the national interest.

Finding the best way forward will be difficult. It will be both intellectually and practically challenging - but it needs to be done.

It is also abundantly clear that the only way it will happen is under a Labor government.

My promise to you is that Labor will work to build a well-resourced and vibrant VET system – with sustainable TAFEs and quality apprenticeships at its heart.

In return Labor expects business to invest in quality training and work with us to build that world class VET system.

This is essential to ensure the prosperity that we have enjoyed over many years continues for the generations to come.

The combination of strong economic policies, a focus on reducing inequality and building a vocational education system that is fit for purpose are fundamental issues that a Shorten Labor government will address.

Education, health, infrastructure and housing and homelessness policies all come together to build a good society and a fair society.

Thank you for the opportunity to talk to you today about Labor’s priorities and I wish you well for the rest of your conference.

ENDS
Authorised by Noah Carroll ALP Canberra