Watch Matt's speech here
Mr KEOGH (Burt) (10:27): Since coming into the shadow portfolio of minister assisting for small and family business, I've had the opportunity to travel all over the country to meet with small and family-sized businesses—Darwin, Hobart, Gosnells, the Central Coast of New South Wales, Katoomba and Melbourne—and discuss what government can do to help them, to understand what is confronting them in their lives and in their businesses. And whilst they have raised many issues that are quite specific to their industry or their town or city, or the businesses in which they operate, there are some commonalities. One of the biggest commonalities that comes up time and time again is access to finance, particularly getting access to capital. It's hard for small and family businesses to get off the ground or to find that necessary finance to expand, especially when they're being forced into the situation of having to put up their own home as security. After all, you wouldn't feel that secure if your business or your home, and especially not both, was at risk of being lost in the current economic circumstances.
The Council of Financial Regulators tells us that lending to small business has hardly grown over the past year. In November last year, they reported that lending to small businesses has hardly grown over the past year, compared to a five per cent increase in lending to large businesses. One of the consequences of anaemic wage growth in our country that we're seeing under this government is there is no money flowing into small businesses around Australia. I've heard this frequently on the high streets around our country: there is no income for people to spend in their shops.
Small businesses and their representatives tell us frequently that banks are not lending money to small business and the life support that this country's economy is currently relying on means that people are holding onto money; they're not spending. So even if small businesses are able to get off the ground, it's difficult to survive, let alone expand. The banks tell us that they're not doing anything to throttle the small businesses of our nation, they're not restricting access to capital, but we are now in a circumstance where it's time for them to put their money where their mouths are.
The Australian Business Growth Fund Bill 2019, by all intents and purposes, should be a step in the right direction with regard to supporting small and medium enterprises around Australia. Small and medium businesses, after all, are a huge proportion of our businesses across the nation, with about 3 million SMEs across the country employing over seven million Australians. For years, the sector—specifically, the Small Business and Family Enterprise Ombudsman—has been crying out for assistance for small business in getting access to finance. That's why they've championed the Business Growth Fund model that is before us today. Because these businesses need help, they need our support, and, frankly, in the current circumstances that confront so many areas of our nation that are dealing with the tragedy of bushfire, they need even more. Labor absolutely wants to see small business across our nation grow and thrive, and that's why we will support this legislation in this place.
But we do also want to be sure that this fund will work properly, in order to best benefit commercially viable small and medium enterprises who legitimately need finance but are unable to access it now. Questions must be asked about such legislation when only four days of consultation were provided in relation to it. You would think that if this government were serious about getting this legislation right and making sure that it actually delivers on its promise more time for consultation would have been provided.
Frankly, the engagement that the Treasurer has had with relevant stakeholders has been woefully inadequate. As with any piece of legislation within the economic realm, the devil is absolutely in the detail, and we don't have all of that detail in front of us. The government has not publicly provided sufficient detail on the governance and operation of the fund. The fund will not be in a Commonwealth business enterprise or a Commonwealth company and nor will it be within the public service, but it will be an incorporated company, meaning that the Commonwealth will end up as a minority shareholder in a private company. The fact that this is a private company—not a government business enterprise, which brings with it government regulation and oversight—raises questions about how the Commonwealth and the banks will end up working together for this common purpose. This is difficult to determine, given that there has not been any demonstration of the mandate that will govern the fund.
A short Senate inquiry will of course provide an opportunity to get clarity on the mandate and the government's arrangements for the fund. It will also ensure that anything that is required to guarantee the success of this program can be done. It's our prerogative as a parliament to ensure the success of this fund and to properly oversee any proposals. Frankly, small and medium enterprises across the nation are relying on us to do that with this legislation.
We are still waiting on promised reform to support small businesses in so many different areas from this government, whether it's unfair contract terms, fair payment times, dealing with the unfairness of the current franchising regimes or, indeed, phoenixing. So we want to ensure that at least this initiative before us today will come into effect as soon as possible and operate as it is intended, to make sure that we have this positive benefit that small and family business is so desperately crying out for right now, and that's why we're happy to support the legislation in this place.