Small Business Funding
SMALL BUSINESS FUNDING
The Hon. B. H. VAUGHAN: My question is directed to the Minister for Planning and Minister for Housing, representing the Minister for Small Business. Given the recent study by the Bureau of Industry Economics, which cited the lack of available finance as a major obstacle to the growth of small businesses, and the fact that most finance came from owners' funds or related earnings, will the Minister urgently support current consultations with the banking industry with a view to establishing finance through proposed cash flows as a viable alternative for funding small business expansion?
The Hon. R. J. WEBSTER: No government in the history of New South Wales has done more to help small business than this Government. The Government has done that not by providing small business with subsidies that merely prop them up, but by providing a climate and a framework within which small business can grow and prosper.
The Hon. B. H. Vaughan: Does the Minister understand what cash flow financing is?
The Hon. R. J. WEBSTER: The Deputy Leader of the Opposition belongs to a party which, throughout Australia, has been disgraced over the past decade for the profligate way in which it has wasted taxpayers' money.
Honourable members opposite do not like it, but I am going to give it to them, because I well recall that when this Government was elected in 1988 Premier Nick Greiner decided to sell the New South Wales Investment Corporation as one of his first
priorities. The Investment Corporation was the Opposition's answer to picking winners in the business community. The people of New South Wales should be very grateful that the Government sold that business because once the recession started to bite, the unfortunate people who purchased some of the companies in that investment portfolio very quickly found out just what poor backers of winners Opposition members were.
Thank God that the Government did sell that investment corporation. Obviously there is a need to provide venture capital for small business; there is a need to assist small business through the banking sector, and this Government has contributed more than any other government in Australia to reducing inflation which, of course, reduces the pressure on interest rates. Sydney - and New South Wales - now has the lowest inflation rate of any city in Australia, a pretty big achievement when one considers that Sydney is the biggest city with the greatest number of cost pressures of any city in Australia.
The Hon. J. R. Johnson: Are you taking credit for that?
The Hon. R. J. WEBSTER: We certainly are. It is no coincidence. The last jobs survey showed that of the 158,000 jobs created in Australia during the survey period, 98,000 were created in New South Wales. That is no coincidence either. We have gone from being the highest taxing State, when Labor was in power, to the second highest taxing State. New South Wales has a triple-A State-credit rating, and Queensland is the only other State with such a rating. These things do not just happen out of the blue. They happen because of the deliberate policies of this Government. As I have said before, we are now in the second half of our first decade in office. I assure all honourable members that when the Leader of the Government in this House addresses the Parliament just prior to the Olympics in the year 2000, he will be saying exactly the same things about our fine economic record.
All I can say to the Deputy Leader of the Opposition is: of course I am sure my colleague in another place is doing all he can to ensure that the banking sector is providing adequate finance to small business. If he is insinuating through the tone of his question that we are somehow going to go out and start picking winners and offering finance to companies that cannot stand on their own two feet, he is sadly mistaken. The way to assist small business is not to load it up with costs or additional taxes - that is what the Labor Party's mates did in Canberra. The Federal Government was not going to introduce a capital gains tax, but it did; it brought in a fringe benefits tax - in the 10 years it has been in office, it has brought in just about every form of tax ever thought of. This Government has reduced electricity charges in dollar terms every year for the last three years and water charges to businesses came down by 30 per cent last year in dollar terms. That is what small business needs to keep afloat; that is what small business needs as an incentive. That is the way to encourage small business in New South Wales, not by trying to prop it up.