SMALL BUSINESS

The Hon. J.D. HILL (Kaurna) (14:12): My question is to the Premier. What are the measures the government is taking to assist South Australian small businesses?

The Hon. J.W. WEATHERILL (Cheltenham—Premier, Treasurer, Minister for State Development, Minister for the Public Sector, Minister for the Arts) (14:12): I thank the honourable member for this important question. Small business is, of course, an essential part of the South Australian economy. We recognise that and, having started my own small business from scratch, I recognise the challenges that exist in creating a small business for anybody.

We need small business to thrive and prosper in South Australia to be successful, but we know at the moment that there are real challenges. The fundamentals are strong; confidence levels have been shaken by international events, spending is tight, and that has a consequential effect on activity, and that is bearing down hard on a number of our small businesses.

We all agree that now is a great opportunity to take steps to try and revitalise confidence in the South Australian small business sector. That is why the package I have announced today is designed to stimulate that confidence. It is more than just a package of financial incentives, although financial incentives there are: it is also a package of information, advice and, critically, support and partnership.

Today, I announced a significant reduction in payroll tax for small business. For the next two years, payroll tax will be effectively halved for small business. For payrolls with a tax-free threshold of between $600,000 and $1 million, the payroll tax will be basically halved: instead of 4.95 per cent, it will be 2.5 per cent. For payrolls between $1 million and $1.2 million, that will phase out.

Under this measure, approximately one quarter of payroll taxpayers will receive an up-front cash concession of up to $9,800 before the end of the year. This will give small businesses an important cash flow benefit in the first part of the next financial year. The payroll tax cut will cost the government $21.6 million over two years, and this is in addition to the $200 million of payroll tax relief for South Australian businesses that have been received over the decisions that have been made by this Labor government.

The payroll tax cuts are also in addition to programs that will provide grants to small business to set up and grow; to create research pilots; to develop innovative new products and services, especially in the manufacturing sector; remove stamp duty on corporate restructures; set up a red tape reduction task force to build on the important work that has already been done in that regard; increase funding to the industry participation advocates so small businesses can win more government contracts; and increase funding to the Small Business Commissioner so they can do more mediation and support.

We have set out in the economic statement that we believe that the future for South Australia is a strong partnership between business and government and backed up by a strong community. That is the way we have always got things done here in South Australia; that is the way we are going to get things done in the future. Small businesses are an important part of that partnership. Increasingly, small business looks to the Labor Party to be their advocate. The Small Business Commissioner was opposed by those opposite. They increasingly look to the Labor Party that understands that we are on their side.

Members interjecting:

Mr MARSHALL: Supplementary question.

The SPEAKER: I'm glad that the Leader of the Opposition can remember that supplementary, but before he asks it could I just call to order the members for Unley, Chaffey and Heysen. Leader—supplementary.