Kim O’KEEFFE (Shepparton) (18:48): Today I rise to make a contribution on the Local Jobs First Amendment Bill 2025. The bill is for an act to amend the Local Jobs First Act 2003 to clarify the obligations of suppliers and agencies under the Local Jobs First scheme and provide additional enforcement powers for the Local Jobs First commissioner. This bill introduces new civil penalties and other consequences for noncompliance with the Local Jobs First scheme, provides for additional Local Jobs First policy objectives and clarifies references to the Local Jobs First policy and associated obligations and guidelines. The act saw the establishment of the Local Jobs First commissioner, who is responsible for overseeing systemic and project-level compliance with Local Jobs First policy by both agencies and suppliers.
We have had some passionate speakers in the chamber today, and it was really great to hear from the member from Narracan, obviously as a former builder, and some of the things he contributed were so relevant. I also want to share a little bit of my experience as a former educator. I had a lot to do with small business, running some business programs through TAFE. As you know, I have a very long-term business background, 28 years in my own business, and my husband over 45 years in his business, so we understand the challenges when it comes to actually fully running your business. I think this is one of the things, when you look at trades and industries, where they have got their hands on the tools but they often do not have their hand on the lever of how to run their business. One of my roles as an educator was actually helping them manage that and with what that looked like. And do you know what it looked like – it looked like a huge challenge, because they are so focused. If you talk to the member for Narracan, they are so focused, building their houses and doing what they need to do. We see businesses fall over because they do not know how to run a business to the capacity that is needed, particularly when it comes to small business. So it is so critical that we do not put up these barriers, these challenges, these infringements that punish them. We need to educate and we need to support businesses more than ever.
We are seeing businesses in Victoria closing – the numbers are phenomenal – and we need to work harder to really help businesses, not put in place penalties and infringements that make it harder for them to get through their day to day. In my electorate we have so many fantastic building organisations. I have a few close friends that work or run businesses in the building industry. I have a girlfriend who also works in finance. A lot of her work is to do with building industries, and we talk about the collapse of industries and what that means. What does that mean to regional communities when we have a large organisation that shuts down or falls over? It is the small tradies, the small businesses, that are often the backbone to those communities. People know who they are, they trust them and when they go with that particular building organisation they know what they are going to get. One of the things that the member for Narracan said was that the definition of local jobs has never been more important than in what we are discussing here today.
We do have some concerns with the bill. As the member for Kew discussed at great length in her leading contribution on the bill, some of those concerns are around some of the things I have alluded to. The bill includes the introduction of new penalties for the commissioner to use where there is noncompliance. This could lead to suppliers being deprioritised for government tendering, as well as financial penalties for noncompliance. We heard that those penalties are significant. We need to make sure that these concerns are understood, and the concern is the potential impact on Victorian businesses, particularly smaller operators in regional and rural areas. The deprioritisation and civil penalty schemes could unfairly penalise businesses who are unable to meet local content requirements or local industry development plans due to industry circumstances beyond their control. That could be a lack of supplies, skill shortages, a lack of staff, and we hear that all the time. It does not matter what industry you go to at the moment, there are staff shortages and there are skills shortages.
In response to questions about data on previous breaches and civil actions against contractors that has led to this policy response, the department advised that it is not aware of any breaches or actions in relation to specific Local Jobs First deliverables. Where they are not being met, as I said, there is typically a good reason, such as skill shortages in regional areas where local subcontractors cannot be engaged. We do find there may be shortfalls in some of these contracts that may not be able to be delivered locally, but we should be doing all that we can to assist that to happen, not penalising these industries and businesses. The increased compliance will disproportionately impact smaller businesses that do not have the capacity of larger contractors to absorb the additional costs, while the regulatory burden will require more staff and administration, which in effect will favour larger firms and place extra pressure on already financially strained smaller operators.
Under Labor we have seen continued rising cost pressures, which is resulting in businesses facing soaring energy, insurance, rent, wage, tax and compliance costs and regulatory burden and red tape. There are so many businesses, as I said, closing down, and the ongoing increase in the costs of running a business has been relentless, with tax after tax and increasing costs. We should be doing all that we can to assist businesses. Recent data has indicated that over 129,000 businesses closed in Victoria during 2024, including small enterprises, with an average of 530 closures per day. As we have seen, more than 3000 Victorian businesses have relocated interstate. These figures are alarming, and that is something that is happening in our state right now. Victoria does have the reputation of being the most expensive state to do business, and that has to change. We simply cannot afford to keep losing businesses. We are seeing more and more businesses relocate out of Victoria, as I said, and move interstate. The increased compliance alluded to through this bill will disproportionately impact smaller businesses that do not have a large capacity to absorb additional costs.
Another area of concern we have on this side of the house is that there are no details regarding the cost to the budget for these changes. During the bill briefing, departmental and ministerial staff were unable to provide any detail around the forecast budget impact of the measures contained in this bill. I find it quite astounding that we have something before us but we do not know how we are going to afford to pay for it. With the current financial position of Victoria at the moment, how can we have a bill in front of us that does not have any idea of what that cost is going to look like?
Roma Britnell interjected.
Kim O’KEEFFE: I think they need to come to my business course. I think we need to talk about that – how we actually manage a budget, how we manage a business and how a business can thrive and survive in this state. It stands to reason that increased auditing, compliance and enforcement activities would require greater resources for the office of the Local Jobs First commissioner, particularly in terms of employees. How many is that, what does that look like and what is the cost? Labor is refusing to acknowledge this fact or provide any modelling around what these measures will cost to implement. If the government is trying to strengthen an office at the same time as reducing red tape, what does this mean for Victorians and what is the cost?
Under Labor we have seen continued rising cost pressures, which is resulting in businesses facing soaring costs and ongoing taxes and charges, and we need to make sure we start working better when it comes to business, particularly when it comes to regional and local businesses. The Local Jobs First commissioner is responsible for compliance within the program requirements, and this includes new powers and functions, including additional investigation and reporting powers to conduct site inspections with notice and an explicit role to provide advice and support contracting parties in the resolution of noncompliance issues. The bill creates functions of the commission to also report to the minister any time on any matter in relation to the act itself.
In the few minutes I have got left I just want to say that I do support the reasoned amendment put forward by the member for Kew that addresses the potential financial impact on Victorian businesses – particularly, as I have said, small operators in rural and regional areas – and that provides a forecast of the budget impact of the measures contained in the bill. These are not big asks, they are commonsense requests, and I am really hoping that the other side of the house listens to this, because the impacts on small businesses in Victoria are already being felt. We need to make sure that we know what this cost looks like. The building industry are seeing increasing costs, labour shortages – as I said, they have been tough times. We are seeing housing development and we are seeing local businesses working so, so hard to meet demand. But it is challenging, and there has probably never been a more challenging time in Victoria when it comes to owning and managing a business.
Just finally – I have got a minute left – I want to talk a little about tradie that I had a bit to do with when I was doing some of my training. He was dyslexic and he felt he did not have a future. Times were really tough for him. The expectation from others, particularly within his family, was that being a tradie was not a good career. It was a fantastic career, and it was a career that he thrived in. To this day I often think about him, because he went on to be a part-owner of a business. He went on to mentor. That is a big thing when it comes to local businesses and particularly regional small businesses – you are a mentor. The difference I saw in that young fellow by being mentored by a tradie, by a business owner and then going on to have that opportunity – I think that is what we should be aspiring to in this place. We should make sure that people can thrive and survive but also that they can have a successful financial business and that people can have fantastic careers.