The Federal budget highlights one great need for small business, and that is a rational coherent national strategy.
This budget and indeed the last 20 federal budgets have included a whole range of good and bad measures for small business people. But there has never been a strategy to underpin those measures.
There has never been a real statement of aims and objectives that we want to achieve. There has never been a documented comprehensive vision for the families who earn their living from their own business and who employ almost five million other people, and underpin our economic health.
A small business strategy would include a description of the sector including comprehensive statistics and a summary of the economic health of each sub sector.
There are parts of the small business community that are thriving and growing, for example construction. And there are parts that are under major stress, particularly retail.
A strategy would include information on what helps and what hinders small business. This would include issues around compliance, taxation, competition, urban planning and workplace relations. And at budget time, the strategy would include measures from the budget and the impact of those measures.
This budget has bits and pieces of good news, or potential good news, for small business. But a lot of this good news would not have been developed with small business in mind. As a matter of fact, this budget is without a doubt a “Big Business” budget – but aren’t they all?.
The measures from this budget that have the potential to help small business, if they were included in a plan, include little hidden-away items from various departments and agencies.
The development of better regulation around the NBN can also be focused on keeping the internet a fair place for trade and ensuring that small businesses are not gouged by service providers.
The development of better support for skilled migration at the local level should benefit small business people who always struggle with red tape and application processes.
The big ticket item based around skills development should also benefit small business, but there is a question around whether there is direct support for them in accessing training and training funds.
Application processes are often designed by consulting with big business experts and therefore fail to be user friendly for a small business person. It appears that one of the great providers of support to small business, Group Training Australia, has had some funding not renewed, and they will struggle to assist small business.
The continuation of infrastructure projects around Australia will also benefit many small businesses in the communities affected, and provide new opportunities for contractors and the self employed. It also provides opportunity to develop new businesses and new business processes for these projects and people in small business are the great innovators, the ones who can quickly recognise an opportunity and do something about it.
Big businesses are too slow and ponderous and involve decision making based around boards of directors and process that slows down decision making and adds complexity.
A plan for small business would have any budget measures included with benefits for small business highlighted. A plan also creates the opportunity to assess what the real impact would be on small business and whether the measures can be tweaked to make them more effective.
It would also provide an opportunity to assess any negative impact on small business people and either justify the decision or change or remove that decision altogether.
A plan would, for example, also provide better justification for the decision around the forcing of independent contractors to do a lot more paperwork for the tax office. A plan, by its nature, would include facts and statistics. It would show the number of contractors who are rorting the tax system and estimates on how much has been rorted. A good plan might also highlight other options and why these options were rejected. A good strategy will alleviate fears, provide information for comment and make it easy for people to contribute to future inclusions.
A plan would also help create better outcomes and higher uptake of other budget measures.
The ‘Buy Australian at Home and Abroad’ program will hopefully be accessed by small business or at least have increased positive impact on small business people in areas of major projects. This depends upon the complexity of paperwork associated with the program and the willingness of the program managers to engage with small business. Including this in a plan would help identify issues and solve potential problems.
A good strategy means that expenditure is better spent, that people are more involved, that measures are better understood.
The most important outcome from a small business strategy in Australia will be found if and when the resources boom slows down or when another GFC type event hits the economy. If we have a strategy we can be more confident that the small business sector is healthy and able to handle change.
When crisis hits and mines close and big business conducts mass retrenchments, as they do, we will turn to the small business community so lets turn to them now and give us all a strategy and a well defined and officially recognised place in the economy.
A strategy really becomes essential when a carbon tax is considered. Will small business people have to wear the increased costs? Will they be able to pass these costs onto consumers? Will the income and the life style of people in business be affected?
One very important area where the self employed are always overlooked is health. Employers are expected to provide a healthy workplace, which is very reasonable, but no one seems to take any interest in the health of a person who owns his or her own business. The mental and the physical health of small business people has to be considered just as important as the health of any other person.
Finally we might even get a proper understanding of the effect of red tape on small businesses and the health of the people that run a business. This government is quite happy to see small business people spend more time away from their families doing pay clerk role for the Paid Parental Leave. They are increasing compliance demands in superannuation and in reporting for tax. They give nothing back.
A plan would at least have an assessment, based upon consultation and research, of the impact on small business of any new red tape.
The Howard government may have found different ways of introducing more complex superannuation rules if they had to include this in a plan. Howard may also have rethought his government’s approach to competition policy if they had assessed the impact on small business families of the behaviour of the Coles/Woolworths duopoly and the monopoly that big landlords have on retail leasing in most towns and cities around the country.
Let’s give the small business community the attention it deserves through a good old fashioned strategy.
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