At last, government goes into bat for small business
Late last year Canberra bookseller Peter Strong received a surprise telephone call from Treasurer Wayne Swan. Soon after he heard from then-Assistant Treasurer Bill Shorten.
Neither was as big a shock as what Penny Wong did. The Finance Minister walked past Mr Strong one day, stopped, and walked back to introduce herself.
Peter Strong, proprietor of the splendid Smiths Alternative Bookshop, was being feted by the nation’s top three elected economic managers.
Swan, Shorten and Wong were not after novels. They wanted advice from Mr Strong in his other capacity as chief executive of the Council of Small Business of Australia (COSBOA).
One outcome of these chats was that on Friday Prime Minister Julia Gillard announced that, for the first time, small business would get cabinet representation through minister Brendan O’Connor.
It seems someone in Government has realised that corporations aren’t people but small business is, usually unincorporated battlers. Australia’s billionaires have one vote each; small business has at least 2.5 million votes.
Early last year news.com.au analysed the survival rates of micro businesses, the most common type of small operator, in federal electorates. It found the failure rates were high in seats which changed hands at the 2010 election.
Last week it was revealed that the small business bankruptcy rate increased by 48 per cent last year.
The billionaires were doing well but the important sprats of the economic pond were struggling and if they went down they probably would take any votes for the Government with them.
And there is an economic imperative. Small business is a huge employer, and makes up much of the service sector which the Government hopes to grow as a complement to the booming resources industries.
In 2010-11, Australia exported about $108 billion worth of services, with a large part made up by the tourism trade which is heavy small-business intensive.
Someone in the Government somewhere had a SME (small to medium enterprise) epiphany.
“The tax forum last October seemed to be the momentum,’’ Mr Strong told me.
“Wayne Swan mentioned me a couple of times in his final speech to the forum, which was nice. I had people from the Tax Office the Treasury come up and say, ‘We have to meet’.
“I had two other meetings with senior people in Treasury saying, ‘What do you want?’ And then I noticed there was much more discussion on small business happening.
“And one day I was listening to Question Time, writing a bloody report or something, and it was just small business - bang, bang, bang. Bill Shorten got up and said, ‘Let me acknowledge small business are people and they want their Sundays back’.
“All this sort of stuff’s coming out of them. And the next morning I got a call from Wayne Swan saying, ‘Just want you to know we talked about small business.’ And 20 minutes later I got a call from Bill Shorten saying the same sort of stuff.’’
Suddenly Mr Strong found that if he wanted a meeting with a minister or a senior official he got it: “I had to be careful not to ask for too many meetings.’’
The feting included an adviser from Julia Gillard’s office and visits to the bookshop by other officials.
Just after Christmas Mr Strong had a meeting at The Lodge with Julia Gillard where she said in effect, “What are you looking for?’’
Cabinet representation was high on the list but certainly not the only item mentioned. COSBOA also is looking for a federal small business commissioner, and relief from the job of being unpaid tax collector for the Government.
Peter Strong says the executive who sorts out BHP’s superannuation system gets paid by the company. A small business manager doesn’t have that luxury, and doesn’t have the time either.
And there is the perennial call for cuts in red tape generally and the tyranny of contract law. The Opposition has pledged to remove $1 billion worth from the back of small operators.
Which points to another impetus for the Government to get more acquainted with small business. It is one of the few policy areas where the Opposition is making ground.
“I’ve got no fear of saying a lot of momentum started when Bruce Bilson went into the shadow small business minister’s job. He got it (about small business),’’ said Mr Strong.
“I had become very cynical about people in shadow small business positions, especially the Libs. They haven’t been great friends. And that has changed and the change has come from Bruce.
“At the root level he understands we are people.’’
A few months ago Penny Wong walked past Mr Strong in Parliament House, stopped and went back to shake hands.
In one of their chats she summed up the small business situation: “You have been underdone for such a long time.’’
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