Small business needs a heavyweight in Cabinet, Julia
With the ALP’s leadership tussle over for now, it’s time for the Federal Government to get back to the much needed policy work on competition, small business and consumer law issues.
These issues are fundamental to the ALP’s re-election hopes as the sky-rocketing cost of living will make struggling Aussie families think twice at election time.
Those Aussie families are sick and tired of the gimmicks or, even worse, the lack of policy direction from federal Labor. Take, for example, small business concerns about the growing market and contractual power of larger businesses. And what about the concerns increasingly expressed by farmers about their dealings with food processors and the major supermarket chains?
While federal Labor has stood by and watched, the South Australian Labor Government has shown true policy leadership by establishing a South Australian Small Business Commissioner with real teeth to deal with ongoing abuses of market or contractual power.
Why hasn’t federal Labor established a federal small business commissioner? A federal small business commissioner would be very valuable in assisting small businesses to try and resolve disputes with larger businesses.
A federal small business commissioner could effectively enforce mandatory federal industry codes of conduct if the Government did the right thing and imposed financial penalties for breaches of these so-called mandatory industry codes. How can any industry code be mandatory if there are no financial penalties for breaching the code?
Surely, any federal small business minister concerned about promoting industry best practice would want all industry participants to fully comply with an industry code and would make sure it happens by imposing financial penalties for non-compliance with a code.
Take franchising for example. It’s an important sector of the economy, but its success can so easily be compromised or undermined by a franchisor that doesn’t fully comply with the federal Franchising Code of Conduct. There can be no doubt that imposing financial penalties for breaches of the franchising code would promote full compliance with the code.
Promoting full compliance with the franchising code would lift the franchising sector’s image and promote confidence in the sector. Promoting confidence in the sector would lead to greater investment in the sector which can only be a good thing for Australian franchising.
With Mark Arbib having announced his departure from Parliament there’s now a federal ministerial vacancy in the small business area. Let’s hope that we get a new federal small business minister that likes developing policy initiatives that help small businesses in their dealings with larger businesses.
After all, small businesses are the forgotten voters who like their small business ministers to spend time standing up for small businesses rather than giving them excuses for any Ministerial inaction that plays directly into the hands of the big end of town.
And while we are getting a new federal small business minister we can only hope that we’ll get a new minister in the competition and consumer area. There have been too many Labor mistakes and gimmicks such as FuelWatch and GroceryChoice and it’s time for a fresh policy perspective.
Maybe we need a new federal competition and consumer minister to spend less time in the Qantas Chairman’s lounge or counting numbers for a leadership ballot, and more time developing policies that increase real competition and empower consumers.
Not enough is being done to encourage new competitors into key sectors of the economy such as groceries, petrol and banking. Here the need for new competitors doesn’t just mean more Coles and Woolworths stores. Rather we need new independent competitors. Let’s start by lowering barriers to entry to get more independents into the market.
Let’s talk about empowering consumers. We hear about Woolworths’ strong push into online retailing over the next two years, but consumers can’t find online the shelf prices of all Woolworths supermarkets.
Why can’t consumers get onto their computer to find the cheapest Woolworths supermarket in their local area? After all, Woolworths will often seem to engage in geographic price discrimination where they charge different prices for the same product in different stores.
In an online world any consumer should be able to see all shelf prices online. Now there’s a policy initiative for any new federal competition and consumer minister. And with all of Woolworths’ proposed new investment in online retailing the price of any IT needed to provide consumers with online access to all supermarket shelf prices should now be even lower than before.
Maybe Woolworths and Coles will do the right thing and provide consumers with online access to all supermarket shelf prices. If they don’t, then a minister could propose a new mandatory industry code that could require Woolworths and Coles to do so. After all, successful policy leadership by a Minister is all about convincing colleagues and Parliament of the merits of a proposed new policy initiative.
That logic extends to requiring the oil companies and major petrol retailers to each publish online all petrol prices at their respective outlets so that motorists can always find the cheapest service station. Surely any competent and enthusiastic new federal competition and consumer Minister could show such obvious policy leadership to empower motorists?
And what else should any new federal competition and consumer minister do? That’s easy. Have a close look at the ACCC. A good way to save money would be to abolish the ACCC Petrol Commissioner role. The motoring bodies around Australia already watch petrol prices so we don’t need an ACCC Petrol Commissioner to duplicate the price monitoring undertaking by those motoring bodies.
Abolishing the ACCC Petrol Commissioner would be simple. What would be more challenging from a policy development point of view would be to actually keep the ACCC Petrol Commissioner and give the person some real new powers to bring the oil companies and major petrol retailers into line.
Naturally the free market theorists would argue that the ACCC Petrol Commissioner shouldn’t be given any new powers and so obviously they will also be calling for the abolition of the ACCC Petrol Commissioner. Now that would be interesting to see!
Of course, there’s a real possibility that we won’t get a new federal competition and consumer minister this week and we’ll continue to suffer the long-standing policy vacuum in this all important area.
And then again with a federal election due next year we may eventually get a new federal competition and consumer minister as part of a new incoming government.
Given that a new incoming Federal Government may not be a Labor one, one would think that would be enough to quickly focus federal Labor’s attention on competition and consumer issues.
Now surely that’s something really constructive for federal Labor MPs to think about while sitting in the Qantas Chairman’s lounge or counting the numbers for the next leadership ballot.
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