Flat White

Morrison's 'pitch and miss' to small business

11 May 2022

12:00 PM

11 May 2022

12:00 PM

Last week Morrison made his pitch for the small business vote. It fell dead flat. That’s strange really.

If you put to any coalition MP or strategist the following proposition, they’ll immediately and strongly agree: ‘Political parties cannot win government in Australia without a sizable chunk of the small business vote.’

Frankly, talk to any middle-of-the-road Labor MP or professional Labor strategist and they will also agree. It’s almost an Australian political truism.

So, for Morrison (who’s supposed to be ‘Scotty from marketing’) his seeming blindness to this alleged truism is odd. Morrison’s pitch was that by lowering overhead costs and energy bills he’d create a vast number of new small businesses. Yawn!

The pitch on costs is not specific and applies generally to any business (or family) in the economy. There’s no ‘joining of the dots’ between the pitch and the lives of the self-employed, small and family businesses. ‘Scotty from marketing’ surely knows that marketing must be product-specific for the target audience to whom you’re speaking.

Again, it’s strange that Morrison has totally missed his small business target. The Coalition has a substantial history of not only spouting the small business mantra, but of having substance to support the mantra as well. It’s sought to have the policy ‘steak’ to support the political ‘sizzle’. Take some examples…

John Howard created the Independent Contractors Act to protect the status of the self-employed. When he introduced Federal paid parental leave he made this available to small business mums and dads. He did much to reduce the confusion small business people had with the tax collection system.

Tony Abbott committed to the introduction of a Federal Small and Family Business Ombudsman and put the wheels in motion for unfair contract laws for small business. He created Security of Payment laws for construction industry subsidies.

Each of these Abbott era commitments was finalised and delivered under the Turnbull coalition government. Turnbull repealed the Gillard-era anti-independent truckies laws just in time to save the businesses of some 50,000 independent truckies who were about to be forced out of business.

Far too many political strategists, particularly during election campaigns, think that voters just need simplistic messaging. But with some 30 to 40 per cent of voters now being ‘swinging voters’, simplistic political messaging is death. Voters are intelligent and want to see substance. Self-employed, small business people profile strongly on this measure. They are extensive seekers of information. Again, this is why Morrison’s dead flat small business pitch seems so strange.

At the 2019 election, Morrison promised to introduce security of payment laws for small business. He’s done this. And it’s good. It’s strange that he’s not pitching it.

He also promised to ‘beef up’ unfair contract protections for small business people. He’s done all the groundwork on this to make it illegal for large businesses to have (or promote) unfair contracts. The Bill was ready to go, signed off by all the states and agreed to across the political parties. But strangely this major pro-small business Bill was deserted immediately before the election was called. Did the ‘big end of town’ get to Morrison to pull the Bill? The ‘big end of town’ almost sabotaged the current unfair contract laws in 2015. Speculation rules. But it should have been a big Morrison small business pitch. Instead, he’s ignored it.

Then there is the elephant in the room. The Australian Taxation Office has been crucifying small business on a targeted and selective basis. The ATO has destroyed small businesses in the research and development space – claiming dodgy use of grants – but the ATO subsequently admitted that it was wrong.

The ATO has been attacking small and family business trusts, forcing trust beneficiaries to pay tax when (even the ATO admits) the beneficiaries have not received any income. Incredible! The ATO has also sought to change trust distribution rules retrospectively, thereby creating tax debts in the past where, under then-existing ATO rules, no tax debt existed.

In the 2021 Budget the Morrison government declared in Parliament that, ‘We are backing small business in over the ATO. No longer will the ATO be able to garnishee and takeaway (alleged tax debt) while the dispute is in train.’ That is, the government recognised a significant problem with the ATO’s acting unfairly. But this promise turned out to be false. The implemented policy only enables small business people to ‘apply’ to have a disputed debt ‘paused’ until appeals have been heard.

Morrison’s pitch to create large numbers of small businesses falls dead flat if those new (and existing) small businesses find themselves under unfair attack from the ATO without the protections afforded by a rule of law regime.

To win and retain the small business vote, the Coalition has historically made a policy of substance that it then delivers when in government. Then it makes a new promise. Morrison has broken with this process. He’s not selling what he’s already done for small business. He’s avoiding what he failed to deliver. And he’s not promising anything new of substance for small business.

How very peculiar!

Ken Phillips is Executive Director of Self Employed Australia

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