Small business is Gillard’s blind spot: Maley

The Canberra political commentators keep saying Julia Gillard has three items on her agenda before calling an election – slashing the mining tax (achieved); the refugee policy and carbon pricing. But there should be a fourth agenda item – small and medium sized enterprises.

By now Gillard should know that Treasury knows next to nothing about mining. What she does not know is that, if it’s possible, whether Treasury knows even less about small enterprises.

The miners were lucky because Resources Minister Martin Ferguson not only knew a lot about the mining industry but was respected in cabinet. In small business Kevin Rudd, partly because the experience of his wife Therese, understood smaller enterprises, but Rudd has gone. Wayne Swan also understands the sector but he is now much too busy. That leaves small business minister Craig Emerson as a lone voice. He is good but he has limited clout and too often he gets swamped.

When last year assistant treasurer Nick Sherry backed the amazing plan to decimate independent contracting by classifying most independent contractors as employees I thought that it reflected one minister’s simple ignorance of how the contracting system works.

But subsequent actions have shown that this smaller enterprise ignorance covers a much wider area of government. For example when it came to parental leave the government’s mistakes will mean many may miss out on receiving money due to them. Parent leave payments for the first six months will be undertaken by Centrelink, but after that employers will have to make the payments. The government will reimburse employers (although, strangely independent contractors will still be able to claim their payments direct from Centrelink).

It seems that the government took most of the parental leave away from Centrelink and made employers pay it and claim it back because the union representatives in the government could see a potential union bargaining chip to get employers to pay more than the government minium.

But smaller and medium sized businesses do not have the sophisticated systems to handle the payments. The entrepreneurs must often do their paperwork late at night or at the weekend.

Most smaller and medium enterprise are good operators who will do their very best to make sure their employees are looked after. But we are also going to see some businesses fail or become cash strapped, so depriving parents of the money. There will be many individual sad stories which were preventable had Centrelink continued to handle the payments.

The shift allowance in the new industrial relations law was not designed for smaller enterprises.

In many cases smaller enterprises are more vulnerable to unfair agreements than consumers. The new act to protect consumers has gaps covering smaller enterprises.

The small business blunders of the government might have enabled Tony Abbott to beat Rudd, but Gillard is a harder target. Nevertheless if small business remains off Gillard’s agenda it is Abbott’s best chance of making inroads.

This article first appeared on Business Spectator.