Regulatory blues

As Wayne Swan and Bill Shorten take out their carving knives and tax scales and the RBA considers a salutary anti-inflationary jolt to business expectations, it would be a great time to consider the impact on smart companies.

At a time when customers are getting the benefit of lower import costs and exporters are feeling the pressure of a greater than parity dollar, it is too easy to forget the fact that more than half the new jobs in the year ahead will be created by start-up and small business ventures.

While the big end of town is doing very well, the rise in fuel prices and proposed new taxes on small business are increasing concerns about the directions that are being developed by Treasury.

As Gary Morgan says, “The Australian is now at its highest level since May 1982, more than a year before it was floated in 1983. Consumer confidence has fallen 2.0pts to 115.6 as a increasing numbers of Australians worry about their personal finances, with 35% (up 2%) saying their family is ‘worse off financially’ than a year ago and 22% (up 3%) expecting to be ‘worse off financially’ this time next year.

While the markets are relatively stable, and the Government is seeking vote winning concessions for acceptance of major tax reforms and considering another round of discouraged worker bashing, it might be appropriate to introduce a Regulatory Flexibility Act (RFA) along the lines of the US model.

As with the mining tax, carbon tax and flood mitigation taxes, it is far too easy to deal with the big end of town and forget the people who are actually getting our unemployment figures down to better levels. Anyone over 50 is still finding the hunt for a new job is not only painful, but if they have been running a small business, very costly and time consuming. Small business is still being penalised with rules that discourage taking on part-time and casual workers.

The US Government has recognised that job creation and reduction of regulatory blues is the highest priority of its action plans, unlike our own that appears to be more interested in punishing the unemployed than reducing payroll taxes and creating new job opportunities within small and medium enterprises.

Their Federal Government has saved small entities billions of dollars in foregone regulatory costs by following the RFA’s direction and minimising the impact of regulatory mandates on small business.

In one case after another, regulatory sensitivity toward small entities has been achieved without sacrificing environmental protection, workplace safety, border security, and other goals of Federal regulations.

Some of the steps that are proposed in the States could well be incorporated here including:

• to provide for public petitions for review and analysis of burdensome regulations without regard for how long the rules have been in place
• to allow small business comment at the Environmental Protection Agency, Occupational Safety and Health Administration, and Consumer Financial Protection Agency
• define “impact” as including the reasonably foreseeable effects on small entities that purchase products or services from, sell products or services to, or otherwise conduct business with entities directly or indirectly regulated by the rule.

A good start would be appointing Penny Wong and Craig Emerson as the Smart Companies Advocates to oversight a Small Business Advocacy in Government along the lines of the SBA in the US.

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Dr Colin Benjamin is an entrepreneurship and strategic thinking consultant at Marshall Place Associates, which offers a range of strategic thinking tools that open up a universe of new possibilities for individuals and organisations committed to applying the processes of innovation, creativity and entrepreneurship. Colin is also a member of the global Association of Professional Futurists.