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Divided advocates huff and puff as Labor scorns small business

The Punch and Judy Show is not the defining struggle in Australian politics. Something much bigger will decide the next federal election.

Of the 11.5 million in the workforce, more than 8 million, or 70 per cent, work in small businesses or are self-employed. Small business is thus large in Australia. Very large. And it is getting shafted by the Gillard government.

The rolling series of defeats for small business operators, independent contractors and the self-employed since Julia Gillard became prime minister is as important as any factor in Labor being stuck in a losing rut in the opinion polls since the 2010 election.

In practical terms, it is far more important than the politics of personality. It overrides the mutual disdain between the Prime Minister and the Leader of the Opposition. This is not the main game, even if it provides the main political theatre.

The mystery is why the small business sector is not in open revolt. But the Council of Small Business of Australia is a divided house.

The council describes itself as ''the peak body exclusively representing the interests of small businesses''. But is that true? The former chairman of the council's board of directors, Ken Phillips, doesn't think so. He has just resigned in protest.


''I was on the board of the Council of Small Business Australia for two years and became chair in 2011, but I resigned as chair on October 31, then resigned from the board on November 22,'' he told me. ''I decided to resign after discovering the extent to which the council's financial solvency is dependent upon tobacco interests. I decided that tobacco interests exert significant influence over the council, and I regard this as compromising and damaging to the small business lobby.''

As recently as last Wednesday the executive director of the council, Peter Strong, appeared on Channel Ten to complain about the government's plain-packaging legislation for cigarettes.

''It's hard to see how that serves the interests of small business,'' Phillips said of Strong's appearance on TV.

Phillips is the executive director of Independent Contractors Australia, which until recently was one of 21 groups represented by the council.

Strong rejects the idea that the council has been co-opted by the tobacco lobby.

And last week he released a performance update that laid out how the council had been able to improve the lobbying position of small business in the formation of government policy: ''[The council] is now unambiguously one of the top four industry groups in Australia … with the Business Council of Australia, the Australian Industry Group and the Australian Chamber of Commerce and Industry.''

Although Strong delivered a detailed critique of government policies at the National Press Club in August, his criticisms have been muted compared with the leaders of other peak industry bodies.

On November 16, the head of the Australian Industry Group, Innes Willox, delivered a fiery critique of the government: ''It has been a year of disappointment for business in the industrial relations arena … We simply cannot afford any more delay or regressive changes to workplace relations laws … [and] time-consuming and unnecessarily complex compliance and regulatory obligations.''

The interests of small business are going backwards and the rate of labour force participation is contracting. It is easy to see why:

  Industrial relations: the Fair Work Act is an unfolding disaster for small business, the main job-creating sector in the economy.

 Energy: the carbon tax is contributing to higher energy costs for all businesses. It is also an abrogation of a core election undertaking.

 Health and safety: the greatest union scam of all, using occupational health and safety laws to impose union power, is enshrined in the federal government's move to harmonise OH&S laws under a single federal law.

Intimidation: the Gillard government's dismantling of the building industry watchdog has led to a predictable rise in union lawlessness in the industry.

Outsourcing: the government declared war on outsourcing when it passed legislation in September that mandates public sector conditions on private sector firms which take work outsourced by state governments.

Red tape: the government has just imposed the Equal Opportunity for Women in the Workplace Amendment Bill 2012, which imposes an entire new layer of red tape on businesses with more than 100 employees.

Tax law: the announced tax cuts for small businesses apply ONLY to incorporated businesses. Given that most of the 2.5 million small businesses are unincorporated, about three-quarters miss out.

Discrimination: the government is significantly expanding the range of issues over which people can sue for discrimination.

The list goes on an on. It continues to grow. The government's rhetoric about small business is a hoax, all fluff and tokenism.

One final note: today is the final day I will be sharing this page with Phil Coorey, who is departing. It has been an honour to have him as a colleague.

Twitter @Paul_Sheehan_

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