Election 2007 scorecard: Labor wins… just

A cool-headed analysis by the SmartCompany team of the policies put forth during this election campaign, keeping a strong focus on the best interests of SMEs, has revealed a result we didn’t expect.

The Labor Party policies released in the election campaign have more benefits for business than the Coalition’s.

Surprised? So were we.

For months the SmartCompany team, led by political editor Mike Preston, has been analysing the issues from a business-owner perspective.

Yesterday the team sat down and analysed the policies one-by-one. It was close, reflecting the “me too” nature of the campaign.

Both parties were given a big fat zero for having no entrepreneur vision or strategy, and both parties did fail here.

But by the end, Labor was declared the winner – with a score of 35 out of 90 to the Coalition’s 33 – of SmartCompany’s policy scorecard for the 2007 federal election.

This wasn’t the result the SmartCompany team expected when we sat down to evaluate Labor and Coalition policies on the big issues facing Australia’s SMEs.

All year we have reported on the advantages that many business owners believe the Coalition’s industrial relations policy – especially its exemption on unfair dismissal – holds for small business.

This view has been reflected in much of the feedback we have received from our readers and, this week, in the strong support for the Coalition reported by small business owners in SmartCompany 2007 Election Poll.

When we went through each party’s election promises, the Coalition strongly outscored Labor on industrial relations and tax, both core policy areas for small business.

But our analysis also highlighted Labor’s strengths in policy areas of equal importance: broadband, skills, the environment, red-tape, industry policy and franchising.

When we calculated the final score of each party across all policy areas, these strengths put Labor in front, albeit narrowly.

This result is not a reflection of which party has the best vision for the future of Australian SMEs. In fact, the failure of both Labor and the Coalition to respond a list of SmartCompany questions, and their failure to subsequently reveal any policy, reveals that neither party has one.

It also is not about the performance of the Howard Government over the past 11 years. Elections are about who will best govern the country for the next three years, not what they have done in the past, which is why we have focused on the promises made in the election campaign.

What we didn’t try to do is rank any one policy area above the others. The diversity of the SME sector makes that a fruitless task: a medium-sized business in the renewable energy sector will have dramatically different policy priorities than, say, a smaller retailer.

So while we have scored Labor and the Coalition on their policies, deciding which issue is most important – and, for that matter, which party is most deserving of the SME vote on Saturday – is entirely up to you.

Skills

The Coalition work skills voucher program is a good short-term solution for businesses that want to up-skill their employees, and its promise to provide training vouchers for SME owners is a welcome acknowledgment of the challenges that come with running a small business.

Labor, however, has offered the stronger longer term plan for fixing the skills shortage with its promise to spend close to $1 billion to create 450,000 training places, 200,000 more than the Coalition.

But both parties have largely gone missing when it comes to more funding for higher education, a fact that pushed down both their scores despite the big dollars spent.

Coalition:

Labor:

Industrial relations

Despite problems with WorkChoices red-tape and the bungled implementation of the fairness test, the Coalition’s promise to keep the unfair dismissal exemptions for SMEs and AWAs means it is well ahead on industrial relations.

Labor’s improved policy on independent contractors and proposed fair dismissal code give some hope to SMEs, but are far from compensating for the promised reversal of the Howard Government’s industrial relations reforms.

Coalition:

Labor:

Environment

This week’s SmartCompany 2007 Election Poll showed that SME owners have paid close attention to the climate change and water policies have been put on offer during the election campaign – and they haven’t been impressed by what they’ve seen.

Comparing the policies of the two major parties, however, it is hard to avoid the conclusion that Labor has done better. It has committed almost $1 billion to foster the development of green and renewable technologies and set a renewable energy target of 20% by 2020.

By contrast the Coalition’s commitment to emerging renewable energy technology comes to something more like $100 million, while its 15% renewable energy target doesn’t add anything to the current targets operated by most state governments.

Coalition:

Labor:

Franchising

Franchisee calls for tougher unconscionable conduct laws have gone unheeded by both parties in an area that has received little attention during the campaign.

Labor has, however, promised to introduce good-faith provisions into the Franchising Code, a promise that gives it the edge over the Coalition’s status-quo policy.

Coalition:

Labor:

Red-tape

The Coalition doesn’t have a great record when it comes to reducing red-tape, and they have done little to improve the situation in this election campaign.

Labor, on the other hand, has promised to install a minister for red-tape in its cabinet to enforce a “one in, one out” rule for any new regulation and to cut red-tape involved with government tenders. SMEs will be watching closely to see how these commitments are implemented.

The Coalition:

Labor:

Tax

Personal tax cuts worth many billions of dollars were the biggest campaign promise each party has made in the election campaign, but neither saw fit to put a single dollar towards rewarding business investment and entrepreneurship through the tax system.

The Coalition comes out ahead of Labor because of its commitment to cut the top marginal tax rate from 45% to 42% over the next three years, a change that will reward the intense effort successful SME owners put into their businesses.

The Coalition:

Labor:

Broadband

Labor has led the debate on broadband since Kevin Rudd became opposition leader earlier this year. His promise to spend $4.7 billion on a national fibre to the node broadband network could help put competition back into the Australian telecommunications sector, something Labor communications spokesman Stephen Conroy says is a priority.

The Coalition, on the other hand, hopes to tempt companies to build a fibre to the node network in metropolitan areas with the promise of regulatory concessions. Although cheaper in the short term, it means consumers could be left paying higher prices in the future.

The Coalition:

Labor:

Industry, R&D and grants

The Coalition has not made any significant new industry policy announcements during the election campaign, although it must be noted that this is primarily because it put in place a $1.4 billon industry plan earlier this year.

Labor has promised to create 20 new enterprise innovation centres around the country, but it was its late promise to boost funding and improve access to the Export Markets Development Grants scheme that most impressed.

The Coalition:

Labor:

Entrepreneurial vision

 The Coalition:

Labor:

Do you agree? Want to remark any area? Tell us what you think. Email feedback@smartcompany.com.au