Rating Labor’s small business ministers

The appointment of Chris Bowen as the government’s fourth small business minister in 14 months received a mixed reaction from business.

A little bit of cynicism may be understandable when you consider that the role of the small business minister is one not often held onto in the Australian Labor Party.

What can we expect from Bowen? SmartCompany has taken a close look at the last four small business ministers to try and work out exactly what they achieved. It gives some indication of what Bowen is likely to be able to achieve for small business between now and the election.

Here’s our report card:

Craig Emerson: Score 5/10

Duration: December 2007 – November 2010

The first person in the role under the Rudd government in 2007, Emerson was also appointed minister of competition policy and consumer affairs in June 2009. Prior to entering federal politics in 1998 in the Queensland seat of Rankin, Emerson had held a variety of roles including an economic analyst with the United Nations.

Achievements:

• Small business support line
• Announcement of the instant asset tax write-off
• Announcement of simplified depreciation rules
• Harmonisation of consumer laws across states and tougher penalties for unfair terms in contracts
• National register for small business names announced
• Henry Tax Review
• Announcement of new R&D tax credit scheme
• Introduction of the superannuation clearing house service
• Appointment of a deputy chair with small business knowledge to the ACCC

Peter Strong, chief executive of the Council of Small Business Australia, says Emerson was in the role during the “early days” of engagement with the sector.

“He basically came into the job in the early days of engagement with the sector. I had quite good engagement with him, but you can see the difference between having someone in cabinet and not. Before Emerson, the Labor Party hadn’t paid attention to small businesses and in some ways he had to bring the rest of the party with him.

“I think Craig certainly understood small business, but he never got the chance to implement the changes. He fought hard for small business, but he was there for a time when a lot of the party didn’t get it,” he says.

But Strong says under Emerson paid parental leave was announced, angering the small business community.

“Under his reign the government brought in paid parental leave. We argued long and hard that this shouldn’t have happened, so this was disappointing.

Russell Zimmerman, executive director of the Australian Retailers Association, believes Emerson introduced a number of policies which have been important for small business retailers.

“Emerson announced the instant tax write-off, which was a great one for retailers. The small business support line was also good, but there needs to be more emphasis put back on industry associations. And the register of business names was also great for retailers,” he says.

Andrew Conway, chief executive of the Institute of Public Accountants, says Emerson brought a strong financial background to the role, but was always destined for another portfolio.

“He brought a degree of economic policy rigour to the position which was good. He engaged, was interested in small business – particularly in the area of franchise law.

“He was the longest serving, but probably still did not have enough time. Generally he was always thought of as a person bound for another portfolio. However, he was effective and quite a good advocate,” Conway says.

Rating out of 10

• Strong: 5/10
• Zimmerman: 7/10
• Conway: 5/10

Nick Sherry: Score 6/10

Duration: November 2010 – December 2011

Sherry entered politics in July 1990 as a Tasmanian senator. Prior to being the small business minister he was appointed as the first minister for superannuation and corporate law in 2007 under the Rudd government. In June 2009 he was given the role of assistant treasurer, a position he had until becoming the small business minister in the Gillard government.

Achievements:

• Small business roundtable in Tasmania
• For the first time all government agencies settled 90% of small business invoices within 30 days.
• Introduction of the R&D tax credit scheme (significant tax offsets to encourage research and development)
• Instrumental in the success of the superannuation clearing house: The number of small businesses registered doubled and over $88 million in super contributions were made.
• Increased federal government engagement with small business

Sherry’s knowledge of superannuation was an asset to the role and he fostered engagement between the federal government and small business according to Strong.

“With Nick, the engagement really started growing. Early on there wasn’t a heavy amount of engagement but when he realised we were talking policies not politics he started paying attention,” he says.

Strong says Sherry came to COSBOA’s summits and was easy to engage with and “interestingly some of his staff have moved on to the assistant treasurer and other important departments”.

“He was instrumental with Chris Bowen in the success of the superannuation clearing house,” says Strong.

“Otherwise it was largely transitional stuff, moving from not much engagement with small business to realising we are important – he got the ball rolling.”

Zimmerman says Sherry is most remembered for some comments he made about the decline of bookstores for which he was highly criticised, but he says people should instead remember him for his work with the superannuation clearing house and small business invoices.

“He did a lot in terms of making sure small businesses were invoiced on time. I have a friend who was a locksmith who supplied the government with a lot of locks, so I suppose that was an achievement for some,” he says.

Conway says Sherry’s s financial services background was an asset to the role.

“Nick Sherry, in our view, was an effective minister. Because of his strong financial services background, Nick understood what the accountants were on about in terms of small business. But he faced challenges in converting into policy and budget reform.

“The small business sector, in our view, doesn’t really want the government tinkering, there needs to be sweeping reforms,” he says.

Rating out of 10

• Strong: 7/10
• Zimmerman: 6/10
• Conway: 6/10

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