Effects Test, Politics

Greens ready to work with the Coalition to pass effects test

Broede Carmody /

 

The new small business spokesperson for the Greens says he is disappointed the Labor party does not support the introduction of an effects test, but says he is willing to work with the federal government if it decides to forge ahead with bringing Australia’s competition law in line with other developed nations.

Every developed country in the world has an effects test except Australia and New Zealand, but, despite this, the Business Council of Australia has been arguing the introduction of an effects test could have a “chilling” effect on competition.

Prime Minister Malcolm Turnbull agreed to discuss the effects test in cabinet in order to gain the support of the Nationals after he took over the leadership of the Liberal Party.

However, so far the issue has not been raised in cabinet and several sources have told SmartCompany new small business minister, Kelly O’Dwyer, does not support an effects test.

The final decision on whether or not to introduce an effects test will lie with Treasurer Scott Morrison after competition reform was moved from the small business portfolio to Treasury.

Former small business minister Bruce Billson supported competition reform, including the effects test proposal put forward by the Harper review.

New Greens Senator Nick McKim, who recently took over the party’s small business portfolio from Peter Whish-Wilson, says he is disappointed Labor does not support the effects test but remains hopeful the Coalition will push through changes that will better protect small business from unconscionable conduct by bigger competitors.

More than 600 small business owners have signed SmartCompany and the Council of Small Business of Australia’s petition calling on the government to implement the effects test.

“Our position hasn’t changed,” McKim says.

“We’ve long advocated for the introduction of an effects test. I’m disappointed to hear that Labor’s small business spokesperson, Michelle Rowland, doesn’t support changing Section 46 of the Competition and Consumer Act – but we stand ready to work collaboratively with the government on this issue.”

McKim says he hopes the Greens and Coalition can work together on the effects test in the same way they worked together on the recent amendments to unfair contract protections which are due to be passed by the House of Representatives shortly.

“The results on the unfair contracts amendments shows how working collaboratively can deliver good outcomes,” he says.

“This week the government has announced they’ll be supporting the amendments successfully moved by the Greens to increase the coverage of the small business and unfair contracts legislation.”

While the Liberal and National parties are traditionally seen as the natural allies of small business owners due to their pro-business and anti-red tape agendas, the Greens are slowly gaining support among small business people.

Around 12% of self-employed people vote for the Greens, according to the nation’s peak body for small business.

This is up from previous years thanks, in part, to the work of people like Whish-Wilson, who is a small business owner.

The Greens also snapped up traditionally conservative-held seats in the recent New South Wales and Victorian state elections.

As for what small business people can expect to see from the federal Greens in the lead-up to the next election, McKim says the party will be looking to plug the “gaps in support frameworks” the government currently has for entrepreneurs.

In addition, McKim says the Greens agree with Bill Shorten’s proposal of cutting the corporate tax rate for small businesses by 5%.

“We’d be looking at doing more to encourage risk-taking and investment in venture capital,” McKim says.

“I’m far less interested in political positioning than I am in delivering outcomes. “When you’ve got a commonality across the overwhelming majority of the parliament, as we seem to have developed in this space, that will only be a good thing for people out there taking significant financial risks investing in startups and small business.

“We will be releasing a suite of policies as we move towards the next election that will contain further tax cuts and incentives for startups and small business.”

 

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Broede Carmody

Broede Carmody is a former senior SmartCompany reporter. Before this, he was a co-editor of RMIT University's student magazine Catalyst.

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