26 April 2024
1300 794 893
Pexels Image/Yan Krukov

Do our politicians take business seriously?

Peter Switzer
14 February 2022

Here’s a test for all Australians to see if our politicians take business seriously. OK, are you ready? Who’s Australia’s small business minister? And if I want to make it really hard, what about your state’s small business minister?

These questions came to me as I tried to understand why a Brisbane-based business has decided to move to the US, with the CEO complaining that government policies were better in the United States than locally. But worst of all, this is a business in the explosive growth sector of electric cars! More on that later.

Here's the answer to my question: Stuart Robert is the Federal Small Business Minister. If you live in NSW, the minister is Elena Petinos, but she gets off the hook for being unknown because she has just started. The pollie before her should be memorable but I bet not many in NSW would know who it was, and that’s because he didn’t make a big song and dance about his portfolio.

I won’t name and shame him.

In all my years, a number of small business ministers fought hard to let us know about what they were doing for small business and they became memorable. Labor’s Chris Schacht in the Hawke Government was very pushy for small business. Joe Hockey was very committed to the task of encouraging small operators and ended up as Treasurer for his commitment.

And then there was Bruce Bilson in the Abbott Government, who was also very publicly committed to his job until he lost out with the Turnbull takeover of the Government.

Significantly Bruce was named as the Australian Small Business and Family Enterprise Ombudsman in March last year.

Industry ministers should also be well known because they have big impacts on sectors of the economy and I wonder how many Aussies know Angus Taylor is the Industry Minister? Angus is copping the blame for a progressive firm, Tritium, leaving Brisbane for Tennessee, which will mean 500 jobs for that US state and 30,000 electric-vehicle fast chargers a year will be pumped out in that economy rather than in Queensland, Australia!

Let’s put the exit of a potential significant exporter into context by asking and answering a few questions.

Why did Tritium leave?

CEO Jane Hunter says a lack of government incentives and Australia having one of the worst electric vehicle uptakes in the world.

What is our uptake for electric vehicles?

Electric cars only represent about 1.9% of the light vehicle market but in Europe, electric cars are about 11% of new sales and the number is 10% in the UK.

Why the low uptake?

“So 1.9 per cent is one of the worst rates of uptake in the developed world, certainly behind G5 nations, and that’s because we haven’t had policies,” Ms Hunter told the SMH. “So it’s not subsidies, but you do have to have policies that favour EV [electric vehicle] uptake, and that could be as simple as offering great parking, not increasing taxes until you’ve reached the percentage target that you want to reach, and frankly, just telling the public that you’re now buying a piece of obsolete technology and that the tech has moved on.”

It's policy failure, which contrasts with what Joe Biden is doing in the space.

The US President, who’s often mocked by his critics and rivals as “Sleepy Joe”, wasn’t snoozing when he set a big target for half of the vehicles sold in the US to be electric or plug-in hybrids by 2030. “President Biden’s transport electrification policies have contributed to enormous demand for Tritium’s products here in the US - and that directly led us to pivot and change our global manufacturing strategy,” Hunter said earlier during the announcement at the White House.

And one has to wonder if more should have been done to keep a business of such potential here?

With coal and other anti-environment businesses likely to be rejected by consumers, voters and big stock market investors such as industry super funds, our governments — Federal and state — have to be switched on to what potential businesses could not only be exporters but also job creators.

In December last year, the SMH revealed how the Federal Government got its rapid antigen tests strategy wrong and it was a case of picking the wrong ‘horse’ in the Coronavirus testing race!

“Federal and state governments’ decision to fully back PCR tests instead of Rapid Antigen Tests (RATs) to detect COVID-19 infections in the early stages of the pandemic forced local manufacturers to sell their products overseas, leaving Australia now scrambling to secure supply,” the SMH revealed.

“Melbourne-based Lumos Diagnostics executive chairman Sam Lanyon said the company participated in discussions about the local manufacture of RATs in Australia with government representatives in mid-2020, as part of a federal government initiative to improve sovereign manufacturing capabilities. However, the talks ultimately proved fruitless.”

So should the governments of Australia get in the ‘picking winners’ game? History says no but it has never been done properly here.

Israel has gone out of its way to create it and Forbes.com explained how successful government efforts have been to build a tech industry there: “According to a recent report by Israel's IVC Research Center, Israeli tech start-ups raised a staggering $17.8 billion this year, almost double the 2020 total amount of funding in 2020 with one more quarter still to go...”.

A fair dinkum group of business builders/entrepreneurs, both current and retired, should be recruited to help politicians pick winning businesses. And sensible incentives should be created, as well as measurable tests on the results should be instituted to make sure we don’t invest in white elephants.

The great business creators in history have dreamt outside the square and have often asked: “What if the opposite was true?” When it comes to the observation that governments aren’t good at picking winners, maybe we should ask: would the opposite be true if politicians were actually guided by people like Mike Cannon-Brookes of Atlassian, Jane Hunter at Tritium and even though he can be hard to control, Fortescue’s Andrew “Twiggy” Forrest?

When it comes to the race to create new future industry winners, it has to be horses for courses if you want a great dividend. It can’t be politicians having a punt on businesses that often are driven by vested interests.

Comments
Get the latest financial, business, and political expert commentary delivered to your inbox.

When you sign up, we will never give away or sell or barter or trade your email address.

And you can unsubscribe at any time!
Subscribe
1300 794 893
© 2006-2021 Switzer. All Rights Reserved. Australian Financial Services Licence Number 286531. 
shopping-cartphoneenvelopedollargraduation-cap linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram