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From the Desk of the Executive Director

Ken Phillips is co-founder and Executive Director of Independent Contractors of Australia. He is a published authority on independent contractor issues and directs research on related commercial and trade practices issues. Through his numerous articles in newspapers and think-tank and academic journals, Ken is known for approaching issues from outside normal perspectives and is frequently sought out for media comment.

Unwinding Shorten's red-tape assault

Thursday, September 29, 2011

In a major speech on Labor's future earlier this month, Prime Minister Julia Gillard outlined a renewed vision for the party. At the heart of her message was a call to embrace individualism within the traditional framework of Labor's commitment to collectivism. But while her words were encouraging, the prime minister must now 'walk the talk'. Specifically, she must lean on her assistant treasurer, Bill Shorten, to stop the push to employ the tax system against contractors.


In the modern Labor Party, it's rule of the collective by the elites. And the elites have no longer risen from the shop floor. Instead they have come to power through family and political patronage. They have lost the common connection with and understanding of ordinary workers. Too often, they display a belief in their own power over that of the workers.

This is where Labor is often so angry towards and aggressively discriminates against self-employed individuals. They see us as traitors to the collective cause.

However, in her speech, Gillard sought to embrace the self-employed. Her words were refreshing. She said "... helping people to be their own boss, is part of the dream of working people too." She described the new Labor mission as one in which "... the power of collective action ... is joined to meaningful individual empowerment."

What Gillard did was not to reject collectivism but rather to expand Labor's idea of working people to include those of us who are our own boss. But this is a great challenge for Labor, one it has been struggling with since Mark Latham identified that Labor cannot be effective without the self-employed.

Labor has come to recognise that Australia's 2.1 million self-employed people have become too large in number to ignore. We outnumber union members. But Labor's frustration is our refusal to be drawn into the collective---at least, into a collective that's controlled by elites.

But the question is, does Labor truly want to embrace the individualism of the workforce? Will Labor's deeds match Gillard's political pitch? Here the recent history is not good.

Since the sacking of Kevin Rudd, federal Labor has demonstrated a mindset of attack against self-employed people. Labor's institutions have initiated a campaign against alleged 'sham contracting'. The hunting out of illegal underpayments is being used as an excuse in a broader campaign to suppress the right of individuals to be their own boss. It's insidious and cunning. Once the self-employed community were naive about these scam campaigns. Now we see them for what they are.

In this respect Gillard should, for example, look to bring her assistant treasurer, Bill Shorten, to heel in his persistent campaign to use the tax system against self-employed individuals. This started with the campaign on the personal services income tax laws, where Labor sought to deny self-employed people business tax rights. After negative publicity it stopped. Then Labor opened a new assault through the imposition by the tax office of massive red tape reporting requirements on construction contractors.

The forcing of small business people to be the government's paymasters in the administration of paid parental leave further demonstrates the government's disconnect from Gillard's words. For Labor, if a self-employed person happens to employ someone, Labor is insistent in imposing on them administrative (collective) responsibilities. Again, Labor elites are imposing their will.

Yes, some things are good. Labor's stated intention to improve dispute resolution for self-employed small business people is positive. But so far, real action is entirely at the state level with the roll-out of Small Business Commissioners' offices.

Further, it cannot be forgotten that last year Labor reneged on the plan to make unfair contract protections available for small business individuals, as was done for consumers.

It was good to read Gillard's words. Labor can progress if it comes to realise that in a fair and just society, the collective is only legitimate if it serves the individuals who make up the collective. This is not something Labor must simply talk about. It requires hard action to be believable.
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