Nikki Mandow joins the ACT Party campaign bus in South Auckland to talk about SMEs, success and life on the road.
Chris Baillie is a small business owner. He and his wife own the Honest Lawyer pub and hotel in Nelson. They employ 30 people.
And he’s grumpy with the Government.
“Business is a hard slog. It’s been particularly tough over the last three years and it’s getting worse.
Putting up the minimum wage. Adding five days of paid sick leave and a new public holiday for Matariki, scrapping the 90-day trial for larger businesses, offering a wage subsidy, but no help for owners meeting trying to meet rent and overhead payments and deal with their landlords.
“People are struggling and they don’t feel supported. I get sick of being told businesses were looked after with the wage subsidy.”
The wage subsidy looked after staff, he says. “It was in effect a benefit.”
It didn’t look after business owners. And “if employees are to have a job to go back to”, they need help.
Of course, it’s Baillie’s job to be tough on the Government. As well as co-owning a pub, and being a special needs teacher at Nelson’s Nayland College, Baillie is the new ACT Party candidate for Nelson.
Since August 10, except when stopped by Covid-19 lockdown, Baillie and his colleagues have been out on the ACT bus, travelling the length of the country to deliver the party’s “Change your Future” message.
Seven of the top 10 ACT list candidates are small business owners, and the party is playing that card with potential voters.
We know your pain, they say.
“Someone like Andrew Little, he’s a union man. He doesn’t think like someone who has owned a business. The Government doesn’t understand business is the backbone of the country.”
“My worry is people will trade up to Christmas to get the Christmas bump, and then we will see a lot of businesses closing up in January and February.” – Andrew Bayly
Still there’s some truth to what ACT is saying.
To someone on a salary, whether politician, journalist or other worker, an extra day’s annual public holiday is a ‘bring it on, no downside’ idea.
It’s pretty much the opposite for someone running a small business. New Zealand’s 12th public holiday, planned to start in 2022, leaves SME owners faced with another day with a wage bill but no revenue, or having to pay staff time-and-a-half to keep their businesses open.
That can matter a lot, particularly for companies struggling post the Covid lockdown, Baillie says. Particularly when it’s combined with a $1.20 increase in the adult minimum wage this year and another $1.10 next April, plus potentially another five sick leave days to pay.
As Auckland Chamber of Commerce chief executive Michael Barnett cuttingly suggested to Finance Minister Grant Robertson at a business breakfast that same morning: If you think those extra five days’ sick leave will be so good for New Zealand’s productivity and wellbeing, why doesn’t the Government pick up the tab?
ACT’s SME policies include freezing the minimum wage for three years, maintaining the status quo with holidays and sick leave, reducing GST from 15 percent to 10 percent for 12 months, reforming the Resource Management Act, changing the depreciation laws to free up cashflow for businesses, and giving to employers half the money now given by Government to polytechnics and training organisations for apprenticeships.
“Small businesses are increasingly frustrated at the Government’s lack of understanding,” Baillie says.
SMEs at a glance
SMEs make up 97 percent of all New Zealand companies and just over a quarter of our GDP. They employ nearly 600,000 people.
Courting the small business vote is as hot a topic as any for this year’s election. The same day ACT was wooing voters in Pukekohe and Robertson was addressing breakfasters in Auckland, small business spokespersons Stuart Nash (Labour) and Andrew Bayly (National) were fighting it out virtually at a Wellington Chamber of Commerce Zoom event.
“With New Zealand now officially in recession, having just had the largest quarterly fall in GDP on record of 12.2 percent, the recovery of small businesses is critical for New Zealand’s overall economic recovery,” the spiel said.
“We will hear what both major parties policies will do to support small business to get through COVID-19 and recover.”
Nash promised more interest-free loans, lower merchant service fees, provisional tax changes, and $2500-worth of vouchers for any business wanting to improve their digital literacy.
“If 20 percent of our companies used cloud technology, we would increase our GDP by $6 billion,” he told the online audience.
Bayly promised JobStart, an emergency programme giving a $10,000 cash payment to any business taking on a new permanent full time worker between November and the end of March.
He also outlined the BusinessStart package, a range of emergency measures for people who have lost their job due to Covid and want to start a business. It includes allowing them to take $20,000 out of their KiwiSaver fund.
“My worry is people will trade up to Christmas to get the Christmas bump, and then we will see a lot of businesses closing up in January and February,” Bayly said.
The ACT campaign trail
Friday: it must be Franklin.
The ACT bus tour is entering its last few days. I join the candidates in South Auckland, on their way down the country to the capital. The bus is smaller than I expected; a minibus as opposed to Winston Peters’ or Donald Trump’s more extravagant affairs.
Today’s ACT candidate crew is made up of five other prospective MPs besides Baillie (list rank 4). There is Simon Court (list rank 5, civil engineer standing for Te Atatu); James McDowall (list rank 6, immigration law firm owner and NGO worker, Waikato); Karen Chhour (list rank 7, self-employed mother of four, Auckland’s Upper Harbour seat), Dave King (19, Port Waikato), and Mike McCormick (Takanini).
The day’s business includes an event in the Franklin Club at Pukekohe, a walkabout at the Manukau mall, then drinks and a political discussion at the Urban Soul Cafe in Karaka.
I reckon it must be exhausting – and maybe a bit annoying, delivering the same message day after day. Several times a day. Answering questions from small audiences. Being relentlessly positive about your chances, combative about the Government.
The five candidates on the stage make up not far off a quarter of the people in the hall. There are 14 people in the audience excluding me – but including an unexpected visitor, early ACT Party supporter and two-time ACT MP Owen Jennings. He lives locally and has come along with his wife to chat to the newbies.
Apparently it isn’t unusual to see ACT stalwarts Richard Prebble or Roger Douglas lurking at the back of the room when the bus is in their neck of the woods.
The candidates don’t appear daunted by the thinness of the crowd. They are probably used to it.
They stand up in turn, explain who they are, why they joined the party, what they believe in. It doesn’t sound like rote, though they have presumably said the same thing dozens of times.
They answer questions. There’s a guy worked up about the “craziness” of the Government’s policy of aiming for 100 percent renewable electricity and the “uselessness” of wind turbines. Court tells him ACT would reverse the moratorium on oil and gas exploration.
There’s a woman worried about “children being in charge at school”. ACT is a strong supporter of charter schools.
There’s talk about increasing productivity, reforming the RMA, introducing vouchers for welfare recipients, and giving more money to companies who take on apprentices.
Then it’s time to be off. Not even a cup of tea, though apparently there are healthy, energy-replenishing snacks on the bus.
I ask for a photo in front of the bus. Karen Chhour says it’s the first time they’ve done that. That’s kinda sad. The candidates joke and jostle in front of their photos on the side of the bus.
They say they are enjoying the campaigning experience, that they believe the message.
That’s perhaps not surprising. For ACT’s aspiring MPs there’s the excitement that comes from being part of a party on the up and up. ACT was pretty much written off at the 2017 election, receiving less than half a percent of the vote, an even worse performance than the 0.7 percent in 2014.
Both times the party was saved only by Epsom MP and leader David Seymour.
In 2017, NZ First got 7.2 percent and nine MPs, the Greens 6.3 percent and eight MPs.
How things have changed.
The most recent TVNZ Colmar Brunton poll showed ACT on 8 percent, the Greens on 6 percent, and NZ First languishing at 2 percent.
That could give ACT up to 11 seats in Parliament, including many of the hopefuls in Franklin.
(For more background on ACT’s top 15 list MPs, check out this story by Newsroom Pro’s managing editor Jonathan Milne.)
Eight percent would be the party’s best result since it was founded as the Association of Consumers and Taxpayers by Roger Douglas and Derek Quigley in 1993.
Saving the unsave-able
So what happened?
Right of centre blogger, pollster and political commentator David Farrar says David Seymour took over the ACT party after the 2014 election at a time when the party seemed unsave-able.
“The brand was terrible, the headlines were terrible.”
Farrar recalls the so-called ‘teapot tapes’ (recorded discussions between then Prime Minister John Key and then ACT candidate John Banks in a cafe), the open hostilities between party leaders Rodney Hide and Heather Roy, Banks being convicted of filing a false electoral return around donations from internet mogul Kim Dotcom. (He was later cleared.)
“I wrote a column in the Herald saying ‘They are dead’. No one wanted to admit voting for them,” Farrar says.
In the last six years the brand has changed, he says.
“Seymour is likeable and has avoided the controversial stuff, particularly around the Treaty.”
Instead he’s run with some high profile issues like euthanasia, steering a bill through Parliament virtually single-handed at the start.
Seymour also picked up support after the Christchurch terrorism attacks from gun enthusiasts angry at where the Government went with its gun control laws, Farrar says. Many would have been NZ First supporters.
And ACT has gained popularity with Seymour’s pro-free speech, anti-cancel culture stance.
“Eventually, the leader’s brand becomes the party’s brand. Once you get over 2 or 3 percent, you are no longer irrelevant and then momentum starts to kick in.”
Then there’s Covid. ACT has been virtually the only party standing up against the Government’s “go hard, go fast” lockdown stance.
“Eighty percent of the country likes what the Government has done with Covid, he says. But ACT is the only one saying what the other 20 percent believe.”
“It is not affordable to continue with rolling lockdowns,” the party’s website says. “Being free of Covid-19 is one dimension of wellbeing. We also have to think about … the mental health of small business owners run ragged, non-Covid healthcare such as missed elective surgeries, and families who can’t travel to Auckland for funerals.
“Then there are financial costs. If we take one estimate from a major bank, a Level 3 lockdown in Auckland costs $440 million a week. 16 days is $1 billion. That is Pharmac’s entire budget for all taxpayer-funded medicine for a year.”
“In addition to the cost of lockdowns, New Zealanders face the uncertainty generated by the threat of them. Who would invest in hospitality right now? Who would invest in events? Better wellbeing depends on investment in the future, but investment requires certainty, and the lockdown strategy imposes massive uncertainty on everyone.”
This attitude has won ACT some support, Farrar says.
Eighty percent of the country likes what the Government has done with Covid, he says. But ACT is the only one saying what the other 20 percent believe.”
“If you are a 2-3 percent party, 20 percent is great to aim for.”
Courting the entrepreneurs
Entrepreneurs are a natural fit for a party trying to reduce rules and cut taxes.
“The answer is not more regulation,” Simon Court tells the Franklin Club gathering. “It’s letting individuals and businesses innovate.
“We are the voice of common sense. I trust you to have the answer to solve your problems.”
Give us your party vote.
When the ACT bus leaves for the walkabout at Manukau mall, I collar Chris Baillie. He’s flying back to see his family in Nelson for the weekend, before returning to the trail on Monday. There are a few minutes before he heads to the airport.
What have you been hearing from SMEs as they move around the country? I ask.
As you would expect, Baillie says they are doing it hard.
He remembers meeting the owners of a small cafe. Since the end of the wage subsidy in early September they have been forced to lay off their three staff and run the business alone – working long hours, seven days.
There’s the Otaki clothing store quoted $10,000 to modify its systems to make click-and-collect possible and protect them in a future lockdown. The problem: turnover is only a tiny fraction of that.
Or the Christchurch man who owns three coffee carts and a cafe. “He wants to employ two more people, but he’s too scared because of the minimum wage going up, and the Greens throwing around comments about more taxes.
“It’s the uncertainty.”
The 90-day trial period
Then there’s Baillie’s own experience as a special needs teacher.
“Scrapping the 90-day trial period [where companies take on staff for three months without any concerns about having a case of unfair dismissal taken against them if they don’t take them on permanently] is an impediment to growing businesses,” Baillie told the audience.
It also makes it difficult to transition hard-to-place students into jobs, he says.
“The 90-day trial gave employers the ability to take on people who might be a bit risky, who didn’t look quite right, to give them a chance,” he says. Students with disabilities, or former prisoners.
“ACT would reinstate it,” Baillie says.
It is a strong argument, and only a tad disingenuous. The 90-day trial wasn’t scrapped altogether by the Labour Government last year, just changed so it was available only for companies with less than 20 staff.
Essentially it restored the law to what it was when trial periods were first introduced in 2011. Still, around two thirds of people work for companies employing 20 staff or more.
The show goes on
I leave the ACT bus at the Manukau shopping centre. The candidates have walked around trailed by security guards, stymied by Westfield rules which stop them approaching shoppers uninvited, going into stores, or being anywhere near the poling booth.
That’s OK, James McDowall tells me, it’s all about getting your brand out there.
The group are off to Karaka now, for a “relaxed discussion about politics and the 2020 campaign”.
I admire their stamina. I decline their invitation.
I tell them I’ve enjoyed my day – and I have.
I may not agree with them on all their policies, but on small business, I come away more convinced by their rhetoric than I was by that of Grant Robertson, Stuart Nash or Andrew Bayly earlier in the day.
A lot of these ACT candidates are running or have run small businesses – and it shows. They understand what it’s like to live month-to-month, to struggle with cashflow, with compliance; to have to make difficult decisions some months whether to pay their tax or their staff.
They get that a seemingly little thing like an extra public holiday can have big consequences, particularly when times are tough.
And I suspect they may be right: most of our other politicians just don’t understand.