Andrew Dickens: Both sides of Parliament need to find answers for small businesses

Author
Andrew Dickens,
Publish Date
Wed, 29 Apr 2020, 1:24PM
(Photo / NZ Herald)

Andrew Dickens: Both sides of Parliament need to find answers for small businesses

Author
Andrew Dickens,
Publish Date
Wed, 29 Apr 2020, 1:24PM

So the pressure cooker that our businesses have been in due to our response to Covid 19 yesterday exploded.

It was the turn of small business to appear before the Pandemic Response committee and it was a heartbreaking litany of broken hopes and dreams from the sector that employs a quarter of all New Zealanders.

Amongst all of them, there was a commonality.

Ever since we closed our borders, which killed hospitality and accommodation, and then the lockdown, our small businesses have experienced a dramatic reduction in cashflow that will be fatal for many enterprises.

The committee heard that while the government’s wage subsidy has helped them meet one of their liabilities, namely paying the people who do their work, there are many other costs that are sucking their reserves dry.

They’ve got no money coming in but they still face debts around rates, insurance, rent, utilities, equipment leases, and all sorts of other business costs.

They’re going to the wall and they want the government to do something about it.

In their grief, many small business owners believe that the rest of us and the government don’t understand their plight.

Can I assure small business that we do.  That we care.  But the thing we all need to know is what should we do and what do you need.  Our problem is that we've hit a wall and no-one knows what to do

So, this morning Stuart Nash and Mark Mitchell faced off about it.  Nash is the Minister for Small Business. Mitchell ran through the pain our small business is feeling and then made the blindingly arrogant assumption that the Minister of Small Business has no idea how small business is feeling.

I’m pretty sure Nash has been yelled at by enough small businesses to know how they’re feeling.

Mitchell’s sweeping assumption is part of a common complaint against the Coalition.  They’re academics and have never run businesses.

Well ,I don’t know whether you watched yesterday’s committee but the best questions came from Tamati Coffey.  He is a small business owner.

Take our current Minister of Economic Development and Trade David Parker.  He’s been involved in starting the bio-tech export start-ups A2 Corporation, BLIS Technologies, Botryzen and Pharmazen. He is an experienced CEO and company director.

Compare that to Paul Goldsmith who in an alternative world would be Finance Minister now. He’s been a press secretary and speech writer for Phil Goff, Simon Upton and John Banks  In 2000 he got into PR and worked for Tranz Rail and the University of Auckland.  For three years he was an Auckland City Councillor. He’s got an MA in history.  You can say he had his own business.  He wrote 10 books. He’s basically a writer and a spin doctor.

People in glass houses shouldn’t throw stones.  Based on a lot of the aimless questions from our parliamentarians from both sides I would say lack of business acumen is widespread in parliament.

What really bugged me about this morning’s debate is how short it was of ideas.

Nash tells us somethings coming next week.  They better hurry up because temperatures rising.

Meanwhile, Mitchell runs through the story of a laundromat operator who’s business has dropped 70 per cent since in the pandemic who sits in his office with his head in his hands.  But never says what he thinks we should do.

And I tell you why.  Because the Mark Mitchell and the Opposition don’t know either.

70 per cent of the laundromat’s business came from doing motel and hotel laundry.  That business is gone until borders are opened and domestic tourism restarts. He could borrow money from a bank with a 20 per cent guarantee from the government.  But the bank would take a look at the business and its prospects going forward and say you model is shot so we don’t want to lend you money.  Harsh but true.

So what did Mark Mitchell want Stuart Nash to do.? Throw government money at a failing business so it fails a few weeks later than it already would? Is that an efficient use of taxpayer funds?

Should the government be paying compensation to the Laundromat owner because the lockdown unilaterally destroyed his business so he can start again with a better model?  If they do that David Seymour will be up at arms at government’s picking winners.  There’ll be big grumbles about corporate welfare.

These are big tough calls.  Mitchell made none of them.  Neither did Nash. Give us a break.  We’re not stupid. We all know the problem.  What we really want is the answers.