LYING SCUM

This article by Robert Gottliebsen is worth the time it takes to read if you are in small business
"I NEVER INTENDED MY BUSINESS FACEBOOK SITE TO BE USED FOR POLITICS BUT THE LIBERAL PARTY
HAVE RIPPED US OFF, LIED TO US AND NOW ALL SME OPPORTATORS SHOULD SEE THEM AS LYING SCUM"
Gavin Waring CEO
The 7-Eleven affair could hit the Coalition at the next election
ROBERT GOTTLIEBSEN. Business Spectator. 11 Sept 2015
This is one of most ironic stories I have ever related to readers. It is also one of the most important because it may change
the government.
The chief executive of 7-Eleven in Australia, Warren Wilmot, this month stood down as chairman of one of Australias most
successful lobby groups, the Franchise Council of Australia after only eight months in the job.
Given the publicity about the 7-Eleven franchise agreements, standing down on the eve of the Four Corners program made
sense. There was a lot of work required at 7-Eleven.
But in those short eight months Wilmot was one of the most brilliant chairmen the Franchise Council has ever had. He faced
the daunting problem that Prime Minister Tony Abbott had made a landmark pact with the small business community that
the consumer protection against unfair standard contracts would be extended to small enterprises. It was an unqualified
promise and won him a lot of votes because it delivered the support of the small business community.
For many franchisors who were members of the Franchise Council, this was a horror promise from the Coalition because
there is little doubt that many of them might find that their standard unnegotiated contracts would be declared unfair.
If the Four Corners/Fairfax media research by Adele Ferguson is correct -- and I am not in any way doubting it -- then the
standard contracts put out by Wilmots 7-Eleven might be one of those declared unfair because they made it impossible for
many franchisees to make a profit without using low-cost labour.
Indeed thats exactly what former ACCC chief Allan Fels concluded on the program. Fels is now heading the 7-Eleven
inquiry into its contracts. The Allan Fels I have known for a long time will honour his word and recommend changes to
make 7-Eleven contracts fair -- exactly what would have been required under the Abbott fair contracts promise.
The main aim of Wilmot, as head of the franchisors lobbying body was to have any unfair contracts legislation dropped by
the Coalition or thrown out of the Parliament. But just as powerful an achievement would be to have the legislation made
absolutely useless by strategic clauses.
There is no doubt that Wilmot and his franchise council played a big role in having the Coalition limit the impact of the
unfair contract legislation to contracts under $100,000. That meant that just about every franchise contract escaped the
legislation because the bill was prepared so anyone can avoid the jurisdiction of the legislation by making the contract long
enough to reach the $100,000 limit but allowing the franchisor to end the contract at short notice. It made the legislation
totally useless.
Obviously the Wilmots franchise council was not the only lobbyist working to make the legislation nonsense, but it was
clearly a big player.
Indeed, at the Senate inquiry into the legislation the former Franchise Council chairman and a legal adviser to franchisors,
Norton Roses Stephen Giles, made a submission. I should add that our system is set up so people can lobby their case and
they are encouraged to do so.
These days, Liberal politicians in Canberra are scratching their heads wondering how they moved from being the heroes of
small business to the enemy and how they came to break a solemn promise at the behest of 7-Eleven and associated groups.
The man who was the small business hero, Bruce Billson, is now discredited and the small business community has launched
a vigorous social media campaign against him in his electorate. He will now receive the full wrath of 7-Eleven. The early
results of the campaign have been staggering and he is unlikely to hold his seat at the next election.
All the Coalition members who have seriously studied the legislation know they have broken a promise and deserve to be
punished by voters. But they are only now realising that in the 2016 election campaign they will get caught up the in the 7Eleven affair.
The Coalition is comforted by the fact that the ALP has never taken much interest in small business. But there are huge
numbers of voters involved and if Opposition leader Bill Shorten did get interested it would make the Coalition even more
vulnerable and could lead to a catastrophic defeat.
Kevin Rudd originally devised the fair contract extension to standard negotiated contracts to small business. I dont know
who led the lobbying that caused Rudd to drop the idea but almost certainly the big franchisors played a role. So if Shorten
does decide to back small entrepreneurs then no doubt franchisors will be knocking in his door just as they did to Kevin
Rudd and Tony Abbott. Meanwhile all sections of the media will now be watching for any money that can be linked to
franchisors that is paid into campaign funds of either or both major parties.
The unfair contracts legislation and its nonsensical clauses come before the Senate next week.