Self Employed Australia

"Everyone needs an Advocate"

“Everyone needs an Advocate”

Self-employment

Is your superannuation money safe? Morrison v Albanese

by Leave a Comment

super-safeIt’s the final run to election day and it’s anyone’s guess as to the outcome!! We’ve put out several news alerts comparing Labor and Coalition policies. We’ve sought to highlight the policy facts affecting self-employed people. Here’s our final pre-election analysis.

Last Sunday Scott Morrison made a big pitch with a new housing policy. It’s a pitch to first-home buyers. Morrison announced that if he retains government, first-home buyers will be allowed to dip into their superannuation money to boost a deposit. His theme is ‘it’s your money!’

Our comment, however, is on a broader issue affecting everyone with money in the big superannuation funds, including self-employed people. This issue shows a stark difference between Labor and the Coalition.

Do superannuation funds present a risk?

Incredibly, up until now, super funds—particularly the union/employer association-controlled Industry funds—had few if any legal requirements to be public about how they manage your superannuation money.

Compare this to listed companies, particularly banks. Banks have strict disclosure requirements. Heavy penalties apply if the banks breach these laws. Disclosure means that government, the media, financial analysts and so on can keep a close eye on the banks, not just from a performance perspective but also in terms of the key question of whether deposits are safe.

Superannuation funds have effectively faced none of the disclosure requirements that apply to the banks. We know this because of a review into superannuation (The Cooper Review) conducted by the Labor government in 2009. The global audit company Morningstar said in its submission to the Review:

Australian superannuation scheme providers and fund managers currently have a mish-mash of approaches to holdings disclosure … Superannuation and managed funds disclosure in Australia is also poor when compared with the extensive mandatory disclosure requirements for listed securities …. Regular, comprehensive holdings disclosure would also provide greater opportunity for detection of undesirable behaviours…

Neither APRA nor ASIC appeared to undertake any form of direct auditing. APRA only reported what the super funds reported, saying it took no responsibility for the data reported.

The Cooper Review recommended major changes to require disclosure. But Labor chose to ignore these, and nothing was done.

Last year the Morrison government pushed through laws that force superannuation funds to disclose how and where they invest your superannuation money. These laws took effect in March this year. Labor, along with unions and the industry superannuation associations, strongly opposed the new disclosure laws and actively sought to block them. More disclosure requirements are needed.

There is now $2.3 trillion in the big Australian superannuation funds. It is extremely concerning that Labor would oppose complete and major disclosure requirements. As Morningstar stated in 2009, without proper disclosure there is always the threat of ‘undesirable behaviours’.

Morrison’s dead flat small business pitch

by Leave a Comment

election-2022-pitchLast week Morrison made his pitch for the small business vote. It fell dead flat. That’s strange really.

It’s almost an Australian political truism that political parties cannot win government in Australia without a sizable chunk of the small business vote. So, for Morrison, who’s supposed to be ‘Scotty from marketing,’ his seeming blindness to this alleged truism is odd.

Morrison’s pitch was that by lowering overhead costs and energy bills he’d create a vast number of new small businesses. This pitch is not specific and applies generally to any business (or family) in the economy. There’s no ‘joining of the dots’ between the pitch and the lives of the self-employed, small and family businesses.

Again, it’s strange that Morrison has totally missed his small business target. The Coalition in fact has a substantial history of not only spouting the small business mantra, but of having substance to support the mantra as well. Take some examples.

John Howard created the Independent Contractors Act to protect the status of the self-employed. Tony Abbott committed to the introduction of a Federal Small and Family Business Ombudsman and put the wheels in motion for unfair contract laws for small business.  The Abbott-era commitments were finalised and delivered under the Turnbull coalition government.

Self-employed, small business people profile strongly on the measure of informed and swinging voters. They are extensive seekers of information. This again is why Morrison’s dead flat small business pitch seems so strange at this election.

At the 2019 election Morrison promised to introduce security of payment laws for small business. He’s done this. And it’s good. It’s strange that he’s not pitching it.

He also promised to ‘beef up’ unfair contract protections for small business people. The Bill was ready to go. But strangely this major pro-small business Bill was deserted immediately before the election was called. Did the ‘big end of town’ get to Morrison to pull the Bill?

Then there is the elephant in the room. The Australian Taxation Office has been crucifying small business. The ATO has destroyed small businesses in the research and development space—claiming dodgy use of grants—but the ATO subsequently admitted that it was wrong.

The ATO has been attacking small and family business trusts, forcing trust beneficiaries to pay tax when (even the ATO admits) the beneficiaries have not received any income. The ATO has also sought to change trust distribution rules retrospectively, thereby creating tax debts in the past where, under then-existing ATO rules, no tax debt existed.

In the 2021 Budget the Morrison government declared in Parliament that “We are backing small business in over the ATO. No longer will the ATO be able to garnishee and takeaway (alleged tax debt) while the dispute is in train”. But this promise turned out to be false. The implemented policy only enables small business people to ‘apply’ to have a disputed debt ‘paused’ until appeals have been heard.

Morrison’s pitch to create large numbers of small businesses falls dead flat if those new (and existing) small businesses find themselves under unfair attack from the ATO without the protections afforded by a rule of law regime.

To win and retain the small business vote the Coalition has historically made a policy of substance that it then delivers when in government.  This time Morrison is not selling what he’s done and not promising anything new for small business.

It’s almost as if Morrison has abandoned the small business vote. How odd!

Albanese plan to smash Australia’s 2 million self-employed

by

election-2022-smashThere’s now clarity on what Albanese’s Labor intends to do to self-employed small business people if elected. Labor intends to attack us.

The ALP Secure Jobs Plan says:

“Labor will extend the powers of the Fair Work Commission to include ‘employee-like’ forms of work…” Labor intends to attack “…new forms of work such as gig work.”

Last Monday (2 May) this was further made clear at an Albanese street-walk rally in Brisbane. The Australian Financial Review reports from the rally that Labor will legislate to invent new law that says that self-employed people are a ‘little bit’ an employee, like being ‘a little bit pregnant’. It’s clear that the policy is directed at giving unions control over gig workers and any other self-employed person they choose to target. Hairdressers, for example!

The policy is a direct lift from the Californian law called AB5, introduced in early 2020. It was a job killer which hit the most vulnerable self-employed people. Think of single mums running their own transcription business from home! Closed down! There are thousands of examples.

The United Kingdom has an old 1986 ‘little bit pregnant/employee’ independent contractor law. This was used by the UK transport union in 2021 to attack gig ride-sharing. It’s thrown commercial contracts into chaos in the UK.

Albanese’s Labor says it wants to do ‘nice’ things such as giving ‘little-bit-employee’ self-employed people access to collective bargaining, superannuation and the minimum wage. But this is a beat-up.

Self-employed people (us) already have easy access to collective bargaining authorised under competition laws. Superannuation is clearly required when an individual, self-employed persons (not structured as a P/L company) works for a business. The Independent Contractors Act requires that independent contractors should not be paid less than employees.

The truth is that self-employed people are protected under commercial law regulations. Think of the unfair contract laws. Albanese’s Labor wants to drag us into the mess of union-controlled industrial relations law. Forget it!

And quite recently the Australian High Court reaffirmed that self-employed people operate under commercial law. The Court also stated that UK-type (little-bit-employee) laws are not part of Australian law.

Further, the International Labour Organisation, a United Nations body, declared in 2006 that national laws should not interfere in the commercial relationships of independent contractors.

The Albanese plan defies international labour rulings and secure (High Court-determined) contract law. It is a repeat of the disastrous Road Safety Remuneration Tribunal introduced by the 2012 Gillard Labor government. This ‘protection’ invention was about to destroy the businesses of 50,000 self-employed truckies before the Turnbull government abolished the Tribunal.

The obsession Labor has with the ‘evil’ gig economy is silly. Only 0.19 per cent of the Australian workforce earned their full-time income through gig work. But Labor is using a near-hysterical, anti-gig campaign as an excuse to attack self-employed people.

It’s clear that if Labor wins government, we (self-employed people) will have a big fight on our hands to retain our right to be self-employed. It’s about our right to decide how we want to earn our living and to control our working lives. Labor wants to attack that right.

Closing the construction watchdog will harm self-employed tradies

by

Unfair contract laws

In March we praised the Morrison government for moving to ‘beef up’ the unfair contract laws for small business people. Albanese’s Labor also supports this, which is great. Unfortunately, the Bill did not pass through Parliament before the election was called.

Integrity Commission – ATO

Labor has made a big noise about Morrison failing to establish a Federal Integrity (anti-corruption) Commission. Here’s our assessment of the issues and politics of this. Morrison has a model, but Labor wants one based on the NSW Commission. The NSW Commission is, however, accused of being a kangaroo court that the High Court found breached the law. The Morrison model would, for the first time, make the ATO accountable to an external body. That’s a policy we strongly support.

Industrial relations

Last week Morrison announced he would move on some industrial relations reform. Labor attacked and Morrison quickly reversed his stance. Here’s our assessment of the politics around this issue. Essentially, we say that the ‘big end of town’ wants changes to suit themselves. But we reckon that the ‘big end of towners’ are incompetent in managing their workplace relations.

Construction Industry Watchdog

If there’s one Labor commitment that stands out, it’s that an Albanese Labor government will close down the Australian Building and Construction Commission (ABCC).  We see this as highly negative for self-employed people in the construction sector. We strongly oppose this Labor policy.

Here’s our longer assessment, but in summary:

  • The ABCC has brought some discipline to the mafia-like behaviour of construction unions. Over the last two years the ABCC has had the courts impose fines totalling some $5.7 million for illegal (thuggish) behaviour.
  • What’s extremely important is that the ABCC operates a Security of Payments system in the construction sector. It’s a vital service. All construction firms within the ABCC’s jurisdiction are required to pay their subcontractors within payment terms. If they are late, they must report this to the ABCC. Subcontractors can lodge complaints with the ABCC over late payment.
    If contractors do not pay on time, they risk sanctions that ultimately include being banned from all Commonwealth-funded work. Over around the last 5 years the ABCC has recovered some $10.7 million in outstanding payments owed to subcontractors. Some major contractors have been disciplined.
    An external review of the ABCC reports a “reduction in the number of delayed payments” and “greater efforts being made to pay subcontractors on time.” This is critically important.

There’s no doubt that should Anthony Albanese’s Labor win the election, one of its highest priorities will be the elimination of the ABCC. The outcome would be renewed, unrestrained thuggery on construction sites. Further, small business tradie subcontractors would again carry the risk of not being paid. A bad outcome for all except for the thugs.

(Disclosure: Ken Phillips is a member of the ABCC Security of Payments Working Group along with representatives from the ACTU and Building Industry Associations.)

We’ll produce more election assessments on issues for self-employed people over the coming weeks.

ATO ramps up its aggressive campaign against small and family businesses

by

aggressive-campaignIt’s not extreme to say that the Australian Taxation Office is conducting a brazen financial bombing campaign against small and family businesses across Australia.

Last week we informed you about the ATO’s taking a position where, at law and in its administration, it can (and is) creating and imposing tax debts where the taxpayer has not received any income. It’s gobsmacking but the High Court has said that this is ‘legal’ even though it also remarked that it’s clearly unfair. This is happening with family businesses using trusts—but watch the ATO expand this agenda.

Now we have more news of the ATO’s small business destruction campaign. In February the ATO released draft rulings that would declare family trust payments to adults to be illegal. What? This throws out decades of accepted, legal, small/family business income distributions. It would be like declaring that dividends from public companies (eg Telstra, BHP, CBA) were illegal. But more! Such declarations were to be backdated to 2015. So distributions that were legal over the last eight years could now be declared illegal. This is small/family business-hating, ATO madness.

Then last week, just before the election was called, the government and the ATO issued a ‘sort of‘ backdown. Well, not really. The statement says they’ll still deny distributions but will not apply them retrospectively. In other words, the attack continues but not as bad ‘sort of’!

There’s more for us to report on this intensifying ATO small/family business tax ‘bombing’ campaign. More pressing at the moment, however, is the need for solutions to fix this destructive ATO behaviour.

Jason Falinski MP has been the greatest friend of small business in the Australian Parliament over the last few years. He’s been doing real stuff. Not simply talking.

Jason chairs the parliamentary committee that keeps watch on the ATO. He’s guided and pushed the review that’s come up with some common-sense, balanced ATO reform recommendations. At the heart of these is a legislated ‘Taxpayer Rights’ Act. We reported on this in October last year.

Taxpayer Rights would:

  • Ensure that the ATO could not collect a debt until all appeals have been finalised.
  • Reverse the onus of proof of fraud or evasion so that it lies with the ATO.
  • Establish the office of Taxpayer Advocate to ensure that the ATO complied with the Taxpayer Rights Act.

The ‘Falinski’ Report is a huge step forward for Australian small and family businesses in particular.

As we’re now in the full-blown election campaign period, we need to know from both Scott Morrison and Anthony Albanese where they stand on Taxpayer Rights. Frankly, it’s the critical issue for Australian small and family businesses.

If Scott Morrison and Anthony Albanese both remain silent on this issue, it really means that they both endorse the current anti-small business behaviour of the ATO.

Government gets massive tax windfall from Australians who have received no income. Bastards!

by

ATO-punchHow would you like to be forced to pay tax when you have received no income? That’s what’s happening to a taxpayer following a High Court ruling this week. And it’s happened because the Australian Taxation Office has the legal power to act like a ‘Mongrel Bunch of Bastards’—something it’s rather good at.

The case involves a legal interpretation of an obscure 1936 tax law affecting trusts. You might think that trusts are only used by wealthy people. But no! There are 900,000 trusts in Australia, used mostly by small/medium-sized family businesses.

In this particular case, the ATO ‘formed an opinion’ that a medium-sized family business made a (theoretical) profit in 2014. It’s a ‘theoretical’ profit because the ATO decided to ignore the business’s expenses in its assessment. That’s exhibit number 1 of ATO bastardry.

Because the business didn’t make any profit, the father who ran the business didn’t distribute any money to his daughter who was a ‘beneficiary’ of the business’s trust. Sounds sensible!  And the ATO accepts that no money went to the daughter. But the ATO decided that it would test the 1936 law in the High Court. (Bastardry exhibit number 2.)

On the strict wording of this obscure tax clause the High Court has ruled that, with trusts, tax must be paid even if no ‘profit’ is distributed. It’s a blatantly unfair situation.

But there’s a further stinger not covered in this High Court decision. That is, that under the general powers of the ATO, the ATO only has to ‘form an opinion’ of a profit having been made for it to become a legal ‘profit’ and hence creating a tax debt. And the debt must be paid immediately. Unfair! Unfair! Unfair!

The High Court’s job, however, is not to decide public (tax) policy but to rule on the meaning of the law. But in this case the Court nonetheless recognized the unfairness, saying that:

“That unfairness arises because Div6, and s97(1) in particular, is drafted to tax a beneficiary by reference to present entitlement, not receipt.”

Here’s the High Court’s ruling—see paragraph 26 (we’ve highlighted it.)

The ramifications of this ATO behaviour are massive. 900,000 people/businesses with trusts will now never know if the ATO will ‘form an opinion’ that they have made a profit and create from thin air a tax debt that it can enforce.

But how many other obscure tax clauses exist that the ATO might use to impose a tax debt where no income has been received?  We are all at risk from this ‘bastard’ ATO.

So who’s to blame for this mess? Doyen business commentator Robert Gottliebsen has said of this case in The Australian that, “Many tell me that the tax commissioner is ‘out of control’. I think the truth is different—the commissioner is ‘not in control’”.

Frankly, this is a terrible way to run a country. For more than a decade we (Self-Employed Australia) have been exposing ATO bastardry and calling for a fix. In early 2020 we offered a specific and detailed fix based on the rules the United States uses to control its tax authority (the IRS). What has the Morrison government done in response? Nothing that has made any difference. They have merely fiddled, while seemingly pretending to do something.

This recent act of ATO bastardry takes the unfairness of this fouled-up tax administration system to a new low. It could have been stopped with a decent government having rules to control the ATO (like the USA) instead of the ATO ruling over the government.

We’ll have more to say on this!

For goodness’ sake stop wearing those same pyjamas at work!

by

Are you one of those ‘work from home’ people who insists on wearing your favourite pyjamas nearly all day? Well, your choice of ‘comfort’ clothing is yours! But here’s a ‘think piece’ about your being a ‘revolutionary’ work-from-home worker!

Demographer Bernard Salt reports that Covid may have pushed ‘work from home’ workers from 5 per cent of the workforce to some 50 per cent. He expects, however, that figure to level out at around 15 per cent as a long-term trend.  Assuming he’s correct, this 10 per cent rise in the ‘work from home’ movement is a dramatic shift in the work environment.

This surge in the ‘work from home’ movement is almost certain to generate a major lift in the number of self-employed in Australia.

Having grasped this, let’s quickly dismiss the bleatings of CBD property developers. Their financial self-interest is on naked display as they worry about sunk and future financial investment in CBD office space.

Bernard Salt indicates that the bleatings can be ignored in any case because the natural increase in office worker numbers will rejuvenate CBD office space within a few short years.

But the bigger issues relate to workers’ lifestyle choices, the worker ‘liberation’ delivered by technology and the massive but un-recorded or un-diagnosed productivity boom embedded in ‘work from home’.

In its simplest form, the productivity boom is readily understood when considering home-to-work travel times. If ‘travel’ time from the bedroom to the home office is (say) two minutes, that utterly trounces the 1–2 hours many office workers spend traveling to and from a CBD site. The clear productivity increase is staggering. But because the direct benefit is to the worker and not directly to the ‘firm’, statisticians don’t know how to measure it. And office ‘bosses’ may then say, ‘if the firm doesn’t directly benefit, what use is this extra productivity?’

But there’s more.  Home office work challenges the management philosophies and practices underpinning the office environment of the last 50–60 years.

The advent of the ‘knowledge worker’ notion, well in vogue this century, has shifted perceptions about the office environment. Current thinking is that office workers need to have a framework for exercising individual judgment if productivity is to be increased. Enter the human resource professionals and their obsession with creating office ‘culture’.

This HR-driven idea is that If the (HR) bosses can create the right culture, workers will exercise individual judgement (but still within the boss’s controlled culture) and the firm will grab the productivity benefits. But that ‘control through culture’ has always been a line-of-sight exercise. If the (HR) boss can’t see the worker, where’s the control?

Working from home shakes those ideas up big time. For bosses it’s really scary. How do you ‘control’ the company culture when the home ‘office’ worker takes an ‘unauthorised’ break to do the ironing or pick up the children from school?  That’s the challenge at one level.

There are deeper institutional  challenges. Employee contracts are ‘industrial instruments’ modelled entirely on factory concepts. Worker remuneration is overwhelmingly time-based, regulated through archaic, ponderous quasi-courts.

Such institutional processes seek to regulate and control human interactions in relation to equal opportunity, discrimination and the like. Work safety laws are also predicated on a factory-style assumption that bosses (however defined) control everything and that therefore bosses must be responsible for any safety breaches.

But consider this example: How should work safety laws be applied if a home worker trips over the family dog and breaks an arm? Is the worker’s boss liable?  This is not a silly issue to consider. Precedent has already been set.

New tenancy laws in Victoria now require electricians to check and certify electrical appliances in tenanted homes every two years. So a domestic toaster malfunction is now the ‘fault’ of the landlord. Will work safety regulations move to require bosses to pay for and check electrical safety in home workers’ homes?

The point is that once people work from home, the idea of that person being a controlled employee becomes a nonsense. Working from home means that a person exercises self-control in nearly every conceivable way. This is the complete opposite of every institutional, legal and behavioural idea of the ‘employee’ worker.

But self-control is everything that being ‘self-employed’ is about. Being a ‘work from home’ worker is a natural fit with being a self-employed independent contractor.

But watch out for the responses of the HR professionals, the ‘controlling’  bosses, the CBD property developers and the many institutions that regulate the work environment. They are very likely to conduct major pushbacks.

Confronting bullies in our own (Australian) backyard – Unfair Contracts

by

bullyIn a world full of bullies, the ‘little’ person must have the power to stand up against aggressors. If bullies rule, our democracies, the rule of law, justice and fairness are simply empty, meaningless terms thrown around like useless confetti.

In Australia we are lucky to have a government and a parliament that are finally moving hard to stop big business bullies in their dealings with consumers and small business people.

There is a Bill before Parliament at the moment, ready to be passed, that gives real teeth to unfair contract laws. What might seem like technical change to obscure law known only to a few people is, in fact, a huge step for fairness in how the Australian economy works. Everyone is affected, even if few understand how.

Simply put, when this Bill becomes law:

  • It will be illegal for big business to have unfair contract terms in their standard form contracts with consumers and small business people.
  • Fines will apply to anyone who tries to push an unfair contract on to consumers/small business. (Up to $500,000 for individuals and $10,000,000 for corporations.)

The implications of this are massive. Businesses that want to screw over consumers and/or small businesses with unfair contracts will be forced to dump those contracts. (Think phone, internet, car and other equipment leasing, land sales and on and on.) This is a huge economic reform that will make for a fairer and stronger Australian economy. More people will be able to do business and buy things with real protections against unfair contracts.

For us, this journey started in 2009. At Self-Employed Australia we believe we played a pivotal role in making this happen—along with many others that we need to thank. The sequence of events was as follows:

A full timeline and details of the events is here.

There are many people to thank, reflecting the very best of the Australian parliamentary process and the public service:

  • The Abbot government committed to the laws for small business.
  • The ALP, Greens and Senate independents ensured that the laws had reasonable meaning.
  • SEA played a pivotal advocacy role to this point (2016) against opposition and dirty play by ‘big end of town’ types.
  • Rod Sims and the ACCC were champions in highlighting the weaknesses in enforcement and pushing for ‘beefing up’.
  • The Morrison government has worked through to ensure that the ‘beefed up’ laws are now before parliament.
  • The ALP, Greens and independents all seem clearly supportive of the new laws.

The ‘beefed up’ Unfair Contract Bill is now before parliament.

For the ‘big end of town’ lawyers who say that these laws break contract integrity, we reply as follows: The Unfair Contract laws embed or codify the ‘structural’ principles of commercial contract in statute. They ensure that standard form contracts have a measure of power balance such that they engender contract trust—that is, the contracts have integrity.

We do, however, have one major concern. Australian governments, state and federal, routinely break the unfair contract laws. They reckon they are exempt. And most often they are. We need all Australian governments to amend laws to hold government agencies accountable to the same contract laws they expect of the rest of the community.

There’s more work to be done.

Tax bureaucrats try to sneak one through

by

robertWho runs Australia? Is it the politically accountable politicians elected through the democratic process? Or is it the unidentified, unelected, bureaucrats who hide behind closed doors?

A situation happening now indicates that at least some Commonwealth bureaucrats think they run the country and democracy can go jump!

In the April budget last year, the Morrison government announced that the Tax Office would no longer be able to collect a small business tax debt while in dispute and under appeal. That’s a damn good policy move for tax fairness.

robertThe Small Business Minister stated in Parliament:

“We are backing small business in over the ATO. No longer will the ATO be able to garnishee and takeaway while the dispute is in train …”

A recording of the Ministers statement in Parliament can be viewed here  (23 sec)

A key job of the Commonwealth Treasury department is to draft legislation that puts government policy into effect. Last week, nine months after this very clear policy statement, Treasury released draft legislation that does the opposite of what the government promised. (See here and here.)

The draft legislation would not automatically stop the ATO collecting on a disputed debt. It would force a taxpayer to apply to the Administrative Appeals Tribunal (a very expensive process) for a pause. And a taxpayer would have to prove that their application did not “restrict …administration of tax law…” In our view this is a sneaky bureaucratic way of killing off the Morrison government’s attempt at small business tax fairness.

Yesterday we lodged a submission condemning the draft law and calling for it to be put in the trash bin. Here’s our submission (3 pages).

Robert Gottliebsen in The Australian took the same view with the headline ‘Tax bureaucrats try to sneak one through.’

Why ‘sneaky’? The draft legislation was released for ‘consultation’ on 12 January, smack bang when most people are on holidays, and during the height of the Djokovic mess and while the government was/is handling supply chain and other Covid ‘crisis’ issues. And Treasury has given only seven days for responses. The draft legislation is short and tax bureaucrats have had nine months where they could have done something. Looks sneaky? Probably is sneaky!

We’ve said in our submission:

The job of Treasury is to faithfully draft legislation that accurately reflects the government’s policy intent … we submit that this draft legislation undermines the government’s policy intent and the process of democracy in Australia.

We’ve made it clear what the legislation should look like.

Normally we admire the professional integrity of the Australian public service and their respect for the democratic process. This situation is a dark smudge on that professional integrity.

Covid ‘rebels’ and the Eureka Stockade

by

eureka-stockadeThere’s a band of people who see themselves as the ‘keepers’ of the Eureka Stockade tradition, and they are much miffed by anti-Covid lockdown protesters who wave the Eureka flag. The ‘miffed’ are principally unionist, republicans, and avowed leftists who hold that their causes shine bright under Eureka’s Southern Cross. To them, lockdown protesters are engaged in the theft of (their) sacred symbol.

But there are parallels between the Eureka rebellion and the anti-lockdown protests that give the current-day protesters some justification for flying the Eureka flag.

Eureka The Unfinished Business by Peter FitzSimons gives a highly detailed account of the ‘massacre’ (the term used by the Melbourne media at the time) just after dawn on Sunday, 3 December 1854. Some 30 ‘diggers’ were killed in a brutal 20-minute attack by colonial soldiers against the Eureka Stockade at Ballarat. Soldiers fell along with unknown other diggers – potentially several hundred – that died subsequently from horrendous wounds.

The seeds of the massacre were laid some short 20 years earlier when Melbourne was founded by a near lone explorer, John Batman. The ‘village’ and Victoria exploded in population to some 250,000 after gold was discovered in 1851 – not just ‘gold’ but massive nuggets were literally sitting under the soil, easily picked up by the lucky finder.

The Victorian colonial government appointed from London had a degree of local parliament, but the representatives were elected only by landholders (squatters). These lucky first settlers of Victoria had received huge land grants from the government, paid a small annual rent to the government, then acquired wealth on the back of wool and related grazing activity. These 4,000-or-so elite individuals were effectively a social and political nouveau riche aristocracy.

The gold rush induced not only a huge immigrant population explosion, but a rush of squatters’ workers and every other type of worker to leave their jobs for the lure of riches in the goldfields. The colonial government faced a big revenue shortage and so imposed a monthly mining levy on every goldfield digger whether the digger had found gold or not.

This levy, often violently enforced by the police, was the core reason for the Eureka revolt. Their ‘revolutionary’ theme was ‘no taxation without representation’.

The Eureka revolt is a symbol for some modern Australian republicans because some diggers, mainly Irish, added a republican agenda to the diggers’ cause. This divided the diggers.

Karl Marx himself, who wrote his Communist Manifesto in 1848, showed great interest in the diggers’ 1850s rebellion. In 1855 Marx opined that the rebellion was the workers’ proletariat rising up against the ruling bourgeoisie just as he predicted. This was enough for today’s political Left to grasp Eureka as their symbol of the inevitability of the workers’ revolution.

It was out of this Marxist idea of the endless struggle of the workers versus the bosses (however defined) that was – and remains – a central idea of the Australian union movement and the Australian Labor Party. As the primary funders and factional controllers of the ALP, Australian unions fly and display the Eureka flag at all opportunities.

But here’s where the truth of Eureka breaks from the symbolic myth and connects to the Covid ‘rebels’, particularly in Victoria.

The diggers were self-employed. They were ‘workers’ and ‘bosses’ all in one. This shatters the Marxist, Leftist, unionist myth. The Eureka revolution arose from ‘workers’ who deserted their ‘bosses’ to become their own bosses. They took their luck in the marketplace of gold prospecting. Their revolution was against the bureaucratic government elite who sought to (and did) distort their free market, thereby creating massive harm. The elite cared not for the harm they did.

Likewise the Covid ‘rebels’ are drawn heavily from the ranks of the self-employed. Under Covid, self-employed and small business Victorians have carried the financial burden, with some pushed into comparative poverty. These are the people most damaged by the world’s longest and harshest Covid lockdown – all staged in Victoria.

Look at the Victorian ‘revolution’…

Construction workers massed against and attacked their own union. A huge police presence was needed to protect the union ‘bosses’ in their Elizabeth St Melbourne citadel. Repeated weekend after weekend, huge but peaceful (even polite) rallies stretched from the gold rush funded Victorian Parliament House to the end and beyond of the 3 km Bourke St main city strip. Drone footage interposed with computer analysis put crowd numbers around some 120,000 at its peak.

And where do these Covid rebels come from? Mobile phone tracking analysis identifies the bulk of them from Melbourne’s outer ring of suburbs. These are the homes of the mortgage strugglers and low-income earners, says the analysis. They are heavily the self-employed hairdressers, personal trainers, tradies, and more.

These are the people who’ve carried the financial burden of the Covid lockdowns. Anyone on the financial teat of a heavily indebted, harsh, authoritarian Victorian Covid government has financially sailed through. Here is where the Covid government played the politics of dividing the community; to oppose the Covid policies was – and is – to be considered as scum.

Such was the story also of colonial Victoria. The Colonial Governor ran the line that the Eureka rebels threatened the very safety of the colony and the population.

Both the colonial and Covid Victorian governments resorted to harsh, even brutal police action. The Eureka Stockade massacre was the end product of increasingly brutal police tactics in enforcing the diggers’ licence. The firing of rubber bullets by Victoria’s anti-terrorists squad into the backs of fleeing Covid demonstrators was the end product of months of police activity arresting demonstrators for not ‘locking down’.

In 2020, Victoria police arrested a pregnant mother for ‘sedition’ because she expressed her anti-Covid policy opinion on Facebook. Thirteen of the Eureka ‘rebels’ were likewise charged with sedition and High Treason. All 13 rebels were found not guilty at trial. Common to both the colonial and Covid Victorian governments was the affront they took toward anyone seen to be defying their authority.

Sedition is the ‘crime’ of inciting people to rebel against authority. So obsessed were both governments with enforcing their authority that they blinded themselves to their own massive mismanagement that caused the defiance.

The colonial Governor repeatedly insisted on enforcing the diggers’ licence even after many deputations warned him of the consequences. The ‘Covid Premier’ Daniel Andrews oversaw a months-long disastrous hotel quarantine program that lead to 801 deaths and then reacted by imposing the world’s harshest and longest lockdown.

The Victorian Colonial Governor’s own inquiry found that it was the government’s maladministration caused the Eureka disaster. Similarly, the Victorian Covid government’s inquiry also found that it was government maladministration of hotel quarantine that lead to the initial wave of 801 deaths in 2020.

It is these similarities between the Eureka and Covid rebellions that stand out most in giving the Covid ‘rebels’ the right to wave the Eureka flag. Such similarities overpower unions, Leftists, and republicans who also claim a right to use the flag.

In 2004, on the 150th anniversary of Eureka, Eureka author John Molony stated, ‘Democracy is much more than a system. It is an ideal and a spirit born day by day in those who believe in it.’ How true.

Perhaps it is a strange quirk of Australian history that the core of both the Eureka and Covid rebellions is in Victoria. The starkest reason is that with Eureka and Covid, the Australian state with the harshest, most authoritarian, unyielding, manipulative, and even violent government occurred in Victoria. Strange indeed.

The Colonial Governor and government had a military victory in crushing the Eureka rebellion. Within a short year or so the government’s authority amongst the people had crashed and the Governor resigned. By 1859, along with a wave of democratic reform, Victoria had the vote for all males in a new Legislative Assembly. (Women had to wait another 50 years!) But the dominance of the landed elite was suppressed, spelling the death of a looming landed gentry class.

The Victorian Covid government seemingly won the lockdown battles of 2020-21. But history is yet to play out as to whether their authoritarianism prevails over a living day-by-day democracy.