Q: Andrew, 2020 has been a very challenging year, nothing like any one of us could have foreseen. How have you handled the challenges personally, and how has the IPA adapted to the changing nature of work?
Andrew Conway: So, if we turn our minds back to the end of 2019, we’re obviously in the midst of the drought and the bushfires that were plaguing Australia. And I don’t think any of us predicted what was about to come in 2020 with the onset of COVID.
So, it has been this continuum, over 12 months, of pressure, external pressure from droughts, bushfire, then floods, and now COVID and then recovery. The economic uncertainty. So, we ourselves, as an organisation, are not immune from those challenges and forces, but also obviously seeing firsthand through our members, the impact on small and micro businesses across Australia.
In many ways we look at it and say, “Well, it underlines and underscores the importance of strong advocacy, strong member support and services”.
Because when all of that comes at you, both as an organisation and a business adviser, we really have to be thinking about that oxygen mask principle – making sure that before our members go out into the field to support small-business owners themselves, they are actually ready and able and well enough to do that. Because we often forget that accountants as business advisers, generally speaking, are small and micro businesses themselves.
So, we have to keep that front of mind. But we went into 2020 with very much a growth mindset. We were coming off the back of the black summer of bushfires.
We were ready to launch into 2020 and support recovery and support the environmental recovery as well. But then of course, COVID hit. So we came out of that growth mindset, developed what I would describe as a survival instinct and that kicked in. And now if I were to label it, I’d say we’re in this phase of focusing on our own resilience.
I know that’s an often-used word now, but resilience and stability or stabilisation. So, recognising that before we can help members who can then help their clients, we have to make sure that our foundations are strong and stable.
Q: And tell me what it’s been like working from home. Having a massive team all in their own corners of Victoria or across the country, what’s that been like navigating, not being in the same space?
Andrew: Really trying to encourage team connection has been a real challenge. And I think I couldn’t be more proud of the team, the way in which people have managed the transition. So if we think back to March, so we flipped the switch completely on 22 March 2020. So we transitioned to a full remote working model then. Before it looks like we’ll be able to set foot back in our head office, it will be over 215 days of working from home. Now that’s a significant challenge. The reliance on technologies, stability of connections, being tolerant and accepting of the interruptions that come with working from home, particularly when you’re working from home and also your children are remotely learning as well. So, it’s just been a very, very different approach.
But again, from the way the team has responded has been incredibly dynamic and accommodating. Also the way in which our staff from outside Victoria and particularly as they have returned to a COVID normal whilst Victorian staff have not, the way in which the team has closed in around each other has been really, really impressive to see.
We often say from an organisational point of view, you never quite understand or see the culture of an organisation manifest until something pushes people as significantly as COVID has.
And I think it’s brought out the very best of the culture of the organisation around a genuine care and a genuine respect for each other. And we can write the word respect on these statements and plaster it around the organisation, but what actually matters is when push comes to shove, people do step up and they do genuinely care, and we’ve seen that in spades as a result of this pandemic response.
Q: And just with your members as well, because you are a member organisation and you’re used to hosting events throughout the year, and you’ve obviously had to cancel these events because of COVID measures and restrictions. So, how’s that been, handling that sort of relationship with members and your communication with them?
Andrew: Members obviously are our lifeblood. And when we look at March, we were issuing member invoices at the very peak of the first wave of the pandemic. Probably not the best time to be sending a member invoice out when of course mass uncertainty was around, but what members did … they stepped up and they said to us, “Now’s the time we need you. We need the IPA to be strong. We need it to be resilient and we need to support it.”
So, we had over a thousand more members renew by 30 June, than in 2019. And so what it said to us is that members were very keen to hold onto their membership to get the member benefit. And that’s really impressive from the way members have supported the institute as well, but also to have feedback about the various policy changes that were coming down the line as well.
They’ve been very active in providing frank and direct feedback to us, but the way in which we’ve engaged with them has been quite different. I still reach out to contact new members and welcome them to the Institute and we’ve still had new members joining in record numbers as well, which is really impressive. But in things like renewals we’ve said, “We understand this is really uncertain and it’s difficult, and your business might be challenged, but we want to work with you to maintain your membership. So, we’ll come up with flexible options.”
So, I, for example, included my own personal mobile number in our renewal notice. To say to members, “If you’ve got an issue or if you want to discuss your concerns or queries or just contact us.” Now, some have, some haven’t, but at least they know we’re here for them.
We also changed the way in which we run our member growth teams, which are our teams that go out to grow our membership.
We converted them to being member wellbeing teams. They’re making outbound calls to existing members to say just, “How are you going? Can we help you in any way?” And they’re just unsolicited quick, check-ins to say, “What can we do to help?”
Members have told us that they appreciated those. And then there’s the transition to online learning. We had to take our busiest time of the year for face-to-face learning, which is generally the last quarter of the financial year and convert all those courses online. Our team has stepped up and done a tremendous job in turning the vast volume of training packages to online delivery.
We were quite anxious about that switch, but it worked out so much better than we could have forecast and members also gave us the feedback to say they enjoyed that experience as well.
I don’t believe that face-to-face learning has gone. In fact, we are now seeing a transition back to that in other states around Australia, which is really pleasing. But I think what’s changed is that, we probably won’t see members coming into CBD office locations to do training for two or three hours at a time. I think that model has changed and I think what we’re seeing is a transition in how you’re getting that information, but while also maintaining a social connection for the residential type learning we’ll be returning to shortly.
And just on the education front, one of the other key transitions we made in the wake of the pandemic is to say, “What can we do to change our entire CPD model?”
And so we have … This is on the back of the work that was done on changing the education standards and approach to create a future-ready profession.
To us, future ready is about three, effective streams of CPD linked to your stage of career. There’s the practical knowledge, there’s the in focus or the fundamentals, and then there’s also the accomplished and advanced CPD.
It’s changing the way we’re thinking about CPD, and it’s allowed us the time (and in a way it’s forced us) to introduce this new, what we call the CPD taxonomy of matching your stage of career with a stream of learning. There is the technical knowledge, the professional competence, and then as a professional. Those are the three streams we’ve changed our CPD to encompass, and that’s the matrix we’re now using.
Q: And speaking of your members, most of them being accountants and small-business owners, obviously this COVID crisis has kicked that sector the worst. You’ve said how you’re trying to help them as well throughout this whole crisis, but accountants have been at the frontline. How are they doing at the moment? How are things looking?
Andrew: Look, I think generally accountants are holding up okay. But they are under significant pressure. And we saw that in the first wave with the first round of JobKeeper, then JobKeeper 2.0, and the enquiries coming through from small businesses were thick and fast.
They are still coming through. And so, for a large amount of time, practitioners in particular were unable to even bill time because they were responding to general queries. We found ourselves having to step up to try and provide that support to members to free them up so that members could potentially divert those client enquiries just to a central resource being the IPA COVID-19 update hub. That’s been a particular challenge, I think for members to be able to focus on work that is value adding.
We are hearing directly from members, from regional members, as well as metropolitan members, who say they are under significantly pressure. And I’ve had members say they literally feel that they are just on the edge of holding it together. And I’ve put those concerns directly to government. I’m now on the Victorian government’s business recovery committee, and I’ve expressed directly to the Premier and to the ministers, that “If you want accountants to be there as the frontline of economic recovery, you’ve got to make sure that you’re providing settings to ensure that accountants and business advisers are strong and stable and ready for that challenge. Otherwise, it’s like building a house on sand.”
We want the recovery to be built on a bedrock of quality and of advice that is actually coming from an accountant who is able, willing and ready to provide that advice. So again, that oxygen mask principle, putting it on themselves first before they can actually help other businesses.
We’ve got a few projects on the go at the moment to try and provide that support right through from clinical support, directly to a practitioner who is at, if you like, the pointy end of their own mental wellbeing and saying, “I actually need someone to talk to.” We are finding an increasing demand for those services and we’re working with government to streamline access to those services, but then looking at a longer-term view as to how do we equip communities with the education and experience and training they need to support their own community of clients and businesses? We’ll have a bit more to say about that as 2021 unfolds, but we’re really excited about the body of work that’s going into research innovation in small-business owners’ mental health.
Q: And speaking of government last year, you were quite happy with the amount of attention you were receiving from the government as a profession, has that changed this year? Given that the government has been quite busy with enacting these measures and that they haven’t maybe consulted the accounting profession as much as you guys would have liked.
Andrew: Look, I think it’s a fair observation to say that our relationship with government last year was probably more predictable in the sense that it was a typical flow of things.
You have an exposure draft, you have some consultation, you’d interact with ministers, you get your feedback in and it was all much more orderly. Obviously, in the wake of the pandemic we went from policy announcement on things like JobKeeper to enactment of legislation within a week.
Those original timelines that we’d all come to expect were just blown out completely. Government had to move and move quickly. Things like the design of JobKeeper and some of the nuances arising from that probably could have been ironed out with better consultation, but by the same token, you can’t let the pursuit of robust consultation get in the way of an immediate-term economic recovery solution.
So, we certainly give government a leave pass on that consultation front. But behind the scenes, there’s been a lot of work with groups like the ATO. You could say that our relationship with government has taken a new form, where we are engaging directly with ministers. They are reaching out far more directly, which has been refreshing in a way where it wouldn’t be uncommon for me to get a call from a federal minister to say, “Hey, we’re about to go with this. What do you think?” Now, that still happened in the past, but the regularity of that’s increased.
It’s just a different relationship. And I think what’s also been important to recognise is the changing role that even advocates like the Australian Small Business and Family Enterprise Ombudsman has taken. Kate Cornell’s office has taken on a different role.
They have within their remit the role of advocacy, but I think that’s been enhanced significantly in the wake of the pandemic. So, I couldn’t be critical of the way the government is responding or has engaged at the federal level. I think at the state level, there’s a challenge where state governments are scrambling to identify lines of revenue. They’re under significant fiscal pressure.
I appreciate that the Victorian government in particular has being talking about solving a health crisis before the economic crisis, but we do think it is important to advance recovery on both fronts, as we emerged from the health crisis, we should be more advanced on the economic recovery plan than we are perhaps at the state level.
Q: And some of the government measures that we’ve discussed before as well, obviously we recently saw the budget and a lot in that budget was directed at helping SMEs. But tell me, what have been some of the particular standouts this year? Obviously JobKeeper would be a massive one.
Andrew: There’s been a lot of measures and you can have some fatigue about trying to make sense of them all. The easy part for government, from a branding point of view is that they labelled most of the initiatives with “jobs” or “job”. So it’s been JobKeeper, JobMaker, JobTrainer … So we get it, it’s about jobs and that’s important. When we look at the compound nature of those benefits, I think it’s important to think about the JobKeeper arrangements, right from the start. Also, the newly announced JobTrainer package needs to be read in conjunction with the government’s changes to personal tax cuts, which do affect every Australian, and in particular unincorporated small businesses, which make up 60 per cent of small businesses.
Then the loan guarantee scheme provisions, of course, which have been extended out. Changes to insolvency requirements, as well as the relaxation of the responsible lending provisions of banks. That’s not to say that they’re not small businesses who are still significantly struggling and who will not come out of this, but I really do hate to think what stats we would be looking at with business closures and wind-ups had those measures not been introduced. I think government does deserve credit on those fronts for the mechanisms.
The combination of those things has created significant benefit. In terms of what do we expect and what would we like to see? I think a couple of things really. More targeted things such as the small-business viability support.
We think it’s really important for small businesses to get access to professional and proficient advice as quickly as possible. We think of business viability, a voucher scheme, if you like, or some sort of incentive to engage a professional is really important. And it’s pleasing that Kate Cornell as the Ombudsman has also pointed that out as has all the other professional bodies.
So that’s on the very hard to-do list, but I think stepping back from all this we need to ask whether we genuinely have a model of regulation in Australia for small business that is suitable and will enable growth and enable recovery?
And I think the answer is, overwhelmingly at the moment, we don’t.
We think there’s an opportunity for us to reset the settings. So our big-ticket item, if you like, for 2021 and beyond is to advocate the establishment of a small-business administration for Australia.
Now, that would be a new Commonwealth agency that would require – this is where it gets a bit provocative – the referral of powers from the states and territories to the Commonwealth to create a one-stop shop for a small business in Australia, to know what rules and regulations apply to them.
Do you want to operate and start up in NSW and then trade in Victoria and elsewhere? You should have access to a one-stop shop where you can find out how to do that. This model is used in the US. So, in the US, in the 50s, in the wake of World War II, the US president, [Lyndon] Johnson actually created the Small Business Administration as a post-war recovery agency and it had the target of supporting businesses to start, to grow, to expand or recover. But importantly, if they suffered disaster or were subject to natural disaster, which of course in Australia is all too common, then the agency itself, the Small Business Administration, can step in and support business.
They’re also a lender of last resort. So they put real competition into the banking system. We don’t always advocate big government, but we do advocate smarter government. We think it’s time. We think it’s time to actually have a mature conversation about a more efficient model and a site for a small business who wants to start up, who wants to survive and grow. Businesses will know “Here is where the rule book sits, here is where you go to for advice” and away you go, it’s there to support you.
Fundamental reform is really critical. So yes, it’s good to have government talk about jobs, jobs, jobs, but I think what our focus will be is on reform, reform, reform. Reform the taxation system, reform the regulation, and reform the industrial relations and workplace relations to remove those burdens from small business.
Q: Now Andrew, I know that the IPA’s reach expands far beyond Australia, obviously into the UK. How are they doing over there? We’ve seen cases unfortunately pick up again.
Andrew: Yeah, so it’s eerily similar, obviously in the wake of a global pandemic no one is immune, no market is immune. And of course, in the UK, as they now are going into their winter, of course, it means that the risk is greater in terms of the spread of the virus. So, the UK government has stepped up the lockdown measures as well. There is significant concern that is pervading the UK economy. The small-business sector and sentiment are very much down. And our members in the UK are having to contend with the notion of yet another wave of the virus and obviously the negative consumer sentiment driving down small-business prospects as well.
So, they are eerily similar, obviously different numbers and everyone’s circumstance is different, but the circumstance of members in the UK is almost identical to Australia. We’re finding ourselves doing more and more wellbeing support also, there’s a peer-to-peer support network that’s been created by the team in the UK.
Q: Given everything we have spoken about, are we allowed to be hopeful for 2021?
Andrew: Well, we have to be. We have to be resilient. We have to be positive. We have to look for those green shoots. We’re seeing lower-than-expected unemployment figures across the country, which are positive if you can take a positive out of unemployment figures.
I think what’s important, the flip side of that, is that job creation numbers are better than expected. So it does point to those green shoots across the economy. And I think we just have to fertilise those green shoots.
We do have reasons to be optimistic. We look at the prospect of things like a vaccine, which a lot of the economists are saying will be the enabler to a significant recovery, but I would expect that notwithstanding any further wave in Australia, you would expect to see a fairly rapid economic recovery.
A lot of the analysis points to Australia’s economic impacts, although it’s been severe, it is one of the lower impacts across the developed world. So we are coming at this and starting our recovery from a much stronger position than many other countries around the world. I think we’ve got a lot to be confident about, a lot to be positive about in Australia.
We just have to proceed with caution, but with a degree of positivity, because we’ve proven that we can come through some pretty severe adversity. And if we think back, whether you’re in Victoria or elsewhere across the country, what we’ve come through – droughts and floods and bushfires, and now into a global pandemic – we have withstood significant external forces where everything was thrown at small business and at us, our own families and households, and we’ve come through it.
That’s critical for us to hold onto. If that’s been possible, to get through in some jurisdictions a nine-month lockdown and emerge from that, we should be confident that we can actually manage this recovery quickly. So, I am optimistic, I think we have to be.
Q: And what about the IPA in 2021, what’s on the radar for the team?
Andrew: We’ve had a plan ready to go since August, actually we’ve had a return to the office plan, ready to go. So we’re ready to return, but I think that’s got to be guided obviously by the government authorities and we’ll continue to do that. I can see us returning before the end of the year. I can see us getting to some degree of a normal routine by then in a staggered and staged return. Then we’ll get to 2021. And I would hope that we’ll have pretty much back to normal operation, return of face-to-face learning interactions for members. Our members are saying they’re crying out for face-to-face interaction with each other. So we’ll look at facilitating that. Our prospects are very solid.
We’ll also have a bit to say about changes to the IPA’s education program going forward, and then also enhancements to the accounting technician segment as well. So that’s another exciting aspect. We brought in the Association of Accounting Technicians into the IPA Group on 30 June this year. And we are working collaboratively on a new certification model for accounting technicians in Australia, which is going to be really exciting – a new CAT which will position the mechanic technician very much within the accounting profession. We have always firmly seen the accounting technician as within the profession and so we’re looking to enhance that significantly and then look at growing our market continuously.
Overall, we’re coming at this from a very, very strong position, which is great, and that’s all built on the back of member support. So yes, there’s a lot to do both on the advocacy front, but also on the educational front and really at these times of transition for an economy and for a profession, I think it is fundamental for professionals to think about their own skill set, their own kitbag, do they have everything they need to serve the needs of their clients and employers going forward?
And now’s the time really to be investigating scaling up. We’ve tried to provide as much of that information as we can either free of charge or at below cost levels for members to have access to.
What we’re going to see, is that new wave as members come through, this building their education base, knowledge base, to continue to add value to their clients and improve their quality of life.
Q: And Andrew, what’s one positive thing that you think you’ll take away from 2020? Something that you want to remember it by, other than the COVID pandemic?
Andrew: I think in a way, if there is positive, it’s been a forced reset on the pace of life. My wife and I often talk about this, “How do we ever do the running around at the weekends?” The weekdays are busy enough. And if I was zigzagging around the countryside in my role and we do the footy training, the basketball training, netball training, try and squeeze in music lessons and then we get to the weekend … You end up on some Sunday afternoons saying, “What was all that?”
For us personally, it’s been a forced reset and being able to just spend more time together, obviously we’re being forced to, but spending more time together as a family. There’s no price on that. And if that’s kept the community safe and we’ve been able to withstand a global pandemic, that’s obviously great, but from a selfish family point of view, reclaiming that time has been quite invaluable.
