Dan Kelly-The Great Negotiator

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Dan Kelly serves as President, Chief Executive Officer and Chair of the Board of Governors of the Canadian Federation of Independent Business (CFIB). In this capacity, Dan is the lead spokesperson and advocate for the views of the Federation’s 110,000 small and medium-sized member businesses.

Dan joined CFIB in 1994 as Policy Analyst for the Prairies and, soon after, became Director of Provincial Affairs for Manitoba. Dan led many files, including the call for balanced budget laws and workers’ compensation reform. In 1999, Dan moved to Calgary to become CFIB’s Western Vice-President and was named one of Alberta’s 50 most influential people while in that role. In Western Canada, Dan led the Federation’s work on the growing shortage of labour, training, and immigration, publishing many influential studies on these files. In 2009, Dan took on the role of Senior Vice-President, Legislative Affairs, where he led CFIB’s successful campaign to establish a Code of Conduct for the credit and debit card industry. CFIB’s Board of Governors appointed Dan as President and CEO as of June 2012, and Chair in June 2014. In 2015, Dan was named one of the “Top 100 Most Powerful and Influential People in Government and Politics”, by Power & Influence magazine.

Dan has served on dozens of provincial and federal committees and task forces and has represented Canada’s small businesses at the International Labour Organization in Geneva. He currently serves on Finance Canada Payments Consultative Committee (FINPAY) and the Canadian International Trade Tribunal Advisory Committee. Dan is a regular speaker in Canada and around the world on topics like international trade, the payments industry, and skills and labour shortages.

Prior to joining CFIB, Dan served as a policy advisor to the Premier of Manitoba. In this capacity, Dan gained a great deal of knowledge on the legislative and political functions of government – specializing in rural development, transportation, and economic matters.

Dan was born and raised in Winnipeg and graduated with a Bachelor of Commerce from the University of Manitoba.

 

Can you tell us a little bit about the role that the Canadian Federation of Independent Business plays in the small business community?

Small business owners on their own don’t generally have a big voice, and they don’t have the resources to hire a lobbyist. In the last few months, Canada has been gripped by a scandal about a large corporation, SNC-Lavalin, and their lobby efforts with the federal government to try to push for a special deal with respect to the legal challenges that they are facing. A small company can’t afford to hire somebody that’s going to be calling the Prime Minister’s office every five minutes. However, collectively when small businesses come together and join the Federation, we can go to bat for them in Ottawa, at provincial capitals and increasingly with municipal governments across the country. That’s why CFIB was founded 48 years ago. John Bullock founded CFIB on a tax protest. There was a proposal at the time to increase the rate of taxation on small firms to fifty percent and after he read about this proposal, he started to organize small business owners across the country. After he successfully won that fight, he really saw the need to found an organization that could be the voice for SMEs in Canada. We’ve evolved significantly over the past 48 years, but always to serve SMEs.

We have focused on providing savings and benefits programs for our members through partnerships with companies like Mastercard, American Express, Payworks, and Scotiabank to give them real value. We’ve negotiated significant discounts with credit card processing, insurance, and banking services by leveraging the bargaining strength of 110,000 businesses.

The third primary focus for CFIB is to provide business counseling and business support. Small firms don’t have a vice-president of HR or a compliance specialist on staff, but they still have to navigate complex government rules and regulations. We help them understand those rules and regulations. In fact, our members can call our business counselors with any question they may have and be assured that someone is in their corner.

 

Can you please share a few details with our readers regarding how you started with CFIB?

I have worked with CFIB for many years. 25 years ago, I started as a policy analyst in our office in Winnipeg. I moved within CFIB to Calgary, then to Ottawa, and when I became president I moved to our Toronto office.

Before CFIB, I was really interested in politics and I started as a policy analyst working for the Premier of Manitoba. One of my first jobs was helping the premier respond to all of the surveys that were done by the Canadian Federation of Independent Business. When a job became open at CFIB, I talked to the Federation, and that’s when it all began. CFIB represents independently owned and operated companies. Working with small business owners has been a real joy. Once they’re established, many business owners start to think about their role in their local community, the jobs that they create, and the contributions that they give to their local charitable organizations, kids sports teams, etc.

I think Canadians underestimate and under-appreciate how significant the contributions from SMEs across Canada are. 57 percent of private-sector workers are employed by small businesses and they contribute 52 percent of the business sector GDP in Canada. Collectively, their impact is massive and I don’t think small business owners get nearly enough attention for the contributions that they are making. It’s one of the reasons I’m happy to hear that you have founded CanadianSME Magazine! I think that will be another great venue for small business owners to read about each other, to learn and perhaps to improve their businesses over time.

You just celebrated your 25th anniversary at CFIB. You are the spokesperson and advocate for independent businesses. What drives you to advocate for small businesses every day?

One of the joys of working at CFIB is that you feel good about what you do. We are not just doing it for business owners, or for our members, but for the country. Canada has not always celebrated entrepreneurship. In fact, entrepreneurship decades ago were a dirty word. People had a distrust for business owners in general. People assume that if you own your own business that somehow “you are rich” and that’s not the case at all.

We are a nonpartisan organization, but we use the political power of 110,000 businesses to try to get the government to make changes. We have been able to accomplish great things for small business owners and I think those changes have been helpful in growing the country. Getting the big credit card companies to stop charging independent merchants exorbitant fees on transactions while giving deep discounts to big companies was an important victory. So is bringing attention to the burden of red tape that the federal and provincial governments impose on business owners and getting them to cut back. Recently, I was in Sault Ste. Marie, Ontario speaking to the Rotary Club and I must have met 30 CFIB members that have been with us for a long time. To listen to the business owners about how happy they are to have an organization like CFIB by their side was a real treat.

 

In 2015 you were named one of the top 100 most powerful and influential people in government and politics. What has this meant for you and CFIB?

CFIB for many years has been regarded as one of the top 10 advocacy groups in the country. The previous Prime Minister Stephen Harper said that CFIB is the most influential advocacy group in his lifetime. The influence that we have comes from the size of our membership. So we are very focused on growing and continually adding more small businesses to our ranks.

Business owners are looking for real value, and we want to make sure that CFIB is very conscious of that. We are not like a union, which has mandatory membership dues whether you wish to be a member or not. At CFIB, it’s a voluntary decision and that keeps us sharp. We make sure that we are serving our members well. Otherwise, they’re not going to stay with us.

 

You often speak about international trade in Canada and throughout the world, why are international trade important for small businesses?

More and more businesses are looking at markets outside of Canada because they know that they want to grow and expand into international markets. The vast majority of our trade goes directly south of here. However, we saw after the economic recession in 2008, and I think more recently since President Trump has taken office that we can’t always depend on having access to the US market.

Our members have been very supportive of the new free trade agreements. Canada has signed the CETA agreement with Europe as well as the CPTPP with the Pacific Rim nations. Those are very exciting opportunities and we are trying to encourage more small firms to participate in international trade.

 

What is the biggest challenge of running a small business?

A business owner has many challenges. They may know their particular craft or trade very well, but that does not necessarily mean that they are prepared for everything involved in running a business, such as HR issues or compliance, and that’s where we try to help.

For example, one of the services we provide is training for business owners. We partner with Vubiz(Virtual University for Business) and we provide about 40 different courses on running your own business for free to our members.

Recently we’ve seen the small business tax changes in 2017, the new expansion of the Canada Pension Plan and the new carbon tax that has been implemented by the federal government in four provinces. This is in addition to many provinces drastically increasing minimum wages or changing labour laws, making it very difficult for a business owner to run their independent operation. That’s where CFIB can play a big role in advocating for small- and medium-sized businesses. Many business owners have been feeling really let down by their governments recently. Governments need to pay attention; otherwise, they are going to risk losing whatever support they’ve had from SMEs.

What are the big issues for small businesses in the upcoming federal elections?

We have had a rocky relationship with the current federal government over the last couple of years. It started during the election campaign. The prime minister spoke to Peter Mansbridge of the CBC at the time, and he said that a large percentage of small businesses are merely fronts for wealthy Canadians to save on their taxes. That started at the very top, and it created much alarm. We then saw the 2016 budget when the federal government canceled their commitments to reduce the small business corporate tax rate, and then in 2017 they planned the most extensive set of changes to small business tax policy in 40 years – they did that with virtually no consultation whatsoever.

Small business owners were angry, and they came together and pushed back against the federal government and were successful in doing so. Looking forward to this upcoming federal election, there is much frustration over tax policies and we want to see the small business tax changes reversed. There is also the Canada Pension Plan premium increases that we think that the government needs to put the brakes on. Finally, the carbon tax is another big file, and we’re asking the government to rethink the way that they’re going about the federal carbon tax.

Right now concerning the carbon tax, the government has said that consumers are going to get bugger rebates than what they will pay in and big businesses are getting exemptions. Half of the bill for the carbon tax will be paid by small- and medium-sized companies in Canada, but they will only get back about 10 percent in grants and that’s deeply unfair. If we are going to have a carbon tax, it should be fair, and all Canadians should be asked to contribute, not just those Canadians who own small businesses.

I do also worry about the next generation entering into the workforce: there are lots of jobs that are sitting vacant right now because Canadian young people are not accepting them, and that says to me that we need to use our immigration policies more strategically. We need to ensure that Canada continues to attract a good number of immigrants to come and fill jobs at all skill levels in the economy, so immigration policy I think from a small business perspective is a pretty important one too.

 

CFIB 50th anniversary is coming up, what does that mean to you?

I think it’s a huge sign of success. I became president about seven years ago to ensure that CFIB is a permanent force for good in Canada. We have had record years of membership growth. 2017 was a solid year for membership growth at CFIB, and 2018 was even better. 19,000 new businesses became members of CFIB last year, which is one of our most significant growth years ever.

CFIB’s best years are ahead of us, not behind us. We are still growing and serving as a force to ensure that the interests of small businesses and entrepreneurs are heard and listened to in Canada.

 

What is your piece of advice for Canadian small business owners?

I think one of the things that small business owners should pay close attention to is the upcoming demographic challenges that Canada is facing. We have an aging population and it is going to become harder to find staff over time. Business owners need to ensure that they are looking at all of the things that they can do to make sure that they can continue to get their products and services to market.

For some that might mean increasing automation to find some improvements in productivity. For others, it might mean a more detailed HR strategy to ensure that they can compete and attract the talent that they need for the future. Or it may mean using the immigration system to try to pull in talent that exists overseas for jobs in Canada. However, I think that this would be my main piece of advice: focus on ensuring that you have the human resources and the human capital that you will need to succeed in the future.

 

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