Small business advocates react to 2023 Federal Budget

- May 10, 2023 4 MIN READ


The 2023 Budget is a mixed bag for small business, with some relief provided but more measures needed to support the nation’s army of 2.5 million business owners.

The Australian Small Business and Family Enterprise Ombudsman, Bruce Billson, says the budget announcements will help many small businesses with contemporary challenges.

“There is support for small and family businesses to tackle immediate pressures, particularly with high energy input costs, an asset write-off boost to help re-equip and invest in productivity, tax administration changes that will help with vital cash flow challenges, and much-needed advice to deal with cyber security fears,” Billson said.

“Energising enterprise can deliver a stronger economy and these measures are a step towards delivering that.”

However, Billson expressed disappointment in a reduction of support for the Self-Employment Assistance Small Business Coaching program and the Entrepreneurship Facilitators Program.

“These programs have low awareness and can help with the success and durability of many of the 1.6 million Australians who derive their livelihoods from self-employment and make a vital contribution to the economy,” Billson said.

budget digital skills

More digital support needed

MYOB Chief Employee Experience Officer, Helen Lea, said while the budget outcomes support small businesses in the short term, there is a greater opportunity to enable businesses to make future-focused investments for growth.

“We would have liked to have seen more targeted outcomes for the meaningful digital progression of the sector, to inspire confidence and encourage investments to enhance productivity businesses, and in turn, national growth,” Lea said.

“In a market where small and medium businesses need to achieve more with less, we want to see more support to help small businesses to adopt digital tools to increase efficiency and help them navigate these tough times.

“Last October, this Government committed to the legislation of the Small Business Technology Investment Boost, which would see businesses receive a 20 per cent tax rebate for investment in cloud-based software. This legislation expires at the end of this financial year and is still not passed, leaving SMEs without the certainty they need to invest.”

“With small and medium-sized businesses already contributing $700 billion to the economy, helping them to adopt digital tools would go much further than just weathering this short-term economic uncertainty, Lea said.

Staffing struggles continue

Ben Thompson, CEO, Employment Hero said it was positive that the 2023 budget highlights the challenges small businesses face in hiring and retaining staff in Australia’s tight job market.

“With only nine per cent of business owners looking to hire full-time workers, while 12 per cent are seeking part-time or casual workers, this underscores the importance of flexible and efficient solutions when it comes to small businesses and recruitment. We really do hope, for businesses’ sake, that the federal government will support employers to hire needed staff.

“As the largest employer in the country, small businesses are indeed the lifeblood of the Australian economy, and it’s crucial to support these businesses by providing innovative solutions that enable them to attract and retain top talent, even in challenging economic conditions.”

The 2023 Budget is set to provide small businesses with energy savings via the Small Business Energy Incentive

Is the Small Business Energy Incentive enough?

Joseph Lyons, Managing Director – APAC, Xero said while Xero welcomed the increased support for small businesses facing elevated business costs and increased cost of living, more needed to be done to drive productivity and digitalisation.

“By introducing measures like the Small Business Energy Incentive, the Government is using its balance sheet to lower operational costs for small businesses by incentivising the adoption of energy efficiency practices – a positive but short-term solution to address inflationary pressures.

[However] “The Government needs to prioritise rolling out measures to increase small business innovation to unlock more efficient processes, driving ongoing productivity long term,” Lyon said.

Huon Hoogesteger, MD of Smart Commercial Solar, who has been advocating for support for small businesses to transition to more sustainable power was disparaging of the government’s $310 million energy relief package.

“Forgive my scepticism of vote-grabbing headlines, but 95 per cent of small businesses are not the ones that have the spare cash to be spending on non-core business items at this point in time,” Hoogesteger said.

“So, this money will be wasted on businesses that could already afford to spend that extra money and who are already doing something. This cash won’t stimulate new markets and it’s a relatively small amount of money when you consider there are 2.4 million small businesses in Australia, most of them people in cars and utes. Even so, that equates to less than $130 each. Even if we go to supply the potentially 90,000 businesses that are slightly bigger, this will have absolutely no impact on the majority of small business.”

Hoogesteger praised the government’s Net Zero initiative, saying it would help the 1,000s of workers soon to be displaced.

“The Net Zero Authority makes a lot of sense. The energy transition is going to displace many people because of the speed of this transition and the Government’s hand in forcing the change, and the need for re-skilling is immediate,” he said.

“I remember the effect of Newcastle Steelworks closing down; the Government provided additional training resources to re-train people into jobs that were going to be available. I think the same goes for coal mining and other manufacturing jobs that are going to be lost as we transition away from coal-fired power stations. My only preferred option is to actually create opportunity rather than just training. Projects like building new airports and stimulating businesses to start or move to these population centres is probably a longer-term solution. It’s something the U.S. has done well, with special zoning and tax incentives to get companies to move their facilities to these changing areas.”

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