Small business was not high on the agenda of Treasurer Jim Chalmers’ fourth Federal Budget, handed down last night.
There were some minor relief measures, including a six-month extension of energy bill rebates (up to $150) which will ease costs for about one million small businesses and extending Unfair Trading Practices protection to small businesses.
However, the Budget was a missed opportunity to set out a strategy to fuel growth in the small business sector, according to the Council of Small Business Organisations Australia (COSBOA) and the Franchise Council of Australia (FCA).
COSBOA CEO Luke Achterstraat said the Budget was a recycle of existing policies that failed the small business community.
“With decade-high insolvencies and crippling energy, rent and input costs, this Budget had the opportunity to provide a long-term roadmap for small business growth,” Achterstraat said.
He also pointed to the government’s failure to account for the Instant Asset Write-Off (IAWO) in the Budget papers.
“Small business needs certainty when it comes to the Instant Asset Write-Off. Not only is this measure unaccounted for in the budget, but it is yet to even be legislated for this financial year,” he said.
“In a volatile economic environment, the IAWO should be made permanent to provide an added incentive to invest and improve business.”
Limited initiatives to support sector
The FCA CEO Jay Westbury agreed the Budget offers limited new initiatives for small business.
“While some modest measures are welcome, this year’s Budget stops short of delivering the coordinated support franchising and small business need,” he said.
Franchising in Australia supports nearly 2.6 million small businesses (franchisors and franchisees), contributes over $590 billion to the economy, and employs more than 5.4 million Australians.
Westbury said “The contribution of franchising to the Australian economy is significant — and we need policies that reflect that reality.”
Both the FCA and COSBOA welcomed measures to help level the playing field for small business including extending Unfair Trading Practice protections to small businesses.
However, Achterstraat suggested Australia would face lagging productivity, reduced competition and lower living standards until small businesses were empowered to succeed.
“With an election pending, we challenge both major parties to propose substantive development and growth strategies for small business, providing certainty and encouragement to the 5.6 million individuals who own organisations and work in the sector,” Achterstraat said.
The upcoming implementation of the updated Franchising Code of Conduct imminent on 1 April 2025 is top of mind at the FCA, which continues to work collaboratively with Government on key reforms.
“We remain committed to working constructively with Government on reforms that strengthen our sector. Our focus is on ensuring that the Code changes and any future licensing regime deliver practical, fit-for-purpose outcomes for businesses on the ground,” Westbury said.
