AUSTRALIAN Small Business and Family Enterprise Ombudsman, Kate Carnell said she was "deeply concerned" by fresh data showing small business growth is in crisis. She is urging Federal and State Governments to do more to break down the barriers to business expansion.

“The Institute of Public Affairs’ (IPA) latest research has found an alarming decline in the rate of small business growth,” Ms Carnell said.

“What concerns me greatly about this report’s findings is the sharp drop in the percentage of small businesses hiring additional staff.

“Less than one percent of small businesses with 1-4 employees in 2017, employed more than four workers in 2018. That’s significantly below the historical transition rate of 6 percent. 

“Less than one percent of businesses with 5-19 employees were employing more than 19 people in 2018. That’s also well under the historical transition rate of 4 percent," she said.

“A major issue is Australia’s rigid industrial relations system. The research cites World Economic Forum surveys, which have consistently found Australia’s labour market regulation is the most problematic factor for doing business.

“Part of that broad picture is ensuring small business owners can feel confident they can meet their obligations and avoid an unfair dismissal claim in the event they need to let a worker go," Ms Carnell said.

“That’s why my office has recommended a number of important changes and additional checklists to the Small Business Fair Dismissal Code.

“A clearer Code would reduce the risk of unfair dismissal claims and provide small business owners with the impetus they need to hire more staff," she said.

“The government has announced a review into the industrial relations system. The Small Business Fair Dismissal Code should be number one on that agenda.”

www.asbfeo.gov.au

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THE Australian Small Business and Family Enterprise Ombudsman (ASBFEO), Kate Carnell has welcomed draft legislation that extends the unfair contract term regime to insurance contracts. However, she warned that much more should be done to improve protection for small businesses.

“Removing the current exemption for insurance contracts from the unfair contract term regime as recommended by Commissioner Hayne, is a logical step,” Ms Carnell said.

“However there’s room for significant improvements to the current unfair contract term legislation more broadly.

“While my office is able to resolve many contract disputes by using the unfair contract term provisions as a lever, on occasions when these negotiations fail, an SME is forced to seek a ruling through the courts," Ms Carnell said.

“This is a very costly exercise for small businesses and larger companies have more resources to delay court proceedings until the SME either gives up or goes out of business. 

“It’s for this reason, regulators should be given greater powers to both determine and deal with unfair contract term cases, both in the insurance space and other contracts that SMEs enter into.

“Unfair contract terms should be made illegal and penalties should apply to breaches," Ms Carnell said.

“The legislation should also be extended to cover contracts up to $5 million.

“If and when this exemption for insurance contracts is removed from the unfair contract term regime, small businesses will still have to wait a further 18 months at least before it applies to contracts they enter into.

“In the meantime, we will continue to advocate for a change in how small businesses can challenge unfair contract terms outside the court system," she said.

“At the end of the day, all changes to legislation or regulation that affect small businesses should aim to reduce red tape and level the playing field between small and large businesses.”

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WHILE the new Banking Code of Practice is an improvement on previous versions, it remains to be seen if it will be effective in addressing the imbalance of power held by the banks. That is the view of the Australian Small Business and Family Enterprise Ombudsman, Kate Carnell.

“There have been a number of claims made in the media that this Banking Code of Practice has teeth, but clause 213 states banks need only comply with reasonable requests from the Banking Code Compliance Committee (BCCC),” Ms Carnell said.

“That calls into question the ability of the committee to be effective," she warned.

“We will be watching very closely to see just how strongly the code is enforced, particularly as it relates to small businesses.

“In the meantime, we are encouraging small businesses who have dealings with the Banking Code Compliance Committee (BCCC) to tell ASBFEO about their experience," Ms Carnell said. 

“We want small businesses to help us gain an understanding of whether this committee is doing the job that it is supposed to.

“As the code only applies to 19 banking groups – there are over 100 deposit taking institutions – small businesses must first establish if the code applies to their bank and if they meet the code’s definition of a small business.”

Ms Carnell said under the code, small businesses were defined as having an annual turnover of less than $10 million, fewer than 100 staff and crucially had less than $3 million total debt to all credit providers.”

“As the revised Banking Code of Practice works towards improving banks’ small business lending practices, we will continue to monitor its effectiveness and to advocate for safeguards against misconduct in the hope of restoring small business’ confidence in banks,” Ms Carnell said.

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GROUNDWATER experts from several Australian universities have repeated calls for further investigations into the potential effects on heritage groundwater reserves in central Queensland if the giant Adani Carmichael coalmine gets the final regulatory go-ahead.

Adani is sticking by its environmental impact statments and recently updated aquifer research which has already received the green light from Federal Government bodies including the CSIRO. 

Concerns the ancient Doongmabulla Springs face a ‘reasonable threat of extinction’ from Adani’s proposed Galilee Basin coalmine are raised in a new position paper from the university researchers, which they say echoes previous research by CSIRO and Geoscience Australia.

The Queensland Government is due to rule on the groundwater hurdle on June 13, after clearing the way to another environmental concern, supporting Adani’s proposed management plan for the endangered black-throated finch.

Experts from Flinders University, RMIT, Monash and Latrobe universities say their report,  ‘Deficiencies in the scientific assessment of the Carmichael Mine impacts to the Doongmabulla Springs’ – now before the Queensland Government – highlights problems with Adani’s own claims that the springs are safeguarded by “an impervious layer, restricting water from flowing between the underground aquifers”.

“Adani has not properly examined the link between the mine’s groundwater drawdown and impacts to the Doongmabulla Springs, which is a fundamental requirement of the Carmichael mine’s approvals,” Flinders University professor of hydrogeology Adrian Werner said. He is a founding member of National Centre for Groundwater Research and Training.

Instead Prof. Werner, with Flinders associate professor Andy Love, Dr Eddie Banks and Dr Dylan Irvine – with associate professor Matthew Currell from RMIT University, Prof. Ian Cartwright from Monash University and associate professor John Webb from Latrobe warn the springs face a "plausible threat of extinction".  

“Six years of advice from experts that the science is flawed does not seem to have overcome critical shortcomings with the science that have persisted despite several iterations of Adani’s environmental management plans,” Prof. Werner said.

“With the deadline for approval approaching, we are compelled to reiterate concerns that flaws in Adani’s scientific methods, modelling results, and the proposed ‘adaptive management’ approach by Adani have the potential to seriously mislead decision-makers,” he says pointing to the 2013 Independent Expert Scientific Committee report, Land Court case of 2014-15 and this year’s CSIRO review.

Prof. Werner said,  “We hope that our report assists the Queensland Government by highlighting the significant risk that the Carmichael Mine will cause the Doongmabulla Springs to become extinct, and will impact other groundwater-dependent ecosystems and water users to a greater degree than has so far been suggested by Adani.”

The report pinpoints four areas where Adani’s investigation and environmental management strategies do “not stack up against the science”:

• Adani appears likely to have significantly underestimated future impacts to the Doongmabulla Springs Complex, the university researchers said.
• Should the Carmichael Mine cause springs within the Doongmabulla complex to cease flowing, the impact could be permanent, they claimed.
• Adani’s safeguard against the impacts, namely ‘adaptive management’, is unsuitable and unlikely to protect the springs from extinction is teh professors' assessment; and 
• Cumulative impacts to the springs that may result from other mining activities in the Galilee Basin have not been adequately considered, in their opinion.

www.flinders.edu.au

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