THE Australian Small Business and Family Enterprise Ombudsman Kate Carnell has welcomed the Federal Government's mid-year budget update (the mid-year economic forecast outlook, MYEFO), saying it contained some welcome gifts for small businesses.

“It’s encouraging to see the Federal Government has allocated funds to establish the national payment times reporting framework,” Ms Carnell said.

“The framework will require large businesses to publish information about their payment policies, including how much time it takes to pay their small business suppliers.

“Critically, the government will provide $156.2 million over four years to streamline regulatory compliance processes and cut the cost of doing business.

“This includes the creation of a single national business register and the introduction of Director Identification Numbers," Ms Carnell said.

“We also welcome continued efforts by the government to combat illegal phoenixing behaviour. Illegal phoenixing not only hurts small businesses, it costs the economy as much as $3 billion per year. 

“The government will spend $10 million over two years on its deregulation agenda to make it easier for small businesses to employ staff and invest in growth.

“A new online checklist will provide small business employers with a guide to employing their first worker, along with a commitment to developing a new prototype ‘regtech’ platform.

“Funds have also been committed to extend the free tax clinic program, following a successful pilot program," Ms Carnell said.

“While small businesses will still use the tailored and comprehensive advice of their accountant or bookkeeper, there are many Australian microbusinesses that would benefit from additional support in understanding their tax and superannuation obligations.

“Of course, in the May 2020 Budget there are a number of items on our small business wish list, beginning with the extension of the instant asset write-off scheme.

“A lift in the $30,000 threshold for the instant asset write-off would be welcome with some industries such as farming requiring a higher threshold to enable them to purchase equipment," she said.

“We also want to see some funds towards implementing the recommendations in the Joyce review, so that small businesses can get the staff they need with the right skills and training.

“At the end of the day, small businesses just want to be able to get on with the job of growing their business," Ms Carnell said.

“We will continue to talk further with the government on measures that will benefit the small business sector and stimulate the economy.”

www.asbfeo.gov.au

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AUSTRALIAN executive employment has had its equal biggest fall in 12 months as banks continue to block business lending and economic growth sputters, according to the highly accurate indicator of Australian executive employment trends, the E.L Executive Demand Index.

The EL Index fell 6 percent in November, its lowest position in 2019.

Grant Montgomery, managing director of search firm EL Consult that publishes the EL Index, said, “Employment opportunities for executives fell heavily this month bottoming out the year in a clear warning call for Australia’s overall employment trends."

A fall in the index indicates a weakening within 3-9 months, he said.

“It has been a year of correction, with the Reserve Bank trying to chase after the economy to keep it moving by lowering rates, and at the same time trying to jawbone the economy higher by pleading with companies to lower their hurdle rates for new investment," Mr Montgomery said.

“But the real problem for is that small business, which accounts for 57 percent of Australia’s GDP, is being held in a massive credit squeeze. 

“Recent denials by ASIC and AFIC that the post Royal Commission new “responsible lending’ rules do not apply to business lending is as ignorant as it is wrong.

“The truth is that banks in their highly protected comfortable environment have never actually lent to business but have lent against property for business purposes," Mr Montgomery said.

“The distinction here means they have no skills or capacity to differentiate or assess a business loan outside the lien they put on a property. So as soon as the regulators bought in 'responsible' lending the banks naturally applied the higher interest cover rules.

“This is not how business works.

“If someone has a highly innovative piece of technology and wants to set up a business, they used to get bank funding by putting their house on the line. As a new business with a high potential has very little income on inception. 'responsible lending' means they can no longer get funding to start.

"Even existing businesses rarely have consistent week on week or year on year incomes and if they seek funds for a tight period such as during drought the banks have no ability to assess the risk outside of morphing the 'responsible' lending rules and consequently refusing to lend regardless of the backing security.

“The whole small business sector isn’t spending or investing money. Ill-conceived borrowing rules are affecting innovation and entrepreneurship and it represents around half of the Australian working population or more than 5 million people. It is very easy to see why there are very few pay rises and very little wages growth," he said.

"Maybe the Federal Government very recently was trying to address this and spark innovation lending by setting up a venture capital lending vehicle. They had to drag the banks kicking and screaming into it -- unlikely to change anything. Its initial funding by a pool of $200 million is totally inadequate and ultimately won’t work because, you guessed it, Australian banks have absolutely no skills outside of property lending. 

“December last year saw a large fall, through seasonal factors, so we are on tenterhooks to see if the same thing will be repeated this year.” 

The good news is that the information technology sector was the standout winner for the month, following on from two months of sizeable falls," according to Mr Montgomery.

“Spending on technology will continue to be the focus of cost-conscious business. What’s more technology, especially online spending has now captured more and more of the marketing budgets,"he said. 

“The shift to the cloud is a further growth example as more and more business ditch their own hard storage. The downside of IT spending is of course that it ultimately saves jobs and employment falls.

“Still many have being predicted a crisis but that is unlikely to occur unless technology reaches a pinnacle of development with every advancement possible completed. Not going to happen!" Mr Montgomery said.

All of the other sectors put in negative results, with Engineering registering the biggest loss. New South Wales was again the strongest state during the month, almost pulling off a positive result thanks to gains in IT and Management.

About the E.L Index
The E.L Index is a comprehensive monthly analysis of employment trends at executive level. An Australian analysis is produced in Sydney and an Asian analysis in Hong Kong and Singapore. The E.L Index has shown by two separate University studies to correlate strongly with general economic and business trends. It is featured by most of the major news services and is closely followed by government and central bank analysts. The E.L Index is actually a combined national index of all executive demand made up of five separate indices; E.L Finance Index, E.L IT Index, E.L Management Index, E.L Marketing Index and the E.L Engineering Index.

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NEW proceedings launched by the Australian Building and Construction Commission (ABCC) following threats to deploy “old school” tactics of blocking concrete pour during the construction of an aged care centre shows the need for “new school” Ensuring Integrity laws to stop building union bullying. 

The latest proceedings flow from events during the construction of an aged care facility in which building unions allegedly failed to show entry permits on two separate occasions. The building union officials then allegedly issued a series of demands which, when resisted by the employer, caused the officials them to block entry to the site. This followed comments from the officials in which they allegedly said ‘we’ll do it old school’ while making gestures including running a finger across their throat. 

Master Builders Australia CEO Denita Wawn said this case is one of a spate of reports involving building unions tackling concrete companies during crucial stages of construction, mainly concrete pours. 

“Shutting down a construction site during a concrete pour is one of the oldest tactics deployed by building unions as it causes maximum disruption,” she said. 

“As one of the individuals involved allegedly stated, this is indeed an ‘old school’ tactic but yet it continues again and again,” Ms Wawn said. 

“The fact that even building unions allegedly refer to the tactic as ‘old school’ show exactly why we need the Ensuring Integrity laws – a ‘new school’ approach to tackling a decade’s old problem.

“Clearly there are some organisations and their officials who continue to repeatedly and deliberately break workplace laws and they show no signs of stopping – which is exactly why Parliament should support the Ensuring Integrity laws when it resumes next year,” Ms Wawn said. 

“The Ensuring Integrity laws will ensure that everyone plays by the rules and introduce real consequences for those who don’t. We need these laws so that these ‘old school’ tactics become exactly as the name suggests and are consigned to the dustbins of history.

“Registered organisations and their officials enjoy a wealth of rights and privileges under the Fair Work laws and, given these protections. There is no need to constantly break the laws to represent your members. But building unions do it over and over again and it will only get worse. Its cases like these that show exactly why we need the Ensuring Integrity laws,” Ms Wawn. 

www.masterbuilders.com.au

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THE Parliamentary Joint Committee on Intelligence and Security (PJCIS) has received detailed new evidence to its Inquiry into the impact of the exercise of law enforcement and intelligence powers on the freedom of the press which has necessitated a further extension to its reporting timeframe.

Australia’s Right to Know (ARTK) coalition of media companies tendered a supplementary submission to the PJCIS’s inquiry on Tuesday, one week before the Committee intended to deliver its report. This submission and its attachments contain detailed proposed amendments to fundamental parts of Commonwealth law enforcement and intelligence legislation.

The Committee also expects to soon receive a further submission from the Department of Home Affairs and the Australian Federal Police.

The chair, Andrew Hastie MP, said, "The Committee has been working to thoroughly consider the issues presented to it since July. This late submission from ARTK provides additional detailed evidence on the position of the major media stakeholders to this inquiry.

"The Committee also expects to receive a further submission from relevant Government agencies. The Committee will therefore not report next week but will wait to properly consider these new submissions."

The deputy chair, Anthony Byrne MP, said, "The complexity of the issues being considered in this inquiry has challenged the Committee’s ability to deliver a report in the timelines it was provided, and even within the timelines it has set for itself.

"In order for the Committee to consider this new detailed evidence and test government and societal opinion for the proposals put forward, the Committee will have to extend its inquiry timeline into next year."

Mr Hastie added, "The Committee will consider this new evidence and expects to report early in the new year."

Further information on the inquiry can be obtained from the Committee’s website.

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