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Small business sector slugged by rising power prices

THERE IS mounting evidence that small businesses are bearing an unfair higher share of rising electricity prices.

Australian Small Business and Family Enterprise Ombudsman, Kate Carnell, says submissions to the ACCC electricity pricing inquiry confirm anecdotal accounts that small businesses are being gouged.

Ms Carnell said while households in several states are grappling with price increases of 15-18 per cent, for most small businesses it’s above 20 per cent, with higher rises forecast next year.

“It’s totally unacceptable that energy-dependent small businesses like manufacturers and rural industries are being slugged more than householders and big business,” she said.

“The energy system is broken and needs to be fixed, but we can’t afford to see businesses close and jobs lost while governments and energy companies get their act together.”

Ms Carnell cited examples from submissions to the ACCC inquiry:

Printing Industries Association of Australia

Feedback from our members shows individual increases in electricity prices which include $20-30,000 a month; increases over the previous 12 months (or a comparable period) of 25%, 35%, 48%, 67%. One large-sized Melbourne-based print member will face an electricity bill increasing threefold (from $120k per annum to $360k) once its existing contract expires on 31 December 2017. Many of our members have incurred these increases despite decreasing the amount of electricity they use.

South Australian Wine Industry Association

We are aware of one larger winery that had invested nearly $400,000 in energy-efficiency improvements and solar power that reduced costs by around $120,000 per year, only to then face an increase in electricity cost of 160% in one year amounting to $250,000 – a cost that comes straight off the bottom line.

Alba Cheese Manufacturing (Melbourne)

All electricity retailers we have dealt with provide complex pricing arrangements which make it hard to make comparison between the various offers. In discussion with energy retailers they focus on the energy rate and blame energy suppliers for the cost increases, they gloss over their own charges and dismiss them as being “beyond their control”. Analysis of electricity charges over the last five years shows that network charges rose by an annual rate of 25.9% over the period whilst energy charges rose 21.3% per annum.

Business SA case study: Regional feed mill JT Johnson & Sons

JT Johnson runs a regional exporting business, centred around the export of hay and pellets to Middle Eastern and Asian fodder markets. In mid-2016, and after just having undergone a major upgrade of its power infrastructure, JT Johnson’s total energy bill increased from $800,000 to $1.6 million after its wholesale energy peak price trebled from 6.4 cents to 19.3 cents.

Tasmanian Small Business Council

The wholesale forward price for 2016-17 back in May 2015 was trading around $43.50/MWh and then 12 months later for the same period was trading at $59.60/MWh, a 37% increase in costs. For a contestable customer consuming 100,000MWh per annum, this cost increase would have been in the order of an additional $1.7 million. For a customer consuming 200MWh per annum, such as a school or medium-sized business, the additional cost would be $3400 per annum.

Ms Carnell said the submissions expressed small business concerns with lack of retail competition; complexity around price comparisons and billing; transparency, and disincentives to reduce consumption.

“I’m deeply concerned that small businesses appear to be victims of profiteering by electricity companies,” she said.

“I welcome the NSW Business Chamber suggestion of an industry code to provide minimum standards for energy retailers.

“These standards could be designed to provide a common basis for comparisons between offers, a minimum length of time to consider retail offers and requirements for greater transparency with billing.”

www.asbfeo.org.au

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2017 eftpos ARA Australian Retail Awards speakers announced

THE Australian Retailers Association (ARA) has announced Radek Sali of Swisse as keynote speaker at the 2017 eftpos ARA Australian Retail Awards next week.

The eftpos ARA Australian Retail Awards are the retail industry’s longest running recognition of success, and this year will take place at the Great Hall, National Gallery of Victoria in front of 550 retailers on August 3 in Melbourne.

Radek Sali is an accomplished leader of international business, having made his mark as CEO of household name Swisse in his early thirties. Radek is credited to have led Swisse through rapid growth in product lines, stockists and revenue, and initiated one of Australia’s largest ever licencing deals with PGT, with plans to launch Swisse in over 30 countries in three years across Europe and Asia.

Russell Zimmerman, ARA Executive Director, said the Awards Breakfast is an opportunity for all Australian retailers to come together to celebrate the success of their peers, network, and learn from other’s experience.

The 2017 eftpos ARA Australian Retail Awards will also be hosted by esteemed ABC journalist Beverley O’Connor.

“To have Radek on board to share the journey and learnings behind his success is a real advantage, and Beverley will only add to the atmosphere of celebration and industry support we expect the 2017 Awards to provide to retailers,” Mr Zimmerman said.

With the Top 20 retailers already shortlisted for the coveted 2017 Retailer of the Year Award, tickets to attend the 2017 Awards Breakfast have already sold out, so keep your eyes peeled for the winners to be announced post event.

About the eftpos ARA Australian Retail Awards

First held in the 1970s, the eftpos ARA Australian Retail Awards are the nation’s longest running and most prestigious retail event, recognising and rewarding outstanding retail businesses, innovations, and individuals across all sectors of retail. Relaunched in 2008, the annual 2017 eftpos ARA Australian Retail Awards breakfast will commence on Thursday 3 August at Melbourne’s National Gallery of Victoria.

About the Australian Retailers Association

Founded in 1903, the Australian Retailers Association (ARA) is the retail industry’s peak representative body representing Australia’s $310 billion sector, which employs more than 1.2 million people. The ARA works to ensure retail success by informing, protecting, advocating, educating and saving money for its 7,500 independent and national retail members throughout Australia. For more information, visit www.retail.org.au or call 1300 368 041.

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IPA calls for ATO service commitment to improve accountability

THE Institute of Public Accountants (IPA) has called for greater accountability from the ATO in light of the ongoing technology issues that have significantly impacted accountants and small businesses across Australia.

“The IPA has constantly heard the plea of our members who have suffered ongoing IT issues with the ATO,” said IPA chief executive officer, Andrew Conway.

“We know that the ATO is doing whatever it can to rectify the failing functionality of its IT systems but apologies do not undo the pain that it is inflicting.

“While some of our members have called for compensation, we are realistic in our expectations.  However, it should be recognised that accountants and tax agents have worn the brunt of this issue over many years.

“Whilst clients of tax practitioners are generally not disadvantaged, very little concessions are granted to the tax practitioners themselves.

“To give context to the significance of this issue, 74 percent of taxpayers go to a tax agent to look after their affairs and 95 percent for businesses.  Consequently, our members do the heavy lifting and are reliant on the ATO systems to service their clients.

“While the ATO is pursuing a digital by default strategy, stakeholders need systems available 24/7.

“As a result of the ongoing system issues, our members have experienced reputational damage with their clients along with loss of productivity.  These factors play a big part in the status of their mental health and wellbeing.

“When critical systems go down, client appointments get cancelled, support staff lay idle and backlogs start piling up.  When there is a major outage, everything grinds to a halt.

“We believe there should be a service commitment from the ATO; an agreement where there are specified and agreed service levels and if those service levels are not met, penalties should apply. This would be akin to arrangements that operate in the commercial world with critical service providers.

“Our members are subjected to key performance benchmarks when it comes to lodgements so it is not unreasonable to ask that the ATO has its own benchmark to improve accountability around IT service delivery,” said Mr Conway.

 

publicaccountants.org.au

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Labor's trust issues - Chartered Accountants

CHARTERED Accountants Australia and New Zealand has called on the Australian Labor Party to embrace indirect tax reform if it is to develop the sustainable tax base necessary to pay for the many important social investments outlined by Opposition Leader Bill Shorten in his speech today (July 30).

Head of Tax, Michael Croker, said Chartered Accountants ANZ would continue to advocate for a broad base, low rate personal tax system, with greater reliance on indirect taxes such as GST and stronger measures to address tax evaded in the black economy.

Mr Croker noted Mr Shorten’s references to inequality but expressed disappointment over the lack of a comprehensive plan to tackle this issue by more broadly reforming Australia’s tax and transfer payment systems.

“What we’re seeing from the major parties is a piecemeal approach, with a bit of extra income tax tacked on here and a specific deduction denied there,” Mr Croker said.

“The message conveyed is that something is being done to someone else to tax them more heavily.

“Meanwhile, Australia’s income tax system remains dangerously over-reliant on PAYG collected from Australians in the top tax brackets and company tax paid by a comparatively small group of large companies.”

Nonetheless, Chartered Accountants ANZ had already spoken to Andrew Leigh’s office and offered to work with the ALP to flesh-out its 30 percent minimum tax proposal for discretionary trusts before the next Federal Election.

“Today’s speech and accompanying Fact Sheet are light on specifics for a legitimate structure used widely for business, personal investment and family purposes,” Mr Croker said.

“Accountants and their clients seek certainty, particularly when new policies impact existing structures established in accordance with laws now described by those who enacted them as unfair.

“There are already a number of emerging questions about Labor’s model”, he said.

They include:

•   The equity of treating active small businesses differently from farmers.

•   Addressing the potential for over-taxation (compared to the tax outcome if the beneficiary simply derived the income directly), particularly for business trusts.

•   Restructuring relief for those who may wish to exit discretionary trust structures.

•   The scope of carve-outs for farm trusts, testamentary, disability and charitable trusts.

Mr Croker said Labor’s minimum tax would start many conversations, and said there could be concern in some quarters that minimum tax might be embraced for other taxpayer segments.

He said Chartered Accountants in Australia would be disappointed by the disparaging references to their profession in Mr Shorten’s speech today.

“With his parliamentary and ministerial experience, Mr Shorten knows better than most the role CAs play in helping Australians and businesses prosper. He would also know that Chartered Accountants ANZ is a highly trusted contributor to consultation forums established by government and regulatory agencies such as the ATO, advocating in the public interest.” 

www.charteredaccountantsanz.com

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Bill Shorten to speak at Vodafone National Small Business Summit

LEADER of the Opposition, Bill Shorten MP, has been confirmed to speak at the Vodafone National Small Business Summit, hosted by the Council of Small Business Australia (COSBOA) taking place at the Events Centre Collins Square, Melbourne on 23-25 August 2017.

Mr Shorten will open the Summit Breakfast on Friday, 25 August and discuss current issues facing more than two million small businesses across Australia.

Peter Strong, CEO of COSBOA commented on the privilege to host Mr Shorten at Australia’s premier policy event discussing the current and future needs of small business owners.

“We are honoured to welcome Mr Shorten to speak at the Vodafone National Small Business Summit for the third year. 

“In 2017 the Summit will focus on ‘Collaboration and Communities’ and discuss how senior politicians, policy makers and industry leaders can come together to build and strengthen partnerships and secure the future of small business growth in Australia,” said Mr Strong.

Program highlights include:

Small Business Banking and Finance, with:

  • Hon. Philip Dalidakis, Minister for Small Business, Innovation and Trade
  • Kate Carnell, Australian Small Business and Family Enterprise Ombudsman
  • Anna Bligh, CEO, Australian Bankers' Association
  • David Gandolfo, Deputy Chair, COSBOA

Big and Small Working Together, with:

  • Jennifer Westacott, Chief Executive, Business Council of Australia
  • Grant King, President, Business Council of Australia
  • Paul Nielsen, Director and Chairperson, COSBOA

Our Regulators – Can Their Jobs be Easier and Will That Make Our Jobs Easier?  with: 

  • John Price, Commissioner, Australian Securities and Investments Commission
  • Natalie James, Fair Work Ombudsman
  • Dr Michael Shaper, Deputy Chair, Australian Competition and Consumer Commission

Export Opportunities And Other Business Via The Web, with:

  • Richard Flanagan, Head of Business Marketing, Google Australia and New Zealand

The Role of Business Associations in Modern Society, with:

  • Justice Iain Ross, President, Fair Work Commission
  • Sandy Chong, CEO, Australian Hairdressing Council and Director, COSBOA
  • John Hart, Executive Director, Restaurant & Catering Australia
  • Julie Owens MP, Shadow Assistant Minister for Small Business

Registrations are open for the Vodafone National Small Business Summit. For more information please visit: www.cosboansbs.com.au

To celebrate the commencement of the Summit, Small Business owners are invited to attend the Small Business Start-Up Reception from 6pm-8pm on Wednesday, 23 August 2017. The event will provide an opportunity for owners to hear from Peter Strong, CEO of COSBOA and network with industry leaders and key decision makers. A panel on the evening will highlight the next generation of employers and innovators and discuss what more our education system can do to support entrepreneurship.

 

Committee launches inquiry into regional development and decentralisation

THE Select Committee on Regional Development and Decentralisation is calling for submissions to its inquiry.  The Committee will examine best practice approaches to regional development, the decentralisation of Commonwealth entities, and supporting corporate decentralisation.

Committee Chair, Dr John McVeigh MP said, “The Committee’s inquiry is wide ranging and will explore ways to increase the growth and prosperity of regional and rural Australia.  While decentralisation of Commonwealth entities has been identified as a potential means to achieve this, the Committee wants to examine, more broadly, how public and private investment can assist in building and sustaining our regional communities.

 “So much of our economic success rests in the resources and work of our regional towns and cities. It is important that we examine ways to better support these communities and to strengthen their social and economic future.”

The Committee plans to hold public hearings across regional Australia to learn more about best practice approaches to regional development, and decentralisation opportunities.

Submissions to the inquiry will close on Friday 15 September 2017.  To make a submission, visit the Committee’s website and follow the prompts. The Terms of Reference can also be found on the Committee’s website, or by contacting the Committee Secretariat.

An issues paper is expected to be tabled in Parliament on 31 August 2017.

Interested members of the public may wish to track the committee via the website. 

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Film and television industry inquiry arrives in Melbourne

THE House of Representatives Standing Committee on Communications and the Arts will conduct a public hearing in Melbourne this week as part of its inquiry into factors contributing to the growth and sustainability of Australia’s film and television industry.

The Chair of the committee, Mr Luke Howarth MP, stated that ‘we will be hearing the perspectives of the Victorian Government and other agencies and businesses based in Melbourne.’

‘The Committee looks forward to discussing the challenges and opportunities facing our film and television industry with these key participants’ added Mr Howarth.

Public hearing details: 9.15am-3.30pm, Wednesday, 26 July 2017,
Meeting Room G6, Victorian Parliament Offices, Ground Floor, 55 St Andrews Place, 
East Melbourne

9.15am       Victorian Government
10.00am     Entertainment Assist
10.45am     Village Roadshow Limited
11.45am     Victorian Film & Television Industry Working Party
12.15pm     Iloura
1.30pm       Studio Moshi
2.00pm       Melbourne International Film Festival
2.30pm       White Hot Productions Pty Ltd
3.00pm       Australian Children's Television Foundation
3.30pm        Finish

The hearing will be broadcast live at aph.gov.au/live.

Interested members of the public may wish to track the committee via the website. 

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Easier flying in to US market

AUSTRALIA’s aviation industry – including manufacturers and service companies – now has easier and cheaper access to the lucrative United States aviation market, after the signing of amendments to the bilateral aviation agreement.

Federal Minister for Infrastructure and Transport Darren Chester said the amendments would be a significant benefit to Australian aviation parts and products designers and manufacturers. Mr Chester said the changes would also benefit Australian companies and individuals who export aircraft and aircraft products to the US.

“There are more than 40 Australian aviation design organisations and more than 80 aviation production organisations that will have lower costs and less red tape when exporting to the US market,” Mr Chester said.

“A range of Australian design and manufacturing approvals will now be accepted in the US without the need for additional and sometimes costly work.

“People and organisations wanting to sell their aircraft into the US should have fewer regulatory hurdles to contend with.

“These amendments save money and streamline regulatory requirements without in any way compromising safety standards.

“I know that many large and small aviation organisations have been eagerly awaiting these changes so they can make greater inroads into the huge US aviation market.”

The amendments have been made to the Implementation Procedures on Airworthiness made under the Bilateral Aviation Safety Agreement between Australian and the US.

www.infrastructure.gov.au/transport

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More pulling power for the north

THE VOICE of Northern Australia has been further strengthened, with the first meeting on July 20 of the Northern Australia Advisory Council in Townsville.

Minister for Resources and Northern Australia, Senator Matt Canavan, said the Council would provide a direct link to Government for the regions of the North to provide regular updates about issues, projects and priorities.

“The members of this Council know what makes Northern Australia tick.  They represent a wide range of industries that are essential for the jobs and economic wellbeing of the North,” Minister Canavan said.

“Our Government takes Northern Australia seriously. We have Members and Senators across the North. I’m proud to live in Northern Australia and I regularly visit the towns and communities across all parts of this expansive region.

“But we know the best way to deliver for Northern Australia is to listen to the people who create the jobs and run the local businesses.”

The first council appointees are:

  • Councillor Jane McNamara, mayor of the Flinders Shire
  • Mr Nigel Browne, a Larrakia and Wulna man, Larrakia Development Corporation chief executive officer
  • Ms Nicole Roocke, Chamber of Minerals and Energy of Western Australia deputy chief executive
  • Ms Colleen Costello, pastoralist
  • Mr Col McKenzie, Association of Marine Park Tourism Operators chief executive officer and marine tourism consultant
  • Miss Leesa Jeffcoat, Diocesan director, Catholic Education, Diocese of Rockhampton
  • Councillor Peter Long, mayor of Karratha, engineer and environmental scientist

The Council will advise on issues including industry development, Indigenous employment, infrastructure and long-term planning.

“We are delivering on our plan for developing Northern Australia. We’re investing in the roads, dams and infrastructure that will create new opportunities and support new industries,” Minister Canavan said.

“I look forward to working with this Council as we build on these investments.”

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Tourism inquiry visits the Northern Territory

PARLIAMENT’s Northern Australia Committee will hold public hearings in the Northern Territory on Sunday 23 July, Monday 24 July, and Thursday 27 July 2017 at Yulara, Alice Springs, and Darwin as part of its inquiry into Opportunities and Methods for Stimulating the Tourism Industry in Northern Australia.

The Northern Territory is home to three of the most well-known tourism icons in the world—Uluru/Kata Tjuta National Park, Kakadu National Park, and Nitmiluk National Park (Katherine Gorge). The Territory has many other attractions and a wealth of untapped tourism potential. The Committee will hear evidence from the Northern Territory Government, a range of tourism operators, national parks officials, and traditional owners.

The Committee Chair, Warren Entsch MP, said Northern Australia has many places with great tourism potential, but which are generally unknown to the travelling public.

“As the bitumen rolls out on many of the northern roads, drive tourists will follow, eager to experience the beauty of Northern Australia,” he said.  

“The Committee has learned that cultural tourism is high on the wish list of many international tourists, but there is relatively little on offer when they arrive.

“While much effort is spent on promoting Australia’s tourism icons to the world, there needs to be a corresponding emphasis on developing new tourism businesses especially in cultural tourism and especially in regional and remote Australia,” Mr Entsch said.

 

Public hearing details:

3:15 pm to 5:45 pm, Sunday 23 July, Wanari Room, Uluru Meeting Place (adjacent to Sails in the Desert Hotel), Yulara Drive, Yulara

1:00 pm to 4:45 pm, Monday 24 July, Andy McNeill Room, Civic Centre Complex, 93 Todd Street, Alice Springs

8:00 am to 3:20 pm, Thursday 27 July, Litchfield Room, NT Legislative Assembly, Mitchell Street, Darwin

The hearing will be broadcast live  (audio only) at aph.gov.au/live

The hearing program and further information about the Committee’s inquiry, including submissions and the terms of reference, is available on the Committee’s website: www.aph.gov.au/jscna.

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Industry welcomes North West blueprint - QRC

THE Queensland Resources Council (QRC) has welcomed the state government’s ongoing commitment to the development of the mineral rich North West Minerals Province as a major driver of prosperity in North Queensland.

QRC Chief Executive Ian Macfarlane said the targeted incentives announced by Minister Lynham would encourage investment and deliver jobs for regional communities.

“The QRC commends the Palaszczuk government on its proactive and consultative approach by working with industry, local government, unions and the community to ensure all stakeholders were considered in mapping out this blueprint for the North West,” Mr Macfarlane said.

“Locating a hyperspectral logger in Mount Isa at the government’s existing drill core facility is an excellent initiative. It’s a simple practical approach that can deliver cost savings and efficiencies for explorers in the region.

“Already one of the world’s largest zinc companies Teck has been granted a tenure to explore 102km2 near Cloncurry which would be a huge short in the arm for the local economy.”

Newly appointed Queensland Exploration Council (QEC) Chairman, Brad John said the blueprint would attract investors both domestically and from overseas.

“It was pleasing to see the Minister announce an investor forum in Townsville which recognises the significant level of economic activity that is driven out of the North West and the Port of Townsville,” Mr John said.

The state’s North West has the potential to unearth vast amounts of copper, zinc and gold which are the minerals used in new technologies including batteries, mobile phones and solar panels.

“Last year the QRC launched its ‘Resourcing Innovation’ campaign about the importance of minerals for new cutting edge technologies and the state’s contribution to the future of these technologies could be secured with the North West,” Mr Macfarlane said.

The blueprint includes the Resources Development (Royalties) Policy and builds on the work of the Collaborative Drilling Initiative. In previous years this initiative had been a staggering technical success for exploration, specifically the discovery of mineral occurrences in Queensland.

www.qrc.org.au

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