THE Australian Small Business and Family Enterprise Ombudsman Kate Carnell is calling on the Federal Government to establish a small business procurement panel. She said it will acce;lerate the way small businesses will play a critical role in the post COVID economic recovery,

The panel, proposed in ASBFEO’s COVID-19 Recovery Plan, would require Federal Government contracts, with a value of up to $10 million, to be offered through the small business panel as part of the tender process, before being opened to the wider market.

“The government has a golden opportunity to improve its procurement process to support the creation of jobs in the small business sector,” Ms Carnell said..

“The total number of Commonwealth Government contracts awarded to SMEs in 2018/19 was 26 percent. However 94 percent of government contracts are valued under $1 million with 59 percent below $80,000. It is clear small businesses could have a larger share of that pie.

“Unfortunately current government procurement processes preference large businesses. 

“A procurement system that discourages small business participation, won’t necessarily get the best value and also denies small businesses the opportunity to innovate, employ and grow," Ms Carnell said.

“I was encouraged to see Federal Industry Minister Karen Andrews’ commitment to speak with the Prime Minister about the importance of using government procurement as a lever to building Australian capability and to bolster supply chains in the tech sector.

“Minister Andrews is absolutely correct. In fact, we believe this should be extended beyond the tech sector to small businesses more broadly, including manufacturing," Ms Carnell said.

“Small businesses still face significant barriers when participating in government procurement. It can be a costly exercise and small businesses don’t have the resources to complete overly complex tender documentation. The challenges of getting on to a panel in the existing system are onerous.

“Equally small businesses are often overlooked on the ‘value for money’ criteria. Just because they might not be able to offer the lowest price, doesn’t mean they are not competitive overall.

“Lowest cost is not always the best value for money. There’s a strong argument that prioritising Australian small businesses pays dividends to the entire economy.”

www.asbfeo.gov.au

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THE Financial Services Council (FSC) has developed a report Accelerating Australia’s Economic Recovery - which offers new policy ideas as well as solutions to older, intractable problems, to assist economic growth, and also help people manage their own financial challenges during the current economic downturn.

FSC CEO Sally Loane said the centrepiece of the FSC’s report is an initiative to fully utilise Australia’s $2.7 trillion pool of retirement savings – new investment vehicles to expand and democratise investment in critical domestic infrastructure, making these projects accessible and attractive to every Australian with money in superannuation.

She said FSC saw that after steering Australia successfully through its most serious health crisis in a century, the National Cabinet faced the daunting challenge of creating jobs and getting Australia back to work and "the financial services sector must be part of this critical recovery operation". 

“The new Australian Superannuation Infrastructure Investment Vehicles (ASIIVs), will unlock a large chunk of funds - around $1.7 trillion in choice and Self-Managed Superannuation Funds (SMSFs) - for infrastructure projects from investors who today have limited access to them,” Ms Loane said.

“ASIIVs will allow National Cabinet to turbocharge asset recycling programs by selling assets into a common vehicle to finance new job-creating infrastructure projects. They will also enable the creation of tailored vehicles for greenfield projects, such as community housing.”

Accelerating Australia’s Economic Recovery also recommended that the National Cabinet:

  • Abolish stamp duties on life insurance products and property transactions. Stamp duties on life insurance cost Australians $644 million each year and erode superannuation savings by $235 million each year through their application to group insurance policies;
  • Align the company tax rate to 25 percent for all companies. The cut in the company tax rate for small businesses has had a positive impact on employment and investment, and the same incentives to invest should exist for all Australian companies;
  • Establish a co-contribution scheme for Australians who have accessed the ‘early release’ hardship scheme and need to top up their superannuation. The Federal Government would contribute $1 for every $5 a member contributes, up to a maximum $10,000 in member contributions;
  • Older Australians be offered a once-off higher superannuation cap of $50,000, to be ‘carried forward’ if unused;
  • Encourage business investment to modernise outdated financial products through a specialised tribunal, aimed at lowering the cost of financial advice for Australians;
  • Accelerate the Significant Investor Visa (SIV) program to support migration and build on the $11 billion it has already contributed to direct investment; and
  • Remove legislative barriers so life insurers can fund medical treatment to help injured Australians get back to work.

“The FSC and its members want to help drive Australia’s long-term economic recovery," Ms Loane said.

"By implementing the reforms raised in this report, the National Cabinet and Commonwealth Government can get the best bang for the nation’s buck and get Australia back up on its feet.”

A copy of the full report can be found on the FSC website.

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THE Australian Small Business and Family Enterprise Ombudsman, Kate Carnell has welcomed legislation passed by the Federal Government overnight, that will see thousands of small businesses receive the JobKeeper payment from early May.

The flat payment of $1,500 per fortnight per eligible employee will be delivered by the Australian Taxation Office (ATO), assisting small businesses pay their staff that continue to work as well as staff that have been stood down since March 1, 2020.

Small businesses, including sole traders, which have an annual turnover of less than $1 billion and estimate their turnover has fallen or will fall by 30 percent or more are eligible for the subsidy. 

“The government’s $130 billion JobKeeper scheme is the biggest financial lifeline Australia has ever seen and I congratulate parliament for passing the legislation with bipartisan support,” Ms Carnell said.

“The JobKeeper payment is critical to the survival of small businesses that have been impacted by the COVID-19 crisis.

“Crucially it will allow small businesses to continue operating and paying their staff. It will also keep small businesses connected to their staff, who have been stood down, so they can re-engage their team when the time comes to ramp up," Ms Carnell said.

“There has been a lot of confusion out there about eligibility for JobKeeper, but the intent of this policy is to be inclusive of small and micro-businesses under financial strain in this difficult time. That includes sole traders, partnerships, contractors, freelancers and trusts.

“My message to small businesses is – if you think you might be eligible, visit the ATO website and express your interest. You just need your ABN and contact details. The ATO will get back to you," she said.

“Importantly, small businesses that have signed up for JobKeeper will need to make the payments now before they are reimbursed by the ATO in May.

“Above all, we know that there’s never been a tougher time to be in business, but the JobKeeper package provides the practical financial support and the hope small businesses need as we wait for this health crisis to pass.”

www.asbfeo.gov.au

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THE Australian Small Business and Family Enterprise Ombudsman Kate Carnell has welcomed Prime Minister Scott Morrison’s COVID-19 business hibernation plan, flagged today.

“The only way for small businesses to survive the coming months is if they can effectively hit pause for the time being,” Ms Carnell said.

“For businesses to bounce back when this health crisis is over, they need a holiday from all costs that they incur during this extremely difficult period. 

“Small businesses – including those that are forced to shut their doors as well as those who suffer a significant loss of income – should be able to go into business hibernation. 

“Understandably, the details of the government’s business hibernation plan are still being considered. It’s a mammoth effort that requires everyone to come together and be a part of the solution," Ms Carnell said.

“Landlords, utility and service providers, telecommunications and all levels of government will need to put their fees and charges on hold or face losing that customer altogether if there is a tidal wave of insolvencies.

“Part of this needs to be a wage subsidy for staff that remain attached to the business. Those staff would need to be paid at least 60 percent of their wage up to a maximum monthly amount. This of course would need a minimum safety net built in.

“My office, as always, is working with the small business community to ensure we are advocating for the best way forward.

“Small businesses are the engine room of the Australian economy and need our support more than ever right now.

“We are at a critical tipping point, but we can get through this if we work together.” 

www.asbfeo.gov.au

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The Institute of Public Accountants (IPA) has issued a warning to employers that a loophole, which has seen wage theft in relation to superannuation guarantee (SG) rules in the past, is no longer.

“The IPA had originally advocated for the measure to be brought forward from its proposed start date of 1 July 2020, to the start of this financial year namely 1 July 2019,” said IPA chief executive officer, Andrew Conway.

“We were pleased that the Senate at least partly agreed with our position, and recommended the measure be brought forward to 1 January 2020.  

“The loophole came about where an employee salary sacrificed into his or her superannuation and the employer used that contribution to form part of the employer’s obligation to pay the 9.5 percent SG," Mr Conway said.

“Those employers who were doing the wrong thing by their employees can no longer get away with it.  As of 1 January 2020, employers cannot use employee salary sacrificed contributions to fulfill employer SG commitments.

“We would encourage employees to consider salary sacrificing into their superannuation if they are financially able to do so, to build their retirement nest egg.

“We also recommend that employees check to ensure they are receiving the minimum SG contribution, from their employers, which is currently 9.5 percent,” Mr Conway said.

www.publicaccountants.org.au

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THE Australian Small Business and Family Enterprise Ombudsman, Kate Carnell has written to Prime Minister Scott Morrison, requesting support for Australia’s small business sector, including the nation’s 1.4 million sole traders.

“The COVID-19 driven downturn is already taking an unprecedented toll on the Australian small business community,” Ms Carnell said..

“Sole traders, which account for more than 60 percent of Australian businesses, are currently ineligible for cash flow assistance of up to $25,000 because it is only available to businesses that directly employ staff. 

“Our view is that government support should be extended to small businesses, including sole traders who are facing dire circumstances amid this COVID-19 health crisis.”

The Ombudsman has suggested a suite of measures that could be implemented by the Federal Government that could help sole traders, independent contractors and small businesses – particularly those operating in tourism, events, training, catering and hospitality industries – in the short term.

“Sole traders and independent contractors need income support right now without the administrative burden of asset testing,” Ms Carnell said.

“New Zealand’s recently announced wage subsidy scheme providing eligible businesses, including sole traders and self-employed people with $585 per week (employers can receive a maximum of $150,000), for each full-time employee for a period of 12 weeks, is a model the government should consider.

“We also believe New Zealand’s COVID-19 leave and self-isolation support package providing all small business employees, including sole traders, who are unable to work or are caring for others with weekly payments of up to $585 for a period of up to eight weeks is worthy of government consideration," she said.

“Sole traders should be eligible for immediate rebates of PAYG quarterly instalment payments paid during the 2019/2020 financial year and PAYG payments on income drawn from the business.

“Cash flow is absolutely vital for all small businesses, including sole traders, who should be given one-off access to their superannuation at this critical time," Ms Carnell said.

“Low interest loans should also be extended to those small businesses and sole traders impacted by a loss of trade due to COVID-19, similar to what has been offered to bushfire affected small businesses.

“Finally, a national small business recovery program, including fast-tracked regional infrastructure projects and mandated small business supplier quotas in all government procurement is required for the nation to get back to business.”

www.asbfeo.gov.au

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SODEXO Australia has taken home two major awards in the facility management industry’s FM Industry Awards for Excellence: the Occupant Safety and Wellbeing award and the People and Productivity top honour.

The annual FM Industry Awards for Excellence present Australia’s highest accolades for facilities management in order to highlight an industry which works to ensure the safety, security and sustainability of the built environment. 

Sodexo FM Platform Australia director, Paul Amato said the awards were recognition of the company’s commitment to reshaping modern facilities management practices “and support of greater efficiencies and better service to workers and staff onsite”.

 “We’re proud of this achievement and hope to continue to set benchmarks for facilities management excellence through our quality of life services,” Mr Amato said. “It’s a true credit to Sodexo’s employees and leadership to be formally recognised in this year’s FM Industry Awards for Excellence.

“The awards are a testament to the company’s leadership, innovation and service in Australia’s FM sector.”

Sodexo was presented with the Occupant Safety and Wellbeing award for its specialised Heating, Ventilation, and Air Conditioning (HVAC) Improvement Program which provided solutions to the aging assets being used by residents in six villages across Western Australia.

The HVAC Improvement Program identified the issues relating to the aging assets regarding air quality and presented a cost-efficient solution. Since the ductwork was cleaned and coated, residents noticed a change in the environment, including the air being fresher and easier to breathe.

Sodexo won the People and Productivity award for its initiative to achieve greater efficiencies in communication between Sodexo’s offices and their clients' facilities.

Sodexo’s technical services team implemented technology solutions using an internet-of-things (IoT) framework to enable them to remotely capture asset condition, performance and data across multiple communication platforms.

Sodexo also sponsored the Industry Innovation award and congratulated Blue IoT on winning that category.

Sodexo in Australia employs a diverse workforce of more than 5000 employees delivering a unique array of over 100 integrated services lines including catering, facilities management, concierge services, security, asset maintenance and hospitality services in segments as diverse as corporate, healthcare, seniors, government and resources.

https://au.sodexo.com/.

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