Nearly 70 per cent of all businesses in Australia are family-owned, whether that’s the local newsagency run by a husband and wife team, through to the mid-sized, father and son construction company. Ideally, this week’s federal budget will also cater for family-owned small businesses.
It’s no secret they have a significant impact on our economy. More than 2.1 million small businesses employ over 4.8 million Australians (nearly 50 per cent of private sector industry employment), and contribute 34 per cent of gross domestic product.
MYOB's Business Monitor survey, which includes more than 960 small businesses, revealed the top initiatives that would turn small business election votes towards the proposing party. These include reducing paperwork burden, returning the budget to surplus faster, investing further in infrastructure, free government-funded training, and increasing innovation and R&D funding. Let’s look at these points a little more.
Introduce policies that significantly simplify the GST/BAS reporting process.
Independent small business owners and managers continue to call for tax reform, deregulation and the reduction of red tape (67 per cent). The tax office found a commensurate increase in the number of compliance discrepancies from 266,000 in 2007-08 to over 540,000 in 2011-12. The significant level of paperwork and compliance required by the government is a common pain point, hence Victoria recently appointing its own red tape commissioner. Perhaps this should be expanded to a national posting. More work must be done to help SMEs simplify their regulatory commitments.
Further cut government expenditure to return to surplus faster and address structural deficit.
While businesses would welcome a targeted approach to stimulating productivity and growth in the 2013 budget, they are also calling for the government to renew its commitment to balancing the books. Forty four per cent of small businesses would support even further cuts to government expenditure. This would help reduce their feeling of economic uncertainty and boost confidence in the economy.
Increased federal government investment in transport infrastructure in our major states and cities.
With fuel prices continuing to reach record highs and expected to remain so over the short term, fuel prices are noted as small businesses top pressure point. It’s no wonder 64 per cent said they would vote for the party that proposed more investment in city transport infrastructure. The pressure is felt by many small businesses, but most of all by those in transport, postal and warehousing. The research found 45 per cent of respondents in this sector experienced a drop in revenue in the first half of this financial year.
Provide free government-funded training on how to use the internet for all small businesses.
Over half of small businesses would welcome free government-funded training on how to use the internet to help them enhance and grow their business. Our research found that small businesses with a business website were 60 per cent more likely to experience a revenue rise. The benefits of small businesses participating in the digital economy include the ability to compete on a more level playing field with local and global rivals, increased productivity and less time spent on administration. This means more time for growing the business.
Increased government funding for innovation, research and development by Australian businesses.
I hope to see the government devote more funding to innovation and the development of the workforce – both of which have the potential to transform the economy. Fifty six per cent of small business operators would welcome an increase in government funding for innovation, research and development. In this budget, government has the potential to make a real difference to the growth and development of family-owned small businesses by focusing on the areas that underpin increased productivity. This has the potential to make a difference to our economy.
Australian business owners and managers are known for digging deep, embracing change and adapting. However in periods of uncertainty, being in business is even tougher. I call on the federal government to strengthen their support for family-owned businesses, no matter their size or shape. There’s plenty of opportunity for policy consideration in this year’s budget and in the run up to this year’s election.
Tim Reed is the chief executive officer of MYOB.