Business funding not enough

29 Nov, 2011 02:00 AM
p. Peter Harvey (centre) and the team at Middle East Engineering. Mr Harvey described the Government's resilience package as a
p. Peter Harvey (centre) and the team at Middle East Engineering. Mr Harvey described the Government's resilience package as a "token amount."

THE State Government's new $350,000 resilience support package for rural and regional businesses has been described as a "token amount" by small business owners.

Small Business Minister Simon O'Brien said the scheme was designed to help rural and regional communities move from a crisis management approach to one of risk management, and be better prepared for future challenges.

"This drought reform package follows on from the very successful Small Business Dry Seasons Assistance program of 2010-11, which saw more than $500,000 allocated to more than 330 business owners across 100 drought affected shires," he said.

"Although many of the affected shires have since received rain, the dry season impact on local businesses is yet to be alleviated.

"Often, small businesses are as vulnerable to climatic conditions as their farmer and primary producer customers, so it's important for them to have sound business practices to withstand fluctuations in their trade."

The grant provides a subsidy of up to $1500 to help eligible small businesses cover the costs of a professional service provider, such as an accountant, financial planner, legal practitioner or management consultant.

The idea behind the scheme is that these contracted services will identify areas of the business that can be improved and develop strategies to increase the resilience of the business and its capacity to withstand the impact of future dry seasons.

But Peter Harvey from Middle East Engineering, Kondinin said the funding was not enough.

"Professional advice is a help but it's not really doing anything, for most businesses tax breaks would be a better idea because they have a direct affect that the business can actually feel," he said.

"If you're prepared to work in regional areas and take the pressure of metropolitan places you should be eligible for tax breaks or incentives.

"The only real way to make small country businesses more resilient is to increase their reach and their selling area, so any help in that aspect such as marketing assistance would be money better spent. Most rural businesses already know how to operate when put under the pump and have strategies in place to cope with tough times because their rural businesses and country towns have been shrinking for a long time."

Malcolm Longbottom, Longy's General Welding, Grass Patch agreed that most small businesses already had their own accountants and advisers.

"The main thing in really small areas is that in a drought year business is really slow, even at community functions things are tough," he said.

"While the money is better than nothing, it's still not much and I don't think we have ever been able to qualify for it anyway.

"For businesses that are going down the gurgler it's already too late.

"The Government really needs to check into the scheme better and really look at where the drought assistance is able to go and ensure the right people are able to receive it."



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