The federal government has announced plans for an inquiry into impediments to business investment, in a bid to boost economic growth from the private sector.
In a statement, Treasurer Scott Morrison announced the request had been put to the House of Representatives standing committee on economics.
“Business investment is critical to economic growth. When firms are empowered to invest in new productive capacity and technology, it supports innovation and helps create new opportunities and employment for Australians,” Mr Morrison said in support of his push.
“Business has told us that regulations are one major impediment to investment, especially in terms of the volume of regulation and compliance costs. Businesses find it particularly difficult when they are required to interact with multiple levels of government.”
As part of the inquiry, Mr Morrison is hoping to explore the cumulative regulatory burden businesses face across the different levels of government, the effectiveness of innovation policies, how taxation impacts business investment as well as the impact that payment terms have on SMEs in particular.
It comes just weeks after alternative business finance provider Scottish Pacific revealed more than nine in 10 SMEs have suffered revenue cuts directly because of cash flow problems.
This is despite business advisory firm HLB Mann Judd finding that accessing funds is not a problem for most businesses, indicating payment terms are a primary contributor to business growth prospects.
While the federal government last year unveiled a plans to standardise 15-day payment terms for all of its own entities trading with SMEs, state governments as well as multinational conglomerates have been identified as the major culprits for poor payment practices towards small and medium businesses.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.