Bushfire assistance is set for an overhaul aimed at speeding up payments to small businesses, after it was revealed that hundreds are still waiting to hear back from the government after submitting grant applications nearly two months ago.
During the Senate estimates hearing on Tuesday, it was revealed that while 738 small businesses have applied for a grant to help bushfire recovery, only 147 have been processed to date for a total of $2.9 million.
Additionally, only five of the 104 applications received for concessional loans have so far been approved.
Responding to the delays, Prime Minister Scott Morrison confirmed on Wednesday that the government is “repackaging” the funding program to fix the problems for small businesses, following reports that considerable delays are threatening the livelihoods of many.
The Morrison government announced a comprehensive suite of measures to “immediately” support impacted small businesses on 20 January. At the time, $2 billion was pledged to help with the bushfire recovery, while loans of up to $500,000 were offered for businesses that have suffered significant asset loss or a significant loss of revenue.
In addition, the government said it will be issuing grants of up to $50,000 to eligible small businesses and non-profit organisations, tax-free.
While the Prime Minister conceded earlier this week that the process needed to be faster, Andrew Colvin, head of the government’s newly created National Bushfire Recovery Agency, shifted the blame to state governments.
Questioned at the hearing, particularly in regard to concessional loans, Mr Colvin said: “We’re working through a process with the states, who administer those, and that money is being made available as those applications are processed.
“We are certainly encouraging the states to make sure they’re able to process them as quickly as possible, but we are not responsible for the processing of those applications.
“In all of these areas, we are working and we are endeavouring to work with the states. We are putting forward, obviously through the recovery agency and other parts of government, as much assistance as we possibly can, but we don’t actually process those applications.”
Stepping in to defend Mr Colvin, Senator Seselja said: “We are working as well as we can.
“In terms of the actual decision-making process, it is a matter for states rather than for the Commonwealth.”
Recovery process could stretch to 10 years
Mr Colvin maintained that the process in a “recovery is a marathon, not a sprint”.
He told the hearing that $205 million has so far been spent from the $2 billion bushfire recovery fund, with significant costs expected to occur before the end of the financial year.
Asked about the length of the recovery process, Mr Colvin opined that while the agency was given a sunset of 31 December next year, the process is likely to last for up to or over 10 years.
“Of course, it is subject to government to make decisions on what happens beyond that. However, my and the agency’s lens is far more than two years, so we’ll be looking at measures that are about the long-term recovery, which could be five, 10 or more years.”
Asked whether the $2 billion will be disbursed in the next two years and further funds allocated for the following years, Mr Colvin conceded that that’s a decision for the government.
He said: “I’m not in a frame that I would go back to him just yet and ask for more or say that we’re not going to spend it. We’re still making those assessments, and that’ll be a decision for government.”
According to the recovery agency, the fires claimed over 3,000 homes and over 12.6 million hectares of land.
Maja Garaca Djurdjevic is the editor of My Business.
Maja has an extensive career as a journalist across finance, business and market intelligence. Prior to joining Momentum Media, Maja spent several years unravelling social, political and economic intricacies in Eastern Europe.
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