The government has announced a new $10,000 grant and simplified access to existing loans and other services for small businesses impacted by recent bushfires.
In a joint media statement on Wednesday, the federal and state governments announced a new Bushfire Affected Small Business Rebuild package to ensure small businesses devastated by the recent bushfires receive immediate support tailored to their individual circumstances.
Joining the press release, the Minister for Emergency Management, David Littleproud, said that besides a new grant, the government is cutting red tape to ease access to existing services offered to bushfire-affected small businesses.
“We are listening and acting to help fire-affected communities while supporting states to roll out recovery programs quicker than they have been,” Mr Littleproud said.
What’s the government doing?
The government is offering a $10,000 grant to eligible small businesses in selected local government areas (LGAs) that have experienced a 40 per cent drop in revenue over a three-month period, compared to the previous year, as a result of the bushfires.
The funds are tailored to assist with the costs of maintaining the business, including — but not limited to — accessing financial advice [as well as] covering salaries, wages, utilities and fuel.
Moreover, the government confirmed that as part of its new package, it has also relaxed and simplified existing eligibility requirements for concessional loans up to $500,000. This includes lowering the threshold for documentation when applying for a loan.
Additionally, it has removed the requirement for security to be provided for loans up to $50,000, and has deployed an additional 21 business experts to recovery hubs to ensure small businesses have access to tailored advice.
“We are embedding more staff from the agency in recovery hubs to provide help to people to access grants, loans and other services — they can assist small-business owners to navigate systems, fill in forms and get the support they need,” Mr Littleproud said.
The updated package is being funded by the Commonwealth government under the Disaster Recovery Funding Arrangements.
The state’s peak business organisation, Business NSW, has applauded the government’s latest move.
“The government is listening to the ongoing concerns of small-business owners in bushfire-hit regions,” said Business NSW CEO Stephen Cartwright.
“Everyone understands that there is not a bottomless pit of taxpayer money, but it became clear that the initial package of grants and loans was too prescriptive and too restrictive concerning who was actually eligible to apply for them,” Mr Cartwright said.
He opined that the new grant will “definitely help” with cash flow and general expenses.
“The strong feedback from bushfire-hit communities is that there was a strong duplication in a number of the documents required to be completed in order to access various forms of assistance, so a cut in this type of red tape will be well received.”
While the government remains silent on the body’s calls for the introduction of vouchers for small-business owners to use when accessing advice from their local accountants, Mr Cartwright applauded the latest effort aimed to grow the face-to-face support for affected communities.
“The government has stopped short of introducing vouchers at the moment, but bringing more business advisers in to help impacted business owners will certainly speed up the recovery process and the ability of a business to re-open its doors,” Mr Cartwright said.
Government fights back
Just last week, the government was at the receiving end of criticism over its handling of bushfire relief.
The criticism followed revelations 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 reported delays, Prime Minister Scott Morrison confirmed last Wednesday that the government is working on “repackaging” the funding program to fix the problems for small businesses.
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.
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.
- Australian manufacturers can create their own stimulus
- Here’s what separates success from the rest
By Adam Zuchetti
- 5 workplace trends to watch in 2020
By Nicole Gorton