How government can support small businesses in 14 easy, non-controversial steps

The Australian Small Business and Family Enterprise Ombudsman (ASBFEO) has released a new report that once again highlights the need for Government attention to the small business sector. ASBFEO does wonderful advocacy work, and this report is no exception.

“Energising Enterprise,” highlights (again) the importance of creating a healthier environment for Australia’s small and family businesses. We all know the issues – from complex regulations to limited access to government contracts. But throwing stones from the sideline and endless complaining won’t fix the problem, so the report outlines 14 key steps that Governments need to take – now. Here, I touch on a few of these that resonate most with my experiences and observations.

Small Business isn’t a small Big Business

I have written before that a small business is not a scaled-down big business.  One of the ASBFEO’s recommendations is the need for right-sized and transparent regulation. This point is crucial. This resonates deeply with what I have observed in my work.

Many small businesses struggle under the weight of regulations that seem more suited to large corporations with dedicated legal teams. They have to juggle their daily operations with compliance requirements that are both numerous and complex. Consequently, business owners are too-often dealing with compliance issues late at night, after all their other work is done, and they should be spending time with family, friends and leisure. Wouldn’t it be better to have laws that are clearer and simpler?

The report gives a checklist for regulations. They should be:

• risk-informed,
• proportionate,
• relevant, and
• responsive to the ‘real life’ circumstances of small businesses.

Simplifying these, and having them be fit-for-size would not only help small businesses comply, but also free up time for owners to focus on the success of their business – and their families.

Making government procurement accessible

Another recommendation is better access to government contracts for small businesses. Of $75 billion spent by the Australian Government on procurement in 2022-23, small business suppliers only secured $8 billion. This discrepancy is not due to a lack of capability on the part of small businesses, but rather the daunting and often opaque nature of the government procurement process.

The ASBFEO describes how small businesses feel excluded from tender opportunities from Government as they are often not part of the ‘in-crowd’. The process is described as bewildering, complicated, and incongruent with private-sector practices. This echoes what I have heard time and again from small business owners who feel that the deck is stacked against them when it comes to winning government contracts.

To address this, the report suggests implementing specific, constructive, and practical recommendations to level the playing field. These include simplifying the bidding process and ensuring that small businesses have a fair chance to compete. By opening up government contracts to more small businesses, we can drive innovation, improve services, and stimulate economic growth. There are models in existence to do this, so it’s not impossible.

Digital engagement: The double-edged sword for business

The report highlights how digital engagement is becoming more important for small businesses. While digital tools make it easier to handle reporting and compliance, they also bring new risks. As businesses expand their online presence, they become more exposed to cyber-attacks and other digital threats. This threat conflicts with the need to have a strong online presence. Digital transformation occurs at lightning speed and can be overwhelming. Thus, there is a clear need for  coherent and coordinated support for SMEs needing to multiply their digital savvy so they can harness the benefits while mitigating the risks.

A path forward for business owners

The ASBFEO report is a blaring call for action. The Australian economy just doesn’t function without small and family businesses, yet they face significant barriers that hinder their growth and sustainability – barriers that don’t have to be there. The 14 steps outlined in the report, particularly around simplifying regulations, improving access to government contracts, and supporting digital uptake are a clear, non-controversial, and easily legislated path forward.

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