A big sigh of relief could be heard across the nation as the Prime Minister, Kevin Rudd, finally called the federal election over the weekend. Now we have a date, 7 September, we can stop the speculation, focus on policies and hopefully see an end to the uncertainty that has been plaguing business growth. Of course, the biggest news in the lead up to the weekend was the Government’s economic statement which revised the budget deficit upwards to $30bn (forecast), predicts slower economic growth and an unemployment rate over 6% within a year.
This is obviously bad news for small business, with already low consumer confidence set to take another hit.
But small business appears to finally be getting some attention from both major parties. As usual, the lead up to the federal election announcement was characterised by a frenetic pace of policy announcements and public appearances by both sides of politics – clearing the decks maybe? On the Government side, last week they announced that:
- Small business e-resources have been updated,
- They had released their response to the review of the Franchise Code of Conduct,
- They were cutting red tape for cafes and restaurants, and
- Small business is to gain access to the Superannuation Complaints Tribunal.
Interestingly they also released a discussion paper on a Prompt Payment Protocol to help gather input from business about the best way to target business-to-business late payments that cause cash flow problems. We’ll explore this in more detail and probably come back to you for feedback. The Leader of the Opposition, Tony Abbott, wasn’t going to be left behind with the media reporting he will announce a Coalition government that would cut company tax by 1.5¢ within two years, taking the current 30¢ in the dollar rate down to 28.5¢. Mr Abbott will apparently argue the 1.5¢ cut, which is lower than the 5¢ recently called for by the Business Council of Australia, will underpin investment and energise the non-resources sector.
Mr Abbott also had a high profile appearance at the NSW Business Chamber’s Australian Business Congress where he promised if the Coalition won the federal election, it would be a government for small business.
Among his statements at the Congress were;
- A Coalition government would have a dedicated small business minister sitting in cabinet.
- The Coalition planned to involve the sector in economic decision making by including a dedicated small business representative among Australian delegates on the Business 20 (B20) group (due to be held in Brisbane in 2014).
- A coalition government would cut down on excessive red tape, making it easier for small businesses to submit superannuation contributions and administer paid parental leave, and
- He also pledged to restore the Australian Building and Construction Commission, and to work within the existing Fair Work Act to “restore the work places pendulum back to the sensible centre”.
Regardless of who wins the federal election, there are no quick fixes to the economic downturn.
And with worsening economic conditions predicted, it is critical to be on top of our business’ financial position at all times. If you haven’t done so already, now is a good time to consider doing our Small Business Finance Course. It will give you the skills to understand your financial position and proactively manage your finances.