The Productivity Commission has found small businesses feel the burden of regulation more strongly than other businesses. Consistent with the ABN’s submission to the enquiry, the draft report into “Regulator Engagement with Small Business” found that the sector’s lack of staff, time and resources present challenges in understanding and fulfilling compliance obligations. Interestingly, the Commission places a lot of emphasis in the report on the need for better regulator culture, noting culture is crucial to effective engagement.
“A regulator’s culture and attitude towards business is as important as the content of the regulation itself, but fewer than one in five regulators are informed about the costs they create for businesses,” Commissioner Dr Warren Mundy said.
The Productivity Commission goes further to argue that the capacity of small businesses to fulfil compliance tasks should be at the forefront of a regulator’s mind when administering regulation.
What a revolutionary concept! While the Commission contends regulators are generally committed to effective engagement and to minimising unnecessary burdens, many do not have the frameworks that convert high-level ideals to good practices on the ground. The Commission found that the regulators rated highly by industry could demonstrate extensive and continuous staff training, effective communication and stakeholder engagement strategies and had a culture that rewards consistent good behaviour. To make these cultural shifts and allow regulators to do their job effectively, the draft report also recommends that regulators be resourced appropriately by Government, thereby avoiding the shifting of costs on to small business. The Productivity Commission is seeking comment on its draft report to develop a final report to Government by the end of September. Workshops will be held in July/August to canvass the views of interested small businesses.
