The Nationals leader and Member for Murray Plains, Peter Walsh, said the real story behind the Andrews Labor Government’s $460 million funding to try and repair the damage it has caused with its fourth lockdown since the pandemic started must be told.
Mr Walsh said just like its overhyped business support fund (BSF); the latest funding will fail too many businesses because the requirements are “incredibly narrow” and will do the most damage to the very people they are meant to support – small business.
He said accountants across regional Victoria are now under siege as desperate businesses try to find their way through the red tape.
“In Swan Hill, Logan and Hall director Gary Tomamichel said ‘rules are being made on the run’ and there have already been two updates on initial announcements to add to the confusion,” Mr Walsh said.
“Gary tells us there are already a number of issues; but the biggest blow is for genuine small business people, sole traders earning less than $75,000 without GST registration, the very people who have lost the most, get nothing,” he said.
“Worse, the Victorian Ombudsman has told us there is no appeal for them; because these decisions are covered by the Andrews Labor Government’s emergency powers the Ombudsman does not have any rights to intervene.”
Mr Tomamichel said their first client through the door after the funding was released was a sorry one; they were under that $75,000 cap.
But added while he understood the challenges of an evolving situation; “that’s not much comfort for those in their hour of need to have so much uncertainty”.
“Because sole traders (no employees) with no GST registration due to a turnover under $75,000 are not eligible that will take so many small businesses out of the equation,” Mr Tomamichel said.
“In one case we have, a massage therapist in a small country town who has been locked down, with no income for a week, has been devastated because there was no real need to GST register due to turnover and the nature of the services,” he said.
“We have also copped quite a bit of flak from a very disgruntled Victorian as we have to be the bearer of the bad news.
“Many small businesses choose not to GST register as this can put them at a competitive advantage – except when the doors are locked and there’s no income.
“A mobile hairdresser is an example; and a small catering business which lost functions, are all in the same not-eligible group. These Victorians are the most vulnerable as a week with no income is like being stood down.”
Mr Tomamichel also argued the timeframe of three weeks to apply is too restrictive if the Government is going to keep changing the rules on a regular basis.
He said the restrictive question of fixing industry codes that don’t meet the restrictive criteria; or get denied on a technicality; has yet to be looked at.
“Another client has been knocked back as she misinterpreted the questions surrounding payroll; as it is somewhat unclear,” Mr Tomamichel added.
“The question also has been raised as to the impact on businesses that are not within the ANZIC industry codes,” he said.
“For example; a business that may be considered essential and remains open; but its clients keep away due to the lockdown, such as a garage or service station which remains open, but only deals with very few customers as most are locked up at home and dare not go out, is financially hamstrung.
“It may have been more pertinent to ask the question: has your business been impacted by the lockdown? And if so; explain why and to what extent you need to demonstrate need rather than just throw a dart at the ANZIC industry code list and pick a selection, as this always leaves some or many to fall through the cracks.
“From our perspective we are going to have many more clients that are impacted in one way or another that will miss out due to the criteria than will qualify. The proof in that will be what or how many make the cut and get approved.
“If my memory serves me correctly on the Department of Jobs, Precincts and Regions and the business support funds first round of grants, there were 93,000 applications mentioned but Premier Daniel Andrews went on to say they had approved 50,000.
“If these numbers are correct; then yes, the same could apply here. When we see the rejection rate that will confirm if they have got the criteria right or not.
“More than anything; we would love to have the DJPR and the Minister deal with the anguish and pain these Victorians have gone through.
“I guess not one was sent home without pay for a week as has happened to small business owners, regardless if whether they were GST registered or not.”