The New South Wales budget has precious little for small business, but business have welcomed plans for a Small Business Commissioner, greater infrastructure spending and a commitment to returning the state to surplus.
The budget, the first for Premier Barry O’Farrell and Treasurer Mike Baird, had been promoted as a tough one, with $8 billion in savings promised over four years and $800 million in spending cuts announced.
It might live up to its promise for small business: the Liberal and Nationals Government has pledged just $5 million in the 2011-212 budget for the state’s 650,000 small businesses, including funding for the NSW Business Advisory Services, entrepreneurs, regional business and exporters.
Small Business Minister Katrina Hodgkinson says the Government was “determined to restore the state’s small business sector to the nation’s premier position.”
Council of Small Business of Australia executive director Peter Strong welcomes the news of a Small Business Commissioner and says the Government has done a difficult job well.
“I’ve heard negative comments from small business people, but the spending will get some action happening, which is good for confidence,” Strong says.
“The other thing to remember is it’s a nine-month budget, so they can review it quickly.”
“They’ve done what they needed to do after inheriting a mess.”
Strong also welcomed the focus on infrastructure, saying it would boost confidence and deliver jobs. Infrastructure spending was increased by 12.5% over four years to $62.6 billion.
And despite complaints from first home buyers about a tightening in stamp duty concessions, Strong says the restriction to new homes only would stimulate jobs for SMEs.
While the state will fall into deficit this year on the back of reduced GST payments and stamp duty payments, the Government has promised a small return to surplus in 2012-13. It also promises annual growth in recurrent spending of less than 4% in the three years of the forward estimates.
Baird has also increased mining royalties, lifted fees for public preschools, announced the closure of three jails, and capped public sector pay rises to 2.5%. There are also some 5,000 voluntary public-sector redundancies on offer.
The NSW Business Chamber has praised the budget as a strong one that “tackles unnecessary expenses growth, cuts bureaucracy and invests heavily in much-needed infrastructure,” while Standard & Poor’s have raised questions about whether it will be able to achieve the billions in savings.
Australian Industry Group NSW director Mark Goodsell also welcomed the investments in transport and regional infrastructure.