Here’s what Labor and the Liberals have promised small business ahead of the Victorian election
Labor has built its re-election campaign around cheaper and more renewable power, while the Liberals have targeted taxes.
The Labor government of Premier Daniel Andrews instituted some of the world’s harshest lockdowns in response to the coronavirus pandemic, and many small businesses which closed their doors simply never reopened.
However, the party also rolled out unprecedented financial support for many small businesses in 2020, and successfully lobbied the federal government to go halves on support for locked-down ventures in 2021.
In 2022, the government now faces a new set of economic challenges which can’t be met with subsidies and grants alone. Here’s what the Labor government has promised for the business sector if re-elected.
Labor
Lower power bills through State Electricity Commission
The rising cost of power has emerged as a crucial issue for small businesses through 2022, cutting into margins as SMEs scramble to obtain ingredients and materials, retain staff, and win over customers facing their own cost-of-living crisis.
Beyond the $250-a-household cheques targeted at those seeking a cheaper power provider, Labor’s proposal to lower prices hinges on the reinstatement of the State Electricity Commission (SEC).
At least $20 million will go towards revitalising the publicly-owned SEC, with the long-term goal of making electricity generation 100% renewable.
Under the organisation, $1 billion will go towards projects generating 4.5 gigawatts of renewable power, the government claims.
Compared to recent price shocks to the gas market caused by conflict in Ukraine, Labor argues that taking ownership of renewable generation sources will ultimately reduce the state’s dependence on increasingly costly fossil fuel generation.
Some $6 million will go towards a training centre for workers in the onshore and offshore wind generation industry.
All told, Labor says the developments will eventually create 59,000 jobs in green energy generation, and at least 6,000 apprenticeships and traineeships.
Apprentice registration subsidies
With the cost of living a particular burden for workers early in their careers, the Andrews government says it will cover the cost of car registration for apprentices.
The measure is slated to save eligible apprentices upwards of $850 a year, the government claims.
Given the dearth of qualified tradespeople across the state, the government hopes the measure will encourage young Victorians to pick up a trade — and potentially give small businesses access to new talent.
Fee-free TAFE
A focus on skills doesn’t end with apprentices, as the Labor government says it will expand its access to fee-free TAFE.
Courses covering “in-demand jobs” across healthcare, mental health, construction, early childhood care and hospitality will add to the list of current fee-free courses.
At the same time, limits on who can access those courses will be lifted: those with existing higher-education qualifications will be able to access those courses, too.
Students and trainees will also be free to take on more than one fee-free course.
The measures come as businesses cry out for qualified talent, and turn to alternative training solutions to meet their workforce needs.
First Nations business strategy
The Andrews government in July revealed a $25 million plan it says will support the prosperity of Aboriginal Victorians and the business communities they create.
Called Yuma Yirramboi — “Invest in Tomorrow” in Woiwurrung — the plan focuses on culture, people, accountability, jobs, wealth creation, and business.
On the latter point, the plan will “increase support for Aboriginal entrepreneurs and businesses, including improved access to capital, information and expertise”.
The state will also investigate ties to First Nations-owned businesses as part of the Victorian Social Procurement Framework, and forge partnerships between those businesses and research institutions.
In a statement accompanying the plan, the Koori Caucus said it “honours our right to participate in Victoria’s economy as employees and employers, consumers and suppliers, investors and investees, creators and contributors.”
Liberals
The Liberal Party and its leader, Matthew Guy, have a simple message for the small business community: they aren’t the ones that shuttered Victoria’s shops, restaurants, hotels, and hairdressers for months as COVID-19 swept the state in 2020 and 2021.
Granted, the Liberal Party isn’t the party that doled out billions in handouts and subsidies to keep those businesses afloat, either. But the state opposition hopes lingering antipathy towards those lockdown measures is strong enough to bolster its support among small business voters.
Beyond simply not being the Labor Party of Daniel Andrews, the Liberal Party has small business policy promises of its own.
Payroll tax cut
If elected, the party has pledged to slash payroll tax for as many as 28,000 small businesses.
As it stands, state payroll tax applies to businesses that pay more than $700,000 in wages a year. The Liberal Party wants to lift this to $1.6 million a year, a move it says will eliminate payroll tax for more than 13,000 small businesses.
A stepped approach to payroll tax for firms with wages of between $1.6 million and $2 million will see those firms slash up to $43,750 from their annual tax bills, the party claims.
“Payroll tax is a tax on jobs and by slashing these rates we will support small businesses to grow and hire more staff,” Shadow Minister for Jobs and Small Business, David Southwick, said in a statement.
The policy is slated to put a $435 million dent in the state’s bottom line over four years, with the Liberals declaring that shortfall will be met by debt reduction activities elsewhere in its budget measures.
No new taxes
Beyond the commitment to slash payroll tax, the party has promised not to institute any new taxes if elected.
Pause on government fees
The Liberal Party says it will enact a four-year freeze on local government fees payable by small businesses.
This includes “footpath and road occupation fees, fees on hairdressers and beauty businesses, fees on food businesses, and fees on accommodation providers”, the party states.
COVID-19 public health measures saw more local businesses, restaurants and cafes offer footpath dining, but those outdoor expansions come at a cost: in the plush Bayside council region, restaurants can pay between $376 and $1120 per outdoor table.
Under a Guy government, local jurisdictions would also be barred from instituting new fees without the express sign-off of the Minister for Small Business.
Tradie registration fees scrapped
A May tweak to the Victorian Building Authority fee structure will be reversed under a Guy government, the party has declared, a move it claims will save tradespeople some $63 million over four years.
The Andrews government said a suite of fee increases for those in the building and construction sector would help support the state regulator, while also reducing up-front costs for new market entrants.
But the Liberal Party has painted the fee tweaks as a handbrake for the sector, and a potential culprit for rising new home prices.
$2.5 billion for manufacturing
If elected, the party has promised $2.5 billion in local manufacturing investment, including $1 billion specifically for regional Victoria.
Under the plan, the Liberal Party would back $400 million in co-funded grants for local manufacturing innovators.
Funding for EV chargers
The Andrews government has already funded $5 million in grants for EV charging sites across small businesses, shopping strips, and tourism hotspots.
In turn, a Guy government would launch a $50 million Community Charging Fund “to leverage co-investment with businesses and community organisations” and help create 600 new charging sites across the state.
