Cutting Red Tape leads G20SME conference recommendations

| July 16, 2014

Reducing the costs of red tape leads the list of recommendations from the G20SME conference which will be raised at the B20 business leaders meeting in Sydney tomorrow (17 July 2014).

More than 120 people gathered at the G20 Agenda for Growth: Opportunities for SME Conference on 20 June 2014 at Parliament House in Melbourne organised by the Australian Treasury and First 5000 parent company Global Access Partners (GAP).

The recommendations from the event include reductions in red tape, smarter regulations across the whole of government, improved access to information and finance, fairer competition with larger companies, streamlined tendering procedures for government work and a new emphasis on entrepreneurship in Australian schools.

Addressing the issue of red tape, the report highlighted that proportionate compliance costs can be 10 to 30 times greater for SMEs than larger firms.

The importance of policies fostering SMEs and entrepreneurship to achieve the G20’s growth target was emphasized and the deligates welcomed the Australian Government’s policy reforms and new measures to help small business outlined in the keynote address by Minister Billson.

Key Recommendations for Change

• Tendering and insurance requirements for government business should be streamlined and reduced for SMEs. A voluntary target encouraging government departments and large businesses to purchase 20% of their goods and services from Australian SMEs should be established and promoted.

• SMEs and industry organisations should submit specific instances of existing red tape requiring reform to relevant members of a nation’s executive for immediate review. Smarter regulation and cross-departmental cooperation is required over the longer term.

• Governments should improve labour market flexibility, secure tax reform, harmonise regulation across domestic jurisdictions and continue the liberalisation of international trade. Improving productivity is the key to success.

• Entrepreneurship should be integrated into Australian school curricula and encouraged as a post-education employment option.

• The Australian Government’s Digital Economy agenda should include a single online entry point for the input of personal and business information and credentials.

• The 30-day limit for the settlement of government accounts should date from the issue of the initial invoice, with the burden of further requests falling on public officials, rather than the SME.

• SMEs must adopt new technology and embrace the digital economy to become globally competitive. A stronger focus on design and brand quality can also underpin long-term domestic and export success.

• Alternative sources of SME finance should be encouraged, with appropriate protection for stakeholders involved. Most SME expansion is financed by retained profits and so profitability should be encouraged to generate future growth.

• ‘Economic gardening’ of local small firms, through which SMEs are encouraged to take on an extra worker or two, can incrementally increase employment. Medium-sized companies with export scope have the greatest potential for extra output and employment, and policy should therefore encourage their expansion.

• The B20 should continue to focus on issues relevant to SMEs and international growth.
There are plans for a follow-up international SME conference to be hosted in Istanbul, Turkey in March 2015 as part of the Turkish G20 Presidency programme of activities.

Download the confernce communique
Download the full report