Insolvencies are sky-high, but the NSW Small Business Commissioner fears policymakers aren’t taking note

Decade-high business insolvency figures may not speak for themselves, says NSW Small Business Commissioner Chris Lamont, who fears that ample data on SME hardships may go unconsidered by policymakers.

Speaking at the Council of Small Business Organisations Australia (COSBOA) annual summit on Wednesday, Lamont said better regulation is equally as important to small businesses’ performance as extra financial incentives.

The problem, Lamont said, is that reams of data outlining the struggles of small business may not easily translate to pro-small business policies.

“I would insist upon a better evidence base,” Lamont said.

The “highest level of insolvencies [since 2015] should influence policy decisions, but my fear is that’s just noise”, he added.

Construction businesses, many of them small businesses, are among the most represented among those worrying insolvency numbers.

But Lamont highlighted the restaurant sector to expand upon his point, saying mounting anecdotal evidence does not guarantee action either.

From 2025, Country of Origin Labelling (CoOL) rules will compel food vendors to accurately list the origin of their seafood – a move that some small businesses say will come with considerable compliance burdens, including the cost of printing new menus and tracking produce that comes from different corners of the country depending on the day.

Lamont said the NSW Small Business Commissioner is advocating for small businesses concerned about the nationwide regulation, but he remains concerned about the shape of the CoOL rules.

“I worry the voice of small business is frequently overlooked, or worse, ignored,” Lamont said. 

The cumulative effect of misreading or overlooking data, and sidestepping the anecdotal views of small businesses subject to new regulations, could deter younger entrepreneurs from replacing an ageing small business community, he added.

“I fear that too many of our brightest future entrepreneurs have elected not to found their own business,” Lamont said, reflecting on the comparative risk and regulation-free option of entering traditional employment.

“The reality is they’re not going to be around, and there won’t be the people to replace them unless we make it easier,” he added.

Despite his office receiving record levels of interest through 2024, Lamont encouraged NSW businesses facing disputes with their landlords, suppliers, or customers to step forward for low-cost mediation options.