Budget 2022: Is there room for small businesses in Jim Chalmers’ vision for a “better future”?

When Treasurer Jim Chalmers hands down the Albanese government’s first budget tonight, he will mention the words “small business” only once.

The oft-quoted line from the Coalition era — that small business is the “engine room of the economy” — is notably absent from both the Treasurer’s speech, although it did make it into a short media statement from Small Business Minister Julie Collins.

Instead, Chalmers will speak of creating a “resilient” economy, with “responsible budget management” in a “solid and sensible budget”.

It’s not to say the budget is without measures that will benefit small business owners — or that the overarching theme of containing inflation and prioritising wellbeing doesn’t apply to business operators — but the little time spent talking about the sector says something important about where the small business community sits on the ladder of priorities for the Labor government.

This year’s budget contains increased funding for small business mental health support, and changes to paid parental leave and childcare, all of which we knew about before heading into the budget lockup on Tuesday afternoon.

It also features:

• Tax cuts for electric vehicle owners;
• A plan to create half a million fee-free TAFE places and new incentives for apprentices;
• New grants to encourage small business owners to invest in more energy-efficient assets;
• An ambitious ‘Housing Accord’ that will seek to build 1 million new homes over five years;
• Millions of dollars of increased funding for the Australian Taxation Office’s compliance programs; and
• More funding to crack down on online scams.

Taken together, these measures will no doubt help many small businesses that are still recovering from the effects of the COVID-19 pandemic, that are wanting to invest in electric vehicles and improve their energy efficiency, and that are left short-changed by the uneven playing field created by the shadow economy.

But the gaps for small business are glaring.

Leading into the budget, Australian business groups were all on a unity ticket calling for the previous government’s Temporary Full Expensing measure to be retained and made permanent, echoing calls that have long been made regarding instant asset write-off policies in general.

The measure is nowhere to be found in tonight’s budget.

Also absent is funding to help small businesses tackle the very real cybersecurity threats they encounter on a daily basis — a top item on the budget wish list from the Council of Small Business Organisations Australia — and vouchers or financial assistance for small businesses to access professional advice, again a long-called for policy from the SME community.

Once again, improvements to the Research & Development Tax Incentive are absent from the federal budget papers, and as SmartCompany’s senior tech journalist Tegan Jones reports, members of the tech and startup communities may rightly feel that they have also missed out this year.

The lack of new spending in this year’s budget is not unexpected; the government has been preparing the groundwork for weeks by telling Australians not to expect “firecrackers and razz-a-matazz”, to borrow the words of Assistant Treasurer Stephen Jones.

And despite an improvement to the budget deficit of $41.1 billion — it is now forecast to come in at $36.9 billion for 2022-23 — Chalmers has warned the “revenue boosts” that have led to this improvement will be short-lived. The global economy is ‘teetering on the edge’, he says, and the environment is “uncertain”.

It’s important to note too, as CPA Australia’s Gavan Ord did in SmartCompany earlier this week, that we are only seven months away from the next federal budget next year, so in some respects, tonight’s budget is a curtain raiser for what’s to come.

But in all the talk of resilience, of working toward a “better future”, the plight of the millions of Australian small businesses is being overlooked.

This is a sector, as Small Business Minister Julie Collins notes, that contributes more than $430 billion to the Australian economy each year, and is therefore absolutely vital to surviving the challenges of the current economic environment.

And to the future that Chalmers so boldly envisages.