According to accounting body, CPA Australia the Federal Government can avoid a “hard landing” by developing a post-lockdown business support strategy – one that involves a combination of Commonwealth and, state or territory supports for small-to-medium enterprises (SMEs).
“New national arrangements on Covid-19 business supports are a positive development [but] the missing piece is what happens once a lockdown ends,” says CPA Australia CEO Andrew Hunter.
“The impact on businesses doesn’t stop the moment a government calls time on a lockdown. If support is withdrawn immediately, many businesses may experience a damaging hard landing.
“By tapering business support for a couple of weeks post-lockdown, the government can soften the negative effects of withdrawing support.”
Mr Hunter says that the CPA has had many conversations with “governments, industry and members since the pandemic began” and has “heard countless stories of lockdown hardship from business owners”.
“Based on our experience, a coordinated national approach, including direct and indirect supports, makes a big difference to businesses’ success after an extended lockdown,” he says.
The CPA call for a five-element strategy delivered immediately post-lockdown:
- Tapered support for SMEs with eligibility based on decline in turnover.
- Deferral of Commonwealth and, state or territory SME revenue collection.
- A moratorium on Commonwealth and, state or territory compliance activity, such as ATO debt collection.
- Consumer incentives, such as dining, travel and accommodation vouchers.
- Financial assistance for businesses to seek professional advice.
“If the Government takes the initiative immediately, we could have a strategy in place for when current lockdowns end, and for any future lockdowns.
“We acknowledge that this will require a high level of coordination between different levels of government, but we don’t think that’s too much for Australians to expect,” says Mr Hunter.