NSW election: What Labor and the Coalition have promised to small business

The NSW state election is now just days away, giving voters precious little time to assess the torrent of promises directed their way by both the incumbent Liberal-National Coalition government and their challengers in Labor.

Drawing from both Labor’s policy platform and the NSW government’s 2023-2026 small business strategy, SmartCompany has collated what both major parties have promised to the state’s small business constituents.

While not an exhaustive list of policies destined to touch the sector, here are the measures both the Coalition and Labor have presented to small businesses ahead of the March 25 poll.

The big picture

The Coalition’s small business platform serves an overarching goal: the operation of 1 million small businesses in NSW by 2030, up from around 840,000 in 2023.

Beyond specific measures intended to make life easier and cheaper for small business leaders, the Coalition states it will adopt a business-focused approach in all aspects of its operations.

Each government “cluster” will be required to produce a small business value statement — policy documents state — with departments tasked with publishing small business impact assessments for new policies, regulations, and major projects.

NSW Labor’s policy platform promises a “fresh start” after more than a decade of Coalition leadership,

Taxes

One of Labor’s biggest single policy proposals is to shake up payroll tax.

Under its plan, the NSW government would work with the Commonwealth to give small businesses the choice of lodging their payroll tax returns directly with the Australian Taxation Office, sidestepping annual payroll tax reconciliation.

That single-touch system, allowing businesses to lodge monthly payroll tax returns with the Australian Taxation Office as well as Revenue NSW, is projected to cut red tape for some 52,000 businesses, Labor says.

Tax policies at the Coalition start from a somewhat simpler pledge: no new taxes for small businesses under another Liberal-National government.

Its small business plan celebrates existing policies in the taxation space, including its reduction of the payroll tax rate to 4.85% for much of the COVID-19 pandemic, and raising the payroll tax threshold to $1.2 million in 2020.

Bill relief

With default market offers for energy only set to expand, the federal government has made energy price relief a priority in 2023.

It has pledged to co-fund $1.5 billion in energy bill relief for households and small businesses across Australia, joining contributions from the states and territories.

If elected, Labor says it will utilise that support to build a $485 million energy relief fund, providing $315 in energy bill support.

When matched with contributions from the Commonwealth, an estimated 320,000 small businesses will be eligible for $630 off.

By contrast, the Coalition’s new Energy Bill Saver program targets households, with rebates of $250 available to those who shop for a better power deal on the NSW government’s comparison site.

Government tenders

A NSW Labor government would significantly boost procurement from small businesses if elected, vowing to more than double the value of expenditure channeled to small businesses from 12% currently to 30% by the end of the decade.

To do that, the party has pledged to conduct apply “weightings” to local businesses vying for government contracts, boost the threshold for direct procurement from $150,000 to $250,000, and cut red tape related to qualification and insurance sign-offs.

If re-elected, the Coalition says it will tack another $2 billion onto the value of its small business procurements by the end of next term, bringing estimated government expenditure on SME goods and services to $10 billion over the period.

The Coalition also celebrated the early results of its payment times push this month, claiming it fulfilled almost 98% of invoices to small businesses within five days.

Red tape

Reflecting concerns over the wall of administrative tasks Australian business owners must climb before actually trading, both parties have revealed plans to reduce the burden of paperwork.

For Labor, that looks like the establishment of the NSW Business Bureau, an advisory body connecting SMEs to the government and its various business-facing functions.

The party claims the proposed entity would help small businesses navigate regulatory requirements and cut through red tape.

Joining Labor’s pledge to boost small business procurement, the body would also provide insights on tenders and grants, along with other government programs.

In addition, the NSW Business Bureau would assist the state’s small businesses to offer their goods and services abroad, Labor claims.

The Coalition also sees red tape as an enemy to be vanquished, pledging to establish a NSW Red Tape Commissioner.

NSW Productivity Commissioner Peter Achterstraat will likely be appointed “red tape tsar” under the plan and will be tasked with delivering $1 billion in savings through red tape reduction.

They will be equipped with a powerful weapon in this battle: a one-in, one-out policy across government, where ministers will need to find a rule or regulation to remove if they put forward a new proposal.

That hardline approach will last for two years if elected, the Coalition states.

Pre-election statements put forward by the Coalition do not outline the precise limitations of that regulation-cutting plan, or which areas may be deemed off-limits, like environmental regulations.

Government representation

Building on Labor’s procurement push, the party claims it will create a dedicated charter for small business, effectively enshrining how the NSW government deals with SMEs.

Key to that process is a pledge to “develop new processes and performance metrics” around the small business sector, which will help guide a Labor government’s decision-making in the sector.

A re-elected Coalition government would hold an annual skills summit, providing SMEs a direct audience with government representatives.

Boosting the state government’s digital capabilities is also on the Coalition’s agenda, through the establishment of a dedicated digital “hub” connecting SMEs to relevant information and government resources.

Green initiatives

While both parties champion green initiatives in their own ways, those proposals tend to be on the bigger side of the industry.

For Labor, it’s all about a $1 billion state-owned clean energy corporation and the end of further energy asset privatisation; for the Coalition, it’s all about $1.5 billion towards a clean energy ‘superpower’ fund, driving more rooftop solar adoption and community batteries, among other green initiatives.

Some policies are applicable to smaller traders, though. For example, the Coalition says if re-elected, it will deliver an energy reporting and climate change adaptation guide by the end of 2023, designed to boost preparedness among small businesses.

Both parties have also unveiled significant electric vehicle and EV charging promises, which you can read about here.

Other priorities

Hospitality businesses trading under a Labor government can expect a simplified outdoor dining application process, intended to slash the time it takes for traders to seek both the local council and NSW government sign-offs.

A NSW Labor government would also push to raise the penalties against those found to have assaulted a public-facing business employee, a move which has been welcomed by industry groups and unions alike.

Elsewhere, the Coalition’s 2023-2036 plan pledges $1,000 in funding towards small and micro-businesses, intended to help them attain professional support and advice.

After the supply chain shocks caused by COVID-19 restrictions, a string of natural disasters, and war abroad, a re-relected Coalition would appoint a Supply Chain Commissioner dealing specifically with transportation and logistical setbacks.

Given the myriad ways pandemic lockdowns reshaped Australia’s workforce, the Coalition says it will work with Canberra to fine-tune migration policy to help small businesses find the staff they need.