Login
iscover
The rising pressure of new regulation is fast emerging as the top concern for NSW small businesses, according to the NSW small business commission.
Newsletter
SMEs in constant fear of red tape, survey reveals
22 November 2024
•
12 minute read
You’re out of free articles for this month
To continue reading the rest of this article, please log in.
Create free account to get unlimited news articles and more!
Recent surveys conducted by the NSW small business commission revealed small business owners are more concerned about red tape rather than weakened demand, rising inflation and high interest rates.
The commission said the 850,000 small businesses in NSW had faced a period of unprecedented instability which had been impacted by multiple contributing factors.
The surveys found only seven per cent of respondents said they felt regulation was designed around the needs of small businesses and only 13 per cent indicated they were confident regulation achieved outcomes of net benefit to the community.
The commission said this was a “very real problem” and small businesses should be more confident about the merits of the regulation they were expected to comply with.
It was also noted by the commission that it made nine recommendations in the recent Rightsizing Regulation report to improve regulatory policymaking and ensure regulation is designed with small businesses in mind.
“This includes improvements to consultation, but also small business impact statements to assess how proposed regulation might affect small businesses,” the commission said.
==
==
“This analysis would drive cultural change, ensure small business needs are considered and is consistent with best-practice approaches implemented in other jurisdictions such as the UK, EU and Canada.”
Despite the growth in red tape concern, the survey also highlighted that small businesses wanted to operate in an ethical and responsible manner and were happy to comply with requirements.
However, respondents expressed they didn’t want to feel “weighed down” and were frustrated when required to comply with rules and requirements that imposed an unreasonable impost on their ability to get on with the job of running an SME.
The commission said increased levels of red tape put small business operators at risk of being “crowded out” by larger businesses with more resources and capabilities.
“The consequences of poorly designed regulation include the very real human costs of reduced amenity in regional and remote communities, people losing their livelihoods and reduced economic opportunity,” the commission said.
“The recommendations in the report support smarter regulation by tailoring requirements, streamlining processes and exempting small business when they are not a major contributor to a problem requiring regulatory intervention.”
The commission called for increased SME involvement at regulation level as the mental load, stress and cost of complying with complex requirements could make or break a small business.
“Better regulation is developed in collaboration with small business, it is mindful of the need to balance the cost benefit equation and should safeguard the interests of both consumers and small business.”
“Without a healthy small business ecosystem, we won’t have the competitive dynamics required for a healthy economy that serves the interest of our community, prices will continue to rise and investment will stall if we continue to weigh business down with excessive and poorly designed regulation.”
You are not authorised to post comments.
Comments will undergo moderation before they get published.