Govt announces small business support in Budget

The Albanese government has used its first Budget to announce two specific measures aimed at the small business sector.

First, the government will provide an energy savings grant program to reduce energy use and lower energy bills.

Second, it will fund free mental health and financial counselling support for small business owners.

In other changes, the government will increase paid parental leave for the primary caregiver from the current 18 weeks to 26 weeks by 2026. Also, from July 2023, Child Care Subsidy rates will increase by up to 90% for eligible families earning less than $530,000. This is designed to get mothers back into the workforce sooner.

Government targets unfair contracts

In the Budget documents, the government also highlighted its recent move to strengthen unfair contract protections.

On September 28, the government introduced legislation to crack down on unfair contract terms and increase penalties for anti-competitive behaviour.

The new legislation, if approved by parliament, would:

• Increase the maximum penalty for anti-competitive behaviour and certain breaches of competition consumer law
• Establish a civil penalty regime prohibiting unfair contract terms in standard form contracts
• Expand the class of contracts that are covered by the unfair contract terms

Assistant Minister for Competition Andrew Leigh said the bill provides greater protections for small businesses from unfair contract terms.

"The reforms will better protect consumers and small businesses from unfair terms, by reducing their prevalence in standard form contracts," he said.

"This will help to improve consumer and small business confidence when entering into standard form contracts. 

“Consumers and small businesses often lack the resources and bargaining power to effectively review and negotiate terms in standard form contracts [when] they are offered by a larger party."

Ombudsman welcomes reforms

Small business ombudsman Bruce Billson said he'd seen many examples of big companies imposing unfair contract terms on small businesses.

“We have seen contracts where a big company is allowed to cancel or vary the contract with two days' verbal notice, but the small business is required to provide 90 days’ notice in writing," he said.

“We have seen contracts where the big company is able to keep deposits for at least 12 months after the agreement with a small business ends with no fixed end date."

Mr Billson also said it wasn't enough just to introduce new laws; they also needed to be enforced by regulators.