NSW Budget: $325 rebate for SMEs in cost-of-doing-business crisis

The New South Wales government has opted not to match the $325 energy bill rebate provided by the federal government, in a state budget industry experts have called a mixed bag for local traders and startups.

The 2024-2025 state budget, handed down on Tuesday by NSW Treasurer Daniel Mookhey, pledges to pass on the energy bill rebate promised in this year’s federal budget but without any extra rebates for SMEs.

The announcement comes just days after Queensland promised to match federal funding, providing small businesses with up to $650 in energy bill rebates for the financial year.

NSW’s decision not to match the guaranteed federal funding comes as the state projected a $3.6 billion deficit for the 2024-2025 financial year, down from last year’s projections of a $844 million surplus.

The adjusted numbers are largely the result of revised GST revenue expectations, Mookhey said on Tuesday, which will see the state lose out on $11.9 billion in GST revenue over the next four years.

Business Bureau funding, agribusiness support, and more

While small businesses should not expect state-funded energy bill rebates, the NSW government has committed some extra funding to SME-facing initiatives.

The Service NSW Business Bureau — the newly-created government body tasked with assisting SMEs through thickets of government regulations, procurement processes, and self-described “red tape” — will receive a further $5 million, taking its total funding through 2024-2025 to $30 million.

The Service NSW Business Bureau has already dealt with more than 100,000 businesses, and offered more than 20,000 hours of advice to small businesses within its first six months of operation, according to the budget papers.

It has been “critical in assisting businesses impacted by disasters, including those affected by the tragic events in Bondi Westfield and businesses impacted by sinkholes from the M6 tunnel,” according to the state government.

In regional NSW, $45 million in taxpayer funding will be deployed to assist farmers and agribusinesses adopt new digital technologies and communications systems.

The state government says these upgrades can improve resource management, elevate productivity, and shore up water security.

Additionally, $5 million will be deployed in the form of low-interest loans to eligible SMEs across regional NSW, in the hopes of bolstering economic growth and employment in the regions.

In the tech and startup space, rental subsidies for eligible tenants of the Sydney Startup Hub will top $4 million in 2024-2025.

The budget also provides $35 million for Screen NSW’s Made in NSW Fund, which supports eligible feature films, telemovies, animation, mini-series and TV series using NSW as a production destination, and pledges $26.9 million for the state’s night-time economy precincts, and the delivery of the state’s updated 24-Hour Economy Strategy.

Small business duty exemptions, covering commercial vehicle, commercial aviation, professional indemnity, and product and public liability insurance, will cost taxpayers $95 million through the upcoming financial year.

Further NSW government commitments include:

$188.8 million in historical payroll tax waivers for general practitioners working in contract roles, and ongoing tax rebates for bulk-billing medical clinics;
$205 million to help ID Support NSW, the state’s identity theft support platform, to enhance cyber resilience and help those affected by data breaches;
$62.5 million to expand the digital licensing scheme to a further 80 NSW qualifications;
$21.4 million for NSW Digital ID and Wallet, as the state pursues a digital-first future for qualifications and identifying documents;
$73 million towards grassroots and community arts organisations; and
$18.5 million for Sound NSW, to both build the international audience for local artists and bolster the local live music sector.

Mixed reviews from industry onlookers

Industry onlookers say the budget is somewhat encouraging for the state’s business community.

Fleur Brown, chief industry affairs officer for the Australian Retailers Association, praised the state’s continued focus on traineeships and apprenticeships to build the state’s future workforce.

But extra support could have been shown to businesses struggling through a tough trading environment, she said.

“It’s disappointing there is no immediate relief in this budget to help offset the higher costs of doing business – such as changes to payroll tax or energy rebate incentives to complement the rebates announced by the federal government,” Brown said.

CPA Australia was also disappointed that the budget failed to include “any significant measures to alleviate business costs and ease the regulatory burdens on businesses”.

“While the budget had a strong focus on balancing the books, everyone in New South Wales stands to benefit from a budget where business was more at its centre,” said Gavan Ord, business investment and international lead for CPA Australia.

Despite the continued funding for the Service NSW Business Bureau, Employment Hero co-founder Ben Thompson suggested small businesses could use further administrative and financial support.

“Overall, it will be interesting to see how the government adjusts its strategy in the coming months, and whether more targeted support for businesses will become a priority,” he said in a statement provided to SmartCompany.

“With more and more businesses failing every day, we — alongside thousands of business owners — hope that additional assistance is provided.”

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