11,000 business loans remain postponed: Kate Carnell calls for additional support

Australia’s Small Business and Family Ownership Ombudsman Kate Carnell has called on the Victorian government to go further in compensating small businesses, following the five-day lockdown over Valentine’s Day weekend .

Carnell said the Andrews government recently announced support package does not go far enough to compensate small businesses that have been hit by the foreclosure, which has seen many businesses miss a high-trade weekend.

“An abrupt five-day lockdown forced small businesses across the state to shut down before what many thought was the busiest trading weekend in months.

“While some small businesses are getting back on their feet, there are still a lot that aren’t.

“Over 11,000 business loans remain deferred and 493,000 businesses were still receiving JobKeeper as of December 2020.

“Unfortunately, the Victoria government’s recently announced support program will not cover the costs that small businesses would have to incur as a result of this latest foreclosure.

“Compensation should cover all costs associated with running a business, including loss of inventory, staff salaries and rent,” she said.

Meanwhile, many small businesses are also bracing for the end of JobKeeper later this month, as well as paying full rent and deferred rent, depending on their agreement with their landlord.

Carnell has also expressed concern for small businesses as the Australian Revenue Authority (ATO) begins to collect unpaid debts.

Carnell said she was concerned that small businesses could be subject to the harsh debt collection measures used before the COVID pandemic, given that the recoverable debt owed to the ATO peaked at $ 34 billion – the majority of which is owed by small businesses and a loan from actual lender is ($ 21 billion).

“The ATO has rightly taken a softer approach to small businesses during the COVID crisis, but we don’t want to see a return to the extreme enforcement measures my office brought to light just a few years ago. years, ”said Carnell.

“Previous actions such as garnishment notices have crippled small businesses, so it is essential that the ATO uses its powers in a proportionate and appropriate manner, especially when small businesses are struggling to get back on their feet.” , she said.

There is one avenue of help, however, as small businesses struggling with their finances can access a new service through the Australian Banking Association.

“Small businesses in difficulty can now access a new financial assistance center, to help them repay or restructure their bank loans.

“The Australian Banking Association (ABA) initiative was created to provide tailored assistance to small business owners who are unable to meet their loan repayments,” she said.

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