Small business accounts for nearly 98 per cent of firms in the building and construction industry. These 344,000 small businesses are a key engine of productivity in the building and construction industry
Small building and construction businesses produce more than half the industry’s output and create almost a third of the jobs - well ahead of other industries.
Without a confident, energetic, entrepreneurial and innovative small business sector, we cannot have a strong building and construction industry, a strong economy, more liveable communities, strong employment growth, and more training opportunities.
What are the problems?
But too much of the drive and effort of small business people, including independent contractors, is dragged down by onerous taxes, over-regulation and excessive and complex compliance burdens.
The building and construction industry is one of the most intensely regulated industries in Australia, with legislation and regulation imposed at all three levels of Government.
Unnecessary over-regulation shackles the industry with ‘red’ and ‘green’ tape burdens sapping entrepreneurial effort and productivity. Red and Green tape impacts on all business, large and small, as well as by consumers who have to pay the higher costs of building homes and community infrastructure.
It stops small business from doing what it does best – creating jobs.
The next Federal Government must accelerate the process of removing regulation that is unnecessary, is out of date or duplicates regulation in other jurisdictions and simplify those that remain.
New regulations and legislation should only be allowed if a rigorous cost-benefit analysis has been undertaken and available for public scrutiny.
Closer and deeper engagement with the business community – both in terms of assessing the costs of new regulations, and in undertaking the review and reform of existing regulations – is essential.
How can we fix them?
- Delivering a small business-friendly regulatory environment and boosting confidence through stable economic settings.
- Targeted measures to assist small business employers to take on more apprentices and help to increase the completion rates for building trade apprentices.
- Streamlining and simplifying development approvals processes to help smaller businesses stem the growing shortfall in new housing supply.
- Simplified tender processes and reduced costs to encourage more small businesses participation in government funded building and construction projects.
- Removing unnecessary and non-productive business regulations and reducing the compliance burden of remaining regulations.
- Subject all new regulations impacting the building and construction industry to a transparent and rigorous cost-benefit analyses.
- Simplify business tax compliance, recognising that inefficient collection and administration of taxes distort economic decision-making, and divert resources which could otherwise be used more productively elsewhere.
- Assist small businesses by reducing the broader complexity of taxation and industrial relations laws, tackle the compliance costs of regulation, increase their ability to access debt and equity finance and do more to facilitate their participation in government procurement.