Business Council calls for JobKeeper-like program after disasters

Mogo business owner Karl Niehus sifts through the wreckage of his businesses. One in four businesses in Mogo burnt down during the fires. Picture: Karleen Minney
Mogo business owner Karl Niehus sifts through the wreckage of his businesses. One in four businesses in Mogo burnt down during the fires. Picture: Karleen Minney

Businesses impacted by natural disasters should be able to access a JobKeeper-like wage subsidy program, the Business Council of Australia has argued.

Business Council of Australia chief executive Jennifer Westacott told the Royal Commission into National Natural Disaster Arrangements on Friday the indirect effects of the 2019-20 bushfires had been devastating for business.

And while the coronavirus has been another hammer blow to businesses in bushfire-affected communities, Ms Westacott said the JobKeeper program had been a saving grace.

"We've called for something like JobKeeper, a wage subsidy coming into place very quickly in the advent of a disaster," Ms Westacott said.

"In the case of small businesses, they're indirectly but critically impacted by a loss of demand, a loss of customers, loss of business. So some of those permanent things if we could just ramp into action rather than having to design them would give everyone that sense of being able to get business continuity."

BizRebuild's Lisa Paul said the indirect effects of the fire had been more widespread and more profound for businesses.

The National Bushfire Recovery Agency has estimated around 400,000 businesses are in fire-affected communities. In a town like Mogo, 25 per cent of businesses were lost, Ms Paul said.

"The number of small businesses that reported to us they had not been flame-affected, they had not even been smoke-affected but they had lost their entire summer season which might represent anywhere between 40 per cent to 90 per cent, we heard that again and again," she said.

Ms Westacott said the staunched cash flow had been crippling for businesses trying to recover.

"I think people often forget that small businesses and sole traders in particular live on very thin cash balances. They do not have a big balance sheet as a major corporation might have. So the immediate cessation of that cash meant people could not see beyond the next couple of weeks, they could not see how they could get back up on their feet," Ms Westacott said.

"If there was something like the JobKeeper program, which in my view has been a nation saving initiative ... we could quickly swing it into effect in the event of a disaster.

"And then a disaster supplement, such as the coronavirus supplement because again some people tragically do lose their jobs because they are not able to be kept on as part of a small business, or, you know, demand simply drops off and that supplement on top of what was the traditional Newstart allowance we believe would allow people to have that cash adequacy and give them a capacity to not fall into abject poverty."

Ms Westacott said the measures could be supported by a low documentation $10,000 grants scheme, like the one that's been in operation after the last fires.

"We are suggesting respectfully that the documentation required for that be as simple as possible, and as easy to access as possible," she said.

The evidence came as federal and state governments extended the deadlines for primary producers and small businesses to apply for bushfire recovery grants.

"This decision also highlights the level of understanding by federal and state agencies that the recovery journey is different for everyone and some may not be as progressed on their journey as others," Minister for Agriculture, Drought and Emergency Management David Littleproud said.

In May, it was revealed only 3 per cent of businesses in bushfire-affected areas had qualified for a concessional loan or grant from the federal government, amid criticism the scheme was too bureaucratic.

This story Business Council calls for JobKeeper-like program after disasters first appeared on The Canberra Times.