RISING ENERGY COSTS CURTAILING SME GROWTH; OMBUDSMAN BLAMES PRICE GOUGING, POLITICS

Research showing that SMEs are reducing capital expenditure due to rising energy prices has prompted criticism of the state governments by the Australian Small Business and Family Enterprise Ombudsman.

The Ombudsman, Kate Carnell, pointed to the latest East & Partners SME survey* of 1280 businesses, which showed that 39.5% of SMES plan to scale back short-term capital expenditure due to higher energy prices, while 20.8% will scale back capital expenditure in the long-term, and a further 9.9% will reduce capital expenditure in the short and long-term.

“Effectively, more than 70% of SMEs are telling us the current energy prices will impact their investment in their business, particularly their capital expenditure – that’s a really big, high figure,” she told Dynamic Business.

“If they’re not investing in capex, that will affect business growth and, in turn, the overall economy. Fortunately, there some steps SMEs can take to address rising energy costs, such as having an energy audit. We’ve found that an energy audit can show a business how to reduce their energy costs quite significantly. Also, it would be worthwhile looking at how energy costs could be reduced through an energy broker who buys in bulk for a range of small businesses.”

Despite suggesting ways for SMEs to reduce their energy expenditure, Carnell said the ‘overarching message’ from her office was that the energy crisis was real issue for SMEs and that “all levels of government, along with all political parties, must stop playing politics and endorse the Finkel Report“. Read more

James Harkness - Dynamic Business - 13 Oct 2017