‘Golden opportunity’ for RegTech: Carnell


Denham Sadler
Senior Reporter

There is a “golden opportunity” for RegTech to help Australia’s economic recovery and a new panel needs to be established to help SMEs access government contracts, according to Small Business Ombudsman Kate Carnell.

Speaking at the National Press Club on Tuesday afternoon, Ms Carnell pushed for small and medium-sized entities to be placed at the centre of Australia’s economic recovery, with efforts made to cut red tape and open up government contracts.

The Ombudsman pitched a new Small Business workplace award which would include a new “permaflexi” classification that would provide an alternative to a ‘casual’ work classification and include holiday and sick leave, while retaining flexibility.

Kate Carnell
Kate Carnell: Local small businesses must be tapped to drive the economic recovery

RegTech systems and platforms should be adopted by government to help with the introduction of this new scheme and as a way to streamline compliance for SMEs, Ms Carnell said.

“RegTech translates complex legislation into easy to use solutions. Imagine if a small business owner had technology at his or her fingertips that by putting in basic details such as the employee’s age and hours worked – could instantaneously provide the employer with the correct wages and entitlements owed?” Ms Carnell said.

“The good news is that the technology exists already. The Fair Work Ombudsman just needs to accredit RegTech solutions for this purpose,” she said.

“The government has a golden opportunity here to modernise complex systems and cut red tape. It’s meaningful changes like this that are going to give the small business community the confidence they need to start hiring again.”

Ms Carnell urged changes that would make it easier for local SME’s to get access to government procurement dollars.

In 2018-19 there were nearly 80,000 contracts published on AusTender, worth a combined value of $64 billion, Ms Carnell said. But only just over 25 per cent of these went to SMEs, despite nearly 95 per cent of them being worth less than $1 million, and more than half worth less than $80,000.

“It’s clear small businesses should get a larger slice of that pie. But small businesses often don’t get a look in because the first step of the procurement process often requires the business to be on a panel. This can be an extraordinarily costly and onerous exercise and doesn’t even guarantee an opportunity to tender,” Ms Carnell said

“The culture of risk-averse government departments handing contracts to big businesses needs to be a thing of the past.”

A new SME procurement panel should be established for Commonwealth contracts worth up to $10 million, the Ombudsman said, and government departments should have to actively explain why an Australian SME missed out on a contract.

“One of the reasons for this is to grow small businesses and develop a strong middle-sized business sector in Australia, which is fundamental for growth. Remember lowest cost does not always represent the best value for money,” Ms Carnell said.

“I would argue strongly that prioritising Australian SMEs will pay dividends to the entire economy.”

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