Govt ‘missing in action’ on digital SMEs

Denham Sadler
National Affairs Editor

More needs to be done to help Australian SMEs improve their cybersecurity and digitisation, with the government’s handful of policies in the space so far proving underwhelming, the Labor industry spokesman Brendan O’Connor has warned.

Australian companies are not prepared for the increasingly digitised economy compared to their international peers, and the ongoing COVID-19 pandemic has shone a spotlight on this and made the issue even more important, he said.

The two main policies from the Coalition that were meant to assist SMEs in improving cybersecurity and digital readiness have fallen flat. A grants scheme for small firms to conduct cybersecurity audits has now closed after being accessed by only 35 companies, despite it allowing for more than 5000 grants.

SME focus: Government must do more to address SMEs and the digital economy

Another program offering up $3 million to assist businesses to go digital is yet to allocate any funding.

Mr O’Connor recently wrote to Minister for Employment, Skills. Small and Family Business Michaelia Cash urging the government to introduce more policies to assist Australian SMEs to digitise, with a focus on cybersecurity.

“I am asking if the government has considered further substantial programs to assist Australia’s small businesses to digitise and adapt to the digital marketplace, including their cybersecurity,” Mr O’Connor said.

In a submission to the National COVID-19 Coordination Commission, CPA Australia said local SMEs are the most likely in the Asia-Pacific to not make any investment in technology last year, according to its survey.

“Australia’s small businesses continue to be the least likely to use social media for business purposes across the region…[and] continue to be the least likely to earn revenue from online sales,” the submission said.

This shows that more needs to be done by the government to help these businesses adapt for the digital economy, Mr O’Connor said.

“Too many small businesses in Australia aren’t prepared for the increasingly digitised economy or the concerning threats from cybersecurity, but rather than supporting small business, the government is missing in action,” Mr O’Connor told InnovationAus.

“COVID-19 has shone a light on the need for a strong digital presence and security system for small businesses. I have written to the government asking them to outline what substantial programs are in train to assist small business improve their cybersecurity and adapt to the digital marketplace, because quite frankly more needs to be done.”

Two of the main policies in the space have proved to be underwhelming.

The government’s Cyber Security Small Business Program provided grants of up to $2100 for SMEs to undertake cybersecurity checks. Despite being provided with $10 million, only 35 businesses had accessed the scheme before it was shelved.

“I understand this program was not fully subscribed with many industry and cybersecurity experts citing the program as ineffective. However, given one in four Australian small businesses were victims of cyber-crime in 2017, this issue is of increasing importance,” Mr O’Connor said.

The Australian Cyber Security Centre recently found that nearly half of Australian SMEs spent less than $500 on cybersecurity in the last year, and only 5 per cent reported having implemented the Essential Eight cybersecurity precautions.

And only 17.6 per cent of Australian small businesses stated they believe a cyber-attack on their business is likely this year, compared to a 37.5 per cent average around the world.

The grants of up to $2100 were meant to cover half of a cyber health check for a company with 19 employees or fewer. It had a budget of $10 million when it was launched in late 2018, with estimates that 5500 businesses would take part. But it was revealed at senate estimates late last year that only 35 SMEs accessed it, and the scheme is now closed.

A recent report by the Cyber Security Cooperative Research Centre also found that COVID-19 has widened the cyber gap between large businesses and SMEs, with smaller firms increasingly vulnerable to attacks.

Another program in the space, Empowering Business to go Digital, offered a single grant of up to $3 million to a private company to “build and enhance small business digital capability” and address recommendations from the Small Business Digital Taskforce. These recommendations included an award program, roadshows and an annual event for small businesses.

The funding is still yet to be allocated and isn’t enough to address the significant issues in the space, Mr O’Connor said.

“It is unlikely that the $3 million will substantively address the many hurdles small businesses face to digitise. The assistance this will offer small business is of a much smaller scale than responses in jurisdictions like Hong Kong of up to $60,000 for successful applicants, or Singapore’s E-commerce Boost Program,” he said.

With the cybersecurity check program closing, the government pointed to other policies looking to assist SMEs to digitise, including the business management elements of the Entrepreneurs’ Programme, and range of other government advice and the Stay Smart Online alert service.

Senator Cash’s office did not respond to a request for comment.

Do you know more? Contact James Riley via Email.

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