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What’s in the new Federal Budget for small businesses?

From skilled migration to energy grants to paid parental leave, here are six of the potential wins for small business owners in the October Federal Budget.

At a glance

Small business highlights from the new 2022-2023 Federal Budget:

  • Fee-free TAFE is high on the agenda for the new Federal Government, which has promised 480,000 places over four years.
  • Small businesses might also benefit from the $42.2 million promised to accelerate processing of skilled migrant visas.
  • Paid parental leave will be expanded from 20 to 26 weeks across three years from 2024 to 2026.
  • Funding is promised for individuals and businesses impacted by natural disasters.

1. Fee-free TAFE places

A major announcement touted by the Government in the new Federal Budget is the provision of 480,000 fee-free TAFE and vocational training positions across four years.

The Government says it represents an investment in skills and training for workers across multiple industries. For example, it may benefit existing staff of small businesses looking to upskill or add a new qualification to their CV – which allows owners to add value to their workforce while retaining staff in their current roles.

“As a first step, the Government is entering a $1 billion agreement with the states and territories to provide 180,000 places in 2023,” said Federal Treasurer Jim Chalmers.

The scheme aims to target industries with severe skill shortages, with the Government also looking to update TAFE facilities and workshops.

2. Energy efficiency grants

Inflated operating costs and the increasing price of power can threaten growth plans and have owners reaching into their back pockets more often than they’d like.

The Budget sets out to address this by offering new energy efficiency grants to small and medium-sized businesses to encourage them to improve their energy efficiency and reduce energy use.

A commitment of $62.6 million aims to “put downward pressure on power bills” and reduce businesses’ impact on the environment.

3. Workplace relations and wellbeing support

Growth can often take tenacity and grit – and achieving business goals is often a team effort.

The Government says it will work with small businesses, workers and industry platers to create a “simpler, more accessible and fairer workplace relations system”.

According to the Budget announcement, this includes “removing complexity to help small businesses reach agreements with their employees, providing bargaining support for small businesses and assisting small businesses to implement new family and domestic violence leave entitlements for their employees”.

This year’s Budget also includes a provision of $15.1 million to extend NewAccess for Small Business Owners and the Small Business Debt Helpline, which are mental health and financial counselling programs specifically designed for small business owners.

4. Expansion of skilled migration

Skilled worker shortages are a challenge for many small business owners, requiring innovative ways to recruit and retain talent.

The allocation of $42.2 million to accelerate visa processing and reduce the visa backlog could prove welcome, then, for owners who hire staff from overseas.

Australia’s permanent Migration Program will also be expanded to 195,000 places in the 2022-2023 financial year, representing an increase of 35,000, the Government announced.

“Student and secondary training visa holders will have their work restrictions relaxed until 30 June 2023. This will allow them to work additional hours in any sector, helping to address workforce shortages,” reads the announcement.

5. Expansion of paid parental leave

In an announcement that will have repercussions for workers across all businesses, the Government plans to increase paid parental leave to 26 weeks across the next four years.

The change comes after the previous Budget more evenly split the current 20 weeks of parental leave between two parents (but did not increase the leave available).

The changes encourage both carers in two-parent families to take parental leave – or lose a portion of the leave entitlements.

The scheme is expected to cost the Government $531.6 million until 2026, by which point parents would be able to access 26 weeks of paid parental leave between them – that’s a full six months.

An additional two weeks will be added each year from July 2024.

6. Further disaster funding

Extreme rain, flooding and other natural disasters of the past year have impacted Australian small businesses, whether directly or through the associated supply chain and market constraints, and those businesses have had to pivot to face challenging conditions.

Emergency disaster funding for small businesses was included in the previous Government’s Budget in March, and the latest Budget includes a similar provision.

In addition to $3 billion already “in contingency reserve to meet the disaster recovery costs from the flooding events this year”, the Government is allocating $200 million towards disaster prevention and resilience initiatives.

According to the Federal Budget website, the funds will “help support state efforts to alleviate the immediate hardship being experienced by communities and businesses”.

For more information about the October Federal Budget, visit the Federal Budget website.

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The information in this post is provided for general information only and does not take into account your personal situation. Nothing contained in this post constitutes advice or an endorsement or recommendation of any kind by Prospa. Any links to third party websites are strictly for informational purposes only. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from financial, legal and taxation advisors. Although every effort has been made to verify the accuracy of the information as at the date of publication, Prospa, its officers, employees and agents disclaim all liability (except for any liability which by law cannot be excluded), for any error, inaccuracy, or omission from the information for any reason, including due to the passage of time, or any loss or damage suffered by any person directly or indirectly through relying on this information.

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