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State-backed loan guarantee scheme for small business proposed

The Institute of Public Accountants (IPA) has introduced an Australian Small Business White Paper renewing its call for a state-backed loan guarantee scheme for small business.

The paper was launched at a special event in Parliament House on Wednesday, 12 August and makes a number of key recommendations.

IPA chief executive officer, Andrew Conway said “it was pleasing to see that such a scheme would be contemplated by the Opposition when it made its 2015 federal budget response in May but we want Australia to move forward on this initiative now.”

Mr Conway said that Australia was one of the only developed countries without such a scheme and would result in the increased availability of affordable loan finance to small business.

“A limited State-backed guarantee would encourage banks and other commercial lenders to increase loan finance available to small business at affordable rates. Access to responsible and affordable finance will help many small businesses reinvest in their businesses and help create new ideas, new capacity and new jobs,” Mr Conway said.

The Australian Small Business White Paper also recommended that the government pilot a SME guarantee scheme exclusively for capital investment projects and one exclusively for international market development projects.

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