The Institute of Public Accountants (IPA) has commended the ‘Affordable capital for SME growth’ report released on Friday (29 June) by the Australian Small Business and Family Enterprise Ombudsman (ASBFEO), saying it reinforces many of the sentiments held by the IPA.

“The IPA congratulates ASBFEO for its comprehensive report on the plight of SMEs who struggle to grow their businesses due to the lack of adequate capital, finance and support,” said IPA chief executive officer, Andrew Conway.

“The recommendations are very consistent with that contained in IPA’s Australian Small Business White Paper and these will be reiterated in the upcoming second edition.

“The next edition of the white paper, which incorporates new research conducted through the IPA Deakin SME Research Centre, will reinforce the access to finance problems that so many small businesses face every day.

“Australia must do everything in its power to support small business productivity and growth for the sake of our economy.

“Facts borne from the ASBFEO report such as small businesses’ 57 per cent contribution to GDP and the employment of 7 million people says it all.

“Our research confirms that small business continues to have problems with access to finance and capital; critical elements to support healthy cash-flow that underpins growth opportunities.

“It is also pleasing that ASBFEO included a recommendation for a government guarantee scheme. The IPA has long advocated for a state-backed loan guarantee scheme for small business since inclusion in our first white paper.

“Australia is one of the only countries in the developed world without such a scheme. In our view, a loan guarantee scheme would help increase the availability of much-needed, affordable loan finance to the small business sector.

“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.