03 January 2024

Originally published in The Daily Telegraph

By Bruce Billson.

When a bushfire, storm, flood or other natural disaster strikes, small business owners are often the first to volunteer to fight fires, lay sandbags, assist with evacuations and help with the clean-up.

Just like the businesses they run, they are the lifeblood of our communities. Yet the overwhelming majority of our small and family businesses do not have a current disaster preparation plan as we head into what is already becoming a challenging summer. An inquiry by my office found only one in four have a current business continuity plan. 

Natural disasters can be devastating for small and family businesses — either their business is directly damaged or wiped-out or they are an indirect victim who has survived the disaster only to have no customers because of the impact on their town or region.

Taking simple steps to be better prepared, sensible risk mitigation action and bolstering resilience can help small and family businesses to get back on their feet quicker. Some 97 per cent of money spent by governments on disasters is after the event and only three per cent is on preparedness.

I urge small and family businesses to get prepared. This can be as simple as ensuring your record keeping is up to date and that critical information is at hand and, where possible, digitised so you can retrieve it if your business is destroyed.

Do you have the contact details for your customers, suppliers, staff, accountant and other important people in a safe place? Are your payments to relevant bodies such as insurers, lenders and the Tax Office up to date? Do you have copies of relevant accounts, passwords and backups of important operational data? Would it be feasible to continue operating from another location?

As part of our Small Business Natural Disaster Preparedness and Resilience Inquiry, we recommended the creation of an opt-in “My Business Record” to allow a small business to digitally store all relevant government-held and other vital information it might need after a disaster. 

It is clear from our work that preparation is key to small and family businesses building resilience and coming through natural disasters in the best possible shape.

It is equally clear they cannot do this on their own and when a natural disaster strikes, certainty of response and certainty of support must be provided. By this we mean small business owners should automatically be engaged in local place-based planning and support services and be elevated and ‘front of mind’ in disaster response, recovery and funding arrangements. 

This must include indirectly affected businesses. We believe a business hub should be established to provide a single point from which to seek help from government and non-government agencies. And we strongly recommend a “tell-us-once” triage system should be adopted to save small business owners the trauma and time associated with repeating their story.

In the aftermath of a disaster, it is important to have ongoing support. So, when a small business receives an Australian Government grant, we recommend an additional amount should be made available six to nine months later for a “business health check”. 

We also need an integrated response to disaster risk management for identified disaster prone areas that incorporates priority access to mitigation expenditure, co-ordinated planning across levels of government, infrastructure hardening, interest free loans for asset and activity protection and relocation schemes and possible use of a dedicated reinsurance vehicle.

And in keeping with our small business owners and employees being regular volunteers, we have backed the idea of a government subsidy to be available when workers in a small business are called out for volunteer work for an extended period or a business is required to scale back operations because of volunteer activities.

Sadly, too often we have seen how natural disasters can cause lasting harm to the enterprising women and men building businesses, employing local community members, and contributing to the Australian economy. Small business creates vitality in our communities, employs two out of every five people with a private sector job and contributes one-third of our GDP, so it is absolutely worth building its resilience.