Business

$20m booster: SA small businesses and green technology to benefit from Economic Recovery Fund Round 2

Up to 8,000 small businesses and not-for-profits investing in energy efficient equipment will receive support from Round 2 of the Economic Recovery Fund

The Malinauskas Government is set to roll out a significant financial aid package directed at small businesses in South Australia.

This initiative, funded by a dedicated $20 million allotment from the State Budget, forms part of the continued efforts under the Economic Recovery Fund (ERF). Round 2 specifically focuses on fostering investments in energy-efficient technologies.

This upcoming phase of the ERF aims to benefit up to 8,000 small businesses and not-for-profits. It is structured to offer grants from $2,500 to $50,000, matching business investments in eligible equipment on a dollar-for-dollar basis. The primary goal is to encourage enterprises to integrate or enhance energy-efficient practices, which will aid in cost reduction and support the global shift towards a net-zero emissions environment.

The $154.2 million ERF launched in early 2023 made substantial contributions in its first round, dispersing $26.3 million among various beneficiaries, including those in the manufacturing and tourism sectors.

One notable recipient, the Lonsdale-based defence and space firm REDARC, received a significant $2 million to aid in the early phase of establishing a Defence and Space Centre of Excellence. This specific allotment contributes to job creation—60 new full-time positions—and enhances the skills of 23 current staff members. Moreover, it is expected to propel REDARC’s exports by an impressive 145 per cent, achieving $24.3 million.

State Treasurer Stephen Mullighan provided clarity on the benefits of each round, saying:

“Round 1 has already benefited 17 South Australian companies, helping them to grow and become more competitive.”

“Round 2 will see the government partner with small businesses to help them reduce energy costs not just now but for the long term.”

“South Australia is the lowest taxing jurisdiction on the mainland and we’re committed to ensuring the best possible conditions for current and future small business owners.”

Applications for Round 2 are scheduled to open in August 2024. Interested businesses are encouraged to register their interest on the Office for Small and Family Business official website.

Andrea Michaels, who advocates for the financial support measures, pointed out the considerable role that small businesses play in the region, comprising 98% of all South Australian businesses.

“We are acutely aware of the increased costs of doing business in recent years and Round 2 of the Economic Recovery Fund will make a practical difference in addressing the issue in both contributing dollar for dollar to important small business investment decisions but also resulting in ongoing reduced energy and other operating costs”

Adding a commercial perspective, Anthony Kittel, Managing Director of REDARC, shared his vision for the project’s impact on the company and broader industries. He noted the initiative would elevate REDARC Defence & Space to a Tier 2 status within the Australian Defence industry. Furthermore, it aims to expand the South Australian space ecosystem and solidify REDARC’s reputation as a leader on the international stage.

In concluding remarks, government officials and industry leaders expressed a common commitment to enhancing the operational landscape for small businesses in South Australia. This commitment aligns with the state’s broader economic strategies, including maintaining a competitive tax environment, as highlighted by Treasurer Mullighan.

With its targeted aid and investment-matching premise, the continuation of the Economic Recovery Fund stands as a proactive endeavour to support this vital sector during a critical recovery phase for the global and local economy.

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