Local Government and Red Tape
For years now, local businesses have identified excessive regulation and red tape as a barrier to starting up and growing. This is a key issue for small businesses, given that they have only limited resources. Although economic development is not a mandated activity through the Local Government Act 1995, the sector plays an active role in driving economic development outcomes in their local communities.
Particularly through the planning, infrastructure and service delivery functions, Local Governments have a direct impact on economic activity, but can also influence the economic environment through the creation of vibrant and liveable communities. Reducing red tape is an important priority for the Western Australian Local Government Association (WALGA) and its 139 member councils, and was identified by WALGA in its 2019 Economic Development Framework as an important way for Local Government to support local businesses and economic development.
Many Local Governments are progressing red tape reform initiatives as part of their economic development activities. For example, the Cities of Canning, Gosnells and Victoria Park have partnered to introduce a Simplified Trading Permit, which allows registered food businesses to trade at events in any of the participating Local Governments without going through a full application each time.
WALGA is also working collaboratively with the State Government to identify and progress reform priorities, and is a member of its newly formed red tape reform working group established by the new Minister for Local Government, Hon John Carey MLA.
A further positive development where the State and Local Governments are working together to reduce red tape is the Small Business Development Corporation’s Small Business Friendly Approvals Program, which aims to streamline the process of obtaining business licences and trading permits from Local Government authorities. The Program was introduced as a way to assist with the economic recovery following the COVID-19 pandemic, and is only available to those Local Governments that are participating in the SBDC Small Business Friendly Local Government initiative. As well as supporting the recovery from COVID-19, the program also looks to support the diversification of the economy over the longer term by supporting small businesses to start up and grow.
The Small Business Friendly Approvals Program will deliver lasting benefits by identifying opportunities and reforms that will permanently reduce the regulatory burden and make it easier for small businesses. This will not only support the recovery from COVID-19, but also assist with the growth and diversification of the WA economy over the longer term.
The Program was trialled in 2019 in two Local Governments, and successfully delivered 61 recommendations to reduce approval timeframes, improve services and reduce costs for small businesses.[i]
These benefits are being translated into real reforms. For example, the City of Stirling has developed an Action Plan outlining reforms that will support the implementation for the Program’s recommendations. This has been adopted by Council, and is being rolled out during 2019 and 2022. The identified reforms are expected to reduce approval timeframes for development applications by more than 30 days, and result in significant time and cost savings for small businesses.[ii] The initiatives that were identified focus on the speed of approvals, and focus on improving business customers’ access to early information and guidance, better customer service, and process efficiencies.
The success of the program has seen the State Government provide additional funding for the program to be extended to 20 Local Government authorities in 2020-21 and 2021-22.
WALGA is calling on the State Government to provide $1.2 million in 2022-23 to extend this program for an additional year to enable a greater number of Local Governments to participate and for the benefits to small businesses in terms of reduced approval timeframes to be realised more broadly across the State.
WALGA has received positive feedback from participating Local Governments, and there are a number of Local Governments that would like to participate but missed out on the current funding round. Further, there is an opportunity to provide a more tailored program to regional Local Governments that may not have the scale or resources to participate in the program in its current form, but have a desire to support their small business community and reduce red tape.
Unnecessary red tape is a burden for both the business community and the Local Government officers dedicated to community and economic development. With support from the State Government an opportunity exists to deliver legislative and regulatory outcomes that all West Australians will benefit from.
[i] Media Statements - Rules streamlined to boost COVID-19 economic recovery
[ii] Stirling speeds up approvals for small business - City of Stirling