COVID-19 has seen nearly a quarter of Indigenous Victorian businesses cease operations in March, with even more set to shut their doors, according to a survey from Kinaway Chamber of Commerce.
The peak body for Indigenous businesses in Victoria, Kinaway surveyed their members in early March to measure the early effects of the pandemic on Indigenous businesses in the state.
With over 200 members, the organisation found COVID-19 had essentially obliterated the sector, with 22 percent immediately ceasing operations in March and predicting that by the end of May, 58 percent of Indigenous businesses would be closed in Victoria.
Kinaway Vice Chair and proud Meriam woman, Kerry Arabena, said the current data is in line with this prediction.
“What we’ve seen is … people haven’t been able to pivot and diversify what their offerings are [in] a business context,” Arabena said.
“Many of our organisations had built in a three-month buffer but beyond that … it would be very difficult to sustain over time.”
Although the Federal and State Governments have made business assistance packages available, such as through Indigenous Business Australia (IBA), businesses have struggled to receive much-needed support in time.
For Arabena, it’s the lack of administrative support that is the real killer.
“I think we’ve got a volume issue and a capacity issue,” Arabena said.
“There is a large number of people who are seeking that kind of support and administratively, it is just taking time to progress and process all of those opportunities.”
“With a lot of the different packages, they’re not specifically tailored to meet the people’s immediate needs.”
Arabena said many entrepreneurs are feeling a heavy responsibility to their employees, while trying to find ways to diversify and adapt during this pandemic.
Kinaway is currently trying to alleviate some of these pressures by providing consultation where possible for businesses struggling with diversifying.
“Sometimes you just need another set of eyes to come and help you identify strategic initiatives that will help work you through.”
Contractors falling through the gaps
Contractors have also been uniquely affected, as they are ineligible for JobKeeper through a business. They can only apply as sole traders.
Kinaway’s report on their survey explains that “JobKeeper does not include … contractors to the business”.
“In my example, I’m a sole trader and I do consulting work and if I’ve got additional work that needs to get done then I subcontract people,” Arabena said.
“That subcontracting relationship is appropriate for the size of my business at the moment.”
“The contracting relationship excludes me from being able to engage with any of the packages available.”
With 52 percent of the Indigenous Victorian business labour force being contractors, many are falling through the gaps of the Commonwealth’s economic safety net.
The flow on effects from this have the potential to reach families and communities.
“[People] are utilising their buffer zone in order to survive, that’s not a long-term strategic initiative that any organisation can sustain, let alone a fledgling Indigenous business,” Arabena said.
“For over half of our [member] businesses … to say that beyond the end of this month they’re likely to cease, will have a flow on effect for, not only other contractors, but the families of people, because many of our businesses are employing family members.”
The Vice Chair said many people are concerned about what their future may look like in terms of their operational capacity.
“Many of us have come from places and communities where poverty is real,” Arabena said.
“We thought that enterprise was the foundation for economic independence for our communities, and we’ve made good headway in that area.
“It’s just a real concern that the packages weren’t targeted specifically for our communities.”
A spokesperson from the Victorian Government said the Government is “consulting closely with Aboriginal businesses and lobby groups” to assist in their response to COVID-19 economic impacts.
“We know these restrictions have been tough on businesses and workers, but they’ve been essential in slowing the spread of Coronavirus and saving lives,” the spokesperson said in a statement to NIT.
“We’ve provided $285,000 to directly support Victorian Aboriginal businesses through to the other side of this crisis, on top of payroll tax relief, land tax deferrals and one-off cash grants open to the broader business community.”
The spokesperson said this funding has been provided through a partnership with Ngarrimili and Kinaway to support:
- Immediate accounting and tax preparation support to improve eligibility for State and Federal grants
- Indigenous businesses in accessing digital media training and resources to enhance their online presence while operating in this restricted trading environment
- Indigenous businesswomen by providing access to business skills resources and workshops.
“We’ll have more to say about further support for businesses, jobs and our economy in due course,” the spokesperson said.
Federal Minister for Indigenous Australians, Ken Wyatt, and Shadow Minister for Indigenous Australians, Linda Burney, did not respond to our request for comment by time of publication.
For now, Kinaway is offering a range of packages to Indigenous Victorian businesses as well as encouraging peer to peer support between members.
“This is unprecedented and I’m really proud of the way both the board and the team and our business community have come together to support each other,” Arabena said.
“I just think we have to facilitate a smooth administrative pathway for people to access the kinds of grants and other supports that are made available to them.”
By Hannah Cross