By Paul Hemsley and Julian Bajkowski

The New South Wales state government led by Premier Barry O’Farrell has mounted an ambitious push to make councils more “small business friendly” through a new carrot-and-stick regime that will reward achievers with a certificate but also publicly list laggards that the state and shopkeepers believe need to lift their game.

The bold new approach is being tested through a pilot program which seeks to boost councils’ responsiveness to the needs of businesses through an arrangement between the NSW Office of the Small Business Commissioner and commercial lobby group the NSW Business Chamber.

The pilot project is being sold to the community as a “first of its kind in Australia” in terms of increasing number of councils proactively engaging with small business.

For councils keen on the scheme, NSW Small Business Commissioner Yasmin King’s has announced that a “certification program” will be run to recognise those local governments who want to better understand the best ways to regulate and evaluate relations between local authorities and the small business sector.

Components of the pilot include a “Small Business Friendly Charter” that outlines key principles, a “diagnostic evaluation tool” to help councils identify strengths and weaknesses, and a “tiered recognition system” to ranki efforts in engaging with small businesses.

Although contentious, the implementation of rankings for councils will give businesses in local government areas a useful tool with which to hold bureaucrats to account.

The pilot program will be initially rolled out within Parramatta City Council as the test bed for city councils and Lismore City Council, Boorowa Shire Council and Tenterfield Shire Council being used as rural guinea pigs.

Business groups have long called for councils to improve their act in terms of cutting red tape and regulation.

Late last year the chief executive of the Council of Small Business Australia (COSBOA), Peter Strong, took aim at the local government sector for being “arrogant and dismissive”.

Mr Strong said the local government sector was often creating problems, including delays in development approvals costing small businesses money or even forcing them to close. Mr Strong also cited bad behaviour when by council employees when entering business premises and the length of time taken to answer calls and the complex licencing arrangements.

Those criticisms appear to have had some effect. The NSW Business Chamber warmly welcomed the effort by the state government and chief executive Stephen Cartwright said the initiative was about getting councils to be a “helpful partner” to their small business communities, “rather than a hindrance”.

“Councils have frequently topped the NSW Business Chamber’s annual Red Tape Survey as generating the biggest red tape burden for small businesses – beating even the Australian Tax Office!” Mr Cartwright said.

He said councils have an important role to play in supporting the success and growth of small businesses but there is a disjointed experience for NSW Business Chamber members depending on which council area they are located.

“The NSW Business Chamber has had firsthand experience of the how councils can vary in their approach to regulation during the Chamber’s recent tour of NSW with the Southern Hemisphere’s largest mobile billboard, the SkyBoard,” Mr Cartwright said.

He said the Chamber visited over 60 locations and had responses from councils that demonstrated a wide range of requirements to approve the same activity – “from ‘send me an email’ to ‘submit a full DA’”.

Minister for Local Government Don Page also approved of the scheme, saying that the pilot will run for approximately a year and that he hopes that it will be rolled out to all councils in NSW.