Former Liberal leader Will Hodgman resigned as Tasmanian premier in January after serving as leader of Tasmania for six years. He was elected a member of the Tasmanian Parliament in 2002 after working in the law.
Federal Treasurer Josh Frydenberg has now announced that Mr Hodgman will be the first chair of the Australian Business Growth Fund (BGF), despite the fact that the legislation to establish the fund has not yet passed Parliament.
Mr Frydenberg said the BGF will play an important role in supporting the recovery of the economy in the wake of the coronavirus pandemic.
“Given the impact of the coronavirus on the Australian economy, the BGF will play an important role in supporting the recovery and investing in Australian businesses to create jobs and increase productivity,” the Treasurer said.
HSBC and Macquarie Group will each contribute $20 million to the fund.
NAB chief customer officer, business and private bank, Anthony Healy welcomed Mr Hodgman’s appointment.
“I’ve been consistently impressed with Will’s passion for supporting small business, and we are confident that he will provide the strong leadership required for the fund to be successful,” Mr Healy said.
“The establishment of this critical fund will help provide a vital boost to small and medium businesses in Australia at a time when these companies need our support more than ever before.”
Established Australian businesses will be eligible for long-term equity capital investments of between $5 million and $15 million, where they have generated annual revenue between $2 million and $100 million, and can demonstrate three years of revenue growth and profitability.
The BGF’s investment stake will be between 10 and 40 per cent, allowing small-business owners to maintain control. The funding will be provided over a five-year period.
“The BGF will ensure that SMEs have access to the capital they need to grow, fulfil their potential and continue to underpin Australian economic growth and employment,” Mr Frydenberg said.
The legislation received bipartisan support in the lower house but not before the passage of the Australian Business Growth Fund Bill (2019) was delayed after opposition MPs voted to send the bill to the economics legislation committee for further inquiry.
Opposition MPs expressed concern regarding the length of the consultation process, which ran for just four days, from 4 November to 8 November 2019.
The bill now sits in the Senate and is expected to pass once Parliament resumes sitting.
Labor moved an amendment to the legislation, which called for a review of the BGF, which she said must include the effectiveness of the act in meeting its objectives. The review must be undertaken three years after commencement of the fund.
Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.
Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.