Cash-strapped businesses dob in government department over the mishandling of business grants

Cash-strapped Victorian small business owners have lodged hundreds of complaints over a support fund they will have to pay back.

Exclusive: Battling business owners are being forced to take out loans to repay tens of thousands of dollars in COVID-19 grants they’ve been wrongly paid.

The grants – supposed to provide a lifeline – have instead delivered a financial nightmare because of government bungling.

More than 1100 business owners across Victoria have now lodged complaints about the government’s multi-billion Business Support Fund.

Wild Dog Winery owners Gary Surman, 77, and wife Judy, 76, from Warragul, received a $30,000 government grant in December but then were ordered to pay back $25,000 by last Tuesday.

They were told they should have never received the funds.

Mr Surman said they reported the matter to the ombudsman and will have to take out a loan if they do have to pay it back.

“All of our businesses have been under financial and mental stress with the pandemic, we received the grant before Christmas and we used it to rebrand and make adjustments to our business,” he said.

“We’ll have to extend our loan to pay the money back.”

Wild Dog Winery owners Gary Surman and wife Judy have been ordered to pay back $25,000 of $30,000 in government grants they received from the state government during the pandemic. Picture: Jake Nowakowski.

Many business owners have complained about lengthy delays and failure of communication by the Department of Jobs, Precincts and Regions.

It comes amid more issues with business grants that were given to thousands of smaller operators across the state – nearly 300 businesses have been forced to pay back the grants they were told they were incorrectly given.

Some operators say this may send them broke.

South Gippsland cooking school owner Jaci Hicken runs Jacican and recently received an email from the government that said she had incorrectly received a $20,000 grant and would have to repay the money.

She has also lodged a complaint with the ombudsman.

“I want to know if I did anything wrong and have to change my business practices or was it an administrative fault,” Ms Hicken from Mirboo North said.

The grants are typically between $10,000 and $20,000.

Cooking school owner Jaci Hicken is taking her matter to the small business ombudsman. Picture: Supplied

Victorian ombudsman Deborah Glass said distressed business owners who have had difficulty dealing with government support measures should contact her office.

“Our systematic investigation into how the Department of Jobs, Precincts and Regions has dealt with grant applications is ongoing, while individual complaints to my office are being resolved wherever possible on a case-by-case basis,” she said.

“If business owners have experienced issues with the Business Support Fund and remain unhappy with the department’s response I urge them to get in contact with my office.”

Shadow Minister for Finance Matthew Guy said many businesses had been badly hit during the pandemic and had failed to receive sufficient support.

“This government's unnecessary third lockdown has crippled small business and they can’t even offer them a proper level of compensation,” he said.

“There's no doubt there’ll be more complaints because this government does not set up support to help small businesses, it seems intent on destroying small businesses unless they are a unionised workforce or have more than 1000 employees.”

A government said the support fund has provided $2.6 billion to more than 134,000 individual businesses and has worked closely with the Ombudsman “to resolve complaints”.

Once the investigation is completed a report will be tabled in parliament.

@sophieelsworth

Originally published as Cash-strapped businesses dob in government department over the mishandling of business grants