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Speaker 1: We've got some evidence of bad spending by the Ministry

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Speaker 1: of Social Development and OIA by the Taxpayers Union has

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Speaker 1: revealed the government spent over thirty eight million dollars on

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Speaker 1: business startup grants and they gave them to beneficiaries. However,

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Speaker 1: the Ministry doesn't track the performance of the businesses to

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Speaker 1: see how they do once we give them the handout,

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Speaker 1: and the real kicker, hundreds of those given the grants

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Speaker 1: we're back on the benefit within two years. To talk

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Speaker 1: about this, I'm joined by Phil Wicks, who is the

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Speaker 1: Small Business New Zealand founder.

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Speaker 2: Morning to you, Phil, Good morning, here are you?

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Speaker 1: I'm good? Is this bad fund management? George just playing stupidity?

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Speaker 2: Well, I'll also entrepreneurship. You know, it's being my life

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Speaker 2: up with small business own. It's both. Starting business is hard.

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Speaker 2: It's not a quick fix rund employment. If I was

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Speaker 2: going to use taxpayers made to help people into business

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Speaker 2: has to be more than just writing checks and wishing

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Speaker 2: them a good wishing.

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Speaker 1: Them good luck, patting on the back and go go

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Speaker 1: to it. I don't want to be rude, but the

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Speaker 1: guys that they've given us thirty eight million dollars to

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Speaker 1: are already unemployed and there may be a reason for that.

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Speaker 2: Yeah, Australian business is not a social service. It's a

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Speaker 2: high risk commercial decision. You need skills, planning, support, resilience,

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Speaker 2: not just a lumplification as you see to put on

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Speaker 2: the back. Now often people on these schemes of the

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Speaker 2: furthest from the labor market. I guess it doesn't mean

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Speaker 2: I can't succeed, you know, And I said, I'm all

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Speaker 2: for entrepreneurship, but it does mean they need more structure,

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Speaker 2: more mentoring, and clearer expectations, not less and you got

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Speaker 2: a proper recourse on what happens as well.

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Speaker 1: You could say we have tracked this because we've found

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Speaker 1: out that hundreds of the people who got these grants

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Speaker 1: we're back on the benefit within two years, So we

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Speaker 1: can assume that the business has failed. And so we

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Speaker 1: can assume, you know, the whole program did not work.

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Speaker 1: So we should just stop it, shouldn't we?

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Speaker 2: Yes? I would think so. If you take somebody who's

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Speaker 2: been on a benefit for a long time and government

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Speaker 2: grant child them a business owner, but you don't wrap

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Speaker 2: proper support around them, you're almost you're almost setting them

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Speaker 2: up to fail and sending them straight back into straight

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Speaker 2: back into a benefit.

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Speaker 1: How should we spend thirty eight million dollars in a

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Speaker 1: better way?

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Speaker 2: Well, there are schemes, you know, there are some very

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Speaker 2: good government schemes. The Capability of Vout scheme for one,

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Speaker 2: which is it's a small you know, I think it's

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Speaker 2: a very underfunded scheme, but it's very well run. It's

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Speaker 2: run very well by the regional business partners. There's a

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Speaker 2: good structure around it, and an office of generally offers

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Speaker 2: a very good return on investment. You know, business owners

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Speaker 2: get up to it's fifty fifty funding, they get up

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Speaker 2: to five thousand dollars. But you can trace back and

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Speaker 2: we've done that with our own clients that have benefited

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Speaker 2: from that scheme. I think about a year ago, had

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Speaker 2: to look at everybody that had been throughout with ours,

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Speaker 2: and you know, we could measure that on average they

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Speaker 2: over a long term they've got about I think it

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Speaker 2: was about one hundred and eleven percent growth. Now that's

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Speaker 2: you know, that's a return on investment that's well run.

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Speaker 2: You can measure it, and you know that those businesses

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Speaker 2: that succeed off of more into the economy, there's more

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Speaker 2: tax that they're paying, there's more people that they employed.

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Speaker 2: So that's an example of a of a really well

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Speaker 2: run scheme. But there's a lot of Like I said,

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Speaker 2: there's a lot of support support around there. You know,

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Speaker 2: if you're going to do anything like this, you must

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Speaker 2: make the money conditional on masked milestones, you know, finishing

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Speaker 2: a business plan, complete training show, some actual customers, hit

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Speaker 2: some revenue, few targets. Yeah, yeah, Well that's how investors

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Speaker 2: work in the real world.

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Speaker 1: Isn't exactly right? Execu rate phil works. I thank you

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Speaker 1: for your time, Small Business New Zealand founder. For more

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