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Phil Wicks: Small Business New Zealand Founder on the Government's business start up grant · Early Edition with Ryan Bridge

• 0:00
  Speaker 1: We've got some evidence of bad spending by the Ministry
• 0:02
  Speaker 1: of Social Development and OIA by the Taxpayers Union has
• 0:06
  Speaker 1: revealed the government spent over thirty eight million dollars on
• 0:09
  Speaker 1: business startup grants and they gave them to beneficiaries. However,
• 0:14
  Speaker 1: the Ministry doesn't track the performance of the businesses to
• 0:17
  Speaker 1: see how they do once we give them the handout,
• 0:19
  Speaker 1: and the real kicker, hundreds of those given the grants
• 0:22
  Speaker 1: we're back on the benefit within two years. To talk
• 0:24
  Speaker 1: about this, I'm joined by Phil Wicks, who is the
• 0:27
  Speaker 1: Small Business New Zealand founder.
• 0:28
  Speaker 2: Morning to you, Phil, Good morning, here are you?
• 0:31
  Speaker 1: I'm good? Is this bad fund management? George just playing stupidity?
• 0:36
  Speaker 2: Well, I'll also entrepreneurship. You know, it's being my life
• 0:39
  Speaker 2: up with small business own. It's both. Starting business is hard.
• 0:42
  Speaker 2: It's not a quick fix rund employment. If I was
• 0:44
  Speaker 2: going to use taxpayers made to help people into business
• 0:48
  Speaker 2: has to be more than just writing checks and wishing
• 0:51
  Speaker 2: them a good wishing.
• 0:52
  Speaker 1: Them good luck, patting on the back and go go
• 0:54
  Speaker 1: to it. I don't want to be rude, but the
• 0:56
  Speaker 1: guys that they've given us thirty eight million dollars to
• 0:58
  Speaker 1: are already unemployed and there may be a reason for that.
• 1:02
  Speaker 2: Yeah, Australian business is not a social service. It's a
• 1:05
  Speaker 2: high risk commercial decision. You need skills, planning, support, resilience,
• 1:10
  Speaker 2: not just a lumplification as you see to put on
• 1:13
  Speaker 2: the back. Now often people on these schemes of the
• 1:15
  Speaker 2: furthest from the labor market. I guess it doesn't mean
• 1:19
  Speaker 2: I can't succeed, you know, And I said, I'm all
• 1:22
  Speaker 2: for entrepreneurship, but it does mean they need more structure,
• 1:26
  Speaker 2: more mentoring, and clearer expectations, not less and you got
• 1:30
  Speaker 2: a proper recourse on what happens as well.
• 1:33
  Speaker 1: You could say we have tracked this because we've found
• 1:35
  Speaker 1: out that hundreds of the people who got these grants
• 1:38
  Speaker 1: we're back on the benefit within two years, So we
• 1:41
  Speaker 1: can assume that the business has failed. And so we
• 1:43
  Speaker 1: can assume, you know, the whole program did not work.
• 1:46
  Speaker 1: So we should just stop it, shouldn't we?
• 1:50
  Speaker 2: Yes? I would think so. If you take somebody who's
• 1:52
  Speaker 2: been on a benefit for a long time and government
• 1:54
  Speaker 2: grant child them a business owner, but you don't wrap
• 1:58
  Speaker 2: proper support around them, you're almost you're almost setting them
• 2:02
  Speaker 2: up to fail and sending them straight back into straight
• 2:05
  Speaker 2: back into a benefit.
• 2:07
  Speaker 1: How should we spend thirty eight million dollars in a
• 2:09
  Speaker 1: better way?
• 2:11
  Speaker 2: Well, there are schemes, you know, there are some very
• 2:15
  Speaker 2: good government schemes. The Capability of Vout scheme for one,
• 2:18
  Speaker 2: which is it's a small you know, I think it's
• 2:20
  Speaker 2: a very underfunded scheme, but it's very well run. It's
• 2:24
  Speaker 2: run very well by the regional business partners. There's a
• 2:28
  Speaker 2: good structure around it, and an office of generally offers
• 2:33
  Speaker 2: a very good return on investment. You know, business owners
• 2:36
  Speaker 2: get up to it's fifty fifty funding, they get up
• 2:39
  Speaker 2: to five thousand dollars. But you can trace back and
• 2:43
  Speaker 2: we've done that with our own clients that have benefited
• 2:46
  Speaker 2: from that scheme. I think about a year ago, had
• 2:48
  Speaker 2: to look at everybody that had been throughout with ours,
• 2:52
  Speaker 2: and you know, we could measure that on average they
• 2:54
  Speaker 2: over a long term they've got about I think it
• 2:56
  Speaker 2: was about one hundred and eleven percent growth. Now that's
• 2:59
  Speaker 2: you know, that's a return on investment that's well run.
• 3:01
  Speaker 2: You can measure it, and you know that those businesses
• 3:06
  Speaker 2: that succeed off of more into the economy, there's more
• 3:09
  Speaker 2: tax that they're paying, there's more people that they employed.
• 3:11
  Speaker 2: So that's an example of a of a really well
• 3:13
  Speaker 2: run scheme. But there's a lot of Like I said,
• 3:16
  Speaker 2: there's a lot of support support around there. You know,
• 3:19
  Speaker 2: if you're going to do anything like this, you must
• 3:21
  Speaker 2: make the money conditional on masked milestones, you know, finishing
• 3:26
  Speaker 2: a business plan, complete training show, some actual customers, hit
• 3:29
  Speaker 2: some revenue, few targets. Yeah, yeah, Well that's how investors
• 3:33
  Speaker 2: work in the real world.
• 3:34
  Speaker 1: Isn't exactly right? Execu rate phil works. I thank you
• 3:36
  Speaker 1: for your time, Small Business New Zealand founder. For more
• 3:39
  Speaker 1: from Early Edition with Ryan Bridge, listen live to News
• 3:42
  Speaker 1: Talks it Be from five am weekdays, or follow the
• 3:45
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