The Australian Small Business and Family Enterprise Ombudsman, Kate Carnell today welcomed Labor's commitment to establish a free legal advice service for small businesses and farmers in dispute with financial service providers.
"Through this initiative, small businesses and farmers would get free legal advice as soon as a dispute arises," Ms Carnell said.
"This service would continue to provide legal advice if the dispute is escalated to Australian Financial Complaints Authority (AFCA) or is taken to court.
"Small businesses and farmers would also be able to call on this advice to prepare for past cases to be considered by AFCA under its extended remit - to consider eligible financial complaints from small businesses dating back to 1 January 2008.
"We support measures that ensure small businesses have access to justice, particularly in cases where there's an imbalance of bargaining power.
"The court system is expensive and is extremely time-consuming; money and time are two key things that small business owners don't have.
"Phase I of our Access to Justice Inquiry found three out of five small business owners sought legal advice from a lawyer. Even with legal advice, small businesses find the cost of any action to achieve justice outweighs the potential gain.
"The proposed initiative would have the ability to actually fund cases, which is a real step to achieving justice for small businesses and farmers with valid cases against their financial service providers."
