ASIC report shows Small Business Restructure appointments surged from 82 initially to over 1,400 in 2023-24, with 87% success rate.
Australian small businesses are finding renewed hope through the Small Business Restructure (SBR) process, with new ASIC data confirming what industry experts have been witnessing firsthand – this framework is delivering real results for companies facing financial distress.
Introduced in 2021 as a response to the COVID-19 pandemic’s devastating impact on Australian businesses, the SBR process was designed to help companies bounce back without losing control of their operations. According to the Government’s official framework, the process allows “financially distressed small businesses to access a single, streamlined process to restructure their debts, while allowing the owners to remain in control of their business.”
Dramatic growth and success rates
The numbers tell a compelling story of increasing trust and success. ASIC’s recent report shows SBR appointments have surged from just 82 in the first 18 months of operation to over 1,400 in 2023-24, with projections suggesting over 3,000 appointments for 2024-25. The construction and hospitality industries account for half of all SBR appointments, according to the ASIC report, highlighting the sectors most severely impacted by recent economic conditions and the ongoing cost-of-living crisis.
The ASIC report delivers encouraging statistics about the SBR process’s effectiveness: 87% of all SBR plans were successful, with creditors accepting the proposed restructuring arrangements, and 93% of companies that completed an SBR plan by March 31, 2025, remained registered as of April 30, 2025. These figures demonstrate that the SBR process is not just providing temporary relief but enabling genuine business recovery and long-term viability.
Grant Thornton’s Restructuring Advisory team has been at the forefront of implementing successful SBR processes for clients across various industries. John McInerney, Partner – Restructuring Advisory at Grant Thornton, shares a compelling example: “We’ve had a run of success helping clients restructure and keep their businesses running. One hospitality client was downsized from four cafés to three after the COVID period. By taking them through the SBR, we saved 70 jobs, restructured legacy debt, and now they have expanded and have six cafés highlighting the benefits of the SBR process.”
How the Framework Operates
The framework is specifically designed for incorporated companies with total liabilities not exceeding $1 million, according to the Government’s official documentation, excluding employee entitlements from this threshold. The Government framework recognizes that businesses may need time to find a practitioner, providing “up to an extra three months to access a practitioner from the day you declare your intention to access the restructuring process.”
One of the SBR process’s most attractive features is that directors remain in control during the restructuring. Unlike traditional administration processes where external administrators take over business operations, the SBR framework allows existing management to continue running the business while working collaboratively with restructuring practitioners. The framework includes a moratorium on creditor actions during the process, meaning “unsecured creditors cannot begin, continue or enforce their claims” while the restructuring is underway, according to the official documentation.
Companies must present their debt restructuring plan to creditors within 20 business days of entering the process, with creditors having 15 business days to vote, according to the Government framework. A plan is accepted if more than 50% of creditors by value vote in favor, with related party creditors excluded from voting to ensure integrity.
Professional Standards and Employee Protection
The framework prioritizes employee protection, requiring that “employee entitlements which are due and payable have been paid” before creditors can vote on a restructuring plan, according to the official documentation. Employee entitlements are excluded from the restructuring plan itself, providing additional security for workers. The Government framework also specifically requires that “all relevant tax returns and activity statements are lodged with the ATO” before a plan can be put to creditors.
The Government framework ensures quality control by requiring that small business restructuring practitioners must be Registered Liquidators with suitable experience and knowledge. To provide cost certainty, the framework mandates that practitioners “must offer a flat fee to assist you to prepare the restructuring plan and to put the plan to creditors.” Once a plan is accepted, practitioners are paid as a percentage of disbursements to creditors, with creditors required to consent to this remuneration structure when voting.
McInerney emphasizes the collaborative nature of the process: “We continue to advocate for practical, forward-looking solutions that help Australian small (and some medium) businesses navigate financial distress and emerge stronger.” The success of the SBR process represents more than just effective policy implementation; it demonstrates the resilience of Australian small businesses and their capacity to adapt and recover when provided with appropriate support mechanisms. The combination of strong success rates shown in the ASIC report, growing adoption, and real-world examples like Grant Thornton’s café client transformation positions the Small Business Restructure process as a genuine success story in Australian business support policy.
To explore your business’s eligibility for a SBR, read more here.
Read for more information about the SBR process, and listen to a SBR podcast from Grant Thornton.
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