The Australian Small Business and Family Enterprise Ombudsman, Kate Carnell, today welcomed Labor's announcement to boost investment in local small to medium enterprises (SMEs) by ensuring they get a better share of government contracts.

"This is great news for the small business sector, considering the percentage of government procurement by SMEs has declined over the past four years," Ms Carnell said.

"Small businesses tell us every day they don't want handouts; they want work. A commitment by the Labor Party to ensure that SMEs get their fair share of work is a step in the right direction.

"The dilemma is all sides of politics have committed to this, but it hasn't happened.

"The challenge for Labor is to have a target of real work for SMEs, not just paperclips and catering.

"It's important that government work allows SMEs to innovate and grow their business.

"The experience to date is that unless governments regularly audit contracts to ensure large companies and multinationals have delivered on their promise to engage small business, it regularly doesn't happen.

"The other issue that needs addressing is to ensure big businesses don't 'screw' SMEs in the supply chain by reducing the amount paid to small businesses and lengthening payment times. We see this all the time.

"We support the requirements in the Plan for Local Jobs, particularly local labour-market testing and the on-the-ground contact for engagement with SMEs.

"We also welcome efforts to increase apprenticeships and traineeships so SMEs have access to well-trained people in their local communities to grow their businesses.

"SMEs are the engine room of Australia's economy; where jobs are created and we are pleased to see Labor recognising this."