Budget lacks strong direction: Hewson

Former Liberal leader John Hewson has questioned the Abbott government's slogan of being "open for business".

Opening a conference in Melbourne, Dr Hewson criticised the May budget for lacking a strong overall policy direction for the country.

He warned the National Small Business Summit that small businesses faced a tough time in the next 18 months and the community should be concerned about what would sustain Australia's economy past the mining boom.

While small firms are the nation's largest employers, they face major difficulties, such as securing loans and dealing with business interest rates that are still to high compared with where the official interest rate sits.

"We've also lost a massive opportunity to build a lot of new businesses in response to climate change with the rescinding of the carbon tax," Dr Hewson said.

"We keep getting told we are open for business, but what business? Where is the growth going to come from after the mining boom?"

However, he believes the government has a unique opportunity to make a difference to small businesses through tax reform.

He said it was time to have a mature debate about structural tax reform to ensure equity and longevity in the taxation system.