The Tasmanian Small Business Council says the government should again top up funding for its small business hardship grant program but Premier Peter Gutwein has rejected the idea.
Mr Gutwein said there was a finite amount of money for the program.
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"In terms of the program that we initially outlined, that was a $40 million program. We increased that by 50 per cent to $60 million," Mr Gutwein said.
"Unfortunately there will be some businesses that will miss out.
"The decisions [to award the grants] were made by a panel within the Department, and Ministers and the government had no involvement in those decisions."
Mr Gutwein said the government had committed to reviewing the program and he expected Small Business Minister Sarah Courtney would be able to provide an update on this soon.
TSBC chief executive Robert Mallett said he had been contacted by businesses which were "pissed off" they had been knocked back for the grant.
"They had applied for the $15,000 grant and were only offered $4000. They were very upset," he said.
"There have been businesses every reasonable person would imagine were eligible but were told they weren't eligible and given a consolation prize."
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Mr Mallett said the government needed to invest more money in this package and further support measures needed to be targeted toward industry sectors such as tourism and hospitality which continued to be severely impacted as the result of government decisions.
"When you make a mistake you've got to pay for it. They made a mistake in the way they advertised [the program] and as a result left some people reasonably expecting they would be eligible for this who were well and truly let down," he said.
Labor leader Rebecca White said it was clear the program was oversubscribed.
Ms White said her party had been inundated with complaints for businesses which had failed to receive support despite suffering from the impact of COVID-19 restrictions.
"The government misunderstood the level of pain in the community and the number of businesses that were doing it tough," she said.
"Some businesses have missed out on crucial support without which they may not survive."
Ms White said the government needed to explain why businesses which were clearly eligible did not receive any support.