A COFFS Coast resident who was forced to close his business in the wake of the Rudd government's failed "pink batts" home insulation scheme has welcomed news that compensation is now available.
Urunga resident Uwe Ledermann was one of about 5000 Australian business owners who signed-up to the $2.7 billion home insulation scheme in 2009.
It formed part of the Labour Government's response to the global financial crisis.
The scheme saw an influx of new insulation companies on the Coffs Coast - keen to take advantage of the government's financial package.
Mr Ledermann had to spend thousands of dollars upsizing his business, Midcoast Insulation, to remain competitive in the flooded market.
"Before the scheme launched we were one of three businesses on the Coffs Coast in the insulation field but that number quickly increased - the scheme was open to anyone who had an ABN number," he said.
When the scheme suddenly closed in early 2010, a majority of the new insulation companies left the Coffs Coast as demand plummeted.
Mr Ledermann was left with thousands of dollars in stock and new equipment that needed to be paid for.
"The scheme was supposed to run for three years, but it ended up lasting only nine months," he said.
"We were saddled with leases on vehicles, stores and facilities that were no longer needed - there was no fore-warning of the (scheme's) closure at all."
Despite efforts to remain afloat, Midcoast Insulation was entered into liquidation at the end of 2011.
Mr Ledermann welcomed Minister for Industry Ian Macfarlane's announcement this week that compensation was available.
Member for Cowper Luke Hartsuyker said a number of other local businesses had suffered because of the failed scheme.
"Some businesses were left with tens of thousands of dollars in stock which was rendered almost worthless," Mr Hartsuyker said.
"It's right and just that affected businesses are able to apply for compensation for the loss and damage caused by this program."
To be eligible for compensation, companies must be pre-existing home insulation installation businesses prior to February 3, 2009.
Businesses that breached the Home Insulation Program guidelines will be ineligible for a payment.
Every business seeking compensation will be able to discuss their applications with QC Ian Hanger, who conducted the Hanger Royal Commission into the scheme.
How much each business gets will be decided by accounting firm Deloitte.