The business community has responded with cautious optimism following the Coalition’s dramatic election win, but warned that there is much to do in order to shore up confidence and growth.
Much of the Coalition’s election campaigning revolved around its April budget, which made a number of promises to the business community.
While many commentators congratulated the government on its surprise return to power, all urged against the government resting on its laurels and not delivering for SMEs and for the country as a whole.
‘Put the national interest first’
After years of leadership instability in Canberra under both Coalition and Labor governments, Yasser El-Ansary, the Australian Investment Council’s CEO, called on all sides of politics to “put the national interest first in all decisions made in the new 46th Parliament”.
“It is vitally important for the Australian economy that there is stability and certainty in our parliamentary process,” he said.
Mr El-Ansary said that business surveys have pointed to below-average confidence among the country’s business community, and that restoring this confidence should be a major focus for the government.
“In the global competition for capital and talent, we can’t afford to waste any opportunity to improve market conditions that support investment into areas like research and development or productive capacity, the upskilling of employees or attracting overseas talent,” he said.
As such, he renewed the Council’s push for ongoing government support for the R&D tax incentive, greater support for high-growth Australian businesses and industry-backed reforms to boost the attractiveness of Australian enterprises to foreign investors.
Address taxes, soaring energy costs
James Pearson, head of the Australian Chamber of Commerce and Industry, said that it was “reassuring” to hear both Prime Minister Scott Morrison and outgoing Opposition Leader Bill Shorten both acknowledge “the importance of governing for all Australians” after such a “hard-fought contest”.
And he suggested that SMEs were largely united in the issues they are looking on the government to address.
“Australia’s small businesses told us that better workplace relations, lower power prices and better investment in skills are important issues for them,” Mr Pearson said.
“The returning government recognises the importance of small business. Small businesses employ 5 million people, give jobs to a third of young people in the workforce, and train and employ 40 per cent of apprentices. They need policies that will support them and the millions of people that depend on them.
“We want to work with the government and the parliament to make Australia the best place in the world to do business [so that] Australians can have the jobs, living standards and opportunities to which they aspire.”
Meanwhile, MYOB CEO Tim Reed said that surveys of its customer base point to taxes, energy costs and the instant asset-write off as the issues to which the government should turn its attention if it is to deliver for SMEs.
“The issues that small business owners want an incoming government to take action on are clear. They told us that a lower tax rate allows them to re-invest in their business, that utility costs are rising to crippling levels, that they value the instant asset write-off and want access to e-invoicing,” he said.
“They also want the government to simplify — removing red tape, streamlining the BAS and GST reporting processes and increasing their digital service offering.”
He urged the government to “ensure that the interests of small business owners across Australia are front and centre to a re-elected Coalition government’s decision-making”.
Honour commitment to tackling late payments
The founder and CEO of Australian fintech Earlytrade, Guy Saxelby, homed in on the issue of late payments, and urged the Coalition to honour its promise to pay SME invoices within 20 days and force other companies tendering for government contracts to do the same.
“Australia is one of the latest-paying countries in the world,” he said.
“The Coalition has begun addressing this issue, and reducing payment times to small business has been front and centre of its small business agenda this year. They’ve proposed to help small business cash flow by mandating that government pay its bills within 20 days for contracts up to $1 million. Large businesses seeking government contracts will also be required to do the same.
“Further, the Coalition has pushed forward with a range of initiatives including an annual payments reporting framework for large organisations (over $100 million revenue), which is a positive step towards greater transparency.”
According to Mr Saxelby, such stirrings by the federal government are mounting pressure on corporate Australia to “do the right thing in regards to small business payments”, but that meaningful change on the issue will not happen on its own.
“More needs to be done to improve corporate-supplier relationships and eliminate late payments to small business,” he said.
“Ultimately, a solution to late payments will come from a combination of government and market-based initiatives.”
In late January, One Nation unveiled a policy that would see payment terms mandated under law for businesses, and the introduction of penalties on large companies that failed to pay on time.
“Small and medium-sized businesses should not be used as a cheap source of finance through extended or late payment terms,” it said in a statement.
‘Cost of climate inaction far worse than acting’
Climate change was another key issue in this election. According to Professor Jamek Ratnatunga, head of the Institute of Certified Management Accountants, the time has long passed for debating whether action is needed.
“[The] cost of not acting on climate change is far worse than acting on climate change,” he said, noting the recent declaration by Britain’s parliament that climate change is now a national emergency, effectively putting it on a “war footing”.
“Just get on with it.”
However, Professor Ratnatunga disputed some of the claims around the economic cost of taking action on the environment, pointing out that it is not possible to calculate such costs with any degree of accuracy, and that any modelling done on potential costs ultimately depends on who is paying to conduct the modelling.
He also said that the opposite of doing nothing — completely forgetting economic cost models and galvanising immediate action — could also have serious consequences, as this can “border on extremism and civil disobedience”.
‘Work with us on regulation’
“It’s imperative that industry, government and research institutes collaborate closely to foster a vibrant and innovative digital and technology sector, supported by a regulatory framework that encourages the economic growth, productivity and sustainability of our nation,” head of the Australian Information Industry Association, Ron Gauci, said in congratulating the government.
As a first port of call, he urged the government to pass amendments to the Assistance and Access Act to provide greater certainty to both the technology sector, but also to all users of encrypted services.
“The AIIA has made significant contributions and recommendations with respect to these amendments, but has yet to see the recommendations considered or adopted, leaving industry unclear on the operational requirements.”
He also said the technology and information industry is looking forward to the promised $2.8 billion annual commitment to improving skills training and education, and the establishment of a National Skills Commission to oversee this investment.
“Some of our members have successfully led and are rolling out alternative pathways to developing digital skills in schoolchildren. These programs have seen collaboration between government departments, universities, research institutes and industry,” he said.
“[They] would be delighted to share their success stories and learnings from these programs with the new government to further provide the crucial evidence of the success of these initiatives.”
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.