BCA Chief Executive Bran Black Doorstop at Parliament House, Canberra
04 February 2025
Event: Doorstop at Parliament House, Canberra
Speakers: Business Council of Australia Chief Executive Bran Black
Date: 4 February 2025
Topics: Big Five Questions, small business, tariffs
E&OE
Bran Black, Business Council Chief Executive: It’s what we describe as our Big Five document. What we're saying is that Australia is a wonderful place, but we face many challenges right now, and we need clear policy solutions to those challenges. We know that we've got productivity that isn’t where it needs to be. Productivity is negative 0.8 per cent in its long run average ...
We know that real wages have gone backwards since December of 2022. We know that we have a housing crisis and that we are experiencing real challenges to deliver on the Government's target of 1.2 million homes within five years. We know that we have a challenge in terms of securing all the business investment that's necessary for the certainty that's required to deliver net zero by 2050.
We know that we've got challenges in terms of skills, with one in three occupations reporting a lack of skills, and of course, we've got the intergenerational challenge of continuing to deliver sustainable healthcare.
In that context, we're putting forward real solutions to these challenges. We're proposing solutions with respect to savings within government, or deregulation, for how we can go about ensuring we have a proper conversation around our tax mix.
Underpinning all of this, underpinning everything, is the role of the private sector for that critical question we've identified first as how do we ease cost-of-living. The best thing we can do is drive productivity. Productivity is ultimately the best determinant of real wages growth. And it's real wages growth that underpins our capacity to give people more money the end of the week, after they've paid their bills, after they've paid their mortgage or their rent or paid for their kids school fees.
That's what we're trying to shoot for and if we can deliver real wages growth by enhancing productivity, the answer for that is unquestionably, making sure we support businesses to be the best that they can be.
As I said, that means focusing on deregulation, workplace settings and tax settings and so forth. So, we agree with the Treasurer. He said that he wants to see a private sector recovery. We think that this Big Five document that we're launching today affords us a strong basis for doing that.
Very happy to take any questions.
Journalist: On the Coalition's plan for a tax break for work lunches. Is that something that industry or business owners calling for. What are your thoughts on that?
Bran: Well, I think that we have, firstly, let me say that the number one thing that we can do with respect to tax is look at the tax system holistically. And so, what that means is looking at all the different tax regimes that are on the table. So personal taxes, company taxes, state-based taxes, consumption taxes. The best thing that we can do is look at them holistically, rather than on a piecemeal basis.
We know that we need to find ways of delivering a greater size of the pie, if I can put it that way, and the way we do that is by bringing more investment. To get that investment, we need those more competitive settings.
But directly to that question, we do support our colleagues at COSBOA who argue for this measure, and they've done that because they see this as a useful basis for supporting small business.
Journalist: Aren't there more effective ways to use that money, though. If the government's going to sacrifice revenue for lunches for business, wouldn't it be better off putting that money into something that's more productive? It all comes down to a cost to taxpayers. Isn't that a relatively inefficient way of spending taxpayer money?
Bran: I think the key thing that we’ve got to focus on, certainly in terms of any type of tax measure, is that we do want to see what it looks like from a productivity-enhancing perspective.
What we would stress, as I mentioned before, we support this measure from a small business perspective, we do back our colleagues, because they've identified this as a measure which they regard as being important. But we do think it's important with any expenditure that is proposed with respect to federal money, to go through that productivity assessment process.
And I would say one of the measures that we focused on in this document is a genuine productivity assessment of any proposed regulation. We think that's a good basis for any proposed government expenditure.
Journalist: On your calls for a Minister for Deregulation, the Treasurer was saying that that role is already being done by the Finance Department and the Finance Minister through that job. And he said that he didn't agree with creating another Minister because he said it was a bit of a strange idea to create another department to reduce complexity in regulation. What do you make of that?
Bran: Well, I think the key thing about having a Minister for Deregulation is that you are bringing real focus to the task. You are making it absolutely clear that a focus for the government, or any government, is going to be deregulation.
Now we think that that's absolutely critical. We’re seeing right around the world that other countries are increasingly focused on how they can reduce the regulatory impact on business. We think we need to be doing the same thing.
Now I don't just say that because being competitive is good for the sake of being competitive. It's because if other countries are more competitive than us, then they've got a better basis for securing the investment that we might otherwise secure. And I consistently hear from my members and from businesses around the country that we are not as competitive a place to do business as we used to be.
So, if we can find things, i.e. through reducing regulation and having that strong focus that comes with a Minister, if we can find things by cutting red tape, then we should absolutely do.
Journalist: The Government has announced its small business strategy yesterday to not much fanfare and its focus is clearing up where people can go to get support. Does that suggest that the Government is open to cutting red tape and making it a clearer process for investors. Do you feel that that's a step in the right direction?
Bran: I think any support that we can provide in terms of giving people more access to information or affording better pathways, newer pathways for people to access supports, or even just information about what those supports might be is really very useful.
We do think on both sides of politics, there is a receptiveness to points that we're pushing in terms of this importance of deregulation. We hear that in the conversations that we have with Government. We hear that in terms of conversations that we have with the Opposition as well.
Fundamentally, as I was saying, we know that other countries are focusing on their competitive settings, and it's incumbent upon us doing the same thing. We’re intent on bringing investment here.
Journalist: Can you tell us how Australian businesses are feeling today about the flow on effect of what would then be from US trade tariffs on Mexico, Canada and China and are you concerned that Australia could be subject to tariffs?
Bran: Well, I think we do need to plan for any potential scenario in terms of tariffs. It would be imprudent for us to do otherwise. I was in Washington in the latter part of last year, and the message there is very important, and that was that Australia has always been a reliably dependable ally and a great friend of the United States. And that is something that stands in our favour in terms of the potential imposition of tariffs on Australia.
We do need to remember, of course, that we have a trade deficit to the United States. I think the two-way trade figures are about 100 billion all up. 65 per cent of that is from the US to Australia. That's another factor that stands in our favour in terms of not having tariffs applied here.
What we need to remember, however, is that we can't take that for granted, so we need to be working hard to ensure that those in Washington who are ultimately responsible for these matters understand why Australia should not be the subject of those types of tariff arrangements. And from everything that I see both the Foreign Minister and the Trade Minister and the Prime Minister are well aware of that fact and are making the appropriate representations.
The only other point that I’d make is that we do have concerns, and certainly our members have concerns, with respect to the potential imposition of tariffs on some of our trade partners i.e. not us. And by that, I mean, if you've got, for example, a tariff that's imposed on China, then that has the potential to reduce demand for Australian commodities that go into Chinese products that they then sell into the American market.
The challenge for us there is that there is a risk with respect to jobs. Australia is a trading nation. One in four jobs are trade dependent. So for us, making sure, as much as we can, that we are resilient to that risk is important, and that means doing everything that’s within our reasonable control. And that comes back to the point that I made before about being competitive. We can only control what we can control. Be as competitive as possible, having the right type of regulatory settings. That's something that we can control. That's something that we should invest in.