Event: Jennifer Westacott interview with Laura Jayes, AM Agenda
Speakers: Laura Jayes host, AM Agenda; Jennifer Westacott chief executive, Business Council of Australia
Topics: Economic growth; budget; industrial relations; multi-employer bargaining
Laura Jayes host, AM Agenda: Business Council of Australia's CEO, Jennifer Westacott. Jennifer, great to see you once again. What is the best way to grow our economy? When you look at comparable countries in the OECD that seem to be sinking into recession right now.
Jennifer Westacott chief executive, Business Council of Australia: Yeah, look, we are unlikely to go into recession. If you, of course, take into account of what the Reserve Bank is saying, the Treasurer, most economists that's a good starting point, our economy is bouncing back very fast. So we've got a better starting position, but how do we get growth? Well, you get growth by encouraging investment, getting businesses to do more, getting the private sector to do more, you get growth by diversifying the economy, getting into these supply chains that are just huge if you think about that Asian middle class of 3.5 billion people. You get growth by skilling people so that they can actually attract investment, when I talk to these big companies internationally, why would they come to Australia? Skilled people, access to these Asian markets, you get growth by improving infrastructure, you get growth, fundamentally, by improving productivity, and that brings with it higher wages. So it's a kind of standard recipe, if you will. It's got to be nuanced for the world that we're currently living in, which is very volatile. But you know, your summary is absolutely spot on, this budget has to really lay out that long term fiscal strategy, how do we get that discipline? How do we maintain that discipline? How do we drive growth? And how do we start doing the reform of spending, not cutting spending, but making sure that we are reforming those big services, aged care, NDIS that people get better outcomes, and that we're able to control costs over time.
Laura: You mentioned the NDIS, it's really expensive. Do you think this is one of the more obvious areas that the government can perhaps pull back on spending? The NDIS was designed to be for the profoundly disabled, is that an area that Labor should look at?
Jennifer: Well, I know that they are looking at it, and the Minister has made those announcements, it's a very important area to make sure that you're trying to make sure that people are getting the right services when they need them. They're getting services efficiently, that we are containing the kind of spiking of cost, because when things spike in cost, and I've run some of these services when I was a public servant, it's normally because people aren't getting the services they need so people have to respond to that. Making sure that we get that on a kind of even keel so that the growth rate that's currently there. To my knowledge, the NDIS I think now it's bigger than the health budget, we've got to make sure we sort of curb the growth of spending versus cutting the spending by improving the quality of spending, and the government I think is committed to doing that.
Laura: Yeah, and we're not ignoring the productivity benefits that come out of the NDIS, either. But looking at another area…
Laura: One of the more contentious issues at the Jobs Summit, but the government is pushing ahead with it, with the push behind them of the unions, and this is big changes to IR, collective bargaining across many companies and areas of employment. Are you concerned about this? I think this is going to be looked at next week, isn't it?
Jennifer: Yes, we are concerned. Let me just go back to your first question about how do you grow the economy? You grow the economy, through innovation. Now, innovation is about people sitting down with their employees working stuff out, how do we get into this market? How do we use this technology? How do we train people better? And that is the enterprise bargaining system, that's about doing it at an enterprise level. So a manufacturer in Bendigo, kind of working with their people, understanding their markets, understanding their products, working together to grow, expand, pay people more. So that's the first point and that's what we want to see in this legislation. We are concerned about some things, we are concerned about some of the demands from some of the unions that they want to see widespread strike action, that will freeze dry the economy. We're concerned that we haven't seen a package yet that shows how all of these things are going to actually grow wages. And what we're concerned about is, although there's been detailed discussions, we are yet to see that overarching framework about how these things will work together, how we're going to grow wages, which we support, and make sure that we don't get unintended consequences of widespread industrial action of a more complex and confused system. What we want to see is a simple system, it's easier to bargain, people are encouraged to bargain, and they bargain in good faith. And that makes sure that they're better off as an enterprise and their workers are better off and that people don't get swept up in widespread industrial action, even when their business is running well, and everyone's happy. And I see so many companies around Australia where people are just getting on doing stuff, doing amazing things. We can't put that into a multiple while we sort of have this very complex IR system.
Laura: Next question is a bit of a tenuous link here, but you talk about growth and you've talked to us many times about or reminding us that private business, the private sector is the backbone of the country. That's where you see growth come from. Today, and for the last week, we've seen activism creep into sports, big, multimillion dollar sporting teams, some of their players are now saying that they don’t want to be sponsored by fossil fuel companies. It's even going further than that. We're talking about meat companies, etc. It could even you know, the line could even be blurred even further. How concerned are you about this? And I don't want to speak on behalf of the businesses you represent, in particular, but where does it stop? And what does this do to these businesses in terms of them being part of communities?
Jennifer: I think we've got to remember, and I just remind everyone that there are very few sporting teams, whether they are big sporting teams, or the kids cricket team at Queanbeyan, that aren't sponsored by some business. Where someone who hasn't put their money up to say, look, I want these kids to do better. And all across Australia, it's corporate Australia and small businesses that gets behind the local team. It’s corporate Australia and small businesses that get behind the local arts things. So I think when people start saying, ‘oh, we don't want money from this person, we don't want money from that person,’ I kind of understand the sentiment. But I think we've got to remember that we really need to remind ourselves that many communities just simply would not thrive if there weren't a business there, and that's obviously the stuff that we've been doing with you at Sky on Strong Australia is we get out and we see the impact of big and small businesses working together. We see the impact of big companies investing in regional Australia, and then of course, that extends into sport sponsoring things. You know, I think we've always got to try and have some common sense here. Because at the end of the day, this is a sporting team that’s not going to get money, there's a kid that's not going to get advanced because that sponsorship wasn't there. We've got to make sure that we don't discourage that. Obviously the country is on a journey to decarbonise. But we've got to do that in a careful, stage-managed way. And we've got to make sure that that we kind of maintain that, I guess that sense of common sense. But to your question about the private sector, and this is what I guess is the fundamental point of our budget submission, or our budget statement. Whatever we do, we must make sure that the private sector is encouraged to invest, to employ people, to pay them more, to hire them, to train them. We've got to be very careful that we don't take any action that deters that investment because that is how we're going to grow the economy. But what is growing the economy mean? More jobs, better paid jobs, more money in people's pockets.
Laura: Well said Jennifer, budget week next week. We'll see you then.
Jennifer: See you then.