Jennifer Westacott interview with Michael Rowland, ABC News Breakfast

12 May 2021

Event: Jennifer Westacott interview with Michael Rowland, ABC News Breakfast

Speakers: Michael Rowland, host; Jennifer Westacott, chief executive Business Council of Australia

Date: 12 May 2021

Topics: Budget 2021


Michael Rowland, host ABC News Breakfast: Let's bring in Jennifer Westacott, the chief executive of the Business Council of Australia. Always great to see you. Jennifer, so what's your broad take on the budget?

Jennifer Westacott, chief executive Business Council of Australia: We think that this a really strong budget. We think it shows the benefit of a growing economy. It strikes the right balance between driving the private sector through those tax incentives, through skills, through infrastructure, through the big spend on the digital economy, through women's participation, and then paying the social dividend. Huge expenditure into aged care, mental health and disabilities. I think if I have got a concern - it's the growth numbers in the outer years, which are pretty low and they need to be more ambitious. Because we've got to think big as a country. We've got to think big about expansion, think big about innovation, think big about investment, think big about skills. Because it's that growth that's going to get us higher wages and it's that growth that's going to sustain that spending in the social programs.

Michael: Growth for many years and decades has been underpinned by a strong migration program. As we know, care of the shut borders, there are no migrants coming in. Migration will only slowly pick up in the years ahead. How do we achieve full throttle growth without a big immigration program?

Jennifer: You've got to drive productivity and you've got to drive competitiveness. You've got to drive business investment. What's in the budget is great and we would like to see that expanded to the companies with the big balance sheets. But you've got to drive business investment. That's obviously tax, but it's also things like regulation. The skills stuff is fantastic. It's a huge package and we've got to sustain that and continue to reform our skills system so that we get people into those higher skilled jobs. But we are going to have to carefully and gradually get our international border open through starting with international students and then moving to skilled migration. Because if we don't, we will not attract those big international companies coming and setting up their manufacturing, their IT systems in this country, which they regard as a safe place to do business.

Michael: On the border, the tourism industry, for one, is screaming blue murder this morning about the border now not being reopened until the middle of next year. What do you think of that timeline?

Jennifer: I think that it is a conservative timeline and the government is obviously taking a very conservative approach. We've said that you've got to start with domestic borders first. Once you've done vulnerable people - 1B as it's called in vaccine rollout, then there is no basis to shut state borders again. We have got to end these random lockdowns when you have one case. So that would help a lot of people in the tourist sector. Because 52 per cent of people say that they're not travelling because they're worried about not getting home. Then we have to gradually and carefully open up those international borders starting with international students, returning Australians, skilled workers. And then we've got to look at those vaccine corridors of countries with comparable low infection rates and high vaccination rates. But you know, it's a slow and careful approach that the government's taking and there's a lot of very conservative assumptions there about tourism. But there's also a big package in the budget too that was announced earlier in the year to assist those sectors that can't get back up on their feet due to the restrictions.

Michael: The Treasurer displayed enormous political malleability last night in signing the debt and deficits mantra to the political dust bin, at least for the time being. Are you concerned as a representative of the business community about net debt in 2025 approaching $1 trillion

Jennifer: It's a $1 trillion mortgage on the country. But let's put it into perspective. First of all, as a ratio of debt-to-GDP, it's low compared to other countries. Secondly, we've got the lowest interest rates on record, so it is actually affordable. I think that the main thing Michael is that we have to keep growing the economy and that's why I'm concerned about those outer years numbers. Because it's a growing economy that you can see already improves the budget bottom line and a growing economy that allows you to start paying down that debt and it's a growing economy that allows you to get people's wages up and people are worried about the wages not going up. But of course, at some point, governments are going to have to deal with fiscal consolidation. And that's not going to be done and it can't be done through mass austerity measures and it can't be done through high taxes. It's got to be done by growth by prudent spending and constantly trying improving business services.

Michael: Jennifer Westacott from the Business Council of Australia. Thank you.


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