Tom Connell, host: Joining me now is Jennifer Westcott from the Business Council of Australia, the chief executive. Thanks very much for your time today, you were quoted yesterday talking about better management of outbreaks. First of all, I guess the concern here is that we were always told the outbreaks are coming, the Northwest of Tassie was cited as a success story, so the question has to be asked what has happened in Melbourne?
Jennifer Westacott, Business Council chief executive: Yeah. Look, clearly mistakes have been made Tom and we have to get the systems right here because I think people keep forgetting; we're going live with this for quite a long time. I mean, the general consensus is we're two years away from a vaccine. So, we have to find a way of living with this and keeping the momentum going to open up the economy because if not we’re going to sap confidence and sap jobs. So we have to learn from what mistakes have been made and we have to put in place the systems, whether it's quarantine, whether it's border control, whether it's local lockdowns, how does that work? So that we've got a predictable system and the community feels confident that we've got the health management right
Tom: Because the hammer blow for business is opening, shutting, opening, shutting?
Tom: This cycle will just be devastating. That's the question here, isn't it, we need to figure it out? Even if things are a bit more restricted in some areas. I mean, just go to one area nightclubs, can they be open? I don't know and they're the things on the table right now?
Jennifer: Absolutely. The kind of one extreme measure to the other, stop-start, that is going to sap confidence, it's going to cost jobs. That's the last thing we should be doing. What we need to do is say to people, ‘look, we cannot eliminate this without a vaccine. We're a long way from that. We have to live with it. Therefore we have to get the systems right to manage these local outbreaks, which will happen’. And of course we have to get the systems right constantly, to make sure that the health outcomes are the primary outcomes and that we're looking after vulnerable people in the community and the community needs to understand, to your point, well, how does that system work? I personally don't agree with a border closures and I think they are an extreme measure but if we're going to do them, let's get the system, right. What is the permitting system? Who's going to be exempt? How will that work? Because then the community sort of says, ‘yeah, I kind of know how we're going to live with that’ and then businesses can plan and people can plan their own lives.
Tom: The tricky part is, I guess, there's always costs to things. For businesses, you're only as good as your weakest link. You know, who's the person out the front making sure people are spread out in a queue? It goes beyond just slapping down a sticker. You know, who's making sure the table has been wiped down, this type of thing? It costs money but it's a big responsibility for business now as well, isn't it?
Jennifer: Absolutely but it's a big responsibility for individuals as well. We're all in this together and I think we have shown a fantastic kind of unity as a country. Look, I'm so proud of Australian businesses and the way they've made shopping centres, workplaces, COVID safe. And, of course they rely on people to cooperate with that, to keep their distance, to keep their hands sanitised, to not come out when they're feeling unwell and of course to have the app on. So, we've got to have businesses doing the right thing and I can assure you that the lengths that some companies are going to are just staggering, to keep their people safe and their customers safe. But we've also got to kind of take our own responsibility to and to make sure that we're doing the right thing.
Tom: It's very cultural I know and everyone's had that situation where there's a handshake extended and it feels rude but I guess the more we have our leaders saying it, the easier it is to skip the handshake or the hug. The common phrase has been ‘rebuilding the economy’. Jennifer, it's going to look different, we know that. What about specificity here? I mean, what radical changes do you think we need as we emerge out of this?
Jennifer: Yeah, look, I think you've got to get clear what the task at hand here is. So, of course the health task is absolutely essential but what's the real task here? And I think people have lost sight of this to be frank, in the debate. Let's just go to the numbers. We've got 3.3 million people on JobKeeper, we've got 1.4 million people on JobSeeker. Let's just assume that some of that 3.3 million people will not be able to return to their jobs. So, let's just for argument's sake say we have got to create 2 million jobs and we've got to create those in two years. You know, if we look back at job creation, it took us 10 years to create the last 2 million jobs and that was before COVID and we don't have China growing at the rate it was post the global financial crisis and we don't have population growth. So anyone who thinks that simply few adjustments here and there is going to do that task, I think is pretty naive. So what do we need to do? The most important thing is we have got to get activity back in the economy. So one, let's get the health system under control and make sure we can open the economy up. Two, we have got to get businesses investing. It's businesses who've got to put new equipment in place, expand into markets, train their staff - they've got to invest to get that activity and the job creation. And of course, governments will have to stimulate, be it public benefit infrastructure, putting money in people’s pockets through tax cuts, obviously through the JobKeeper and JobSeeker arrangements, which the government has said, it will taper off it, it won't just cut off. So all of those things have to be done. And then of course, you're getting into the real specifics. What do we do about our inadequate skills system, so that people can get those skills quickly particularly in digital areas so that they can get the jobs that are going to come? How do we quickly digitise the economy? How do we genuinely kind of leapfrog into a more digital economy? How do we keep trade and investment going? And how do we incentivise businesses to invest? Because the risk is that they hang on to cash because they're very uncertain. We need to give them that incentive to invest because it's investment that will create activity, it's activity that will create those jobs.
Tom: The more jobs stay for now, I guess, or survive through all of this, the less we have to actually recreate. What do you think of JobKeeper in the next phase? What's your advice to government on the reboot that's coming?
Jennifer: Well, clearly the government has signalled that it is not going to just cut it off. I mean, it needs to be tapered in some way and that will be very much those sectors which are in continued distress and there's nothing that those sectors can do about it because it's so linked to the reopening of the economy and the government's made that very clear. It's about getting the balance right between the incentive to return to work when jobs are available and supporting those people who simply cannot return to work on JobSeeker. As you know, we have had a longstanding argument at the Business Council that the Newstart allowance was inadequate and I think there's now a very, very strong case for making sure that we don't return to the Newstart allowance, and of course, government has as indicated that it's looking at that. But I keep coming back to this point Tom, we can have a debate about September to October, October to November, November to December but we've got to live with this thing for at least a couple of years while we get a vaccine, if we get a vaccine. So, the top task is to create those jobs I’ve talked about. The top task is to skill Australians and give them access to those jobs. That's got to be our focus. So yes, we've got to taper JobKeeper. Yes, we've got to do something about the underlying allowance in JobSeeker. But the most crucial task of the National Cabinet is to create those new jobs
Tom: We’re nearly out of time but I wanted to ask you this; $12 billion a month on JobKeeper, there's no shortage of a willingness to shovel money out the door. I remember the huge fight, and I'm sure you do, we had over the company tax cut, about $11 billion a year. Do you think that less eye watering figure all of a sudden might be back on the table? Or you just can't see the government going down that path?
Jennifer: Look, you know, you've got to sort of take a long-term view here. If in five years’ time or in three years’ time, you’ve still got one of the highest tax rates in the world, one of the most uncompetitive business tax systems and a bizarre two tier tax system, I’m not sure we'll have done the policy work properly. It's a very controversial issue in the short term. What we're saying in the short-term, Tom, is at least do an investment allowance. At least give companies, be they large or small, the incentive to bring forward their maintenance, to put on that extra machinery, give them that investment allowance, which actually has bipartisan support, Labor proposed a similar thing before the last election. So at least do that. I mean over time; somebody has to come to terms with the fact that our company tax rate is uncompetitive. We're not asking for a low company tax rate, we're asking for a competitive one. You know Tom, companies say to me all the time, international companies that is and this country is still very reliant on foreign capital, ‘do you know, it's so hard for us to get capital from our global boards because we are just simply not attractive in terms of return on investment’. At some point, somebody has to confront that reality. In the short to medium term, we're saying do a comprehensive investment allowance to bring forward and fast track that investment. That's going to drive activity and drive job creation.
Tom: We'll see where that goes. Jennifer Westacott, appreciate your time today. Thank you.
Jennifer: You're very welcome. Thank you.