This opinion article by Business Council chief executive Jennifer Westacott appeared in the Australian Financial Review on Friday 20 March 2020.
No one needs reminding we are in challenging and unchartered times, but we can be hopeful that by pulling together, Australia will come through the other side of this difficult period.
Let’s not forget that the nation faces the impact of coronavirus in a strong position. We have a robust health system, a solid financial system and well-functioning essential services and supply chains.
Before the pandemic, our economy was growing. Interest rates were at record lows and our banks are strong.
Unlike at the time of the rollercoaster of the GFC, we know this extraordinary health event will eventually end. The glimmer of an economic turnaround is already underway in China.
What we do over the next three to six months will help us cushion the impacts and weather this unprecedented storm. Beyond that, the decisions we make will define the ability of businesses to bounce back and drive the economic recovery.
For now, the priority must be keeping Australians safe.
Businesses need to keep operating, people need to keep working, money needs to go into people’s pockets, and our essential services and major industries must keep going. These are the cogs that keep the economy turning.
Governments are taking strong action, including the Morrison Government’s well thought through stimulus package to support business activity. It is also investing up to $15 billion to ensure customers, including businesses, can continue to access affordable credit from smaller lenders.
These efforts to support the economy, jobs and businesses will be further bolstered by the RBA reducing the official cash rate to 0.25 per cent and introducing quantitative easing, alongside providing $90 billion of support for SME lending.
Australian businesses are resilient and acting quickly to manage rapidly changing circumstances. They are taking proactive steps to keep their staff and customers safe, doors open, and importantly keeping people in jobs.
Woolworths and Coles have introduced a dedicated shopping hour for the elderly and vulnerable, are hiring thousands of extra workers to meet demand, and putting in place measures to quickly restock shelves.
Businesses and industries will need as much freedom from the drag of unnecessary red tape and regulation to be as agile as possible to get through the crisis and emerge strongly on the other side.
We can take practical measures now so it is easier to do business, keep people in jobs and the wheels of the economy going.
Cashflow is paramount, and even further efforts may be needed for small businesses and sole traders.
The accelerated depreciation measure should be extended to larger companies so they can bring forward purchases of machinery, upgrade their plants, and make big fleet replacements. These investments will have a big flow through effect into the broader economy.
Instead of asking companies to pay tax monthly, let’s consider quarterly instalments, and follow the lead of NSW on payroll tax exemptions.
The longer this goes on, low-income households and people who find themselves temporarily out of work, including those who have to take leave because of illness, will need additional government payments. We should make it as easy as possible for people to access these vital payments.
We must work harder to make it easier to do business. I’ve written to all councils urging them to relax curfews on delivery times so we can stock shelves. Some councils and Queensland have already done this. South Australia is deregulating its retail trading hours for 30 days.
We should extend visas for people who are already here so they can fill shortages for seasonal work.
Approvals for projects such as shop fit outs should be fast-tracked to 14 days so people can take advantage of the government’s depreciation and instant asset write off initiatives.
We must also ensure essential workers can get to and from where they are needed, whether that’s keeping our resources sector going or keeping the lights on.
And, let’s pause the rules around keeping time and attendance records when many people are now working from home.
Business is the glue that keeps communities together and economies growing. Just as businesses stepped up during the bushfire crisis, companies are paying their smaller suppliers immediately and being understanding on repayments.
Companies are being as flexible as possible to keep staff safe, introducing working from home arrangements and split shifts. They are paying staff, including casuals, who are forced to miss work, and taking other steps to retain staff. Telstra has introduced global epidemic and pandemic leave for all staff.
Many companies are doing what worked during the GFC, getting workers to take leave or work different hours because the primary focus is to keep people in jobs. Businesses need the headroom to do that.
Banks are keeping their branches open, continuing to lend, extending or deferring payment terms, and taking a flexible approach to lending.
After six months, we need to revisit the constraints that were already holding the economy back.
It will be time to reboot the economy, and ensure it is stronger as we recover.
This means introducing incentives to encourage big investment, removing the handbrake of productivity-sapping regulations that force extra costs onto consumers, reducing major project delays, and axing anything that stands in the way of businesses growing and employing Australians.
Critically, we simply must remove the stranglehold of unnecessary red tape that makes it harder to quickly employ people.
Together, Australia will get through this. And, together we can take steps to ensure that all parts of our economy are as fighting fit as possible when we emerge on the other side of these extraordinary times.
Now more than ever, governments, businesses and the community must work together to shape and drive a rapid and strong economic and social recovery.