This year’s federal Budget must address constraints on economic growth and resist the urge to raise taxes, the Business Council
This year’s federal Budget must address constraints on economic growth and resist the urge to raise taxes, the Business Council of Australia says.
The group’s Budget submission calls for the Rudd Government to chart a path away from deficit and the level of intervention in the economy through cutting government expenditure rather than slugging business.
According to the submission, Australia’s capacity to reach above-trend rates of growth may be hampered as the economy recovers because there is still a low unemployment rate.
“This highlights a critical need for policymakers to address key supply-side issues,” the submission reads.
“In the BCA’s view, this needs to be done through the pursuit of policies directed to improving workforce participation, education and training and the provision of infrastructure.”
The BCA says there must be a focus on infrastructure investment and regulatory reforms such as a single national heavy vehicle regulator.
“In the area of federal-state relations, the success of COAG’s [Council of Australian Governments] broader reform program—including delivery of a seamless national economy—will be critical to Australia’s growth prospects,” the submission says.
The Rudd Government has also been asked to increase Infrastructure Australia’s transparency so business can look at the analysis underpinning the recommendations for government investment.
“The government can demonstrate both leadership and goodwill by using this year’s Budget to publicly release Infrastructure Australia’s cost-benefit analysis of major projects,” the submission says.
In launching the document, BCA President Graham Bradley says action needs to be taken to support long-term sustainability capable of addressing future challenges.
“We now need a road map to move Australia into an era of strong productivity and high-quality investment,” Bradley says.
While conceding it will be a difficult balancing act, Bradley says the Budget will need to support broader reforms to taxation, regulation, education and skills.