‘Uncompetitive, ill-conceived’: BCA stands firm on national productivity strategies

At its annual dinner in Sydney on Monday night (8 September), the Business Council of Australia (BCA) held firm on its focus to hold the government accountable in its efforts to boost productivity.

In his opening address, BCA chief executive Bran Black said now that the roundtable had come to a close, the time for action was now.

“Our focus — and the focus of our 29 partner groups — is now on making space for this positive reform to happen. The time for action is now and we’re encouraged to see some useful first steps.”

“Ultimately, everything we are pushing towards is for the delivery of a more productive Australia. Because that’s what lifts living standards. That’s what creates well-paid jobs. That’s what delivers better hospitals, schools and services. That’s what allows us to innovate and compete.”

“And that’s what we know will ensure the Australia we leave to our kids is even better than the Australia we enjoy today.”

In his speech, Black was also firm on BCA's stance against the speculation of the government's plan to adopt the Productivity Commission’s recommendation to cut the corporate tax rate to 20 per cent for companies with turnovers under $1 billion.

With this recommendation, 99 per cent of companies would be set to pay less tax, yet 500 of Australia’s largest companies, including BCA members, would face a tax increase.

Black said: “by the same token, we’ll stay resolutely opposed to policy ideas that scare business investment away” and called tax ideas such as the cash flow tax “uncompetitive and ill-conceived”.

Ideas the council would remain against also included Commonwealth regulatory burden, inflexible and unbalanced workplace relations settings, AI regulations condemning Australia as a “technology taker”, and policies that push away capital.

“Because every time we lose investment, we lose jobs, tax revenue, dividends, superannuation contributions, supply chain spend and productivity,” Black said.

“We condemn ourselves – and our kids – to eating smaller slices of a smaller pie.”

To the audience, Black did pass acknowledgement to Treasurer Jim Chalmers for taking credit for admitting the budget was not yet sustainable enough, productive enough, or resilient enough, and attributed this to the BCA's motivation in urging the government to stay true to improved productivity.

Black said it was encouraging to see the broader recognition of the “simple reality” that business investment and productivity were the bedrock of national prosperity.

“The simple fact is that we are underperforming – investment is still only moderately above the thirty-year lows of June 2022. Regulatory friction is too high. And our tax system isn’t competitive.”

“These challenges collectively represent the reason why last month’s Economic Reform Roundtable was so important. The most important thing the Roundtable did was sift through the clutter and prioritise the inches we need to move the dial on our country’s economic performance.”

Black pledged BCA would continue to lead the conversation on tariff reform, a proper front door for investors, paperless trade, work-integrated learning, recognition of prior learning, a national AI skills plan, EPBC reform, a pause on the national construction code and principles for tax reform.