Jennifer Westacott interview with David Speers, Sky News

Event Jennifer Westacott interview with David Speers, Sky News

Speaker Jennifer Westacott

Date Thursday 11 April 2019

Topics A plan for a stronger Australia

E&OE

David Speers, host: We are joined by the chief executive of the Business Council of Australia, Jennifer Westacott, joining us from the Strong Australia event in Adelaide. I’m sorry I couldn’t get there Jennifer. But there’s a bit going on here in Canberra. Before we get to what’s been happening where you are and the conversations you’ve been having there today with some in the business community in Adelaide, the elections begun. Finally. Here we are, and you’ve released today a to do list that both sides should be taking a look at. Looking through the list, a fairly obvious one, grow the economy faster. Do you think either side have the policies to grow the economy faster, because let’s not forget the last two results we’ve seen have been a little sluggish on the economic growth front.

Jennifer Westacott, chief executive Business Council of Australia: Very sluggish, very sluggish. Look, I think as we’ve got around Australia people have told us they want their wages to grow, they want their power bills to go down, they want congestion to be dealt with in their cities. They’ve also told us they want a plan for the country, a plan that sort of secures their jobs, that gives them a sense of, that they’ll have the skills to do their jobs. I guess our point David in this document, is you cannot do any of these things if the economy does not grow faster. And, we have to ask ourselves and both political parties have to say is a 2.3 per cent annual growth rate good enough to do the sorts of things that Australians are talking about? Does it protect us from the future? Does it give us the resilience to keep growing, to keep growing people’s wages, growing their living standards? That’s the sort of question we’ve asked and then we’ve got a set of actions, some to do now, some to do later, that we think all contribute to a faster rate of economic growth. And, I think the most important thing to say in an election context is stronger growth, faster growth is fairness. You cannot have fairness if you’ve got an economy that is growing slower, and slower, and slower because it’s always going to be a discussion then about winners and losers. A faster growing economy is a fairer economy.

David: Well, on that for a long time you’ve argued the case for a company tax cut for bigger business, that debate has been run, it’s been, you know, lost. There is no sense that either side is going to take this to this election. So in the absence of that, what should they be doing? What should they be planning to do to boost growth?

Jennifer: Well, there’s a few things that can be done. I think at some point we are going to have to return to the company tax stuff but that’s a conversation for another today. But we haven’t let up on it in the document obviously. Look, I think an investment allowance is really important to try and target some investment, it’s the problem. It’s very stubborn. It’s stuck as a percentage of GDP in 1990s levels. What can we do about that? We’ve got to kind of having this infrastructure boost that both parties, I’m sure, will talk about but we’ve got to make sure it is the infrastructure that’s going to increase productivity. The skills agenda is hugely important to increase productivity, and we’ve got to do something about that very, very quickly. And, of course cutting red tape. Now in an election context, the whole regulatory stuff isn’t as particularly as exciting but it matters a lot to small business, it matters a lot to regional communities. And, I think the other thing is we’ve got to make sure that we don’t end up in an election context with so many things being taken off the table that when we come out the other side, we cannot get a plan for growth. And, look, we’ve seen that for the last decade, haven’t we? Where so many things get taken off in an election context and then you end up with a very small set of things you can do. That’s my plea to both political parties, don’t take stuff off the table, agree to work it through, put the detail out, do the thinking. And, I think the most important thing, if I could think of one issue at the moment that I think is really important for growth, do not take a set of actions, as politically interesting as they are, that are going to tighten credit because that is the last thing we should do.

David: When you, the other point you have raised here, quite rightly is power bills. This has been a long running problem, they’ve only gone up and up. How do we get them down and how do we provide more certainty for business to invest in new energy generation? We’ve had this debate for a long, long time. When you now look at what Labor has put on the table, what the Government has put on the table, do you think either side has got it right?

Jennifer: No, there are still so many unanswered questions here. If you look at Labor’s plan, look there’s some good idea there, they’ve certainly clarified a little bit of the stuff we were asking them to do. But nobody really has got the detail here. You’ve got to break this up into three chunks. What are the immediate actions that get people’s power bills down and there’s piles of recommendations that are on the table from the (Australian) Competition and Consumer Commission, from Finkel’s review. Why don’t we just kind of have that and get that done? So, we would be, in our plan, we’ve kind of specified that. The second phase is how are we going to get investment, particularly investment in dispatchable power, in baseload power so that we get that reliability and that affordability going forward? So, we want to see detail on that.  And the climate change piece, the great mess of climate change policy, a mess for a decade. We’ve got to make sure that we have a realistic, manageable, pragmatic change and transition to a lower carbon economy. And what we want to see is detail because you and I have talked about this for years, we cannot go through another false start on the other side of this election. We’ve had false starts for a decade. We cannot have another one. We cannot say, ‘look that’s a really important issue but we’ll sort it out later’. We’ve been sorting this, saying we are doing that for a decade and we haven’t done it. We’ve got to know how we are going to do these things, what will be the implication, what sectors will be affected, which regions will be affected, how will we mitigate that? We’ve got to be able to answer these questions to credibly, from either political party, say to the community, we’ve got a solution to this.

David: The other big issue, and I’m sure it came up today, maybe you can tell us amongst the business figures there, industrial relations. A lot of workers want to get their wages up. Bill Shorten is campaigning very strongly on this. He’s talking about, well certainly the unions are talking about a living wage, and pattern bargaining and so on. We’re yet to see exactly I think where Shorten is going to land on industry-wide bargaining.  But what does need to happen in our industrial relations framework from your point of view?

Jennifer: We need to make sure that we keep the things that are working, and now the enterprise agreement system, the system where employers and their employees sit down at an enterprise level and work out what the market is, what’s happening in their industry, in their particular location, what technology they need to use, how they organise rostering, training and so on. That system at the enterprise level has served us very, very well. It’s given us higher wages, and I think the most risky thing we could do is to chuck that out and go to a system where a union in another part of the country says, ‘this is the standard for this whole industry across the country, irrespective of the circumstances of a particular enterprise, the way people work in different geographies across the country’. I mean, think about the difference between mines in Western Australia and mines in Northern Queensland. They are different, their markets are different, the circumstances, and that would flow across to small businesses who have very, very unique things. So we’re saying a move to what’s called pattern bargaining, or multi-employer agreements, would be a very, very, very serious backward step for our economy. It would lead to more strikes. I believe it will put jobs at risk because it will reduce the very thing that we’ve been talking about here in Adelaide, the capacity for companies to innovate and change and grab new markets. It will restrict that. It will put a straitjacket on the capacity of businesses to adapt. But we do need to all sit down together to work out how we make the system work to drive productivity which is the way we will drive wages and make sure that the workers get the benefits of those productivity gains. No one denies that, that people have got to get the benefit of that through higher wages and better conditions. So on the EBA process, I think it would be very, very serious to move down that pattern bargaining front. If there are issues in sectors like the non-government sector where people have not benefitted from that system, let’s fix that. And on the minimum wage, let’s be very careful that we go back to the sort of pretty simple thing, give the Fair Work Commission tighter instructions, confine it to the 180,000 people on the minimum wage, stop it moving into the awards system, and make sure that we retain the independence of the role of the independent umpire.

David: Well, Jennifer Westacott, I appreciate you joining us there from Adelaide this afternoon.