Article by John Kehoe, courtesy of the Australian Financial Review.
Labor and the Coalition are consigning younger generations to a future of higher taxes, ballooning government debt and poorer living standards, Business Council of Australia chief executive Bran Black will warn.
The “brutally honest” reality was that all sides of politics were failing to address the problem of runaway government spending that Treasury predicts over the coming decades, he will say in a speech at the BCA’s annual dinner in Sydney on Tuesday night, according to an extract of his speaking notes.
Mr Black noted that young Australians were fearful they would never be able to afford to own a home and were living with the expectation of “being taxed more and more as our nation’s spending needs escalate”, and the relative size of the workforce declines.
“We’re at risk of bequeathing a poorer quality of life to our children than that which we inherited.”
Personal income tax will soar to an unprecedented 58 per cent of the overall federal tax base in the 2060s – up from an already-record 50 per cent – and be shouldered by a smaller share of working-age people unless there is “policy change”, Treasury’s Intergenerational Report warned last year.
Mr Black’s speech is due to be delivered in the presence of Prime Minister Anthony Albanese, Treasurer Jim Chalmers and leading CEOs.
The Australian Financial Review reported on Monday that in recent years a growing number of business and political leaders have privately questioned the effectiveness of the BCA, at a time when the job of public policy advocacy has been made difficult by economic populism, public polarisation, a greater distrust in key institutions, and a series of reputational own-goals by BCA members such as Qantas.
Marking 12 months in the job, Mr Black’s conversations with more than 100 chief executives over the past year have revealed some concerning trends.
He noted that CEOs had told him the Albanese government’s workplace law changes had made them far more cautious about hiring, as he backed a plan by the Coalition to unwind Labor’s multi-employer bargaining rules.
Other regulatory moves, such as the Coalition’s threat to enable the breakup of big retailers, and a Greens excessive profits tax, had caused big companies to invest overseas instead of Australia, Mr Black said.
“What also rings true is that rather than feeling confident in our growing national prosperity, many CEOs feel we are losing our way.
“We have let the balance shift too far away from encouraging Australians to grow, hire, innovate and be more competitive on the world stage. Instead of taking the big steps on the things that matter, we are taking incremental – but noticeable – steps backwards.
“This shouldn’t be dismissed as talking Australia down. It’s a belief right across our membership that we can and must do better for our future generations.”
It is the second time in two weeks a major industry group leader has criticised Labor’s industrial relations changes, following Minerals Council chief Tania Constable’s dressing down.
The BCA will seek to influence five key policy areas in the lead-up to a federal election due by May.
These are easing the cost of living, tackling the housing crisis, achieving net zero emissions by 2050 with both affordable and reliable energy, paying for the growing care needs of Australians, and developing a skilled workforce.
“The real answer, as any good economist will tell you, is that we need to become more productive,” Mr Black noted.
“That is the only thing that really matters when it comes to improving long-term quality of life in this country.
“It means less red tape and regulation. It means more flexible workplace laws. It means simpler planning systems. It means a more efficient tax system.
“Now, I’m not naive. I know these steps are challenging. Indeed, they’re painfully hard and come with electoral risk. But there are some steps that we should take, and take soon.”
