Business tipped to push for a triumph of policy over paralysis

The business community was effectively sidelined at the last federal election, and it felt somewhat miffed about it. Business associations were caught flat-footed at the suddenness of Julia Gillard’s announcement of the campaign immediately following the removal of Kevin Rudd as prime minister. This time around, they have over seven months to organise their preparations, to craft policy submissions, intensify their lobbying and engage in behind-the-scenes influence. So what will we see?

Elections are important times for businesses to push their agendas and highlight key economic issues. Campaigns are their big chance to shape the debates that matter most to them. It is also an opportunity to keep certain issues – those they might not want to confront – off the agenda.

The big issue for business at the September 2013 election will be achieving a clear outcome and, in all probability, a return to a conservative government. The Rudd-Gillard government has not been anti-business. In fact, it won many plaudits from business sectors over the courageous action it took in the initial year of the global financial crisis. But Labor has perhaps overly accommodated the unions, restoring many of their political and industrial powers. The abolition of the Building and Construction Commission was a clear sign of how beholden the government is to the union sector.

The business community, however, perceives the Gillard government as weak, indecisive, unpredictable and given to populist expediency. It has never warmed to the minority government, believing it is too frequently compromised by marginal voices. It would prefer a government with a substantial majority and, if possible, a Senate majority to boot.

There was no future vision offered by either side in 2010, but this year provides both major parties with the opportunity to sketch out their longer-term priorities and present some vision for the nation’s future. Restoring prosperity and boosting our competitive position would be a start. Managing the economy better and bringing fiscal discipline back to balance the budget would be another worthy ambition. Labor has done well keeping people in jobs and unemployment low, but the Coalition still enjoys the reputation as the better economic manager and, with its current frontbench, would probably maintain this edge to the next election.

Business has been irked by Labor’s industrial relations revisionism – restoring basic award conditions for employees, restoring union access and bargaining rights and almost returning to industrial arbitration through the cumbersome Fair Work Australia commission. Most businesses will probably not want a return to the scorched earth policy of WorkChoices (which nevertheless brought pay increases), but prefer a simpler system, clarity and consistency, while reducing the administrative costs to business of compliance.

The symbolic carbon tax and mining rent tax will go if there is a change of government, but business wants reductions in the rate of company tax as well as holding on to valuable tax concessions. Labor annoyed business by promising to cut company tax, only to cancel this commitment and instead divert the dollars to low-income households. It would be a brave party to promise business it will reduce company taxation in the current fiscal circumstances, even though there is international pressure to do so. But reduced taxation may be floated as an indicative objective to placate business leaders.

Big business will be hit with a levy to pay for the Coalition’s generous salary-linked maternity leave scheme, and this will be a cross-subsidy to smaller employers as most of these larger firms have funded maternity schemes already in place. This policy may come in for some revision if the Coalition forms government once business is consulted.

Some sectors of business have called for an increase in the Newstart Allowance for the unemployed, to enable them to actively look for work and in part spur consumer demand.

The perennial issue of escalating red tape and compliance with excessive regulation is an ongoing concern, and may attract obligatory promises to help reduce the burden. However, no-one holds their breath on this one: all governments find innumerable new ways to impose additional regulatory impositions on economic activity.

A big sleeper issue for the election is the quality and appropriateness of education: secondary, vocational and tertiary. As an economy, we need much better secondary schooling, perhaps fewer graduates for the workforce than we are turning out now, and much more investment in vocation and applied learning, possibly with a HECS-like levy on the TAFE sector to increase the supply of skilled workers and training quality.

Business associations do have various interests in environmental issues, sustainability and in addressing climate change. However, on these issues they want more certainty and consistency going forward.

All in all, business — like all other interest groups — has seven or eight months to impress its messages on our political actors. It is not likely to waste this opportunity as it did by default in 2010.

John Wanna is the Sir John Bunting Chair of Public Administration at Australian National University.

This article was first published at The Conversation.


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