The figures released by Treasurer Josh Frydenberg yesterday are sobering. They were always going to be sobering.
The debt will need to be confronted for many years, if not decades. The key to this is to quickly restore the economy and start to pay down the debt. There are various keys to economic recovery and we now all know that small business is a major part of any worthwhile economic activity.
Small business people (and people they are) will provide jobs, innovation, and health (as well as healthy environments). They will provide choice, the ability to quickly change (or pivot) to meet new challenges and opportunities, and they will add to the vibrancy of a community. They are the ones who keep community sport happening and local charities functioning.
When the community is comfortable, then people are less stressed and are more productive. When the community feels safe, people can concentrate on the future.
The debt has to be communicated in a way that is honest – it is very high and must be managed – yet not create feelings of despair and hopelessness. We have managed these debts before and we will do it again.
The reality is we are in a national crisis of a scale that no one except the very eldest in our community has ever seen before. There are of course the groups of migrants from war affected countries who have also experienced major crises. The last crisis for Australia was World War II itself, with the death, destruction and horrors that war bought to our country. Then there was the impact on the economy from the war, which took decades to mend and develop better health for our citizens. We have lessons from those times.
There are of course two issues with this COVID crisis. The first is the immediate need to confront the health crisis, and the second is the immediate and on-going need to build a great economy again.
On the first front, we (our governments and our citizens) have in the great majority managed the crisis – so far. We have seen a recent chink in the response in Victoria, but more on that later.
On the second front — the economy — we have seen immediate actions to keep the current economy happening, keep people in jobs, and provide for people who are unemployed, mainly through JobKeeper and extensions to the amount of JobSeeker.
For the longer term we see that governments are still developing a response as they collect the information needed to inform long-term decisions, plans, and policies. We don’t know when the crisis will finish or how many outbreaks we will need to manage.
Remembering lessons learnt
What we see as an impediment to developing the right policies for the future is the predisposition of some, perhaps too many, policymakers and those in political power to think they know best — and they will decide the future. They will do that without focusing on what has been learnt in the recent and distant past, and without much consultation with those they believe don’t know best (the rest of us).
There has been a tendency to start ignoring the lessons we have learnt. There may be economic arrogance creeping into the development of solutions. Let’s hope it isn’t the laissez-faire economists raising their ugly, ideological heads again. For COSBOA’s part, we cannot complain at all about the consultation we have received – so far.
The examples of failed learnings (perhaps of hubris, perhaps of pride?) are the failed quarantine management in Victoria, and the poor management of the initial border closure between Victoria and New South Wales.
The government of Victoria had a best practice for quarantine management to copy: NSW’s highly successful model. Yet the Victorian Government decided to do something different and we are now weathering the terrible outcomes of that decision.
When Queensland closed its border with NSW early in the crisis the initial implementation was flawed. But after working with key industry groups the process became better managed and achieved what was required, without badly affecting essential products such as fuel and livestock. Yet when the Victorian and NSW border closed, it appears no one contacted Queensland to learn how to manage the closure. That created much concern and took some time to rectify.
So, what else have we learned that should be shared?
Victoria has a lot of learning around the closure of postcodes and then a second lockdown. What have they learned? What worked and what would they do differently?
If we are to build a great economy again as soon as we can, we must share learnings and experiences with each other. Governments must share with industry, and industry with governments. Those in ivory towers who believe they know best need to be shuttered down into basements and cellars.
We need community, full of small businesses and medium businesses, to be empowered to forge a way forward.