Labor has won a resounding election victory, and Kevin Rudd will be Prime Minister. But what does it mean for your business? By MIKE PRESTON.
Labor has won a resounding election victory, and Kevin Rudd will be Prime Minister. But what does it mean for your business?
For all the talk of Rudd’s ‘Me-Too’ campaign’, Labor’s policies on a wide range of issues suggest the Labor Government will usher in some big changes to Australia’s political and business environment.
Rudd has already indicated he is in a hurry to get moving on implementing Labor’s policy program; we are likely to see new industrial relations laws by early next year, and that’s just for starters. Policies on the environment, skills and red tape could all create winners and losers in the business community.
Where do you stand?
The skills shortage
- More skilled training positions: Labor will spend $500 million to 450,000 new training positions – mainly apprenticeships across Australia, 200,000 more than are currently available.
- Skills Australia: Labor will establish an independent statutory body to tackle the skills shortage called Skills Australia. Comprised of seven board members, drawn from a range of backgrounds including economics, industry, academia and training providers. The body will identify where the biggest skills shortage problems are and their causes, and advise the Government on possible solutions and information to employers.
- Trades training centres: $2.5 billion for trades training centres in 2650 schools across the country. Each school could receive up to $1.5 million to upgrade facilities and purchase better equipment for facilities such as trade workshops, ICT labs, training kitchens or graphic design workshops.
- Work training: Labor has committed $84 million over four years to guarantee one day a week on-the-job training, 20 weeks a year, for relevant students and $8 million over five years to improve linkages between schools and business.
- Increased employee leave: Labor will double unpaid maternity leave – and has promised to give both parents the right to take 12 months unpaid parental leave following the birth of a child. If only one parent wants to take leave, that parent has the right to request two years unpaid leave.
- Unfair dismissal changes: Promises to remove the current exemption for businesses with less than 100 employees from unfair dismissal. Labor would implement a fair dismissal code, which it says will be a simple guide to dismissing employees, and promises to remove lawyers from the process.
- Abolish AWAs: Labor says it will do away with AWAs, but existing AWAs will be allowed to continue until they expire, which means valid AWAs will continue to exist until 2013. Employees earning more than $100,000 will be exempt from the award system.
- Fair Work Australia: Labor promises to abolish the Australian Industrial Relations Commission, Workplace Ombudsman, the Workplace Authority and The Australian Building and Construction Commission and give their functions to a new body to be called Fair Work Australia.
- Collective bargaining: Employers will be required to negotiate for collective agreements if a majority of employees vote in a secret ballot to negotiate collectively.
- High earning employees exempt: Employees who earn more than $100,000 will be exempt from the award system, effectively giving them access to flexible work arrangements similar to those provided by AWAs.
- Independent contractors: Labor has recognised that independent contractors should operate under commercial, not employment law, something industry groups have long called for. Question marks remain over whether Labor will retain laws banning union discrimination against independent contractors.
- Franchising changes: Labor has promised to amend the Franchise Code to include good faith obligations, as long as the scope of the obligation is well defined. Will also strengthen the Trade Practices Act with amendments to section 46 dealing with abuse of market power and predatory pricing.
- Minister for red tape: Labor has promised to create a cabinet minister to oversee cuts to business regulation, while a senior official would enforce the cuts and restrictions. The minister will enforce a promised “one in-one out” approach under which a new rule could only be imposed after another is cut.
- Superannuation clearing house: A Rudd Government will also establish a superannuation clearing house to help SMEs deal with choice-of-fund super laws. The clearing house will handle the form filling, checking and distribution of contributions to funds. Business with less than 20 employees would be offered this service free of charge.
- Government tenders: Labor promises to simplify Federal Government tender contracts and reduce commercial risk for businesses performing low-value government contracts to help SMEs access $26 billion in federal government work tendered each year.
- BAS Easy: Labor promises to allow businesses with annual turnover between the $50,000 GST registration threshold and $2 million to be able to opt for a low paperwork GST reporting method.
- Taxpayer funded broadband: Labor promises to spend $4.7 billion to build a fibre-to-the-node broadband network that covers 98% of Australian homes in partnership with the private sector. Promises to run a competitive tender process to run the network on an open-access network that should increase competition in the sector.
Industry, grants and R&D
- Export grants scheme boost: Labor has promised to reform the popular Export Markets Development Grants scheme by:
Boosting funding to the scheme by $50 million in 2009-10, lifting total funding from its current $150 million per year to $200 million.
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Lifting the maximum revenue threshold for businesses eligible to receive grants under the scheme from $30 million to $50 million.
Raising the maximum grant amount for exporters from $50,000 to $200,000.
Cutting the minimum spending threshold from $15,000 to $10,000.
Increasing the number of grants a single company can receive from seven to eight.
- Green business dollars: A $740 million package of new schemes to help businesses develop and commercialise green-tech and reduce their environmental footprint incorporating:
$500 million in grants to businesses to encourage the development and commercialisation of renewable energy technology.
$75 million for SME manufacturers to make their processes more environmentally friendly. SMEs manufacturers will be able to apply for grants to fund up to a third of the cost of greening projects, a minimum of $10,000 and maximum of $500,000 per grant.
$90 million to improve the energy-efficiency of new and existing office buildings. Grants will be available to subsidise up to 50% of the cost of energy saving improvements to a maximum of $200,000 per building.
$75 million in grants to match dollar-for-dollar money spent by businesses to develop and commercialise green products or technologies in any area.
- More renewable energy: Labor will require power companies to source 20% of their energy from renewable sources by 2020, creating incentives for industry development.
- Enterprise connect: $100 million to establish 10 enterprise connect centres around the country. Each centre will specialise in fostering innovation in particular industry sectors and will be supported by Industry Innovation Councils comprising business, government, academic and union representatives.
- Manufacturing network: Advice centres will be established to help manufacturing SMEs innovate through access to the latest research and technology and cut through government red tape. Worth $100 million over four years.
- Grants for family-friendly SMEs: a $12 million program to provide grants of up to $15,000 to small businesses to implement family-friendly measures such as flexible rosters or family rooms.
- Low tax home deposit saving accounts: Labor promises to spend $600 million to create special home deposit saving accounts. First home buyers can make a deposit of up to $5000 per year that will be taxed at just 15%. Another $5000 per year after-tax can also be deposited, with interest from the full sum in the account also taxed at the low 15% rate.
- Personal tax cuts and education rebate: Labor spent $31 billion to match almost all of the Coalition’s tax cut promises. Labor saves $3 billion by not cutting the top 45% tax rate for income earned above $180,000 per year. And $2.3 billion of that money will instead be put aside to allow families to claim a rebate for education-related costs of up to $750 for a child at primary school and $1500 for a child at high school.
What do you think?
Now that Labor is in government, which of its policies should it move on first? What are you most worried about?
Have your say. Email your comments to [email protected]
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