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What Australia’s Leaders Are Saying About #Budget2016

By Women For Media | May 4th, 2016

Nicki Hutley, Chief Economist, Urbis

“This budget is a case of fiscal groundhog day. We are seeing the Government move the pieces on the chess board but not actually make significant inroads into the budget deficit.”

“There’s nothing in here that inspires a vision that is going to fundamentally change the Australian economy for the better.” ABC News

“There’s very little here to get excited about. The economic predictions are ridiculously optimistic. We live in an uncertain world and you have to build on conservative forecasts. …as Australians we have to ask, what is it we want from policy and then how are we going to pay for it, because we can’t have increased expenditure and reduced taxes.” World Today, ABC Radio

Andrea Staines, Non Executive Director, QIC, Transport for NSW, SeaLink

“The government’s plan to encourage asset recycling is on the right track with its focus on proper cost benefit analysis for new projects. It was also terrific to see the scope of the program expanded from roads to also include public transport.” Sydney Morning Herald

Professor Miranda Stewart, Director, Tax and Transfer Policy Institute, Australian National University

On the income tax cut for earners over $80,000: “It’s basically a tax cut that benefits the top 20% of female taxpayers and top 35% of male taxpayers by taxable income.”

“If the government was serious about addressing real tax disincentives to work it would have looked at the high effective marginal tax rates facing many women.”

Su-Lin Ong, Head of Australian Economics, RBC Capital

“An improvement in the budget trajectory remains the central forecast but the underlying budget remains firmly in the red.” Sydney Morning Herald

Romilly Madew, CEO, Green Building Council of Australia

“We are pleased to see a renewed national focus on Australian cities, with more than $3.4 billion allocated to urban rail projects. Only then will Australian taxpayers know they’ve invested in infrastructure that is resilient and that delivers the best value for decades to come.”

“It is disappointing that the budget announces no new funding to assist Australia to reach its international commitments for emissions reductions and to transition to a low-carbon economy.”

“The built environment represents significant opportunities for emissions reductions at relatively low cost, but there are no new incentives or support for the property and construction industry, or any other industry for that matter, to make the most of these opportunities.”

“…investment in urban forests is important, but we’d like to see the development of a national green infrastructure policy that goes further than being just about trees, and include boosting biodiversity, enhancing the public domain and building more resilient cities.” The Fifth Estate

Pauline Vamos, CEO, Association of Superannuation Funds of Australia

“We do not support the reduction of annual concessional caps to $25,000.”

“While today less than two per cent of people with superannuation make contributions above $25,000, a significant number of such individuals that have low balances are attempting to catch up. For instance, around 36,000 women with balances less than $200,000 in 2013/14, were making contributions in excess of $25,000.” SMSF Adviser

Belinda Robinson, CEO, Universities Australia

On cuts to the Higher Education Participation and Partnerships Programme (HEPPP): “Cutting such a program means we could be denying talented students a chance at higher education just because of their background. That is not only unfair but it robs Australia of future highly skilled graduates and innovators.”

“To build the highly skilled contemporary workforce of the future Australia needs all Australians – regardless of their background – to have the opportunity to gain the skills required by employers.”

“Improving equity in higher education is not only fair, but an essential platform for building the diverse, skilled workforce of the future.” Guardian Australia

Catherine Robson, CEO, Affinity Private

“There were some welcome incentives, such as the Low Income Superannuation Tax Offset (replacing Labor’s Low Income Super Contribution) and the ability to effectively average concessional contributions over five years, which will assist the self-employed with lumpy incomes and those in the early stages of their career.

However, the reality is that those who have periods out of the paid workforce, or work in low-paid or not-for-profit industries, will continue to find accumulating retirement savings challenging. These people are at a much higher risk of ending their working lives without the security and dignity of independence.” Canberra Times

Dana Fleming, Tax Partner, KPMG

“We strongly support the Government’s measures to allow those with broken work records, often women, to make top-up payments. This is a very fair and important move which will go some way to ensuring those individuals have a decent retirement package.”

“Retaining the Low Income Super Contribution for low earners and allowing tax deductions for all contributions into superannuation are also welcome.” ABC Radio

“Paring back some current concessions – bringing down the 30 per cent tax threshold from $300,000 to $250,000 seems to strike a reasonable balance between equity and incentives for people to fund their own retirement.” Sydney Morning Herald

Australia’s economic future lies to the north

By Angela Mentis | August 31st, 2015

It’s time all of Australia realised our playing field is much bigger than we believe. The reality is it is global, but increasingly centred on Asia and its growing middle class. Every day Australian businesses find more ways to move up the value chain and export our products, professional services and expertise.

Our proximity to Asia provides the Australian economy and Australian business with huge opportunities. Today there are an estimated 500 million middle-class people in Asia. That figure is expected to rise to 1.7 billion by 2020 and to more than 3.2 billion by 2030 when they will account for 66 per cent of the global middle class.

By 2050 it is estimated Asian food imports alone will grow by $US470 billion ($655bn), offering opportunities for huge growth in our agricultural exports. Asia’s share of global output has risen from around 15 per cent in 1952 to almost 30 per cent in 2010, and it is forecast to exceed 50 per cent by 2050.

Volatility in sharemarkets globally in the past week illustrates just how important China’s economy is. Investors are right to be watchful, but it is important we take a long-term view. That’s because the potential is enormous. Are we doing our best as a nation to realise that potential? Are we giving Brand Australia every chance to succeed? Free-trade agreements are opening doors in the region, the falling dollar is making Australian business more competitive, and technology can enable a small business to compete with a big one.

As Australia’s biggest business bank, NAB knows well the opportunity for our customers who are facing north. About half of our institutional banking clients, a third of our corporate clients and one in 10 of our SME clients currently trade with Asia because of the opportunities to grow. Australia is uniquely positioned as more of Asia shifts from “build” to “grow and consume”. While resources remain critical to our future, the burgeoning Asian middle-class wants our services — our expertise in health, education, governance and business, financial and professional services. The demand for agriculture grows daily because in Asia, where food security is paramount, Brand Australia means clean, green and fresh.

Australian businesses growing north include Shepparton-based Pactum Dairy Group which NAB helped introduce to then develop a relationship with China’s Bright Foods and New Hope Group, resulting in a supply agreement for high-quality milk. And then there’s Skybury Tropical Plantation from far north Queensland. Skybury is experiencing growing demand for its single-origin Arabica coffee among coffee lovers in Asia. These are just two of many Australian companies whose futures are being propelled by the Asian demand for Australian produce and expertise.

The opportunity in Asia is not limited to exports. We also see our role for Australian business and the economy as the bridge that extends both ways. Just as the trade flows shift north, increasingly the investment flows are coming south from Asia. I was recently in Hong Kong and Singapore with major clients and institutions who are hungry for opportunities in Australia because of the long-term value. They have the capital to invest and are attracted by our natural resources, stability as a nation and economy; and in particular the huge potential pipeline of infrastructure ripe for investment.

This long-term approach our Asian clients take is something Australia’s political and business leaders must heed, and the National Reform Summit co-hosted by The Australian and The Australian Financial Review last Wednesday is a show of intent. But the hard work is ahead of us. We must think and act long-term if we are to not just talk and plan for the next phase of nation-building but deliver it.

In these pages two weekends ago, The Australian foreign editor Greg Sheridan warned of the risk to Australia’s business reputation posed by the mixed signals sent to investors through decisions such as the cancellation of contracts for the East West Link in Melbourne and campaigns against the China free-trade agreement. My meetings in Asia tell me these investor concerns are real.

The nation must recognise and remember that foreign investment brings new wealth, new opportunity and jobs. That’s why NAB’s submission to Infrastructure Australia’s first national infrastructure audit advocates for certainty over which projects will be developed. NAB argues government policy needs to be formed on the back of an agreed plan of infrastructure priorities, based on transparent cost-benefit analysis. This will help realise priority projects by assuring investor confidence — confidence vital at a time when Australia is competing with other markets for investment.

Corporate Australia has a significant role to play in advocating for reforms to ensure Australia’s long-term infrastructure requirements are met, but this leadership must extend to our elected representatives. A bipartisan and depoliticised long-term approach has the capacity to deliver greater confidence in the infrastructure pipeline, thereby elevating Australia as a preferred destination for offshore capital.

Our future is in facing north. The potential and possibility is there for enduring growth for the prosperity of generations to come. Build Brand Australia and build our nation.

This article was originally published at The Australian.

Sectors: Business, Finance

Retailers to reap the benefits from Budget’s tax break for small businesses

By Sydney Morning Herald | May 13th, 2015

Retailers are set for a sales rush in the wake of a generous tax break for small businesses that will encourage spending on everything from office supplies and computers to fencing and cars.

Diane Smith-Gander, a non-executive director at Wesfarmers which includes Coles supermarkets, Bunnings and Officeworks in its stable, said the measure would likely lead to a “bump” in sales for many retailers.

But to have longer-term economic benefits the money would need to be spent on productive assets that allowed businesses to grow and employ more people.

“You don’t want the small business equivalent of the flat screen TV phenomenon,” said Ms Smith-Gander, who is also chairman of Transfield and president of Chief Executive Women.

“I think this is a bit more generous than people were expecting.”

Ms Smith-Gander said that the budget’s other key focal points – on encouraging greater workforce participation – would only have longer term benefits for the economy if there were also more jobs created.

Segments within retail that could benefit from the measure included car retailers and office supplies, she said, and its impact was likely to appear in business confidence surveys.

Wesfarmers owns some of the country’s largest retailers including, Coles, Target, Kmart, Bunnings, and Officeworks.

While some businesses would be able to fund the purchases from their cash flow, there may also be an increase in demand for bank credit, she said.

“There will be some small business loans, and the banking industry will have to respond quickly.”

“It’s truly amazing,” said Robbie Sefton, who runs a communications consultancy and has just finished a three year term on the Reserve Bank of Australia’s small business advisory board.

“This will definitely create opportunities for people to upgrade that phone system, upgrade software or replace daggy office chairs, it will definitely make a difference.”

Ms Sefton said the measures would have a psychological impact.

“It is a really powerful message about saying ‘don’t give up’,” she said.

Ms Sefton said small businesses would look to grasp the detail of the opportunity which made the explanation of it important.

“If it is packaged up in a way that is simple and communicated well to their accountants they will, they rely on their accountant to give them advice particularly tax advice,” she said.

ANU institute of tax and transfer policy’s Miranda Stewart said the package was very similar to that rolled out as part of the Rudd government’s stimulus efforts in the global financial crisis although, crucially, this package was more generous with a $20,000 cap compared to a $5000 cap in Labor’s version.

She said there was empirical evidence that such programs would stimulate spending.

At the same time there was still an “open debate” about whether that spending was simply the bringing forward to investment that would have happened in future years and now would not, she said.

This article was originally published at the Sydney Morning Herald and was written by Mathew Dunckley and Clancy Yeates.