Jennifer Westacott the CEO of the Business Council of Australia gives her reaction to the 2017 Budget
Ross: From there let’s go back to our parliament house studios here. I’m joined by the chief executive of the Business Council of Australia. That represents the top 100 companies in this nation. Jennifer Westacott is with me. Jennifer, many thanks for your time.
Interview with Jennifer Westacott
Jennifer Westacott: Thanks, Ross.
Ross: In regards to this budget, there’s not specifically stuff in there for big businesses per se. There’s a clamp down on the foreign multinationals in terms of their tax. But there’s the big spend in infrastructure which is the key for many of the big businesses.
Jennifer: Absolutely. Look, I think if you take the budget in its entirety, it’s pretty good. I think about the two things we judge it on, does it get spending under control? Does it help grow the economy? On the spending front, caps its spending at 2%. We are a bit worried that there are a lot of revenue measures still. We’re not doing the work on getting the structure of the budget right. It could be slowing the rate of growth in the big spending programs.
Of course, debt continues to grow. On the growing the economy front, the budget’s much, much better to your point. Big infrastructure spending which drives productivity. Which drives jobs. Obviously, the governments committed to its enterprise tax plan which really matters. For Australian companies, it’s mission critical now. We’ve got to do it. There’s good stuff on apprenticeships. There’s good stuff for small business.
I think the point, Ross, is that this budget relies on growth. It relies on the revenue from growth. Business has got to do the heavy lifting. We need the Senate to get out of its gridlock mentality and do everything it can to make Australian businesses more competitive.
Small Business to do the heavy lifting
Ross: Do you think there’s a realistic likelihood that that will occur?
Jennifer: We haven’t seen that. That’s in many respects why we are where we are. Why the budgets are more practical pragmatic budget than a big reforming budget. That’s probably why we’ve got a bank levy which we do not think is a good idea. We’ve got a history of governments overspending. We’ve got a senate in gridlock. Of course, we’ve got now what I think is a very poor policy president to say “Look. We as a parliament can’t get spending under control so we’re going to tax the most successful companies in Australia.”
Ross: Therefore my point to the treasurer will be, the very first question. Have you become a high taxing, high spending government?
Jennifer: You can’t tax. A taxing success is not a great idea. You can’t just pick out one segment of the economy. The question becomes, “Is this going to stop at banks? Are we going to go back to the mining tax?” This idea that banks have got to pay their fair share. The banks that are in question, the five banks, are paying $11 billion in tax.
Ross: But they’re making more than $30 billion in profits.
Jennifer: Yes, of course, they are. But where does [sic] those profits go? They go to their shareholders. They go to superannuation. We’ll be looking at the unintended consequences of this because it will either flow to shareholders or to superannuation. It flows through to business to business lending. People forget what a bank is. It’s actually the engine of the economy. Our banks were the cornerstone of our success during the global financial crisis. We’ve got to be very careful about doing things that weaken them.
Ross: Bearing in mind that the vast majority of the money that the government will raise, $6.2 billion will come from that new levy but call it a tax on the big bank’s liabilities. Jennifer Westacott, the chief executive of the Business Council of Australia. Thanks for joining us this evening-
Jennifer: Thanks very much, Ross.
Ross: – In our budget coverage.
Jennifer: Thanks, Ross.
Ross: We will take a break here. When we come back we’ll try and cover some of those infrastructure spends. Plus, also coming up, of course, the treasurer, Scott Morrison.