The State Budget was handed down on 3 May, please click here for our official response.
Relative to many other States, the Victorian economy is strong, but it could be stronger.
Business competitiveness is fragile and under pressure from influences on the domestic front, and abroad.
With the New Year and new State Government comes a timely opportunity to refocus Budget settings and reassess core objectives in order to build long-term, sustainable growth.
We have a sound base to build on. Victoria’s greatest assets are its resources: its communities and their workforces, our diversified industry base and natural assets, our education system, modern infrastructure and well-developed links to key markets.
Responsible, pro-business economic and fiscal management has been a hallmark of State economic policy over the past two decades and bodes well for today’s decision makers whose task is to meet a number of pressing challenges, including:
- Stiffening international competition
- A persistently high Australian dollar
- Rising interest rates and difficulty accessing finance
- An ageing workforce and waning productivity
- Persistent skills shortages
- The damaging impact of natural disasters
- Higher insurance and rising utility costs
- The transition to a lower carbon economy and the effects of climate change
- An ageing infrastructure stock
- Managing the pressures on our health, education, housing and transport systems associated with population growth.
For these reasons, complacency in public policy-making must be avoided.
At the outset, we recognise the significant fiscal task confronting the Coalition Government in meeting its commitments to help Victoria and other states recover from the impact of floods. Welcome support to business and flood-affected communities is underway.
However, recent events at home and abroad suggest more rather than less demand will be placed on Governments to help rebuild damaged infrastructure and lost productivity. It is therefore time public policy turned its attention to developing permanent solutions to addressing the economic and social costs of natural disasters.
We also take this opportunity to state our strong support for the overarching direction of economic and industry policy that the new Coalition Government has committed to in its first term. Many of the policy initiatives are consistent with VECCI’s policies and advocacy.
Particularly welcome is the emphasis on transparent, accountable and responsible economic and fiscal management. Equally important is the commitment to review – and reduce where possible – State taxes and red tape as well as foster improved infrastructure and strengthen industry and workforce competitiveness.
The 2011-12 Budget provides a timely opportunity to both progress and add to these reform directions. In doing so, it is critical that the Budget recognise the role and importance of Victorian business in creating and sustaining wealth, investment and employment. All Victorians and the quality of their lives benefit from a strong and vibrant business sector.
If there is a priority it must be to lift productivity and productive capacity. Our living standards and competitive standing depends on it. On this task both business and Governments can and must continue to make significant contributions.
On this page, you’ll find VECCI’s proposal to solve Victoria’s future challenges in the following areas:
- Keeping Victoria’s finances strong
- Business tax reform and why it’s needed
- The need to accelerate regulation reform
- Closing important infrastructure gaps
- Enhancing our workforce’s skills base
- Successfully transitioning to a low carbon economy
- Lifting tourism and events industry competitiveness
- New directions for regional prosperity
As a State, we have a good base to work on – but we need to press with the reform task. The growth momentum must not only continue, it must broaden and deepen.
The 2011-12 State Budget can transform opportunity to prosperity through carefully designed policies that improve business competitiveness. The implementation of reforms in the areas listed above will set the foundation for accelerated growth, new investment and renewed job creation in 2011 and beyond.
To learn more about VECCI’s advocacy activities, please visit VECCI’s advocacy homepage.
