INDUSTRY CHIEF URGES REFORMS
8 July 2013, Written by Greg Evans
WITH the federal election months away, the Australian Chamber of Commerce and Industry chief economist Greg Evans (pictured), advocates for economic policy change.
Few Queensland business operators would disagree that overall demand conditions remain challenging and the latest news on the economy supports this view.
The federal budget is under stress with lower than expected revenue growth, while little has been done to prune back spending. Inevitably this has led to unhelpful signs that business once again will have to plug revenue gaps and face the likelihood of higher taxes.
The official cash rate has fallen to an historic low. This will of course reduce borrowing costs where banks pass on the reduction and will hopefully stimulate greater demand across the economy. However it also underscores the fragility of the domestic economy and it is fair to say a ratcheting back of the Reserve Bank’s much more buoyant view about the economy.
1. Provide for a balanced budget: Strong fiscal management underpins a healthy economy and despite the budget challenges we cannot afford to settle for a vague and ever receding surplus objective. It’s an important economic benchmark that Australia returns to surplus as soon as possible and begins the task of reducing public debt. To achieve the surplus objective, ACCI considers this will require an independent rootand-branch review of government spending.
Author: Greg Evans