The 2022-2023 federal budget tabled in difficult economic times

Industry bodies hailed the federal government’s first budget for its social reforms, including better access to child care and paid parental leave, which will help families cope with the rising cost of life in an uncertain global economic environment.

“The Albanian government’s first budget was presented against a backdrop of growing global economic uncertainty and growing pressures on the cost of living. Inflation is expected to peak at 7.75% later this year and our economy is expected to slow to 1.5% growth in 2023-24, underscoring the scale of the challenges facing businesses and all Australians,” says Paul Zahra , CEO of the Australian Retailers Association. .

“With many households facing financial hardship, we are happy to see the cost of living front and center. The $7.5 billion package that includes cheaper childcare and expanding paid parental leave will help ease pressure on families and improve women’s economic participation – a key goal for the retail, given that the sector has one of the highest percentages of women in its workforce. We commend the government for undertaking these bold social reforms and for making women and gender equality a budgetary priority.

“The most immediate challenge for retail is the worsening jobs and skills crisis in our sector with over 46,000 job vacancies and one of the few industries to have seen an increase in jobs. vacant in the last quarter. We acknowledge the $1 billion deal to provide 180,000 TAFE and vocational education places in 2023, but seek to hear how these will target traditional retail skills.

“We note that the government is delivering on its commitments made at the Jobs and Skills Summit, including funding faster visa processing times and allowing retirees to earn more without their rights being affected. These are positive steps that the ARA is advocating to attract more people to the country and harness the existing talent that we have here now,” he said. “Many small businesses are facing significantly rising costs, and while we acknowledge the $62.6 million in grants that have been announced to help SMEs become more energy efficient, we would have liked to see more targeted support for help these companies deal with cash flow problems. Continuing instant asset depreciation and increasing tax deductions by 20% for small businesses to upskill employees and support the adoption of new technologies will also help improve digital capabilities and productivity.

“The ARA has hailed paid family and domestic violence leave as another important area of ​​social reform. We also advocated and welcomed $3.4 million over four years to help small businesses understand and implement this legislation.

“The next big disruptor to the Australian retail sector and economy is climate change, and we welcome the resilience measures in this budget to help with climate change and disaster preparedness, as well as changes to support business and community use of the electric car,” he said. “While the retail sector remains resilient overall, we are cautious about the economic outlook as the effects of rising rates interest rates are rippling through the economy and households are tightening their budgets, which could lead to a slowdown in spending in 2023.”

Tanya Barden, CEO of the Australian Food & Grocery Council, said the Albanian government’s first budget focuses on rebuilding Australia’s industry, which has faced extraordinary challenges in recent years due to Covid. -19, natural disasters and global supply chain disruptions.

“The focus of the Albanian government on investment in industry, regional growth and building the skilled workforce of tomorrow is welcome,” said Ms Barden.

“The Government’s $15 billion National Reconstruction Fund is a recognition of the critical importance of domestic industry and sovereign manufacturing capacity for Australia.

“AFGC represents Australia’s $133.6 billion agribusiness industry – the country’s largest manufacturing sector – and we look forward to working with government to help build the strong manufacturing capabilities that will secure the future of the nation.”

Ms. Barden said a number of measures in the budget will support a stronger manufacturing sector, including:

  • $135.5 million over four years, from 2022 to 2023, to develop national manufacturing capabilities and skills, including $17.2 million for a pilot Food Manufacturing Innovation Center in New Wales from South ;
  • An increase in permanent migration levels from 160,000 to 195,000, which will help alleviate the critical labor and skills pressures the industry is currently facing;
  • Supporting regional skills by supporting apprentices in Australian regions and remote areas under the Australian Apprenticeship Incentive System; and
  • Support investments in the regions, where 40% of the food and grocery manufacturing workforce is based.

Ms Barden said: “We need to invest in skills for the future, in a digitalised and advanced, resilient and internationally competitive manufacturing industry.”

Australian Small Business and Family Business Ombudsman Bruce Billson said the budget presented by the Australian government will provide capacity building, mental health support and financial advice for small businesses and incentives to develop, transform and become energy efficient.

Billson said the combined $15 million budget for mental health and financial counseling support was really significant.

“For many small family business owners, their identity is intertwined with their business and the stakes are so much bigger than just a job. Many people have invested their whole lives, and in some cases their family home, in building their business, which amplifies the emotional challenges,” he said.

Mr. Billson said that while this support was extremely welcome, it was partly paid for by redirecting $8 million announced in the March budget for the My Business Future program.

The additional funding for child care will particularly support the growing cohort of women entrepreneurs who have started or led a new business in recent years.

Along with the one-off incentive for older Australians to work longer hours without losing their benefits, this will also help alleviate skills shortages and additional free TAFE and vocational education places will address some of the skills challenges longer term.

“Small family business owners are literally burnt out. They struggle to make rosters work and keep doors open due to labor and skill shortages; grappling with supply issues that mean critical inputs, goods and services are not always available, on the lookout for cybersecurity fears and some battling floods and other natural disasters,” Mr. Billson.

The budget projects inflation to be 7.75% at the end of this year and still high at 5.75% by the middle of next year and 3.5% by the middle of 2024, says small businesses and to family businesses that they will face sustained pressure on the costs of their businesses.

At the same time, fiscal forecasts of weaker economic growth and a rising unemployment rate, as well as the likelihood of further interest rate hikes from the Reserve Bank, show that conditions will be more difficult.

“Small businesses have a proven track record in improving our nation. Remember that coming out of the global financial crisis, almost 60% of new jobs were created by small employers, even though the sector represented only 40% of the workforce,” said Mr. Billson.

“We continue to urge the government to support small businesses and believe that boosting businesses can generate a stronger economy.

“Small business is a dynamic, fast-growing sector that empowers entrepreneurial-minded people to pursue their dreams and energizing this will help increase small businesses’ $438 billion contribution to the economy.”

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