Event:  Andrew McKellar’s speech to the ACCI 2024 Gala Dinner

Date: Wednesday 6 November 2024

Topics: ACCI network, budget issues, company tax rates, small business

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Andrew McKellar:

Thanks to Bradley Bell, Ngunnawal Elder, for his generous welcome.

There are many joining us this evening I’d like to acknowledge, including the Prime Minister, Ministers, The Hon. Paul Fletcher who is representing the Leader of the Opposition, Shadow Ministers, MPs and Senators, Excellencies, the ACCI President and Board Members, our sponsors – Amazon, Intuit, Asuria Australia, and the Australian Made Campaign. Business NSW – with a delegation of around 60 participants from their extensive network. Chemistry Australia – with their Young Leaders delegation. Insurance Council of Australia – also here with their own delegation.

The ACCI network is the largest and most representative business grouping in Australia – covering small, medium and large businesses.

But we do not stand alone. On many occasions we work side-by-side with other organisations to advance the interests of Australian business.

Most recently, ACCI participated as part of broad coalition of business groups concerned about the far-reaching impact of changes to workplace relations laws.

I acknowledge the leading role that the Minerals Council of Australia played in that process. MCA Chief Executive Tania Constable could not be here this evening, but Deputy CEO, Sid Marris is – and I also warmly welcome Geraldine Slattery, President of BHP Australia and an MCA board member.

I would also like to give a call out to the CEO of the Business Council of Australia, Bran Black. We warmly acknowledge the constructive working relationship with the BCA and the common vision that we share for a productive, competitive and prosperous Australia.

Ladies and gentlemen,

At ACCI our aim is to make Australia the best place in the world to do business.

We have much to be proud of, but we also see challenges which must be addressed if we are to achieve our competitive potential and keep the economy operating at, or near, full employment.

We face an issues rich environment. At ACCI, we relish the opportunity to take a leading role in the national conversation about the economic challenges that we face and the agenda for the future.

I want touch on a few key priorities following a day of robust discussions at our Business Leaders’ Summit.

Tax and fiscal reform are central to our agenda to boost productivity and competitiveness.

The Government has delivered back-to-back budget surpluses – it is a significant achievement and one which deserves the full acknowledgement of the business community.

But already we face a renewed challenge. The projected return to structural deficits is a serious threat to the progress that has been achieved to reduce inflationary pressures.

Government spending as a share of GDP is rising again. We firmly believe spending must be held at a level below 25 per cent of GDP.

We commend the Government for its recent efforts to reform the NDIS and aged care services – these reforms (which were ultimately achieved with bi-partisan support) will certainly help contain the burgeoning costs in these critical areas of service delivery.

A healthy underlying budget position is a necessary pre-condition if we are to have any hope of undertaking fundamental tax reforms that will help to grow “the size of the pie”, rather than simply re-distributing “the share of the pie”.

There has not been a serious attempt at tax reform for more than a quarter of a century. As a nation, we must urgently summon the courage to take this on again.

At ACCI, we believe the company tax rate should be cut to 25 per cent for all businesses. With the company tax rate at 30 per cent, Australian businesses are becoming less and less competitive with their OECD counterparts, where the average corporate tax rate is now closer to 20 per cent.

We want the instant asset write-off threshold to be increased to $50,000 and made available to businesses with a turnover of up to $50 million, and to make it a permanent feature of our tax system.

The benefits of the write-off have been amply demonstrated in recent years, but the farce of last-minute yearly renewals needs to be replaced with an approach that builds certainty and confidence.

Small business is a core constituency for ACCI.

Earlier this year ACCI conducted its Small Business Conditions Survey, which revealed some deeply concerning trends:

• 82 per cent of respondents considered that the growing burden of compliance was a significant issue.
• 61 per cent of small businesses had experienced an increase in the level of red tape over the past twelve months.
• Notably, 45 per cent of small businesses said they had considered closing their doors over the same period.

When we dig into their responses, we learn more about the sources of this stress for small business owners.

As always, the burden of tax compliance is an overriding issue.

But many small businesses are also expressing concern about recent changes to workplace laws:

• changes to the definition of employment and arrangements for casual employees,
• confusing new arrangements for independent contractors,
• new powers for union delegates and increased rights of access,
• the right to disconnect, and
• higher wage claims, not backed by increases in productivity.

The list of changes is far-reaching and can add the expansion of requirements under the Privacy Act, pay day super, and ambit claims for new leave entitlements, a challenge to junior pay rates and even more.

To help ease this burden we have proposed that the definition of a small business in the Fair Work Act should be increased from less than 15 employees, up to 25 employees – freeing many small businesses from the adverse impact of regulation over-reach on productivity and jobs.

The response from the ACTU and trade unions has been predictable, but wholly false and misleading.

Our motivation is to make it easier for small business to grow, to create jobs and to ensure economic security for more Australians.

We urge all parties to get on board and to offer a fair deal for small business.

There is much more that I could say.

I could address the overriding importance of skills and training as a vital part of our strategy to reinvigorate productivity growth, and the importance of international education as our leading services export.

I could reinforce our commitment to pursuing a path to net zero emissions, with ambitious but realistic targets to 2035 and beyond. A pathway which ensures that households and business will have access to reliable and affordable energy solutions, driven by two things: the science, and the economics.

For now, there is one final point that I will leave with you.

Ladies and gentlemen,

We come together at a time when many of the fundamental values and benefits that business brings to the Australian community are under assault.

A divisive and false narrative is being peddled by some in the trade union movement, those on the extremes of the political spectrum (such as the Australian Greens), and a few similarly aligned social activists.

Views on the contribution of business are driven by perceptions of big business, and immediate associations with ‘big business’ are often wrongly negative.

Such views are not only harmful to big business, but they are also damaging to the interests of all business.

In many cases support for policies which are anti-business is all too easily manipulated by lazy and populist views from across the political spectrum.

If you take no other point from my comments this evening, take this – it is time for business to take a stand, to push back, to clearly articulate the contribution that business makes and the resulting benefits for individuals and communities.

We can ask who can take responsibility and work to change this situation? Ladies and gentlemen – it is us – the Australian business community!

No single business group can do that in isolation, we must work across a broad front. Many of those allies are here in the room this evening.

Combined, the leading business organisations have a powerful voice. We have a critical opportunity to work together to re-frame the debate and to reinforce the reality that strong business leads to rising living standards for all Australians.

This is my call to action!

For now, please enjoy your entrée.

In a little while we will hear from ACCI President, Mark Birrell, who will introduce our guest of honour, the Prime Minister of Australia.

Thank you.