Economics

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Submission to the Joint Standing Committee on Trade and Investment Growth | February 13, 2018

There is no such thing as the “digital” economy. We need to recognise that there is only the economy in a digital world. Technological change is a constant but it is increasing and will be disruptive to traditional ways of doing things, including the global trade in goods and services.

Australia needs dynamic policy settings that recognise that the increasing availability of access to cloud based computing, high speed broadband, additive manufacturing (3D printing) and the internet of things will all challenge our previous thinking.

Pre-budget Submission | 15 December 2017

The Australian Chamber supports the role of government to ensure the health, welfare and security of the Australian community, recognising that there is an important role for the private sector in providing goods and services to this end, either via government or in its own right. The responsibility is not just to the current generation that a government represents, but also to future generations.

A critical element of the Chamber’s ‘Top 10 in 10 strategy’ (10 steps outlined at the 2016 election focusing on making Australia more competitive) was for policy makers to look over the horizon, past the election cycle and past a government’s current term.

With that in mind, the Chamber calls on government (current and future) and the community it represents, to always be conscious of its legacy. That is, we must be aware of whether we are leaving future generations in a better (or worse) position to face whatever uncertainties circumstances dictate.

The Digital Economy: Opening up the Conversation | Submission to the Department of Industry, Innovation and Science

Australian businesses want to interact with government online. While Australian businesses welcome the government’s intentions to simplify and streamline business interactions with government, the Australian Chamber encourages the Australian Government to do more to support the growth of the Australian digital economy. The Australian Chamber recommends the Government focus on facilitating and driving the rollout of infrastructure that allows businesses to access reliable, fast and inexpensive telecommunications and mobile networks as a priority.

Submission | Independent Review into Regional, Rural and Remote Education | September 2017

The Australian Chamber of Commerce and Industry (Australian Chamber) welcomes this opportunity to comment on an issue of concern to its members. The current disparity in students’ results and outcomes, seemingly in part determined by geographic location, is something that needs to be addressed because the consequences of this disparity extends far beyond the individual student. A graduating student’s successful transition from school to work or further education is a critical objective in order to minimise the economic and societal cost of youth unemployment and negative social and health outcomes for the individual. For regional, rural and remote students poor educational outcomes often have flow on effects to friends and families – which in the case of small rural towns could involve the entire community.

Although this submission will address the two specific terms of reference of the Review, namely the gaps in education achievement and successful transitions, the Chamber’s comments will discuss more broadly the issues concerning regional, rural and remote education within a regional economic and social context.

Submission | Australian Chamber’s Response to the Interim Report of the Black Economy Taskforce

The Australian Chamber welcomes the opportunity to respond to the Interim Report of the Black Economy Taskforce. As acknowledged in the Black Economy interim report, high taxes, a high regulatory burden and low profit margins are the most important determinants of the size of the black economy.

Submission | Payment Times and Practices Inquiry – A Submission to the Australian Small Business and Family Enterprise Ombudsman

The Australian Chamber welcomes the opportunity to provide a submission and acknowledges the submission by the Chamber of Commerce and Industry Queensland.

Australian businesses are trending towards shorter payment times, but there has been a recent deterioration for on-time payment. By international comparisons, Australia is lagging and could
improve.

Submission | Foreign Affairs White Paper

Australia has enjoyed a largely peaceful and overwhelmingly prosperous history over the past 70 years. Our position as a key ally, interlocutor and/or trade and investment partner to some of the world’s largest economies has been reinforced by our capacity to contribute to global initiatives and influence global decisions economically, diplomatically and militarily. But this position will be challenged into the future. Other nations are growing rapidly and will overtake us in global economic rankings over the coming decades, unless policies are adopted in Australia to boost the international competitiveness of our economy.

Australia needs to ensure that we are on a trajectory to regain and cement our position as a leading global economy. Failure to do so creates the risk that we will become less influential in global forums such as the UN, WTO and G20. This will mean that other nations will have greater opportunity than us to shape the global environment within which we and our economic lifelines – international flows of goods and services, capital and people – operate.

Our economy does not operate in isolation but the terms upon which we choose to deal with the world, international trade, welcoming investors and visitors and our efforts to assist others in our region to develop are still within our control. Our submission puts the case to our political leaders, decision makers and policy advisers that we cannot continue to undermine our competitiveness and ignore our decline in global economic rankings and the potential impact that will have on our ability to influence the global environment.

Australia’s position in the world is the product of our history, our reputation as a strong and capable ally and trading partner and the position of our economy among the top 20 nations in the world.  The Australian Chamber has identified policies – our Top 10 in 10 and, more comprehensively, Getting on with Business – that need to be implemented to reverse our slide. The Australian Chamber supports measures to further liberalise markets at home and overseas and we ask for greater involvement for business in the negotiation of trade treaties. Australia has engaged effectively in the Asia Pacific but there remains a vast and largely untapped opportunity within our region, the Indian Ocean Rim. Australia has an opportunity to increase its trade and influence with these nations, and in doing so, develop a balance in our focus on the region.

The Australian Chamber outlines opportunities for Australia to strengthen its brand and its trade and foreign relations capacity. We call on the Australian Government to support the establishment of the Australian Centre for International Trade, centre linking business to research and education institutions in the field of international trade. The Centre will advance Australian interests in international trade and to foster national and international debate on international trade. We encourage the Government to adopt a single national brand, Australian Made Australian Grown, to promote Australian product and services at home and abroad.

We finally call for a strategic approach to aid and climate mitigation that achieves outcomes for recipient countries while firmly acting in Australia’s national interest and protecting our international competitiveness.

Summary of recommendations

  1. Build Australia’s strategic and policy interests in both the Asia – Pacific and the Indian Ocean Rim.
  2. Reprioritise the WTO and support reform of its internal architecture and its ability to deliver meaningful trade liberalisation by removing the requirement for a “single undertaking” in comprehensive trade liberalisation efforts.
  3. Adopt a clear and consistent approach to foreign investment and that the FIRB scrutiny thresholds should be rationalised and applied at a most-favoured-nation (MFN) level for all investors.
  4. Implement Joint Standing committee On Treaties (JSCOT) recommendations 1 and 2 – to involve business and civil society representatives more closely in trade negotiations and assess independently the impact of trade agreements.
  5. Endorse the Australian Made, Australian Grown logo as the common brand for Australian international promotion and re-direct investment away from the current range of alternates across its agencies.
  6. Promote the harmonisation of privacy and data policy between countries, providing certainty and stability for business and reducing barriers for start-ups and innovators. Policymakers must continue to prioritise reducing international barriers to cross-border data transfer and to engage with business and industry leaders as key stakeholders in the development of cyber policy.
  7. Remove Cabotage restrictions for coastal shipping and airlines unless the benefits of the restrictions to the community as a whole outweigh the costs and the objectives of government policy can only be achieved by restricting competition.
  8. Work with neighbouring countries to develop their economies, and ours, in ways that are energy efficient and environmentally responsible.
  9. Continue to engage with the international community to achieve environmentally effective and efficient climate change policies that minimise costs and distribute the international burden of mitigation equitably without compromising Australia’s international competitiveness.
  10. Government partner with the private sector in advocating for “free trade” and should invest $5 million in the development of an Australian Centre for International Trade in recognition of the public benefits that will derive from such a centre.
  11. Encourage improvements in the legal systems of developing countries around the world to support our overseas trade and investment interests.

Submission | PC Review into the Multi-Regulator Model of the Australian Consumer Law

The Australian Chamber welcomes the opportunity to provide a submission to the Productivity Commisson’s (PC) Inquiry into Consumer Law Enforcement and Administration.

The Australian Chamber reiterates its view — as expressed in its June 2016 submission to the Consumer Affairs Australia and New Zealand review of the Australian Consumer Law (ACL) — that
the ACL is working well and provides an appropriate balance between the needs of consumers and business.

Submission | 5 Year Productivity Review

This submission provides ideas to the Productivity Commission to tackle lagging productivity growth.   Following more than two decades of prosperity driven by the mining boom, Australia now faces the real prospect of a sustained decline in living standards. This concern is affecting how businesses invest, as well as how they capture and retain talent.

The Australian Chamber stresses the importance of improving the accuracy of indicators, which will allow for better targeted policy reform, including the incentive structures that will drive growth.

The submission contains recommendations to create better functioning cities that aim to enhance supply chains, connectivity within and between cities, energy productivity and collaboration levels.  It is also proposed that health literacy standards should be improved, adopting international best practice and the Medicare Select model.  The importance of creating more effective public services by improving the public consultation process and improving online services is highlighted.

The Australian Chamber further advocates that productivity can be improved through the maintenance of strong investment in vocational education and training so as to develop future workplace skills, as well as enhancing STEM proficiency and supporting women’s participation by better targeting child care incentives.

Finally the submission includes several recommendations to create more efficient markets including removing the duplication of state and federal regulation, reducing the company tax rate and embracing international engagement through trade investment and the movement of people.

Submission | Enterprise Tax Plan – Senate Inquiry

The Australian Chamber supports the Government’s Enterprise Tax Plan Bill, particularly the progressive reduction in Australia’s company tax rate to 25 per cent for all businesses by 2026-27.

Reducing the company tax rate increases the after-tax return on Australian projects for investors. This boosts investment, which drives higher productivity resulting in stronger profits, higher wages and more jobs. While tax revenue falls due to the lower headline rate, this is offset by revenue gains from increased profits and wages. A lower company tax rate also increases revenue by making it less cost-effective for companies to restructure their operations to avoid paying tax in Australia.

Treasury modelling indicates that reducing Australia’s company tax rate from 30 per cent to 25 per cent would boost Australia’s national income by 0.6-0.7 per cent, including a 0.4-1.1 per cent increase in take-home pay for workers. This boost in living standards should provide compelling support for the Government’s proposed company tax reforms. However, opponents of company tax reform have argued that the results of the Treasury modelling should be disregarded for various reasons. The Australian Chamber’s views on these objections are detailed in the remainder of this submission and summarised in the table below.

Submission | Competition and Consumer Amendment (Competition Policy Review) Bill 2016 – Exposure Draft

The Australian Chamber welcomed the Government’s response to the Competition Policy Review, and the Government’s subsequent decision to accept the Competition Policy Review’s recommendation to amend section 46 of the Competition and Consumer Act 2010 (CCA) to support merit based completion.

As such, the Australian Chamber supports the implementation of these recommendations as outlined in the draft Competition and Consumer Amendment (Competition Policy Review) Bill 2016.

Submission | Productivity Commission Inquiry into Intellectual Property Arrangements

The Australian Chamber of Commerce and Industry welcomes the opportunity to provide a submission on the Productivity Commission’s Intellectual Property Arrangements draft report.

Intellectual property policy can contribute to a more competitive economy, benefiting both businesses and consumers by promoting innovation, productivity and access to markets. Strong intellectual property policy provides an incentive to innovate and prevents others from free-riding without contributing to the costs. However, overly strong intellectual property rules can stifle innovation and prevent valuable ideas from being fully exploited.

Research has shown that protections are most effective at encouraging non-sequential innovation, which is where innovation focuses on single applications. This is often the case for pharmaceuticals. Where innovation is sequential, building on previous intellectual property, protections can restrict innovation. This is particularly relevant in growing fields such as computer technology and telecommunications.

The Australian Chamber believes that Australia’s intellectual property regime balances its conflicting objectives relatively well, but there is still scope for further reform.

In particular, Australia’s intellectual property system presents challenges for small and medium enterprises (SMEs) that often lack the resources to apply for, enforce, or defend their property rights. As a result, SMEs use the intellectual property system far less than larger firms.

The Australian Chamber’s initial submission made recommendations relating to:

  • Compensation for rights holders impacted by reforms.
  • Personal or domestic use of copyrighted material.
  • Introduction of fair use exceptions.
  • Fixed term exceptions (as an alternative to fair use exceptions).
  • Third party use of copyrighted material.
  • Parallel imports.
  • Complexity.
  • Assessment delays.
  • Innovation patents.

While many of the issues raised in the Australian Chamber’s initial submission have been addressed in the draft report, this submission provides further comment on draft recommendations relating to the introduction of fair use exceptions, parallel imports, innovation patents and the complexity of the patent system.

Submission | Annual Wage Review 2015-2016

The Australian Chamber welcomes the opportunity to make this submission to the Fair Work Commission (Commission) as a part of the Minimum Wage Panel’s (Panel) statutory responsibilities to conduct an Annual Wage Review (AWR) each financial year pursuant to Part 2-6 of the Fair Work Act 2009 (Cth) (Act).

Submission | Options to Strengthen the Misuse of Market Power Law

The Australian Chamber supports the full adoption of the Harper Review’s recommended changes.

Australian Chamber Pre-Budget Submission 2016-17

The Australian Chamber has put forward a specific mix of economic reforms, spending cuts and has suggested greater transparency in its 2016-17 Pre-Budget Submission to Federal Government  to create a platform for increasing economic opportunities and improved living standards for current and future generations of Australians.

Submission | Digital by Default Consultation Paper

Submission | Digital by Default Consultation Paper.

Submission | Inquiry into tax deductability

Submission | Inquiry into tax deductability

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