A strong economy is every Australian’s business
30 March 2022
The peak body for Australia’s member-owned co-operative and mutual sector welcomed measures in the Federal Budget aimed at balancing the economy towards the interests of all Australians to build back better and fairly.
The budget allocation of $6.9m for the BCCM for a Co-operative and Mutual Enterprises (CME) Support Program to encourage more co-operatives and mutuals in aged and social care would support much needed exploration and investment in business models that are balanced toward the interests of consumers and workers.
“This is unprecedented investment in our models of business that balance business and social objectives and put those who do the caring and those receiving care in charge.”
“The last few years have presented a series of unprecedented challenges to Australia. Floods, bushfires and a global pandemic and volatile trade conditions have each highlighted the importance of building greater self-reliance and resilience into the Australian economy.”
“We have learned from this experience that Australia needs more self-reliance and Australian business needs more resilience. The Budget measures supporting small businesses and regions to thrive would help ensure that we have the supply chain security and resilience to better withstand global shocks, health crisis and natural disasters.
In particular, reforms to make employee ownership simpler and skills, training and digitalisation incentives and funding will help small businesses rebound and recover, employ more Australians and lift wages. Australian people expect more fairness and this is reflected in the halving of fuel excises for 6 months, an increase to the tax offset for low and middle income earners and an extension of home deposit guarantees, although more could be done to support cost of living by decoupling Australia’s dependence on global commodity markets for essential products said BCCM CEO, Melina Morrison.
“Greater Australian national self-reliance can be achieved through more Australian ownership and control in the national interest, across a range of sectors.”
“From health to housing, agricultural to banking, insurance, retail and manufacturing, Australia needs competition between business models not just competition between businesses.”
The importance of control over domestic production is just as relevant in the value-adding of manufacturing as with primary industries.
“We need to grow existing manufacturing businesses and re-establish a larger mid-sized business sector to produce more finished goods onshore.”
“The twin objectives of more value-added manufacturing owned and operated within Australia and the growth of a medium-sized business sector can be delivered through co-operatives so it is vital that the government investments are applied to all business models.”
“The policy, legislative, regulatory and business services environment play important roles in deciding the success or otherwise of businesses.”
Sector/thematic measures at a glance:
Agriculture and regional development
- Work and Holiday visas to be increased by around 11,000, and Skill stream visa places will increase to 109,900, and account for around 70 per cent of the permanent Migration Program.
- Additional funding for the Government’s 2030 strategy, including $6.6 million to extend AgMove program to December 2022 to attract workers to regional areas
- $80 million to provide additional support for small and medium export businesses to re-establish their presence in overseas markets through the Export Market Development Grants program
- $2 billion over 5 years from 2022-23 to establish the Regional Accelerator Program (RAP) to drive transformative economic growth and productivity in regional areas.
Comment: The BCCM will seek further information on the RAP funding as it appears to include allocations across a range of existing programs.
- The Government will expand access to employee share schemes so that more employees at all levels can directly share in the business growth they help to generate.
- Small businesses (turnover of less than $50 million) will be able to deduct an additional 20 per cent of expenditure incurred on external training courses provided to their employees.
- Small businesses (turnover of less than $50 million) will be able to deduct an additional 20 per cent of the cost incurred on business expenses and depreciating assets that support their digital adoption, such as portable payment devices, cyber security systems or subscriptions to cloud-based services. An annual cap will apply in each qualifying income year so that expenditure up to $100,000 will be eligible for the boost.
- Billions in additional skills/training funding.
Comment: The BCCM welcomes any reforms that make employee ownership (as a form of stakeholder ownership in the economy) easier.
- The Government will provide an additional $328.3 million over 5 years from 2021-22 to further support the Modern Manufacturing Strategy and National Manufacturing Priorities (NMPs) and address critical supply chain vulnerabilities.
- A range of measures respond to COVID, floods and other disasters, including
- $150 million in 2022-23 from the Emergency Response Fund to fund recovery and post-disaster resilience measures in the Northern Rivers region of NSW
- $7 million in 2022-23 to expand the Strengthening Business service to provide recovery and resilience advice services in the most flood affected regions.
- The purchase of PPE and RATs for certain workers and community members is noted in the Budget, but was already a well-known measure.
- The Government has extended the measure which enables payments from certain state and territory COVID-19 business support programs to be made non-assessable non-exempt for income tax purposes until 30 June 2022.
Comment: We welcome any member feedback about opportunities or deficiencies in these budget measures – the BCCM continues to engage with governments on the role of our sector in disaster response and recovery.
- $6.9 million over 3 years from 2022-23 to support co-operatives and other collaborative business models access the aged, disability and veterans’ care sectors. The Business Council of Co-operatives and Mutuals will be funded to support the start-up and development of co-operative and mutual enterprises, and deliver business resources and professional support.
- $49.5 million over 2 years from 2022-23 to provide an additional 15,000 low and fee-free training places in aged care courses under the JobTrainer Fund
- Additional measures against each of the Pillars of the Government’s response to the Royal Commission into Aged Care Quality and Safety, including
- $20.1 million over 3 years from 2022-23 to complete implementation of the Australian National Aged Care Classification (AN-ACC) and support the transition of facilities to the new funding model over a 2 year period.
- $10.8 million in 2022-23 for the Cross-Agency Taskforce on Regulatory Alignment to implement the next stage of regulatory reforms across the aged, disability and veterans’ care sectors
Comment: See our media release responding to the measure to support co-operatives and mutuals in social care.
Indigenous business and services
- The Government will provide $21.9 million over 4 years from 2022-23 to support the Australian Indigenous Mentoring Experience to help young Indigenous leaders undertake leadership roles, and for the Office of the Registrar of Indigenous Corporations to develop governance training materials for Indigenous organisations, and to provide scholarships for Indigenous Australians to undertake company directors courses.
Comment: BCCM will engage with Government about these measures being inclusive of Indigenous co-operatives and mutuals in line with our Doing Business Together report.
Housing and financial services
- The Government will increase the number of guarantees under the Home Guarantee Scheme to 50,000 per year for 3 years from 2022-23 and then 35,000 a year ongoing to support homebuyers to purchase a home with a lower deposit.
- The Government will also increase the Government guaranteed liability cap of the National Housing and Finance Investment Corporation (NHFIC) by $2 billion to $5.5 billion.
Comment: These measures will be welcome in the mutual banking and housing co-operative sectors. The BCCM will consult with housing co-operative members on further advocacy opportunities that could build on these measures.