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Economy may catch long COVID without support for business in budget

Economy may catch “long COVID” without support for business in budget 

  • • Government urged to provide a range of business support measures in budget. 
  • • The risks of “doing nothing” outweigh the cost of providing business support. 
  • • A CPA Australia spokesperson is available for interview, see Media Contact details. 

The economy may catch “long COVID” unless the government provides support for business in the 2022-23 Federal Budget, according to Australia’s leading professional accounting organisation. But CPA Australia says targeted support holds the key to helping businesses manage future disruptions. 

Ahead of the March Federal Budget, CPA Australia has made a submission to the Australian Government. The key message in our submission is the need for short-term business support and longer-term economic transformation. 

“It’s increasingly likely that many businesses will experience ongoing disruptions for the whole of 2022, and potentially beyond,” said CPA Australia Senior Manager Business Policy, Gavan Ord. “Rolling outbreaks, leading to worker shortages, supply chain issues and reduced consumer spending, may mean that trading conditions wax and wane all year. 

“Accountants are staunch advocates of prudent financial management. Ultimately, the government must balance the cost of providing business support against the benefits and risks of doing nothing. On balance, we think the benefits outweigh the cost. 

“The economy faces its own version of “long COVID” if support isn’t available to help businesses manage future outbreaks. The overall success of measures like JobKeeper and Cash Flow Boost in keeping businesses afloat will be undone if we make good businesses go it alone now. 

“While we’re not opposed to direct financial support in some circumstances, we think the best approach is to use the budget to better prepare business to manage future crises and position them for growth.” 

CPA Australia’s top budget recommendations are: 

1. Support for digital transformation 

“Australian small businesses have one of the lowest levels of digital adoption in the Asia-Pacific, according to our annual Small Business Survey. As online business grows, so does the risk of being overtaken by global competitors with better technology. Other APAC governments have implemented ambitious programs to build small business digital capability. We must too.” 

2. Increase the skilled labour pool 

“Skills shortages were an issue in Australia well before the pandemic. Increasing the size of the skilled labour pool is essential to supporting Australian businesses, jobs and our economy. The budget should increase the number of free or highly subsidised training places in areas with the greatest skills needs.” 

3. Back off on new regulatory requirements 

“Governments put a lot of regulatory changes on hold over the past two years. Now is not the time to play catch up with this backlog. Including fewer new regulatory measures in the budget will give businesses the breathing room they need to focus on current challenges.” 

4. Access to business advice 

“Distressed small businesses often struggle to access advice, even though it could mean the difference between survival and collapse. The government should consider providing financial incentives, possibly in the form of a voucher or grant, to help small businesses access advice from their trusted advisor.” 

5. Economic transformation trumps debt repayment 

“Calls to pay down public debt will inevitably grow louder. In our view, Australia’s net debt is manageable and low by international standards. With our nation confronting economic issues such as weak productivity, an ageing population and climate change, the government’s long-term fiscal strategy should prioritise economic transformation.” 

Read CPA Australia’s 2022-23 Federal Budget Submission 

About CPA Australia 

CPA Australia is Australia’s leading professional accounting body and one of the largest in the world. We have more than 168,000 members in over 100 countries and regions, supported by 19 offices globally. Our core services include education, training, technical support and advocacy. CPA Australia provides thought leadership on local, national and international issues affecting the accounting profession and public interest. We engage with governments, regulators and industries to advocate policies that stimulate sustainable economic growth and have positive business and public outcomes. Find out more at cpaaustralia.com.au 

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