CEDA report points Australia in direction of social, digital, climate investments

GOVERNMENTS should seize opportunities that deliver long-term economic and social benefits to secure Australia’s recovery from the COVID-19 pandemic, according to CEDA’s 2021 Economic and Political Outlook (EPO) report. 

CEDA chief executive Melinda Cilento said COVID-19 "has taught us we do better when we are bold" . Investments in social infrastructure such as childcare, aged care and housing should be high on the list, she said.

Australia should also build on the momentum of 2020 in the digital and data space by improving data sharing and linkage, to underpin evidence-based policymaking, Ms Cilento said.

“A key message from the economic contributors to this report is that despite periodic outbreaks of the virus, confidence and economic activity has been incredibly resilient,” Ms Cilento said. 

“Australia remained resilient by taking bold steps on health and the economy – 2021 will be no different.

“A rapid and widespread vaccine rollout will be crucial to maintaining recent momentum. In 2021, everything will flow from this, especially as governments wind back income support such as JobSeeker and JobKeeper that kept much of the economy afloat last year.

“The government should not be afraid to provide continuing support to the hardest-hit industries and individuals to support jobs and incomes, ensuring that the recovery is not derailed.”  

Australia’s openness to the world has come under increasing pressure and will be an important watchpoint as COVID-19 recedes.

“We must ensure our migration program emerges stronger, to support the recovery,” Ms Cilento said.

Some key policy debates are already re-emerging, although growth and jobs will dominate this year. 

“Climate change should be front of mind, given its business, economic and social significance, as well as the global policy shifts driven by the new Biden Administration in the United States,” Ms Cilento said.

“The Federal Government is moving towards committing Australia to net-zero emissions by 2050.

“Embracing that goal as soon as possible, and outlining more ambitious policies to get Australia there, would build confidence among business and the broader community.”

Another theme is the need to address inequality, which ANZ chief economist Richard Yetsenga said had been rising across many parts of the globe. Lower-paid roles are bearing the brunt of job losses in many nations, and the inequality implications of this will be one of COVID-19’s more important legacies.

“To address inequality in Australia, a permanent increase to the rate of JobSeeker is long overdue,” Ms Cilento said.

“It will do much to support the recovery, and as Reserve Bank of Australia Governor Phillip Lowe has said, it is a fairness issue.”

There are clearly many question marks hanging over this year. CEDA’s Economic and Political Outlook (EPO) 2021 provides valuable analysis to help policy makers and business respond to these issues.

This analysis will be complemented by a keynote speech by Australia's Ambassador to the US, the Arthur Sinodinos, who will share his insights into the US-Australia relationship, at the launch of the report.

The 2021 EPO will be launched at a two-day digital forum today  from 11am to 12.30pm and tomorrow, February 17, from 11am to 1pm (AEDT).

The economists and journalists who have contributed to this report are:

  • Political outlook: Phillip Coorey, Political Editor, Australian Financial Review
  • Domestic economic outlook: Alan Oster, Group Chief Economist, NAB
  • Policy outlook: Cassandra Winzar, Senior Economist, CEDA
  • International economic outlook: Richard Yetsenga, Chief Economist and Head of Research, ANZ Banking Group

In addition to the authors, speakers include Australia's Ambassador to the United States, Arthur Sinodinos, in conversation with ABC Insiders host David Speers; Griffith Asia Institute director, Prof. Caitlin Byrne; ANU Australian Centre on China in the World director, Prof. Jane Golley; ABC RN Breakfast presenter, Fran Kelly; and Asialink Business chief executive Mukund Narayanamurti.

Download the report here


Major review of Sydney's city centre planning - Clover Moore

THE MOST DETAILED planning review of the city centre in more than four decades is set to play a critical role in Sydney's recovery from the impacts of the Covid-19 pandemic. 

Lord Mayor Clover Moore said the City of Sydney’s Central Sydney Planning Strategy provided a long-term vision that would promote job creation and economic growth, "while protecting the inner-city’s heritage and public spaces".  

“By providing for buildings taller than 300m and creating increased employment space, while ensuring high-quality design and protecting our important public places, this strategy provides a vision for the city’s commercial, residential and recreational future,” Cr Moore said.

“Our communities, businesses, landowners and industries have all had the opportunity to contribute to the development of this strategy. It will help us lay the foundations for the city’s recovery from the devastating economic and social impacts of the coronavirus and maintain Sydney’s status as an attractive place for business investment. 

“Following extensive consultation and three years of block-by-block research, we are proud to present this blueprint for planning done well – allowing the city to grow with new skyscrapers that will also ensure sunlight continues to shine on treasured public spaces such as Hyde Park, the Royal Botanic Gardens, Martin Place and Wynyard Park. 

“This is about strengthening public open space, accessibility and connections to make moving around the city easier and more enjoyable for workers, residents and visitors. The new strategy uses extensive evidence-based work and considers the current and future needs of our city. 

“We will protect, enhance and expand Central Sydney’s heritage, public places and open spaces for all to use and enjoy," the Lord Mayor said.

“If we want Sydney to maintain its status as an economic powerhouse of innovation and collaboration, it’s vital we safeguard economic floor space while allowing residential development to continue in the city centre.”  

After community consultation and feedback during the public exhibition, the City has made changes to the planning framework. These include: 

  • phasing out the incentive for residential development of additional floor space over two years;
  • saving time by allowing a project to proceed to a detailed design development application (stage 2) based on the approval of the concept design;
  • excluding the northern part of the Kent St tower cluster around Gas Lane, which is a transition area between the residential character of Millers Point and the commercial centre;
  • removing the proposed additional 30m in height control in the same northern Kent Street area;
  • updating guidelines for site-specific planning proposals in central Sydney to allow landowners to lodge planning proposals.

To ensure local infrastructure keeps pace with growth, the council will ask the Minister for Planning and Public Spaces to amend the regulations to allow for a contributions levy of up to 3 percent to apply to new development. 

"This increased levy will fund new infrastructure to support the increase in floor space in the planning proposal and ensure Central Sydney remains an attractive place for investment," Cr Moore said.

She said other key elements of the strategy include supporting emerging designers and architects and promoting more women into design leadership roles to ensure central Sydney’s ongoing growth, success and equity.



Brisbane City charms shoppers back to help boost COVID-struck retailers

RETAIL discounts, live music, fresh food and chilled drinks are all part of a three-day Brisbane shopping festival that aims to boost CBD businesses and encourage local and visitor support.

Brisbane Lord Mayor Adrian Schrinner said the popular Shop BNE City is returning for three days starting this Friday, tempting shoppers back to the Queen Street Mall as it continues to rebuild following the economic impacts of the global coronavirus pandemic.

“Queen Street Mall was one of the shopping precincts hardest hit by coronavirus, with a severe downturn in foot traffic hurting inner-city traders,” Cr Schrinner said.

“Shop BNE City is bringing out all the stops to encourage residents and visitors to head into the city to dine, drink and shop with a whirlwind three-days of exclusive retail discounts, pop-up bars and live entertainment. 

“To ease the holiday blues, Next Hotel will open its pool up to the general public, transforming into an urban oasis with live music and food and drink offers, while Jimmy’s on the Mall will transform into an Italian-inspired garden," Cr Schrinner said.

“Queen Street Mall will feature retro themed departure lounges, while the Wintergarden will put local musicians front and centre at the City Sounds Live Music Stage.”

Cr Schrinner said Shop BNE City was now entering its fifth year, but believed this year was "the most important event to date".

“Our local businesses are crying out for support and as a city we need to all do our part and buy local,” he said.

“Coronavirus forced many businesses to shut their doors earlier this year, but their doors are back open and they are ready to welcome people back.

“Events like this are a great incentive to draw people back into our retail and entertainment precinct and to give our local traders the support they need and deserve as they get back on track post coronavirus," Cr Schrinner said.

“With Christmas around the corner, this is a perfect time to get organised and get in early to do some Christmas shopping and take advantage of over 70 exclusive offers that will be available over the three-day event.

“I encourage everyone to pencil this event into their diary and head into the CBD. There’s so much on offer and it could bring the financial boost so many of our businesses desperately need right now.”

Shop BNE City will be held from Friday October 30 to Sunday November 1. 



Business Growth Fund breakthrough to assist high growth potential SMEs

THE formal establishment of the Australian Business Growth Fund is "excellent news for high growth potential SMEs" according to Australian Small Business and Family Enterprise Ombudsman, Kate Carnell.

The Australian Business Growth Fund, as recommended in the Ombudsman’s Affordable Capital for SME Growth report, will allow established small and medium enterprises (SMEs) with annual revenue between $2 million and $100 million, to apply for long-term equity capital investment of between $5 million and $15 million.

“Today’s launch of the Australian Business Growth Fund is fantastic news for high growth potential SMEs who require essential long-term equity finance to flourish,” Ms Carnell said. 

“The fund will fill the critical gap, identified in our Affordable Capital for SME Growth report, for patient capital to enable our up-and-coming SMEs to succeed.

“While businesses need to demonstrate three years of revenue growth and profitability, there are allowances in place for the impact of the COVID crisis on recent business performance," Ms Carnell said.

“Importantly the fund has appointed Anthony Healy as CEO and Will Hodgman as chairman and will be managed by private sector expertise. 

“Minority shareholding of between 10 percent and 40 percent will enable these promising businesses to retain control of their company, while providing the funds they need to invest in growth.

“Similar models in the UK and Canada are tried and tested – overcoming barriers to accessing affordable capital for businesses that have gone on to demonstrate successful growth," she said.

“We welcome both the Federal Government investment in the fund, along with the major banks and financial institutions’ contribution.

“The fund is valued at $540 million and we welcome the ambition to grow the fund to $1 billion as it matures.

“In supporting our high growth potential SMEs, the Australian Business Growth Fund will play a significant role in encouraging business growth and economic recovery at a time when we need it most.”




Qld Government to spend $5 million on Bowen Basin gas pipeline study Blue Energy

BLUE ENERGY Limited has commended yesterday’s announcement by the Queensland Premier, Annastacia Palaszczuk, that the Queensland Government would invest $5 million in a concept study to investigate the feasibility and options for a new transmission pipeline south, to connect the Bowen Basin’s gas reserves to the east coast of Queensland.

The commitment was contained in yesterday’s release of  the Queensland Economic Recovery Plan by the Premier.

Blue Energy has regularly commented on the enormous gas resource that has already been discovered in the North Bowen Basin. This basin has been producing gas north to Townsville manufacturers and electricity generators via the 273mm diameter North Queensland Gas Pipeline, since 2005.

The Bowen Basin contains independently verified (ACCC Jan 2020) gas resources of up to 15,000 petajoules (PJ) which, if fully developed via a new southern pipeline, could supply the east coast domestic gas market for up to 30 years.

Blue Energy said in doing so, it would act to lower east coast gas prices to end users, and importantly, enable manufacturers and gas users to enter long term gas contracts and give certainty of gas supply and price, for decades. This in turn would encourage expansion and growth of existing manufacturers and entry of new manufacturers to establish themselves in Queensland. 

This will mean more jobs in Queensland, Blue Energy managing director John Phillips said.

"Gas is not only used for low emission electricity generation, but is essential as a feed stock for the manufacture of pharmaceuticals, plastics, explosives, bricks, glass, fertilizer, PPE, and many more products, all of which are integral parts of the modern economy," Mr Phillips said. 

Brisbane based Blue Energy has 3,000PJ of gas resource in its 100 percent owned tenements around Moranbah.. It currently has Production Licence Applications with the Queensland Government with the view to supply gas into the domestic markets, both into Townsville and to the south, once the southern pipeline is built.

"Along with extending a lifeline to struggling Australian east coast manufacturers and helping rebuild the economy, post the COVID induced economic contraction, long term gas supply from the Bowen Basin will be critical to firm up the large renewable energy project roll out mandated in Queensland," Mr Phillips said.

"This will not only provide reliable dispatchable synchronous firming generation for the 50 percent renewable generation target set by the state, but could also provide a significant portion of the other 50 percent of electricity generation that is not renewable, and give the workers currently in the coal fired generation sector a 'just transition' to gas industry jobs.

"Blue looks forward to additional detail on the scope of the Bowen gas pipeline study being proposed by the government, and stands ready to assist," Mr Phillips said.


HomeBuilder scheme a 'massive relief' to tradies - Master Builders

MASTER BUILDERS Australia has come out strongly behind the Federal Government’s new HomeBuilder scheme, saying it "will be a massive relief to the thousands of home builders and tradies around the country". 

“HomeBuilder will be a lifeline for an industry facing a valley of death in the coming months. It will mean more new homes, more small businesses and jobs are protected and provide a stronger bridge to economic recovery for our country,” Master Builders Australia CEO Denita Wawn said.

“Based on the government’s estimated 27,000 grants, we think the scheme will be used for $10 billion in building activity, supporting the viability of 368,000 small builders and tradies – the businesses which employ 800,000 people in communities around Australia,” she said.  

“Supporting the home building industry is essential to strengthening the economy and helping Australia recover from the impacts of the pandemic. Residential building activity gives back more than double to the communities that sustain it with every $1 invested in home building activity providing $3 to the wider economy.  

“This means that HomeBuilder will provide a boost for thousands of tradies; the cafes, pubs, and ute dealerships that they frequent; as well as the thousands of building supply businesses that depend on the industry,” Ms Wawn said.  

“The scheme is well targeted and should maximise the number of builders, tradies, workers, apprentices and households that will benefit.

 “The Government has listened to Master Builders call for HomeBuilder to include grants for both new home builds and renovations. EY modelling commissioned by Master Builders shows that this stimulus mix will deliver the best return on investment for taxpayers.

“The eligibility criteria mean that the vast majority of Australians will be able to access the scheme. More than 80 percent of households have income of $200,000 or less.” Ms Wawn said.  

“The scheme is structured to get building activity going immediately and to provide safeguards around quality and consumer protection. Making HomeBuilder grants accessible through state and territory channels should streamline its rollout and building work must be carried out by a registered or licensed builder.

“The lag effect of building activity means that HomeBuilder comes just in time for builders and tradies staring out at a valley of death with forward work for the next 6 -12 months fast evaporating,” Ms Wawn said.  

“The building industry is simply too important to the economy and living standards to allow to collapse. It is the nation’s second largest industry, provides the most full-time jobs, trains the most apprentices and is 98 percent made up of small businesses.

"Master Builders welcomes the government’s HomeBuilder scheme,” Ms Wawn said.



Building industry calls for a $13 billion stimulus action plan

A $13.2 BILLION building and construction stimulus action would drive over $30 billion in new economic activity and create more than 100,000 new jobs across the economy, according to new EY economic modelling commissioned by Master Builders Australia.

Denita Wawn, CEO of Master Builders said, "We are seeking stimulus not subsidies from government. We want National Cabinet to urgently implement this independently modelled stimulus package and establish a special task force to fast track commencement of construction activity.”

EY modelling shows that a $13.2 billion investment by governments in a Master Builders proposed stimulus package would mean:

  • $30.9 billion in GDP from the $13.2 billion investment;
  • Creation of 105,500 jobs in construction and across the economy;
  • $17.6 billion in expanded construction activity (new dwelling starts, renovations and commercial construction activity).

"Building and construction is shaping up to be one of the industries worst hit in the long term by the COVID-19 economic crisis. We know from previous downturns that it takes four times longer for our industry to recover than the rest of the economy,” Ms Wawn said. 

"This economic crisis is not the result of a market failure; it is the result of the lockdown imposed by governments in response to the public health emergency of COVID-19. We are asking our political leaders to show the same courage and vision in supporting our industry as they showed in responding to the health emergency,” she said.

“Work for builders and tradies in 2020/21 is fast evaporating and the indications are that 2021/22 will not be much better. There is no time to spare in meeting this threat to the viability of nearly 400,000 building business and the jobs of 1.2 million people employed in our industry.

“We also want to see a dedicated building and construction industry taskforce established to oversee the implementation of the stimulus action plan. For stimulus to occur building activity needs to commence," Ms Wawn said.

"Builders and tradies cannot sustain their businesses and jobs on promises. We have seen that governments can fast track construction activity in response to natural disasters and COVID-19 is shaping up as an economic disaster."

EY was commissioned to model a stimulus package comprised of the following programs:  

A $40,000 uncapped the new home building grant.

  • $17 billion in additional economic activity resulting from $5.2 billion investment by government.
  • The creation of 58,311 jobs right across the economy almost replenishing the 77,580 jobs lost in construction since the start of the Covid-19.
  • Delivering 14,000 extra new homes. 

Resilience renovation program (funding for renovations to make homes resilient to natural disasters or to make homes more accessible).

  • $7 billion in economic activity for $4 billion investment by government.
  • Creating 24,036 jobs.

For commercial programs (programs including funding for cladding/asbestos rectification, a10% drop in developer charges, 5% increase in government spending in health, defence and education)

  • · $6.8 billion in economic activity for $4 billion investment by government.  This excludes wider economic benefits in relation to health, safety and building quality.
  • Creating 23,118 jobs.



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