Action-oriented State and Federal Budgets needed to lift business sentiment

DESPITE a busy Christmas and New Year trading period, the first quarter of 2016 has been a challenging one for many Victorian businesses, according to the Victorian Chamber of Commerce and Industry’s latest Survey of Business Trends and Prospects.

Victorian Chamber Chief Executive Mark Stone said the survey, which captures the views of over 450 Victorian businesses, shows trading conditions were comparatively subdued in the first three months of 2016.

“Compared to the previous quarter, respondents to the survey reported a fall in exports, sales and profits.  Wage and labour on-cost pressures such as WorkCover premiums, payroll tax and penalty rates also continued to hit many businesses hard,” said Mr Stone.

“With seven of Victoria’s 13 public holidays taking place in the first quarter of the year, it is not surprising that many businesses were affected by higher operating costs, squeezing already tight cash-flow positions.”

Mr Stone said despite these difficulties, 22 per cent of respondents are anticipating stronger growth in both the Australian and Victorian economies over the next 12 months.

“Victorian business sentiment is positive, but it is also very fragile in the current economic environment.  What is needed is action to lift business sentiment and activity levels,” said Mr Stone.

Mr Stone said the forthcoming State and Federal Budgets provide a timely opportunity to do so with business-friendly initiatives that increase competitiveness, reduce business costs and create jobs.

“This is why the Victorian Chamber’s State Budget submission calls for practical measures to drive business growth such as an increase in the payroll tax threshold, a reduction in the average WorkCover premium rate, new productivity enhancing infrastructure and reforms to improve the quality of the state’s education and training system.”

For more information about the survey, please visit the Victorian Chamber website.

The Victorian Chamber of Commerce and Industry, established in 1851, is the most influential business organisation in Victoria, informing and servicing more than 15,000 members, customers and clients around the state.

victorianchamber.com.au

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