FEDERAL Treasurer Scott Morrison has called an enquiry into the impediments to business investment in Australia.
“Business has told us that regulations are one major impediment to investment, especially in terms of the volume of regulation and compliance costs,” Mr Morrison said. “Businesses find it particularly difficult when they are required to interact with multiple levels of government.
“The Australian Government has cut more than $5.8 billion of red-tape and will continue to search for opportunities to go further, including through the Small Business Regulatory Reform Agenda I announced in last year’s Budget.
“An examination of these and other matters will strengthen our understanding of how the multitude of regulatory systems in Australia affect business investment and assist in the development of a regulatory system that enables growth and supports the ongoing transformation of the Australian economy.”
Late last year, the Council on Federal Financial Relations reviewed the report on the Intergovernmental Review of Business Investment prepared by Heads of Treasuries. The report revealed that investment was driven by a complex mix of factors, including temporary and structural factors, policy settings and institutions.
“I have written to the chair of the House of Representatives Standing Committee on Economics, Sarah Henderson MP, to request that the committee undertake an inquiry into the impediments to business investment in Australia,” Mr Morrison said.
“Business investment is critical to economic growth. When firms are empowered to invest in new productive capacity and technology, it supports innovation and helps create new opportunities and employment for Australians.”
Terms of Reference for the inquiry include the interaction between regulatory frameworks across all levels of government and how the cumulative regulatory burden can be reduced to support greater business investment; the impact of innovation policies, at the Federal and State government levels, on business investment and the role of innovation policies in encouraging greater business investment, considering approaches taken in other countries; the role that taxation policy can have on the encouragement of new business investment; the role that energy policies can have on the encouragement of new business investment; and the impact of supplier payment times, including by governments, on business investment for small to medium enterprise.