BUSINESS experts and economists expect a rise in the number of business insolvencies, according to Australian comparison website Finder, following on from the conclusion of JobKeeper payments at the end of September.

In tthe latest Finder RBA Cash Rate Survey – the largest of its kind in Australia – 43 experts and economists weighed in on future cash rate moves and other issues related to the state of the Australian economy. 

While all experts surveyed expect a cash rate hold in July (43/43), those who weighed in on insolvency (19) foresee an average of 805 businesses folding after government aid dries up in September. 

Several investment and credit-reporting firms have warned that 'zombie companies' – those kept alive only by pandemic stimulus – could collapse over the next six months as stimulus measures are reduced.

According to CreditorWatch, around 550 insolvency actions were issued in April and May this year due to government stimulus relieving some pressure.

Finder insisghts manager, Graham Cooke said many more are on the way this quarter.

“At this point, it is more of a question of ‘when’ than ‘if’ many companies become insolvent," Mr Cooke said. “Referring to them as ‘zombies’ kept alive only by taxpayer money is a convenient way to remove the human component of the coming pain.

“The people affected will not be the undead, but they will be those who were trying to cross the so-called ‘bridge to the other side’ only to find that they ran out of time,” he said.

Mr Cooke noted that around 800 insolvency actions were initiated in both February and March. 

“Economists aren’t predicting an enormous influx of insolvencies right away in September, but the 800 prediction is deceptive because many expect the worst to come in the months that follow,” Mr Cooke said.

Rebecca Cassells from Bankwest Curtin Economics Centre actually predicted a drop in insolvencies in September to 450, but said this is more due to scheduling than optimism in the viability of Aussie companies. 

“We will likely see a spike in the number of insolvencies in October and November as supports are removed,” Ms Cassells said.

Saul Eslake of Corinna Economic Advisory, who also predicted a drop in insolvencies, said the same.

“I think banks and other creditors will hold off pursuing insolvency cases until after the debt service payment moratoria have expired (which isn't until the end of September),” Mr Eslake said.

Rich Harvey, the CEO and founder of Propertybuyer, said he expected 1,400 insolvencies in September.

“Many companies will not be able to sustain their cost base without government support and low revenue,” Mr Harvey said.


Only about 4 percent of experts surveyed by Finder predicted  Donald Trump would be re-elected as US President in November.

Only one out of 27 experts who weighed in (4%) predicted a Trump victory in November.

Nearly 3three in five (59%) predicted that Joe Biden would become the 46th president of the United States, with 37 percent saying it iwas too close to call.

“The politics and attitude of the leader of the US has huge implications for the Australian economy, global trade and the value of the Aussie dollar around the world," Mr Cooke said. “With many traditional conservative voices now joining the Democrats in calling for an end to Trump’s tumultuous administration, our survey shows that Aussie economists have little faith in Trump securing re-election.

“While the initial actions from the White House resulted in a surge in the US stock market, Trump’s performance combating COVID-19 could spell the end of his presidency,” Mr Cooke said.  


With the short-term economic future very uncertain, most economists are  also sure that the RBA cash rate would go no lower than its current 0.25 percent.

Two-thirds of experts (28, 66%) said they eventually expect the rate to increase, but only one, Tony Makin of Griffith University, expected a rise this year. 

“If the virus is satisfactorily contained, and assuming no second wave, the economy should be recovering by the December quarter," Mr Makin said.

“In the context of a domestic and global recovery, the high money growth stemming from public debt monetisation should put upward pressure on the price level, necessitating a monetary policy response. 

“Additionally, the huge issues of government bonds to fund large pandemic-related budget deficits that have not been monetised by central banks here and worldwide, would normally put upward pressure on longer term world interest rates,” Mr Makin said.


Nicholas Frappell, ABC Bullion: "The RBA have indicated that they will keep the rates low for a long period. At the moment it's too early to have a view of when the rates will tighten again, although 'sometime' in 2022 would be reasonable..."

Shane Oliver, AMP Capital: "The RBA will remain on hold. There is little to no value in taking rates to zero or negative and given the recession, high unemployment, uncertainty about the recovery and inflation running way below target, it's way too early to think about raising rates. In fact, it's unlikely to be able to raise rates for the next three years at least."

Alison Booth, ANU: "Hard to pinpoint when there might be changes, since there's so much uncertainty and the RBA will be making decisions as necessary to keep borrowing costs low and credit available."

John Hewson, ANU: "[These are the] worst economic circumstances since Great Depression."

Malcolm Wood, Baillieu: "RBA on hold until back close to full employment and underlying inflation sustainably in the 2-3% YoY band."

Rebecca Cassells, Bankwest Curtin Economics Centre: "Any decision by the RBA to either increase or lower the cash rate is highly unlikely for some time and we can expect the cash rate to remain exactly where it is now for at least the next two years. The most likely direction the cash rate will head eventually is upwards, but we will need some fairly solid and consistent signs of recovery in the labour market before the RBA starts to consider this change. Towards the fourth quarter of 2021 we should be well on our way to more positive signals here, but much will depend on the level of government support and stimulus committed to jumpstart the economy and our ability to minimise and prevent COVID-19 outbreaks. Both are very uncertain right now."

David Robertson, Bendigo and Adelaide Bank: "The RBA have very clearly flagged that rates will be on hold at 0.25 percent (for both official cash and the three-year bond) until well into 2022. The next move beyond there should be up when inflation finally rises and labour markets tighten."

Sarah Hunter, BIS Oxford Economics: "The RBA have made it clear that, for now at least, they don't see negative rates as being necessary or effective. So I think the next move will be up, but it will be quite some time into the future – beyond the end of the forecast horizon in the survey (Q4 2022)."

Ben Udy, Capital Economics: "We suspect the RBA will come around to our view that inflation will be below the bank's target for years and therefore launch more stimulus. We expect the RBA to eventually expand quantitative easing with a quantity bond target aimed at the longer-dated end of the yield curve."

Peter Boehm, CLSA Premium: "Now is not the time to move interest rates – there's too much economic uncertainty, and clarity around the Federal Government's existing and future planned response to COVID-19 is needed before further rate movements should be contemplated."

Saul Eslake, Corinna Economic Advisory: "Could be that the RBA keeps rates on hold until after Q4 2022."

Craig Emerson, Craig Emerson Economics: "The RBA Governor has publicly stated that the cash rate will remain where it is for a long time."

Trent Wiltshire, Domain: "The RBA won't be increasing the cash rate until the unemployment rate is near 5 percent, which is unfortunately at least a couple of years away."

John Rolfe, Elders Home Loans: "I do not believe the RBA will entertain a zero or negative cash rate. The banking industry is not in need of lower rates and even if provided, there will not be any rate reduction passed on to the customer. There are still QE opportunities to stimulate the market if needed."

Angela Jackson, Equity Economics: "There is significant uncertainty around the timing of a vaccine for COVID-19 which impacts the point at which the Australian and global economy will start to recover."

Mark Brimble, Griffith Uni: "The economy will need monetary policy support for a long time to come."

Tony Makin, Griffith University: "If the virus is satisfactorily contained, and assuming no second wave, the economy should be recovering by the December quarter. In the context of a domestic and global recovery, the high money growth stemming from public debt monetisation should put upward pressure on the price level, necessitating a monetary policy response. Additionally, the huge issues of government bonds to fund large pandemic-related budget deficits that have not been monetised by central banks here and worldwide would normally put upward pressure on longer term world interest rates."

Stephen Miller, GSFM: "The headwinds to growth are strong and I do not think that inflation will be comfortably within the current 2-3 percent target range until the end of 2022. I do not think the RBA will lower rates. If they wish to ease further they will employ some other mechanism."

Alex Joiner, IFM Investors: "The RBA is going to have its current policy settings in place for an extended period of time as it needs to support the economy while the labour market repairs. It is difficult to envisage a rise in the cash rate before the end of 2022 in my view as not only do unconventional policies need to be unwound first, it is abundantly clear the RBA won't want to be ahead of other central banks in removing their huge stimulus programs and therefore putting undue upward pressure on the AUD."

Leanne Pilkington, Laing+Simmons: "We have years of low interest rates ahead of us and the banks themselves have sharpened their pencils in recent times, cutting their rates on various products to remain competitive. The pandemic continues to cast a shadow over the economy and the outlook is meagre, but for those whose income remains secure, a real estate purchase is comparatively affordable at present."

Nicholas Gruen, Lateral Economics: "It will be a long road back, especially as the government appears to be keen to reduce the extent of the stimulus."

Mathew Tiller, LJ Hooker: "It's unlikely that the RBA will drop rates further and is expected to continue to support the economy via other stimulatory measures until the full impact of the COVID crisis passes."

Geoffrey Harold Kingston, Macquarie University: "Current monetary and fiscal policies, along with abatement of the virus, will see a gradual emergence of inflationary pressures."

Jeffrey Sheen, Macquarie University: "Consistent with signalling from RBA."

Stephen Koukoulas, Market Economics: "The post COVID-19 recovery will be in place and inflation will edge up toward the RBA’s target."

John Caelli, ME Bank: "The RBA have indicated they will keep rates where they are for a long time."

Michael Yardney, Metropole Properties: "The RBA have indicated it will not raise interest rates until unemployment levels fall to around 4.5 percent. This is many years away."

Mark Crosby, Monash University: "I don't think that further moves in the cash rate would be effective, and given uncertainty around COVID, the timing of future moves is highly uncertain, but doubtful rates will move before 2022."

Julia Newbould, Money Magazine: "I think that the government will need to see what happens when the stimulus payments end and the economy finds its new position."

Susan Mitchell, Mortgage Choice: "I expect the cash rate to remain unchanged at the Reserve Bank’s next monetary policy meeting until progress is made towards the RBA’s goal of full employment and the inflation target. The historic low cash rate continues to support an extremely low cost of borrowing and we are seeing a surge in the number of borrowers choosing to refinance and lock in a fixed interest rate."

Dr Andrew Wilson, My Housing Market: "Monetary policy will continue to be sidelined over the foreseeable future with no logical purpose served by a further cut to zero percent and the prospect of a rise fanciful given economic conditions set to worsen."

Jonathan Chancellor, Property Observer: "Despite their signalling that rates will not be lowered, I think circumstances will warrant the decision to take rates to zero."

Rich Harvey, Propertybuyer: "Far too much volatility and uncertainty to see any movements in interest rates at the moment."

Noel Whittaker, QUT: "This is so difficult – there are so many uncertainties. But, of course, if a vaccine is found the economy may boom."

Cameron Kusher, REA Group: "As much as the RBA is insistent that the current cash rate of 0.25 percent is their floor, depending on the recovery from COVID-19 it may necessitate taking rates lower. Remember that just last year they were saying they didn't believe in QE's effectiveness. Even if they don't cut interest rates further, a hike in interest rates seems likely to be a long way off."

Jason Azzopardi, Resimac: "Clear guidance given by RBA the current monetary policy will remain."

Christine Williams, Smarter Property Investing: "Unstable economy at the moment."

Janu Chan, St George Bank: "RBA will keep its accommodative stance for some time while unemployment remains high. Indeed, the risk is towards additional monetary stimulus measures but the RBA will look to other measures. The cash rate is as low as it can go."

Besa Deda, St George Bank: "The RBA has provided forward guidance about its use of unconventional policies in several speeches since March. During questions following one of these speeches, Governor Philip Lowe has indicated that the cash rate will not be lifted before the three-year bond yield target has been lifted. In addition, he said that the bond yield target will not be removed until progress was being made towards the RBA's inflation and unemployment targets. This is estimated to be at least three years away."

Brian Parker, Sunsuper: "A rate hike is beyond the survey's time horizon."

Mala Raghavan, University of Tasmania: "It is difficult to predict now due to the high uncertainty surrounding the COVID-19 crisis and the subsequent economic crisis. The focus of the policymakers at this stage should be stimulating the economy, but there is not much room in the monetary policy space for that. At this stage, the government's fiscal stimulus is much needed to spur the economy."

Other participants: Duncan Macfarlane, Firstmac. John Smith, Economist.


THIS SATURDAY, June 27, is World MSME Day (Micro, Small and Medium-sized Enterprises Day), a celebratory day declared by the United Nations and an initiative of the International Council for Small Business (ICSB).

Australia and the UK's Institute of Public Accountants (IPA) is encouraging people to celebrate the importance of small business on Saturday.

“The IPA is urging people to support their local small businesses by buying their products or services as a reboot to Australia’s economy during this COVID-19 pandemic,” IPA chief executive officer, Andrew Conway said. 

“The COVID-19 pandemic has affected all of us and the way we live.  Small business is doing it tough and for those businesses affected by the 2019/20 bushfires, followed by this pandemic, the toll has been devastating. 

ICSB data indicates that MSMEs make up over 90 percent of all firms and account on average for 70 percent of total employment and 50 percent of GDP, on a global basis," Mr Conway said.

“Please let your local small business know how much they are appreciated for their ongoing contribution to our nation’s economic wellbeing,” he said.

The IPA, formed in 1923, is one of Australia’s three legally recognised professional accounting bodies.  In late 2014, the IPA acquired the Institute of Financial Accountants in the UK and formed the IPA Group, with more than 37,000 members and students in over 80 countries. 

The IPA Group is now the largest SME focused accountancy organisation in the world. The IPA is a member of the International Federation of Accountants, the Accounting Professional and Ethical Standards Board and the Confederation of Asian and Pacific Accountants.


By Leon Gettler >>

BTC MARKETS, the largest, most liquid Australian bitcoin exchange with 260,000 Australian customers trading more than $8 billion, has a growing market, particularly with self-managed super funds.

Its primary market is in Bitcoin, along with XRP and Etherium, and Litecoin. XRP technology, combined with BTC Markets, uses blockchain to transfer funds in seconds and for a fraction of the price found elsewhere.

BTC Markets’ clients are in retail with everyday Australians using the platform. It also specialises in self-managed super funds (SMSFs).

“We’ve got a specialist on-boarding team specifically for the SMSF market,” Caroline Bowler, the CEO of BTC Markets told Talking Business.

“Then we have our high-net-worth institutional players. They are increasingly coming on board but they are a smaller part of the market.”

She sees enormous growth in the SMSF market.

“From our point of view, we would anticipate SMSFs in this market would probably place about 5 to 10 percent of their portfolio in a product such as ours, and again, everyone’s portfolio is different depending on their risk appetite and according to their own needs,” Ms Bowler said.

”But we are a growing asset class, an exciting asset class and there is plenty of opportunity for scale and growth if you’re looking for long-term investment.”


BTC Markets’ clients manage their own funds as BTC Markets is not licensed to be a financial advisory firm – but it does help facilitate the trade of these cryptocurrencies and tokens.

Ms Bowler said volatility in cryptocurrencies was just part and parcel of that market.

“But if you want to talk about volatility, I think you need to look at what happened in the oil market recently and see the damage that the derivatives did there,” Ms Bowler said.

“There is volatility across all kinds of different market sectors but for currencies such as Bitcoin and others, volatility is just part of the game. But in that, there is opportunity and if people get educated and are savvy, they can ride out those waves.”

Bitcoin is now increasingly being used as a preferred payment option for money transfers and merchants. 

“It’s the liquidity, the fact that it’s global, it’s borderless, it’s swift and it’s efficient. There’s lots of benefits to using a currency such as Bitcoin as form of payment,” she said.

“But’s it’s also considered as a store of value, as an investment asset, so you have two sides to the coin, if you pardon the pun.”


Ms Bowler acknowledged there was some negative perception out there in the market towards some digital assets. BTC Markets sees its role as going out to explain some of the opportunities that exist with cryptocurrencies.

“We’re only 10 years of cryptocurrencies in existence and in that time, the ecosystem that’s been built around it with the technology is just fantastic,” Ms Bowler said. “And it’s kind of naïve to think that that genie is going back into the bottle or that this isn’t going to progress, particularly if you look overseas and see what’s coming out of China in terms of central bank digital currencies and the digitalisation that’s coming out of Europe and what’s happening in the US.

“There’s a building of momentum behind this.

“It’s reached that tipping point where it will go into the mainstream so, from my point of view, the education piece is about explaining to people this is what’s happening, so that people can engage with it in a safe way.”

Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at


THE MAJORITY of experts consulted in the latest  Finder RBA Cash Rate Survey agree that stamp duty could soon be on its way out as the government grapples with the post-COVID economy.

Comparison site Finder’s survey – the largest of its kind in Australia – asked 43 experts and economists about future cash rate moves and other issues related to the state of the Australian economy. 

While all experts surveyed expect a cash rate hold in June (43/43), more than two-thirds who weighed in on stamp duty (69%, 24/35) predicted that it would be axed within the next 18 months, with most (21) expecting the change in 2021.

Policymakers have been calling for an overhaul of taxes to help boost the post-COVID economy, with stamp duty emerging as the most ripe for reform. 

Graham Cooke, insights manager at Finder, said stamp duty heavily penalises families who were required to move regularly for work, as well as those trying to get on the property ladder.  

“Stamp duty makes the process of buying a home even harder,” Mr Cooke said.

“Not only do borrowers have to save a 20 percent deposit, they also need to save well over $10,000 – in some cases more than $80,000 – for a tax that generally cannot be included in your mortgage. 

“It’s like an on-the-spot fine for home buyers. Putting this tax burden all up front, holds back purchases and dissuades buyers from purchasing frequently,” Mr Cooke said.

Not only do economists think stamp duty will be axed, four in five  (80%, 28/35) also think the tax should be abolished or replaced with a land tax.

Mr Cooke said eliminating stamp duty or replacing it with an ongoing land tax could be a great way to stimulate the market. 

“As a borrower, investing that $10k-$80k in the value of your home rather than immediately losing it to the government will be a huge benefit,” he said.


More than four-fifths of experts (29/34, 85%) said the economy would not fully recover until at least 2022.

More than one-third of experts (37%, 14/38) expected Australia to have its first quarter of GDP growth in Q3 2020.

Mark Crosby, applied macroeconomist at Monash University, said Q3 GDP growth is more about how bad the preceding quarters have been. 

“If growth in Q3 2020 was measured against any quarter in 2019 it would be negative,” Mr Crosby said.

“In other words it’s growth but nowhere near a reversion towards trend in Q3, not the end of recession (other than in definition) and not the end of rising unemployment,” he said.


Mr Crooke said those anxious for a ‘normal’ restaurant experience once restrictions ease, may be waiting longer than they think.

Nearly half (47%, 15/31) of the experts who weighed in on hospitality said restaurants and bars won’t be operating at full capacity and without social distancing restrictions until 2021.

Less than a third (10, 31%) expected to see this happening this year.

Mr Cooke said while restrictions were beginning to be relaxed, Australia still had a way to go until things return to normal.   

“While restrictions are beginning to ease, it’s clear we’re still a long way off from booking a big group table at the pub over the long weekend,” Mr Cooke said.


Nicholas Frappell, ABC Bullion: “The impact of coronavirus will create a lasting demand impact and rates will stay low for an extended period of time. The RBA is likely to target longer-term bond yields in preference to negative rates.”

Shane Oliver, AMP Capital: “The cash rate is already at the RBA’s effective lower bound and Governor Lowe has reiterated that negative interest rates are ‘extraordinarily unlikely’ so, rates won’t be cut. But with the economy taking a big hit from the coronavirus shutdown, economic activity has fallen well below potential, and this will take a long time to fully reverse which means high unemployment and low inflation for several years to come so the RBA can’t raise rates. We don’t expect the cash rate to start increasing again for three years at least.”

Alison Booth, ANU: “The economic indicators suggest a rate cut in near future, but the timing is uncertain. Unemployment is increasing, participation and hours of work are declining, investment and household consumption will continue to be declining. Lowering interest rates may encourage people to spend more though the amount rates can drop is very curtailed and any effect would be very marginal.”

John Hewson, ANU: “RBA will hold for a couple of years, but bond selling task may start to force market rates up.”

Malcolm Wood, Baillieu: “RBA forward guidance and zero global rates.”

Rebecca Cassells, Bankwest Curtin Economics Centre: “The RBA won't increase the interest rate until we see strong signs of economic recovery – this may be some years away. Until then, they will keep the cost of borrowing as low as possible.”

David Robertson, Bendigo and Adelaide Bank: “No further cuts needed – we are on our effective floor for interest rates. The next increase is several years away when employment reverts to pre COVID-19 levels.”

Sarah Hunter, BIS Oxford Economics: “I don't think the cash rate will rise until 2023 (so, I'm not really unsure) – the recovery from COVID-19 will have a long tail, and the RBA will be looking to support the economy throughout.”

Ben Udy, Capital Economics: “To be clear, I'm not unsure of the timing. I think the RBA will remain on hold until beyond 2022.”

Peter Boehm, CLSA Premium: “Still unclear how long it will take to get a line of sight on where the economy is heading – I can't see rates increasing for the foreseeable future, especially with potential recessionary pressures on the horizon.”

Saul Eslake, Corinna Economic Advisory: “You didn't have an option for later than Q4 2022, otherwise, I might have chosen that. The RBA has repeatedly stated, since its March meeting, that it will keep the cash rate at its present level until sustainable progress is being made towards the inflation target and full employment – and I suspect it may not be until the second half of 2022 that those criteria are satisfied.”

Craig Emerson, Craig Emerson Economics: “No one can predict the course of a global pandemic and its economic impacts.”

Trent Wiltshire, Domain: “The RBA will keep the cash rate unchanged for at least the next two years as the unemployment and underemployment rate will remain elevated for an extended period due to the COVID-19 recession.”

John Rolfe, Elders Home Loans: “I do not think the RBA will lower the cash rate any further. There would be no benefit to anyone other than the banks and they are in a strong position. I believe the next rate will be up – perhaps as early as at the end of Q1 2021 if there is no second wave of COVID-19 in Australia.”

Angela Jackson, Equity Economics: “The RBA will hold cash rates until the economy recovers and unemployment is around the 8 percent mark. Uncertainty around the path of COVID-19 makes predictions on when this occurs difficult. Best case scenario third or fourth quarter of 2020-2021.”

Mark Brimble, Griffith University: “The current situation will need to play out further before a direction is clear.  Either way, it is likely to be lower for much longer.”

Tony Makin, Griffith University: “The official interest rate has apparently reached its floor level. The main story now is the quantum of government bonds the RBA has been buying as a result of the COVID-19-related spike in the budget deficit. Textbook monetary economics tells us this increases the money supply accordingly.  Central banks around the world are doing likewise.  Whether this means a subsequent and unexpected global inflation surge remains to be seen.  But history shows it could happen after a lag of several years.”

Stephen Miller, GSFM: “I do not think the RBA wants to cut the cash rate further. Any easing of monetary policy will take a different form.”

Peter Haller, Heritage Bank: “The RBA has made it clear that the cash rate will be at 0.25 percent for an extended period of time.”

Leanne Pilkington, Laing-Simmons: “The RBA has stated its view that rates are at their lowest point, and there’s no appetite for negative rates. The banks themselves have access to cheap credit at the moment, which is reflected in the low rates charged to customers. The economy remains in a fragile place and while some businesses cautiously re-open, we see the holding pattern continuing for the foreseeable future.”

Nicholas Gruen, Lateral Economics: “They should cut to zero (no reason not to), but they’ve said they won't.”

Mathew Tiller, LJ Hooker: “The RBA is unlikely to drop rates further and is expected to continue to support the economy via its other stimulatory measures.”

Geoffrey Kingston, Macquarie University: “Inflation could be picking up at this point.”

Jeffrey Sheen, Macquarie University: “The economy should have recovered sufficiently in two years.”

Stephen Koukoulas, Market Economics: “The fall-out from the health crisis is still unfolding. It is not possible to be confident about monetary policy pressures until that is resolved.”

John Caelli, ME Bank: “The RBA will keep the cash rate unchanged for an extended period of time until the full impacts of COVID-19 are known.”

Michael Yardney, Metropole Property Strategists: “We are now in the low-interest-rate environment for at least three years, the RBA doesn’t want to spook the market with negative interest rates.”

Mark Crosby, Monash University: “Further rate cuts are likely to have no effect, and I think it will be a while before a full recovery from COVID-19 leads to increasing rates – in other words, the RBA is likely to do nothing on rates until 2022.”

Julia Newbould, Money: “Depending on what other stimuli are employed, it might be time to raise the rates by then.”

Susan Mitchell, Mortgage Choice: “I expect the Reserve Bank to hold the cash rate at its monetary policy meeting in June. RBA board members seem resolute in their mission to support the economy as they target full employment and the inflation target. April Labour Force data from the Australian Bureau of Statistics shows that this goal will not be achieved in the near-term, with a tragic loss of employment over the month. That being said, April Payroll data from the ABS provided a glimmer of hope that the deterioration may not continue into May. While social distancing rules had a detrimental effect on property sales, data from CoreLogic shows that the loosening of restrictions has seen volumes lift again, which may be bolstered by an extremely low cost of borrowing for the foreseeable future.”

Dr Andrew Wilson, My Housing Market: “Rate to remain steady for foreseeable future. Contemporary, effective monetary policy set to go the way of the dinosaurs.”

Andrew Reeve-Parker, NW Advice: “Interest rates are at historic lows at the moment, but by 2022, I expect the economy to be running ahead of trend."

Rich Harvey, Propertybuyer: "COVID-19 has placed policymakers in a very difficult situation.  RBA has already indicated they will not go to negative interest rates and there is little impact reducing a further 0.25 percent.”

Matthew Peter, QIC: “The RBA and other global central banks will keep rates at their lower bound for some years to come. It is unlikely that we will see a rise in policy rates within the coming four years.”

Noel Whittaker, QUT: “No way they were increasing them – and it’s pointless to drop them. There are too many uncertainties to make any kind of forecast – I am pessimistic.”

Cameron Kusher, REA Group: “They have stated that there will be no increase in the cash rate until unemployment is on its way to full employment and they are comfortable inflation will be within 2-3 percent. That looks a long way off. They also seem extremely reluctant to take the cash rate any lower than it currently is.”

Sveta Angelopoulos, RMIT university: “The RBA is unlikely to change the cash rate until the economy is well into recovery and even then, only if it feels, it is overheating.”

Christine Williams, Smarter Property Investing Pty Ltd: “Given the medical and financial climate we are in, I believe rates will be kept on hold.”

Janu Chan, St George Bank: “RBA is unlikely to move the cash rate any time soon. It sees the cash rate at its effective lower bound, and for the cash rate to increase, we would need to see a very meaningful decline in unemployment. Spare capacity in the labour market will remain for some time.”

Besa Deda, St.George Economics: “The RBA has indicated that it will not raise the cash rate before removing the 3-year bond yield target. It will take time for the unconventional policies to be unwound, and these will only be unwound once the economy recovers which is not expected until later this year and next.”

Mala Raghavan, University of Tasmania: “Due to the uncertain times ahead and the worldwide ability to contain the pandemic, it will be difficult to predict the effectiveness of an accommodative monetary policy (irrespective of conventional or unconventional measures).  What is probably needed for the way forward, is a well-coordinated fiscal and monetary policy measures - first, the focus should be on containing the health crisis, and then subsequently the focus should be on stimulating the economy.”

Other participants: Bill Evans, Westpac. Jason Azzopardi, Resimac.


By Leon Gettler >>

A LOT OF BUSINESSES have done it hard since the shutdowns and social distancing rules came in. But CreditorWatch data suggests small businesses were struggling with cash flow issues long before the coronavirus lockdown measures came into play and were unprepared for the current downturn.

Patrick Coghlan, CreditorWatch CEO, said it was all too evident that many businesses were unprepared – although not many companies would have been prepared for it.

He said the majority of small to medium enterprises (SMEs) only held a few weeks, maybe a couple of months at best, of cash reserves that can withstand a 70-90 percent downturn in revenue. 

Mr Coughlan said the data showed that small businesses were being paid 40 percent slower than the previous quarter.

“And that was for Q1 2020, so that’s pre-coronavirus,” Mr Coghlan told Talking Business. “So they were already struggling to get cash in the door before they got hit with the pandemic itself, which means there is underprepared and extremely underprepared – and it was a horrible situation for most SMEs and their directors and owners out have to deal with this, as well as the already slow-paying customers.”


Mr Couglan said the problem was right across the board, but there were some specific sectors that stood out.

He highlighted agriculture, which was no surprise as it had been hit by fires and floods in late 2019 and early 2020; construction which is always slow over that Christmas-New Year period; retail which had experienced a number of administrations taking place in November and December; transport was struggling; and a lot of professional services businesses, with many customers slowing their payments and looking to see whether they could move somewhere else.

“SMEs at the moment are doing it extremely tough and the challenge is how do they get out of it?” Mr Coughlan said. “I’ve been talking about zombie companies, companies that were struggling pre-corona.

“If corona hadn’t come along, you’d be questioning whether they would still be around within the next six months as a result of tightening cash flow, reducing margins and a reduction in profit and revenue,” he said.


Mr Coughlan said the government sector had responded by introducing terrific measures like insolvency changes.

“What I think that does, though, is kick the can down the street so to speak in terms of directors and shareholders looking at their business and saying: ‘We probably should have wound this up in early 2020 but why don’t we take advantage of JobKeeper and why don’t we take advantage of the fact that we can trade insolvent and let’s see what happens. Who knows what will happen? It gives us six months, so let’s go with that.’ “

That said, there were plenty of signs of businesses looking for opportunities. 

Faced with revenues falling 90 percent, businesses were now coming up with new models, selling food online and marketing it through social media, or re-producing office furniture recalibrated for a work-from-home environment, or businesses creating protective gear for health workers and ventilators.

Mr Coughlan said CreditorWatch had seen a significant drop in credit inquiries in March, but in April it jumped 36 percent not only on existing customers but new customers applying for credit. This was a healthy sign.

“I think what you’ll find is suppliers, distributors, manufacturers will start to have a good sense of which of their customers are hibernating or potentially going out of business,” Mr Coughlan said.

“They’re starting to do new searches on companies that are coming to them and they’re getting a sense of which of their existing customers are healthy – and that’s all designed for them to be able to continue to trade or to start trading as soon as possible,” he said.

Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at



THE Institute of Public Accountants (IPA) has welcomed the introduction of the Payment Times Reporting Bill 2020, saying its implementation will go a long way to help small businesses that are struggling with cash flow issues.

“This legislation will bring greater transparency, requiring businesses with over a $100 million turnover to publish their policies including payment times,” IPA chief executive officer, Andrew Conway said.

“We appreciate that businesses are doing it tough in this COVID-19 pandemic environment, but small businesses still need to be paid on time to help keep them afloat. 

“The ASBFEO final report on its Payment Times and Practices Inquiry [1]points to the fact that a lack of cash flow is the leading cause of business insolvency and this underscores the importance of the issue of late payments which can easily put many businesses out of operation.

“The ACCC[2] has highlighted of big businesses refusing to pay small business suppliers or in some cases, trying to renegotiate pricing that had been agreed upon after the product or service has been delivered," Mr Conway said.

“The Bill will see the establishment of a Payment Times Reporting Scheme[3] which will be reviewed after three years.  It also provides for the creation of a Payment Times Regulator.

“The Bill also allows the Regulator to publish information about a reporting entity that has failed to comply with the Act. This will provide transparency to small businesses using the register, allowing them to determine the companies they will engage with.

“As the legislation defines small businesses as those with a turnover of less than $10 million and therefore, 99 per cent of businesses, it is hoped that small businesses will get a fairer go," he said.

“The IPA has been a long-time advocate of legislating payment times, given that Australia has one of the worst records for payment times to small business compared to many other countries. 

"Hence, we support the ASBFEO recommendation that all small businesses should be paid within a 30-day time frame.  We hope that this will happen well in advance of the three-year review,” Mr Conway said.



[2] ACCC Commissioner Rod Sims at small business and franchising consultative committee meeting.




ASIC has amended the Corporations Act 2001 to provide an additional month for companies to lodge their financial statements.

This affects all entities with June 30 year-ends which lodge financial statements under the Corporations Act.

Importantly for listed entities, the ASX has not extended the deadline for the lodgement of Appendix 4E under ASX Listing rules 4.3A and 4.3B. This means that non-exploration entities will still have to lodge financial statements by 31 August. 

If the audited financial statements are not available by that date, they must lodge unaudited financial statements. The extensions above do not affect continuous disclosure obligations, and listed entities should continue to lodge their financial statements as soon as practicable. Where listed entities intend to rely on this extension, they should disclose this to the market, and state the reasons why they have used the extension. 

Commenting on the extension, RSM Australia national technical director, Ralph Martin said, “We welcome ASIC’s extension of relief from financial reporting deadlines to 30 June preparers. The impact of COVID-19 on business has been significant, and its effects will cause substantial challenges in preparing and auditing financial statements, including issues such as the determination of fair values, impairment assessments, and going concern considerations.

"While Australia has currently been less affected than some other jurisdictions, many Australian entities have global operations which continue to experience a high level of disruption to their operations. The deadline extension offered by ASIC is a suitably proportionate response which balances these issues against the need for timely and relevant financial information.” 

Details are:

  • The deadline for listed companies is extended until 31 October 2020 (but see below in respect of Appendix 4E).
  • The deadline for unlisted disclosing entities and registered schemes is extended until 31 October 2020.
  • The deadline for proprietary companies and other non-disclosing entities is extended to 30 November 2020.
  • Listed entities with a 31 December year-end now have until 13 October to lodge their half-year reports.



Contact Us


PO Box 2144