Budget High Wire Act for Uncertain Times

“Today’s federal budget is a mix of measures focussed on building the longer-term strength of the economy and providing short-term cost of living relief to help Australians get through the current spike in inflation,” Innes Willox, Chief Executive of the national employer association Ai Group said today.

“The Budget provides a welcome investment in skills development and training. The extension of existing support and the new apprentice incentives for employers and apprentices themselves, as well as the measure boosting the incentive for small businesses to invest in the skills of their employees are important down-payments on this critical area. The National Skills Agreement between the Commonwealth and the states and territories has the potential to further drive skills development but remains outstanding.

“The measures to lift Industry and university collaboration and the support for small businesses investing in digitisation are important steps to drive Australia’s longer-term economic development.

“The Government’s cost of living measures will provide significant relief from the current uplift in inflation by easing pressures on fuel prices, giving low and middle-income earners as well as a wide range of pensioners and income support recipients more cash in their pockets.

“The inflationary risks of these measures will be significantly reduced if they are taken into account in wage deliberations – including in the upcoming National Minimum Wage Case.

“The Budget sets out the clear risks to the further recovery of the economy including another COVID wave, the impact of war in Ukraine, questions about China’s short-term growth and the build-up of inflationary pressures.

“With cyber security a major issue for business and the country, the significant and forward-looking investment in Australia’s cyber capabilities is a recognition of the increased threats we will be facing.

“The permanent migration target of 160,000 with a restored focus on skilled migration is clearly welcome but will not be sufficient to fill the labour and skill shortages that businesses and other employers are now facing. Business in particular will be hoping that this number can be raised as quickly as possible.

“The Budget unfortunately does not make headway into some of the structural barriers to further growth including taxation reform and the still disappointing levels of business investment. Hopefully this can be addressed in the lead up to the election,” Mr Willox said.

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