Caleb Bond: We should be doing everything to get businesses here instead of Sydney
It will take bold thinking to rebuild the economy after coronavirus, writes Caleb Bond. So let’s start by abolishing payroll tax and luring businesses from interstate.
Opinion
Don't miss out on the headlines from Opinion. Followed categories will be added to My News.
If there’s anything South Australia really needs, it’s growth.
We were, of course, having this argument before the ’rona hit. But it is now more important than ever to get this state’s economy going.
Which is why it’s such great news that global tech giant Accenture is going to set up shop right here in little old Adelaide – and bring 2000 jobs with it.
Artificial intelligence, national security and cyber defence technology all coming out of Adelaide.
They are – to borrow a marketing phrase – jobs of the future, which are essential to having a lasting economy and not just one that enjoys small bursts of success.
So now we have Accenture, let’s go find more businesses. Bring them all here and get them to create jobs.
Throw out the rule book. It’s time to start actively competing with other states to bring businesses here. South Australia has all the perfect conditions for businesses to set up shop.
Property is far better value than it is in the eastern states. It’s much easier to get around Adelaide than it is Sydney or Melbourne. It is arguably the best place in the country to bring up a family.
And did I mention the property prices?
The cost of doing business in SA will almost certainly be lower because the cost of living is lower. And it’s not like you have to be in Sydney or Melbourne to do anything important now that everyone is used to this Zoom stuff.
These are benefits you can sell to both businesses and workers.
SA also doesn’t take as much advantage as it should of the fact we are placed between the east and the west. If you have outposts on both sides of the country and want a central headquarters, where better to house it than Adelaide?
I have long argued that the supposed “brain drain” – young people leaving South Australia – is not something we should worry about.
Young people will always leave smaller cities for the brighter lights of bigger cities. It gives them opportunities and opens their minds. That is something from which they should not be deterred.
The real problem is that by the time they want to settle down and have kids, they can’t find adequate jobs back here in their chosen fields.
Adelaide is a family city. If we want families to set up shop here, we need to provide skilled jobs for parents.
If you’re a big business wanting to set yourself up in Australia, chances are you’re going to first look at Sydney or Melbourne. It’s where everyone else is headquartered, so it’s the most obvious choice.
We need to divert their attention from the eastern seaboard and to Adelaide. Make these businesses an offer they can’t refuse.
Give them temporary tax breaks to set up shop. Offer them cheap land. Agree to subsidise the fit-out of their new offices. Find something they want and offer it to them.
Do the same with existing businesses. There should be no reason we can’t poach outfits from Sydney and give them a better offer in Adelaide.
Competitive federalism is a good thing. It puts the responsibility on individual states to compete for business and the provision of services.
South Australia could, for instance, cut payroll tax to the point that businesses stand to save serious money by setting up shop here.
Our payroll tax rate is 4.95 per cent – which is marginally higher than Victoria and half a per cent less than NSW.
If we halved that rate – or, better yet, abolished the tax altogether – we would have a convincing argument for businesses to set up in Adelaide.
The government obviously misses out on that tax revenue, but jobs growth will mean population growth and those people will find ways to spend their money. The immediate effect of creating 2000 jobs has a much larger flow-on effect to the rest of the economy, which eventually flows back into the government’s coffers.
We have a wonderful state, but its population is ageing. That doesn’t mean South Australia has to become New York in order to survive, but we do need jobs.
Bold thinking and job creation are more important now than ever. It’s time to pull off the gloves.