Business plea for carbon tax and budget certainty

POLITICAL uncertainty over the carbon tax and the budget will harm the economy — and ultimately ordinary consumers will pay the price, business leaders warn.

AUSTRALIA’S biggest private employer has called on the Senate to urgently repeal the carbon tax and pass the May budget to end a potential confidence-destroying stand-off.

As job figures reveal the nation’s jobless rate has climbed to 6 per cent, Richard Goyder, the head of Wesfarmers — which owns Coles, Bunnings, Kmart and Target — told News Corp Australia that urgent action was needed to resolve political uncertainty and fix the budget.

“It’s more than a game ... business just wants certainty,” Mr Goyder warned as rogue MP Clive Palmer and his Senators dramatically reneged on a deal to repeal the carbon laws yesterday, citing concern savings would not flow through to consumers.

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But in an exclusive interview, Mr Goyder said consumers could expect to see savings at the check-out.

“Coles is a significant user of energy so yes, there are [savings to be passed on],” he said.

“Hopefully it will reduce our supplier’s cost of doing business — it will reduce ours.”

The average household food bill had already fallen 4 per cent a year over the past five years, he said.

Uncertainty will impact on consumers ... Business Council of Australia president Catherine Livingstone. Picture: Anthony Weate

The president of the Business Council of Australia, Catherine Livingstone, also expressed frustration at the failure of the Senate to reach an agreement.

“Failure by the parliament to repeal the carbon tax by next week will create significant uncertainty for businesses, particularly electricity retailers, with flow-on consequences for consumers,” she said.

Next week Mr Goyder will head a B20 meeting of more than 400 business leaders to inform the Abbott government’s G20 agenda.

They will call for a greater focus on jobs, growth and urban investment to fill an anticipated $60 trillion global infrastructure gap by 2030.

“You’ve just got to drive into any of our cities ... roads, transport, ports, airports — there’s any number of significant infrastructure needs in this country,” Mr Goyder said.

“The number one thing people worry about is jobs” ... Wesfarmers head Richard Goyder. Picture: Sam Mooy

Tax reform, including cutting Australia’s “uncompetitive” company tax rate, was also urgently needed to stimulate jobs and investment.

More immediately, Mr Goyder said resolving political uncertainty and repairing the budget were key to boosting business and consumer confidence.

“Business wants the federal government’s fiscal position sorted and in good shape and I think saying ‘no’ to things — if that’s what people want to do — then they’ve got to come up with other ways of sorting this out.”

“The government has to be able to deliver — just like you and I do at home — a budget over time that is affordable.”

With about $25 billion of budget savings facing defeat in the senate, Mr Goyder warned that budget repair was critical to protect against future economic shocks.

“Australia has a AAA credit rating at the moment and we’ve got to make sure we keep that.”

Key moment ... The Senate voted down the Carbon Tax Repeal Bill 37 votes to 35.

Mr Goyder said budget measures were not the main thing troubling households: “I think the number one people worry about is jobs.”

And business needed regulatory and policy stability to invest and create jobs, he said.

Wesfarmers already employs more than 200,000 Australians and expects to hire “several thousands” more this year, he said.

Repealing the carbon tax would be time consuming for business — as was its introduction. But creating an environment of certainty was paramount.

“I think the government was elected on a platform and everyone’s had an expectation this will be dealt with this week and now it’s going to be back in the air again.”

“Again that just goes to certainty, and one of the issues with the carbon tax is if the current legislation isn’t passed then we’re living with the existing arrangements. The actual tax itself has gone up and so we’ve got to continue on the path we’re going on.”

“Within a number of our businesses, there was a huge amount of complexity to introduce the carbon tax and then to take it out.”

“You’ve got to get organised for these things. It’s more than a game.”

Originally published as Business plea for carbon tax and budget certainty