Skills top priority for new BCA boss

Ensuring Australia has the right skills is the No 1 issue, according to incoming Business Council of Australia president Tim Reed.

Incoming BCA President Tim Reed in Sydney on Thursday. Picture: Nikki Short

Ensuring Australia has the right skills for the future is the No 1 issue facing the economy, according to incoming Business Council of Australia president Tim Reed.

Ensuring the policy settings were right to maintain the country’s competitive position and a tax base to drive investment were the other key agenda items, Mr Reed said.

The 49-year-old former MYOB chief executive replaces former BCA president Grant King, who will step down at the peak business lobby’s annual meeting on November 20.

“I am passionate about business’s role in society and want to make sure Australia is a great place to invest and a competitive place to do business,” Mr Reed said in a briefing.

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“When you look at 13 million working Australians, 11 million of them work for a business. It’s business that invests in those people’s skills, it’s businesses that have to continue to prospect so they can continue to employ those people and we can see the wages of those people rise.”

Mr Reed rejected suggestions the BCA had lost relevance in the national debate.

“I do take on the role as someone who is very passionate about the positive role that business plays in our community and our society and the need for business to continue to be present at the table and to be part of the conversation.”

Top of the agenda for business was making sure Australians had the right skills to continue having high-paying jobs to drive productivity.

Second on the agenda was making sure regulations and policy settings were in place to so businesses of all sizes could be competitive, and the third item was making sure the tax system allowed for further investment.

Tax cuts

While corporate tax cuts might be off the agenda in the Morrison government’s current term, Mr Reed said he was hopeful the issue remain alive in the future.

“For most of the past three decades, Australia’s company tax rates were below the OECD average. But in recent years we’ve moved into the top quartile in terms of tax rates. I think believing we’re going to continue to have decades of economic growth while our company tax rates sits in the top quartile is naive.”

He takes over at a time when Josh Frydenberg has flagged an investment incentive in next year’s budget but ruled out major new spending decisions, saying it is essential to keep the budget primed for any prolonged downturn.

The new BCA boss was chief executive of accounting software provider MYOB for 12 years and spent 16 years with the company before it was acquired by private equity firm KKR in a $2bn deal that was finalised earlier this year.

Mr Reed is looking to bridge the gap between big and small business, saying “I grew up in a family company. Small business and big business want the same thing, which is a strong economy.”

He believes the divide between big and small business is often overstated with both sectors reliant on the other for success. Small business often makes up the supply chain of many big businesses, while big business can provide infrastructure and the economy for small business to grow.

Youth and business concerns

As well as youth, Mr Reed also brings to the table ideas around technology and the pressures faced by businesses as they try to get bigger.

“There are lots of reasons why we are a great place to invest but we need to make sure that competitiveness remains on the agenda for any government.”

The Treasurer welcomed the appointment, saying the “industry experience and insight Mr Reed brings to the role will help to ensure the Business Council continues to make a valuable contribution to the policy debate and the interests of business”.

Mr Frydenberg also paid tribute to outgoing BCA president Grant King, who he noted “guided the BCA and its members through complex public policy debate and made a significant contribution”.

Opposition Treasury spokesman Jim Chalmers said he looked forward to working with Mr Reed “on ways to grow the economy and create more jobs and opportunities for more people”.

Despite calls from some in the government for business leaders to stick to the economy when advocating policy, Mr Reed said he wasn’t going to shy away from social issues.

Mr Reed noted he took a position of supporting marriage equality when he was chief executive officer of MYOB.

“I do think that the voice of business and particularly a group like the BCA needs to predominantly focus on the issues that will drive prosperity for all Australians and will drive a competitive nation. But I also believe our community expects business to present in any conversation that they feel is relevant to them.

“I think business leaders need to be empowered to involve themselves in conversations where it does impact or relate to their business.

“Certainly I do intend to make sure that we do continue to be present in the community and continue to talk to all members of the community and to be proud of what business brings to our nation.”

Open doors

His comments come after Ben Morton, the assistant minister to the Prime Minister, took aim at business for being seduced by “self-appointed moral guardians” and joining campaigns on social issues rather than on tax and industrial relations.

Mr Reed has previously urged big business to open its doors to start-up companies.

“Small business wants nothing more than to have a big business in town to invest in the economy,” he said.

“Small business tends to live in a discretionary pocket of the economy, which means it is ­vulnerable when spending slows.”

BCA chief executive Jennifer Westacott paid tribute to Grant King “for his leadership and wise counsel to the business community throughout the complex policy debates and turbulence of the last few years”.

One of the innovations credited to Mr King is a strong social media presence at the BCA and a communications program where its “plan for a stronger Australia” policy is taken directly to regional Australia.

He cautioned against government action that might create sovereign risks, saying the BCA opposed proposed laws like the so-called “big stick” divestment powers aimed at energy companies.

When asked about the need for more government action on productivity reform, Ms Westacott said history showed productivity growth had slowed and a lot of regulation sits with the states.

“Planning approvals need reform and we have to restore the VET system to improve skills training,” she said.

“It is expensive to do business and productivity needs to be on the COAG agenda.”