Manufacturing News

Smart spending critical for a balanced future: Ridout

An opportunity exists in this week’s Budget for the Federal Government to invest in future growth and prosperity, according to a media notice issued by Australian Industry Group chief executive, Heather Ridout.

According to Ridout, the Budget should have a particular emphasis on those sectors under sustained structural pressures in the two-speed economy.

“Business is looking for a budget that strengthens investments in export programs, innovation and research and development; business capability programs; targeted infrastructure expenditure; and training and skills development,” she said.

“In short, the focus needs to be on quality spending which gives priority to investment in the drivers of longer-term economic performance, particularly productivity. To achieve this, the Government will need a clever budget that treads the fine line between the need to strengthen the recovery in the near term while returning the Budget to surplus as soon as practical.

“Investments in the longer-term growth drivers should include policies and programs to address the risks arising from the two-speed economy. Industries exposed to these pressures include manufacturing, tourism, education and agriculture. They are also impacted by the strong dollar and higher interest rates as they compete with the booming minerals sector in capital and labour markets.

“We need to ensure we develop a balanced and diversified economy so when mineral prices return to more normal levels, we are not left with a narrow economic base on which to rely for the future.”

Ai Group has proposed a number of measures to stem the erosion of support for business investment in innovation and research and development including by removing the proposed restrictions on eligibility for the R&D tax concession.

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