From COAG to National Cabinet – Regulatory Reform

As the Prime Minister told the press club on 26 May:

An educated and highly skilled workforce that supports not just a thriving and innovative services sector, but a modern, competitive and advanced manufacturing sector.

The skilled labour businesses need to draw on, the affordable and reliable energy they need, the research and technology that they can draw on and utilise, the investment capital and finance that they can access, the markets they can connect to, the economic infrastructure that supports and connects them, the amount of government regulation they must comply with, and the amount and the efficiency of the taxes they must pay, in particular whether such taxes encourage them to invest into employ.

Now that is the change agenda at job making plan, to enable Australia to emerge from this crisis and set up Australia for economic success over the next 3 to 5 years.

The new National Skills Commission will now provide detailed labour market analysis, including in and report each year setting out the skill needs of Australia, replacing those existing lists for apprentice ships and skilled migration.

To better link with business needs and reducing distortions and achieving greater consistency between jurisdictions, and between VET and universities, vocational education funding of states and territories will change. The intention is to move towards a national efficient pricing and activity based funding model, based on the system currently in place to fund hospitals for the VET sector with the hope that that system of Commonwealth funding will lead to an increased number of people finishing vocational qualification courses.

Five working groups are examining the industrial relations system to deal with:

  • issues that have arisen with regards to award simplification;
  • the way in which enterprise agreement making is undertaken;
  • the clarity of casual employment arrangements;
  • the effectiveness of compliance and enforcement mechanisms; and
  • simplifying the ‘greenfield arrangements’ for new enterprises.

This work is slated to be finished in September.

The National COVID-19 Coordination Commission is providing policy ideas directly to government. In particular, Commission has asked Andrew Liveris to deliver a report  to develop a ‘competitive, best-in-class manufacturing sector as a major pillar in helping rebuild the economy’.

Changes to the Environment Protection and Biodiversity Conservation Act 1999 will be also be made  with the intention of speeding project approvals, as part of achieving an objective of streamlining of Commonwealth and state processes to a point of ‘single touch approvals’. The interim report from the Independent Review of the Act has now been published.

The Council of Federal Financial Relations has responsibility for dealing with tax and regulation.

They have started with amendments to occupational licensing regimes.

The CFFR will prioritise implementation of a uniform scheme to support widespread occupational mobility via automatic recognition (hopefully by 1 January 2021), to ‘make it easier and less expensive for businesses, professionals and workers to move or operate within jurisdictions and across Australia, thereby creating jobs, increasing output, competition and innovation, and resulting in lower prices for consumers and businesses.’

States and Territories will need to pass enabling legislation.

With regards to taxation, the Treasurer has said:

During the crisis, we have also prioritised tax changes that support business investment and will continue to do so.  There can be no sustained recovery without new investment.

I’m encouraged by the early discussions I’m having with State Treasurers about tax issues at our Council of Federal Financial Relations meetings.

We all recognise there is a need and an opportunity for reform in a very complex area with many moving parts.

Our principles are agreed.  We are all in favour of tax reform that delivers a simpler, more efficient and sustainable tax system as a pathway to more jobs and investment.

However, progress may be slower here.

The NSW Government’s Review of Federal Financial Relations proposed 15 recommendations, which included the option of lifting the GST rate or expanding the base, with a view to ‘move away from more harmful taxes’.

However, there appears limited appetite to amend the GST and an attempt for the States to seek federal compensation to phase out stamp duty and to switch to a voluntary land tax for future home buyers seems to have limited purchase.

Another change is the sad death of COAG. This is discussed in the next post.

By | 2020-08-31T14:19:17+10:00 August 31st, 2020|COAG, National Cabinet, Regulation|0 Comments