Improving Australia's productivity and boosting business confidence would be the key objective of a Coalition Federal Government, Shadow Treasurer the Hon Joe Hockey told a CEDA business forum in Adelaide.
Last week's decision by BHP Billiton to indefinitely postpone its $30 billion investment in South Australia's Olympic Dam mine indicated the rising level of risk in doing business in Australia, Mr Hockey said.
Uncertainty about taxes, the introduction of 26 new taxes since 2007 and a rising number of industrial disputes - particularly in mining and construction - had increased business costs and sovereign risk attached to investment in Australia, he said.
"The costs of doing business in Australia at the moment are high and the revenue from commodities is down. It's a pretty simple equation (for BHP Billiton)," he said.
Mr Hockey said that a Coalition government would focus on:
- Reducing government spending and its demands on capital markets;
- Reducing tax and red tape, including a review of the Australian Tax Office;
- Productivity reform; and
- Closer engagement with Asia - particularly by promoting bilateral trade relations in agriculture and services and setting a target of 40 per cent of high school students to study Asian languages within the decade.
Mr Hockey said declining business confidence was evident in the latest CEO Forum survey which found 60 per cent of global companies operating in Australia said policy uncertainty had grown in the past 12-18 months.
Forty-one per cent of these companies said their parent company based overseas was now less likely to invest in Australia than they were 12-18 months ago, while 20 per cent said they were more likely to invest, he said.
Mr Hockey also said boosting productivity would be a key focus of a Coalition Government and was critical to maintaining Australia's prosperity after the mining boom.
"The danger is that our economy will falter now that the resources boom…is ending unless Australia's previously strong productivity growth can be restored," Mr Hockey said.
He said the Coalition had a six point productivity plan to:
- Reform welfare and lift workforce participation;
- Reform the public sector;
- Cut red tape;
- Review competition policy to ensure a level playing field for large and small businesses;
- Ensure commonwealth spending on infrastructure provides value for money and seek further investment from superannuation funds and state governments; and
- Improve labour market regulation.