The Federal Government’s Economic Statement on Thursday didn’t hold too many surprises directionally but did reveal a challenging set of numbers in terms of forecast deficits and debt for the foreseeable future. Based on these projections it is clear we will all need to become versed in a more nuanced fiscal conversation for the future – for now, suffice to say Australia remains in an enviable position when compared with so many of our peers.
Underpinning the fiscal projections is the expectation of a pretty solid economic recovery in 2021, which assumes, among other things, that Victoria’s current lockdown is not extended, that other states continue along a gradual path to normalised activity, and that international borders re-open in January. To paraphrase the Treasurer, the outlook does indeed remain uncertain.
As an aside, the significance of what happens to international borders and immigration is fairly obvious for many reasons, but given the extent to which the rising population has underpinned economic growth in Australia recently, it is worth highlighting that according to the fiscal update, population growth next year, at just 0.6 per cent, is expected to be the lowest recorded since 1916-17.
For many, confirmation of an extension of the JobKeeper and JobSeeker payments, albeit at lower rates, was welcome. These payments have undoubtedly supported employment and household spending over recent months, particularly in the most vulnerable households, which have been using the cash to bolster their economic security. The issue of finding an appropriate ongoing level for JobSeeker/Newstart payments remains unaddressed (see below).
While much focus rightly remains on health outcomes and providing immediate support for jobs and economic recovery, attention is shifting to policies required to reignite and support longer term growth. Many have remarked on the innovation and economic dynamism demonstrated through the COVID crisis, as business and government alike have embraced digitisation. Focusing on how to retain and build on this economic dynamism is a priority and a focus for CEDA. We will continue to produce research papers, blogs and podcasts over coming weeks examining issues and policy options that need to be on agenda, ahead of the Federal Budget in October, and in the context of longer term reform opportunities.
So we plan to continue to provide a steady stream of relevant content for you, including reintroducing face-to-face events on a smaller scale as states permit.
Watch: We’ve locked in our next hybrid event, the Queensland State of the State, for Thursday 20 August with Queensland Premier, the Hon. Annastacia Palaszczuk. Much like our recent event with NSW Premier, the Hon. Gladys Berejiklian, we will have a small audience in attendance and will also livestream the event. These events have proved to be very popular, bringing the insights of our Premiers to a wider audience at this critical time. You can register for the livestream here.
Listen: following the release of the July Economic Statement and the update to JobSeeker and JobKeeper last week, CEDA Chief Economist Jarrod Ball was joined by ACOSS Principal Advisor, Dr Peter Davidson, for an episode of The greater good, to discuss the implications of a lowered JobSeeker rate, the impacts on the unemployment rate for the foreseeable future, and how we can prevent the economy from falling further than is already expected. Listen here.
If you are enjoying our podcasts, can I encourage you to take a moment to rate and subscribe to them. Subscribing means you get the episodes in your phone as soon as they go live and rating our show helps others find it too. You can find them on Apple Podcasts, Spotify and Google Play and other podcast platforms.
Read: keep an eye out for our paper Australia’s Federation: post-pandemic playbook, out later this week. It details the actions needed to lock in the long term effectiveness of National Cabinet.
Also up today, is a member profile of KPMG Australia National Chair, Alison Kitchen, as we reboot our member profiles. Alison details how they are helping clients through COVID-19 and how the current environment offers an opportunity to reset on a number of key public policy issues. Read more here.
A big thank you to our renewing members this week. As we’ve rolled into the new financial year it has been pleasing to see so many members continuing to renew and recognise the value in CEDA’s program of work. It has been a real shot in the arm for the team.
Renewing national members
Renewing state members
Arrow Energy (QLD)
Atlas Urban Economics (NSW)
EISS Super (NSW)
Guide Dogs SA/NT (SA)
Ipswich City Council (QLD)
Monash University (VIC)
Public Sector Commission (WA)
Shire of Serpentine-Jarrahdale (WA)
South Australian Water Corporation (SA)
Victoria University (VIC)
Finally, in Victoria and NSW it feels like we are at a critical juncture in the fight against COVID-19. Fingers crossed this juncture becomes a turning point for Victoria, that NSW manages to avoid having to reimpose further restrictions on activity, and that our other states and territories are able to maintain their progress towards a welcome normalisation of social and business activity.
Until next week, stay safe.
CEDA – the Committee for Economic Development of Australia – is an independent, not-for-profit membership organisation.