Wednesday, August 21, 2013

Business lobby ramps up push for IR overhaul; ACCI says both major parties rapidly writing cheques with no money in the bank

So far this election campaign, the normally hot issue of industrial relations has barely rated a mention.

But behind the scenes, business lobby groups are ramping up their wish lists on IR reform regardless of which party wins on September 7.

The Australian Chamber of Commerce and Industry has today presented more than a hundred reform priorities to both major parties which includes an overhaul of the Fair Work Act.

But in the lengthy submission, the Chamber is urging the Coalition needs to get more aggressive about workplace reform if, as expected, it wins office.

The chamber's Peter Anderson says he is "not particularly" surprised that industrial relations has been taken the back seat during the election.

Listen to my interview with ACCI chief executive Peter Anderson.

"Because I don't think that the Government has you know a particularly good story to tell," he said.

"Because there's now been four or five years of experience with the Fair Work laws, and many of the claims the Government made about how those laws would apply to businesses, especially small and medium businesses, have not been met."

But Mr Anderson believes the Coalition needs to deal IR in an "orderly way".

"We know on industrial relations that the Federal Coalition has been very cautious and I think that there is still a very steep road for the business community to climb to convince the Coalition that there needs to be some significant changes to our employment regulation," he said.

"It needs to deal with these issues in an orderly way but it simply can't put them on the backburner.

"And the reason for that is that the Government's fair work laws, from almost all business perspectives, as well as independent perspectives, have swung the pendulum too far back towards centralisation and union power over bargaining."

Tuesday, August 20, 2013

Reserve Bank leaves door open to more rate cuts - but reluctant to say another is imminent

By Business editor Peter Ryan

The Reserve Bank has signalled that the official interest rate could remain on hold at a historic low unless there is a major deterioration in Australia's economic outlook.

In the minutes from the decision a fortnight ago to cut the cash rate to a 2.5 per cent, the RBA board appears to have settled on a neutral monetary policy stance with a bias to ease as required.

"Members agreed that the Bank should neither close off the possibility of reducing rates further, nor signal an imminent intention to reduce rates further," the minutes say.

The minutes from the RBA's August decision effectively rule out a pre-election rate cut when the Board next meets on September 3.

Listen to my analysis broadcast on The World Today.

"The Board would continue to examine the data over the months to judge whether monetary policy was appropriately configured," according to the minutes.

The RBA's decision to sit on the fence follows a raft of soft economic data with GDP expected to slow to 2.25 per cent and the jobless rate tipped to peak at 6.25 per cent.

However, the RBA says the further decline of the Australian dollar will be "important" in deciding the course of monetary policy.

The dollar "had declined since the previous meeting though remained high by historical standards" the minutes say.

The minutes add that further declines in the exchange rate would assist in rebalancing growth in the economy.

The minutes appear to signal that further rate cuts would require a material worsening of the economic outlook beyond the outlook in the RBA's recent Quarterly Statement on Monetary Policy.

Since the August meeting, Treasury release its Pre-Election Economic and Fiscal Outlook (PEFO) which confirms the outlook for slower economic growth, and rising unemployment.

The minutes shed little new light on the decline of the mining investment boom other than to confirm that business spending would be affected by a "turning of the cycle".