Rich lister and business heavyweight Raphael Geminder says Australia faces a make or break federal budget as the Morrison government seeks to reboot the economy which has been savaged by the coronavirus pandemic and get people back to work.
Mr Geminder, chairman of the ASX-listed packaging company Pact Group, said he was comfortable with the ballooning budget deficit given Australia’s debt position compared with other nations, and the crucial need to boost economic activity.
“This budget is about rebuilding Australia. It’s about reinvesting in infrastructure and really, getting people back to work,” Mr Geminder said.
“There hasn’t been a more important budget and quite frankly this is, in a sense, a make or break budget because our recovery relies on it,” he told The Age and The Sydney Morning Herald.
Mr Geminder said that in a “benign”, low interest rate environment Australia could afford to re-calibrate how it considered debt. “Everything is about relativity and if you think about how much debt we’re taking on relative to the rest of the world, we’re in pretty good shape in Australia.”
This budget is about rebuilding Australia. It’s about re-investing in infrastructure and really, getting people back to work.Raphael Geminder, chairman of Pact Group
Tuesday’s big spending budget will be critical to how fast the economy recovers from the coronavirus-induced recession. This financial year’s budget deficit is expected to be a record $220 billion.
The government has already confirmed a range of budget initiatives including billions of dollars of infrastructure spending, and $1.5 billion of grants to promote manufacturing in priority areas such as food and beverage, defence and space, and resources and critical minerals.
It will also include more than $1 billion in wage subsidies for employers to take on 100,000 apprentices, and is expected to bring forward personal income tax cuts.
“The government has been measured, they’ve taken a lot of advice, they’ve been very thoughtful about how they spend, effectively, our money,” Mr Geminder said.
“This is a great opportunity to upgrade the country and as you upgrade the country you put people to work, you upgrade infrastructure and you make the place a better place to live in,” he said.
Coca-Cola Amatil boss Alison Watkins said Australia had handled the COVID-19 crisis well compared with other countries.
“Budget measures need to focus on getting the Australian economy moving again and putting the country firmly on track for future growth and success. Every dollar spent in the budget needs to focus on creating new jobs, increasing investment and driving productivity in order to grow the economy in an enduring way,” she said.
Ms Watkins said the recent budget announcements from the federal government had been positive.
“Importantly the government has acknowledged there needs to be strong underlying fundamentals in the economy for businesses to thrive. This includes a competitive tax system, fostering domestic and international trade relationships, investing in skills and having the appropriate industrial relations settings in place – all designed to boost productivity and create jobs,” she said.
Ms Watkins said the federal government’s manufacturing plan would help businesses grow and “create much-needed jobs”.
Source: Thanks smh.com