A letter to our new PM

The Hon Tony Abbott MP
                                                                                          
Prime Minister
Parliament House
CANBERRA ACT 2600

12 September 2013
  
Dear Prime Minister

Congratulations on a strong election win. I know you are focused on getting straight down to business. As a business advisor with three decades of experience and a client list representative of the key sectors contributing to our economy, I have been fortunate in gaining both the viewpoint and the ear of Australian business owners.  
 
Reflecting upon the 2013 election and the deficit you’ve inherited I can’t help but wonder, how your new government will manage the difficult balancing act ahead.  It’s almost assumed that you, like your Coalition predecessors, will return the budget to surplus - yet it’s equally clear the economy needs further stimulus to boost growth.  Under the circumstances, I’m sure you can see the benefits of “good” nation-building debt and the $770b widely regarded as the current investment backlog in Australian infrastructure is a good place to start to build the sort of road, rail and port projects that will remove bottlenecks and keep Australian businesses competitive.
 
One issue which stands out to me and which has not received much attention of late is our long term water supply. It would be great to see a long term strategy decided and steps taken to implement it such that we capture water and have the ability to pump it to where it is needed wherever that may be. I am sure with the engineering brains in this country this could be achieved using solar power and/or hydro generated power. No doubt ministers will be out drumming up investment from the private sector to support such projects in the hope of offsetting cuts to government services some fear will resemble recent European-style austerity.
 
Whilst we’re on the subject of investment, let’s consider education.  Like infrastructure, it is pivotal to Australia’s future growth, yet the numbers don’t quite stack up.  A shortfall of some 3.8 million skilled, post graduate qualified workers, coupled with the retirement exodus of baby boomers, places a huge resource burden on our already strapped education sector.  How will your government ensure affordable access to a well-rounded education as well as creating business-ready school leavers to plug the skills gap in our workforce?
 
Beyond the baby boomer generation, there’s bound to be a groundswell of self-funded retirees, which will put even more pressure on current tax concession legislation.  Unfortunately, this is just one example of a superannuation system that has had too many patch ups and partial fixes to make it really effective. I hope that amongst other tax reforms, your government will address the current imbalance and establish a more equitable system. Then leave it alone for a while.
 
New boots outside The Lodge do offer some hope for proper tax reform. Aside from the announced 1.5% cut to corporate tax the business community isn’t sure what to expect. Many will welcome any move towards a more all-inclusive tax system in which revenue raising goes beyond an extra slug on cigarettes and alcohol. Perhaps GST will get some much needed attention, as will other recommendations from the 2008 Henry Tax Review.
 
On the subject of paid parental leave, while few would argue about the importance of increasing female participation in the workforce, there are two looming question marks over your government’s rather generous policy – is it sustainable to limit the 1.5% levy that will pay for it to just the biggest Australian companies – or will the mid-market soon  have to pay? And if the coalition believes so deeply in this objective doesn’t it also have to tackle funding of a strained childcare system? 
 
I also have a personal interest in the disability sector being a board member of an organisation which provides services to people with disabilities and would therefore encourage continued work on the NDIS.
 
Shifting the fiscal focus without losing momentum is a challenge for any new leader, especially when you’re searching for common ground between opposing forces. While you remain committed to repealing the carbon tax, it could be a tough sell in what is shaping up to be a fragmented Senate.
 
There is a lot to do, and I am realistic enough to know that everything cannot be done in five minutes; however I encourage you to make a start as soon as possible.
 
Aussies are an optimistic bunch, always ready to give the new guy a fair go.  I say be true to your convictions and tackle the genuinely tough decisions that will help us grow our economy in the Asian century.
 
Yours sincerely
 
Doug Mitchell