Statement by Mark Goodsell
Ai Group NSW Director

"The NSW Budget has delivered a welcome return to surplus but has missed opportunities to make greater inroads into boosting the State's competitiveness," Ai Group NSW Director Mark Goodsell said today.

"On the positive side, the Budget demonstrates some progress by the Government towards meeting the fundamental objectives of containing expenditure growth, improving the State’s financial position and lowering business costs.

"The Government also correctly recognises the importance of improving the supply of housing in NSW as a key social and economic imperative. We welcome initiatives aimed at freeing up existing underutilised housing and stimulating new housing development. This will support both industry and jobs growth along the housing supply chain, including manufacturing.

"The unexpected boost to its revenue base from increased stamp duty and GST receipts has been directed towards deficit reduction, providing limited business tax relief and boosting housing construction. However, with NSW industry still facing a patchy recovery, the revenue gains could have been better used in helping to shape and secure a more competitive business sector in uncertain times.

"We are pleased that in a tough economic environment, the Government has taken the positive step of helping to alleviate the payroll tax burden on NSW businesses. This is an important measure, particularly in the context of the tough and unrelenting competitive pressures facing industry in both domestic and international markets.

"However, more needs to be done. The improved Budget position indicates that there is scope for more aggressive cuts to payroll tax to move it more into line with the other states. Further action in this area is critical if we are to send a clear signal that NSW is supportive of business investment and growth.

"A continuing long term objective should be to ensure that we get value for money from the Government sector in NSW. The Budget reveals that growth in NSW public sector wages is significantly higher than in other States, and well above private sector wages in NSW. Urgent and concrete action in controlling the public sector wages bill is needed to pave the way for further tax relief.

"Ai Group welcomes the NSW Government’s commitment to a strong infrastructure investment program given the importance of high quality infrastructure in supporting industry growth, and the substantial flow-on effects for businesses in the State’s manufacturing, construction and services sectors.

"It's important that the Government ensures that competitive locally-based suppliers know about and have the opportunity to bid on these projects. We will be pressing for this in the roll-out of all major capital works," Mr Goodsell said.

Further Comment: 
Mark Goodsell, Ai Group: 02 9466 5523
Media Enquiries: 
Tony Melville - 02 6233 0700