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Federal Budget: Industry aspirations and expectations for 2021-22 Budget

The national employer association Ai Group has outlined its aspirations and expectations for next week’s Federal Budget.

Ai Group Chief Executive, Innes Willox, made the following comments on the budget context and priorities for Industry:

Budget priorities

“As we argued in our Budget Submission, both to address the areas of emerging skills shortages and for the benefit of longer-term productivity, the budget should prioritise education and training and support this with measures to ease open the tap for permanent and temporary migrants.

“Education and training measures include:

  • Extending the successful support to employers hiring to apprentices and trainees
  • Support unemployed people’s efforts to improve their employability and job-readiness;
  • Recalibrate the JobMaker hiring credit including by adding a skills dimension
  • Introduce a program of cadetships that better integrates higher education and work.

The economy

“While areas of distress remain, and unemployment and underemployment remain too high, the aggregate economy is on track to recovery and, increasingly, businesses are reporting areas of skill shortages and difficulties recruiting including for less-skilled jobs.  

“There also remains a fundamental need to revive Australia’s lagging productivity growth.  With population growth now out of action for at least a couple more years, even greater emphasis needs to be placed on productivity growth.

Greater efforts should also be directed to look for further increases in workforce participation.  Measures include lifting the availability and affordability of childcare, improving opportunities for older Australians to remain in the workforce and raising opportunities for people with disabilities.

Fiscal stimulus?

“There remains a strong case for programs to support employment and businesses in areas of activity that continue to be severely affected by COVID restrictions (particularly those reliant on international travel) such as announced for aviation and tourism.  These programs should be targeted and be designed to flow along the supply chains of the affected areas of activity.

“With considerable stimulus remaining in train the broader case for additional stimulus has weakened.

  • The stimulus in train includes infrastructure spending; wage subsidies for apprentices, trainees and for younger people who were previously unemployed; and the personal income tax cuts announced in the 2020-21 Budget including the extension of the Low and Middle Income Tax Offset (which will be received by households early in the months from July).

Easing open the immigration tap

“Industry and other employers are experiencing skill shortages and there are areas of shortage of less-skilled labour in many regional areas.  Easing open the tap on international inflow is critical to address these constraints and to broaden activity and employment across the broader economy.

“While community health outcomes rightly remain a priority, there is a very strong case for the Commonwealth to provide support to the states and territories willing to expand their quarantining capacities.

“The federal government can also relax restrictions on in-country temporary residents including by opening more paths to them becoming permanent residents.

Addressing productivity

“Ai Group’s recommendations for the 2021-22 budget in this area include:

  • Supporting the development of digital capabilities (including in relation to cyber security) among Australia’s SME’s
  • Supporting the revival of non-mining business investment. 
    • The case for reducing Australia’s relatively high rate of company tax as part of a broader set of adjustments to taxation arrangements is well worth reconsidering.
    • In the meantime, extending the availability of the immediate expensing of capital equipment beyond July 2022 would help bring-forward plans for additional investment,” Mr Willox said.


Media enquiries: Tony Melville – 0419 190 347