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Ai Group response to PM's address to the National Press Club

"The Prime Minister's warning of the likelihood of a prolonged period of recovery from the COVID-19 crisis is a timely warning that we are not yet out of the woods. If past experience is any guide, we are at risk of a multi-year period of high unemployment with particularly severe impacts on young people. It will take several years for many businesses just to regain lost ground while some will not survive," Innes Willox, Chief Executive of the national employer association Ai Group, said today.

"It is pleasing that the Prime Minister has delivered a roadmap to deal with two of our biggest challenges. To resolve them and set Australia up, we will need to ditch ideology and think of the best outcomes for both employers and employees. This will need collaboration and a determination to put the national interest rather than sectoral interests first. Ai Group looks forward to playing our part on behalf of Australian industry in seeking to deliver on the two key objectives outlined today.

"The Prime Minister is right to emphasise that the emergency fiscal support that is ultimately provided by Australian taxpayers is finite and that our economic and social prosperity relies on the re-emergence of sustainable employment opportunities and competitive businesses that can thrive without protection in the world economy.

"We welcome the priority the Prime Minister has attached to improved workplace relations and a much better-functioning and more responsive approach to education and training.

"A more flexible and productive workplace relations system can be achieved, without compromising fairness. The focus needs to be on boosting productivity, growing jobs, encouraging investment and restoring economic growth. There are some key areas that need urgent attention including addressing the current uncertainty around casual employment, simplifying the award system, and fixing the problems with the enterprise agreement system. We are pleased that these areas and others have been placed on the agenda for detailed discussions and we look forward to making a constructive contribution to the reform process.

"Ai Group is a keen supporter of the PM's plan to overhaul the VET system. This overhaul needs to be both ambitious and include additional funding. Current funding arrangements are unacceptably inconsistent and incoherent. A completely new funding agreement between the Commonwealth and the States must address efficient national pricing, and better coordinate the combination of subsidies, loans and other funding, as well as addressing the decade-long decline in overall VET funding.

"The VET system overhaul must not stop here. Work must progress at pace to implement the revised Australian Qualification Framework thereby enabling improved, fit-for-purpose contemporary vocational qualifications.

"Revitalising the apprenticeship will also be a key requirement of such reform. Ai Group has long been concerned about the languishing apprenticeship system and the decline in apprenticeship numbers. The COVID-19 crisis has exacerbated this. We have already lost over 15,000 apprenticeships since March. However, apprenticeship commencement numbers going forward are a major area of concern. Without substantial support Australia is facing a dramatic decline in apprenticeship commencements and an unacceptably high level of youth unemployment.

"While it is clearly true that the COVID-19 crisis is not a product of economic failure, it is equally true that the economy, while still growing, was not firing on all cylinders before the crisis hit. GDP was growing at much less than in the past, the steam had gone out of private sector job creation, disposable income growth was low, the level of business investment was disappointing and economy-wide productivity growth had largely disappeared.

"Even before the COVID-19 crisis hit there was much to do to facilitate productivity growth by rejuvenating business investment; lifting workforce skills, business capabilities and the pace of innovation; and becoming more efficient in the way we go about regulation. We also needed to map paths to rebuilding our energy advantage and achieving net zero emissions by 2020.

"The COVID-19 crisis has not taken these challenges away. Rather, it has added new challenges. We need to reconfigure our workplaces and work patterns and we have to adjust to new constraints on mass transport. Key industries face an uncertain future, we require greater resilience from our economy and the global supply chains on which much of our prosperity rests and we will need to develop new jobs and new competitive industries. Once again, we need to rebuild the sustainability of our public finances.

"In standing up to these challenges – both old and new – we should take considerable encouragement from the way our nation and our leaders have responded to the COVID-19 crisis. The country and the federation have come together and worked to common ends. A similar cooperative effort will be needed for our economy and our society to recover, rebuild and reposition," Mr Willox said.

Media enquiries: Tony Melville – 0419 190 347