The purse strings may soon be relaxed if the state’s 2010-11 financial performance turns out to be better than expected.
AS Colin Barnett’s Liberal-National alliance approaches the final 18 months of its first term in government, there are some rumblings from a most unlikely source, with the state’s major employer lobby group becoming impatient over lack of action in key areas for its members.
The Chamber of Commerce and Industry WA has accused the government of failing to honour crucial election promises made to small and medium-sized businesses during the 2008 election campaign. The main issues are tax cuts and red tape.
During the election campaign in 2008, Mr Barnett promised tax cuts of $250 million should the Liberals win the election. His government did provide an early one-off payroll tax exemption worth about $100 million over one financial year to counter the GFC, but business is becoming impatient for the rest.
CCI chief executive James Pearson says time is running out.
“Many employers not directly linked with the resources industry are finding current conditions tough,” he says.
“The longer WA continues to be the highest-taxing state in the nation on a per-capita basis, the longer WA firms will find it harder to compete with the rest of the nation and internationally.”
Mr Pearson says both the federal and state governments have a responsibility to remove inefficient taxes and charges, which he claims are holding WA business back.
At the state level that’s code for payroll tax, long criticised as a tax on jobs. It was earmarked to ‘go’ in the early days of the goods and services tax campaign but fell by the wayside as John Howard had to compromise to win the crucial support of the Australian Democrats to get the bulk of his GST package through.
But a cut in payroll tax, especially for small business, would go part of the way in pacifying the CCI. And there’s always scope for easing stamp duty and land tax rates when the economy is performing well, although it’s not exactly happy days in all sectors.
Red tape has been as big issue for small business for years. Successive governments have promised to cut it, with limited success. I remember (then) Labor deputy premier and small business minister Mal Bryce launching Small Business Week by symbolically – for the TV cameras – cutting the red tape around a mountain of booklets containing relevant legislation and regulations. That was in 1984.
All governments make a fuss about red tape and this one is no different. Early in its current term, Liberal MPs Ken Baston and Liza Harvey were charged with preparing a report on areas where regulations were hampering industry. The report was duly completed and handed to Treasurer Christian Porter. Clearly the CCI is becoming impatient.
Also impatient is the opposition. It is still waiting for the promised legislation for a lobbyists’ register – though it is said to be ready soon. And National Party leader Brendon Grylls promised significant rent concessions for teachers, nurses and police officers in regional WA, which have yet to eventuate. Then there’s the Ellenbrook railway line, which had been earmarked for construction should the Liberals win a second term, but has since been shelved.
It’s one thing for a party to make promises to win votes during an election campaign; should that party subsequently win power, the people who put it there expect the promises to be honoured. It’s all a matter of credibility.
Mr Barnett has foreshadowed the imminent release of the state’s financial performance for 2010-11, and the current position, hinting that they will be far stronger than many people thought possible.
If that’s the case, don’t be surprised if the purse strings are soon relaxed somewhat, with a few sweeteners starting to flow. Voters have just been through three long years with few concessions in taxes and charges. A modest slice of largesse just might make them more partial to giving the current administration a second term.
Mr Barnett, however, who before entering politics was the executive director of one of the CCI’s forerunners, – the WA Chamber of Commerce –would be unwise to ignore the warnings from his old colleagues.
With the election countdown getting closer, he would want to have them well and truly in the tent as he promotes WA as a good place to do business.
Early poll planning
THE next federal election might not be held for almost two years, but planning for new candidates in safe seats is already well under way, within the WA Liberal Party at least.
The Liberal strategy has been helped by the early announcements from two veteran MPs – Judi Moylan in Pearce and Mal Washer in Moore – that they do not intend nominating for re-election. So behind the scenes jockeying for two almost certain Liberal seats in the House of Representatives has been on in earnest.
However if you are a Liberal supporter and tempted to put your hand up for Moore, which takes in Perth’s coastal suburbs north of the Cowan electorate, it’s too late.
The early mail indicates the nomination is all but signed, sealed and delivered. Land and property developer Ian Goodenough, who has been president of the Moore division of the party for the past four years, has emerged as a short-priced favourite to win Liberal endorsement.
Mr Goodenough is said to have the support of both Dr Washer and the previous Moore president, Senator Michaelia Cash, and has helped develop 12 constitutional Liberal branches in the electorate, with more than 400 members. And the division is well funded, making donations to campaigns in other seats, plus kicking in $7,500 to the last federal Liberal campaign fund.
Dr Washer has built up a comfortable margin of 11.2 per cent in Moore. But the position in Pearce, where Ms Moylan produced a buffer of 8.9 per cent, is less clear-cut.
The names of several strong contenders are in the mix, including lawyer Lorraine van der Ende, who has worked in Canberra, and prominent lobbyist Dean Smith, who has been director of policy for former prime minister John Howard and former premier Richard Court.
Mr Smith has been state Liberal treasurer for the past five years and is senior vice-president of the Pearce division. He has also been mentioned as a possible contender for a Senate seat. That means the endorsement ballot for Pearce early next year is almost certain to be hotly contested.
The remaining nine federal Liberal MHRs are expected to renominate and be endorsed. The same goes for Labor’s three MPs.
The National Party’s Tony Crook will face a hot challenge from Katanning farmer Rick Wilson, who has already been endorsed by the Liberals in an attempt to regain the Wheatbelt seat of O’Connor. It had been a Liberal stronghold for 30 years until Wilson Tuckey’s surprise defeat in last year’s federal poll.
