At the time of writing, New Zealand has tipped into a technical recession, following a second consecutive quarter of negative gross domestic product (GDP) growth in the first three months of this year. Growing numbers of economists predict Australia will follow, with the risks of a recession heightened after the Reserve Bank of Australia’s surprise interest rate rise in June – the 12th since the May 2022 federal election – in a bid to return inflation to the 2%–3% target range.

Despite deteriorating domestic economic conditions and global geopolitical uncertainty, Treasurer Jim Chalmers’ first Budget in October last year improved the deficit position by A$41.1 billion. And, the ‘affordable and responsible’ first full-year Budget delivered on 9 May forecasts Australia’s first surplus in 15 years, thanks to low unemployment, wage growth and surging commodity prices.

The Labor government has moved at pace during its first 12 months in power to start to deliver on its election pledges, taking a consultative approach which has been appreciated.

Solid progress

Labor’s headline achievements during the past year, which are aligned with Chartered Accountants Australia and New Zealand’s election manifesto, include commencing the task of budget repair, legislating greenhouse gas emissions targets, convening a national jobs and skills summit to address barriers to employment and productivity growth, and passing legislation through the lower house for a referendum on a First Nations Voice to Parliament.

The jobs summit attended by CA ANZ last September resulted in many outcomes we advocated for, such as increasing permanent migration program places to ease critical skills shortages, resolving the skilled visa processing backlog, and supporting women’s workforce participation by extending paid parental leave, making child care more affordable and paid parental leave more accessible, fair and flexible.

Opportunities for improvement

As the government continues to navigate the economic tightrope, it must manage short-term issues and progress the long-term reforms required to build Australia’s prosperity. The May Budget relies heavily on Australian Taxation Office compliance activities to raise revenue. This will be helpful in the short term but won’t be enough to address the nation’s complex, ongoing structural funding problems over the long term.

CA ANZ would like to see the Labor government and the opposition have the courage to take an ambitious tax reform agenda to the next election.

“CA ANZ would like to see the Labor government and the opposition have the courage to take an ambitious tax reform agenda to the next election.”

A clean energy economy

One of the big opportunities the government is backing for Australia’s future is the transition to a clean energy economy. Part of this includes the establishment of a mandatory and internationally aligned climate-related disclosures regime, in which accountants, auditors and financial professionals have a significant role to play.

CA ANZ is also advocating for the government to establish an adequately resourced, standalone Australian Sustainability Standards Board (ASSB) to oversee the development and publication of sustainability standards. We are encouraging Australia to mirror the structure of the International Sustainability Standards Board, creating a separate ASSB under the Financial Reporting Council, and alongside the Australian Auditing and Accounting Standards boards.

Overall, the government has made some significant progress in year one. Ongoing collaboration and consultation – as well as a courageous approach to the reform work that still needs to be done – could lead to even more impressive outcomes in year two.

CA ANZ’s 2023 policy priorities

CA ANZ has updated its policy priorities for advocacy, with input from members. Visit the CA ANZ website to find out what’s changed, what’s new and download our 2023 policy priorities.

Member feedback on this advocacy column and our policy priorities is welcome, and can be emailed to: [email protected]

Keep up to date with advocacy

We will be exploring other advocacy topics in future editions of Acuity. Look out for an update on CA ANZ’s advocacy work in the Oct/Nov issue, or visit: https://www.charteredaccountantsanz.com/news-andanalysis/advocacy to access policy submissions online.