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First Albanese Budget – What’s in it for retail?

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By Published On: October 26, 20220 Comments

The Australian Retailers Association (ARA) has welcomed the Albanese Government’s first budget for its social reforms. ARA CEO Paul Zahra reacts to the budget priorities amidst an uncertain global economic outlook and growing cost of living pressures.

“The Albanese Government’s first budget has been handed down with a backdrop of increasing global economic uncertainty and growing cost of living pressures,” said ARA CEO Paul Zahra. “Inflation is forecast to peak at 7.75% later this year and our economy is set to slow to 1.5% growth in 2023-24, highlighting the scale of the challenges that lie ahead for business and all Australians.

“With many households facing financial stress, we’re pleased to see the cost of living a key focus,” he said. Zahra commended the Government for embarking on these bold social reforms and for making women and gender equality a budget priority. “The $7.5 billion package which includes cheaper childcare and the expansion of paid parental leave will help ease the pressure on families and improve the economic participation of women – a key focus for retail, given the sector has one of the highest percentages of women in its workforce.” Paid family and domestic violence leave is identified by the ARA as another important area of social reform focused on cost of living support for families.

Zahra notes that the ARA is “cautious about the economic outlook as the impacts of rising interest rates wash through the economy and as households tighten their budgets, which could lead to a slowdown in spending in 2023.” While retail remains resilient and adaptable to these challenges, Zahra identifies that an immediate challenge for retail “is the jobs and skills crisis, which is worsening in our sector with job vacancies at over 46,000 and one of few industries that recorded an increase in vacancies last quarter. We acknowledge the $1 billion agreement to provide 180,000 TAFE and vocational education places in 2023 but seek clarity on how these will target traditional retail skillsets.”

The ARA has been advocating for funding to speed up visa processing times and allowing pensioners to earn more without their entitlements being affected. They acknowledge that the government is following through on these commitments with the goal to get skilled people into country and the workforce, as well as harness existing skill and talent in Australia.

$62.6 million in grants have been announced to help small business become more energy efficient. “We would like to have seen more targeted support to help these businesses with cash flow challenges,” Zahra states. “Continuation of the instant asset write-off and 20 percent tax deduction boost for small businesses to upskill employees and support the uptake of new technologies will also help improve digital capability and productivity. We also advocated for and welcome the $3.4 million over four years to support small businesses to understand and implement this legislation.”

Looking to the future, “the next great disruptor for the retail sector and the Australian economy is climate change, and we welcome the resilience measures in this budget to help with climate change and disaster preparation, as well as changes to support electric car use by business and the community.”

“We commend the Albanese Government on their first budget, however there’s no doubt that challenging times lie ahead with the prospect of a global economic downturn.”

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About the Author: Rosalea Catterson

Rosalea is the Editor of Power Retail. With a keen interest in consumer behaviour and tech, she covers everything ecommerce and hosts the Power Retail Power Talks Podcast.

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