Tim Reed, the former long-time boss of tech firm MYOB, is set to become the president of the Business Council of Australia, highlighting the growing influence of the modern economy on the nation’s big firms.
Reed has been unanimously recommended by the BCA’s board to replace Grant King, who is stepping down after three years in the role, and as such is expected to be endorsed at the BCA’s AGM on November 20.
Reed said he is “honoured and privileged” for this opportunity, having joined the board of the peak group for large businesses in 2017.
“The key thing for the BCA is to continue to prosecute the case that a competitive economy is what allows all Australians to prosper,” Reed told reporters ahead Friday’s formal announcement.
He believes the top three challenges facing business and the BCA are skills shortages, regulation and the tax system.
He said state and federal governments must have the right policies in place for skills both in terms of migration and the education system.
Regulation must also help Australia to be competitive and not be stifled by red tape, while the tax system must encourage investment, particularly business investment.
He said it is important that company taxes continue to be examined, but acknowledged the government won’t return to the issue of reducing the 30 per cent tax rate for big business in this term.
However, he said in a majority of Australia’s 28 years of uninterrupted economic growth the company tax rate was below the OECD average but is now in the top quartile.
“I think believing we are going to have decades of economic growth while our company tax rate sits in the top quartile is naive,” Reed said.
“We intend to make sure it remains on the agenda.”
However, Reed does not believe the federal government should jump in with a round of stimulus measures in the face of a slowing economy.
“You have got monetary policy, you have fiscal policy and then you have regulation. We think the focus should be on the third of those,” he said.
He said the government has worked hard to get a surplus and won an election promising one and should be allowed to prosecute those policies it took to that poll.
But he is not impressed by the government’s so-called ‘big stick’ legislation that would force energy firms to be broken up if they fail to deliver cheaper energy prices.
He said the BCA has already spoken openly against forced divestments, believing it won’t bring down power prices while creating sovereign risk.
“We also acknowledge the government took that policy to the electorate. Therefore we are trying to ensure that the legislation is framed in a way that it does the least harm that it possibly can,” Reed said.