Can Queensland afford to miss the opportunity?
The central question Queensland’s political leaders need to ask themselves as they plot our economic recovery must be ‘can we afford to miss the opportunity?’
Yes, the government needs to invest in public infrastructure to create jobs and build momentum in the economy. Yes, the government needs to slash the mounting red and green tape which has become a major burden across all sectors. And yes, we need targeted support for those industries hardest hit, such as tourism. These are a given.
But they are unlikely to be enough given the scale of the task. To lift the trajectory of our recovery in the coming years, we will need to attract large scale private investment.
The type of investment that comes in packages of tens, or preferably hundreds of millions of dollars and sparks employment in new projects and new industries. The type of investment that can go anywhere in the world and lands where the economic and policy settings are the most attractive.
Fast-tracking and locking in this investment must be a key pillar of our economic recovery strategy.
But it is going to require a series of bold and ambitious policy moves – we cannot afford to run out the same old policy playbook.
Jurisdictions across Australia - and around world - are already taking action to secure first mover advantage. They know it is a competition to secure this investment to fuel their economic recovery. And they intend to win.
Take for example the NSW Government’s recent announcement to halve the land tax rate and remove any foreign tax surcharges for investors in new ‘build-to-rent’ housing projects. This will mean investors in these large-scale privately funded projects will have a land tax rate of 1% in NSW, versus potentially a 4.75% rate in Queensland. The decision of where to invest suddenly becomes obvious.
This example points to the impact a series of property tax hikes in Queensland have had on our investment competitiveness in recent years. These tax hikes are now a serious barrier to our economic recovery.
So tax is clearly one area where bold action must be taken to attract job-generating investment. But there are many more opportunities in areas such as partnering with the private and not-for-profit sectors to deliver more social housing, reforms to facilitate the redevelopment of crumbling strata buildings and unlocking underutilised government land, to name just a few.
We have seen both the Government and Opposition make announcements that are a step in the right direction. The Government with their Building Acceleration Fund, and the LNP with their plans to revamp Market Led Proposals and establish a second Coordinator-General.
But bigger, bolder changes to the Queensland Government policy playbook will be needed to unlock the potential for private investment to work in parallel with government investment to fuel our economic recovery.
If we don’t make some courageous decisions, we risk being left on the starting blocks as other jurisdictions run away with the prize.
Clearly, Queensland cannot afford to miss this opportunity. So, let’s get on with it.