Chief Minister Andrew Barr will hold out the hope of more support for Canberra’s struggling businesses as it continues to focus on job creation and economic recovery from the impacts of COVID-19.
In his opening speech to the Legislative Assembly today, Mr Barr will set out his government’s agenda for the year, including continuing to drive towards full employment and continuing the ACT’s 30-year record of sustainable economic growth.
But it will mean budget repair will have to wait.
“We head into 2022 cautiously optimistic, with household consumption expected to bounce back rapidly once the impact of the Omicron variant subsides and international migration and travel begins to increase,” he will say.
Mr Barr will say that despite a significant recovery in retail figures, the government acknowledges the record consumer spend in 2021 was not uniform and that some areas of the economy have benefitted more than others.
This meant the ACT Government recently extended existing business support measures to targeted industry sectors, such as food service businesses and tourism and hospitality, and may offer more if needed.
“We will continue to monitor our health and economic data over the coming weeks and months as we take a considered and informed approach to exploring any further support,” he will say.
This may not be enough to appease businesses that are hurting due to ongoing restrictions.
The Canberra Business Chamber says almost three-quarters of businesses have said in a poll that they were more concerned about the impact of COVID-19 on the broader economy than they were in December last year.
Over two-thirds were more concerned about their business than in December 2021 and 10 per cent said their business was no longer viable.
But the Chief Minister is upbeat about the coming year, backed by a public investment program that has provided more than $500 million in additional health funding, allocated over $475 million in targeted small and medium business support and more than $200 million in additional funding for education and skills.
He says this public investment has delivered incredible economic outcomes – the ACT’s real GSP growth for 2019-20 was 3.7 per cent, and for 2020-21 it was 2.8 per cent.
“Our economic recovery plan will be front and centre of the ACT Government’s work in 2022,” he will tell the Assembly.
“The plan is focused on creating and protecting good local jobs – in a diverse range of industry sectors including health, education, construction, retail, renewable energy, tourism and hospitality, and technical, scientific and professional services.”
Mr Barr will say that public spending to support the economic recovery will continue, ruling out any return soon to a balanced budget or better.
“The path back to budget balance will continue to be a focus for the government over the medium term,” he will say.
“However, the need to continue to support the economic recovery and position Canberra to respond to a range of opportunities as we emerge from the pandemic currently outweighs the need to balance the budget in the next few years.”
Part of this will focus on assisting the young and Mr Barr will say that investment in education, skills development and ensuring economic opportunities for young people is critical to the ACT’s long-term economic strength.
Infrastructure projects will also play a critical role, including light rail, the Canberra Hospital expansion, the Woden CIT project, new schools and major bridges, such as the one across the Molonglo River in the Molonglo Valley.
Mr Barr will say the ACT’s public health response has underpinned the economy’s resilience, including nation-leading high vaccination rates, but Canberra can expect more efforts to get boosters into the arms of as many possible.
“We are also leading the way in providing boosters, with more than half of all eligible Canberrans now having received this extra dose,” he will say.
“However, this is not enough – we must boost as much of our population as possible.”
Mr Barr will also commit his government to an ambitious and progressive legislative program.
“For more than two decades, this jurisdiction has advanced nation-leading reforms that have ensured Canberra remains one of the most liveable, inclusive and progressive cities in the world – and that will continue in 2022,” he will tell the Assembly.