Federal election 2013: how will your industry be affected?
As election day approaches, IBISWorld weighs in on key Labor and coalition policies — and the industries they will affect.
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Both Labor and the coalition have pledged support for many substantial infrastructure projects across Australia, which is highly dependent on road and rail transport.
The largest item on the agenda is the flood- and accident-prone Bruce Highway in north Queensland, with the coalition pledging $6.7 billion over 10 years, which is $2.6 billion more than Labor. However, Labor is expected to commit an extra $300 million to Sydney's WestConnex project to link the M4 and
M5 motorways on the condition that an extra link to the CBD is created. Other projects include the Gateway Motorway in Queensland, F3/M2 link in New South Wales, South Road in South Australia and Midland Highway in Tasmania, all of which are expected to receive similar funding pledges from both parties.
In terms of rail, Labor has argued the federal government should contribute to urban rail systems while the coalition maintains that state and region-based urban rail systems are not the responsibility of the federal government.
Also on the agenda for both parties is the proposal of a high-speed rail network across Australia. Despite mutual agreement on the economic benefits of high-speed rail, public funding would be difficult to attract and construction would likely take several decades.
Australia's manufacturing sector is always a significant issue on the election agenda. Both parties are concerned about the diminishing health of manufacturing in Australia, but their policies on how to revive the sector differ. Debates tend to be approached from four vantage points: anti-dumping, industrial relations, regulation and access to energy and resources.
Dumping occurs when an exporter sells goods in a foreign country below the cost of manufacturing them in a domestic country. Labor has established the Anti-Dumping Commission, while the coalition aims to make changes to the Customs Amendment Bill 2013 and impose Australian standards on imported goods. This is designed to further protect the local manufacturing industries.
Regulation of the sector is also under the spotlight. Both parties agree on cutting down the red tape associated with manufacturing. However, how each will achieve this is not specified. The Labor Government attempted a cut in corporate taxes, which was to be funded by the mining tax.
Since the returns from the mining tax were lower than expected, the cut was scrapped. The coalition has promised to cut the corporate tax by 1.5 per cent, if elected. Additionally, the coalition has promised to reverse the cuts made to R&D tax concessions for businesses with revenue of over $20 billion.
Both parties aim to increase the participation level of domestic manufacturers in local projects. Labor plans to introduce a policy whereby government projects in excess of $500 million will have to demonstrate that they gave local companies a chance to bid for tenders. Additionally, international companies with projects over $2 billion will have to include domestic suppliers in their operations.
The coalition aims to introduce an approach that is based more on tender, hoping to encourage small business participation.
Australia's automotive industry will be the focal point of policy debate concerning the manufacturing sector during the lead-up to the election. Both major parties support at least some level of subsidies for automotive manufacturers. Labor has pledged to increase the level of subsidies but to make changes to Fringe Benefits Tax advantages for company cars.
These changes will have an adverse effect on the domestic automotive industry, but Labor plans to compensate the industry with a further $200 million worth of subsidies, bringing total automotive industry subsidies to $2.7 billion.
The coalition plans to cut subsidies to the automotive industry by $500 million, reducing the total subsidies to $2 billion between 2011 and 2020. However, the coalition will not change the Fringe Benefits Tax for company cars.