Co-operation is key to economic recovery

06 October 2020

The Business Council of Co-operatives and Mutuals today welcomed the 2020/21 Federal Budget with its focus on job creation and business enablement.

BCCM CEO, Melina Morrison said the Australian co-operative and mutual sector was responsible for almost $100 billion in economic activity in 2019 and would be a key player in Australia’s economic recovery.

“Today’s budget presents an opportunity for Australia to work together and rebuild the Australian economy. With a focus on jobs in agricultural exports and value-adding manufacturing, this budget looks to business to lead Australia’s recovery,” Morrison said.

“Our members, Australian co-operatives and mutuals, will look to this budget to plan their future investment and work with their members to identify the best opportunities to provide sustainable and ongoing returns.

“Importantly, co-operatives remain a model that can provide inspiration for others on the path to recovery. There is a reason that some of the nation’s biggest co-operatives and mutuals were formed after periods of economic adversity. A challenge is always easier to face when faced together, as a community of farmers, customers or manufacturers.

Morrison said BCCM would continue to work with the Government to remove regulatory burdens and address barriers to capital raising, allowing co-operatives and mutuals to operate on a level playing field and play a larger role in the national recovery.

A highlight of the Budget is the $1.3bn Modern Manufacturing Initiative which is enterprise led and focused on building long-term business collaboration to help local firms to deliver products and services into global value chains.

“Long-term business collaboration is the DNA of co-operatives which exist to integrate local firms into globally significant exporters and scaled manufacturers. Our Budget Submission  outlined how co-operatives can lead the recovery effort to scale local manufacturing through incentivizing local firms to form co-operative clusters.

“BCCM is pleased to see the Government has recognised the need for SME collaboration in manufacturing and we look forward to working with Government on the industry roadmap.

“Australia’s recovery absolutely depends on setting the expectation that our regional communities should not simply be surviving, but thriving. This means providing the infrastructure through which local businesses can co-operate to compete on a global stage.

“Australian owned manufacturing protects our economy from the vagaries of international political relationships and the devastating effects of global crises, whether resulting from a pandemic or a weather event. It puts Australia in control of its own destiny.”

Michael Hampson, CEO of Australia’s last significant farmer-owned dairy processor, Norco, said “Norco employs over 850 employees and turns over more than $680 million per year as a 100% farmer owned co-operative. Through Norco’s manufacturing facilities we service local and international markets with milk and other high-quality dairy products. Lower energy costs and better access to capital will help us to add more value, export more products and employ more people in Northern NSW and SE Queensland.”

Melina Morrison said, “Co-operatives and mutuals are by definition locally owned and operated. They are taxed domestically reinvesting all surpluses back into the economy in which they operate. Co-operatives facilitate the kind of investment that not only allows new manufacturing to flourish but also prevents the off-shoring of profits,” said Morrison.

Read the pre-budget submission