Budget 2018: more commitment, more competition, more co-operation

09 May 2018

The Business Council of Co-operatives and Mutuals (BCCM) is pleased to note the ongoing commitment to the co-operative and mutual sector by the government, demonstrated in this year’s federal budget.

Small and Medium Enterprises Export Hubs to develop more enterprise co-ops

The $20 million funding for Small and Medium Enterprises Export Hubs so businesses of any types can form ‘clusters’ to access larger markets acknowledges the success of the co-operative enterprise model used by Hunternet, BCCM members CBH, AlmondCo and Norco. Individual businesses form supply chains to reduce freight costs and access new markets, including burgeoning international trade options.

“The four year, $20 million Small and Medium Enterprises Export Hubs program will enable the development of more enterprise co-operatives to gain access to export markets,” said BCCM CEO Melina Morrison.

“We would like to see every farmer thrive in the way the producer-owners of Australia’s $3.27 billion co-op grain handler CBH do. Enterprise co-operatives strengthen communities and play a significant role in ensuring that Australians continue to profit from global demand for Australian-grown produce.”

Enterprise co-ops help Australian farmers compete against organisations that are many times their size, by realising economies of scale across their supply chains. Australian local supply chains help Australian firms, particularly those without the necessary economic and operational scale, compete against larger multinational corporations.

“The BCCM is very pleased to see government acknowledge the systems Australia’s rural sector uses already,” says BCCM CEO Melina Morrison.

NDIS labour market development fund

As demand for carers grows, the NDIS labour market development fund worth $60 million is welcome.

Thankfully, co-operative and mutual entrepreneurs already anticipated this looming workforce shortage, and have been busy setting up equitable employment structures in this space.

“Carers are frequently highly altruistic individuals motivated by more than remuneration alone. Co-operative models offer carers the autonomy and flexibility to serve the people in their care as best they can,” said BCCM CEO Melina Morrison. “Worker co-operatives like BCCM member The Co-operative Life also incentivise traditionally low-paid care work by giving the carers a share in the business. They can get on with the work they are already doing in helping other Australians.”

Affordable housing

The Government will provide $4.8 million to the Australian Bureau of Statistics for affordable housing stock estimates, and $5.5 million to continue research into housing and homelessness policies.

“There are 177 housing co-operatives already delivering affordable housing using the common equity model with support from BCCM members Common Equity Housing Ltd and Common Equity NSW,” says BCCM CEO Melina Morrison. “The housing co-operative model is robust. It delivers affordable housing across the ownership spectrum, from full ownership to secure tenancy, with flexible options for low-income, first home owners, last home owners, and key service workers.

“Our members welcome accurate statistics on affordable housing stocks so that this much-needed housing will get to the people who need it fairly and quickly.”

Business registry reform

An announcement of $20 million for this financial year to reform business registries addresses the recognition and regulatory barriers faced by co-operatives.

“Co-operatives and mutuals account for 8 per cent of Australia’s GDP, but to accurately total the number operating in Australia right now would require a joint effort between State Registrars, the ATO, the ABS and ASIC,” said BCCM CEO Melina Morrison.

“Business registry reform will help co-operatives and mutuals currently building Australia’s future without proper recognition. Our businesses often miss out on funding they would otherwise be entitled to, due to irregularities in the way companies are recorded.

“Government can use monthly company statistics to gauge effective policy, but can’t do the same sort of impact assessment on our sector. Centralised and useable data will provide them with the insights they need to consider our businesses when developing new policy.”

Regional Employment Trials

The government has announced 10 place-based Regional Employment Trials worth $18.4 million with grants of up to $1million in each region for employment initiatives.

“The McClure Review into Welfare Reform pointed to co-operatives as a a solution to reduce welfare dependence, provide jobs for local people and use procurement practices that support local business,” said BCCM CEO Melina Morrison. “This is an excellent opportunity for BCCM’s regional members to further cement their role as local employment champions.”