Queensland budget boosts business confidence: CCIQ

Confidence has rebounded after a dip in the March quarter “as businesses realised that a change in the government does not necessarily mean a change in Queensland’s economic fortunes”, the CCIQ says. Photo: Glenn HuntWhat a difference three months can make.

On the back of the budget no one is talking about, Queensland businesses have reported a six-point bump in business confidence figures in the latest Chamber of Commerce and Industry Queensland Pulse survey, up from a six-year low of 37.7 per cent in the survey released following the election of the Palaszczuk government.

Confidence in the Queensland economy rose to 42.7 per cent in the Westpac Group CCIQ survey of 500 businesses between July 1 and July 17, but the state still lags behind confidence levels Australia wide, which stand at 48.1 per cent.

Treasurer Curtis Pitt’s first budget was delivered on July 14.

CCIQ Director for Advocacy Nick Behrens described business confidence as improved, but “fragile”.

“Businesses have responded positively to a state budget that provided more clarity on economic and fiscal policy direction,” he said.

“… Unquestionably, the federal and state budgets have boosted Queensland business confidence.

“Following the state budget announcement, there was 6 per cent increase in the proportion of businesses that expected the Queensland economy to strengthen over the next 12-months.

“It must be noted however, that the June quarter results are somewhat of a correction to the March quarter as businesses have realised that a change in the government does not necessarily mean a change in Queensland’s economic fortunes.”

But with the resource sector down, the drought, and “subdued” consumer spending, keeping that confidence up would be “challenging”, Mr Behrens said.

The Abbott government’s small business package also helped deliver that boost, Westpac Queensland business banking manager Peter Cooper said.

“We are seeing many small businesses taking the opportunity to replace or upgrade plant and equipment to secure future business prospects and increase revenue,” he said.

But Mr Pitt is taking the survey findings as a win.

“The CCIQ survey specifically acknowledges that business sentiment has improved on the back of a balanced state budget,” he said.

“It reveals that general business conditions improved in the June quarter and that businesses are more optimistic about our economic growth prospects.

“Business, industry, unions and community groups have welcomed our first budget and its positive plan to promote jobs, growth and investment.”

The Opposition is taking a wait-and-see approach, having criticised the government’s “raiding” of the public service superannuation pool to help meet its budget requirements, a move it has pointed out can only happen once.

The Pulse Survey also shows that business confidence is still 10 points lower than it was a year ago under the Newman government.

Under the first few months of the Palaszczuk Labor Government, the Pulse Survey showed business confidence for the March Quarter had sunk to a record low,” Shadow Treasurer John-Paul Langbroek said.

“That’s why it’s heartening to see the results from the June Quarter move in the right direction, however Queensland is still not out of the woods.

“The outlook is still in negative territory and 10-points lower than in June last year under the LNP Government. Business conditions are also far weaker than they were 12 months ago.”

Regionally, business confidence improved everywhere except the central coast, which, at 33.7 per cent, remains the lowest in the state, with the slowdown in the resource sector chiefly to blame.

Brisbane businesses are more confident, with 42.6 per cent expecting to see improvement in the next year, but central Queensland leads the way in optimism, with almost half, 49 per cent of business respondents, positive about the year ahead.

The Gold Coast, which largely remains LNP heartland, was less optimistic, with just 38.4 per cent of businesses expecting to see an improvement, five points behind the Sunshine Coast.  Far north Queensland at 45.4 per cent and north Queensland, 44.1 per cent, have also responded positively, as did the south west, with 43.4 per cent predicting things could only get better.

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