Australia’s Business Council of Co-operatives and Mutuals (BCCM) says it wants to see significant economic reform from the government’s economic roundtable in Canberra, which has gathered business, unions and decision makers at Parliament House.
“Regulation impacts co-operatives and mutuals as much as any business sector,” said BCCM chief executive Melina Morrison. “It is frequently applied disproportionately, with duplication in the system meaning state and federal regulations apply at the same time and usually in an uncoordinated way.
“But the real issue in stagnant growth and lack of productivity lies in lack of competition. There’s scant commentary about market concentration in many markets and the lack of consumer choice and price inflation this leads to.”
She added: “It’s impossible to get dynamism in a market where you have just one or two dominant players. Australia’s corporate diversity has declined over several decades, often driven by demutualisation of co-ops and mutuals but also by takeovers and business closure of SMEs.”
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Morrison said banking and retail are two of the markets where lack of competition has led to very high market concentration.
“Sky high profits are made in these sectors and new market entrants can’t emerge to put downward pressure on prices,” she added. “The inquiries into banking and supermarkets should leave no doubt that Australia needs more competition in these sectors.”
In its submission, the BCCM gave examples of the way that co-ops and mutuals shape markets to increase competition and consumer choice. It is making three submissions to the roundtable, including better regulation of co-operatives – modernising the Co-operatives National Law and harmonising it nationally to enable growth and scaling.
It also wants to see asset lock protection – voluntary legislation ensuring mutual assets are permanently protected to support long-term investment.
Finally, it calls for a Treasury-led working group – creating a national forum to coordinate policy and regulation for co-ops and mutuals.
