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In this episode of Debrief, Louise McGrath speaks with the Australian Industry Group’s state heads, Tim Piper in Victoria and Estha van der Linden in South Australia, to explore what businesses on the ground are really facing as both states head into pivotal 2026 election campaigns.

The conversation highlights the pressure created by land tax increases in Victoria, payroll tax design issues in South Australia, and the growing weight of WorkSafe liabilities linked to mental health claims. It also examines the challenges of high evening electricity prices, severe skills shortages and the barriers that prevent smaller firms from taking on degree apprenticeships or accessing facilities to prototype new products. In Victoria, businesses are also concerned about rising gas prices, the risk that declining residential gas use will shift network costs onto industry, and the need for long term certainty so gas reliant manufacturers are not pushed out of the state.

Clear and consistent regulation across all levels of government is essential to reduce the time businesses spend managing overlapping compliance requirements and to allow companies to redirect resources toward productivity, investment and growth.
 
Key takeaways

• Businesses want stable and predictable policy settings from state governments to reduce investment risk.
• Victorian companies are struggling with rapid land tax increases that are not aligned with their productivity or revenue.
• South Australian firms face a payroll tax bracket design that creates sharp marginal increases for small changes in payroll size.
• Mental health claims represent a small share of total claims but a large share of WorkSafe costs, which places pressure on employers.
• Victorian businesses are concerned that rising gas prices and shrinking residential gas use will shift network costs onto industry and threaten the viability of gas reliant manufacturers.
• South Australia’s renewable heavy grid creates high evening electricity prices that require better storage and firming solutions.
• Skills shortages affect businesses of all sizes, with some Victorian factories short hundreds of workers each day.
• Degree apprenticeships remain out of reach for many SMEs without adjustments to wage costs, university fees and FBT settings.
• SMEs need accessible facilities to prototype and test innovations without excessive financial risk.

Links:

• Australian Industry Group South Australian 2026 election submission

Contact the Industry Development & Policy team here.