Billions of dollars in government support and record low interest rates are failing to encourage businesses to sink money into vital capital projects and new equipment as signs indicate the climb out of the coronavirus recession will be slow.
Spending on plant and equipment has fallen to its lowest level since March 2007 despite large government incentives and record low interest rates.Spending on buildings and structures slipped by 3.7 per cent while there was a 2.2 per cent drop in expenditure on equipment and plant. Expenditure is down by 13.8 per cent over the past year and by 44 per cent since its peak in 2012.
Business are planning to spend a total of $105 billion on buildings, plant and equipment. If this is realised, it would be a 10.1 per cent fall on the $116.8 billion spent in 2019-20.
If they are just able to resume normal trading they won't need any of that