00:01Well, what we're doing is taking the productivity growth that we've seen over the last six
00:06years of the 2020s, and we know that when we look at that data, what that shows is that
00:12on average, we've declined year-on-year by a negative 0.1 of a percent.
00:18Now that's compared with what was previously, or presently, the worst decade on record for
00:24productivity growth, which is the 2010s, which is positive growth of 1.2 per cent per year.
00:32So what that highlights is that there is already a significant gap between the 2010s, which
00:39presently is the worst decade on record, and our existing decade, the 2020s.
00:44And that is deeply concerning because when productivity is low, it reduces our capacity to increase
00:51living standards and give all Australians the opportunity to get ahead.
00:55It's successive governments failing to adequately take the type of steps that are required to
01:01deliver productivity reform.
01:04What that means is that we don't have the type of competitive settings in Australia that
01:10we do see in other countries overseas that help drive business investment.
01:14Business investment, of course, being the primary basis for productivity growth.
01:18But it is very clear that we need the current government to do much more in terms of driving
01:25productivity reform.
01:26And that includes steps like reducing regulation.
01:29We've consistently called for a target of a 25 per cent cut in the value of regulation
01:35on our economy.
01:37Comprehensive tax reform that tackles our uncompetitive tax rates in terms of company tax, but also income
01:43taxes and consumption taxes and, of course, our uncompetitive industrial relations system,
01:50which is now fundamentally out of balance.
01:51There is no question that improving our access to skill sets is going to increase our prospects
01:58of turning around our productivity malaise.
02:01There's also no question that AI holds enormous potential to lift our productivity.
02:07But I would caution against Australia putting all of its productivity eggs in the AI basket.
02:14We see that there are many countries around the world, including our core competitors like
02:19the US, the UK, New Zealand and Canada, that are also taking steps to try and improve their
02:26productivity through the application of AI.
02:28But in addition to that, they are going out of their way to try and make their underlying
02:33settings, so their taxation settings, their regulatory settings, their industrial relations
02:38settings, as competitive as possible.
02:41We need to be doing likewise if we're going to keep up with them.
02:44You have to remember here, and this is the really important point, you have to remember
02:48that as things stand right now, the Australian Treasury forecast that come 2060, we can expect
02:54a gap between revenue and expenditure of $140 billion a year.
02:59Now, to address that, and that I should say, that gap comes about largely because we've got
03:05an ageing population, so a declining working population.
03:09But to address that, the best thing that we can do is grow our economy.
03:13And yet, as things stand right now, one in three occupations reports a skills shortage.
03:18So, we can't grow our economy and reduce that gap between government, revenue and expenditure,
03:25unless we're prepared to train our people internally, but also to recognise that historically and into
03:32the future, Australia is going to need skilled migrants.
03:36We need them for the projects that drive our economic growth.
03:39So the starting point for any conversation with respect to migration can't be simply having
03:45the objective of cutting numbers, it has to be how do we go about delivering the growth
03:50that ultimately locks in and secures our way of life.
Comments