It could be said without much exaggeration that whatever the economic problem, productivity is the answer.

As Treasury’s Intergenerational Report makes clear, greater productivity would generate higher national income and lead to a smaller relative debt burden. It is the key to a more sustainable fiscal outlook in circumstances where governments seem powerless to rein in excessive spending (or feel pressured to spend even more). And, of special importance right now, it is the key to non-inflationary wage growth that could see real wages and living standards rise again.