Opinion: Sorry Jim, this is how you do a REAL productivity summit

The government’s productivity roundtable was not that productive, so I organised a real summit, writes Matt Canavan. WATCH NOW

I will give the government its due. It has at least belatedly recognised our woeful productivity performance and held a roundtable on the topic in Canberra.

That is the good news. The bad news is that their three-day productivity roundtable has not been that productive.

Given we have had the worst productivity performance of any developed nation in recent years – and the biggest drop in living standards – you would expect a sane government to conclude that we need to start doing things differently.

But instead, the government’s productivity roundtable has been an exercise in doubling down on failure.

YOU CAN WATCH THE ‘REAL ROUNDTABLE’ IN THE VIDEO PLAYER ABOVE

Australia has been installing solar and wind at a rate of four times that in North America and Europe. We have ended up with some of the highest power prices in the world. An outcome that the Australian Workers’ Union has recognised is threatening Australian jobs.

So, the government’s plan is to do more of the same by exempting solar and wind projects from financial performance standards and environmental laws. So, in the end, “green” energy would be exempt from our green laws.

The Australian Government is now spending $300bn a year more than it did before Covid-19. That amounts to an extra $30,000 per year per Australian household. Do you think we are getting $30,000 a year more in the value of our hospitals, our schools and our roads?

Yet the main ideas to come out of the roundtable have been for more taxes on cars, factories and business profits. Instead of tightening their own belt, your government wants to force you to tighten yours more.

Our economic policies have been like the salesman who is losing $5 on every item sold. So, his answer is to make up the losses through more volume sold.

To make things better we need to change the failed economic model that has emerged from Canberra in the past two decades. Over that time the labour productivity of our electricity and gas sector has crashed by 20 per cent forcing energy prices through the roof. We need an economic policy revolution not a continuation of failure.

Federal Treasurer Jim Chalmers last week. Picture: Martin Ollman/NCA NewsWire

So, I organised a REAL productivity summit to focus on the real challenges that are holding our country back. Unlike the government’s fake summit, mine tackled the elephants in the room like energy prices, industrial relations and rampant government spending and regulations.

YOU CAN WATCH THE ‘REAL ROUNDTABLE’ IN THE VIDEO PLAYER ABOVE

The former head of the Productivity Commission, Gary Banks, made the point that our low energy prices used to allow us to pay higher wages and provide better working conditions under our industrial relations system. Now that we have lost our energy competitiveness, real wages are declining.

The Housing Industry Association noted that there are now 70,000 pages of rules that govern how a home is built adding ridiculous amounts to the cost of building a home. We agreed that we need to re-establish an independent body to review all government regulations and that every year Parliament should devote one day to repealing out-of-date and costly laws.

David Pearl, a former assistant secretary of the Treasury, proposed that we outlaw bracket creep that just allows the government to tax you more when there is inflation. He proposed that we reduce government spending by four percentage points of GDP over time and return the savings in tax cuts. If we did this that would see that $300bn increase in government spending that I mentioned above, limited to a more reasonable $200bn increase.

As David said when we ration our carbon emissions, we ration our economic growth. The pursuit of net zero emissions is putting a massive handbrake on our economic potential and for no environmental gain. As Centre of Independent Studies energy analyst Aidan Morrison showed, coal-fired power is half the cost of a solar and wind-based system.

We should scrap net zero along with our legislative ban on nuclear energy and our de facto ban on coal fired power stations. Coal remains Australia’s cheapest form of reliable electricity. We will not blow the planet up if we build a few modern coal fired power stations especially when China is building two a week.

In short, my productivity summit proposed the radical idea of cutting government taxes and regulations, not increasing them. We got more done in half a day than the government’s unproductive talkfest over three days. That should not be surprising because the main takeaway of our discussions was that to make the Australian economy bigger, we need government to be smaller.

Matt Canavan is an LNP senator for Queensland