Editor’s view: Albanese gov will be judged on outcomes not talkfests and ideas

Treasurer Jim Chalmers has declared improving Australia’s poor productivity performance his biggest second-term priority, but the detail is sketchy, writes the editor.

Dr Jim Chalmers MP, Treasurer of Australia addresses the National Press Club of Australia in Canberra on "Our Second Term Economic Agenda". Picture: Martin Ollman

Treasurer Jim Chalmers has declared improving Australia’s poor productivity performance his biggest second-term priority.

It’s a serious problem that needs urgent fixing. Australia’s recent productivity growth has been the slowest in decades – the Albanese government’s first electoral victory, in May 2022 coincided with the largest quarterly fall in productivity growth in almost half a century.

And we’ve been falling behind the rest of the world, dropping 10 places in the OECD’s productivity rankings in the 50 years to 2020.

Productivity, Mr Chalmers explained at the National Press Club yesterday, was the key to a better future. “Too often, it’s seen as a cold, almost soulless, concept – when it’s really the best way of making people better off over time, creating more opportunities, making our economy and our society more dynamic,” he said.

So, what’s the Albanese government doing about it? A lot, according to Mr Chalmers, who said Cabinet had agreed on a “five-pillar productivity agenda” – an aspirational wishlist which ranges from “creating a more dynamic and resilient economy” to “building a skilled and adaptable workforce” and “delivering quality care more efficiently”.

He claimed the government has already made “substantial progress” with such actions as “overhauling our merger and foreign investment regimes”, “cutting around 500 nuisance tariffs” and “helping business digitise with a bigger, better NBN.”

Treasurer Jim Chalmers. Picture: Martin Ollman

All good stuff, but not exactly dial-shifting. But Mr Chalmers promises more is on the way, most immediately an exclusive “reform roundtable” in August to include the heads of the Reserve Bank, the Productivity Commission and “union and civil society representatives and experts”.

There’s nothing wrong with bringing experts and interested parties together to help develop government strategies. But again, the proposed rules of engagement read more like a wishlist than anything yet resembling a clear strategy for the future.

Mr Chalmers said anyone submitting ideas through the roundtable or through a dedicated Treasury contact point would need to meet three preconditions, which sounds wonderful in theory but difficult to imagine in practice.

He would like ideas that are “put forward in the national interest, not through the prism of sectoral, state or vested interests”. It might be the paid sceptic in us, but it’s hard to imagine any peak body in the country paying much attention to that request.

Mr Chalmers also wants to see that “ideas or packages of ideas should be budget neutral at a minimum but preferably budget positive overall, taking into account the necessary trade-offs.”

Again, a wonderful idea but it’s hard to think of a single government action on any front that doesn’t result in either lost revenue – say a tax break to help an industry – or cost taxpayers more – say free education for apprentices.

And third, Dr Chalmers wants ideas that are “specific and practical, not abstract or unrealistic”. Once again, hard to disagree with but let’s hope the bureaucrats have the skill to spot the difference. By the time of the next election the Albanese government will be judged on outcomes – rather than how many people they spoke to and how many ideas they collected along the way.

Originally published as Editor’s view: Albanese gov will be judged on outcomes not talkfests and ideas