Nine new ways to make us richer, safer and happier

From quality coffee in every office to sending one million people to the bush, thousands of ideas have emerged for Anthony Albanese’s three-day debate on ways to lift Australians’ living standards.

Twenty-five people will discuss the various merits of the proposals with the government hoping some sort of consensus around a few will emerge.

Making airport security faster, imposing a carbon tax, and unifying communication on the country’s trains would all boost productivity.Credit: Matt Willis

While tax and technology will be central elements, finding a way to turn around a two-decade long slowdown in productivity growth will require changes across the entire economy.

Here are nine that would certainly contribute to a more productive Australia.

Establish a prize for audacious national goals

Australian businesses and governments are laggards when it comes to research and development.

The Australian Academy of Science says business investment in R&D is 0.89 per cent of GDP. The OECD average is 1.99 per cent. In dollars terms, Australian businesses are spending $32.5 billion a year less than other rich nations.

The roundtable will likely endorse tax reforms to lift R&D, but the government should go further – offer big cash rewards to anyone who comes up with ground-breaking ideas.

Prizes have been used for more than a century (Charles Lindberg won the $US25,000 Orteig Prize for flying non-stop from New York to Paris in 1927) and were recently used to encourage private businesses to send people into space.

Set a target – be it a new breed of drought resistant wheat, a cure to a debilitating disease, a new form of transport – and offer a huge prize.

Pay the states to reform clogged bureaucracy

Just as a financial prize should encourage innovation in the private sector, offering the states and territories money should unclog some of their bureaucratic processes.

National competition policy, effectively payments to the states to open up their economies, started under Paul Keating and ran for a decade. It transformed the economy and is credited as one of the key factors behind the productivity surge of the 1990s and early 2000s.

The current government has created a $900 million national productivity fund for the next 10 years. But to really get the states moving in areas such as housing approval reforms the cash on offer to the states has to be increased to a level that only an idiot would ignore.

A carbon price is still good policy

Some might argue this ship has sailed, but we need to bring back a carbon price.

But given how much this country is spending to reduce its carbon emissions (this year’s federal budget contained $4.3 billion in new expenditure on net zero), the idea of protecting our environment in the most efficient and non-discriminatory way has not altered.

And that system remains a carbon price.

Fix terrible taxes

While tax will take up a lot of the roundtable’s time, it could deliver a huge win to all Australians by axing one.

Stamp duties on insurance are possibly the nation’s worst taxes.

Insurance is something that should be encouraged, not taxed. Yet, every state and territory bar the ACT imposes stamp duties on insurance.

In NSW, an emergency services levy sits on top of the insurance stamp duty, delivering residents a tax double whammy.

Insurance costs have soared after a string of natural disasters such as the floods that hit Lismore in 2022. But they would be lower if not for state stamp duties.Credit: Elise Derwin

It’s one reason why 13 per cent of NSW households are uninsured, double the rate of Victoria where taxes on insurance are a third of their northern neighbour.

Removing taxes on a public good like insurance would only add to the economy’s productivity level.

Don’t give unions a veto on AI

Lifting productivity depends largely on new technology, enabling more efficient use of our resources. But if you limit those technologies, you limit the benefits.

The union movement is already demanding that workers have a say in the use of AI with an effective veto if it is deemed to “not be in the public interest”.

You can imagine the English textile workers of the early 19th century arguing that automated machines to spin yarn was not in the public interest, when in fact they were talking about their personal financial interest.

If the Luddites had secured their own veto over those machines, the history of the industrial revolution would have been very different, with many, many more poor people trapped in menial and dangerous work.

While AI and the use of big data by businesses and researchers scares many, that can’t be an excuse to over-regulate what could be the next productivity step up for the economy.

Audit airports to speed up travel

Anyone trapped in the hell that passes for security at the nation’s airports knows what a drag it is.

Jacket on or jacket off, walk through a metal detector or stand still, laptop out of its case or tucked away in your bag with that dangerous container of deodorant.

An entire industry has grown to service this single point in our airports.

Since the September 11 attacks in 2001, the amount of security law passed is beyond comprehension - all at a huge economic and productivity cost.

An audit of our security systems, be they private or public, is needed to see how we can do things better.

Fix Australia’s broken employment system for job seekers

Two years ago, Labor MP Julian Hill handed down a report into the nation’s employment services system, warning that it would be “absolutely nuts” for any country to adopt Australia’s privatised approach to getting people back into work.

He was correct then and, with no meaningful reform to the nation’s employment service system since his report, it remains correct.

Presently, with unemployment at 4.3 per cent, there’s around 65,000 people who have been out of work at least two years. There are hundreds of thousands more who have been unemployed for less time than that, or who have dropped out of the job market entirely.

The median length of time searching for a job for this group is an astonishing 179 weeks. Twenty years ago, it was around 180 weeks.

The country spends more than $7 billion a year on the employment services system with the stated aim of getting people into work. Making the system work would deliver a benefit to hundreds of thousands of people – and the economy.

Share healthcare data to stop doing so many low-value procedures

In 2017, the Productivity Commission identified the health system as ripe for improvement.

The health sector – including aged care – is the country’s largest employer and a huge call on our finances, both private and public.

Making the health system work better could turn around the nation’s overall productivity performance.

Some of the commission’s 2017 proposals should be re-visited. This includes the creation of small funding pools for primary health or local hospital networks aimed specifically at dealing with chronic conditions and reducing hospitalisation.

Our doctors and other health practitioners carry out too many low-value procedures – from knee arthroscopies to hysterectomies. Better information for clinicians would be one way to reduce this expense while improving patients’ outcomes.

That leads to its most important proposal – make the patient the centre of care. This includes more data to medical colleges, hospitals and patients about what is working and what isn’t.

Unify maddening train communications

Some productivity problems have plagued this nation for more than a century. It took until 1962 to join NSW and Victoria with the same rail gauges.

But more than 60 years later, the nation’s rail systems are still beset by productivity-sapping differences.

It took 70 years to join NSW and Victoria with a single rail gauge at Albury. Sixty years on, the rail system is still plagued with problems.Credit: Archives

Trains moving across the inter-linked rail network carry up to six different radios because state communication systems differ.

If you carry out some work on a rail line in NSW you wear a hi-viz vest with a cross on its back. But work in Victoria, the vest must show parallel lines.

Signal lights mean different things depending on which state you’re riding the rails. A green/red signal in NSW means caution, in Victoria it means all clear ahead, while in Queensland the signal doesn’t exist.

The federal government, to its credit, has started work on unifying the radio communications system. But it could take years to resolve.

Billions of dollars could be saved, for businesses, customers and state governments if the nation’s rail line system was dragged out of the 20th century.

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