PM’s roundtable must puncture Canberra bubble

Prime Minister Anthony Albanese and Treasurer Jim Chalmers.

It’s hard not to be cynical about the August productivity roundtable Anthony Albanese announced on Monday. After all, the government’s much-hyped 2022 Jobs and Skills Summit was a stitch-up for the ages.

At that event, naive peak business representatives were tricked into rubberstamping union-dictated initiatives – agreed with the government in advance – to re-regulate workplace relations. But let’s try to be open-minded about the upcoming get-together.

Perhaps, just perhaps, there may be a scintilla of sincerity behind the whole idea.

A grudging recognition from the Prime Minister and Treasurer that they have no credible productivity and growth agenda to speak of. At least you would hope so, although we should never underestimate the capacity for those in the Canberra bubble – politicians, bureaucrats and much of the media – to delude themselves.

When considering summits, two historical examples come to mind. At the inane end of the spectrum, there is Kevin Rudd’s 2020 summit held in April 2008, where Australia’s self-styled good and great waxed lyrical about every fashionable and derivative idea under the sun.

Productivity was one of 10 special themes, no less. It was much ado about very little; more a bad Fellini movie than serious policy exercise. And at the other end, there is the 1985 tax summit, chaired by then prime minister Bob Hawke.

At this event, his green-behind-the-gills treasurer, Paul Keating, argued for a tax-mix shift away from income to consumption, doing his best to win union agreement for his broadbased consumption tax. While Keating failed – with Hawke getting cold feet on the idea despite cabinet supporting it – this defeat was the making of him, establishing his reform credentials. Of course, Albanese’s productivity roundtable will not come close to emulating the tax summit, but to avoid being seen as an abject failure it will have to meet three critical tests.

First, it must challenge the anti-productivity, anti-growth shibboleths of progressive economics that dominate Canberra, and sadly even Treasury.

Not only its quasi-religious belief in unilateral net zero – a self-imposed, escalating and whole-of economy energy tariff – but its advocacy of higher taxes and un-means-tested welfare, the re-regulation of key markets and permanent fiscal deficits. Net zero will not be challenged – to do so would be to question Greta Thunberg’s status as energy policy prophet – but the government’s addiction to bracket creep and punishingly high personal income tax rates for middle-class Australians should be.

And be wary of calls for faster regulatory decisions. The goal must be to remove anti-development red and green tape, taking our power-hungry regulators out of the equation all together.

Second, roundtable’s participants – the business representatives, unionists and leaders of civil society who attend – must be prepared to put the national interest before their sectional ones.

While many small and medium-sized businesses have no illusions about the harm the government’s energy and workplace relations policies are doing, too many of our larger businesses have remained silent about it – whether out of fear (given the hard-left views of their industry super shareholders) or from greed (knowing that they can cut special deals with the government or unions).

Similarly, our current generation of union leaders appear wedded to an extraordinary narrow and shortsighted view of the world – seeking to build their power and membership reach at all costs, even if it hobbles our employers and, as a result, weakens future wages and employment growth.

Our civil society representatives must also show leadership.

They must be prepared to speak up about the deeply regressive effect of rising energy costs caused by our shift to intermittent energy, putting the interests of the poor before those of affluent virtue-signallers.

A third test the roundtable must meet is a political one.

Let’s put it bluntly. We will know that it was worthwhile if its recommendations and arguments get up the nose of the Labor Left, which currently dominates the party. This was the test Bob Hawke and Paul Keating were happy to apply in their day, whether on privatisation, abolishing “free” tertiary education, reducing tariffs and cutting the top personal income tax rate. As they may well have said to each other at the time; if the young Albanese opposed the policy in question, it must have been the right one to adopt.

Asking Jim Chalmers to chair the roundtable does not augur well for it. Our Treasurer, like Wayne Swan before him, distrusts the very notion of lifting productivity, believing that it is a ruse to get workers to toil harder for longer.

Its prospects might ultimately rest with the Prime Minister. Almost every syllable of his press club speech was a pitch for more government spending, planning and control over our lives. As he chillingly put it, the government must “aim high” and “build big”.

Having raised expectations so high, the question has to be put.

Will the roundtable be a Nixon-to-China moment for the Prime Minister – marking his move from the hard left to the centre – or will he be left looking and sounding like Chauncey Gardiner?

David Pearl is a former Treasury Assistant secretary.