Back in February, The first three Federal election issues - the economy, industrial relations and NSW Labor, nominated the first three key issues that I thought were going to be important in electoral terms.
In recent weeks, the question of budget deficits has come to the fore. While the mantra of immediate returns to surplus has dropped away, that's clearly not on, the need to address the structural deficit has become central to discussion. Phrases like "the need to share the pain" have become ritual. I think that a fair bit of the discussion misses the point.
I am not a supporter of productivity improvement for the sake of productivity improvement. Too often, it becomes another squeeze for short term gain. I am a supporter of productivity improvement as a means to longer term growth.
Our problem at the moment is that budget and associated policy discussions have become a zero sum game. If one benefits, another must lose. That leads to fights, fights that will get worse if Government budgets are all, as argued, in structural deficit. Of course, there will always be trade-offs, trade-offs made worse by current obsessions with "the big picture", the "big reform". There have been too many promises, too little focus on simplification and steady improvement. too many expectations. But we need to change focus. If the rules of the game are fixed, change the game!
So what do you think might improve long term productivity, increase growth, help us meet challenges like an aging population? I have my own ideas. I would be interested in yours.
I suspect that I left this too general to attract responses. So focusing all this a little.
Here is a speech by the Chair of the Australian Productivity Commission setting out what the Commission perceives to be the to to do list required to increase productivity. I agree with some, but find there to be a fairly mechanical flavour. Now these views have been widely reflected in media and business commentary, so that they are not without influence.
To further focus discussion, I pose three questions:
- If Gonski is introduced exactly as proposed, will it increase productivity? That's a claim that's often made. How?
- Why has Australia been so slow to invest in new infrastructure when there appears to have been general agreement for at least a decade that this is necessary?
- COAG, the Council of Australian Governments appears somewhat broken, adding to rigidities and reporting load without achieving reform. Is this true? Does it matter? Obviously I think that it does.
Those are just three initial questions. I am sure that you have your own.