Roundtable to grapple with political footballs and regulatory hairballs

Treasurer Jim Chalmers on Tuesday will give the diverse collection of participants at the economic roundtable their riding instructions, as he seeks to wring as much substance as possible out of the meeting.

The success or otherwise of the three-day summit will reflect on Chalmers, who will not only lead it but has driven the huge amount of ministerial and bureaucratic effort in its run up.

In his opening remarks for Day 1, released ahead of delivery, Chalmers says the government is looking to build consensus around three types of outcomes. These are:

• clear reform directions – areas where there’s momentum and broad agreement on the direction of travel even if unanimity isn’t there yet

• specific reforms – the handful of changes we could all agree on now

• ongoing priorities – where there’s appetite in the room for further work.

Chalmers says this is a three-day opportunity to inform three budgets and beyond. He re-emphasises the need for “concrete ideas” and ways “to be able to pay for them”.

Prime Minister Anthony Albanese, who will open the roundtable, continued to play down expectations on Monday.

Asked whether, given his majority and good polling, he had to “seize the opportunity for proper reform now”, he said, “Well, we are engaged in reform across the board”.

But this was an inclusive government and open to ideas, he said. “We have a clear policy agenda, but we’ve also said that’s not the limit of our ambition. So, we’re not saying people aren’t allowed to raise things, we’re saying raise whatever you like. We’ll have that debate not just in the room, but importantly out there as well,” he said.

“We are open to engagement and that is how you bring people with you as well on that journey of reform. You don’t just spring things. And that is something that my government is determined to do.”

Albanese again rejected suggestions he had been trying to rein in Chalmers.

Meanwhile Danielle Wood, chair of the Productivity Commission, was urging ambition.

“Ultimately the government will be judged on its actions and the outcomes they achieve,” she told the National Press Club.

“But it has taken an important step by recognising and pursuing economic growth, and the productivity that drives it, as a prime goal of policy.

"This ‘growth mindset’ – an elevation of growth and the benefits it brings – has been missing from Australian policy for far too long.”

Wood outlined what “a growth mindset looks like”.

1. Regulate with growth in mind

“Leadership from the top” was needed “when the policy sausage is being made”.

“Ministers should always weigh up the impacts of new policies on economic growth and productivity,” she said. The commission recommended government put out a clear statement of intent to this effect, backed with upfront regulatory reform.

“Government must bake in the process of asking themselves, ‘What have you done for growth today?’”. (This is a reference to a sign used at the time by the United States Commerce Department that reflected President John Kennedy’s focus on economic renewal.)

2. Real growth comes from new ideas and technology

“A growth mindset means fostering ways for Australia to benefit from a combination of our own innovations and using – or building on – the inventiveness of others,” Wood said.

“That’s why the PC favours policy and regulatory approaches that focus on outcomes – for example relying more on consumer outcomes in privacy regulations and avoiding technology-specific laws on AI.”

3. Productivity is a game of (many) inches

“There is simply no single policy reform that can bring productivity growth back to its long term average of 1.6%,” Wood said.

“To shift the dial, governments will have to make a lot of pro-productivity decisions.”

Unlike cynics about the roundtable, for Wood the whole exercise is like “Christmas, the grand finale of MasterChef and the Productivity Commission’s 2024 table tennis victory over treasury, all combined,

"I’m thrilled by the new appetite for economic reform that the roundtable has created over the past two months.

"And by the treasurer’s elevation of productivity as ‘the primary focus’ of the government.”

Wood has surely already won the prize for the best metaphor for Australia’s regulatory mess. “Regulatory hairballs have found their way into almost every corner of the economy”, she said.