Shadow Treasurer Ted O'Brien and industry chief Andrew McKellar’s tax and red tape wishlists

Business, union, community representatives and experts have gathered in Canberra to grapple with some of Australia’s most intractable problems: how to make us a more productive, sustainable and resilient country.

A vast amount of work has been done before the roundtable, with most groups coming in with ideas on what should be done – some, of course driven by self-interest.

Treasurer Jim Chalmers has also invited his opposition counterpart, Shadow Treasurer Ted O'Brien.

On this podcast we are joined by O'Brien, followed by one of the business representatives, Australian Chamber of Commerce and Industry chief executive Andrew McKellar.

This follows our interviews with Australian Council of Trade Union secretary Sally McManus and Chalmers last week.

Asked about which of the Productivity Commission’s pre-roundtable ideas he supports, O'Brien says he:

loved the Productivity Commission’s message about having a growth mindset. I think that is spot on and it is exactly what Australia needs. We need to be ambitious for our country and that requires a growth mindset. I also think they have defined what productivity is very well, which is, it’s all about living standards.

[…] I think their AI report has triggered some healthy debate, I think that’s been very helpful. I don’t like a lot of their tax comments, again because we have some markers when we look at this roundtable. One of those markers is that you don’t raise living standards by raising taxes.

On what he and Chalmers might agree on during this summit, the answer is not much.

[…] I think we can agree on his initial definition of the problem to solve – and that’s a good start – which is the government’s budget is not sustainable. I agree with Jim Chalmers on that, 100%. It is not a sustainable, his own budget.

The second thing I think we can agree on is the importance of productivity. And the numbers do the talking, the biggest drop in living standards that we’ve seen. And the biggest drop in the developed world. So I am with Jim Chalmers on that.

When asked if they at least agreed on the same destination, if not the same roads, O'Brien stresses the difference he sees between himself and the government:

I would say very much different roads [… and] I would say completely different destinations. I believe that if we continue under the path of the Labor government, Australia will be a poor, weak and dependent nation. Under a Coalition, I believe Australia’s future is one where we will be prosperous, not poor. We’ll be strong, not weak. And we’ll be fiercely independent, not dependent on others.

Meanwhile, the Australian Chamber of Commerce and Industry’s CEO Andrew McKellar says he’s optimistic going into the roundtable and highlights where we might see consensus emerge this week.

I think there are some areas of common ground emerging. People are pointing to housing. So there’s been a lot of talk about how we address the challenges of housing affordability fundamentally. That can only be done if we get supply moving in the housing and construction sector regulation. The National Construction Code is a big part of what’s holding that back.

[… There are] currently, 2,000 pages of regulation. You attach to that, about 165 different Australian standards. It stacks up to a huge pile of paper and regulation that’s got to be complied with […] You add on top of that all the processes at a state level, in terms of land release and planning approvals, environmental approvals, then the building approvals process – it can take many years to [… get] to the point where you can get keys in doors.

McKellar says looking beyond this week’s talks, he hopes the government will have the courage to take on comprehensive, long-term tax reform. But he says the challenge for the government is:

to determine how it’s going to spend some of that enormous political capital that it’s accrued, if it’s going to make fundamental changes which do benefit the Australian economy. And I mean, obviously, selling that is a difficult proposition. Convincing the electorate that it is in their best interests to contemplate how we have a fit-for-purpose tax system for the future.

[…] They have a very significant majority now, but I think they can make the case. If they want to be ambitious, we urge the government to be in this regard […] There’s always, I think a challenge to get consensus around reform. But as we look down the track, then they really have the opportunity to create a legacy.