The Population Imperative

This interview, first broadcast on Radio National Breakfast and published by ABC Online, 8 April 2010, is reproduced by permission of the Australian Broadcasting Corporation and ABC Online. © 2010 ABC. All rights reserved.

8 April 2010

BCA President Graham Bradley was interviewed by Fran Kelly on the ABC Radio National ‘Breakfast’ program on 8 April 2010.

In the interview, he discussed:

• The need for a growing population to help fill skills needs and develop the economy 
• Demographic challenges, including the ageing of the population
• The economic and social benefits of growth
• The need for effective infrastructure planning to support the growing economy

Graham Bradley also emphasises the need for bipartisan support for a strong migration program, saying it will be ‘disappointing if migration becomes a divisive issue in the context of the coming election.’

He says that the BCA will ‘always support good and sensible policies, whichever side of politics they come from.’

Listen to the interview at the program’s website or read a transcript of the interview below.

Fran Kelly: Well the Business Council of Australia doesn’t like the Coalition pledge to cut the migrant intake. Graham Bradley is president of the BCA, which represents Australia’s largest companies. Graham, welcome back to Breakfast.

Graham Bradley: Good morning.

Fran Kelly: The Coalition says that Australia’s immigration intake is now, quote, ‘out of control’ and needs to be cut back. As we just heard, cut back quite seriously. In your view, why would that be the wrong thing to do?

Graham Bradley: Well, Australia needs a growing population to develop our economy and to, of course, offset the issues that will arise as outlined in the intergenerational report about an ageing population. So we need a vibrant immigration policy. And we have consistently supported a sustainable rate of immigration at about 180,000 net permanent migrants. And that’s really what we’ve achieved over the last 30 or 40 years and it’s what we can achieve over the next 30 or 40 years.

Fran Kelly: And the rather muddled argument we seem to be having, over the last couple of days, is about this rate and these figures. And we heard Scott Morrison say Labor’s running at 300,000 and they’ve cut it to 180,000. Do you have any understanding of what the level is at the moment? And is in your view, is it too high, about right or can’t judge from year to year?

Graham Bradley: Well I think the first thing to say is we shouldn’t be overreacting to short-term numbers. So we’ve got to look at the long-term trajectory here and what’s in our national interest. And I think that’s one of the important reasons why we support the creation of a minister of population, to get some really fact based forecasts and outline all the relevant considerations here, so people better understand the economic benefits.

But there are some very short-term things that have caused our net migration to be somewhat aberrant. One is the increase in the success of our education for foreign students in Australia, which has been an enormous benefit to the country.

And the other one is, of course, we’ve been a very vibrant and resilient economy through this global financial downturn. And as a result, we haven’t had the brain drain that we’ve had over recent years, as more Australians with skills going overseas to find jobs. More have been coming back than have been going out.

And those sort of factors are very short-term factors. They can reverse very quickly. So it’s important to look through the short-term figures at what’s the real underlying policy and sustainable net migration that we need over time. And it will vary from year to year.

Fran Kelly: And the fears, if you like, that might underlie a big Australia or an Australia that have got 36 million people in 2050, is about standards of living. And we’ve heard the Opposition say that Australians are concerned about their standards of living, caused by too much immigration.

But business says that our standard of living would drop if we don’t have enough, because we won’t have enough workers to keep the economy going. Is that your argument?

Graham Bradley: That’s absolutely the case. If you look at the intergenerational report, the important conclusion from that is not whether our population is going to be 30 million or 32 million or 35 million or 36 million in 2040. It’s about the demographics that are changing in Australia, with the number of retirees that need to be supported by the working population.

And that can’t be addressed completely by natural birth rate, which is, of course, increasing as well. So that’s why we say we need, over the long term, sustained – and I think we’d like to see a bipartisan policy on net migration, particularly focused around skilled migration.

Fran Kelly: And if you don’t get that, if we do – had a Coalition government. They cut the migration levels. In your view, what would happen?

Graham Bradley: Well, I’d be very concerned about that. And people in places like Western Australia and Queensland should be very concerned about. Because it means major resource projects that can generate enormous wealth for the country, great taxes to support health and education and social services and infrastructure, just won’t occur.

And we need not only permanent migration, but we need to continue the very sensible policies we’ve had on temporary visas, to allow us to bring in skills when we need them, without adding to the permanent population base.

Fran Kelly: Now there is another view on that. Dr John Buchanan, for instance, from Sydney University’s workplace research centre, says business wouldn’t have to resort so much to bringing in overseas workers on the temporary 457 visas if you hadn’t significantly – business hadn’t significantly scaled back on the on-the-job training programs. Could we close the skills gap ourselves if we trained up more people here?

Graham Bradley: Well, yes, over time, but that takes time. And I think we’re in – resource industries are very cyclical. They change very quickly. And I don’t think that can be all of the solution. I think employers need the flexibility to be able to bring in skilled workers when they need them.

I give you a good example would be the Western Australian mining industry, which is – where we would have had people sitting around unemployed a year ago, when there was a downturn, for example, in rural exploration. But now all the drillers in the country are at work and we need some more, in order to fully explore our resources there …

Fran Kelly: So perhaps given that, I mean that short turnaround you just talked about there, like laying 20,000 workers off during the global financial crisis and then, less than 12 months later, complaining about a skill shortage, should business be investing more in that training?
Graham Bradley: Well, look, business is doing its part in this. But we’ve also got a buoyant economy and an open economy and that means we will be subject to demands that come along more quickly than underlying training programs can cope with.

Fran Kelly: Back to the Coalition’s position on this. Have you spoken to the shadow minister, Scott Morrison, over the last day or two?

Graham Bradley: No. I’m due to catch up with him next week. I have been trying to follow his various statements on this. But we’ll be taking issue with what I understand to be his underlying concern and that is that we should be somehow cutting back on a number of areas that we think are, right at the moment, is the perfect time for Australia to be lifting the number of immigrants. We can get better quality skilled workers come into the country right now, when the rest of the world economy isn’t so buoyant. And we should take advantage of that.

Fran Kelly: Are you concerned about perhaps the politicisation of this issue?

Graham Bradley: Yes. It’s a bit surprising to me that the intergenerational report came out nearly nine months ago and didn’t spark anything like a political controversy at that time. It seems to have been sparked only in the last few months.

So I think that says that the general public has been pretty relaxed about this issue. And we have had a bipartisan approach to it. I think it would be disappointing if it becomes a divisive issue in the context of the coming election.

Fran Kelly: Will you be passing that onto Scott Morrison, when you speak to him?

Graham Bradley: Yes, indeed.

Fran Kelly: Talking about strong population growth, which the Business Council supports. Is there a point, though, because there is a population debate going on now, whether we like it or not, and we do like it because we’ve now got a population minister to try and put some structure to it.

Is there a point where growth is perhaps no longer sustainable, where it starts to harm the economy, rather than boost it? Because too much pressure on infrastructure, too much pressure on the environment, which is a lot of people’s concern, on housing?

Graham Bradley: Yes. Look I think, if you polled Australians, they’d probably be, 90 per cent would say that our governments haven’t done a good enough job on infrastructure planning around the country. And that’s something that must go hand in glove with the growing population, whether it’s by natural increase or immigration or both. And that’s something that we’ll be emphasising to both the government and the Opposition. And I think it is now widely recognised that that is one of the major priorities for the country. And unless we get infrastructure right, we can’t expect the public to support a growing economy.

Fran Kelly: And just briefly, Graham Bradley, the Opposition’s come out with this policy to a promise to cut migration. It’s seemingly without the reference to groups like yours and others, before making it. Not long ago, Tony Abbott, of course, came up with the paid maternity leave, which would put a tax on business. Are you a bit concerned about some of the policies coming out from the Coalition at the moment?

Graham Bradley: Well look, we’ll always support good and sensible policies, for whichever side of politics they come from. But we’ll also be outspoken in opposing ones that we think are bad in principle and bad for the future growth of Australia.

Fran Kelly: Okay. Graham Bradley, thank you very much for joining us on Breakfast.

Graham Bradley: Good. Thanks Fran.

[ends]

The Business Council of Australia does not guarantee the accuracy of this transcript, which was supplied by an external transcription service.