Parliament Must Focus on Reform Where There Is Broad Agreement

16 September 2010

The Australian

Graham Bradley

President, Business Council of Australia

Edited extract of a speech by Business Council of Australia President Graham Bradley to the National Press Club in Canberra. Download the full speech here.

Like many Australians, we at the Business Council of Australia felt short-changed by the election campaign, both by the policies put forward and the quality of debate.

Rather than dwelling on the challenges of a minority government, our view is that we should get on with the job at hand. A good place to start is to refocus on goals where there is already broad agreement.

Parliamentary reform is one example, improving the life opportunities for indigenous Australians is another. There is also a good deal of common ground on the need for tax reform and better infrastructure.

Let’s not put off progress on national interest objectives on which we agree just because there are others on which we do not. This is the kind of leadership I think Australians are looking for from our political and business leaders.

There are risks associated with Australia’s present economic strength; complacency is at the top of the list. With strong terms of trade, falling unemployment and rising workforce participation, it’s tempting for governments to ride on the short term rather than doing the hard work of explaining what reforms we need for the longer term.

People sometimes baulk at the term reform because they associate it with change or uncertainty. What I mean by reform is what governments have to do to be good managers.

Neither the good fortune of our geography nor our natural resources would have delivered our present prosperity if Australians hadn’t found the common ground that emboldened successive governments for 25 years to put the right policies in place.

We made our luck and we need to keep doing so.

I believe Australians are ready to be convinced of the merits of a broad reform agenda as long as it is shaped and pursued through community education, consultation and genuine effort by all parties to find and build common ground in the interests of the nation.

The BCA has recommended a suite of actions to the new government for its first 100 days, chosen because they would send a strong signal to the community, including business, that this government will do what’s necessary to be a good manager.

They address issues on which there is considerable common ground, if not on actual policy detail then certainly on the need for action.

Australia needs a national infrastructure plan that addresses economic and quality of life infrastructure requirements across the country.
The plan should set out reforms needed to improve regulatory and pricing policies to encourage better use of existing infrastructure, and to provide opportunities for private-sector investment.

It must also identify priority projects that will drive national productivity. A comprehensive and transparent cost-benefit analysis of these projects should be undertaken as well as a clear assessment of how projects should be funded.

Where big projects involve federal government investment, as is the case with the proposed National Broadband Network, a comprehensive cost-benefit analysis and justification for public investment should be released. Infrastructure Australia, with an increased level of independence and sufficient resourcing, is well-placed to provide all this advice.

The government should provide details of how it will proceed with taxation reform in this term. The agreement to convene a tax summit presents a positive opportunity to engage with the community. But its value will depend on the extent to which the potential of the summit is embraced across the political divide and across the community, with a full exchange of views and options, including on the GST.

We look forward to more details and to taking part in the summit. In the meantime, the BCA calls on the government to release all modelling and revenue estimates associated with the Henry review to show good faith and to ensure the best quality debate.

On the issue of the mining tax and how it may fit within the tax summit, there is a process under way, with the Argus group developing advice in consultation with the directly affected companies and stakeholders.

We support this process provided consultations are open and all stakeholders are given the opportunity to participate. We would expect the findings from the Argus group to inform the tax summit.

A commitment to develop a national energy security policy should be announced.

It’s time we faced the prospect that Australia may not continue to benefit from our low-cost energy sources – coal and gas – and asked ourselves what policies are needed to ensure our economy and standards of living don’t suffer as a consequence.

We have had little integrated consideration of Australia’s long-term energy needs, the nature of Australia’s future economic structure, the various technological developments and options available, and how all of this would be affected by alternative emissions reduction options. Real political leadership would encourage the community to consider nuclear power as part of this process.

Taking a long-term view on energy security is critical to future living standards, employment and the economy. It is also a sensible, common ground starting point in addressing our response to climate-change risk.

The federal government should convene a meeting of the Council of Australian Governments to reset the council’s agenda, with a sharper focus on a smaller number of reform areas with the greatest potential to drive productivity growth in the near term.

At a time of falling unemployment and rising capacity constraints, policy-makers need to bring forward structural reforms that will expand Australia’s productive capacity. These reforms depend increasingly on the states and territories.

Our final suggestion is the establishment of a permanent, independent commission of budget integrity to assess federal spending programs.

The proposal to establish a parliamentary budget office is a useful first step, but there is a case to go further. This would allow for government activities and public-sector performance to be assessed in a context. It would allow us to consider whether programs are meeting their objectives and whether ongoing government involvement in particular areas is even appropriate.

These five priorities would provide a positive, early signal of what is possible from this new model of government.

Our democracy is a great strength, but only if our national leaders use it to lead, to pursue what’s important to our nation’s prosperity and to take citizens with them on that journey. This is the lesson from the recent extraordinary election.

Our leaders need to find and build common ground with each other and with the community and its various interconnected sectors, including business.

We haven’t experienced the crisis that has spurred the bold reform agenda we are seeing in Britain. But a smart country doesn’t wait for a crisis to act resolutely. Nor should we make excuses about the difficulties posed by a different style of parliament.



Latest news

2010 Opinion Articles

2010 Opinion Articles

2010 Opinion Articles