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Economy

CEDA CEO update: 3 August 2020

CEDA CEO Melinda Cilento reflects on the challenges in Victoria and what is required to sustain and build on positive trends seen elsewhere around the country.

Monday marked the beginning of week 21 of work from home for the CEDA team. For those of us in Victoria this ‘anniversary’ has been marked by a further significant tightening of restrictions on business and social activity. Suffice to say, this is a far cry from where we would like to be or imagined we might be. These new restrictions will have a further significant impact on the Victorian and national economies, dealing the fiscal update, now only two weeks old, a serious blow. 
 
While a difficult set of circumstances, it is hard to imagine that we would have been able to retain consumer and business confidence as rising community transmission was reported. From my perspective, Victorians seem to broadly understand the need for these tougher measures.
 
Elsewhere around the country it is great to see activity recovering more strongly than might have been expected, with a nod to WA and SA in particular, and we are hoping to begin getting our team back into some of our offices outside of Victoria and NSW. 
 
As we follow the progress of recovery around the country, it is important to reflect on what is required to sustain and build on these early positive trends, especially given that significant headwinds remain. 
 
In my update last week, I mentioned that the fiscal update included the rather startling assumption that our population would grow by just 0.6 per cent next year – the lowest rate of growth since 1916. This week, let me call out that the now optimistic looking forecast in the fiscal update for 2½ per cent growth in 2021, also included a projection that non-mining investment would actually fall by nearly 20 per cent. 
 
On other fronts the Productivity Commission released a study on youth income trends that found young people’s average incomes fell in real terms in the decade to 2018 and that the COVID-19 crisis is likely exacerbating this trend as young people are among the hardest hit by job losses.
 
Both of these provide further ammunition of the need for a bold and ambitious reform agenda to reignite economic dynamism, but also the need to reflect on the nature and distribution of economic opportunity in Australia and how we might better connect the benefits of growth to the community, including intergenerationally. 
 
Critical to progressing any such reform agenda must be broad agreement and clarity on the goals of reform and continuing progress on federal-state collaboration and cooperation as exemplified by the performance of the National Cabinet in recent months. 
 
One of the strengths of National Cabinet that we highlight in our Australia’s Federation: post pandemic playbook research paper out today, is that it has had a shared vision and goal.
 
We provide a number of recommendations in our paper on how to ensure that continues, centred on a clear foundation of evidence and clear outcomes to ensure that National Cabinet doesn’t slip back into the mistakes of COAG and act as a handbrake on progress. In addition, we call for the preparation of a whole-of-Federation intergenerational report to inform long term tax and other reforms. 
 
As always, we have a steady stream of content coming up, providing the evidence and tackling the issues we will need to consider in coming months.
 
Watch
We have several high-profile speakers confirmed in the last week for the CEDA livestream so make sure you register.
 
Australia’s defence future will be held on Wednesday, 19 August with Federal Minister for Defence, Senator the Hon. Linda Reynolds, and Federal Minister for Defence Industry, the Hon. Melissa Price. Register here.
 
On Wednesday 26 August, NAB Group Chief Economist, Alan Oster, will present an economic update. You can register here.
 
As mentioned last week we also have a hybrid event locked in with the Queensland Premier, the Hon. Annastacia Palaszczuk, for a Queensland State of the State on Thursday 20 August. You can register for the livestream here.
 
Listen
Out today on the CEDA podcast is a discussion between Andrew Wear, author of Solved! How other countries have cracked the world's biggest problems and we can too, and CEDA Chief Economist, Jarrod Ball, about how we can look to other countries for solutions to the problems Australia faces, and whether or not our cities will be able to bounce back from COVID. Listen in here.
 
Read
In addition to the Federation report out today, on the blog we also have a piece by CSIRO Futures Director, James Deverell, revisiting the Australian National Outlook 2019 (ANO), released by CSIRO just over a year ago. His piece examines the findings of the ANO in light of COVID and the bushfires and how businesses can put the recommendations into practice.

Catch up on content

Also this week, I thought it was timely to revisit some of the content we have had in the last few months that still remains very relevant today.
 
Mental health has been at the forefront of this pandemic. In what seems like a lifetime ago that I sat down with Productivity Commissioner Dr Stephen King for a discussion on the Mental Health inquiry. While at the beginning of the crisis in Australia (I remember back in March we did the elbow bump when Stephen arrived at the office to film in our now empty studio) we talked about the inquiry, what is needed for Australia’s mental health system to meet the requirements of all Australians such as prevention measures and data use, and the impact of crises like the Bushfires and COVID-19 on Australians’ mental health and what employers can do to support their employees in such times.
 
With services like Beyond Blue being a crucial support for many during the COVD-19 crises, we also welcomed former Prime Minister and Beyond Blue Chair, the Hon. Julia Gillard to talk about the early mental health learnings for the community, employers and policy makers from the pandemic.  Mental health has also been a steady feature in the blogs we have published. With contributors from PwC; the Australian Catholic University and Swinburne, we have discussed the impact on the regions, how communities and employers can work to address the growing problem of suicide, and how tech can lead to meaningful mental health reform.  
 
Of course Australia’s health system has also been under the microscope as we’ve witnessed accelerated change. The Sax Institute asssessed the evidence around telehealth, we have heard about the opportunities for data and digital transformation in healthcare and more broadly, asked if disruption drives innovation – and discussed the required regulation for that disruptive technology.
 
How do we make decisions during a pandemic? A once in a century event has forced businesses to quickly adapt and establish what their business looks like now with leaders confronting how they keep their staff and stakeholders safe while making decisions that are critical for their operations. We recently heard from our members in some of our virtual roundtable discussions about how leaders were making these decisions but early on in the pandemic, we were joined by Dr Simon Longstaff, to share how we make ethical decisions during uncertain times. You can also read EY Fellow for Trust and Ethics and University of Melbourne Honorary Fellow, Clare Payne’s piece on how ethical frameworks can help leaders make decision in times of crisis.
 
Over the last few months we have also welcomed Federal Ministers to our livestream including Senator the Hon. Michaelia Cash, the Hon. Alan Tudge, the Hon. Greg Hunt and at State of the Nation, Prime Minister, the Hon. Scott Morrison, and Federal Leader of the Opposition, the Hon. Anthony Albanese. You can catch up with all of these discussions on our YouTube channel which if you haven’t done so already you should subscribe too.
 
With the Closing the Gap announcements last week, we have also been noticing renewed interest in this presentation from last year by Professor Megan Davis on The rights of Indigenous people. It is definitely worth revisiting.
 
Finally, today marks the beginning of Homelessness Week and in that spirit if you haven’t already done so have a listen to my conversation with Anti-Poverty Week Executive Director, Toni Wren. For the first time in a long time, many people experiencing homelessness in our community have had a roof over their heads during the COVID crisis and are getting more consistent health and other care, which is producing savings elsewhere in the system. An interesting policy case study. You can listen here.
 
As always, a big thank you to our new and renewing members this week, who help make it possible for us to keep tackling the issues of most importance to Australia.
 
New state members
Atlas Urban Economics (NSW)
Embassy of France (ACT)
 
Renewing national members
BHP
Shell Australia
Suncorp Group
Transurban
 
Renewing state members
Brisbane Economic Development Agency (QLD)
EISS Super (NSW)
Fisher Leadership (VIC)
GlaxoSmithKlein (VIC)
Queensland Department of Agriculture and Fisheries (QLD)
South Australian Water Corporation (SA)
 
Stay safe.
 
Melinda Cilento 

  

About CEDA

CEDA – the Committee for Economic Development of Australia – is an independent, not-for-profit membership organisation.

We identify policy issues that matter for Australia’s future. We work to drive policies that deliver better economic, social and environmental outcomes for Australia. We deliver on our purpose by: Leveraging insights from our members to identify and understand the most important issues Australia faces. Facilitating collaboration and idea sharing to invoke imaginative, innovative and progressive policy solutions. Providing a platform to stimulate thinking, raise new ideas and debate critical and challenging issues. Influencing decision makers in government, business and the community by delivering objective information and expert analysis and advocating in support of our positions. CEDA's membership spans every state and territory and includes Australia's leading businesses, community organisations, government departments and academic institutions. The organisation was founded in 1960 by leading economist Sir Douglas Copland, and his legacy of applying economic analysis to practical problems to aid the development of Australia continues as we celebrate 60 years of influence, reform and impact across the nation.;
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