Protecting Australian living standards

The Productivity Commission’s Shifting the dial report provides a road map to higher living standards “that should be professed by all levels of government and the Australian people over many years,” Federal Treasurer, the Hon. Scott Morrison said when launching the report at a CEDA event in Canberra.

The report, the first of a series of five-yearly reviews commissioned by the government, addresses factors and influences that may affect Australia’s economic performance over the medium term and offers advice on policy priorities.

Drawing on the report’s findings, Mr Morrison said improvements to health, education and how we manage population growth in our major cities are areas requiring reform. The report calls for:
  • more integrated and patient centered healthcare to create more healthy workers;
  • a more proactive education system that supports better teaching to create more proficient, more resilient and more adaptive workers; and
  • more functional cities that will not choke our economy.
Focusing his speech on protecting Australian living standards, Mr Morrison said strong jobs growth and a brighter picture emerging for the global and domestic economies indicates better days ahead.

“Annual jobs growth is now running at over three per cent, fifteen times greater than it was in 2013 when the Coalition Government was first elected,” he said.

“Since then, 825,000 jobs have been created and almost two thirds of those jobs have been secured in the past two years.”

However, despite the strong jobs growth and business conditions, Mr Morrison warned against complacency.
“For wages to (continue to) increase we must also increase business investment and drive a new wave of productivity growth,” he said.

“It’s estimated by the commission that we need labour productivity growth in or around 2.5 per cent to maintain the growth in our living standards. Any less than that then we’ll see living standards erode.”

Mr Morrison said the report sought to provide a direction, rather than a specific ‘to do' list for governments to immediately achieve, or be forced to rule in or out.

“So we are at a crossroads. The Productivity Commission has shown us a path to update our national productivity agenda to ensure we not only maintain our living standards, but lift them,” he said.

“This is not the sole responsibility of a Federal Government.

“Experience shows that sustained growth in productivity is reliant upon governments working together, not going it alone.”