7 September 2015
ACOSS CEO Dr Cassandra Goldie, published in The Australian Financial Review, Monday 7 September 2015
A wise woman once told me, ‘never assume where you will find your allies.’ It was sound advice that has stood the test of time. For ACOSS, the National Reform Summit was just such a case in point. For weeks, representatives of business, the ACTU, and the community sector, young people, and older people, worked hard, behind the scenes, to find our common ground and we succeeded.
Our great risk was that, on the day of the Summit, with the searing scrutiny of the major media groups on us all, our consensus would unravel. The contrary occurred. As our conversations built on each other, it affirmed to me that there truly is more that unites Australia’s business, union and community sectors than divides us.
We all knew that, as we transition from boom-time to less certain times, our nation appears to have lost its way. We are one of the wealthiest countries in the world. Most of us enjoy living standards better than we have ever seen. Yet, in the face of intense global competition and uncertainty, our economy is slowing, unemployment is on the rise, basic protections are at risk, too many people live in poverty, and housing is less affordable than ever.
Without determined efforts now to secure durable Australian reforms, progress will be much harder to achieve over the next decade than the last. Our risk is a more divided future, our responsibility is to strengthen our collective efforts now.
The Summit demonstrated firstly that business, unions and civil society all recognise the seriousness of these challenges; and secondly, that there is a genuine basis for agreement across the community on the path ahead. The key to this consensus was our recognition that equity – fairness – does not have to be sacrificed to achieve economic growth, nor does growth have to be given up to achieve fairness. Our consensus was that economic growth is dependent upon a commitment to equity, as the IMF and the OECD have now been telling us for some time.
We agreed that budget repair needs to focus on both revenue and expenditure, with intensive design work done now, to get us ready to begin serious transition within two years. We should act immediately on reforms clearly consistent with our approach. Our aim is to deliver structural balance within 10 years.
We agreed that, on expenditure reform, we should focus our efforts on the fastest-growing areas of expenditure, particularly health and the retirement incomes system. This would avoid scattergun approaches to budget repair like we saw in the 2014 budget, which focused on programs that were not projected to grow strongly in the first place. Both these areas require serious re-design, using the best evidence and expertise to transform their effectiveness and economic efficiency.
We agreed that, on the revenue side, our focus should be on winding back tax concessions that are no longer fit for purpose. In our view this is the only realistic approach – this is where Governments should now go in ending the ‘age of entitlement’.
Our persistent call for focus on the retirement incomes system is right, with both serious revenue and expenditure implications. Despite the fact that the Federal Government has seemingly ruled out any changes, there was consensus on the need for reform of superannuation tax breaks. It was acknowledged that the current retirement incomes system isn’t working for everyone, especially for women, people with interrupted careers, and low income earners.
We agreed that we must strengthen our economy, lifting productivity growth and workforce participation. It was pleasing to see the Summit groups agree to work together and with governments to improve opportunities for people who are locked out of the labour market, and to work intensively on reforms to lift productivity through innovations, skills, and infrastructure investment, not by driving down wages and conditions.
There was clear recognition that it is in the interests of both enterprises and communities to open up the ways to attract the additional workers needed to grow the economy as our population ages, and to provide the right policy settings to foster and support the enterprises of the future.
Crucially, the Summit recognised the risks and opportunities of climate change. The longer we delay Australia’s adjustment to energy-efficient industries and jobs, the tougher that adjustment will be for everyone.
Some critics will be disappointed the Summit didn’t strike any ‘grand bargain’. This is a lazy view. Real gains require commitment and sustained effort. Isn’t that what we tell our children?
The Summit was an important next step towards effective reform, and an event imbued with genuine goodwill. It built on our past collaborations, extended them further, and – we hope – provided the wider community with a sense of hope and optimism for future effort – an antidote to the division and short-termism that plagues Australian politics at the present time. We understand that our politicians are elected to decide how governments respond to these challenges, but they cannot be resolved by governments alone.
The organisations at the Summit represented people from different walks of life, views and interests. In reaching across traditional divides, we are bringing the community into the effort. It is not about a group of elite stakeholders cutting a deal that we can then “sell” to the public. Ultimately the only way to achieve reform is if the Australian public understands the problems we face and has a role in shaping the solutions. That requires all of us to do our bit.