January 21, 2014
Whilst Peter Reith continues to bang the labor market reform drum in the Fairfax Press the politics of austerity is slowly being put into place. We really wont know much until Budget time 2014. Presumably this is the best way to build the trust and confidence between government, business, non- government organisations and the community that are required for major reform.
From what we can gather so far is that he Coalition's template to address the structural budget and economic issues facing Australia is pretty much the agenda of the Business Council of Australia. The official line is that the Commission was “not ruling anything in or out”, and that it was up to the government to decide how to act on its recommendations. Well, not quite. The Commission’s brief is to focus on cost-cutting because ways to increasing revenue are not on the table. They are not part of the Commission's brief.
So it is austerity not long term economic reform--eg., a comprehensive and coherent national energy policy. The Business Council of Australia's position is that Australia's competitiveness has declined and our chances of maintaining the rates of economic growth that we need are far less certain:
we are staring down the barrel of almost a decade of deficits. This is the result of not having lived within our means, of not spending taxpayers’ money wisely in ways that boost national productivity and competitiveness, and committing to new long-term programs without a matching source of new revenue.....unless future governments reprioritise spending, and reduce the size and scope of government, they will have virtually no discretion to respond to the priorities of the day, let alone deal with the emerging and well-known pressures on the budget.The only way to get the budget back in order for the long term is to go back to basics with an audit of the scope, size and efficiency of government spending together with a disciplined approach to any proposals for new spending.
We can expect recommendations for a privatisation of government assets, the outsourcing in the form of the externalisation of services to commercial organisations, the reduction in unproductive regulation (ie., red and green tape), more flexibility and productivity in our workplaces, investment in the right infrastructure to ensure a productive economy (ie., to help business) and greater application of user pays.
What will be excluded is government subsidies to Big Business--Big Mining, the private health industry, the fossil fuel industry, trade-exposed industries etc. because this does not form part of the Business Council of Australia's overarching vision of securing enduring prosperity for all Australians.