Tammy Tyrrell (Tasmania, Independent) Share this | Hansard source

I move:

That the Senate—

(a) notes that:

(i) productivity growth is at its slowest rate in 60 years,

(ii) as a result, people born in the 1990s are the first in multiple decades to miss out on generational progress in incomes, enduring comparatively worse standards of living, and

(iii) a boost in productivity growth to the historic average by 2035 would put $14,000 per year in current Australian workers' pockets;

(b) believes that the productivity-enhancing initiatives proposed by both the Government and the Opposition to address productivity stagnation are insufficient to meet the scale of the problem; and

(c) calls for more effective productivity growth measures suitable for today's economy, to ensure that today's Australians get more in their pockets, and that our children experience better standards of living than us.

I read an interesting article in the ABC the other day called '23 big ideas to boost Australia's productivity'. It had different experts in different fields pitching what they think a big, transformative change that would increase productivity would be. The advocacy group Indigenous Business Australia suggested that we should invest more in Indigenous businesses. The CEO of mental health charity Beyond Blue suggested we should invest more in mental health. A professor at the Queensland University of Technology School of Earth and Atmospheric Sciences suggested we focus on air quality. These people all suggested that the way to boost productivity is to boost their particular cause. This has been the problem plaguing the productivity debate for a really, really long time. Everybody's got a different idea of what it is and what it means, and that results in different ideas about what to do about it. Some people use that confusion to push their own interests, and we end up getting nowhere.

Part of the reason productivity debates get muddled is that the word 'productivity' itself is so muddy. What does productivity feel like? What does it look like? Nobody can picture it; nobody can experience it. It's just kind of lingering around in the public policy debate. Productivity, I think, is a means to an end. When we talk about productivity, we talk a lot about the means, and that's fine. But, if we want people to care about this, pay attention to this, get excited about this—and we should want that—then we need better language around it. When we say 'productivity', we should really be saying 'quality of life'.

I'm a parent, and I think what I want for my kids is the same as what any parent in Australia wants for theirs. We want for them a better life, an easier life. We want our kids to thrive in an environment where everything they want to do is available to them and everything they want to experience is there. We want them to be good people, responsible people, kind people. We don't want them to know what hunger or pain feels like. And we want them to experience that feeling of abundance—that they can have it all. To me, that's what quality of life looks like. The way we get there is through productivity. The future generation should be left a valuable and strong economy, so that they can actually afford things.

People of my age have already experienced that, courtesy of the work put in by the generations of our parents and their parents. It's an intergenerational gift. We don't always recognise and appreciate it, but, believe me, when you take that flight to Bali with a ticket that cost you the equivalent of 12 hours of work and sleep in a hotel that would have cost you about the same—in the end, you're looking at a week's worth of work to pay for a week-long beachside holiday—you notice it. Let's not talk about whether you took the kids with you too, though! That is the kind of luxury that people a hundred years ago would have killed for. Productivity makes that possible, and now we aren't growing in efficiency the way we had been growing for decades before.

The reason we're stuck in the same productivity swamp we've been in for years is simple: our political system is built on a seesaw of competition between unions and business. When the Labor Party gets in, unions see an opportunity to reverse all the pro-business policies that the Liberal Party introduced and make it easier for unions and employees to capture a bigger part of the pie. But, because unions don't represent the same share of the workforce as they used to, they long ago realised that the fastest and easiest way for them to make economy-wide changes in their favour is to make economy-wide laws. To do that, they need lawmakers—that's the Labor Party.

Then the Liberal Party accuses Labor of being a mouthpiece for the union movement, and the Liberals get back in. Business groups see this as an opportunity to reverse all the pro-union policies that Labor introduced and make it easier for businesses to capture a bigger slice of the pie. But the business lobby are not as influential as they once were, because the public doesn't really hold them in high regard. They have money when the going's good, but the going's not always good, and businesses, at the end of the day, don't vote, so they have a structural disadvantage in this fight. The best they can do to even the ledger is give money. And, when they do, the Labor Party accuses the Liberals of being in bed with their big donors, business interests, and all about the big end of town, and the popularity of the Liberals suffers—until they're kicked out, and the unions see an opportunity.

This is the dynamic of the modern two-party system. It's been the same dynamic for the past 50 years at least. We as a country can't really meaningfully improve productivity when two major parties are focused on undoing what each other last did. We can't meaningfully move the needle if each of the major parties is financially dependent on an increasingly sidelined interest group focused on pushing its agenda. Business says we should streamline workplace laws, cut red tape and reduce taxes. The unions say we should avoid any of those things and instead pay workers 20 per cent more per hour. Does this not have a familiar ring to it? This is what people were talking about when John Howard was prime minister. We're debating solutions that are old enough to vote!

I think a really simple way of measuring what productivity would look like is to look at how desperate businesses in Hobart, Launceston and Devonport are for staff. They are reliant on staff who are on temporary visas in order to meet demand, and they are constantly losing them, having to find more staff, having to retrain them, then losing them all over again. The biggest thing we can do to help these businesses that are suffering from a staff shortage is to deliver efficiency benefits that make it possible to say that the thing that takes three staff today will require only two staff tomorrow. That would reduce their pressure hugely. It would mean more businesses are open. We have businesses in Launceston that are permanently closed, with signs on their windows saying they could not find staff. It's like a gravestone: 'Here lies the dream of that small-business owner who took a risk'—starting a business, trying to be their own boss but they couldn't outrun Australia's slow productivity growth.

Labor is today patting itself on the back for cutting a series of nuisance tariffs. And great; do it. But the effect of this is on productivity is going to be a fraction of a fraction of a per cent. Would we even notice the effect on our productivity growth rates? We need big-picture changes, things that will make a large, permanent difference in the cost of doing business. Here are a few things you won't hear from the major parties, though. A labour market needs complete restructuring, not minor tweaks. We could replace the current maze of seven different leave types with a single universal leave allowance of 25 days annually, weighted down from current total entitlements and based on actual usage patterns. Workers could use these days for any purpose—illness, holidays, family emergencies or personal time—without requiring a different approval process or documentation. Businesses would deal with one simple system instead of tracking multiple leave categories with different rules and obligations.

While we're at it, we should scrap long service leave entirely. It's essentially paying people to stay put rather than find their most productive role. The average long service leave liability represents around two per cent of total wages annually. But we don't want people losing out financially. Instead, mandate that this amount be paid as an immediate productivity bonus, distributed quarterly based on measurable performance outcomes. This would reward actual contribution rather than tenure and would remove barriers to job mobility that trap workers in suboptimal roles and prevent businesses from accessing the best available talent.

Currently employers must advertise locally for at least four weeks, demonstrate that they couldn't find suitable local candidates, and maintain detailed records proving the genuine need for overseas workers. This applies across the board, from fruit pickers to software engineers. The whole system is built on the flawed assumption that businesses would rather deal with visa complexities than hire locals if locals are available. In reality, businesses always prefer local hires when possible, because they're cheaper and simpler. Locals stick around for longer. The labour market testing requirement just adds months of delay and thousands in compliance costs for no productivity benefit.

Instead of making businesses prove that there's a skills shortage in their specific location for their specific role, make it the federal government's job to maintain a real-time national skills shortage list based on actual labour market data: unemployment rates by occupation, wage growth trends, job vacancy duration et cetera. If you can demonstrate competency in a shortage skill area through practical assessment like trade tests, coding challenges or portfolio reviews, you get immediate work rights—no employer sponsorship, no labour market testing, no bureaucratic gatekeeping.

The complexity of our current approvals system is itself a massive productivity drag. The time it takes to get a mine from approvals to actually digging is almost a decade. The problem is that bureaucrats responsible for ticking these things off do not want to be the one that approves an environmental disaster. There is no reward for approving something that doesn't cause a scandal, but there is huge punishment for being the one that ticks off the approval that does. So the incentives of the bureaucracy responsible for the approvals are all stacked in slowing things down, triple-checking everything, double handling and making sure responsibilities never rest with one person. Aligning the incentives of the bureaucracy with the interests of the project proponent is the theoretical ideal, but it opens up all sorts of corruption risks. You don't want bureaucrats getting cash payments in exchange for approving things that really should not be approved.

I think a productivity-enhancing solution would be to introduce skin in the game without giving cash to bureaucracy. The federal government could introduce a statutory project approval guarantee in law that is a predictable, enforceable assurance to applicants that you will get a final answer by a certain date. If that date is passed without a final decision, the federal government would pay interest on projects over $100 million at the market rate cost of capital for the project. With safeguards like a stop-the-clock mechanism, where the clock isn't ticking while the government is waiting for information from the applicant, you could see bureaucrats facing pressure from ministers as to why a decision has not been made, and they would see their own budgets being hit if they drag their feet. It would mean more project applications, and it would see their decisions being made sooner. We're reducing the cost of getting big things done simply by changing incentives around.

I am putting forward these ideas not because I think they are the best the country has to offer; I am putting them forward because they're ideas that haven't been put forward before. That, if nothing else, makes them worth considering. Anything we can do to get ourselves out of this stalemate of stale ideas is worth doing. Why? Because I want to make sure that we're richer tomorrow than we are today. I want leaders who want the same. This is my way of saying it's not that hard. Let's get the conversation going.