Author
- Michelle Grattan
Professorial Fellow, University of Canberra
The Reserve Bank's rate cut this week will help relieve many mortgage holders, but it wasn't all positive news from the bank. It also underscored the serious productivity and economic growth challenges facing the Australian economy.
The Economic Reform Roundtable next week will be a deep dive into those issues. In its lead up, however, the government is trying to manage expectations, resulting in mixed signals about ambition, outcomes, and timetables for implementing measures.
Meanwhile the union movement has thrown a curveball at the meeting, with the ACTU calling for a four day working week, when industrial relations was supposed to be off the table.
Chair of the roundtable Treasurer Jim Chalmers joins us today to talk about his focus ahead of next week.
On whether there will be more rate cuts this year, Chalmers points to market expectations,
I don't want to interfere with the independence of the Reserve Bank. The market certainly expects there to be more interest rate cuts. The market is usually - but not always, as we learned last month - right about these things.
But let's not lightly skip over the good news from this week. The third interest rate cut in six months is welcome news because it's welcome relief. It puts more money into the pockets of millions of people who are under pressure. It's meaningful cost-of-living relief, but it's also welcome because it gives us confidence that we're on the right track. We are getting inflation down, we are are getting real wages up [and] keeping unemployment low.
Looking ahead to the roundtable, Chalmers says of the ACTU proposal,
It's not something that we've been kind of working up or considering. Our industrial relations priorities are in those areas I nominated, non-competes, penalty rates, paid parental leave. But people will bring all sorts of ideas next week and it's a good thing that they will.
He highlights the work his ministerial colleagues have done to help prepare for the meeting,
The way that they have grasped this opportunity, picked up and run with it, I'm really just extraordinarily grateful for.
[There are] 41 different ministerial round tables often involving more than one minister at a time. Hundreds of people consulted, key stakeholders and so we've got a way to basically funnel the ideas that come from those ministerial round tables into our considerations as a government. But also into the discussions next week as well. We are very aware that once you hold a meeting in the cabinet room with 25 or so chairs, you can't have everyone in there and so the ministers have done a wonderful, wonderful job making sure that as many voices as possible can be heard.
It has been a very, very useful exercise in making sure that we can collate these ideas and see where there's common ground.
A focus of the roundtable is set to be housing and Chalmers says:
one of the defining challenges in our economy that we don't have enough homes. And we think there is a role for better regulation and faster approvals in building more homes. We need to make the sector more productive. We need to get these approvals going faster, we need to make sure the states and territories are playing a helpful role and I think they will. Because this is a huge challenge and the status quo won't cut it.
We need to build more homes for more Australians and I think that will be one of the primary motivations next week. How do we crack open the fact that it takes so long to approve a house when we desperately need more homes in communities right around the country?
On fears that the growing use of AI may lead to a weakening of copyright law to allow AI data harvesting, Chalmers insists the government will not be weakening existing laws,
We have strict copyright law in Australia. That's not always the case in other jurisdictions where they're trying to work this out. And we've made it really clear, […] that we're not in the cart for weakening or watering down those copyright arrangements. In this country we value our musicians, our artists, our writers, our content creators. Even our journalists, dare I say.
On the broader issue of AI, I've tried to encourage a sensible middle path here. And by that I mean we need to work out the best way to maximise the game-changing economic benefits of AI, which are extremely substantial, if we get it right, without dismissing by managing the obvious risks.
The objective there is to regulate as much as we need to - to protect people, to respond to their legitimate concerns. But as little as we can - to encourage innovation, productivity, economic growth and all of those upside game-changing economic benefits if we get it right.
Michelle Grattan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.
