Welcome everyone to day 2 of the Economic Reform Roundtable. I wanted to begin really with my thanks for the way that people engaged yesterday in a really constructive way. Not always reflected in the coverage of yesterday, but don't be deterred by that.
Yesterday I think we saw some really welcome signs of developing consensus around a number of really important areas. Whether it be capital flows in our economy, whether it be human capital, the way we think about our role in the world and our opportunities in a global economy which is more volatile and unpredictable. I thought yesterday was absolutely terrific, frankly, the way that people engaged with each other.
By my rough count there were about 100 contributions made yesterday in one day and that is a sign of the way that we are engaging and grappling with some of these big challenges in our economy in the way that we had hoped. So really to begin with our thanks, for the way that people came at yesterday. And hopefully we can maintain some of that momentum today.
The first day was about resilience, today is about productivity and tomorrow more fundamentally about the budget. But we all know those 3 things are very tightly linked. Productivity really sits at the core of so much of what we're trying to achieve. In the conversations yesterday about attracting more investment, about capital deepening, capital flows in the world and in our own economy, a lot of the issues that we'll get into a bit more detail today were introduced. So yesterday was a welcome start, as well when it comes to those sorts of issues.
Now, one of the reasons why I think all of the effort that's gone into this roundtable is already worth it is because we have been able to collectively put a more productive economy really at the core of the government's second term agenda. And the way I think about it is that we've made all this progress on inflation, employment, real wages, broader measures of incomes and living standards. But really the only way that we maintain and sustain and prolong that progress, bake it into our economy is if we make our economy more productive. We don't see that as making people work longer for less. We see a much broader agenda when it comes to productivity.
And I acknowledge Danielle's work in this regard. Thinking about productivity through a much broader lens - the energy transformation, the technological opportunity and particularly AI, the care economy, competition and dynamism, human capital. This is where we'll get the productivity growth that we need in our economy to sustain and grow living standards over the long term. And higher living standards are really the holy grail for all of us and productivity is central to that and that's why it's the central focus.
Productivity is the central focus of the government, of today's part of the roundtable, but also the work that we will all do in the months and years ahead. It was a really deliberate decision by our government to put productivity at the centre of our economic agenda and that's primarily or exclusively because that's how we get those higher living standards that we need to see in our economy.
A lot of you have got your own analysis in your own industries, and your own parts of the economy about how we make it more productive and that's what today is about teasing all of that out. We released that issues paper and Danielle has released a lot of analysis too. And really we released that before these discussions because let's not spend all of today agreeing that we have a productivity challenge in our economy, let's get specific about the things that we need to do together in order to turn that around.
Bran said yesterday in ways that I'm grateful for that one of the things that we did deliberately at the start of this term in acknowledging all of the progress we've made in the economy, is that clearly our economy is not productive enough. That's not a challenge that has only shown up in the last few months or the last few years. It's been really a big challenge in our economy for a couple of decades now. And we saw that in the fact that the weakest decade for productivity growth in the last 60 years was the 2010s.
We know that this is a longstanding challenge, we know that it's also a global challenge. Almost every comparable country has a version of the productivity challenge that we have. And so it has been baked in for a long time and it's a global challenge. But that doesn't mean that we can't work out ways collectively, consistent with our values as Australians to turn that productivity performance around.
In the Incoming Government Brief that Treasury provided they identified 4 reasons why we don't have the productivity we need in our economy yet. Firstly, it's not dynamic or innovative enough. Secondly, we haven't got that capital deepening that we talked about in some detail yesterday. Thirdly, we're not doing as good a job as we can matching skills with opportunities. Again, a big focus of yesterday.
But also our changing industrial base and particularly the growth in services has made productivity gains harder to measure but also harder to find. And so that's a key part of our considerations as well. Also, in the care economy we recognise that productivity is not the only thing that we care about. Quality is obviously the primary concern there and I want to acknowledge that Minister Butler is up at the Press Club later today talking about some issues as well and the timing of that is perfect because that will lead into discussions that Katy and I will have with you all tomorrow about the budget, as well.
Today to kick us off we're going to hear from Danielle Wood. I really wanted to thank Dani for all of the work she's done in those 5 interim reports that a lot of you have been responding to and grappling with. Those 5 reports are based on what we see as the 5 pillars of productivity. Our agenda is basically dynamism, net zero, skills, data and digital, and care. And we have made some progress on all 5 of those fronts in the last few years. We have actually responded to about two‑thirds of the directives that were in Michael's report before the leadership of the PC changed. I welcome Michael for being here as well.
We've been strengthening our competition settings with Gina's help. We've been abolishing non‑compete clauses for workers. We've been trying to attract more investment to deepen the capital base. We have cut already about 500 nuisance tariffs. And today really is about trying to build on that progress and build on that work.
The reports that Dani has released have in welcome ways I think attracted a lot of your attention and feedback and engagement. The thing that I appreciate about the effort that Dani and her colleagues at the PC have put in is the way that they have boiled down this challenge in 3 important ways. First of all, that we have to regulate with growth in mind. Secondly, new ideas and technologies will be key. And thirdly to recognise that the progress that we want to make on productivity will take time. That challenge has been part of our economy for a long time, it will take time to turn around. If there was one switch that we could all flick to instantly make our economy much more productive, somebody would have flipped that switch already. This is about making cumulative, consistent progress over time. Working out where the genuine barriers are to a more productive economy and working out if we can overcome those barriers together. That's really the theme of those sessions today.
Today there are really a few pieces that we will discuss in detail. At the start we'll be talking about regulation and approvals. Better regulation, making sure regulation is serving a useful purpose. Making sure approvals can be quicker without ignoring our responsibilities to communities or to the environment. How we can quicken the pace of approvals so that we can build more of the stuff that we want to see in our economy. An important focus today on competition and dynamism in the context of the federation as well. Making the federation work more effectively in the interests of the states and territories and the Commonwealth and the national economy. I think there should be a lot of win‑wins there.
And then finishing the day on artificial intelligence and data and digital more broadly. The role of accelerating technological change and what that means for this productivity challenge. How we can maximise the benefits of AI and minimise the risks to workers and communities, and to our content at the same time.
So that's what's ahead of us today. I really again wanted to finish where I started and say thank you for all the work that's gone in already. The spirit you brought to the conversation yesterday was really welcome, as I said at the start. We genuinely believe that the only way to deal with this productivity challenge in our economy is to do that together, involving you where we can. Not because we will all have unanimous views about how we go about that, but I do think there are large swathes of what we need to do together where there is consensus emerging and that's very welcome. And it's only possible because of the way that you've approached these discussions.
As we said yesterday we need to keep front of mind what all of this is about, it's about creating more opportunities for more people in every part of our country, lifting living standards by making our economy more productive, that is the holy grail for us and that's the focus of today. But not just today, all of the work that happens after here as well.
With that I'll thank the media and excuse them. And then in a moment we'll throw to Danielle who's going to kick us off by running through the work the PC has been doing. Thanks very much media.
