The Australia Institute has identified five key questions incoming Governor of the Reserve Bank, Michele Bullock must answer - questions that will ultimately measure her success in the role.
"After years of complacency, there is clear evidence that the Reserve Bank's thinking has become static and insular. Australia does not just need a new governor at the RBA, it needs an RBA that is willing to think differently and listen to a much broader range of voices," said Richard Denniss, executive director of the Australia Institute.
Key Questions for the incoming Governor of the Reserve Bank, Michele Bullock:
- What's the difference?
The outgoing Governor of the Reserve Bank had been in the organisation for 40 years. The incoming Governor has been there for 38 years. How will things be different? How will the new Governor foster much-needed cultural change within the RBA?
- Can the new Governor handle the truth about inflation?
Does the new Governor agree with the OECD, IMF, Bank of England and Australia Institute research, that excess profits are a significant driver of inflation?
- Will the Governor lead an honest conversation about the economy?
Alongside runaway corporate profits, the inflation spike has been caused the COVID supply shock, by the Russian invasion in Ukraine, by climate change and rapidly rising insurance premiums. Governor Bullock needs to make this part of the conversation.
- Is the Governor concerned about the impact of stage 3 tax cuts on inflation?
FOI documents reveal that the RBA has undertaken no analysis of the impact of stage 3 tax cuts on inflation. Will the new Governor commission such work as a matter of urgency?
- Will the Governor stand up to big business and their mates?
The former Governor was quick to call on workers to tighten their belts in an effort to control inflation. Will the new Governor call on businesses to rein in their profit growth and urge the government to consider new super profits taxes and competition policies to deal with firms with excess price setting power?
