The Productivity Commission’s Inquiry: Australia’s Future Prosperity

December 13, 2016

Work and Workers

The Productivity Commission is holding an inquiry into Australia’s productivity performance and provide recommendations on reform priorities.

It is the first in a regular series, done at five-yearly intervals, to provide an overarching analysis of where Australia stands in terms of its productivity performance, and to develop and prioritise reform options to improve the wellbeing of Australians by supporting greater productivity growth.

Per Capita applauds the government for commencing regular productivity reviews. We believe that a combined and integrated focus on productivity, inequality and sustainability is essential to ensure sustained high quality of life for the Australian population. Per Capita endorses the broad scope of this review, in particular the inclusion of non-market areas, domestic productivity and inequality.

We would like to have seen a greater emphasis on environmental sustainability in the scope and terms of reference for this review and an explicit consideration of the impact on quality of life of productivity enhancing policies.

The distributional impacts of future productivity improvements are extremely important and will be largely determined by the relative power of capital and labour. Government policy has a role to play in influencing distributional outcomes, not only through the tax and transfer system but through the structural and legislative systems that influence the power balance between capital and labour.