First published in The Australian, 26 August 2013
We are now three weeks and two debates into a watershed election campaign and are we any the wiser about securing Australia’s future?
I’ve watched many elections. We are seeing the opposition do what oppositions do by waiting until the last minute to release policy costings, and the government do what governments do in repackaging and selling old messages and covering up any perceived failures over the past few years. Within the political theatre, both parties are playing their respective roles.
The universal political truth in all this is that governments, not oppositions, win or lose or elections. History reveals a flat lining of support at the end of the Keating and Howard governments, and the current government’s efforts to separate itself from the past in an attempt to suggest a new future indicates history may be repeating.
From my many interactions with business leaders, particularly over the last few weeks, it is clear that frustrations are running high over the government's fixation on forecast figures and costings, and their desperate need to justify numbers and promise a return to surplus. It has taken much of the oxygen out of the election campaign, leaving little to support debate of the major and very real issues facing Australia.
The singular achievement of the campaign so far may be the unintended collaboration of both parties in discrediting each other’s numbers.
Treasury’s explanatory notes accompanying the Pre-Election Economic and Financial Statement (PEFO) highlight that global economic uncertainties make strict adherence to the numbers a fraught exercise. “The average annualised nominal GDP growth over the two years 2011-12 to 2013-14 is expected to be a little over 3 per cent, with the 70 per cent confidence interval over the two years from 1¾ to 4½ per cent.”
In 2010 when corporate Australia was praising the chase for a surplus, CPA Australia said what many are saying today, that a surplus for its own sake is not the real objective. The objective is to plan ahead and establish an environment to take Australia forward and allow business to compete.
With Treasury urging caution on the numbers and both major parties cancelling themselves out, what does a cynical electorate have left to focus on? Yes, the government’s finances are an important issue but it would seem we are now so obsessed with the figures that we can’t see the wood for the trees. The answer is the future - and the need to actually develop a strong, robust and visionary policy agenda for Australia.
Australia’s future rests with economic and competitiveness reform. While voters have endured many hours of media commentary and debate on forecast numbers and trying to guess when the Opposition will release its figures, there is an innate understanding in electorates across the country that the policies we pursue and the decisions we take from 8 September 2013 onwards will define Australia in the 21st Century.
This is the main game. The challenges for our economy are real and urgent.
Back in 2002 with the release of the first Intergenerational Report the then Treasury Secretary, Ken Henry highlighted the need to lift Australia’s ‘three Ps’- population, participation and productivity – as the three key drivers of economic growth. Since then, this phrase has been repeated over and again by both sides of politics. During this campaign it appears we’ve seen only three policy proposals which directly attempt to address at least some of our growth and competitiveness challenges. A well-developed plan to tackle over-regulation and red tape will boost productivity, a paid parental leave scheme will build population and participation and in the longer term productivity, and a cut to the corporate tax rate will drive productivity and business confidence. Australian business and the general community is looking for more such policies which provide a roadmap for our country to create stronger links with Asia, reduce transaction costs for business, harness new and emerging opportunities and better leverage key markets for our products and services.
Parents and guardians, obsessive about the future of their children, know that the high-paying jobs of the future will come from a versatile, agile knowledge-based economy, and that arguments about costing variances in 2016-17 have nothing to do with that.
If we truly care about employment, then being relevant in a competitive world matters. Emerging economies such as China and Indonesia are in the process of transitioning to service-based economies. Political and business leaders in these markets tend to look, listen and learn to build knowledge and economic capacity and then, as you would expect, do it themselves. Where does that leave us?
We recently saw Ford reach the painful decision that it could no longer competitively produce cars in Australia. For a number of years they have been battling costs that are twice that of Europe and four times that of Asia and my heart goes out to all those affected by the coming closure of Ford's manufacturing plants. There is reason to be optimistic because at our core we are an innovative people. This is reflected in Ford's decision to retain in Australia a Centre of Excellence for Vehicle Development that will keep highly skilled jobs in Australia.
We are now entering the business end of a pivotal Federal election. In Australia's economic history this is the time to make the hard decisions: to invest and to revitalise Australia's international competitiveness. Without this, and the political will to move us forward, my fear is that we will look back in six years to the 2013 election as a national turning point, where we had the chance to ensure the Asian Century is the Australasian Century, but didn’t grasp it.
I know which future I want for Australian business and for Australia – let’s just hope our political leaders rise to the challenge in the final two weeks of the campaign.
Alex Malley is the chief executive of CPA Australia