Andrew Charlton (Parramatta, Australian Labor Party) Share this | Hansard source

Thank you very much, Chief Government Whip. I always appreciate your support.

Productivity is an incredibly important issue. Productivity fundamentally determines the long-run real growth rate in this Australian economy, and, more importantly, it determines the long-run change in the standards of living of Australians. So this topic is perhaps one of—if not, the most—important topics we could be discussing in this House.

Unfortunately, the premise of the proposition put by the opposition shows that, although productivity is an important issue, it is not one well understood by those opposite. The truth is they don't understand the current productivity issue Australia faces, they don't understand the causes of the current productivity problem, and they have no solutions for how to address those problems in the future. Let 's go through each of these in turn.

Firstly, with respect to the current productivity issue that Australia faces, it is true that labour productivity in Australia has been weak. In fact, in the Annual productivity bulletin 2024 put out by the Productivity Commission, they described labour productivity for the whole economy falling by 3.7 per cent in 2022-23. There's no question that this is a significant drop. For those opposite, the attribution of that drop, the causes of that drop, are all manner of gripes and grievances that they have; anything they can pin on the government's actions to attributed that drop, they will do so. Unfortunately, there is a disconnect between their rhetoric and the reality.

The truth is that all of the things that they accuse the government of doing to produce this productivity fall are not based in fact. Let me read to you the actual facts. This is from the Productivity Commission. They say:

They go on to say:

The decrease in labour productivity was a result of large increases in hours worked for the whole economy and market sector (both 6.9%). This increase in hours worked is unprecedented—the next highest growth rate on record was 4.3% for the whole economy—

as far back as 1988. The Productivity Commission go on to say:

The growth in hours worked outpaced growth in output for the whole economy—

so the cause of the current reduction in productivity, according to the Productivity Commission, is the extraordinary performance of the Australian labour market. That is because those opposite failed to understand how productivity is measured and calculated. It is calculated as the ratio of output to hours worked and other inputs in the economy changing over time. What the Productivity Commission are telling us is that we have an incredibly strong labour market that has produced an unprecedented boom in hours worked, and the consequence of that boom in hours worked is that productivity has fallen. On the first point, the opposition simply fail to understand the cause of the current productivity slump.

Secondly, they fail to understand the long-term drivers of productivity. For them to come into this chamber and suggest that Australia has a contemporary productivity problem ignores their own record on productivity, which, frankly, is nothing less than disastrous. In 2024, the Productivity Commission identified that the productivity growth rate for the most recent five years, a period covered by the opposition's time in government, 2018-19 to 2022-23, was 0.2 per cent; it was 0.2 per cent during the time the opposition were in office. That is around one-sixth of the long-term growth rate of productivity over the preceding 20 years, of 1.3 per cent. They don't understand the current productivity slump, they don't understand its history and they have no solutions for its future.

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