Jim Chalmers (Rankin, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

We now know that the fifth Intergenerational report will be handed down after parliament rises in the last week of this month. It's a really important opportunity for long-term thinking about how we make our economy and our society stronger after COVID-19 than it was before, how we create a new generation of growth and more opportunities for more Australians in more parts of the country. There was a deficit of vision in last month's budget—generational debt without a generational dividend and not enough to show for all of that spending apart from a return to the stagnation of the economy in the years leading up to the pandemic.

The IGR can help rectify this short-sightedness but only if it's a serious document taken seriously by those opposite. Mr Speaker, the Intergenerational report has a chequered history. It began as a great idea, and I know that you know that, because it was hatched in your time in Peter Costello's office. The goal was to detail economic and democratic trends over the next 40 years and to analyse their impacts on government finances. The first IGR was released in 2002 and the second in 2007. I worked on the third in 2010. We took a slightly broader approach, supporting productivity through investment in infrastructure, skills and education; overhauling our health system to ensure it delivers value for money; adhering to a disciplined fiscal strategy; and addressing the challenges of climate change.

Both sides delivered three quality documents. They were a credit to the Treasury. But the extreme politicisation in 2015 of the fourth IGR by the Abbott government was a very disappointing development. That was just a political exercise to justify the horror 2014 budget and to score political points over fictional Labor policies. It was clear even before COVID-19 that the government had also got some of its projections wrong. Productivity growth, rather than ramping up to the 30 year average growth rate of 1½ per cent had stagnated, and continues to stagnate, driving wages growth to historic lows. Over the five years since the last IGR was published, productivity grew by just half a per cent a year on average and wages growth averaged at just 2.1 per cent per year. The projections for real economic growth were also way off. Annual growth slowed in the ensuing five years to just 2.4 per cent on average each year. Growth in output per person slowed to just 0.8 per cent per year in the five years since the report was published. The last IGR also ignored key challenges, like climate change, altogether—one of the key intergenerational threats to our economy and budget.

This month's IGR has been delayed by a year and we've barely heard peep about it. This doesn't give me confidence that it's treated as a priority or as an opportunity. Given the form of those opposite, we have low expectations for anything other than another partisan exercise designed to justify harsher cuts to Medicare and the NDIS, and that would be very disappointing again. This IGR should be an opportunity to improve long-term thinking and drive a resurgence in growth, job security, wages and broad based prosperity. It could, and should, be a pivot point to modernise our understanding and our thinking on climate and energy, on the care economy, on work and family, on digitisation, on population and on our place in the world. That's why we need to elevate and refocus the IGR. It could be released in the middle of each parliamentary term, on an agreed, consistent template, supplemented by more topical analysis. It could do a much better job of measuring what matters, like a permanent focus on intergenerational disadvantage, geographic disadvantage and economic mobility alongside all of the usual traditional economic measures. Climate change and energy should be a permanent feature as well. It could better evaluate which policies work over time, which ones represent true value for money and which ones don't.

For the second time in just over a decade, Australia risks overperforming in a crisis and underperforming in the aftermath. Without a comprehensive vision for economic reform, it's unlikely that economic growth, living standards and incomes will perform any better over the next 40 years than they have in the last five. We won't get that comprehensive vision without a comprehensive IGR. That's why this Intergenerational report can't be another missed opportunity like the government's budget was.