Australians living longer and healthier lives –
In a country powered by renewables and transformed by technology –
With care and compassion at its core, adding value and maximising opportunities in a world of churn and change.
An Australia of generational responsibilities and endless possibilities.
A future we can be optimistic about, but not complacent about.
That’s what the Intergenerational Report lays out for us.
Its 40‑year horizon seems like a long time –
But it’s a flicker compared to the tens of thousands of years of history that the Ngunnawal and Ngambri people have shaped on this country.
We acknowledge them today, their elders, traditions, customs and culture –
And we acknowledge and embrace the generational opportunity the Voice presents –
To recognise, and listen, and get better outcomes for the first of us –
In a way that could lift up and unite all of us.
The Ngunnawal people speak of mura gadi.
Mura gadi means ‘pathways for searching’ in their language.
The IGR we release today is a form of mura gadi –
Because it’s about searching for the right path together.
I want to thank Maurice and the Board for the invitation back to the Press Club to talk about it, and to Laura for the introduction.
To the sponsors, to colleagues who have joined us –
Especially from the economic team, Katy, Stephen, Andrew –
To all of you here today or tuning in – thank you.
It’s been three‑and‑a‑bit months since the last time –
In May, the day after Budget.
Back then, in the Great Hall, I tried to give you a sense of how Anthony’s government is serving urgent priorities like addressing the cost of living, and our generational responsibilities at the same time –
Not just seeking to end a wasted decade but beginning a defining one –
And laying the foundations for some broader long‑term success in our society and our economy.
Today is about informing and building on that work.
Informing and reforming.
With the release of an Intergenerational Report that sets out our imperatives and opportunities for the next 40 years.
A lot of effort has gone into it, so I want to thank my ministerial colleagues who provided input and the Treasury and other officials, under the leadership of people like Steven and Jenny, who worked around the clock to put it together.
The sixth IGR
The analysis that some of you have been poring over this morning is the kind which supports Australian policy making at its best.
Rigorous –
Impartial –
Steeped in evidence, methodical, and urging us to think creatively about the future.
The early IGRs had such an important and meaningful impact.
Here I pay tribute to Peter Costello for getting the ball rolling –
For showing us in the first two IGRs the consequences of an ageing population on the Budget –
And Wayne Swan who then brought a welcome focus on climate change.
A common perception is that the fourth and fifth IGRs lost their way a bit.
Instead of setting out a shared sense of the things that will shape our future –
Joe Hockey’s was more focused on shaping the politics of the day.
And Josh Frydenberg’s in 2021, more or less buried under heroic productivity assumptions and a lack of interest or action – was barely referenced after the day it was released.
I thought that was a shame then, and a shame now.
Because it meant that instead of broadening our horizons –
These IGRs narrowed them.
Now, in hindsight, they look even more like two punctuation points of missed opportunity, in a wasted decade full of them.
That’s why we’ve approached this report with extra care and diligence – and enthusiasm.
We’ve put it out early in our term – as part of a broader commitment to release it more frequently –
Done our best to make it deeper, with more focus on the changes underway in our industrial base, our economy and our society – not just our Budget.
And made it a significant part of our efforts to revitalise policy thinking, renovate our institutions and focus on our big national challenges and chances.
This IGR sets out the choices that will determine whether we succeed or fail in the years ahead –
It sends a pretty clear and compelling message:
We can own the future.
But only if we take the big shifts seriously.
Because if the 1980s meant the End of Certainty.
The 2020s must mark the End of Complacency.
We know this IGR comes at a difficult moment for Australians right around the country –
That today, our immediate obligation is to do what we can to ease cost‑of‑living pressures without adding to inflation.
But the critics out there who say that we need to wait before engaging with our long‑term prospects just don’t seem to get it.
There will never be a quiet time to think about the future –
There will always be competing pressures and urgent calls on our attention.
The best leaders can focus on more than one thing, more than one horizon, more than one set of opportunities.
That’s what good governments do, and we’ve shown that –
By progressing a Voice, while investing in our future –
Repairing the Budget, while rolling out billions of assistance to help with cost‑of‑living pressures –
And taking the edge off power bills, while steering us towards a future of cleaner, cheaper energy.
Snapshot of the IGR
The IGR that we’ve released today gives us a sense of the context in which that future will play out.
Some in this room have spent hours with it already – others perhaps coming to it for the first time.
What you have seen or will see in the pages of the report, is a country where people will live longer, healthier lives–
Where real incomes are 50 per cent higher –
With the economy more than double today’s size.
But as our population ages, this will create some challenges too.
Challenges to our Budget, and challenges to growth.
As we age, there will be a smaller share of working‑age people –
Putting pressure on our tax base –
At the same time as we face growing spending pressures –
From the NDIS, aged care, health, defence and debt interest costs –
Which could keep us in deficit and put debt back on the rise.
Our early efforts to repair the Budget mean that the outlook is better though – when compared to 2021 –
Putting us in a stronger position to sustain essential services.
Our economy will expand substantially – as I’ve just outlined –
But our productivity challenge, which we’ve reflected in the adoption of a more realistic assumption –
Means that overall real GDP projections are down from the report released a couple of years ago.
That’s a snapshot view of what things could look like in 40 years.
But there have been enough of these reports that it’s now understood that the projections made here aren’t predetermined.
There’s a level of confidence, but not certainty, about how the coming decades play out for us.
But the most important thing about this IGR –
Isn’t the overall predictions about where we might land – as informative and illustrative as they are –
It’s the choices that it sets out for us.
The big five shifts
This matters most when it comes to handling the biggest shifts that will determine the shape of our future.
Here, we need to recognise the difference between managing and maximising.
Managing is working through change –
Smoothing the sharp edges, softening the blow.
Maximising is making the most of change.
Owning it, driving it, shaping it in the best interests of all.
We approach this as maximisers, not just managers.
Managing the economy in a responsible, methodical way and making good progress.
But maximising the opportunities on the horizon too.
Each of us in the Albanese Government probably recognises, describes and defines that in different ways –
But I think it really comes down to this.
At a time of change, one goal is clear, pressing, and foundational –
To make Australia the biggest beneficiary of the shifts underway in our economy in ways that create more opportunities for more people in more parts of our country.
This is how we own the future.
We have built this whole intergenerational report on five transformative forces, shaping the future of our economy and our society.
From hydrocarbons to renewables –
From IT to AI –
From a younger population to an older one –
Which changes our industrial base and places a bigger emphasis on the care economy –
And from globalisation to fragmentation.
Consider this: 152 countries, accounting for around 93 per cent of global GDP are now covered by net‑zero commitments –
We’ve got our own ambitious set of commitments – to get to net zero by 2050 and cut emissions by 43 per cent from 2005 levels by 2030.
Dealing with climate change is a global environmental and economic imperative.
The IGR makes clear the costs that could come with rising temperatures, the impact on specific sectors like agriculture and tourism –
Plus, the vast scale of investment needed to respond –
Some additional $225 billion, to decarbonise heavy industries and transition our energy system.
These are not only risks to manage, costs to bear –
But vast industrial opportunities –
With more clean, cheap, renewable power creating cumulative comparative advantages in the new industries of the net zero economy –
Unlocking new sources of growth and leveraging our traditional strengths.
The shift from IT to the AI revolution presents similar opportunities.
As general‑purpose technologies, the impact of Artificial Intelligence and robotics will stretch across the breadth and length of our economy in powerful ways.
But if we muddle through with the wrong policy frameworks and fail to make the right investments –
If tech talent remains in short supply, fast internet is confined to our cities, our regions aren’t connected to these opportunities and the adoption of digital is limited –
Then it’s possible, if not probable, that the fourth industrial revolution will leave more people behind than it lifts up.
But if we get it right, tech can help us to maximise the big shifts in our economy –
Including the ageing of our population, as people live longer and healthier lives.
Moving from a younger to an older population is something we’ve known about for some time now –
And it’s true that this will put a strain on our Budget.
In fact, around 40 per cent of the projected increase in spending that’s outlined in the IGR is due to us getting older.
But this will come with a chance to transform our industries in the right way – the fourth big transformation in front of us.
The composition of our industrial base will be changed by energy, by technology and by demography.
Demand for critical minerals will explode, the opportunity of the century –
To mine, refine and manufacture them.
But it’s also increasingly about the care and support economy.
Over coming decades this sector is projected to almost double as a share of GDP –
Which would require its workforce to double too.
We could see this only as a potential drag on productivity –
An expense to manage.
The better way is to focus on what we can do to make sure the investments that we’re going to make –
In our workforce and in the whole infrastructure of care –
Deliver quality outcomes and quality careers and, in the words of my friend Everald Compton, “turn grey into gold”.
All of these transitions are unfolding before us in a world of geopolitical risk and fragmentation.
All over the globe, the way that countries think about their economic and trading relationships has shifted.
Everyone recognises that global trade is important, but risk, self‑sufficiency and security have tested the limits of this integration.
All this could be seen as a threat to an open, trading nation like Australia.
But again, I think we’ve got a big chance here –
To sustain our advocacy for the benefits of free and fair trade –
While working with our partners to de‑risk supply chains –
And finding those areas of alignment between our strategic and economic and national interests.
Across the board these five big shifts in our economy and society compel us to –
Make the most of the energy transformation –
Foster a digital revolution that works for, not against us –
Provide quality care for an ageing population –
Prepare our people for work in new and broadening industries –
And locate and leverage our economic interests in an uncertain world.
By meeting these responsibilities to future generations and to each‑other, we can turn compounding pressure into compounding opportunities –
To create an economy underpinned by stronger, more secure, more inclusive, more sustainable growth.
Reform principles
That’s why we’re taking methodical, principled, considered and coordinated action –
Meeting our responsibilities by:
Creating a more dynamic, productive economy –
That spreads opportunity to more people, in more places –
And elevating above the day‑to‑day cut and thrust of politics to make sure that we’re focused on achieving long‑term success.
These three principles underpin our reform blueprint –
A plan for a future where Australians are beneficiaries, not victims of the big shifts in front of us.
We see them all as essential and mutually re‑enforcing –
Recognising that a more productive economy in the 2020s and the 2030s –
Won’t come about with an approach from the 1980s.
The productivity challenge has changed and our prescriptions must too –
Through a more effective, efficient care economy –
The formation of a new, broader industrial base, built on clean energy –
The better use of data and digital –
Linking‑up opportunities for our workers –
In strong, effective, efficient markets which promote competition and dynamism.
Building a more productive and dynamic economy on these foundations –
In a vision of the future –
Where we spread opportunity, rather than narrow it –
And bring more people with us than we leave behind.
Eight reform priorities
Here, in productivity, opportunity, and policy oriented towards the future –
You see our vision for a more prosperous, inclusive nation in the years ahead.
As we deal with the pressures of the here and now.
1. Our first priority is to ease the cost‑of‑living.
The inflation fight is not yet won, and it will be our major focus until it is.
We are realistic about the next 12 months and optimistic about the future.
Because amidst all of the threats to living standards and opportunities for growth laid bare in the IGR –
Amidst the challenge and the change in front of us –
We’re acting, not just thinking.
And with the rest of my time today I want to tell you how.
2. We’re getting the budget in much better nick.
By exercising spending restraint –
By returning the majority of tax revenue upgrades to the bottom line –
By making modest but meaningful changes to our tax system –
And by finding tens of billions in savings and reprioritisations.
3. We’re transforming energy on our path to net zero.
By unlocking investments in cheaper, cleaner generation, transmission, and storage –
By decarbonising our grid, building new clean industries –
All supported by a safeguard mechanism to drive down emissions –
A sustainable finance strategy –
Investments in adaptation –
Leveraging and responding to the Inflation Reduction Act –
And with a Net Zero Authority to coordinate opportunities for workers and regions.
4. We’re building a bigger and better‑trained workforce.
You can see that in our focus on participation for all Australians – across locations and generations –
Like giving parents – and especially women – more choice and opportunity to work, with cheaper early childhood education and more parental leave –
New migration settings which work in our country’s interests, coming soon –
And our efforts to equip our people with the skills that they’ll need to flourish and prosper in the face of change –
With improved access to TAFE and University –
To life‑long learning opportunities –
Better adopting and adapting to technology –
All important parts of our Employment White Paper next month.
5. We’re broadening and deepening our industrial base.
Through a National Reconstruction Fund that is investing in projects that will diversify our economy and build up advanced manufacturing –
Through a critical minerals strategy which will help us to leverage traditional strengths into new ones, as we redefine what it means to be a resources powerhouse –
And through our comprehensive plan for the care economy – to ensure we have the people we need to deliver the care that Australians deserve.
6. We’re leveraging capital and lifting investment.
Including in areas of national priority like energy, housing, digital and defence –
Using co‑investment, tax incentives, our work with international partners, super funds, industry and through the federation, to drive capital into our economy and towards a better future.
7. We’re designing more efficient markets.
Through a competition review that will focus on boosting dynamism and competition –
Our efforts to modernise the payments system –
Improving the delivery of essential services –
And all that we’re doing to ensure that our financial market infrastructure can support the flow of funds effectively and efficiently in the years ahead.
8. And we’re reforming our economic institutions.
By renewing the RBA and refocusing the Productivity Commission –
Establishing new approaches to address entrenched and intergenerational disadvantage through place –
Introducing gender responsive budgeting –
And planning better across the Federation to address population pressures and improve liveability –
Building more well‑located homes, getting more of our young people on the property ladder, improving infrastructure, investing in skills and securing the future of the NDIS.
By doing all of this reform –
By broadening and deepening our industrial base –
Building a bigger, better trained workforce more capable of adapting to and adopting technology –
And getting capital flowing towards where it delivers the best returns and the most benefit to the nation –
We will be maximisers not just managers in the decades to come.
Shaping the future on our terms
This is our blueprint for the future.
Not just understanding the big trends and transitions but acting on them –
Turning pressures into prescriptions –
Options into opportunities –
And turning our geological, geographical and meteorological advantages into economic and geopolitical advances.
If we don’t –
The damaging impacts of climate change will ramp up –
We will fall back further from the digital frontier –
Unprepared for the pressures on the care economy –
More exposed to the whims of the world.
This is not the first time we’ve had to make choices about the kind of country that we wanted to be –
Future makers, or future takers –
But it might be the most important time.
Here, at this generational fork in the road we can shape the future on our terms.
We can turn these turbulent twenties into the right kind of defining decade.
So that in 40 years‑time, our successors will be able to look back and see that we got it right –
Like we now look back on the 1980s.
And in the spirit of mura gadi –
The Ngunnawal people’s search for the right path –
We can deliver an economy and society that allows the next generation to thrive and the ones after that.
As I said at the start:
An Australia of longer and healthier lives, powered by renewables and transformed by technology –
With care and compassion at its core, adding value and maximising opportunities in a world of churn and change.
An optimistic Australia of endless possibilities and generational responsibilities.
It’s what this IGR is about –
That’s what the referendum for a Voice is about –
It’s what the whole Albanese Government is about –
Making decisions today that will allow us to own the future –
And a future worth owning –
So that our generation and future generations can be proud.
Thanks very much.