Jim Chalmers:
Thanks, everyone. I wanted to start where I finished the meeting a few minutes ago and say this: it’s a real privilege to govern or help govern a country like ours at a time of such rapid and consequential change. And at the front of all of our minds around that Cabinet room table, not just over the last 3 days, but every day, is really the magnitude of the opportunity that we have to turn our recent momentum in the economy into lasting and enduring progress. The best way to sustain and grow living standards over time is to make our economy more productive, to make it more resilient, and also to make sure that our budget is more sustainable. And these were the tasks that we set some terrific people who gave us their expertise and their experience over the course of the last few days.
For all of us, higher living standards is the holy grail, and a more productive economy is how we deliver it. And in every part of every session, the working people of this country, the community more broadly, was front and centre. Because we know that the whole purpose of economic reform is to deliver for the people who send us here to work so hard on their behalf. I wanted to thank a couple of dozen people in the core group, another couple of dozen people who joined us for specific sessions.
I am so grateful for the way that they approached the task. The spirit with which they approached the task. The way they looked for consensus and compromise. The way that they were constructive. The way they took seriously the guiderails to make their ideas in the national interest and specific and affordable, and to also try and build agreement across the group and not just with the government. I also wanted to acknowledge that they know, and we know, that a lot of the hard work begins now. The hard work doesn’t end at the end of the 3 days, nor did it begin at the beginning of the 3 days. But we’ve got a lot of work to do together.
Now as we do that work, I want to assure my Cabinet colleagues, the government more broadly, that in this government, Cabinet Ministers are front and centre. And all of the work that we propose to do, we propose to do together. We don’t propose to cut across the important work that ministers do and that the government does more broadly. And so there are some areas I’ll run you through in a moment where it requires more work, whether jointly with ministers or in their own portfolios and I want to be very respectful of that, as the group was respectful of that. Nobody in that room considered themselves to be a replacement for a Cabinet Minister, but to inform the work of Cabinet Ministers and their deliberations. I want to make that really clear.
There was 29 hours of discussion, in the end. There was, by our count, something like 327 different contributions made over the course of those 3 days. People came with their ideas, they came with a lot of goodwill, a lot of expertise, a lot of experience, and they provided their views to us in very generous ways. And that’s why I’m so grateful. There were clear and broad areas of consensus. Probably more than I was anticipating in the breadth and depth of the views that people shared, and where those views connected. Even from people representing different parts of our economy, different parts of our country, representing the various constituency groups assembled around the Cabinet table.
What I wanted to do was to give you a sense, first of all, on what I think are 10 pretty clear areas of consensus, which helped set some reform directions for the government, for the Cabinet and for me and my own Treasury portfolio. Ten directions, reform directions. Then there’s a category of work where we think we can move relatively quickly, respectful of ministers, to see where we can act with some urgency. There’s probably about 10 of those. And then there’s a heap of extra work that the group agreed to give us a hand with, which will help us determine which of the ideas they put forward. We tracked all of the ideas. We’ll work through them in a methodical and a considered way. And so the list that I’m about to give you, or the 3 lists, are not comprehensive in terms of what was raised with us. These are the 3 categories that I ran the group through that I said there was some appetite for the government to do that work, whether urgently or on a longer time frame, and consistent with the 10 reform directions.
And so the 10 reform directions were, first of all, progress towards a single national market, which is how we improve the federation. Modernise the federation. The second one is about simplifying trade and reforming tariffs. The third one was better regulation and how we cut the clutter when it comes to reg. The fourth one was speeding up approvals in national priority areas. The fifth one was building more homes, more quickly. The sixth one was how we make artificial intelligence a national priority for Australia. Seven was attracting capital and deploying investment. Eight was building a skilled and adaptable workforce. Nine was a better tax system. And 10 was modernising government services.
Now within those areas, and we’ve been able to have discussions with ministerial colleagues about some areas where we can act with some urgency, where we can try and capitalize on this momentum, which was set by the group in the search of quick wins. I want to run you through those.
First of all, I’m going to work with Don Farrell to abolish more nuisance tariffs. I’ve agreed with the relevant groups represented in the room, we’ll do that in a consultative way. But I would like to knock off hundreds more nuisance tariffs. I’ll do that work in conjunction with Don Farrell and others and in consultation.
Secondly, we’ve asked Clare O’Neil to see where we can reduce complexity and red tape in the National Construction Code. To do that in a balanced way which takes into consideration some of the concerns which were raised. You know that this was raised with us in the lead up to the roundtable as well. And so we were able to do some work. We’ve asked Clare to do that work relatively swiftly.
The next one is to accelerate the EPBC legislation that Murray Watt is doing a power of work on. Some great work that Murray is doing. We’ve asked him to accelerate that, in line with the principles of the Samuel review: stronger standards, faster approvals, more transparency and integrity. And I hope that Murray will have more to say to you about that before long.
We’ve also got a backlog of environmental approvals for new homes, most likely in the tens of thousands. And so we’ve asked Murray to work with Katy, with Clare sorry, to see what we can do to knock off that backlog, or as many of that backlog as we can. And ideally, Clare will have and Murray will have more to say about that before long as well.
Katy Gallagher and I wrote to all of the major regulators, as you know, seeking specific ideas on better regulation, de‑reg, cutting red tape, cutting compliance costs and better regulation, working out where regulation is not serving its intended purpose, and to work out what action we can take there. We have literally hundreds of ideas from the regulators, which is a very good thing. We are going to check as swiftly as we can and then ideally release those letters to you and to the public, in the hope that that generates a public debate about how many of these hundreds of ideas we can pick up and run with.
Related to that, we will ask the Council of Financial Regulators to pull together the financial regulators part of that to try and coordinate that work and all those ideas provided to us by the financial regulators, and also to try and elevate the ambition in those ideas. There’s an important role for the Council of Financial Regulators.
Katy Gallagher will introduce a regulatory reform bill this year to progress what is the ‘tell us once’ principle, which is really about not asking people to supply the same information over and over again for different purposes. Katy has already begun some work on that, we have intended to legislate that, but we will accelerate that work on ‘tell us once’.
Similarly, when it comes to accelerating her work in the APS part of artificial intelligence, releasing an APS AI plan as well.
Related, Tim Ayres is going to accelerate his work on the broader National AI Capability Plan. We got some really good inputs into that in the room, including how we work out those national interest principles on data centres, with all the resourcing questions that that invites. And so, Tim was in the room for some of that feedback, and that will help him finish the Capability Plan.
I’ve got the Investor Front Door pilot starting next month, and we got some very important consensus around how we make that work most effectively.
And then finally, there was a lot of support in the room for road user charging. There wasn’t a final model settled, but there was a lot of conceptual support for road user charging, and we committed to the group that Daniel Mookhey and I would work with Catherine King and other ministers to work through a state’s options paper when I meet with the state and territory treasurers on the fifth of September.
So those are all of the areas where we identified relatively swift work, where there’s a sense of urgency or where we can accelerate some important work which is underway.
The last area is around further work. And I think you all appreciate, certainly we’ve said publicly for a couple of weeks now, that the meeting wasn’t to cross every T and dot every I. That inevitably there’d be work to do with ministers, there’d be work to do in a collaborative way with people at the roundtable. And there is more of this than I was anticipating. Certainly, more appetite for reform in more areas than what we anticipated going into the room. And so I’ll try and run through it as quickly as I can.
First of all, beyond the tariff piece in trade, people have been trying to crack this simplified trading system for a long time. It involves a bunch of ministers, Farrell, Burke, Collins and others. And so we’ve got more work to do on simplifying trade, and as part of that, considering the Australian Trusted Trader Program in, I think, Tony’s portfolio, but with a lot of Don input.
On better regulation more work to do on the ‘tell us once’ principle, including in the financial sector, and Danny Mulino will help us on that front. Deep dives for priority sectors for better regulation, working out how we deal with the thickest regulation. More work on tech tools to reduce compliance costs. I’m going to do some more work on whether, through Statements of Expectations or in other ways, that I can encourage a more effective balance between growth and risk when it comes to our regulators. A lot of appetite for kind of redrawing that balance. The Productivity Commission is going to give us some options on the best way to measure progress on better regulation around the world. People have come up with all sorts of targets and benchmarking. We want to make sure that we get that right.
On the single national market, a heap of work commissioned in the lead up to and after that state treasurer’s meeting on the fifth of September. We are going to expand National Competition Policy. We’re going to focus on recognizing international standards, harmonising state and territory standards, expanding national occupational licensing, speeding up project approvals, the road user charging piece I mentioned before, and also the heavy vehicle regulation reforms that Catherine and others have been working on. So National Competition Policy is going to be a really important part of the work that happens from here.
On approvals, obviously, more work to do with the states and territories on speeding up decisions, including how we best make use of pre‑approval, conditional pre‑approval, and the planning in advance part of seeing more housing and other kinds of projects underway quicker.
It’s clear that the work that I’ve done on the Foreign Investment Review Board process is making progress. But people in the room want to see more progress, faster, non‑controversial FIRB approvals, and so I undertook to do some more work on that. I’m proud of what we’ve done so far, but if there’s more that we can do, I’m going to have a look at doing it.
In the single front door, we’re going to do some consultation on whether some kind of coordinator general function works to try and speed up approvals for big nation changing projects to try and get these big projects through hoops quicker and more efficiently in the national interest.
On housing, there’s more work to do on prefab and modular and modern methods of construction. A lot of appetite in the room for prefab homes as a way of being more productive in housing and construction and also dealing with costs. And obviously, the states have got some more work to do on planning, zoning and approvals.
On capital and investment, as some of you foreshadowed out of the meeting, we are going to have another look at the super performance test. I want to make it perfectly clear that we are not talking about abolishing the performance test, and we are not talking about in any way interfering with the sole purpose of super funds, which is to deliver the maximum returns that they can for the members. I want to be perfectly clear about that. But there is interest, from a government point of view and certainly around the table for us to make sure that there are no unnecessary obstacles or impediments to institutional investors like super investing in areas like housing and other areas where there’s clearly a national need. We said we’d have another look at the Special Investment Vehicles to make sure that they are doing the job that we need them to do. A number of people raised VC and other parts of the economy and SIVs might be a way that we can get closer to an ideal version of that.
On artificial intelligence, there was a very heartening discussion about AI, and not because everybody came to a perfect agreement on every element of AI regulation. But because we got a bit closer, and Michelle Rowland has got a process on the copyright part of the question, and Michelle does that work, and we’re respectful of that. But in the room, by sharing understandings in this question, people got a little bit closer together. Not a unanimous view yet, but a little bit closer together. And I see that as a very good thing. In terms of the overarching legislative question – one AI Act or using existing regulation – we’re going to do the work on that, the gap analysis of that to see whether we can meet our objectives with existing legislation, or whether it requires one overarching bill.
On skills, there was a lot of appetite to do more work on Jobs and Skills councils. Obviously, that’s in the Jason and Andrew Giles part of the shop, and so I will talk to them about that. A heap of appetite. How do we better recognize qualifications, whether they be international or skills in the domestic setting. A lot of appetite for that. Joining up the tertiary system, looking again at TAFE self‑accreditation. These are all areas that other colleagues manage, respectful of that. Greater access to credit transfer, the points test was raised in the context of migrants, how we attract the highest skilled workers. And also broad agreement around the recommendations, I think 5 to 10 of the JSA AI capability study, that was really where the agreement between business groups and the unions came together.
On modernizing government services, obviously, always ongoing work when it comes to the structural pressures on the budget. I shout out that terrific speech that Mark Butler gave yesterday, which gives you a sense of what we’re up against and what we’re trying to do, and how we’re trying to include people in the journey when it comes to those big structural issues in the budget. Katy’s going to see what else can be done to modernise procurement, better use data, to improve government services, including AI, maintaining a human decision‑making element. And then, as well, Katy has in her hands a review of the Data Act, and with an eye to reforming the Data Act. And a lot of the conversation around the table was about how Katy best go about that important task.
On tax, which I’ve left till last, because that was where the meeting concluded. We had a few hours of very welcome conversation and debate about the future of the tax system. And where we landed was that there was a lot of support for trying to put a structure around the work that we will now do as a government in a consultative way, collaborative way, to really try and address 3 objectives in the tax system.
The first one is about a fair go for working people and including in intergenerational equity terms. That’s the first category. The second one was about an affordable, responsible way to incentivise business investment, recognising the capital deepening challenge that we have in the economy, and what that means for productivity and for growth. And then, thirdly, how we make the system simpler, more sustainable, so that we can fund the services that people need, particularly in the context of the big shifts in our community, including aging and other pressures as well.
Obviously, there’s a whole bunch of other work that the government is engaged in, where the reform roundtable provided some helpful momentum or insight. This is not an exclusive list, but we’ve got the strategic examination of R&D underway, the digital ID process, the various parts of the gas market review that Madeleine and Chris are doing, the net zero plan and other elements as well. And so I’m happy to take a couple of your questions. I know that you’ve got to file soon. I just really want to say that there were very heartening signs of very welcome areas of consensus. That was the whole point of the last 3 days. And I finished those 3 days more optimistic about the progress that we can make together than I was at the start, and that’s because people approached in the right spirit, and I appreciate that.
We’ll start from this side. We’re going to go Tom, then Clare, then Katina, then Matt.
Journalist:
Treasurer, you said that the EPBC process will be sped up. What’s the new timeline? I think the old one was 18 months?
Halmers:
Murray Watt’s going to have more to say about that soon. We’ve had some engagement with Murray, and he was in the room for a big part of the discussion, but I don’t want to preempt the work that we’ve asked him to do. We’ve asked him to accelerate it. He’s made a heap of progress and it feels like that hard work that he’s put into it is bearing fruit. But I don’t want to cut across anything he might want to tell you, in the next few days. He’s making progress, that’s a good thing, and we’ve asked him to be swift.
Clare.
Journalist:
Treasurer, how does the work of the last 3 days differentiate from what you would do in a normal budget process, or that any of the ministers that you listed off would do in their own portfolio work? There was expectation management coming into this that there wouldn’t be some big reform out of it. That seems to have been the case in terms of the volume and quantity of changes you’re looking at exploring. In your assessment of these last 3 days do you think it was worth it?
Chalmers:
Absolutely. And as I said a moment ago, I finished the 3 days more optimistic than I was at the start. And that’s because we were able to make quite substantial progress in a number of areas. Now, if your question is how does this fit in with the character of the government, this is a consultative government, collaborative. We work through issues in a methodical, considered, consultative way. And so the last 3 days have been of that nature. But to get people of this expertise and this experience around the table, making the sorts of generous contributions that they made with the level of candor that they adopted, I think, has been an incredibly useful thing. And it augurs well for the progress that we can make together.
Katina.
Journalist:
In terms of the road user charges. So you’re putting some options together in the next 2 weeks. That’s a very tight time frame. Have you already been working up those when you look at what some of the states are doing? And just quickly, sorry, you said you were putting, you agreed to put in place a structure around what you’re doing on tax in those 3 areas. You didn’t actually say what that structure was. Is there a tax review? What’s happening now?
Chalmers:
First of all, on road user charging, there was more than the usual amount of consensus in a conceptual way around road user charging. A lot of reform appetite in that area, which is welcome. I also wanted to acknowledge the very influential role that Daniel Mookhey played in the room, representing the state and territory treasurers. He was terrific. And he and I both took a lot of guidance for that meeting that we’re convening on the fifth of September. The states are putting together an options paper. And to give you a sense of the considerations that people in the room were grappling with, and I suspect the states are grappling with too, is about, obviously the substance of that regime, but also the timing and sequencing of it. Whether that’s best done in pieces over time or a swifter model. And there wasn’t unanimity on that. I suspect there’s probably not unanimity around that in the states and territories either, but we will consider that options paper when we meet in a couple of weeks’ time. Now on the tax stuff there was a view in the room that we not commission another lengthy, public, external tax review. And probably not everybody started with that view but I think the way that the discussion unfolded was that the best thing that they can do is to structure their involvement in our work. They asked us and we undertook to them that we would consider tax reforms in those 3 areas. There are hundreds of different changes you can make to the tax system, some of them obviously unpalatable to our government or to governments broadly but what they wanted to do was to give us the guidance that they will help us in those 3 areas to do the work that we need to do, to inform future budgets.
We’re going to go to Matt, then David.
Journalist:
So Treasurer, lots of announcements in here. I think it’s fair to say that it’s not the sort of big ticket reform of the Hawke/Keating style era which some people might say is sort of needed to get Australia back up to it’s productivity levels it needs. I spoke with some of the more prominent handpicked people in your roundtable just afterwards, and I asked them, is this enough to get Australia’s productivity where it should be? And they said, I wouldn’t go as far as saying that. Do you think all this stuff is going to get you anywhere near the 1.2 per cent productivity growth that your Treasury targets?
Chalmers:
Well, first of all, I don’t know how you differentiate prominent and non‑prominent in that room. Everyone made a helpful contribution, so I’m not going to share your categorisation. When it comes to productivity, we have said for some time, Danielle Wood has said more eloquently than I, that productivity, making our economy more productive, involves us to make many changes at once. And I have said in my way, that if there was one switch that we would flick to make our economy instantly more productive, somebody would have flicked it already. But this is hard, long‑term work. We’ve had a productivity challenge in our economy for decades, as you know, and it will take time to turn around. I’ve tried to be upfront that the best way to turn that around is to do that together. The best way to turn that around is to act on multiple fronts at once, and that’s what we’re doing.
David, then Phil.
Journalist:
Just back on tax, just to be clear about where it goes from here. No external review. But the structure to involve those who are in the room. Does that mean Treasury will look at options on tax and stay in touch with those in the room through the process?
Chalmers:
Well, first of all, this is primarily a conversation for the government to have about the best way forward. What happened in the tax discussion was in ways that you would expect and anticipate, there were a lot of ideas raised, some of them not consistent with each other. Even if you wanted to, you couldn’t do everything that people pitched up in the room. I think people understand that. And really the spirit in the room was to try and help government make the kind of tax reforms that would be helpful, whether to workers in an intergenerational sense, business investment, sustainability, simplicity. And so we undertook to be as respectful as we could to the contributions that people made, to structure our work in those 3 areas, and to work out the best way to involve them, without necessarily opening up another 18 months of very public tax review, when a lot of the issues are pretty well known.
Phil, then we’ll go Jacob, then Shane and then Paul, then we’re probably done.
Journalist:
Just in the context of both yours and the Prime Minister’s comments on tax before the roundtable. Is it your intention or your commitment that whatever comes out of the next step, the structure, that will be taken to the election or preserve the right to do something?
Chalmers:
It’s a matter for Cabinet primarily, but there’s an example of something that we would like to advance sooner, and that’s road user charging, we’ve been upfront about that. But this is why you can’t apply a blanket rule, in my view, because there’s some work underway. There’s obviously the multinational tax environment is changing quickly, and so it’s not possible to put a kind of a blanket explanation on all of it, and it’s a matter for Cabinet. What we committed to the people around the room was that we would do the work in those 3 areas. We’d consult them where we could, and we’d do that without a big public, formal tax review.
Jacob.
Journalist:
Phil’s question there, you talked about the sort of surprising consensus support for something like road user charging. Are you taking a bit of a mandate from that group of people you put together as being reflective of a broader sort of sense in the community for these changes? And just a second one on the road user charges. How expansive, are you talking about something specific to one category of vehicle, or across the board?
Chalmers:
Well, first of all, I wouldn’t use the word that you’ve used in terms of the momentum and progress and imprimatur that we drew from the room, the mandate. In a democratic system, a mandate comes from the 27 million people that we work for. We’re very conscious of that, and almost every contribution on the first day recognised that everyone in the room had bigger responsibilities to people outside the room, so I answer your question that way.
In terms of road user charging, the model is not determined, but the key considerations are what’s in and out, and whether that’s sequenced or not, and over how long a time period. And Treasurer Mookhey was very informed and very constructive on this question, and really right around the table, people had a view that this is an idea whose time has come, and so we will do that work. It does, I think, encourage us down that path but as you know, this is something we’ve been working on for a little while as well. We’ve got some good views, some good input. We’ll work with the states and territories to try and work out the best model and the best timing.
We’ll go to, did I say Shane next? And then Paul and I think I said we’re done.
Journalist:
Ken Henry has talked about the tax system being an act of intergenerational bastardry. Bob Breunig put out research talking about the intergenerational contract being broken. Are you comfortable with the current tax setting in terms of intergenerational equity. The fact that you’re looking at it, does that mean there has to be change to make it fairer?
Chalmers:
I think our tax system is imperfect, and one of its most troubling imperfections is best seen through an intergenerational lens. And what I mean by that, really almost everybody around the table had a similar view, which is we take our responsibilities to the coming generations seriously. It’s one of our motivations for budget repair and getting the Liberal debt down. It’s one of our motivations for investing in housing and skills, doing something meaningful about climate change. But it also has implications for the tax system. And if there was one kind of defining element of the contributions that people made around the table, it was intergenerational, and Ken was part of that, Sally McManus, Bob, Allegra Spender, I could probably name almost everyone made a contribution on this front. We recognise that we as people of influence with this opportunity, have responsibilities in lots of ways, but especially intergenerational responsibilities, and we take them very seriously.
Paul, let’s finish up.
Journalist:
I think you’ve answered this in different ways.
Chalmers:
Thanks very much.
Journalist:
Does having this conversation publicly and acknowledging what you’ve just acknowledged about the tax system without committing to going into election or a certain budget, does it inspire, does it create a more powerful mandate for you to tackle some of those big issues? Do you feel that coming out of the room?
Chalmers:
Again, I wouldn’t use the word that you and Jake have used, because our opportunity springs from the people who elect us and who send us here to work so hard on their behalf. But I’m genuine when I say at the end of that 3 days, I looked around the table and I saw people, big achievers in their own areas, representing workers, business CEOs, academics, economists, public servants and others and I drew great strength and confidence from their contributions, not because they had some kind of faux camaraderie, but because they take the challenge so seriously.
And if there’s one way to understand how this Albanese government rolls from the Prime Minister all the way down, is we genuinely believe in our hearts that the best kind of progress that we make is the progress we make together. And there is a role for leadership, and we are providing it. There is a role for expertise, and that’s being provided. There is a role for including more people in the big economic questions and challenges and opportunities of our time, and that gives me an opportunity to finish exactly where I started.
What an unbelievable privilege when you think about the pace of change, accelerating change, how consequential it is. Our opportunities and our risks are finely balanced in our economy, in our society and in the world, and we believe that we give ourselves a much better chance of being the best in the world at confronting those challenges in an upfront way, in an honest way and in a decisive way, if we include more people in that task. That’s what the last 3 days was all about, and that’s why I appreciate it so much.
Thank you.