This piece was originally published in the AFR. Click here to read.
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I want the roundtable to focus on 4 big-ticket items
The key areas where we should aim for near-term actions and longer-term commitments are regulation, tax, government spending and the energy transition.
Aug 18, 2025 2.22pm
This week’s Economic Reform Roundtable is a welcome initiative, but not an easy undertaking. Treasurer Jim Chalmers should be credited for provoking the most wide-ranging economic debate we have seen in years.
To make the most of that, it needs to both recommend tangible, short-term outcomes and build the case and momentum for longer-term reform.
There are four key areas where we should aim for that balance of near-term actions, and longer-term recommendations – regulation, tax, government spending and the energy transition.
First, regulation. The energy that is building around regulatory reform across the political spectrum is an enormous opportunity. We need to get consensus on key areas – such as federal environmental laws and housing regulation. However, to maximise the opportunity, we must address the underlying incentives and institutions that drive the regulation “hairball”.
The Productivity Commission and others have put forward some positive ideas – a stronger Office of Impact Assessment, a minister for better regulation, commitments to reduce regulation by a certain percentage each year, and greater accountability on the costs of delays in government decision-making.
This summit should endorse a range of these mechanisms now and urge government to make strong statements of expectations directed at departments and regulators, and institute transparent measures of success. Starting boldly is critical to even partly counteract the natural incentives to increase regulation.
Second, on tax, we shouldn’t pretend we can design a new tax system in an afternoon. Tax is incredibly politically sensitive but the urgency to address productivity and intergenerational inequity cannot be ignored. The most important thing the talks could achieve this week is charting a path forward on tax reform, that keeps as many options on the table, and people in the tent, as possible.
The summit could reach consensus on some of the biggest issues with our tax system and provide impetus for Treasury to undertake a sharp, goals-driven process to identify reform options. This should be done in a budget neutral way. Momentum in the community on tax reform is building, and it is time to put specific costed options out and build from there.
Third, we must confront challenges in government spending and services, especially the rapidly growing care economy. Consensus on tactical improvements in areas like aligning accreditation and registration of carers should be possible, but we need agreement on more profound directional changes.
These start with acknowledging the NDIS cannot grow at 8 per cent a year, and move to more creative questions of how to shift towards more prevention in health, how AI can improve service delivery and avoid further growth in the public sector.
Finally, climate policies must be recalibrated to minimise cost. Australia’s current approach – various subsidies, incentives, and sector-specific schemes – are moving the economy where it needs to go, but the lack of a carbon price makes the energy transition slower and more expensive than it could be.
The summit could move to first-best by agreeing on transparent carbon pricing principles across all schemes and expanding and strengthening the safeguard mechanism.
Beyond these big-ticket items, there are plenty of modest but meaningful reforms that the roundtable should aim to agree on – from better recognition of skills across jurisdictions, to fixing the superannuation performance test and RG97 that reduce investment in our most innovative companies and housing.
Equally, we must avoid overreaching with headline-chasing ideas, like an overarching AI Act, that could do more harm than good.
Critically, process matters as much as policy.
The conversations I’ve had with summit participants suggest this isn’t a stitch-up, and there is real desire to find practical ways to unlock productivity. That’s promising. Whether the roundtable fosters trust across sectors, or just entrenches old divisions, will shape what’s possible after this week.
While three days can’t deliver reform, we can build the foundation for it. Many of the most promising reforms of the past started with that foundation: open dialogue, clear goals, and broad coalitions. And many of the failures – from the minerals resource rent tax to increasing the age you can access the age-pension – collapsed because partisanship and political expediency got in the way.
We should ask ourselves: are we better off for those failures? Or did they just delay inevitable, necessary change, and set our whole country back?
We have a chance to lay the groundwork for reforms that will benefit future generations and future governments. Let’s not blow it.