It is a pleasure to be speaking today to the Business Council of Australia.
The Business Council has an important role in todays Australia.A role in shaping how the nation manages change and how we take advantage of new opportunities.
To make the most of the future, we need to think and act longterm.
So, I commend the Business Councils focus on the long-term, its focus on improving the nation for future generations.
I would particularly like to thank the CEO of the Business Council, Jennifer Westacott, for her contributions to the Tax Forum and Future Jobs Forum.
Both events, and the contributions of those who participated, remind us that the optimal public policies in the years ahead will be the product of the ideas of today.
And a meaningful appraisal of our future challenges must first be grounded in the contemporary context.
We are an economy in transition.
Our consideration of this transition often focuses on the terms of trade, the high dollar and the investment pipeline.
These are core drivers of enormous change.
But this change is a subset of larger shifts in the global economy.
Our exports to China and India - two of the worlds fastest growing economies - are double those to the United States and Europe.
The middle class in the Asia-Pacific region is expanding at an extraordinary pace adding around 1.2 billion people by 2020.
This is change we are living through, and this is not only cyclical. This is a structural change.
But in the face of change, leaders in business, politics and the community have a choice. They can try to avoid it.
They can rally against it.
Or they can position the country to take advantage of the opportunity.
This is the focus of this Government.
To build on the success of previous Labor Governments.
They reduced tariffs.
They floated the dollar.
They introduced the superannuation guarantee.
They established National Competition Policy.
Not all of these reforms were universally accepted.
Many were difficult and contested but they have all proved vital to our current and future prosperity.
These reforms exposed Australian companies to greater competition yielding gains through efficiency, more innovation and greater productivity.
To illustrate, an Australian working in 2000-01 produced over 24 per cent more for every hour work than in 1990-91.
These hard-won reforms shaped todays economy.
A modern, open and competitive Australian economy.
Australia has always done better when we have readied ourselves for the changing times rather than ignoring the change on our doorstep.
This Government has set out an economic reform agenda that puts in place the building blocks for the future.
The building blocks to boost the productive capacity of our economy.
Strong public finances.
A low carbon economy, and a clean energy future.
Record investment in skills and training to prepare our workforce for the jobs of the future.
Investment in critical infrastructure, like the NBN.
Regulatory reform to make it easier for business to get on with doing business.
These reforms involve hard work.
They will not happen overnight. And they will require determination determination from all parties to deliver them.
Today I want to focus on one of the building blocks the Governments deregulation agenda.
An effective and efficient regulatory framework is one of the foundations of a strong economy.
Which is why the Government has agreed upon a set of principles to guide our ongoing work in this area. Principles which clearly set out the expectations of our deregulation agenda, and the role it plays in our economy and society.
- The deregulation agenda should promote economic growth and job creation by increasing productivity, enhancing competitiveness and stimulating innovation.
- The deregulation agenda should adopt a risk-based approach which protects public health, community welfare and the environment.
- The deregulation agenda should ensure that unnecessary compliance and administrative cost burdens are not imposed on business and the not-for-profit sector.
- The deregulation agenda requires consultation with stakeholders to ensure that the relative costs and benefits of using regulation are considered.
They are the principles which inform the Governments approach to regulation.
They are also informing our important work in developing a future regulatory reform agenda.
Current Agenda
When we took office, the reality facing Australian business was an environment where they needed to navigate through up to eight markets.
Where a tradesperson had to go through the cumbersome process of getting registered in each State or Territory.
Where a business owner had to meet the often contradictory occupational health and safety requirements across state lines.
Where burdensome regulation stifled the growth of the local business.
The priority of the first wave of deregulation was to create a seamless national economy. To respond to the real-life experience of businesses trammelled by inconsistent state and territory regulation.
The core of this deregulation agenda is the COAGs Seamless National Economy National Partnership Agreement which was settled in November 2008.
This formalises the direction for both the Commonwealth and State Governments.
Without all jurisdictions pulling in one direction, our efforts can often be in vain.
And weve made strong progress on this front.
This is an ambitious agenda and its benefits are invaluable.
Paul McClintock from the COAG Reform Council noted that the reforms:
are about everyday businesses and consumers no longer having to comply with multiple regulatory regimeswhich is costly and frustrating.Its about streamlining regulation, which will ultimately cut down costs and improve efficiencies for those Australian businesses and consumers working across state and territory lines.
(Paul McClintock, Speech at Launch of National Partnership Agreement to Deliver a Seamless National Economy: Report on Performance 200809, 23 February 2010.)
This was an agenda developed after years of complacency.
Let me make clear the previous Coalition Government did identify the importance of regulation reform.
They did commit to cutting red tape for small business by 50 per cent in their first term. A claim repeated now in opposition.
They did respond to the Bell report in 1997 and nearly 10 years later, they did commission the Banks review. But the Banks review recommended many of the same recommendations that were included in the Bell report.
A reminder that promises to cut red tape are easily made but often not matched by delivery.
This reform agenda has never been advanced through slogans.
Thats why we have worked hard not to repeat the all talk no action which preceded us.
Our seamless national economy agenda is about reducing costs for business in complying with unnecessary and inconsistent regulation across jurisdictions.
An agenda that enhances Australias longer-term growth, improving workforce participation and overall labour mobility.
An agenda that expands Australias productive capacity over the medium-term through competition reform, enabling stronger economic growth.
To date, over half of the deregulation reforms are complete with the remainder due between now and the end of 2012.
Where other Governments have failed, our Government is delivering ahead of schedule.
The benefits from these reforms are significant.
As an indication, just 10 of the 27 deregulation priorities are estimated to provide at least $3.5 billion in benefits each year, with a little over half being returned to business when complete.
These are worthwhile reforms.
Standard Business Reporting is up and running.
Business can now meet many of their reporting requirement through standard business reporting - BAS statements, Tax File Number declarations, PAYG payment summaries, Company Financial Statements, and Payroll Tax returns.
Once fully implemented, it is expected that more than one million businesses will be able to report through Standard Business Reporting.
From next year, we will have a National Business Names Registration System.
Businesses will only have to pay one fee of around $70 for three years to register their business name nationally, rather than in every State and Territory in which they operate.
To put just this reform into perspective and to demonstrate the advantage it has to businesses, in some states the fee is currently as high $255 for registration.
From next year, we will have a National Construction Code that consolidates building and plumbing regulations into one code, delivering benefits to the industry of at least $460 million each year.
We are also reforming Occupational Health and Safety laws.
This reform is expected to return around $250 million in national net benefit. In addition, the potential productivity benefits are in the order of $1.5 to $2 billion each year.
We are delivering on national transport regulators for heavy vehicles, rail and maritime, reforms worth up to $30billion to the national economy over 20 years for the heavy vehicle reforms alone.
Work is well underway to create a national system to allow seamless movement of tradespeople between states and territories. This reform will assist in addressing the skills shortages emerging across the economy.
For the first time, we now have a national consumer and product safety law.
Replacing 20 different and overlapping Acts across Australia, this major micro-economic reform is estimated to yield national benefits of up to $4.5 billion per annum.
Weve learnt a number of lessons in the work to date. One of the most critical is this. Delivering reforms requires a concerted effort by governments and by business.
Business rightly expects the Commonwealth to work hard to deliver, but they also need to be pressing the States and Territories to fulfil their obligations on time.
Reform needs champions and champions sometimes need encouragement.
In a Federation such as ours, regulatory reform requires not just Commonwealth action, but action by all States and Territories.
Maintaining the enthusiasm for reform across all levels of government is not always easy.
In my discussions with business, a variety of ideas have been put forward on this front.
One of these is a pre COAG Business forum; a concept floated by the NSW Business Chamber.
This would involve senior business leaders would coming together prior to COAG meetings to identify key reform priorities.
It is a proposition that has real merit.
This is just one idea that can assist in business playing a bigger role in the reform process.
Future Agenda
While it is clear that the current Seamless National Economy agenda will deliver benefits, there is always more to be done.
But we need to be careful where we focus our efforts.
We need to keep the momentum going and look to what the next set of regulatory reforms should be.
In developing the next agenda, we are working on reform options for COAG and the Commonwealths own agenda.
At the COAG level, we were given a mandate earlier this year by First Ministers to develop options for a second wave of regulatory reforms.
A set of regulatory reforms that helps us further our common goal of a seamless national economy and build on the progress to date.
At the most recent COAG meeting, the first area of future regulatory reform has been agreed national environmental regulation.
There is need for major reform of environmental regulation across all levels of government to reduce regulatory burden and duplication for business.
Reforms that will make it easier for Australia to cope with the investment pipeline that is already here. This is especially important for major infrastructure and resource projects.
Governments are already moving to make these reforms happen.
We are also looking at other areas of reform.
Reforms to further enhance workforce mobility and participation to address emerging skills shortages.
Reforms to improve the competitiveness of sectors that may not be benefiting directly for the current resources boom.
Measures to ensure that the benefits of national reform are maintained.
We are currently in the process of consulting with you on the next wave of reforms.
The Government is doing its bit, through the COAG regulatory reform agenda, but also through other means.
The Government is also developing the Commonwealth own agenda.
We are working on cutting red tape at the Commonwealth level, to make it easier for business and not-for-profits to interact with the Government.
We are working to cut regulation in the aged care and disability sectors.
We are working to review and develop reforms to chemical regulation to reduce compliance costs for the chemicals industry, a key part of our manufacturing sector, whilst protecting health and safety.
With the Attorney-General, I am working to consolidate Commonwealth anti-discrimination legislation.
I am looking at the Commonwealths procurement practices to address any barriers to small business participating in our procurement processes.
And I have asked my Department to undertake a review of smaller regulators across the Commonwealth Government, to identify further opportunities for reform across Government.
Conclusion
It is no secret that we have come through a period of declining productivity.
We cant turn around the long term structural decline in productivity growth the previous decade with just a wave of a hand.
Boosting the productive capacity of our economy is important for the long-term prosperity of the nation.
Obviously, having a robust regulatory system in place is key to achieving that goal.
We all agree that deregulation is an important part of achieving our common goal of boosting Australias productivity.
And we all agree that we need an economy that makes it easier for business to do business.
But the Federal Government cannot do this alone.
Business leaders have a responsibility to help position Australia for the change that lies ahead.
Deregulation is one of the building blocks preparing Australia for the future.
Lets work together to deliver on current reforms.
Lets work together on developing a next round of reform for the future agenda.
Lets work together to maintain the political will for reform across our Federation.
Thank you.
ENDS
