ESA National Economic Panel Polls


 

About

Polls

Panellists

Got an Idea?

One issue matters more to top economists than any other this election: climate change





Wes Mountain/The Conversation, CC BY-ND

Peter Martin, Crawford School of Public Policy, Australian National University

Offered a menu of issues to choose from as the most important in the May 21 election, Australia’s top economists have overwhelmingly zeroed in on one.

Three quarters of the 50 top economists surveyed by The Conversation and the Economic Society of Australia have nominated “climate and the environment” as the most important issue for the incoming government and the most important in the election.

The 74% who nominated climate and the environment is more than twice the proportion that nominated the four substantial runners up: housing availability and affordability, health, tax reform, and education.



None of the 50 surveyed nominated “lower taxes” as important for the election or the incoming government, and only 8% nominated support for business.

The economists chosen for the survey are recognised as leaders in fields including economic modelling and public policy. Among them are former IMF, Treasury and OECD officials, and a former member of the Reserve Bank board.

Many noted that their priorities were at odds with those of both major parties.

Guyonne Kalb of The University of Melbourne observed that Australia was especially vulnerable to climate disasters, and that the population seemed to recognise this more than the government. Being the last nation to use outdated technologies was “never wise if it can be avoided”.

 

Young Economist of the Year Stefanie Schurer said Australia had fallen so far behind the richer countries on measures to reach net zero it ranked “dead last” according to the Climate Council. It was not only embarrassing, but “incredibly shortsighted” given Australia’s exposure to extreme weather events.

Flavio Menezes of The University of Queensland said the needed transition was massive. To achieve net-zero by 2050 (a target accepted by both sides of politics) Australia would need an 800% increase in large-scale wind, solar and hydro generation, as well as a corresponding increase in the transmission capacity.

The current government’s motto of technology not taxes was “an empty slogan”. Much of the needed spending would have to be funded by taxes.

A carbon tax would help

The University of Queensland’s John Quiggin described the campaign as the most depressing he had seen in more than 50 years of paying attention. Neither major party was offering anything substantive.

Several participants noted that a carbon price (or tax) of the kind Australia had between 2012 and 2014 would provide a permanent incentive for every sector of the economy to find new ways to cut emissions, but was “not on the table”.

Consulting economist Rana Roy said Australia actually had several types of carbon price in place, but their rates varied widely, with emissions in some sectors untaxed, while emissions in other sectors (such as petrol) were overtaxed.

 

The third of the economists surveyed who nominated tax reform as an important issue said it would be needed to deal with the other issues identified as important: housing affordability, health, and education.

Saul Eslake said in an ideal world both sides of politics should be having an intelligent conversation about the least damaging ways of raising the extra one to two percentage points of GDP in tax revenue that will be needed to fund priorities including aged care and the national disability insurance scheme.

Tax reform would help

The University of Melbourne’s Kevin Davis said next year’s planned stage three tax cuts directed at higher earners (and costed by the Parliamentary Budget Office at $76.2 billion over four years) should be scrapped on equity grounds alone.

Superannuation tax should also be reformed, and capital gains tax concessions reduced or axed. The “massive” tax concessions offered to home buyers and buyers of investment properties were among the chief reasons for high prices.

Curtin University’s Rachel Ong ViforJ said changes that moved tax away rewarding the ownership of non-productive assets toward rewarding work would be needed to address the intergenerational transmission of debt.

Higher roductivity would help

The University of Sydney’s Nigel Stapledon said neither side of politics seemed focused on the emerging risk of 1970s and 1980s-style inflation.

The idea that the government could drive real wages growth without productivity improvements and not feed inflation was dodgy economics and risky policy.

Melbourne University’s John Freebairn said productivity growth had been below world’s best practice for a decade, making it hard to lift incomes and collect tax.

 

Tax reform itself could raise more tax by boosting productivity and cutting inequality, as could better regulations and less wasteful government spending.

Former OECD official Adrian Blundell-Wignall said Australia didn’t have a plan that offered less dependence on digging holes. Research and development and a highly educated population were the keys to driving sustainable growth.

But there’s little optimism

None of the 50 members of the panel was optimistic about either side of politics offering what was needed, at least during the campaign.

Eslake (a Tasmanian) said he was more likely to “tread in thylacine-poo on my front lawn of a morning” than to see the intelligent conversations that were needed between now and voting day.


Individual responses:

The Conversation

Peter Martin, Visiting Fellow, Crawford School of Public Policy, Australian National University

This article is republished from The Conversation under a Creative Commons license. Read the original article.


Responses (998)


 

Peter Abelson

.

Prioritising government actions is principally about identifying and declaring social priorities. These are essentially personal value judgements rather than technical economic questions. Of course these objectives need to be economically achievable at acceptable costs. In our affluent high wealth society, more should and can be done for the less well-off and other less fortunate members of our society, including refugees, and for the climate well-being of the world.


 

Nicole Black

.

Health: As the country recovers from the height of the COVID-19 pandemic, there are many health system issues, which left unchecked will lead to worse health outcomes, particularly among our most disadvantaged. Poor health reduces productivity and impacts society through welfare and health care costs. High out-of-pocket costs for seeing specialists, including paediatricians, psychologists and allied health specialists makes needed health care unaffordable for many Australians. Reductions in medical check-ups due to the pandemic have led to later diagnoses and treatment of conditions such as cancer, diabetes and mental illness. Ensuring timely and affordable access to primary and specialist care will not only improve health outcomes of individuals, but also help reduce the burden on costly emergency department and hospital care. Education: Greater investment in education is needed to ensure Australia remains globally competitive as an exporter of education and for our human capital. Improved access to quality early childhood education and child care are especially needed, more than subsidies for childcare, there should be a focus on workforce training and wages. This will allow parents of young children to increase participation in the labour market, and give all children the opportunity to benefit from early social and cognitive skill development. Social support: Economic disadvantage is tied to many health problems and social issues. Longer term solutions to address poverty, including raising income support, are needed, especially for single parent families. Climate and environment will undoubtedly be important for the incoming government, but unfortunately pricing carbon does not appear to be on the table.


 

Harry Bloch

.

Health and education are fundamental to having a productive economy. Not all families are in a position to make adequate provision for the health and education of themselves and their children, so governments must act if society is to function properly. The same argument extends to aged care, housing and social support in general, but without such direct links to productivity. Recent fires and extreme weather events demonstrate the importance of limiting climate change if Australia is to avoid catastrophe becoming a regular feature of everyday life. government support and coordination enhances the effectiveness of individual actions on climate change.


 

Adrian Blundell-Wignall

.

Australia doesn't have a plan for the future that will require less dependence on digging holes, a greater need for self sufficiency in key sectors and a need to deal with climate change that has been and will continue to affect Australia more than other countries. Productivity from a highly educated population and research and development are key. Dealing with debt as interest rates rise will require strong sustainable growth. China and Russia are a threat to our democracy so defense spending will remain important.


 

Lisa Cameron

.

Choosing just three issues is difficult as there has been such a lack of pro-active policy in this and the previous government that so many areas are in need of repair. Housing availability and affordability affects most Australians and is a concern across generations as parents worry about their children's futures. The public health system is under extreme duress. Aged care isn't on the list but would be on mine. As the carer of an elderly parent, I have witnessed first-hand how the system is crazily complicated, inefficient and potentially exploitative. The education system is also in need of attention. Tax reform is essential so that the government has the resources (collected in an equitable manner) needed to address all these issues.


 

Lin Crase

.

On tax: governments have largely kicked issues related to tax down the road for years. Accordingly, we have a tax system that poorly aligns with the way income and wealth are currently generated. The (albeit mostly justified) increase in spending and debt make the arguments for tax reform even more compelling. On climate and environment: Despite recent shifts in rhetoric, the economic status of federal environmental programs is poor at best. Lost and misplaced opportunities on climate are obvious to most. The appalling waste and ineffectiveness of the Murray-Darlin Basin Plan is less obvious because it's been raining lately, but will plague society for years to come.


 

Kevin Davis

.

Tax reform is needed to remove distortions to investment and output decisions and to improve equity and to grow the tax base for eventually reducing the budget deficit. But it will be difficult to implement sensible changes and almost the kiss of death to promote such things in electioneering. Planned cuts to higher personal income tax rates should be scrapped on equity grounds. Superannuation tax arrangements should be altered - change the 15% rate to a rebate of 15% on the individual's personal tax rate, and impose tax on super earnings in retirement. Recognise that dividend imputation and low/zero tax rates and rebates for super funds/charities as major equity investors means that the ultimate tax revenue from corporate income is cannibalised. Extend GST to banks - it is possible to do (maybe imperfectly, but better than excluding them). Reduce/remove capital gains tax concessions etc. Replace state stamp duties with annual property tax. Consider wealth/inheritance taxes. The list of possible improvements is vast. The housing crisis is real and an important social problem. Our tax system which gives massive tax concessions to investment in owner-occupier and investment properties is one source of willingness to pay high prices, and inflating the overall level of house prices and rents. But any attempt to change these things and depress house prices would lead to major problems for relatively recent purchasers! Supply is also important, and more government/public housing is warranted. Making a sensible national contribution to reducing global climate change via carbon emissions reduction (carbon tax etc) and other measures to reduce environmental degradation should not be an issue which divides political parties, but...


 

Brian Dollery

.

Immigration is an explosive question, especially having depressed real incomes for the past two decades at least, as well as undermining social cohesion and the quality of life in Australian cities. Unfortunately, both major parties support mass immigration under the guise of addressing labour shortages.


 

Uwe Dulleck

.

I am not sure whether an incoming government can solve a the climate crisis (or whether Australia has an measurable impact) but getting ready for the impact, and getting on board in a joint international effort to address climate change will be crucial - and stays difficult to communicate with the Australian public. But the recent challenges - or fires and floods - should give momentum. Immigration has been for a long time the life blood and main driver of Australian growth. We should rediscover this, and not enter another slump by trying to protect what we have for the Australians that are here. I think history (should have) told us, that doesn't work. The over reliance on real estate for investments, as well as the focus (and overinvestments) on owning your own house creates every specific challenges for economic stability in Australia. The affordability question is then one that adds social stability challenges. There are no easy answers here, but starting to at least develop a strategy would be very important.


 

Craig Emerson

.

Social cohesion will depend on workers sharing in productivity gains. it is unsustainable for the benefits of any productivity growth to accrue mostly to shareholders at the expense of workers. Wages of health workers are too low to assure quality services. Aged care workers receive wages close to the minimum wage yet they are essential for quality care. Nurses, too, are poorly paid. it is unsurprising, then, that there are shortages of aged care workers and nurses. The transition to a low-carbon future needs to be faster and more orderly. Ad hoc interventions and sudden changes in policy have been hindering the transition.


 

ALLAN FELS

.

I chose social support, housing availability and affordability, and health as my priorities because all are chronically underfunded. Also, most of those investments pay off in the long term, as well as creating a fairer Australia which seeks to minimize social and economic disadvantage. I support in principle more spending on defence but it usually is wastefully done. The case for government infrastructure spending is especially weak in present circumstances.


 

Gigi Foster

.

Voters care most at the end of the day about issues that impact their wellbeing right now. After two years of having our machinery of state hijacked by the covid project, the Australian people will be wanting their politicians to acknowledge and attempt to rectify the massive damage that covid policies have inflicted onto their health and their economic situations. They will want to start to heal from the impacts of the ghastly governmental misfires of the past two years. Above all they will want to see compassion and care, rather than more rules and authoritarianism, coming from the mouths of their politicians. The politicians, furthermore, owe them that compassion (along with an apology of gigantic proportions). My selections above are my guesses about in which areas of their lives the Australian people are hurting most heading into the election, but employment, business support, wages growth, and taxation are also worthy contenders.


 

John Freebairn

.

Future governments face at least four sets of structural reform challenges; structural budget deficit; low national productivity; increasing inequity; climate change. A structural budget deficit concerns planned expenditure increasing as a share of GDP, for example on defence, aged care, NDIS, while arguing for no increase in the tax share. One or both sides require reform. Australia's productivity is behind world best practice, and the growth rate has been very low for at least a decade. Productivity growth is key to budget repair and meeting demands for higher real incomes. Governments have key roles in sensible regulations, less distorting taxes and greater efficiency of own expenditure, including commonwealth/state financial arrangements. The growth of income and wealth inequality, and not only of disposable income but also access to education and health, is of concern for equity, social safety and productivity reasons. A more proactive set of policies to encourage investment in both mitigation and adaptation to climate change is demanded globally and for Australia,


 

Paul Frijters

.

Lockdowns and run-away corruption have lead to unprecented drops in mental health, worsening educational outcomes (particularly among the poor) and large increases in government debt. The immediate task of the government will be to get more taxation out of large corporations and the super-rich, which will be a political battle. The second is to undo the damage of lockdowns and thus invest in mental health services and higher quality primary and secondary education. Neither of those priorities require more money, but do require shifts away from inefficient current spending in those areas. The longer-term political challenge will be to push back the expansion of the state and the enormous degree of corruption in all areas of government.


 

Lata Gangadharan

.

I chose the issues which would have a long term effect.


 

Guyonne Kalb

.

Climate and environment is an issue of global importance, and this is acknowledged by many (most?) voters but seemingly not to the same degree by the current Australian government. Australia is very vulnerable to climate disasters and its population would like to see stronger action by the government. There is so much that can be done, especially in terms of renewable energy that we are not doing at the moment. It is important for our survival and would benefit Australia's economy as well. Being the last to use an outdated technology is never wise if it can be avoided. There should be no need for people to be homeless in a country like Australia. Housing is a fundamental human right and necessary condition for doing well in terms of other outcomes such as health, education and employment. There is a shortage of affordable housing especially in well-located areas close to employment, transport, schools. Without access to stable good-quality housing, it is difficult to improve any other outcomes for individuals like health, education or employment and income. In addition to affordable housing there should be better protection for renters than what is currently in place. Tax reform should not be about reducing taxation, but about ensuring taxation is distributed equitably across individuals. As an example, high-income earners should pay more tax in absolute and relative terms than low-income earners. Tax reform should consider how income taxation and income support withdrawal rates interact to avoid high effective tax rates for low-income earners and especially for secondary earners who tend to be affected by withdrawal of family payments and childcare subsidy on top of income tax rates, creating unnecessarily high hurdles for many to enter the labour force or increase hours in work. Relative taxes should be lower at the point of entrance in the labour force than at 50 hours for the same individual (i.e. it should be increasing with income of the individual). This would ensure labour force participation is as high as it can be while ensuring there is revenue to pay for health, education, infrastructure and social support.


 

Michael Keating

.

Climate and environment and employment/wages growth are the two most important issues to tackle. Spending more on social support, health, defence, and education will all be required, but that will depend upon tax reform with the aim of raising more revenue efficiently.


 

Geoffrey Kingston

.

National security and affordable housing for young families are important issues. Likewise, Australian-located businesses need tax and regulatory policies that enable them to be internationally competitive. On the other hand, high terms of trade have historically led to high real wages, so Australia's problem of stagnant wages should resolve itself soon.


 

Michael KNOX

.

1. Esteemed historian Niall Ferguson has said that China may begin an invasion of Taiwan as early as 2023. Taiwan has a strategic position in the South China Sea which would allow China the control the seas lanes that supply Japan, our new ally in "The Quad". All of this suggests that Australia is entering a period of enhanced risk which makes national security and defense the number one matter of political concern. 2. Australia has maintained a long term position as having the highest immigration rate in the OECD. This has been mixed with a skills based selection system . These factors plus the import of capital ,has allowed our economy to growth faster than the US and faster than Europe. Our immigration program has paused but will now resume providing structural support 3. As luck would have it ,Australia is now enjoying the second commodities boom this century with export prices now even higher that in the previous event . History show us that these periods of high commodity prices allow us to sustain high immigration and rising living standards at the same time. However , this time we should also be aware that ,when our terms of trade does eventually begin to fall , our demand for immigrant labor may slow as well.


 

Emily Lancsar

.

My preferences for top three are informed by addressing structural issues of climate change, tax reform and housing affordability which will all have short and long term benefits. Moving beyond top three would include social support and employment/wage growth.


 

Guay Lim

.


 

Elisabetta Magnani

.

Housing availability (including rental housing and social housing), social support to vulnerable groups, health, the care economy and wage growth must be priority policy goals for the incoming government. If left unaddressed, these issues will continue to exacerbate social inequity and aggravate the social divide, particularly in the light of the wealth accumulation dynamics we have witnessed in the last few decades. For this reason, the government must find revenue to tackle these problems, independently of its ability to achieve tax reforms. However, tax reform is an efficient means to address equity considerations in a situation marked by over-reliance on income tax, under-reliance on wealth taxation, neglect of inheritance tax, and unnecessary complexity (such as taxation of subsidies for small and medium enterprise activities). A comprehensive tax reform is essential to support long-term policies (away from "band-aid" temporary policies) that convincingly address the national interest in education and training, industrial innovation, regional cooperation and foreign policy. The incoming government should prioritize climate and environmental policies. Addressing the climate change crisis at this stage and after decades of neglect will require the government to go past recent agreements designed to meet international obligations. Reframing and re-energizing climate and environmental policies will involve work with domestic and international stakeholders, including civil society groups, schools and students, business groups and families. The next government will need to exercise political and economic leadership in the introduction of an energy mix that works to make fossil fuel and "dirty" hydrogen obsolete.


 

Flavio Menezes

.

We face a highly uncertain world. Climate change means more bushfires, more floods, and rising sea levels, which will lead to higher government expenditure both in mitigation and recovery. The necessary energy transition is a massive undertaking. To achieve net zero by 2050, we will need an 800% increase in large-scale wind, solar and hydro generation, as well as a corresponding increase in the transmission network to accommodate this additional capacity. The current government's motto of "technology not taxes" is nothing but an empty slogan. States and the federal government have made significant financial commitments through a myriad of mostly uncoordinated initiatives. All of these expenditures must be funded by taxes. The invasion of Ukraine by Russia, with its terrible human toll and global economic consequences, has highlighted the geopolitical risks associated with authoritarian regimes. This wake-up call will certainly result in increased defence expenditures. These expenditures too must be funded by taxes. Unfortunately, we are awfully unprepared to fund the additional expenditures required to address the colossal challenges of climate change and geopolitical instability. The federal budget has been, and will remain, in structural deficit for some time to come. A structural deficit refers to fiscal imbalances that are caused by fundamental shifts in the economy, such as changes in demographics. Our aging population means more spending on aged care, health, and social security. Our aspirations for a more equitable, progressive society require government spending on education and on the National Disability Insurance Scheme. It also requires a more generous social support system that allows young people to overcome poverty traps. While we will likely have more government reviews and inquires, which will undoubtedly come up with ways to do things better, these will lead to even more, not less, expenditures. These too must be funded by taxes. The bottom line is that regardless of what will be said during the forthcoming May election campaign, taxes will need to rise. It follows that we need to fix our inefficient tax system as a matter of urgency. The sources of the inefficiencies are well known. We need to simplify and reduce our reliance on income tax. A complex system leads to perverse incentives including welfare-reducing tax minimisation efforts by taxpayers. Rather than simply reducing the corporate tax rate, which is lazy reform, we need a business tax that promotes innovation and entrepreneurship rather than rewarding monopoly power. The unequal tax treatment of returns from rent, interest and capital gains also needs to be addressed. If we don't fix our tax system, it will be much more costly to raise the additional revenue to address the budget's structural deficit and to meet the challenges of climate change and increased global geopolitical risks. Inaction will mean that we won't be able to afford some of the things we aspire to achieve.


 

James Morley

.

Australia needs to take action on implementing a price on carbon in order to provide incentives to households and firms to use energy more efficiently. Subsidies for green energy use make sense as well. Productivity growth remains low in Australia, but is crucial for our future standards of living. Public investment in education at all levels is needed to help boost future productivity and will also generate high social returns. Australia has benefited immensely from immigration and has the capacity to increase the number of migrants significantly after negative net migration during the pandemic. More immigration will also help boost productivity and address demographic issues related to an ageing population. Unfortunately, I fear nativism and anti-immigrant sentiments will be common across party lines in the upcoming election.


 

Margaret Nowak

.

The economic story about climate and the environment has not had adequate attention in Australia, being obscured by politics and "special interest" smokescreens especially in the energy sector. Hence the very real costs of climate change have not been factored into current government policies and the potential future cost are disastrously downplayed. Climate change has now significant implications for health costs, housing costs, social support policies and the real welfare of the Australian population. GDP and its growth as an indicator of population welfare is becoming increasingly misleading as climate change impacts of the real costs incurred in insurance, health, cost of food, cost of housing and loss of amenity from the natural environment for example. My three top items can be linked as each is implicated in addressing climate change and this links also into real "welfare" inducing wages, health, social support and even defense, given that climate change has real long term security implications. Tax reform provides the opportunity to address the climate by ensuring that the externalities associated with the release of carbon dioxide into the atmosphere over the short term start to cover their full external costs The resulting revenue can be used to support the health system, address the costs of climate catastrophes etc. and support the development of social housing. Tax reform is also necessary to address the housing affordability issue; this will be a hard one for government given the increasing vested interests of a powerful, and increasingly wealthy segment of the population, home owners and housing owners. It will nevertheless be critical in the longer term to retaining any sense of equity between the generations and needs to be taken up in a hard conversation which needs to be had by all political persuasions . Without that conversation the long-term cohesion of our society will suffer greatly.


 

Alison Preston

.

Rising inequality is already a serious problem in Australia and without interventions to address slow wage growth at bottom end of the labour market, the growth of insecure and precarious jobs and the gender wage gap inequality will continue to be a problem. Inequality hurts the economy, undermines skills development and economic opportunity and contributes to other problems presently observed in Australia (e.g. housing affordability, inadequate resources in the care sector etc.)


 

John Quiggin

.

Overall, the most depressing and dispiriting election campaign I have seen in 50+ years of paying attention. No significant policy offerings from either major part, so we are left with pork barrel bribes and character attacks, which feed into worst kind of media coverage. Climate change and poverty/inequality are the most important issues, but neither party is offering anything substantive. Albanese talks a good game on wages, but apart from aged care, is offering only long run industry policy. Neither party offering progressive tax policy or improvements in welfare. Labor marginally better on climate. Missing from the list is the big picture on fiscal policy: how to manage tax, spending and debt in a world of permanently low, mostly negative real interest rates


 

Mala Raghavan

.

Two critical areas that need attention are climate change and the inefficient Australian tax system. The creeping climate crises and the costly yet ineffective tax systems affect the Australian economy. We need tax reforms designed to increase workforce participation and boost productivity and climate policies to reduce carbon emissions. However, will the government of the day be blinded by their motive for political survival and prepare to put Australia's future at risk?


 

Leonora Risse

.

This list is missing two big issues - childcare and aged care. These issues continue to be sidelined and deprioritised as less important than other portfolios, despite being essential to an optimally functioning economy. These areas do not fall under the category of "social support" - they need to be treated as standalone economic issues. Getting the economic settings right in our childcare and aged care systems (including wage structures and working conditions) will factor into wider economic outcomes including labour force participation and wage growth. Addressing the economic challenges of climate change and housing affordability/ accessibility and homelessness requires long-term foresight, investment and commitment at federalgovernment level. Currently market forces are not steering us towards the most economically effective, efficient and equitable directions on these issues. But government intervention also needs to be intelligently informed by thorough evidence-based economic analysis of the alternative forms of government intervention. Despite tight labour market conditions, wages growth is not yet evident. Partly this is because the conditions that have given rise to a tight labour market have come from supply-side constraints (that have pushed up production costs), moreso than booming demand (that would theoretically generate higher revenue enabling employers to pay their workers more). Wage growth requires productivity-enhancing investments on the supply side of the economy (think skills, innovation, research, digital infrastructure, dismantling barriers to workforce participation), but it also requires a system where improvements in labour productivity flow through to wages. Even before the pandemic, this productivity-wage transmission mechanism had been weakening over time, with a larger share of productivity gains being channelled towards capital owners (shareholders, investors, employers) instead of workers. This is where institutional settings, such as the role of industrial relations tribunal and mechanisms for wage determination, matter. Many economists are likely to agree tax reform is needed, for efficiency and equity purposes, and in the interest of future fiscal sustainability. But tax reform is a "tool" or mechanism, rather than an end goal in itself - each political party is going to have a different idea of what tax reform should look like. Addressing violence against women is an issue that many voters want to see dedicated action on. The Women's Budget Statement this year included a strong focus on women's safety, but total expenditure was a drop in the ocean compared to other government priorities. The budget announced a total of $2.1 billion for initiatives to support for women and girls (covering safety, health, parental leave, and all other relevant initiatives). By comparison, defence received an extra $2.3 billion, taking total defence spending to $38.2 billion. Roads received an extra $3.6 billion, taking total spending on roads to $12.3 billion.


 

Rana Roy

.

Let us assume that federalelection campaigns provide an ideal opportunity for the contending political parties to conduct a serious, sober, and always-honest dialogue on how best to address the issues facing the country, whilst being always-wedded to the larger aim of maximising the general welfare. On this assumption, I would nominate "tax reform" as arguably the most important of the issues listed above. I do so because, quite apart from its potential to contribute to the general welfare directly and independently of other important issues, it is also the key to addressing many if not most of these issues, including the two examples I have chosen: namely, "climate and the environment", and "ousing availability and affordability". On tax reform, I would argue ? and I would invite the contending candidates to address the argument ? that, irrespective of the chosen level of taxation overall, the mix of taxes should make maximal use of welfare-neutral and welfare-enhancing taxes and minimal use of welfare-reducing taxes. That is, we should make maximal use of taxes on economic rents and external costs and minimal use of taxes on labour, capital, and consumption. The current reality is that economic rents and external costs are left largely untaxed, which in turn is attended by higher taxes on labour, capital, and consumption than would otherwise be the case. On climate and the environment, I would argue ? and I would invite the contending candidates to address the argument ? that, in line with the ever-growing body of evidence assembled in the OECD Environment data base, the most efficient and effective means of addressing climate change remains a consistent economy-wide de jure tax on carbon, which alone provides a permanent incentive for businesses and consumers in each and every sector to adopt new ways and means to reduce carbon emissions. The current reality is that the de facto tax on carbon (what the OECD calls the effective carbon rate, or ECR) varies widely between sectors, with carbon emissions in some sectors being over-taxed ? think petrol ? whereas others are left untouched. Moreover, there is an urgent need to attend to the relatively neglected issues of air, soil and water pollution ? in part by means of new and well-designed taxes on the external cost of pollution. (Globally, air pollution alone kills several million people each and every year, at a social cost of several trillion US dollars per year, as I have documented in several of my publications over the last decade.) On housing availability and affordability, I would argue ? and I would invite the contending candidates to address the argument ? that we need to institute inter alia a universally-applied tax on the gain in the unimproved value of land, at a level high enough to capture the economic rent embodied in that gain, and transfer it from the landowner to society as a whole. This alone would contribute greatly to transforming the housing market into a normal market, the site of the production and consumption of the essential good that we call shelter ? rather than being, as it is today, a happy hunting ground for seekers of unearned wealth in the form of ever-rising property prices, the consequence of which is that ever more of their fellow Australians are locked out of this market. Moreover, such a transformation of the housing market would enable inter alia a massive re-direction of lending from current unproductive use ? that is, bidding up property prices ? to potentially productive use in every sector. It would thereby make a positive contribution to addressing two other important issues listed above, namely, "employment/wages growth" and "support for businesses". Of course, the observant reader will have taken note of the assumption stated at the outset and on which my answer rests. And the observant reader may well conclude that my starting assumption is not at all well-founded and that the rest of my answer may therefore be set aside for the duration of the election campaign!


 

Stefanie Schurer

.

Australia has fallen behind dramatically with the richer countries in the world to implement measures to reach its Zero Net Emissions 2050 goals. Ranking "dead last" on climate issues (Climate Council) is not only embarrassing in an international context, but also incredibly shortsighted given Australia's exposure to extreme weather events such as extreme heat days and excessive rain. This should be the single most important issue for the incoming government. Countries like Germany, Norway, Denmark, among many others could provide valuable case studies on how to navigate the treacherous transition period. Of course there are other important issues that should be considered such as long-term investments in education (including tertiary education and vocational training) to produce the human capital needed to change the structure of Australia's industry, which is particularly critical if immigration numbers remain capped.


 

Nigel Stapledon

.

There is unity on need for a stronger commitment to defence, but beyond that the campaign looks like being a policy free zone. The problem there is that, assuming a Labor government, it will be hamstrung on doing anything in the same way that the Abbott Coalition government was after it won in 2013. Without a mandate to do anything, its a slippery slope. The missing policy issue a government will confront is inflation. If it is big problem in the US, which it clearly now is, then no government here can afford to ignore it. The pain of the 1970s and 1980s inflation appears to have been forgotten. Its cost was extremely large. The idea that government can drive real wages growth without productivity as its source and not feed inflation is dodgy economics and would be very risky economic policy. And despite talk about productivity, beyond motherhood statements, there is no strategy out there worth a pinch to actually do anything to lift productivity and support wages growth. On the issue of renewable energy, the focus should be on the most efficient way to get there. Too much on symbols, following the Europeans. Are subsidies for (producers of) electric vehicles the most efficient use of dollars? I doubt it. Tax reform - no chance. With an increase in the GST ruled out, there is no scope to contemplate a more efficient tax system. The Henry Tax Review will remain in a bottom draw.


 

Susan Thorp

.

The government needs to make clear energy and climate policy addressing both adaptation to climate change and mitigation of emissions. Immigration of skilled migrants and casual workers has support productivity and will continue to be a key component of economic management and growth. This need not be a limit on wages growth. Housing availability and affordability and a major contributor to welfare and distortions in the taxation and social security system that limit affordable housing should be corrected.


 

Joaquin Vespignani

.

The housing affordability is reaching a critical point with median house prices more than 25% higher than in 2020. I urge policymakers to rethink the Australian taxation system, as more and more young Australians have lost any hope of buying a house in a country with one of the lowest population densities in the world.


 

Rachel Ong ViforJ

.

We need some long-term policy thinking to address the intergenerational transmission of our huge debt burden. This can be done through tax reform that shifts away from preferential treatment of non-productive assets and at the same time increases work incentives. Policies that promote long-term productivity and wage growth should also be prioritised. These policies combined should have long-term positive flow-on effects on housing affordability as wage growth catches up with housing price growth.


 

Beth Webster

.

Having a clear focused plan to transition to net zero is essential for our long-term survival. Climate change is a threat to both economic and political stability. Social support has been neglected for eight years, which undermines civil society. Business need support to hasten the transition to net zero carbon. Commercialising the type of risky innovations needed to transition the economy will be too slow in an unsupported market environment.


 

Danielle Wood

.

Climate change is the biggest economic and environmental challenge for Australia and the world. We have committed to net zero by 2050, but progress is still too slow over the next decade leaving us with a bigger and more disruptive task to decarbonise through the 2030s and 2040s. The policies that will make a difference are well known and the next government will be on the wrong side of history if we don't move now. Housing affordability (for first time buyers and renters) is also a major challenge with significant effects on economic and social opportunity, particularly for younger generations. Again, the policy levers are well known - reducing barriers to supply particularly in inner and middle ring suburbs (which would also be a significant productivity reform), scaling back investment tax breaks, increasing social housing and rent assistance would make the biggest difference over time. Finally, social supports need reconsidering. Too many Australians live in poverty and suffer financial stressors (missing meals, not being able to hear their home etc) because of the punitively low level payments, particularly JobSeeker. Working age welfare payments are so low as to be a barrier to effective job search. Even a substantial increase in the payment ($75 a week) would still leave it at only about half minimum wage, meaning there would still be substantial incentive to take paid work where available.