How much longer must we put up with the PC – by Roy Green

This week’s report from the Productivity Commission targeted Australia’s energy policies as a form of industry assistance – anathema to the dry economic policy group. Here, Roy Green finds the Commission out of touch with Australia’s needs.

This is another tiresomely predictable and formulaic report from the Productivity Commission.

Ironically it takes issue with the very policy measures most likely to grow productivity.

These measures are designed very sensibly to diversify Australia’s narrow resource-based industrial structure, facilitate our energy transition and enable our participation in the more complex, knowledge intensive industries and technologies of the future.

Right now Australia produces 50 percent of the world’s lithium but captures only 0.53 percent of its final value.

By insisting that Australia remains a quarry on the basis of an outdated theory of comparative advantage, the PC would deny the opportunity for this country to gain competitive advantage from its critical minerals through the development of a value adding battery manufacturing industry.

Meanwhile they are comfortable with perpetuation of the Diesel Fuel Tax Rebate, which at $7.9bn a year (for large mostly foreign owned mining companies) is equivalent to three quarters of the entire Commonwealth spend on research and innovation.

For how long does the Australian taxpayer have to fund this destructive monopoly source of economic advice?

Emeritus Profess Roy Green is Special Innovation Advisor, UTS, Sydney, and Chair Port of Newcastle and the ARM Hub.

Further reading:
Rescuing the Productivity Commission from itself – By Phillip Toner and Roy Green

Picture: Energy Renaissance