Source: Prime Minister of Australia
an I also begin by acknowledging the traditional owners of the land on which we meet and I pay my respects to elders past, present and emerging, and thank you for that wonderful Acknowledgement of Country.
This is the fourth time that I’ve had the opportunity to address this Conference as Prime Minister of Australia.
Looking back on the discussions we’ve had here is a reminder of just how much the world has thrown at our nation and our economy in that relatively short period of time.
In 2023, the conversation was dominated by the ongoing inflationary impact of the global supply shock which had followed the pandemic, combined with the international energy crisis brought on by what is unfortunately ongoing, the Russian invasion of Ukraine.
By the time I was with you last year, the focus was on the global fallout from the United States’ tariffs and the support our Government was providing to Australian industry and agriculture.
Now, back then, if you did a survey in this room and asked people to show you the Strait of Hormuz on a map, if it was more than half of you, then you would have been doing pretty well.
But we know, we are all acutely aware, that the effective closure of what is one of the world’s most important shipping routes has created the biggest spike in the price of petrol and diesel in history.
It is extraordinary to think that story has fallen off the front page – but we know the situation is far from resolved.
Which is why our Government is working every day to secure shiploads of petrol, diesel, jet fuel and fertiliser, above and beyond normal volumes.
So that we have the supply in place to support our farmers, our truckies, our miners and our regions if things get worse.
The nature, and the cause, of each of those global shocks has been different.
But they are not a disconnected sequence, their impacts overlap – and they add up.
And they have taken a compounding toll on wages, inflation, investment, productivity – and of course on people.
Indeed, in some ways the pattern of the 2020s has been that just as workers and employers are dusting themselves off from the last international shock, the next one arrives.
These headline events – pandemic, conflict and crisis – are not passing storms. They are the extremes of a more volatile global economic climate.
We see that in the breakdown of the predictable world of ever-expanding free trade and globalisation.
Ongoing strategic competition in our region.
Artificial Intelligence disrupting and re-shaping the future of work in ways that all of us are yet to fully quantify.
And the global shift to clean energy, the biggest economic change since the industrial revolution.
It is a powerful tribute to the resilience of Australian business and the Australian people that that over the last four years, 1.2 million new jobs have been created, with the lowest average unemployment for 50 years. Wages growth over three per cent in every quarter. The gender pay gap at an all-time low. And gross debt over $170 billion lower than we inherited – saving $70 billion in interest costs over the decade.
This national resilience was underlined in Wednesday’s National Accounts.
Where the Australian economy continued to grow faster than almost every major advanced economy. Growth driven – overwhelmingly – by business investment.
Indeed, as a share of our economy, business investment is now at its highest level in a decade.
That resilience is remarkable.
But it is not natural, or inevitable – it is structural.
Which is why the Budget that the Treasurer, Jim Chalmers, delivered last month, focused on both resilience and reform.
That combination – and that balance – drives our Government.
We do not view global uncertainty as an excuse to delay – we see it as a reason to act.
They say the best time to fix the roof is when the sun is shining – but the work we have to do cannot wait for blue skies.
Hard decisions cannot be put on hold for easier times.
The challenges confronting Australia are too urgent to hang back.
And the opportunities ahead of us are all too important to miss.
Our approach is about dealing with the immediate concerns here and now – but in a way that builds for the future.
So we don’t settle for just getting through this current crisis.
We learn from it – and change for the better because of it.
That means building up our fuel security and our energy sovereignty.
Broadening and diversifying our economic base and our manufacturing capacity, through our Future Made in Australia agenda.
Strengthening our trade ties in our region – and securing new market access for Australia in Europe, India and the UAE.
Capitalising on the global investment in AI that is flowing into Australia.
By making sure that new data centres bring cleaner, cheaper energy into the grid and put downward pressure on bills for industry, small business and households.
And in everything we do, pushing for a long overdue turnaround in productivity.
Our Government knows how important it is that we keep working to boost Australia’s productivity so that our economy has the headroom to grow, without putting pressure on inflation, and so that the sacrifices Australians have made through this decade are repaid with lower taxes, higher wages and a better standard of living.
This is a longstanding challenge – and it is one that business and government can only solve together.
Last month’s Budget demonstrates we are determined to do our part.
We are speeding-up approvals on housing, energy and resources – combining state and federal processes to cut out a whole layer of process and paperwork.
Permanently introducing two‑year loss carry‑back for all companies up to $1 billion in turnover.
Delivering loss refundability for start‑ups, to help new businesses invest and grow in their first two years.
Expanding tax incentives for venture capital and making it easier for Australian firms to commercialise their breakthroughs.
Improving our Research and Development Tax Incentive to support businesses that invest in innovation.
And breaking down outdated state and territory divides on skills and standards that make it harder to find and hire essential workers.
Our Government’s agenda for growth and productivity is about investing in our national strengths and broadening them out.
Incentivising business to create jobs in our nation – and engage with our region.
Empowering workers to learn new skills and embrace new technologies.
Backing small businesses that back themselves.
And – above all – building on the values that unite us, as Australians.
The deliberate choices we have made, over generations, about the kind of country we want Australia to be.
Where wages provide fair reward for hard work.
A world-class education system where your opportunities are earned on merit, not limited by wealth.
Health care that doesn’t depend on your employer’s plan, or how much you earn.
Universal Medicare that every family can count on and afford, wherever they live.
Universal superannuation, not only providing working people dignity and security when they retire, but also making every worker an investor in our economy, a shareholder in our national success.
And home ownership.
Not as a distant dream but as an aspiration that working people on average incomes can save for – and achieve.
More than just a roof over your head, the foundation on which you can build a good life for yourself, start a family and plan for your future.
That’s the Australian way to build resilience.
A model for growth and prosperity that gives our citizens a stake in the economy – and a stake in our nation’s future.
Now, all of us take pride in that.
We recognise this is part of what makes Australia different to the rest of the world.
And we should never discount that the rest of the world recognises this too.
There’s a reason that young expats come home to start a family.
Or people who come here to study want to come back as citizens, to live and work and give their children an Australian education.
There’s a reason that so many members of the Singaporean diaspora call Australia home.
Or that 1 in 8 of all New Zealanders live here in Australia.
I put that in because I’m meeting the New Zealand Prime Minister later today.
And whenever I meet with investors in New York, or Abu Dhabi, or Jakarta, or the EU, they want to do business here in Australia.
Because whether they are building a data centre or opening a retail chain, they recognise that investing in this country means buying-in to a stable democracy with a skilled workforce.
With an abundance of clean, cheap energy.
Every natural resource that will shape the future of the global economy.
And trade partnerships with the fastest-growing region of the world in human history.
Building our resilience is about building on our strengths – and addressing our vulnerabilities.
The disruption to global supply chains we saw during pandemic and now again in this fuel crisis have laid bare the fiction that Australia could run as a just-in-time economy.
That our country could offshore manufacturing, cut skills, close refineries, privatise assets and narrow-down our industrial base, and still get by as the last link in the global supply chain, because someone else, somewhere else would be there to sell us what we needed cheaper than we could make it ourselves.
That mindset left our economy exposed.
It also took good, secure jobs away from regional communities.
It hollowed out suburbs built around industrial centres.
And it fed a perception that economic change was something imposed, something that happened to people.
A wave that eroded old certainties, without creating new opportunities.
For years, the housing market has been feeding that same sentiment.
The changes the Howard Government made in 1999 to Capital Gains Tax were supposed to boost investment in the share market.
Instead, they turbo-charged property as an investment vehicle.
And that fundamentally altered the equation in a bad way for first home buyers – and for young Australians.
Since 1999, house prices have risen by over 400 percent.
More than twice as fast as average incomes.
And in the same period, home ownership rates for Australians aged between 25 and 34 fell by 7 percentage points.
It is no wonder that more and more young people – and indeed their parents and grandparents – have been worrying they will never own a home.
That feeling of having the deck stacked against you is only magnified when young Australians turn up to an auction and get outbid by property investors being given a leg-up from the tax system. If you’re there at an auction as a first homebuyer, as a young couple, and you’re competing against an investor. And the investor knows they’ve got a partner there with them, every taxpayer. So, if they’re going to go next to $20,000 or $50,000, they can do so now, and that will lead to a reduction in their tax in which they pay. It is no wonder that people have felt frustrated by that personal and very real experience.
Our reforms to negative gearing and capital gains tax remove these distortions.
Bringing more first home buyers back into the market.
We’re preserving negative gearing for new builds – to boost supply.
And investors – across the board – will still get a discount, but one based on inflation.
Around 90 per cent of small business owners will still be eligible for four existing concessions, which remain in place.
Meaning if they do decide to sell their business in the future, they will pay less tax or even zero tax on their capital gain.
What we’re doing is we’re are rebalancing the system so that investment decisions are driven by economic reasons, not tax outcomes.
So we better align the way Australia treats income earned from work, compared to income derived from assets.
This matters for all of us.
For Australia’s economic outlook, for business confidence, for growth and productivity and living standards.
And importantly, for our democracy and social cohesion more broadly.
Because when Australians feel like the economy isn’t working for them.
That their hard work isn’t adding-up to fair reward.
That they’re worried their children or grandchildren will have less security and fewer opportunities than they did.
This sentiment hasn’t come out of nowhere.
It is pressure that has built up, over years.
And it’s not just a vague feeling – it’s a reality that working Australians are up against, it’s something they can see for themselves.
It is a logical response, not just an emotional one.
And it deserves practical solutions, not slogans.
You might be able to build a brand of politics out of amplifying frustration and seeking to harvest it – but that doesn’t take our country forward.
What counts, what matters, what makes a difference, is whether you have a plan to do something about it.
That is why our Government does not stop at acknowledging Australians are under pressure – we’re acting on it.
By delivering real change that makes a positive difference to people’s lives.
Whether it is Medicare, the National Disability Insurance Scheme, the housing market, our skills and migration system, our energy grid, employment services or the tax system, this kind of meaningful, structural reform is hard work.
If big change was easy, Australia would not be two decades into a national conversation about why we urgently need tax reform.
We do not doubt the challenges we are up against.
But we approach them with optimism, with determination and with the clear understanding that doing nothing is simply not an option.
If you look around the world, you can see what happens to countries and economies when people make up their minds that the system is broken beyond repair.
The decision for Australia is clear.
We can choose whether the social and economic dislocation we see overseas is a warning that we act on, or a preview of what is to come.
Our Government has no intention of standing around and wringing our hands about the consequences of a system that isn’t working for people.
Instead, we are acting to fix it.
You saw that again this week:
A real increase in the minimum wage.
The $250 Working Australians Tax Offset.
The $1000 Instant Tax Deduction.
And our reforms to give more young Australians a fair crack at the opportunity of home ownership.
The framework for these changes passed the House of Representatives yesterday.
As we have said all along, we will engage in good faith on the detailed design of the legislation that will follow.
Over the last four years, my door has always been open to discussions with business.
But this is not going to be a long, drawn-out process that ends with fiddling around the edges of the status quo.
Because this moment presents a bigger opportunity for deeper co-operation.
Our Budget – with its productivity reforms and its tax reforms – is further proof that our Government is not here to occupy the space, or pass the time.
We are determined to deliver real change.
We are serious about economic reform.
We will make hard decisions to make it happen.
We will put the long-term national interest, ahead of short-term politics.
And I look forward to continuing to work with the businesses in this room, continuing to engage with the media organisations hosting us here as well.
To build a stronger, more productive and more resilient Australia.
Thanks very much.