AICD submission into the Productivity Commission inquiry on the five pillars of productivity – priority reform areas

The AICD receives consistent feedback from members that Australia has become an increasingly difficult place to do business, including making capital investments and driving innovation. A central concern among directors is the cumulative weight of federal, state and local regulation is crowding out the capacity of organisations, and their boards, to focus on strategy, growth and long-term value creation. 

Our key recommendations under each pillar include:

Pillar One: Creating a dynamic and resilient economy

• We recommend the Commission consider how best to streamline administrative processes and reduce unnecessary compliance burdens to significantly enhance business dynamism and resilience.
• We recommend the Commission consider how a growth-focused regulation agenda can level the playing field between large and small businesses by simplifying reporting thresholds and tailoring compliance obligations to business size and risk profile.
• Easing the regulatory burden via a whole-of-economy approach will help ensure Australia’s international competitiveness and support its productivity. We recommend specific measures to achieve this, including:
  • 1) expanding the regulatory initiatives grid economy-wide;
  • 2) mandating post-implementation reviews for new legislation;
  • 3) revitalising the Regulation Impact Statement process; and
  • 4) refreshing Statements of Expectations for regulators to appropriately prioritise productivity and economic growth in carrying out their duties.  

Pillar Two: Building a skilled and adaptable workforce

• We recommend the Commission prioritise action to address workforce and skills shortages by supporting a more dynamic, responsive jobs market and enabling a national approach to occupational licensing.

Pillar Three: Harnessing data and digital technology

• We recommend consideration of whether the implementation of the outstanding Privacy Act Review recommendations should be paused to allow for a more rigorous review of the costs and benefits of the recommendations in totality. The existing maze of Commonwealth and State data retention obligations should also be addressed prior to further privacy reforms. 
• We urge the Government to prioritise immediate steps for de-identification of director personal information on the ASIC companies register, recognising the significant privacy and security risks.
• We recommend the Government act with urgency in delivering its National AI Capability Plan, and in issuing clear guidance on how existing regulation applies to AI.
• We recommend Treasury conduct a public consultation that also draws insights from the international experience of implementing a fit-for-purpose digital financial reporting regime that benefits preparers and users.

Pillar Four: Delivering quality care more efficiently

• We recommend the Government starts to implement the proposals from the 10-year roadmap Not-for-profit Sector Blueprint delivered in November 2024.

Pillar Five: Investing in cheaper, cleaner energy and the net zero transformation

• We recommend that the Commission encourage the Government to prioritise national policy certainty to improve the cost-effectiveness and alignment of emissions reduction policies across the economy.