My thoughts #AICD “Shaping a Nation” with Mark #Pesce Futurist, Paul #Broad CEO Infrastructure NSW, Warren #Hogan Chief Economist #ANZ, Michael #Reenie #McKinsey and Co.

My thoughts #AICD “Shaping a Nation” with Mark #Pesce Futurist, Paul #Broad CEO Infrastructure NSW, Warren #Hogan Chief Economist #ANZ, Michael #Reenie #McKinsey and Co. http://wp.me/p2g64Q-1Z

• Productivity is the number one question
• Major infrastructure projects started and stoped, very poor use of capital
• Rail system in Sydney works at half the throughput of a similar one in Europe
• Productivity is about innovation
• Innovation has 3 type -Things you want to do, ones you have to do, the ones forced on you
• People do not like to change, new businesses need to be extremely thin
• Planet is now very well connected, need to realise the potential of being connected
• Australian working off Hawke / Keating Changes and we have had no structural reform since that period
• Currently being ran by populism with no courage for change
• Currently no vision in Government, no leaders
• Politician do not understand innovation, Swan does not understand
• Need Competition, Need intellectual capital, get politicians out of the way to let market deal with it
• Government needs to get out of town, need to get away from career politicians

Labour Market Productivity
• Unions killing Businesses, they hate flexibility, they just want fee’s some they can spend
• Need greater labour mobility, even Executive staff don’t like to move. 20 yrs of good times have set this up. US has been traditionally flexible due to their low social blanket
• Labour security is falling onto the worker
• People like FIFO because people will not live there. FIFO increases project costs.
• Skills training needs to be continuous and not a one off retraining session
• A welfare state stifles innovation and competitiveness. If we didn’t have payments over last 10 years we would have $0.5T
•

Innovation
• We have a lot friction but not a lot of innovation. Will lead to driverless trains, people free mines etc
• The smartest people are the poorest people, staying on the edge of technology is an advantage
• The connected world is driving us, A cloud world will change the world. Call centres can be decentralised,
• Need to find the technology and work out how to utilise it.
• The difference between an idea and an innovation is commercialisation and this is hard
• Necessity is the mother of invention
• The Drought lead to a lot of innovations, we need to create a pressure
• Some great education initiative’s

Future Investment
• Education is key
• Need to build up our knowledge base

The Big Risks
• Don’t address Productivity
• Government interfere in the markets
• Lack fitness – High $, Low productivity, become non competitive
• Government investment in welfare
• Will always have overseas difficulties, up to us to be the best, hence we need leadership
• Politicians do not give the electorate any credit

Questions

• Should we have a Melbourne Sydney Fast Train – North Coast trains needs to be more efficient, better option than NBN but economics don’t stack up
• Should be driving our trains from low cost countries, this can be safer, lower O&M
• War can be fought by remote control
• Productivity Improvement, what needs to occur? Bring in short term workers, Health system needs to be rebuilt, the IR laws need to go back, 70% of productivity is in organisation.
• Need to challenge organise to improve
• Education – Need to keep University’s and TAFE separate. TAFE should be supported by Corporate and are about skills, Universities are investment in the Future and need higher levels and Government Funding and they are about learning.
• Educations – Masters degrees have become a ticket and need to increase. Need a Stafford etc
• School Class sizes, halls etc don’t matter, Teaching Skills are the most important thing.
• New Industries ie CSG take a period to sell to the community, we are pushed back by government and the media, we need to tell out story, get rid of spin merchants and get the CEO to be the spokesman
• If you wish to get through to a politician, get in the newspaper
• Outside Carbon what are the big Environment Issues? – Cyclones in north, Flooding Western Sydney (200k people), Should price pollution and let the market work it out.

Final Comments
• Best Environment for wealth creation, though unstable
• Australia is in the best position in the western world, but at tipping edge
• Corporate World needs to tell its stories and debate the pollies
• Need Courageous Leaders, that allow the economy to run
• Need more industries to link into Asia
• Best Country in the World, good democratic system