Potential Benefits of the National Reform Agenda

This research paper which investigated the potential economic and revenue impacts of a National Reform Agenda (NRA) found that the NRA has the potential to significantly raise national output and incomes in Australia. The main purpose of the study was to help governments better understand the scale and distribution of the reforms’ anticipated broad economic and fiscal impacts. There are three streams to the National Reform Agenda: human capital, competition and regulatory reform. The Commission was asked to provide estimates of: the economic benefits potentially available from implementing proposed reforms and outcome objectives; and the total revenue benefits expected to accrue to the Australian Government and each of the State and Territory governments from the potential economic benefits generated by the NRA. The Commission found that reforms aimed at improving productivity and efficiency in energy, transport and related infrastructure and reducing the regulatory burden on business, if fully implemented, could increase GDP in time by up to around $17 billion or nearly 2 per cent. If the potential for a 5 per cent improvement in the productivity of health service delivery was realised, this would result in resource savings of around $3 billion and increase GDP by some 0.4 per cent. Human capital reforms targeting health promotion and disease prevention, education and training, and work incentives could potentially yield even larger gains. The Commission found that all jurisdictions would receive increased tax revenues flowing from reform induced growth. For the competition and regulatory reform streams, Governments’ combined net revenues could rise by as much as $5 billion. Potential net revenue outcomes are more speculative for the ‘human capital’ reforms.