Australia's climate failures are costing its economy – and Scott Morrison's government is being blamed

© Provided by The Guardian Photograph: Mike Bowers/The Guardian

The latest OECD economic survey of Australia details an economy that has weathered well the Covid storm, and yet while the Morrison government will enjoy such talk, it will not like the advice that comes with it – recommendations to improve our low productivity growth, inequality and to massively reduce our emissions.

© Photograph: Mike Bowers/The Guardian A quicker pace of emissions reduction remains toxic to Scott Morrison’s government – as the prime minister lacks the political will or power to challenge the climate change deniers in his government.

The OECD only surveys a country every few years. The latest, released overnight, is the first for Australia since December 2018.

Back in 2018 global pandemics were merely the stuff of movies; and so the report was focused on keeping growth at around 3%. Back then, the OECD noted of Australia, “life is good, with high levels of well being”.

This time the opening is rather less ebullient.

Yet the OECD praises our Covid response, noting, “well-coordinated policies across different levels of government sought to suppress Covid-19 transmission” and that the economic “downturn in 2020 was less significant than in the majority of other OECD countries”:

If the graph does not display then click here

The report’s authors note that Australia had one of the biggest stimulus packages and the one that was most targeted for the 2019-20 financial year:

If the graph does not display then click here

But it also notes that the latest outbreaks and lockdowns “are having a significant negative impact on economic activity”.

The OECD estimates that the Delta strain also means the next economic rebound “may be more gradual than in previous episodes, given it will occur in an environment of higher community transmission of Covid-19”.

And while the OECD always prefers a budget surplus to deficit, it notes that the current low interest rates mean that “the government could run primary fiscal deficits in the coming years and still put the government gross debt ratio on a downward path”.

But the OECD survey is not just about summarising the current situation, it also delivers recommendations – a number of which the government will not wish to hear.

The OECD has long been a proponent of more tax being raised by the GST than personal income and company taxes. It notes that our GST has a lower rate and many more exemptions than most of the OECD and suggests both should be changed:

If the graph does not display then click here

That of course is not going to happen anytime soon – unless Scott Morrison decides he really wants to lose the next election.

The OECD also suggests now is a good time for a review of our monetary policy framework. It suggests a broad review that potentially includes “a review of the central bank mandate, policy tools, methods of public communication, hiring processes and internal structures”.

While that might be politically fraught, it is more palatable for the government than the OECD’s other recommendation that fiscal policy have much greater transparency by tasking the Parliamentary Budget Office with the power to “regularly evaluate and monitor the fiscal strategy”.

Such a role would be more akin to that of the Congressional Budget Office, and is incidentally something I have long argued in favour of, but would see the government’s own policy being subjected to analysis – something it will not agree to.

The report also argues for a further increase in unemployment benefits noting that “the income shock from falling into unemployment in Australia is much larger than in other countries and minimum income supports remain well below the relative poverty line”:

If the graph does not display then click here

And as in 2018, the report tackles the ongoing issue of slow productivity growth that has been in place since 2013:

If the graph does not display then click here

Among the policies the OCED recommends to improve productivity are introducing an inheritance tax, reducing the capital gains tax discount and replacing stamp duty with land tax.

While Josh Frydenberg has praised states like New South Wales for shifting towards a land tax, there is no way the government will increase taxes on retirees and property investors.

Neither will it likely push to implement other productivity spurring recommendations such as road-user charges (another long-favoured OECD policy) or a resources rent tax (yes, a “mining tax”).

But where the report is most uncomfortable for the Morrison government is when it comes to climate change.

Rather than swallowing the government’s line about meeting and beating its emissions target, the report notes “faster progress in reducing carbon emissions is needed”:

If the graph does not display then click here

The report notes as well that Australia is “uniquely placed to benefit economically from global decarbonisation due to a large (and windy) land mass, high solar radiation, [and] plentiful ocean access”.

Unfortunately, the report found that “there has been a trend decline in environmental innovation over the past decade and stronger incentives for innovation and adoption of new low emission technologies are needed.” So much for our policy of reducing emissions through technology not taxes.

This failure is blamed on the Morrison government.

The report argues “a coherent and coordinated national strategy that defines clear goals and corresponding policy settings” for achieving net zero emission by at least 2050 “is needed”.

Failure to do so since the end of the carbon price has meant Australia has missed out on “significant economic benefits” that “can come from a quicker pace of emission reductions”.

That again remains toxic to the Morrison government – as the prime minister lacks the political will or power to challenge the climate change deniers in his government.

And so the Morrison government will find much to like in this survey about what the OECD reports of 2020, but much to ignore about what it recommends for the future.

News Related

OTHER NEWS

AIs could become reward junkies — and experts are worried

In 1953, a Harvard psychologist thought he – accidentally – within the cranium of a rat. With an electrode inserted into a specific area of its brain, the rat was ... Read more »

Iconic British brands MINI Cooper and Paul Smith collaborate on a new electric car

Paul Smith designed the interface, interiors and body of the MINI Strip. The coming together of two British icons—Mini and designer Paul Smith—is a match made in heaven. Much like ... Read more »

Gaming addiction: Kerala to open digital de-addiction centres for children

In a major child-friendly initiative, Kerala Chief Minister Pinarayi Vijayan on Saturday announced setting up of “digital de-addiction centres” in the state to bring children addicted to online games into ... Read more »

Piaggio's India arm sets up first EV facility in Chennai

After Chennai, the company further looks to expand its EV presence in various other markets in Tamil Nadu, Nair added. Italy-headquartered Piaggio Group’s Indian subsidiary Piaggio Vehicles Pvt Ltd has ... Read more »

Huawei CFO leaves for China, detained Canadians head home

Huawei Chief Financial Officer Meng Wanzhou flew home to China on Friday after reaching an agreement with U.S. prosecutors to end the bank fraud case against her, relieving a point ... Read more »

First made-in-Thailand virtual influencer debuts Human-like AI Ailyn takes digital marketing to a new level

AI Ailynn, a virtual influencer created by SIA Bangkok Co. (Photo from SIA Bangkok Instagram) She poses. She chats. She inspires you to buy stuff you never knew you needed. ... Read more »

Explained: What are Bitcoin, blockchain and the cryptos shaking up the world of finance?

Ever looked at the headlines, scratched your head, and wondered what Bitcoin and cryptocurrency actually are? We've got you covered. So, what are cryptos? Cryptocurrencies are virtual currencies that can ... Read more »

Sony still has ‘a lot' it wants to bring to the PS5 through future firmware updates

Sony has said that it still has plenty of “interesting, exciting, fantastic ideas” it wants to bring to the PS5 through future firmware updates. This comes from SVP of Platform ... Read more »

Samsung Galaxy Z Fold 3 vs Microsoft Surface Duo: two different foldable ideas

Samsung has come to dominate the fledgling foldable phone format, with the Samsung Galaxy Z Fold 3 representing one of two third-generation foldable devices from the brand. But it isn’t ... Read more »

Far Cry 6's world isn't as big as Assassin's Creed Odyssey's, but it's more ambitious

Set on the fictional Caribbean island of Yara, Far Cry 6 looks to push the boundaries of what we’ve seen from the long-running series before, offering not just a region ... Read more »

Finished Ted Lasso? This Bollywood sports movie is the inspirational film you need

In the wake of Ted Lasso’s glorious Emmy win, it’s easy to see that the beloved Apple TV Plus show has stirred our collective love for an inspirational, underdog sports ... Read more »

Best Nvidia RTX 3070 laptop 2021: play in 1440p wherever you go

The best RTX 3070 laptop is going to bring powerful performance to your gaming and content creation on the go, usually without breaking the bank either. While not the cheapest ... Read more »

Prince William Promises 'We Can Create a Better Future' in Earthshot Limited Series Teaser

Prince William is soon to be streaming on a screen near you. The Duke of Cambridge, 39, is ramping up for his Earthshot Prize Awards on October 17, and PEOPLE ... Read more »

Your iPhone already tracks your steps. What if it tracked your mood, too?

Apple is reportedly working with UCLA to develop new technology that uses facial recognition and other behavioral tracking tools to detect depression in iPhone users, according to a recent Wall ... Read more »

Save $50 on the Nanoleaf Elements wood-styled LED panels

Kicking off these deals on the smart home lighting front, the Nanoleaf Elements light-up wall panels — just released in the summer — have a nice discount at Best Buy. ... Read more »

Cyber fraud: Thane man loses Rs 5.30 lakh to cyber criminal

A Thane man studying in Dublin University in Ireland has allegedly lost Rs 5.30 lakh to a cyber fraudster, police said on Saturday. Mandar Kotnis, pursuing his Masters in Computer ... Read more »

The Latest: Roadside bomb hits Taliban car, at least 1 hurt

1 / 2AfghanistanTaliban fighters enjoy a boat ride in the Qargha dam, outskirt of Kabul, Afghanistan, Friday, Sept. 24, 2021. (AP Photo/Bernat Armangue) KABUL, Afghanistan — A Taliban official says ... Read more »

Petrol stations impose £30 fuel limit as motorists panic buy amid lorry driver shortage

A man carrying containers at a Tesco Petrol Station in Bracknell, Berkshire. (Getty) Almost 350 petrol stations across the country have imposed a £30 fuel limit after motorists filled up ... Read more »

Gabby Petito's best friend says Brian Laundrie once lived in the Appalachian mountains by himself 'for months'

Brian Laundrie and Gabby Petito. North Port Police Department Gabby Petito's best friend Rose Davis said Brian Laundrie can survive in the wilderness. Davis told People that Laundrie once stayed ... Read more »

Amazon Kindle storage space: how much memory do you need on an ereader?

When you’re buying a new Amazon Kindle, unless you’re looking at the base model which only comes in 8GB, you’re going to be presented with a choice regarding how much ... Read more »

What to look for when buying your first electric car

Looking into buying your first electric car? Factor in its range, charging speed and whether its charging port will play nice with most stations. Read more »

Sick of paying for gas? Here's what to look for when shopping for your first electric car

That’s it, you’ve had it. You can’t justify paying $3.50 a gallon to fill up your tank. At the same time, perhaps you’ve had an epiphany about contributing to climate ... Read more »

Lego released a Marvel Avengers Advent calendar—here's where to buy it

— Recommendations are independently chosen by Reviewed’s editors. Purchases you make through our links may earn us a commission. It might only be September but if you’re a planner, you ... Read more »

Sky's iPhone 13 deals offer some of the cheapest prices on all four devices

All four of Apple’s new iPhone 13 handsets are now available to buy and if you’re looking to get them on a budget, Sky Mobile is looking like one of ... Read more »

A new Kindle Paperwhite is coming soon – here's the previous model for cheap

There’s nothing better to do in the cold winter months than snuggle up indoors with a good book. A Kindle Paperwhite allows you to store thousands of books at once ... Read more »

Leeds vs West Ham live stream: How to watch Premier League online from anywhere

Just one point adrift of the relegation zone, Marcelo Bielsa’s go in search of their first league win of the season as they welcome a buoyant Hammers side to Elland ... Read more »

Neo-Nazis are still on Facebook and they're making money: Report

BRUSSELS – It’s the premier martial arts group in Europe for right-wing extremists. German authorities have twice banned their signature tournament. But Kampf der Nibelungen, or Battle of the Nibelungs, ... Read more »

Why Google Chrome's incognito mode may be a ‘problem' for Sundar Pichai

Google Chief Executive Sundar Pichai in 2019 was warned that describing the company’s Incognito browsing mode as “private” was problematic, yet it stayed the course because he did not want ... Read more »

Samsung Galaxy S22 Ultra shown off in full by unofficial renders

The Samsung Galaxy S22 is expected to be unveiled at the start of next year, and a set of high-quality, unofficial renders have now given us our first proper look ... Read more »

Samsung Galaxy M52 5G with 120Hz AMOLED display, 5,000 mAh battery, triple cameras to launch in India on September 28

Samsung is gearing up to launch the Samsung Galaxy M52 5G in India on September 28. However, the device has already been revealed under the radar in Poland. The Galaxy ... Read more »

Marvel's Guardians of the Galaxy: New trailers showcase gameplay and exploration

Marvel’s Guardians of the Galaxy should be the superhero team game fans have been waiting for. This is Square Enix and Eidos Montreal’s another attempt at making a Marvel game ... Read more »

Amazon's bestselling mini digital projectors are on sale—save up to $140, today only

Yahoo Life is committed to finding you the best products at the best prices. We may receive a share from purchases made via links on this page. Pricing and availability ... Read more »

Sony APS-C cameras to get its first Sigma mid-range zoom: Reports

Popularity of models in Sony A6000 series, including the A6000 itself and newer cameras like the A6600, A6400 and A6100 have increased amongst consumers over time. Online reports suggest that ... Read more »

How recruitment 'ghosting' is impacting mental health of job applicants

According to a new report, 86% of respondents said the experience of being ghosted by a recruiter had left them down or depressed in some way. Photo: Getty You spend ... Read more »

‘Worst eight months of my career': Andrew Neil says he came close to breakdown at GB News

Andrew Neil has said he was “close to a breakdown” during his time at GB News and said his time involved with the channel was the “worst eight months” of ... Read more »

Boston Dynamics' Spot robot will boldly go where humans shouldn't — and make work safer

This article is part of our series that explores the . Boston Dynamics has just released the latest update for its famous , giving it better capability to make inspections ... Read more »

Monarch butterflies are being wiped out. These combat veterans are trying to save them.

Guardian Grange looks to provide a safety net for veterans while teaching them about conservation, sustainability and regenerative agriculture. Read more »

Queen came up with gags for London Olympics James Bond sketch herself, reveals Daniel Craig

Queen and James Bond – AFP The Queen came up with ideas for the London 2012 Olympics James Bond skit herself, Daniel Craig has revealed. Her Majesty’s big reveal during ... Read more »