Invest
Roaring ’20s or wasted decade: Budget to decide
Australia’s economy faces either a decade marred by ‘epic policy failures’, with stagnant economic growth, or a scenario reminiscent of the roaring 1920s, with the upcoming budget critical to getting the country back on track, a think tank states.
Roaring ’20s or wasted decade: Budget to decide
Australia’s economy faces either a decade marred by ‘epic policy failures’, with stagnant economic growth, or a scenario reminiscent of the roaring 1920s, with the upcoming budget critical to getting the country back on track, a think tank states.
A report released by the Blueprint Institute states that the Liberal Party now has the opportunity to turn around years of poor economic growth, leading the country into more prosperous times.
Despite Australia looking likely to be on the road to recovery, with business confidence and labour figures bouncing back, report lead and Blueprint Institute’s chief economist, Steven Hamilton, opined "normal isn’t good enough".
“Our economy was barely growing as the crisis struck. Investment, productivity and wages were all languid,” he said.
Instead of returning to normal growth, the economist said, Australia should look to set itself up for the next decade.
“The decade we have is up to us. Just as the last roaring ’20s – in the shadow of World War I and the Spanish Flu pandemic – were an era of rapid economic and cultural change, these ’20s can be roaring, too,” Mr Hamilton said.
“This Budget Blueprint offers ideas for how we could pop the cork, with four policy areas showing tremendous potential to open a new golden era.”
Sparking the next boom
Mr Hamilton believes that in order to ‘spark the next boom’ Australia should now focus on its innovation, technology and the arts.
As part of this, Australia should establish a research institute for sudden catastrophes to protect against the next COVID.
The government should also waive minimum investment taxes to kickstart R&D while establishing a $3 billion endowment to help Australia’s creative industries through annual grants.
“We need smarter policies to spark the next boom. And we must make sure a future sudden catastrophe doesn’t put it at risk,” Mr Hamilton said.
Igniting the next boom
Despite rising government debts, the government is being advised to avoid austerity and raising taxes in order to pay the debt back.
As part of the next booming decade, the Blueprint Institute said Australia should have a $3,000 flat deduction for taxpayers putting hundreds back into workers’ pay packets.
According to the institute, Australia should also look to increase the controversial JobMaker scheme, but remove the age restrictions.
“As we emerge from the pandemic with record public debt, the focus should be on raising revenue in the way that best enables paying it down. That means raising more revenue more efficiently, and shrinking public debt as a share of the economy via rapid economic growth,” Mr Hamilton said.
Powering the next boom
After decades of inertia on climate policies, Australia runs the risk of being increasingly isolated when it comes to climate action.
The Blueprint Institute noted that Australia needs to phase out coal, triple green R&D spending, develop EV charging infrastructure and have a diversification plan for fossil fuels.
“We should also position ourselves to take advantage of the new opportunities a net-zero economy promises,” Mr Hamilton noted.
Nurturing the next boom
To continue Australia’s economic prosperity, the country needs to invest in the next generation, the institute noted.
“Our early learning system is anti-productivity. Early learning is not affordable for many families, creates disincentives for parental work, and harms childhood development. Wholesale reform is needed to nurture young minds and unleash a new wave of economic growth,” Mr Hamilton said.
As part of the changes, Blueprint suggests introducing a default, free pre-kindergarten for kids aged three to five to “level the playing field for all children”
Parents with children under three would meanwhile be eligible for a “streamlined” and means-tested single payment to support their childcare payments. Under the scheme, childcare would become tax-deductible.
RELATED ARTICLES
About the author
About the author
Economy
Australia’s growth beat is real — but it’s the wrong kind for capacity
Australia’s economy outpaced forecasts in the June quarter as households opened wallets and government spending did the heavy lifting, even as public investment sagged. The signal for boardrooms: ...Read more
Economy
Australia’s growth is back—but it’s the wrong kind of strong
GDP surprised on the upside in the June quarter, powered by households and government outlays even as public investment slumped. The Reserve Bank stayed hawkish, signalling that sticky services ...Read more
Economy
Australia's Economic Resilience: Strong GDP growth challenges RBA's policy stance
In a surprising turn of events, Australia's economy has shown greater resilience than anticipated, with the latest Q2 GDP report revealing a stronger performance largely driven by vigorous household ...Read more
Economy
Economist calls for July RBA rate cut following inflation data
An economist from State Street Global Advisors has called for the Reserve Bank of Australia to cut interest rates in July following today's Consumer Price Index data for June. Read more
Economy
GDP data prompts economist to predict faster RBA rate cuts
Australia's latest GDP growth data has come in significantly below expectations, prompting an economist to suggest the Reserve Bank may need to ease monetary policy more aggressively. Read more
Economy
Global markets face turbulent start amid tariff concerns, but outlook remains cautious
Global equity and bond markets have experienced a turbulent start to 2025, primarily due to concerns that a potential tariff-driven trade war could heighten inflation and recession risks. Read more
Economy
RBA may cut rates faster if GDP data disappoints, economists say
The Reserve Bank of Australia may cut interest rates more quickly if next week's GDP data disappoints, economists said following today's consumer price index data for May. Read more
Economy
RBA delivers widely expected rate cut as inflation optimism balances global uncertainty
The Reserve Bank of Australia has cut the cash rate by 25 basis points, delivering on widespread market expectations while signalling a clearer directional shift towards less restrictive monetary ...Read more
Economy
Australia’s growth beat is real — but it’s the wrong kind for capacity
Australia’s economy outpaced forecasts in the June quarter as households opened wallets and government spending did the heavy lifting, even as public investment sagged. The signal for boardrooms: ...Read more
Economy
Australia’s growth is back—but it’s the wrong kind of strong
GDP surprised on the upside in the June quarter, powered by households and government outlays even as public investment slumped. The Reserve Bank stayed hawkish, signalling that sticky services ...Read more
Economy
Australia's Economic Resilience: Strong GDP growth challenges RBA's policy stance
In a surprising turn of events, Australia's economy has shown greater resilience than anticipated, with the latest Q2 GDP report revealing a stronger performance largely driven by vigorous household ...Read more
Economy
Economist calls for July RBA rate cut following inflation data
An economist from State Street Global Advisors has called for the Reserve Bank of Australia to cut interest rates in July following today's Consumer Price Index data for June. Read more
Economy
GDP data prompts economist to predict faster RBA rate cuts
Australia's latest GDP growth data has come in significantly below expectations, prompting an economist to suggest the Reserve Bank may need to ease monetary policy more aggressively. Read more
Economy
Global markets face turbulent start amid tariff concerns, but outlook remains cautious
Global equity and bond markets have experienced a turbulent start to 2025, primarily due to concerns that a potential tariff-driven trade war could heighten inflation and recession risks. Read more
Economy
RBA may cut rates faster if GDP data disappoints, economists say
The Reserve Bank of Australia may cut interest rates more quickly if next week's GDP data disappoints, economists said following today's consumer price index data for May. Read more
Economy
RBA delivers widely expected rate cut as inflation optimism balances global uncertainty
The Reserve Bank of Australia has cut the cash rate by 25 basis points, delivering on widespread market expectations while signalling a clearer directional shift towards less restrictive monetary ...Read more
