Economic Policies and Regulatory Reforms

The Council of Australian Governments (COAG) agreed in February 2006 to a comprehensive National Reform Agenda which builds on a quarter of a century of national economic and social policy reform.

The COAG National Reform Agenda aims to deliver significant economic and social rewards. Heads of Treasuries have advised that it has the potential to deliver over the next decade benefits of the same size, if not even larger, than those achieved in the last decade from the implementation of national competition policy and associated reforms. The Productivity Commission has estimated that national competition reforms have permanently increased the level of Australia 's GDP by
2.5 percent, or A$20 billion.

The three streams of the COAG National Reform Agenda are human capital, competition and regulatory reform. The human capital stream of reform includes a package of education and training measures designed to give more people the tools to participate in work.

The competition stream of the COAG national reform agenda is a substantial addition to, and continuation of, the highly successful National Competition Policy (NCP) reforms. It will further boost competition, productivity and the efficient functioning of markets. It focuses on further reform and initiatives in the areas of transport, energy, infrastructure regulation and planning and climate change technological innovation and adaptation.

COAG endorsed a new NCP reform agenda aimed at providing a supportive market and regulatory framework for productive investment in energy, transport and other export-oriented infrastructure, and its efficient use, by improving pricing and investment signals and establishing competitive markets.

While structural reforms undertaken under NCP and other COAG initiatives since the early 1990s have significantly improved the efficiency of the energy sector, COAG also agreed to ensure the electricity transmission system supports a national electricity market, providing energy users with the most efficient, secure and sustainable supply of electricity from all available fuels and generation sources, and includes where appropriate an increased share of renewable energy. COAG committed to adopt suitable policy settings, governance and institutional arrangements and other actions to improve the framework for planning and network investment and to streamline regulation.

Given the majority of Australia's population and markets are concentrated in urban areas distant from one another, COAG has agreed to improve the efficiency, adequacy and safety of Australia's transport infrastructure by committing to high priority national transport market reforms including to:

COAG has also signed a Competition and Infrastructure Reform Agreement to provide for a simpler and consistent national system of economic regulation for nationally-significant infrastructure, including for ports, railways and other export-related infrastructure. The agreed reforms aim to reduce regulatory uncertainty and compliance costs for owners, users and investors in significant infrastructure and to support the efficient use of national infrastructure.

COAG also agreed to a package of measures designed to reduce the regulatory burden of business. COAG agreed that all governments will avoid unnecessary compliance costs and restrictions on competition, undertake targeted public annual reviews of existing regulation to identify priority areas where regulatory reform would provide significant net benefits to business and the community and identify further reforms that enhance regulatory consistency across jurisdictions or reduce duplication and overlap in regulation and in the role and operation of regulatory bodies.

The Australian Government is committed to continuing its program of reform to build competitiveness throughout the whole economy, including its services to the resource industries. As a result, Australia is one of the best countries in the world in which to explore and develop petroleum resources.


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