Albanese and Chalmers Face Pre-Budget Hurdle with Productivity Commissioner's Concerns
Prime Minister Anthony Albanese and Treasurer Jim Chalmers are facing a pre-budget challenge in the form of concerns raised by Productivity Commissioner Danielle Wood regarding their "Future Made in Australia" plan.
Despite a concerted effort by the government to win over Wood, she remains skeptical about the effectiveness of increased government intervention in driving chosen industries towards a net-zero future.
Wood's concerns stem from her belief that Australia should focus on its comparative advantages and leverage global trade to access cheaper green products, rather than attempting to subsidize domestic production. She warns against the potential for "infant" green technology to become "hungry teenagers" perpetually reliant on government support, citing the local car-making industry as an example.
Furthermore, Wood emphasizes the need for independent oversight to prevent government subsidies from becoming a "giant pork-barrelling scheme."
While Chalmers acknowledges Wood's concerns and agrees on the need for "exit ramps" from government subsidies, the government remains confident in its plan. However, Wood's skepticism, coupled with criticism from former ACCC boss Rod Sims, suggests that the government may need to refine its approach to garner broader support for its "Future Made in Australia" initiative.