By Mark Kenny and National Affairs Editor
Paul Keating has called for a return to soaring imagination in public policy development, saying the country was in danger of missing the turns and thus failing to capitalise on the huge opportunities of the global digital age.
Branding these changes as the most important reform phase for Australia now, he has launched a withering attack on narrow politics and business groups who peddle a "nostalgia for the reform politics of the 1980s and 1990s" which they resisted at the time, and which have now been done anyway.
Former prime minister Paul Keating.Credit: Nic Walker
In a deliberately visionary speech, he described the twin forces of "globalisation and galloping international digitisation" as the levers staring governments in the face right now, if only they possessed the foresight and understanding to use them.
"If you can't imagine it, you sure as hell are never going to see it," he said.
Then treasurer, Paul Keating, attending a Master Builders Federation of Australia seminar in 1987. Credit: Robert Pearce/Fairfax Media
Since the last recession in 1991, he said Australia had witnessed two big phases of reform through its own re-structuring during the Hawke-Keating period, and through the remarkable changes in China that had transformed the region and the world.
But the next one, the digital horizon, was still being conceived, requiring policy makers to visualise the vast possibilities for efficiency and completely novel commerce replete with "competition and complementarities" and what he called "the accelerating ubiquity of the global digital economy".
Delivering what he believes is one of his more important speeches in decades, the former Labor treasurer and prime minister told the Committee for the Economic Development of Australia, it was of little use to look backwards because such nostalgia "is not going to advance us" in the digital age.
"It was not, as is often today suggested, a period of consensus between the parties on what needed to be done," he said.
"Today the Business Council of Australia tells us we need to go back to the Keating reform era. When we were actually in the Keating reform era, the Business Council was of no help."
He said they had opposed "the notion of a tax on consumption, the taxation of capital profits and fringe benefits, and therefore they opposed the means necessary to fund lower personal income and company taxes and put into place dividend imputation".
"They also opposed our enterprise bargaining reforms, as did the opposition, and I can tell you the then Liberal and later Howard opposition did not wave things through as conservative apologists suggest these days."
Mapping out the challenges for Australia in 2017, he said "today, the economy is still crying out for liberating forces, in the nature of those we employed in that tumultuous period", while organisations like the Business Council pretend that a "reduction in the corporate tax rate or hopping into low-paid workers by knocking off their penalty rates" constituted reform.
"The limitedness of it is remarkable – the laziness and backwardness of it, profound," he said.
Rather than harping on about eras past, he said the country needed "a new golden age" of reform driven by these present realities and pushed by political leaders who possessed the vision to conceptualise beyond the constraints of the public service.
"Changes on a canvas of this kind are not going to drop from any department. You will not find them falling from a Treasury printer. Because of their essence, they require imagination, the principal tool that was employed in underwriting the '80s and '90s changes," he said.
According to Mr Keating, governments are in danger of missing the turns and were already trailing consumers who have taken advantage of the greater choice and lower prices from the digital marketplace and "the smorgasbord of things on offer – and at their fingertips".
"The wider phase, the grander phase, where even larger gains are to be had, is in the heavily government-influenced areas of health, aged care, education and human services," he said.
"These are the reform horizons we should be concentrating on, and not the dross handed down from the Business Council ... the whinging from the ACCIs of this world about penalty rates, when the reality of static wages growth stares us in the face."