Cormann warns Labor and Coalition that mimicking populists won't cut living costs
Mathias Cormann has warned Labor and the Coalition not to copy populist economic policies in an effort to win back voters.
Cormann, the secretary-general of the Organisation for Economic Co-operation and Development (OECD) and Australia's longest-serving finance minister, is scheduled to deliver an address to the Centre for Independent Studies. He argues productivity is the only way to reliably lower the cost of living over the long term, according to The Guardian.
His warning comes as the latest Guardian Essential Poll put One Nation's primary vote at 25%, above the Coalition's 22%. Cormann said the major parties will be wiped out if they simply ape the policies of populists, according to the Sydney Morning Herald.
On migration, he said arbitrary caps would affect business and hospitals and urged politicians "not to shrink the country" in response to calls to cut the intake. Cormann said concerns about the current intake are legitimate, but the answer is to address housing supply, infrastructure, services and the composition of the intake.
OECD research across Australia's regions found that in places where more migrants arrived, employment among Australian-born workers grew faster, not slower, with no measurable effect on their wages. Cormann said without migration, Australia's working-age population would decrease as the number of older people grows.
He also criticised tariffs imposed by US President Donald Trump and proposed by One Nation, saying they would fail to address the cost of living and could raise costs for farmers, miners and builders.
Instead, Cormann urged politicians to deliver homes, lower energy costs, real wage growth and a credible budget by boosting productivity. He said getting productivity growth back to its long-run average would make Australians at least $14,000 a year better off by 2035, according to The Australian.
He said both sides of politics have failed over the past 20 years to embrace the changes needed to protect living standards, and said Australia must overhaul taxes and embrace AI to lift productivity.
