‘Inflation is way too high’, RBA governor says
Liberal senator Jane Hume opens the questions:
Can I first ask whether you believe current monetary policy settings are expansionary, contractionary, or neutral?
Dr Phil Lowe:
As things currently stand, it’s restrictive.
Hume: Is that the same as contractionary?
Lowe:
Yes. You see that in the fact that housing prices are falling, the rate of home-building has slowed down and people are having to pay a lot more on their mortgages. Those things are all contracting or restricting growth in the economy.
Hume:
When you make your decision, when the board makes its decision on interest rates, whether to raise them, whether to lower them, whether to keep them the same, what are the things that it takes into consideration?
Lowe:
The decision making is really around – the centre point is the inflation target and inflation outcomes. Inflation at the moment, 7.8%, is way too high. It needs to come down. That’s our primary consideration.
When we take our decisions each month, we’re looking at the data on inflation, the data on the labour market, how household spending is evolving and how the global economy is evolving.
All those things are important and the Reserve Bank Board meets every single month and we look at each of those things each month and make an evaluation on the outlook for inflation.
As I’ve said, it’s way too high and it needs to come down.
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Jane Hume then seemingly discovers that there is a clause in the RBA Act which allows the government to overrule the RBA’s decisions:
Did you realise that if the Treasurer doesn’t agree with your policy position that, after a certain amount of toing and froing with the board and swapping of papers, that he can submit a recommendation to the Governor-General and then the Governor-General, acting with the advise of the Federal Executive Council determine the policy adopted by the bank. The Treasurer can override the Reserve Bank’s policy?
Philip Lowe:
That’s been the case since 1959. That position has never been used and in my view it would be a retrograde step to use it.
It’s a set up so Hume can land the punch line “let’s hope we don’t see Stephen Jones marching up to Admiralty House anytime soon!”
Lowe makes sure to bring it back to seriousland though:
Ultimately the Government can overrule the central bank. It would be unwise to do it unless we went crazy. I view it as a safeguard mechanism. It’s never been used and let’s hope it never will be.
Jane Hume gets another five minutes:
Q: You’ve spoken in the past about the buffers in people’s household budgets or their mortgages more importantly. Can you talk me through how that has played out or how it’s playing out in what you’re seeing? In your decision-making, what it is that households have in their savings or mortgages?
Philip Lowe:
It’s a critical issue because the pool of excess savings in Australia is as large as anywhere in the world, the pool that was built up during the pandemic. It’s more than 20% of one year’s household disposable income.
There’s a huge pool of excess savings. It’s not evenly distributed across the population. Lower-income people, obviously, haven’t got the same savings as higher-income people.
And one of the analytical issues we’re grappling with here is how do people view these savings? Do they see them as just an increment to their wealth that they can spend over coming years?
Do they view it as a piggy bank that they can go and use over the next little while? So we don’t know the answer to that and it’s one reason we’re watching the spending data very, very carefully.
We’ve spoken to the banks about the people with fixed-rate loans. Some of these people have a split loan with a fixed-rate and variable-rate component and have an offset account against the variable-rate component and they’ve built up substantial buffers in those and other people who just have a fix rate loan have a deposit account where they’ve built up substantial buffers. Banks tell us that people with fixed-rate loans, most of them, have been pretty cautious. They knew interest rates weren’t going to stay low forever.
They’ve taken a low interest rates for two, three or four years as a bonus and saved some. That’s good.
Not everyone is in that case, though. Some people have taken the lower interest a its to allow them to spend more and those people are going to face a lot more difficulty when interest rates go up by 3%.
Repayments have to go up by three percentage points. So it’s a huge diversity across the population that the banks tell us they’re work being their customers. They’re contacting them in advance and a large number of people in fixed-rate loans have built up substantial buffers.
Q: Do you get data about mortgage stress?
Lowe:
We do. We get frequent data on the share of the population that’s behind on its mortgage. It’s almost a record low. We also get data on the share that’s behind 30 days. That’s ticked up a bit but it’s still low and the banks say people are still paying their mortgages. This increase in interest rates, while it’s come quickly, people can see it coming and they’re adjusting their behaviour. I want to acknowledge it’s really, really hard for some people. Some people are going to find a very big increase in their mortgage payments. Other people are better prepared.
Here is how Malcolm Roberts’ questions are going:
So inflation has gone from not a problem to a 30-year high, 7.8% in the December quarter. On 2 February 2022, Dr Lowe, you said inflation had surprised on the upside and in March ‘22, you predicted inflation would peak at 4.2%. That was at the ABA Australian banking association conference that we both attended. Why were you surprised, Dr Lowe, when many, including myself, had spent 2020 and 2021 warning the Reserve Bank and the government, including its own investments, that sheer volume of the money would eventually cause significant inflation.
(Must be hard being the Cassandra of the parliament, fated to never to be listened to)
Philip Lowe is unfailing polite:
Certainly people – and you were one of those people who were making the argument that money supply expansion was going to be inflationary – and that has played a role, but as we were talking about before, at least half and maybe three-quarters of the increase in inflation is due to what went on in Europe and the supply side disruptions.
The expansion of money supply, low interest rates and government support during the pandemic has driven inflation, but it’s not the full story.
Roberts: Is 7.8% inflation the price the public is paying for the Reserve Bank supporting the Government’s wasteful, mismanagement of COVID using lockdowns and other restrictions, leading to JobSeeker, JobKeeper, mismanagement that the government caused wishes is what necessitated the money creation? Did you even consider saying to the government, no, I’m not going to print this massive amount of money? So perhaps reconsider your COVID strategy?
Lowe seems to get a bit exasperated here:
No, we did not do this – and I want to be clear about this – we did not do money creation on the request of the government. The nine people who sit on the board of the Reserve Bank decided to do this and we had meetings with the government…
Roberts:
Understood but was it because the government had put in place so many onerous restrictions.
Lowe:
No. It was because – and it’s easy to forget this now – in early 30 we were being told by the health people that tens of thousands of Australians would be dead within months. Remember? There were preparations for temporary morgues in our cities. Our borders were closed. We were told the vaccine was maybe three years, maybe longer away. So this was going to be something that would take the society a long time to get over. That’s what we were being told.
…We saw what was going on in New York and Italy. It was really, really terrible and scary. People were locked in their homes. And, you know, t it turns out that scientists developed a vaccine more quickly and the economy was more resilient and we did too much. But we didn’t do too much because the government told us to or we wanted to. We thought this was the right thing to do given the information we had at the time.
Roberts has more ‘truth’ but he is out of time.
Daniel Hurst
Defence asked about rotations of American B-52 bombers through Australia
The head of the Department of Defence, Greg Moriarty, has given a very carefully worded response to a question from the Greens senator Jordon Steele-John about rotations of American B-52 bombers through Australia. The potential for these to be nuclear-armed was the key point of the question.
The context is that there is expected to be space for up to six American B-52s once an upgrade to a parking apron at RAAF Base Tindal, 320km south-east of Darwin, is completed.
Moriarty said:
Stationing of nuclear weapons in Australia is prohibited by the South Pacific Nuclear-Free Zone Treaty to which Australia is fully committed.
There is no impediment under this treaty or the Nuclear Non-Proliferation Treaty to the visit of foreign aircraft to Australia [or] the transit of Australia’s airspace, including in the context of our training and exercise programmes, and the Australian force posture cooperation with the United States. Australia’s long-standing arrangements to support visits by US strategic assets are consistent with our obligations under the South Pacific Nuclear-Free Zone Treaty.
US bomber aircraft have been visiting Australia since the early 1980s and have conducted training in Australia since 2005. Successive Australian governments have understood and respected the longstanding US policy of neither confirming nor denying the presence of nuclear weapons on particular platforms. Australia will continue to fully comply with our international obligations. And the United States understands and respects Australia’s international obligations with respect to nuclear weapons.
The Greens senator David Shoebridge followed up by trying to get confirmation that Defence did not believe there is a was restraint to Australia permitting nuclear-armed B-52 bombers to be present in Australia provided it was not a permanent presence.
There was no direct answer provided. The foreign affairs minister, Penny Wong, said the government was “not in a position to go further than what Mr Moriarty has just gone”. She accused Shoebridge of “trying to drum up concern” and she did not believe that was responsible. Shoebridge replied that it was not fear mongering; he was just seeking clarity.
LNP senator Gerard Rennick and One Nation senator Malcolm Roberts are now asking questions, so we will just catch up on some of the other committees for a moment.
Luke Henriques-Gomes
Banking company that ran cashless debit card handed $12m ‘limited tender’ contract
The banking company that ran the cashless debit card, Indue, has been handed an $12m “limited tender” contract for the new income management card to be used in the Northern Territory and other areas.
A tender published on 13 February indicated Services Australia had awarded an $11.89m “confidential” contract to Indue under a “limited tender” due “extreme urgency or events unforeseen”.
Under questioning from the Greens senator Janet Rice, Services Australia acting deputy chief executive Jonathon Thorpe confirmed the contract was for the new income management card that will replace the old “basics card”.
He confirmed no other companies were approached or able to vie for the contract due to the “short time frame for the transition of customers off the cashless debit card to other arrangements”.
Thorpe said the agency also wanted to make sure customers weren’t impacted and had a “seamless transition from the cashless debit card to enhanced income management”.
He said:
Part of doing that was to understand how the account currently works on the CDC, the bank account, the card itself and the service arrangements, and [participants] are able to make a smooth transition across.
Thorpe said Indue would provide the banking services, such as the bank account, the physical card, and the “connection in the financial system”. “In other words the ability for customers to use that card in various scenarios being online, retail environments or face-to-face retail.”
Thorpe said the the tender was consistent with the procurement rules and the agency sought advice, including an assessment on “value for money”.
Indue has previously been awarded contracts for the basics card, as well as the cashless debit card.
The Albanese government vowed to scrap the Coalition’s “privatised” controversial cashless debit card – which operated as a trial in several sites – if it won the 2022 election, a promise it followed through on in October.
However, it also said that while it conducted further consultation it would maintain the income management policies that existed in the Northern Territory, which date back to the Intervention and are carried out with the basics card.
The replacement to the basics card, known as the “smart card”, will be rolled out on 6 March for those in the Northern Territory and Cape York, and others who wished to opt-in in Ceduna, East Kimberley, Goldfields, Bundaberg and Hervey Bay regions.
The government said it would have additional restrictions on card spending, including blocking tobacco purchases, but no changes to the quarantined amount of welfare payments, which remain at 50% of an individual’s payments.
It also noted Services Australia would support customers directly through a dedicated phone line for day-to-day queries. In the past, cashless debit cardholders were required to contact Indue with some queries.
Lowe on what can be done to address supply-side issues
Nick McKim’s final question is on what can be done to address the supply side issues of inflation:
How do you think monetary policy addresses supply-side issues? And whether you accept that there are other ways to reduce inflation – levers that the government has rather than the RBA? For example, tax policy, that would reduce inflation but would be able to be better targeted towards those who have the capacity to pay?
Philip Lowe:
We’ve talked about the various measures the government could do. It could manage aggregate demand, or do things like it’s done in the energy market. There are options there, and I’ll leave it to others to make judgements about what the right combination is there.
On monetary policy and supply shocks, there’s very little that monetary policy can do to offset supply shocks. Sometimes you’ll want to respond to the higher inflation that comes from a supply shock to stop inflation expectations rising and staying high. But if that doesn’t happen, you can let the supply shocks wash through the system. But the other point I want to make here is probably half – a quarter to half, maybe roughly – is from demand.
And we really saw that in the December quarter. This was really quite important for us. In the December quarter, the price of clothing and footwear went up 2.2% – that’s 5% in the year. In other countries, it was starting to slow. The price of non-durable household goods, stuff you buy at Kmart or a department store, up 2.3%. 12% over the year.
That’s not because of global supply problems. They’ve been fixed up.
McKim: It could be profiteering, couldn’t it?
Lowe:
And strong demand. Retailers tell us demand has been strong. The price of meals out at restaurants up 2.1% in the quarter – 7% over the year. That’s strong demand. People are going out. They were celebrating with their families for the first time in three years. Strong demand. Prices go up.
And the strongest example was the cost of domestic travel and accommodation. 7% up in the quarter. We’re all travelling again and wanted to go on holidays. Strong demand. Prices go up. So a lot of the inflation we saw in the December quarter was because there is strong demand in the quarter.
There is increasingly a demand element to the inflation. We’re hoping that – we’re starting to see some evidence of this – that demand is moderating and the rate of increases in these areas will come back at the same time the supply-side problems will fix up as well. So that’s the basis – inflation comes back down.
But demand is driving part of the inflation most recently.
Likelihood of wage-price spiral is ‘relatively low’: Lowe
Nick McKim moves on to bank profits:
You’ve spoken again today, as you often do, about wages. And yet you’ve not said anything today – and you rarely do – about corporate profits. So the CBA has just announced a 9% profit, do you accept that when you put interest rates up, that increases the profits of big banks? And would you agree with Dr Kennedy’s statement this morning that the likelihood of a wage price spiral is low?
Philip Lowe:
When we put up interest rates, the immediate effect, I think, is a boost to bank profits, particularly if they’re slow in raising deposit rates, which they have been. And I know the government is concerned about that – rightly. But over time, higher interest rates leave the economy – it’s kind of a “better now, maybe not so good later on”. That’s how it works out.
On the risk of a wage-price spiral?
I think it’s relatively low.
But if we’re wrong on that, the costs are very high. This is the kind of thing. It is low, but I don’t want to give the impression that we’re not worried about it, because we are.
Not because the probability’s high, but because the cost of that happening is very high.
…This is why I draw attention to it. Not because I’m overly worried about that at the moment. The wage outcomes are still consistent with inflation returning to target, and businesses telling us that next year they’re expecting to give smaller increases than this year. That’s all positive, and we welcome that. And I only talk about the wage price barrier to remind people that, if that were to change, it’s going to be difficult for us all.
Is the plight of homeowners and renters being factored into RBA decisions?
Nick McKim then wants to know when Philip Lowe gets input from people who aren’t motivated by profits – homeowners, renters, people who are not attending lunch with bankers.
Dr Lowe, you say you can’t live in a bubble, and I think that’s right. And you hear directly from bankers at lunches like the one at Barrenjoey. You hear directly from big business through your business liaison program. But how are you ensuring that the pain that renters and mortgage-holders are feeling is adequately factored in to the decisions that the RBA is making? How are you hearing directly from the people that are bearing the brunt of decisions? In other words, you’re hearing directly from people who have a desire for profit. Big business, the banks. Understand that they want to make money. That’s their job. How do you make sure you’re factoring in the pain that is being felt by the people that are bearing the brunt of the pain from interest rate rises? How do you make sure that you factor those matters into your decision-making at the appropriate level compared to big business and big banks who are just interested in making more money?
Philip Lowe:
Yeah. It’s a very good question. Recently, I met with the head of Acoss, who stressed the mortgage stress people are under. I get many letters from people in stress. I hear that with a heavy heart. Our financial team also talks with financial counsellors.
There’s some of that in the recent statement on monetary policy. We reach out as best we can to these various groups.
It’s harder to get together people who have got a … we talk to Acoss, we get direct feedback from individuals, and we talk to the service providers who are helping people who are in difficulty, and we hear the message loud and clearly, and we factor that and we talk about it every board meeting, how this is really, really hurting some households.
But we also talk about if we don’t get on top of this, the pain will be worse. It’s not a nice message, but that’s the reality we face. And we have to face into that reality.
RBA governor pressed on timing of bond market jump and his lunch with bankers
Nick McKim picks up on that last answer:
It’s the timing of it, Dr Lowe.
Lowe:
It’s the timing of it, I accept the timing, people find that difficult. If I’d had my time again, I’d do things differently.
But we have changed our policy now. But it’s the timing. And I addressed the issue about the market moves, because when I saw that, I was concerned about something untoward that could have happened. But these are the facts as I know them, and I want to share those with you.
I arrived at the lunch at 12.30, after the executive committee at the bank. And I had a brief discussion with the CEO and the chief economist at Barrenjoey about their business model and how things were going and the competition they were bringing to the marketplace.
And then went into the room with maybe 15-20 guests, sat down, and I started speaking probably around 12.50, after the CEO of Barrenjoey told the room about the things they were doing.
So I would have started speaking at around 12.50, and the lunch finished at 2.00. So we’ve looked at the bond yields.
They’d been rising earlier in the morning, and for an hour or two they’d been flat, then they started rising at 12.00.
McKim:
So you don’t think there’s a correlation?
Lowe:
They rose kind of fairly steadily between 12.00 and 2.00.
…Exactly the same movements were happening in the New Zealand market at the same time. And over the couple of days, the movements in the Australian yields were almost exactly the same as the movement in US Treasury’s.
So they’re the facts as I know it.
The movements in bond yields started before and a lot of it was already done before I started speaking.
They’re the facts as I know it.
I can’t say any more.
We’ve investigated it thoroughly, and that’s what we’ve found.
Philip Lowe asked about lunch with bankers and bond market jump
Greens senator Nick McKim gets the question stick again:
I just wanted to make it clear that my statements around vacancy rates in Melbourne and Sydney being about the long-term-run average levels were based on the Statement on Monetary Policy that was issued by the Reserve Bank on last Friday. Dr Lowe, you’ve addressed to a degree your BarrenJoey lunch. Thank you to your commitment to make more public statements before you do events like that in the future. I think that’s a good thing. But can I ask you what did you share with a bunch of bankers that are at the Barrenjoey banquet that you can’t share with mortgage-holders and renters? And why did the bond market jump so markedly actually during that lunch that you had? What did you say to them that pumped up the bond market so markedly while you were actually at that lunch?
Philip Lowe:
What did I share with them? I shared the messages in the statement that was released on Tuesday afternoon. And those messages included that we’re serious about getting inflation under control. We’re on a narrow path. And we want to preserve the gains in unemployment we’ve made. They’re the main messages. I’ve talked about those much more expansively today than I did at that lunch. And I sought views from the people at that lunch on a range of issues, including how resilient is household spending, how the labour market’s likely to evolve, as the wage outcomes we’re seeing at the moment – are they likely to be sustained? Also, how our message has landed. Got mixed feedback on that.
We talked about the potential for supply shocks in the future to make inflation more variable. That was an issue I raised in a speech last year, and how we should be thinking about monetary policy about about that. And also talked about the level of interest rates in Australia being lower than elsewhere in the world. And I got their views on that. It was interactive. And I pushed back on the proposition that I shared things with them that I’m not sharing here or with the Australian people.
Matt Canavan then has his last question:
We just seem to have an unhealthy focus on international developments here, and not enough focus on what we’re doing to our own energy markets right here and how that impacts on inflation. Is there anything you can encourage us to look at in this microeconomic reform space? I know you’ve commented on it in general terms before. Is there anything that we should focus on in energy, in labour, capital markets, that would make your job easier?
Philip Lowe:
Over time, expansion of capital stock that produces cheap, reliable energy will help. How you do that, I don’t know. But it must be true, again – the principle of cheap, reliable energy. We need the capital stock to be put in place in the country to deliver that. So whatever you can do in this place to help, I’d welcome that.
Lowe on the impact of Ukraine war on Australia’s inflation
The LNP senator then moves on to energy. In particular, people blaming Russia’s invasion of Ukraine.
Matt Canavan:
Just on the energy side of things – how much has the disruption in energy flows resulting from the war in Ukraine contributed to inflation over the past year now, almost?
Philip Lowe:
Well, substantially. At one point, the price of petrol – I think the annual rate was up 30%. That makes a big difference. And the sky-high prices of gas and coal in Europe flowed through back into our domestic market. That’s been a first-order issue. But it hasn’t just been energy. It’s been food and a lot of the supply chains. It’s worked its way through. The more positive story here is we’re through the worst of that.
Canavan:
I mean, if the removal of energy flows from Russia can have such an impact on Australian inflation, how much impact will come from the government’s decisions causing investments in gas in Australia to be deferred? How much impact will that have?
We’ve seen over the past month major investments in Queensland, in Victoria, deferred as a result of the government’s changes to – or interventions in – energy markets. I’m not going to ask you to comment on those interventions. I’m just saying, given that that’s happened – it’s a fact that those investments are not proceeding – how much of an impact on lower energy flows in Australia will that have on inflation?
Lowe:
It’s not my area of expertise, and I think it’s really a medium-term issue. If there’s less investment there, hopefully there’s more investment somewhere else.
Canavan: You mean in Australia?
Lowe:
Australia, or elsewhere around. This is one of the issues I highlighted in a speech last year – the existing capital stock to produce energy is depreciating. And we’re not kind of reinvesting in existing capital stock. We’re investing in new capital stock. I don’t know how that’s all going to balance out, but…
Canavan:
I’m just a little confused. There has been a lot of commentary on the Russian situation, and you’ve referred to it here and before, and so has the Treasury secretary, referring to it endlessly. So much focus on what Vladimir Putin’s doing. But then – how has it played out into interest rates and money policy settings. But almost no interest on how it would impact in Australia – wouldn’t it have more impact on Australia’s inflationary environment? This is a perfectly reasonably question.
Lowe:
These investment decisions are multi-year things, and so will play out over multiple years, and it will depend upon how much other investment takes place in other forms of energy. Next year, in 2024, the government’s recent initiative will reduce inflation by around 0.5%. That’s within our kind of normal forecasting horizon. I think the issues you’re talking about are important. But they’re really beyond the next 18-24 months.
Matt Canavan continues:
How important, then, in that context – there’s obviously a risk, as you’ve recognised. There’s a risk that at least some businesses fail, and people lose their jobs, as we seek to have a landing, soft or otherwise. How important is it, then, to have flexible labour markets in that environment, such that businesses can respond to the changes that are caused by a higher interest rate environment?
Philip Lowe:
Businesses need to be able to respond both in headcount and hours worked. Hours worked has become an increasingly important flexibility that businesses have. It’s beneficial to retain that. But the general principle has to be right, doesn’t it? If the business environment’s uncertain, businesses should have flexibility.
…And I’m not going to comment on whether the changes that have been made impair or enhance that.
Matt Canavan:
Just drilling down to the labour situation there – and, look, I have been critical of some of your commentary in the past, but I understand that you have a tough job to do right now. One of the potential consequences of these tough decisions you’re making is that it may force some businesses to the wall. We’ve spoken about mortgages and households. And that will, of course, lead people to lose their jobs. Has the Reserve Bank, at this stage, looked at what will potentially impact on bankruptcies on interest rates?
Lowe:
We don’t forecast the bankruptcy rate. It has been very, very low. During the COVID period. And it’s risen a little bit, but it’s still, in historical terms, low. How many business failures we see will ultimately depend on how the economy grows. Our central forecast for growth is 1.5% for this year and next. If we can get that, then some businesses will find things difficult, but I don’t think it’s going to be a major problem.
…If the economy contracts, then businesses are going to find things more difficult. But that’s…
Canavan:
And people will lose their jobs too.
Lowe:
And people will lose their jobs. And it’s… ..it’s possible – we’re aware that that’s a risk, and some people criticise the bank board for meeting every month. But at the moment, I’m glad we meet every month, because we can assess the data, we can look at a very high frequency at what’s going on.
At turning points, it’s really valuable to meet frequently, and we can be responsive.
LNP senator Matt Canavan is up now, and despite his penchant for photo shoots with coal dust smeared on his face, the good senator is actually an economist. (First class honours in fact He worked at the Productivity Commission and KPMG before he became a senator and retconned his image as a Working Class Man (TM))
Canavan:
I noted your comment earlier about investments that can help increase the productive side of the economy. Just as a general point of view, are policies that help expand productivity disinflationary, if you like? Do they help moderate inflationary pressures?
Philip Lowe:
Obviously it depends upon the specifics. But in general, yes. If you can expand supply, then it helps. If we can increase competition, that would put downward pressure on prices. If there are more workers available and you increase labour supply, that helps. Expanding the supply side in the short run puts downward pressure on inflation. And in the long run, makes the pie bigger. If you’ve got a bigger pie, your job’s going to be easier too.
Canavan:
That’s exactly right. And getting more specific, we’ve had a period of relatively low inflation – decades of it. To what extent do you think the microeconomic reforms of the past have contributed to that relatively subdued inflationary environment?
Lowe:
I think they were incredibly important and they were also important to expanding the pie. One of the reasons the Australian economy did so well over many decades was that we had a series of reforms that made us more competitive, made the economy more dynamic, and that delivered stronger growth. So the pie was bigger and developments on the supply side – not just in Australia, but globally – China was obviously an important part here – supply-side developments made the job of central banks much And they also expanded the pie. So this is a call that I’ve often made – is we need to focus, refocus, on expanding the supply side.
Canavan:
With that in mind, in the past year, we’ve seen the government re-regulate labour, and now energy markets. If removing restrictions on the economy helps subdue inflation, wouldn’t reintroducing restrictions in these very important markets add to inflationary pressures?
Lowe:
Again, it depends upon the specifics. I don’t want to be drawn into the specifics of the IR legislation. But I know the Treasurer has said that he’s got the 5-yearly review of the Productivity Commission, by the Productivity Commission, on his desk. It’s got more than 1,000 pages, and he plans to release that in March or April. And I hope that’s going to give us some new ideas on how to expand the supplied side and make the economy more flexible. I expect we’ll talk about the need to invest in people, in technology, in energy. And better delivery of government services. So I think – I’m hoping that that 5-yearly review re-energises the discussion about productivity and enhancing supply. We’ll see.
