New research released today by free market think tank the Institute of Public Affairs calls for a complete overhaul of Australia’s regulatory system in order to slash red tape and boost business investment in Australia.
The Senate Standing Committee on Economics is currently undertaking an inquiry into impediments to business investment in Australia.
“Business investment as a percentage of GDP is lower today than during the economically hostile Whitlam years. It is near crisis-level lows. The key reason for this is red tape and overregulation,” said Daniel Wild, Research Fellow with the Institute of Public Affairs.
“We don’t need more reviews. We need urgent action. A complete, radical, and immediate overhaul of Australia’s broken regulatory system is needed will cut red tape and boost business investment.
“Australia’s regulatory system is broken. Every year red tape costs Australia workers, families, and businesses $176 billion every year. This represents forgone human potential: all of the businesses that never started, the jobs never created, and the dreams, which go unfulfilled because of red tape.
“Projects from large iron ore mines, to setting up a café, to doing home renovations, are met with unnecessary and often petty bureaucracy that slows or discourages the undertaking of such projects. Australians have simply had a gutfull of burdensome red tape.”
The research paper provides five principles policy makers should follow when implementing new proposals to minimise the amount of associated red tape. These include:
• Eliminate the need for approvals, and replace with an inspection and reporting regime.
• Embrace market-based solutions.
• Harness the benefits of economic competition.
• Follow subsidiarity by decentralising regulatory authority.
• Minimise interaction with government.
The most substantial proposal is to remove the need for workers, business, families, and community groups to obtain permission from government before undertaking a project. Instead, regulatory enforcement should be achieved with periodic, risk-based inspections.
Implementation of these principles would unchain millions of Australians from unnecessary, costly, and time consuming red tape. All Australians, from farmers to miners to tradies to teachers and nurses stand to benefit from the proposed changes.
“If the government was serious about boosting investment, it would immediately commit to a radical overhaul of Australia’s broken regulatory system.”
“Australians have better things to do with their lives than satisfying the arbitrary and petty demands of unelected bureaucrats and regulators,” said Mr Wild.
Download the report here.