Australian businesses and individuals are now held back by over 30,000 onerous licenses, permits and approvals.
While a competitive federalist system is fundamental to the strength of Australian democracy, one of the drawbacks is the complexity and cost when business operate in more than one jurisdiction.
Unfortunately very few red tape reduction strategies have been undertaken by Council of Australian Governments (COAG) since 2012, despite the need being a key part of the reform agenda.
At the next COAG meeting Australian Treasurers will be focusing on a new competition and productivity enhancing reform agreement. If the Treasurers are serious about productivity reform they should look first to cutting unnecessary red tape.
Australia will only become a ‘seamless national economy’ if the next Australian government redoubles efforts in seeking mutual recognition of approvals and permits between states and territories.
Mutual recognition arrangements would bring harmony and coherence, thereby lifting some of the hefty burden and helping to unleash the some $176 billion in foregone economic output due to red tape.