Mutual Recognition Schemes Advance Seamless Economy

The mutual recognition schemes linking Australian states and territories and New Zealand have contributed to the creation of a seamless national economy in Australia and a single economic market across the Tasman, according to a report by the Productivity Commission.

This, and other findings are contained in a review of the schemes the Commission presented to Australian Heads of Government and the New Zealand Prime Minister in early February 2009. In an assessment of the two main mutual recognition schemes - the Mutual Recognition Agreement (MRA) and the Trans-Tasman Mutual Recognition Arrangement (TTMRA) - the Commission found that they brought benefits through increased mobility of labour and greater movement of merchandise between jurisdictions.

Commissioner Judith Sloan noted that 'mutual recognition retains the scope for regulatory competition between jurisdictions while removing unnecessary barriers to the movement of goods and workers.'

The Commission found, however, that ambiguities and omissions in the legislation create frictions in the operation of the schemes. Moreover, a lack of awareness of mutual recognition means that businesses, individuals and regulators do not always use the schemes fully or appropriately.

The Commission is recommending a suite of administrative, regulatory and legislative changes to mutual recognition arrangements which, if implemented in the near-to-medium term, would reinvigorate the schemes and allow them to reach their full potential.