Annual report 2005-06

Governance and implementation arrangements will be critical to the success of the Council of Australian Governments' new National Reform Agenda, according to the Productivity Commission. Further work and an ongoing commitment from all governments are required for the potential economic benefits of the NRA to be realised.

In its annual report, released today, the Commission looks at the scope of the NRA and how it measures up to Australia's reform needs. It finds that a promising foundation for reform has been laid, but that more remains to be done.

Productivity Commission Chairman, Gary Banks, said ‘the National Reform Agenda is wide-ranging and ambitious. If implemented well it could yield substantial economic benefits to Australians. However, some key elements that will determine the success of the reform program still need to be settled.’

The Commission identifies three matters that it sees as essential to securing future progress:

• Governments must agree on a robust governance framework that provides effective oversight and independent monitoring of their progress in delivering reform.
• Effective implementation arrangements will require the establishment of agreed outcomes, specific action plans and milestones.
• Financial arrangements between the Commonwealth and States should recognise not only the fiscal revenue gains from reforms, but also different expenditure requirements, including the need to address transitional issues and facilitate adjustment.

The Commission observes that how well these challenges are resolved will shape the ability of the NRA to deliver the significant gains that are potentially available from a further round of nationally coordinated reform.