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How we operate

There are three features of the Productivity Commission's structure and operations which underpin the effectiveness of its contribution to public debate and policy formulation.

  • Independence
  • Transparency
  • Community-wide perspective.

The Commission is independent

The Commission operates under the powers, protection and guidance of its own legislation. Its independence is formally exercised under the Productivity Commission Act through the Chair, Deputy Chair and Commissioners, who are appointed by the Governor-General for fixed periods.

The Productivity Commission has its own budgetary allocation and permanent staff, operating at arm's length from other government agencies. While the Government largely determines its work program, the Commission's findings and recommendations are based on its own analyses and judgments.

The Commission reports formally through the Treasurer to the Australian Parliament, where its inquiry reports are tabled. However, with the statutory requirement to promote public understanding of policy issues, its reports and other communications activities are also directed at the wider community.

Its processes are transparent

The Commission's advice to government, and the information and analysis on which it is based, are all open to public scrutiny. Its processes provide for extensive public input and feedback through hearings, workshops and other consultative forums, and through the release of draft reports and preliminary findings.

It adopts a community-wide perspective

The Commission is obliged under its statutory guidelines to take a broad view, encompassing the interests of the economy and community as a whole, rather than just particular industries or groups. Environmental, regional and social dimensions of its work are also carefully considered, informed by public consultation and the Commission's own research capability.

The Commission's legislative 'instructions'

  • Improve the productivity and economic performance of the economy.
  • Reduce unnecessary regulation.
  • Encourage the development of efficient and internationally competitive Australian industries.
  • Facilitate adjustment to structural change.
  • Recognise the interests of the community generally and all those likely to be affected by its proposals.
  • Promote regional employment and development.
  • Have regard to Australia's international commitments and the trade policies of other countries.
  • Ensure Australian industry develops in ecologically sustainable ways.

Government’s expectations

The Government released its Statement of expectations for the Commission in November 2023. It outlines the Government’s expectations of how the Commission will renew and refocus its objectives by:

  • taking into account the Government’s policy priorities
  • being responsive to changing economic environments
  • enhancing its relationships with all Governments
  • bolstering external engagement and communication methods
  • strengthening internal culture and capabilities, and organisational governance arrangements.

Statement of intent

In February 2024, the Commission responded to the Government’s Statement of expectations with a Statement of intent. The Commission’s forthcoming corporate plans will integrate performance measures, and forthcoming annual reports will assess the Commission’s performance against these measures.