“A different kind of budget”: Academics and business groups call for an economy that works for everyone, post COVID-19

As we approach an unusual budget time in the middle of an unusual year, a consortium of academics, business organisations and communities is calling for a shake-up in the very way the economy is shaped.

A collaboration between the University of Sydney’s Policy Lab and partners including United Workers Union, Victoria Trades Hall, the Australian Conservation Foundation and Climate Justice Union, as well as several other business and community groups, has led to the creation of a new economic plan, and a report titled A Real Deal.

The plan addresses the “interconnected health, economic, race and climate crises revealed by COVID-19”, and calls for a reimagining of how the economy and the Australian government works at its core.

“The pandemic is an opportunity to do a different kind of budget,” project economist Dr Gareth Bryant said in a statement.

“What we are calling for requires big change, not just big spending,” he added.

“Each of our partner organisations are convinced that the traditional economic approach will only benefit those who have been least affected by the COVID-19 crisis.”

For project lead Dr Amanda Tattersall, it’s not about asking how much the government should spend. It’s about asking whether that spending will go far enough, she said in a statement.

“We should also question who gets to make these crucial decisions at this decisive moment in our history. We want to see as many people as involved in shaping our country’s future.”

Investing in people who need it

The report lays out five new benchmarks for building an economy and government that works, both for Australian people, and for the planet.

First, the report calls for public investment that is more attuned to the state of the economy, not only its size.

Throughout the pandemic, many governments around the world have shown they can spend big in order to address urgent issues, “when they choose to”, the report says.

Now is not the time to reduce that spending, it said. But, simply increasing spending is not enough, either.

That spending should be targeted towards the people who need it most, to foster long-term resilience.

“Fiscal policy that is only attuned to the size but not the shape and structure of the economy will not reach the people or places that need it the most,” the report says.

Tackling injustice for good

The report also calls on the government to tackle social inequalities and injustices that “must be addressed for good”.

The COVID-19 experience “has not been equally shared”, it says, with the financial impacts and the lockdown restrictions being shaped by economic inequalities.

Otherwise innovative policy has failed to recognise or address this.

“We need policy that addresses the root causes of marginalisation, not only to buoy us through this crisis, but to equip us to deal better with other equally foreseeable crises, including climate change,” it says.

Who is the economy for?

Third, the report called for big-vision thinking for an economy that serves more people.

“Rather than achieving policy reform or aggregate spending goals for their own sake, what is needed is a clear vision of who and what our economy is for,” the report says.

This means abandoning ‘business as usual’ and focusing on six key areas: First Nations sovereignty, care, climate, work, justice and citizenship.

Each of these will be “essential ingredients” in a system “that delivers multiple wins for people and the environment”, the report says.

Community involvement in decision-making

The consortium calls for people to be active participants in decisions that affect them, and input from those people who have lived experiences of the issues being addressed.

The voices of people who really know what their communities need have been notably missing in COVID-19 conversations, the report notes. That’s not how good policy comes about.

“Achieving long-term outcomes that strengthen and build resilience in communities requires attention to how policy is created,” the report says.

Collaboration is key

Finally, the report calls for collaboration between the state, the business community, unions, local community groups and local authorities.

Representatives should be coordinating across various issues and challenges, allowing long-lasting change to actually come about, it says.

Again, the COVID-19 crisis has only served to highlight this point.

“At the heart of the best of our reactions to the COVID-19 crisis has been a capacity to collaborate.

“In contrast, where policy has not involved communities as genuine partners it has been fragile and short-lived.”

A turning point

The COVID-19 crisis has exposed cracks in the current system, the consortium states.

But, it’s also turned everything we know on its head, and provides an opportunity to shake up the status quo of the Australian economy, and to create a system that works for everyone, all the time.

“The pandemic demanded policy responses that suspended many of the usual political and economic constraints and opened up new social possibilities.

“But the deal currently on offer to people in Australia has fallen short of what is needed to address the present emergency and to build a better future,” the report says.

“We are at a turning point.

“The risk now is that rather than embracing the opportunities presented by the current moment for positive change, the post-COVID-19 world will be shaped by faux deals that are too limited in the issues they tackle, the people they involve or the scale of their ambition for change.”

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