Navigating turbulent times

Over the past few weeks, I’ve spent some time in Canberra, speaking with the heads of the Australian public service and senior parliamentarians. I’ve felt and shared a sense of disquiet – a worry rippling under the surface about where exactly the world is headed.

We might all be seeing it differently, but I’ll confess I have wondered, at one or two points, what the future is for careful, thoughtful approaches to the exercise of public power – even the hard-won successes of post-war liberal democracy.

So, I wanted to take this opportunity to talk about three enduring propositions of Australian public policy that I return to, when the sound and fury is all a bit much, when it feels like my attention is being drained by something untenable being done or said somewhere.

Thefirst is that problems that have bedevilled us for a long time – complex problems such as how to increase real incomes in Australia – do not have simple solutions. If they did, we would have implemented them. 

Even reforms that look simple in hindsight are not so in the making. They take work: 

• understanding the problem;
• interrogating the evidence from other countries, from history, from science;
• testing the design of solutions for unintended consequences;
• making the case for them in a way that can be broadly understood;
• standing up to vested interests; standing up even to public sentiment when it is the right thing to do;
• and then, implementation, which brings its own list of demands.

Good public policy reform is never careless. It is not a vibe, and it’s not about moving fast and breaking things – not when people’s lives depend on good public administration.

The second enduring proposition is that it has always been human ingenuity that has underpinned progress: be it productivity, in the language of the economists, or prosperity, as is used more broadly. 

And the research shows that the best environment to support that over the long term is one made up of broad-based inclusive institutions – those that enable a broad section of the population – men and women, people of all backgrounds – to invest in their own education, professions, and businesses – and where a working life is a decent, healthy life.

Those are the fundamentals, and here in Australia we have done a good job of this over the past 50 years: opening up our economy and society to the world, while constructing and maintaining a strong safety set and a robust regulatory environment.

And we have navigated the crises of the past five years without the deaths, job losses, and bankruptcies seen elsewhere in the world. Despite the relentless negativity we see in parts of the media, we do not bear the same scars as elsewhere.

We are a lucky country, but not just a lucky country. We are a remarkable country, when you look at:

• our people, whose backgrounds span the world;
• our extraordinarily continent, its ancient history, and its natural endowments; and
• our proven ability to punch above our weight in science, medicine, sport, and the arts.

We can and should be optimistic that we can achieve amazing things in this country.

The third proposition is that we have work to do and no time to waste.

We have challenges that we must confront. As a small, open economy, we are exposed to global shocks and to moves away from international rules and institutions. We are increasingly exposed to natural disasters. We can’t afford to be riven apart – certainly not by divisions built up around cynical tactics to win votes. We need to make good collective choices about the kind of future we want to build – that is the point of elections, that is the point of public policy.

One cleavage we do need to worry about is intergenerational. Our intergenerational compact is fraying – and I am proud that this is an area where Grattan Institute leaders have been sounding the bell since the Institute’s early days. Intergenerational equity is the litmus test of good public policy, and it is a test we are failing. 

• Our population is ageing, and this represents the biggest call on our public services and our budgets. We have long known this is coming, but as demand has grown and the tax base has not, the key reforms we need – tax reform and health reform – have remained stuck in the too-hard basket.
• We have mucked up our housing system across three decades and multiple levels of government, making it unaffordable for young, working Australians to live where their jobs are.
• We have both an obligation and a tremendous opportunity to decarbonise our economy and support the world to get to net zero, but still no bipartisan foundation for the transition, still an apparent willingness to push the costs of policy failure on to our children.
• And, despite women in Australia being among the most highly educated in the world for some time now, our working lives remain deeply gender segregated, and the distribution of unpaid work hugely uneven, more so than many of our peers – and this is not unrelated to women’s financial and physical security in this country.

But in tackling these challenges, we are not starting from scratch.

Recent years have been hard for many people in this country, so it can be easy to lose sight of the progress we have made – but we have made progress. 

Just in terms of areas where Grattan has researched and advocated:

• a clear focus on increasing housing supply, and in particular, greater density around existing infrastructure; 
• education reforms across multiple states to embed evidence-based teaching practices;
• reforms to the NDIS to put it on a sustainable footing – just the start, but we are on the right track;
• a full employment economy – which sets up brighter futures for younger workers and those otherwise at the margins of the workforce – and progress on the gender pay gap, particularly for skilled but low-paid feminised workforces;
• and we are finally bending the curve on carbon emissions.

And we have reasons to be optimistic that Australia today is better positioned than most countries to get to the stuff that’s been sitting in the too-hard basket – a more manageable fiscal position, strong public institutions, and less polarisation in our politics.

Like so many others across the country – public servants, the private sector, researchers, and experts – our response here at Grattan Institute to the times we live in is to keep working at what it will take – what it will actually take – to see a better, more prosperous Australia.

We look forward to deeper connections as we take that work forward. We at Grattan are very proud of our long-standing home at the University of Melbourne, one of our founding members. And this new partnership with University of Technology Sydney – Australia’s top young university – is a fantastic complement to that.

Thank you to the UTS Business School for this partnership – we couldn’t ask for a more perfect space for our Sydney base.

This is an edited text of our CEO Aruna Sathanapally’s remarks on 18 February 2025 at the official opening of Grattan’s new Sydney office, at UTS.