Business backs Rudd's productivity goals

Kevin Rudd's goal to make a greying nation more productive has won the backing of
business and seniors.
But it could prove to be a tough political task.
As the population ages, future governments will struggle to fund services unless
they put their budgets deeper in the red, the prime minister says.
To solve this problem, Mr Rudd wants to boost average productivity growth from about
1.4 per cent to two per cent per year during the next four decades.
Doing so by 2050 would make every Australian $16,000 better off each year, he said
in the first of a series of speeches to mark Australia Day.
Fellow baby boomer Tony Abbott was not impressed, with the federal opposition leader
labelling Mr Rudd's call as "all talk and little if any real action".
"It was typical Rudd - talking about what we needed to do, but not talking about how
we were going to do it," he told Macquarie Radio on Tuesday.
"Talking about what would happen by 2050 when Mr Rudd will be long gone, not talking
about what he's going to do this year - that might actually make a difference."
Any reform to boost long-term productivity could be a tough political task, Access
Economics director Chris Richardson warned.
Many areas of economic reform would "involve cheesing off select groups of voters".
Australian Industry Group chief executive Heather Ridout said working longer was one
way to boost productivity, endorsing the government's decision to raise the pension
age to 67 from 2023.
A lobby group for older citizens, National Seniors, agreed with the need to keep
Australians working longer.
"Boosting participation rates is the best way to combat the looming skills shortage
and to do this, government and employers need to change their attitudes to older
workers by stamping out age discrimination," spokesman Paul Versteege said.
As opposition leader in 2007, Mr Rudd criticised the Howard government for allowing
productivity growth to falter, after hitting two per cent in the early 1990s.
Productivity growth peaked after the Hawke and Keating governments cut tariff
barriers and deregulated the labour market.
The Australian Chamber of Commerce and Industry says more labour market reforms and
a more competitive tax system would help productivity growth return to its peak.
All governments, including "lagging state and local governments" needed to be locked
in to the reform process, ACCI economics policy director Greg Evans said.