Productivity Commission reforms to be led by new chair

Brandon How

Treasurer Jim Chalmers has appointed a deputy secretary from the Victorian Department of Treasury and Finance Chris Barrett as the new chair of the Productivity Commission.

Announcing the appointment on Monday, the Treasurer said Mr Barrett would lead a reform of the Productivity Commission to include a refocus towards the “vast, industrial, and productivity opportunities of the energy transformation”.

Mr Barrett was chief of staff to Labor Treasurer Wayne Swan between 2007 and 2010, and was a senior adviser to then Labor federal opposition leader Kim Beazley between 1996 to 2001.

Mr Chalmers also served in Mr Swan’s office between 2007 and 2010, as deputy chief of staff.

Mr Barrett is currently a deputy secretary at Victorian Department of Treasury and Finance in the Economic Division. He holds a Master of Public Policy from Princeton University having graduated first in his class, and has as a Master of Arts and a Bachelor of Commerce from the University of Melbourne.

He has also served as Invest Victoria’s chief executive, European Climate Foundation executive director for finance and economics, and as Australia’s Ambassador to the OECD.

Mr Chalmers confirmed that the federal Treasury has undertaken months of “detailed and comprehensive” consultation to develop a reform agenda for the Productivity Commission.

He wants the Productivity Commission to focus on investing in three areas: human capital, the energy transition, and in adapting and adopting new technologies. He also called for the PC to develop a “more modern approach to data”.

“We see the PC as a really crucial institution as we try and get productivity growth going again in our economy, as we try and reform and renew our institutions,” the Treasurer said.

While not committing to a release date for the PC reform agenda, Mr Chalmers said he would work with Mr Barrett to finalise it over the next few “months rather than years”. Mr Barret will begin his five-year term in September.

Incoming Productivity Commission chair Chris Barrett. Image: LinkedIn

The Treasurer said Mr Barrett was appointed through a “rigorous, merit-based process, which involved interviews with two departmental secretaries and the Australian Public Service Commissioner as well”.

Work to develop a reform agenda for the PC was first reported in January, when the process was said to have been underway for months.

The PC has been highly critical of the Labor government’s ambition to develop a domestic manufacturing capability.

It has warned that pursuit of sovereign capability could lead to rent-seeking and large industry development packages could entrench inefficient industries, suggesting that the cost of supporting a local battery cell manufacturing industry could “outweigh the benefits for GDP and economic growth”. The latter advice was rejected by industry stakeholders.

Last September, the PC placed a greater emphasis on business innovation policy focusing on adoption and diffusion of new technologies and ideas rather than funding novel developments.

The Treasurer denied claims that his motivation for appointing Mr Barrett was to drive economic advice more in line with the government’s economic agenda.

The Treasurer also refused to give a “performance review” of the PC, stating that the appointment of Mr Barrett was a “forward facing opportunity”.

“We have made it clear that when it comes to productivity, we have a range of priorities, it may be that the PC has other priorities under Chris’s leadership and that’s fine as well. I want to strengthen the PC, not diminish it and I see this appointment in that light,” the Treasurer said.

Mr Chalmers thanked outgoing PC chair Michael Brennan for his five years of service, in which time he delivered more than 20 reports. He noted that he has “a lot of respect and regard” for Mr Brennan, who had also previously served as Victorian Department of Treasury and Finance deputy secretary of the Economic Division.

While calls for reform of the PC has been ongoing for years from economists, unions, and other interest groups, the Treasurer acknowledged that “there’ll be some people that say leave the PC exactly as it is, others will say abolish it entirely”.


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