There’s an old Slim Dusty song I’ve always enjoyed that I can’t help but recall when we speak about Australia finding itself at a major economic and demographic crossroads.
In the song, Slim sings that the ‘road to destruction is paved with good intent’. He warns the listener that they shouldn’t ‘fool around or you might find a lifetime has been spent.’
But most importantly, Slim warns that you should “never laugh in the face of father time.”
No doubt these are wise words everyone would agree you should live by.
And I don’t pretend to know what spurred Slim Dusty to pick up his guitar and sing these words – it definitely wasn’t macro-economic public policy – but there’s a moral in this story for our nation.
Federal Treasurer Joe Hockey recently released the latest Intergenerational Report, which projects what the Australian population, economy, and budget could look like in 40 years.
It provides the information we need to prepare for the future and ensures we are well placed to address the demographic changes that Australia faces.
The picture it paints of Australia in 2055 is a nation dependent on the action we take in 2015 and beyond.
It will be a time where there will be a higher than ever number of elderly people across the Surat Basin, as well as, with correct planning, the necessary productivity enhancing infrastructure to provide the nation with earnings to the support the population.
It is clear the Australia of 40 years ago was forward thinking enough to provide the high living standards and economic security we have all since benefitted from.
We only have to consider how far we’ve come in the past four decades – average incomes have doubled in real terms and this increased wealth has been broadly shared across the community.
Today, Australians produce twice as much in goods and services for each hour they work compared with around 40 years ago.
Australians are living longer and we have one of the longest life expectancies in the world – we rank equal first along with Iceland in terms of male life expectancy and fifth in longest life expectancy for women.
Over the next 40 years the Australian economy is projected grow at 2.8 per cent per annum, slightly less than the 3.1 per cent per annum we saw over the past 40 years, but still a level of growth that would see Australia’s prosperity rise significantly.
It is therefore essential we continue to look at our national debt.
We are currently living beyond our means. The Australian Government is spending over $100 million per day more than it collects and we are borrowing every day to pay for this shortfall, so we are living beyond our means.
Continuing to work at keeping spending under control will ensure we can deliver the services the community needs and expects to improve Australia’s capacity to respond to future challenges and opportunities.
It is essential we continue this task today, as we confront the declining rates of workforce participation in the coming decades.
The Intergeneration Report explains that we are on the verge of an ageing population boom, which will require more money to be dedicated to health and social services.
In 1975, there were 122 Australian centenarians. Today there are around 4,000. And in 40 years’ time there will be around 40,000 people aged over 100.
With social services spending currently about $150 billion per year, or about one-third of the national budget, there is a clear need for a debate about how we ensure this area is more sustainable in the long term.
The Intergenerational Report predicts that more than one-in-five Australians will be aged 65 and over by 2054-55.
It is with this backdrop that the gas industry ramps up across the Surat Basin and we look to finalise the related productivity enhancing infrastructure that will generate wealth for the nation.
This is a conversation we need to have immediately and the Intergenerational Report is a good starting point.
Because there is one thing I am certain about – if we don’t lay the foundations today, father time will be wiping the smile off our faces tomorrow.