Industry welcomes government's productivity push

The Actuaries Institute and the Australian Banking Association (ABA) have welcomed the measures taken by the government to tackle structural productivity concerns in the Australian economy.

The ABA said the Federal Budget has laid the groundwork to push productivity across financial services.

ABA chief executive Simon Birmingham said increasing the focus on improving productivity and regulatory reform would be crucial to supporting business investment, creating jobs, lifting living standards and driving stronger economic growth.

"At a time when Australians continue to face cost-of-living pressures, lifting productivity is essential to sustainably growing wages and improving living standards," Birmingham said.

"Budget measures that support productivity growth across the financial services sector are vital to maintaining a strong and competitive banking system."

ABA also welcomed the projected improvements to the overall budget position through lower deficits and a more sustainable fiscal trajectory.

"The government's broader productivity package aimed at reducing red tape and regulatory costs is encouraging, alongside reforms that incentivise business investment and innovation, such as making the instant asset write-off permanent," Birmingham said.

"However, productivity reform must not be set and forget. An ongoing and ambitious reform agenda is required to deliver long-lasting productivity improvements."

The Actuaries Institute also acknowledged the steps announced in the budget to begin tackling structural reforms aiming to improve resilience and strengthen the economy over the long term.

"While there are constraints and competing priorities, the government is taking meaningful steps in this Federal Budget to address today's long-term challenges," Actuaries Institute chief executive Elayne Grace said.

"Sustained focus will be needed to build Australia's long-term resilience to cope with mounting economic, environmental, geopolitical and social stresses."

The government said it will reduce regulatory costs by $10.2 billion each year, boost long-run GDP by around $13 billion a year and promote $400 million more investment in R&D by young firms each year.

"Our reforms make substantial progress on 13 of the 17 reform areas identified in the Productivity Commission's inquiries into Australia's productivity agenda, progressing the majority of near-term recommendations for the Commonwealth," Treasurer Jim Chalmers said.