Productivity summit proves disappointing for unions as Labor dismisses ACTU's ideas

Sally McManus has been feeling a little lonely around the economic reform roundtable this week.

"Sometimes we feel a bit outnumbered," the ACTU secretary told the ABC at the midway point of this three-day gathering. "Obviously there's a lot of business representatives there."

There's still a day to go, but it's clear this roundtable is not proving as successful for the unions as the Jobs and Skills Summit held in Labor's first term.

Back then, the ACTU walked away with a show bag full of goodies, including multi-employer bargaining, much to the chagrin of business groups, which have been grumbling ever since.

This time McManus and ACTU president Michele O'Neil again came armed with a whole bunch of big ideas on tax, artificial intelligence, a shorter working week, and a levy on businesses to fund employee training.

None have taken off.

So much for a union 'stitch-up'

The training levy idea was described by one of the business organisation representatives as a "crock of s***".

"I wouldn't say that it had a lot of fans amongst business," McManus conceded.

The ACTU's call for a new artificial intelligence act, and "mandatory enforceable agreements that would compel employers to consult with their staff" before AI is introduced to workplaces, hasn't won many fans either.

While keen to strike the right balance on AI, several cabinet ministers have privately made clear a new AI act is a non-starter. "I think it might be a bit lonely on AI," McManus predicted before heading into the roundtable session on the topic.

The idea of a four-day working week met short shrift too. The prime minister was immediately dismissive. "I think a lot of people would like to have a five-day working week," he noted, insisting the government had "no plans" to pursue the ACTU's idea.

So much for the union "stitch-up" predicted by the Coalition ahead of this roundtable.

The ACTU is yet to score a victory. The treasurer's priority in this term has shifted from tackling cost of living to productivity. Jim Chalmers made that clear the morning after the government's emphatic election win. And Labor is not finding productivity solutions in what the union movement is pushing.

In its second term, Labor is more willing to say no.

Consensus on generational inequity

All is not lost, however, for the ACTU. There's one day to go in this roundtable and the final topic is tax.

It's here that McManus is holding onto hope.

The government hardly rushed to embrace the ACTU's plan to wind back negative gearing and capital gains tax breaks, but McManus detects some momentum at the roundtable.

"The biggest thing that people agree on is the need to address intergenerational inequality," she said.

It's true there's growing support for something to be done about the heavy income tax burden being shouldered by younger working age Australians, who feel locked out of the housing market, while predominantly older property investors enjoy the bulk of tax breaks.

Independent MP Allegra Spender and former treasury secretary Ken Henry (both roundtable attendees) have spoken of the need to urgently tackle this inequity.

A Treasury issues paper released for the roundtable also unsubtly pointed to this problem. It highlighted how the reliance on income tax was only forecast to grow, while the highest income earners were the overwhelming beneficiaries of existing tax breaks.

Two weeks ago, the prime minister shot down expectations of major tax changes any time soon when he declared: "The only tax policy we're implementing is the one we took to the election." 

He's not about to spring big surprises on the electorate.

But it wasn't a never, ever on tax.

As he opened the roundtable proceedings on Tuesday, Albanese gave an insight into his cautious approach to reform.

"I think that political change, whether it's in the economy, social policy or the environment, is likely to be more successful and more entrenched and more lasting when people come with us on that journey," he said.

The roundtable could be the start of a journey on tax that leads to the next election.

Further steps might involve a more focused tax review, a Treasury options paper, and a greater effort to build public consensus around the problems that need fixing and possible solutions.

That won't satisfy those who want more urgent action and for Albanese to spend his political capital now. Nor will it please the opposition, which reckons all the "hoo-ha" around this roundtable is so far producing a ho-hum result on cutting red tape.

But if this three-day event at least gets the ball rolling on more substantial tax reform, Sally McManus won't be feeling so lonely.

David Speers is national political lead and host of Insiders, which airs on ABC TV at 9am on Sunday or on iview.