Andrew Leigh

NON-COMPETE CLAUSES: PREVALENCE, IMPACT, AND POLICY IMPLICATIONS

Joint Treasury – e61 Institute Webinar, Sydney

Wednesday, 18 October 2023

I acknowledge that I am attending this webinar from the lands of the Ngunnawal People who are the traditional owners and custodians of the Canberra region. I also acknowledge the traditional custodians of the various lands across Australia on which others in this webinar are joining from, and any Aboriginal and Torres Strait Islander people participating in this webinar.

Thank you Dan for your introduction. In opening today’s webinar, I want to thank the excellent line up of speakers and welcome our international guests. I also want to acknowledge Australia’s e61 Institute for jointly hosting this event with Treasury. E61 has done a great job shining a light on the prevalence of non-compete clauses which has really kick started the debate here in Australia.

CHANGING THE WORLD, ONE COIN TOSS AT A TIME

Evidence and Implementation Summit, Melbourne
Wednesday, 11 October 2023

I acknowledge the people of the Kulin Nations as traditional custodians of the land and pay my respects to their Elders past and present. I commit myself to the implementation of the Uluru Statement from the Heart, which starts with voting Yes this Saturday.

I thank the Monash University, the National University of Singapore and the Centre for Evidence and Implementation for hosting today’s Summit. It’s terrific to see so many of you dedicated to closing the ‘know-do gap’– the gap between what we know and what we do.

The title of my presentation is ‘Changing the World, One Coin Toss at a Time’. I chose this title because the simple act of tossing a coin can help us get the evidence we need to address our most difficult problems. Heads, they receive the intervention. Tails, they’re in the control group. From there, we can establish a counterfactual and begin to evaluate what works and what doesn’t work.

Recently, at the National Press Club and the Australian Evaluation Society Conference, I’ve spoken about randomised trials, its origins in medicine and the need to embed evaluation in the work of government. I’ve spoken about social impact and how rigorous evidence can give us an accurate picture of program effectiveness. I’ve also spoken about how the increased availability of large, integrated administrative datasets can help us conduct evaluations more quickly and cheaply, making data and evaluation a match made in policy heaven. Today, I want to zoom out a little and discuss what best practice use of evidence looks like.

SPEECH

How COVID Changed the World of Data

Population Symposium
Australian National University School of Demography

6 October 2023
Canberra

I acknowledge the Ngunnawal people as traditional custodians of the ACT and recognise all First Nations people present today. 

I commit myself, as a member of the Albanese Government, to the implementation in full of the Uluru Statement from the Heart, which starts with voting Yes on October 14. 

Thank you to the Australian National University for hosting today’s Symposium and thank you for focusing your efforts on understanding the impact of the COVID pandemic on demography in Australia.

I want to preface my remarks by acknowledging the remarkable ability of the Australian Bureau of Statistics (ABS) and other government agencies to rapidly shift their operational focus during the pandemic.

Demographers deserve credit for helping guide governments, policymakers and the community through the COVID pandemic.

Today, I will tell the data side of the story.

COVID might have shrunk our worlds to frequent Zoom calls in which we took it in turns to remind each other ‘You’re on mute’.

But COVID also opened up a whole new world of data.

In the space of just a couple of years, we have access to more timely and frequent updates, new sources of data and greater integration.

I welcome the opportunity to talk about this extraordinary legacy, the lessons learnt and how we can build on it.

Rocking the demographic boat

The COVID pandemic was not only a rapidly evolving health crisis but an economic crisis too – the most severe economic downturn since the Great Depression (Kennedy 2022).

Restrictions to limit the spread of COVID saw a reduction in spending, business turnover, losses in jobs and hours worked, and supply chain disruptions (ABS 2022a).

By June 2023, the level of GDP is estimated to have suffered a cumulative loss of $116 billion compared to its pre-pandemic trajectory (Figure 1).

Figure 1. Australia’s GDP, actual and pre-COVID trajectory

Source: ABS 2023a and Treasury

The COVID pandemic rocked the demographic boat.

As shown in this chart, Australia’s population growth slowed to 0.1 per cent in 2020–21 – the lowest rate in more than 100 years (Figure 2).

Figure 2. Australia’s population growth and components of growth, historical and projected

Source: ABS 2023b and Treasury

Australia’s net overseas migration fell into negative territory for the first time since the end of WWII, with a net loss of 85,000 people in 2020–21 (ABS 2023c).

There was a larger than expected increase in deaths due to COVID and other causes – 10.9 per cent above what was expected in 2022 (ABS 2023d).

Births fluctuated in interesting ways. In the December 2020 quarter, nine months after the pandemic hit, births fell. We know that crises can make couples cautious about starting a family, and this drop likely reflected the uncertainty that many couples felt in the early months of the COVID lockdowns.

But then things turned around. In the March 2021 quarter – nine months after mid-2020, births hit an all-time high (ABS 2023c). We can’t be sure as to why this occurred, but it may be that couples felt a little less anxious about the future as the year unfolded. Lockdown boredom may also have been a factor. Border closures between states and territories reduced internal mobility. The number of interstate moves in the year to March 2021 was 30.2 per cent lower than in 2018-19 (ABS 2023c).

The pandemic also influenced where people wanted to live with an increase in net moves from urban areas towards suburban and regional areas (Figure 3) (Centre for Population 2020).

COVID doubled the net number of people moving to the regions.

You can see a break in the data series on this chart. It’s due to the pandemic’s impact on Medicare address information this series relied on, which I will get to later.

Figure 3. Net internal migration to regions outside capital cities, quarterly

Source: ABS 2023c and ABS 2021d

WHAT’S THE WORST THAT COULD HAPPEN? EXISTENTIAL RISK AND EXTREME POLITICS

EAGxAustralia Conference, Effective Altruism Australia, Melbourne
Friday, 22 September 2023

I acknowledge the people of the Kulin Nations as traditional custodians of the land and pay my respects to their Elders past and present. I acknowledge any First Nations people and businesses represented here today. I commit myself to the implementation of the Uluru Statement from the Heart, which starts by voting Yes on October 14.

Much of what we focus on in politics centres on immediate challenges. This week, I’ve participated in discussions about competition policy and randomised trials, community-building and economic dynamism. These are important issues for Australia’s future.

But the EAGxAustralia conference provides an opportunity to think about existential risk – about dangers not only to our way of life, but to our lives themselves.

In a busy life, it’s easy to confuse the improbable with the impossible.

What would happen if you decided to cross the road without checking the traffic? Odds are that you’d survive unscathed. But do it enough times and you’re likely to come a cropper.

That’s where catastrophic risk comes in.

START UPS, UPSTARTS AND COMPETITION

International Small Business Summit, Melbourne
Friday, 22 September 2023

I acknowledge the people of the Kulin Nations as traditional custodians of the land and pay my respects to their Elders past and present. I acknowledge any First Nations people and businesses represented here today. I commit myself, as a member of the Albanese Government, to the implementation in full of the Uluru Statement from the Heart, including voting Yes for a Voice to Parliament.

Thank you to the Small Business Association of Australia for hosting today’s summit. It comes at a time when our government is providing around one million small businesses with direct energy bill relief.

We’re also putting in place the Small Business Energy Incentive to help businesses with annual turnover of less than $50 million save on their energy bills.

We’re improving small business cash flow by halving the rate of increase of quarterly tax instalments for GST and income tax.

And we’re making it easier for small businesses with an annual turnover of less than $10 million to invest and grow through the $20,000 instant asset write-off.

Under the leadership of Small Business Minister Julie Collins and Treasurer Jim Chalmers, the Albanese Government is tackling cost pressures now and we’re laying the foundations for growth in the decades to come. Competition policy is central to both of those goals and that’s my focus for today.

COMPETITION AND ARTIFICIAL INTELLIGENCE

McKell Institute, Sydney
Wednesday, 20 September 2023

I acknowledge the Gadigal people, traditional custodians of the land on which we gather today. I pay my respects to their Elders, extend that respect to other First Nations people present today, and commit myself, as a member of the Albanese Government, to the implementation in full of the Uluru Statement from the Heart, which starts with voting Yes on October 14.

It’s always a pleasure to address the McKell Institute. New South Wales Premier William McKell not only taught my party that it was possible to win back-to-back elections; he also provided a model for how to govern in turbulent times. McKell became premier in 1941 – the year of Pearl Harbour – and governed until 1947 – through the end of the war and into the peace. Like Prime Ministers Curtin and Chifley, Premier McKell saw an opportunity to rebuild a nation that was stronger after the war than before. My thanks to McKell Institute CEO Ed Cavanough and your team for hosting today’s event.  

Not-So-Humble Beginnings

In 1955, a group of mathematicians sent a funding proposal to the Rockefeller Foundation. They were seeking support for a summer of brainstorming at Dartmouth College in New Hampshire. Their goal was to carry out a two-month, ten-person study of artificial intelligence ‘to find how to make machines use language, form abstractions and concepts, solve kinds of problems now reserved for humans, and improve themselves.’ Lacking no modesty, the application said ‘We think that a significant advance can be made in one or more of these problems if a carefully selected group of scientists work on it together for a summer’ (McCarthy et al 1955).

The Dartmouth Workshop was held in 1956. It did not solve the problems of artificial intelligence over two months. But it did mark the first use of the term ‘artificial intelligence’, and the attendees at this seminal event are considered the founders of AI research.

In the coming decades, researchers encountered several ‘AI winters’. Among the many challenges that programmers encountered was the difficulty of word-sense disambiguation. Put simply – to translate a sentence a machine needs to have some idea of the subject or it made mistakes. One possibly apocryphal example arises from an attempt to train an AI to translate from English to Russian. Given the English saying ‘the spirit is willing but the flesh is weak’, the early AI model translated it literally into Russian as ‘the vodka is good but the meat is rotten.’

Those early researchers weren’t just held back by the processing power of their machines. They were also working on a model of AI that was based on giving a computer a series of rules that it would follow in sequence. The problem is that humans don’t learn how to speak by following rules. Instead, we learn by listening to others. By trying and failing. Over and over.

Classical symbolic AI is dubbed GOFAI, or Good Old-Fashioned AI. Generative AI – which trains computers by providing them with vast numbers of examples – succeeds where good old-fashioned AI failed by using neural networks. Those networks need vast amounts of data. And in recent years, they have made vast breakthroughs.

Water Amendment (Restoring Our Rivers) Bill 2023
Second Reading Speech
House of Representatives, 13th September 2023

Cast your mind back to the last drought, some three years ago, when the Darling River stopped flowing for more than 400 days, when farming communities were brought to their knees, desperate for water, when millions of native fish died and gruesome environmental images were broadcast across the world. Last month the Minister for the Environment and Water, Tanya Plibersek, struck a deal with basin state and territory governments in order to deliver the Murray-Darling Basin Plan. This historic agreement reflected the policy that Labor took to the last election to deliver the Murray-Darling Basin Plan in full. For me, as an ACT representative, this is important. The ACT is one of the signatory governments. I note that the minister who's responsible, Shane Rattenbury, has talked about the importance of the Murray-Darling Basin Plan to the ACT.

Bills
Statutory Declarations Amendment Bill 2023
Second Reading
Federation Chamber, 13th September 2023

Dr LEIGH (Fenner—Assistant Minister for Competition, Charities and Treasury, Assistant Minister for Employment) (17:54): In my early 20s, as a law student, I decided that I wanted to become a justice of the peace. The process then was that you wrote to your local member of parliament, who, in my case, was the Liberal member for Northcott, Bruce Baird. He was quite happy to support me as a justice of the peace. I did so because I wanted to help out in the community, and I was struck by the number of times I'd encountered people who need a statutory declaration witnessed but were unable to find somebody to do so. Every 10 seconds in Australia a statutory declaration is filled in, amounting to some 3.8 million statutory declarations a year and costing some 900,000 hours. Those statutory declarations might involve evidence in a court proceeding; they might involve issues around child custody.

This significant modernisation ensures that, rather than requiring statutory declarations to be carried out in the traditional paper based form with an in-person witnesses, they can also be carried out in two alternative ways: electronically, by allowing electronic signatures and witnessing by an audiovisual communication link; or digitally verified through the use of an approved online platform that verifies the additional identity of the declarant through an approved identity service.

This will be an important efficiency gain for businesses, but it also has a crucial equity dimension. I know that is why the Attorney-General has championed it so strongly. We frequently find that people who want to get a statutory declaration witnessed have to pay for that service. Or, if they can find a free service, it's limited in the length of the statutory declaration or limited in the approach that it takes to attachments. So it is the most vulnerable who often find themselves unable to complete the in-person statutory declarations. Thanks to these reforms, those who are unable to pay for in-person witnessing service will have an alternative approach. I commend the Attorney-General for this important efficiency and equity measure to modernise statutory declarations in Australia.

Higher Education Support Amendment (Response To The Australian Universities Accord Interim Report) Bill 2023
Second Reading Speech
House of Representatives, 4 September

There are hundreds of thousands of 18-year-olds who began university this year. Those people were born in 2005, and they'll be at university from 2023 to 2025 if they do a regular, three-year bachelor's degree. Those people won't be eligible for the pension until 2072. At the end of their working lives, they will be dealing with the advanced technology of a workplace in 2072. We don't know the exact contours of what that labour market will look like, but we do know that it will be the sort of labour market which will reward high levels of skills. Just as the level of skill in the Australian economy has steadily increased over the last couple of generations, it will continue to do so for the current cohort. That means that, to a school leaver today, who was born in 2005 and who isn't eligible for the pension until 2072, university looks increasingly attractive. University won't be for everyone, but, in an age in which artificial intelligence is increasingly taking more routine jobs—automation of mobile services and factory automation are filling niches once filled by workers—higher levels of education are valuable. Our crystal ball for forecasting the precise jobs that will rise is a bit cloudy, but we do know that it's a very good bet that the jobs of the future will require higher levels of formal education than the jobs of today.

Where will those new university graduates come from? They'll tend to come from groups that are currently underserved. At the moment around half of Australians in their late 20s and early 30s has a university degree, but that level differs quite markedly across Australia. In the outer suburbs of major Australian cities, only 23 per cent of young Australians have a university degree. In the regions, only 13 per cent of young Australians have a university degree. Among young adults from poor families, only 15 per cent have a university degree. Among Indigenous Australians, only seven per cent have a university degree. For a young Indigenous man today, you're more likely to go to jail than you are to go to university. Right across the population, 36 per cent of Australians have a university qualification today, and it's been forecast that by mid-century it's going to be necessary to have 55 per cent of the population with a university qualification.

SPEECH

THE ECONOMICS OF CORRUPTION

National Integrity Summit, Melbourne
Wednesday, 30 August 2023

I acknowledge the people of the Kulin Nations, the Traditional Custodians of the land on which we gather today.

I pay my respects to their Elders, extend that respect to other First Nations people present today, and commit myself, as a member of the Albanese Government, to the implementation in full of the Uluru Statement from the Heart. including a constitutionally enshrined Voice to Parliament. 

Thanks to Transparency International Australia and your CEO Clancy Moore for inviting me to speak today. I also acknowledge the National Anti-Corruption Commissioner Paul Brereton, Deputy Commissioner of Victoria’s Independent Broad-based Anti-corruption Commission Kylie Kilgour, and longtime anti-corruption campaigner Professor A.J. Brown.

The Moonlight State

While Australia has had many corruption scandals, the Fitzgerald Inquiry and the systemic corruption among police and Queensland politicians it unearthed stands out both because of the scale of the corruption that it revealed and the long-term impact it had.

Historian Raymond Evans described the Fitzgerald Inquiry as ‘the most remarkable Commission of Inquiry in Australia’s history’.[1] In 2009 – in the lead up to the 20^th anniversary of the tabling of Fitzgerald’s report in Parliament – then Premier Anna Bligh said:

‘In many ways, the Fitzgerald inquiry was Queensland’s Berlin Wall. It washed away an old regime and heralded in a new era.  Nothing on Queensland’s political landscape has been the same since.’[2]   

The system whereby corruption police would take protection payments from the sex industry was called ‘the Joke’, but the cost was no laughing matter. By the 1980s tens of thousands of dollars in bribes were being paid each month to senior police the culture that grew up around the crooked cops went far beyond one industry. To quote the Fitzgerald Report:

The later segment of evidence involving political figures demonstrated that misconduct in the Police Force was not isolated, but part of a wider malaise to do with attitudes to public office and public duty.[3]

Indeed the Fitzgerald Inquiry may never have happened if then Premier Joh Bjelke-Peterson hadn’t been on a trip to the United States on the night the Four Corners show ‘Moonlight State’ aired.[4] As a result it fell to the Acting Premier Bill Gunn to initiate the inquiry. 

The Inquiry ultimately led to four former state ministers, and multiple senior police being found to have engaged in corrupt conduct, and the establishment of Queensland’s first anti-corruption body, the Crime and Misconduct Commission (now the Crime and Corruption Commission) in 1988. 

Corruption ultimately brought Joh’s premiership to an end. According to party-room records revealed years later – Joh was allegedly set to receive up to $20 million to facilitate the construction of what would have then been the world’s tallest building in Brisbane.[5]

His National Party colleagues refused to wave the deal through, so Joh tried to reshape his Cabinet. He demanded five Ministers resign – they refused. He demanded the Governor of Queensland, Walter Campbell call an election despite the Parliament only being a year old – which Campbell declined. Joh was ultimately challenged by Mike Ahern – ending 19 years as Premier.

Joh himself was put on trial for perjury in 1992 but the jury deadlocked.

According to another episode of Four Corners from 2008: ‘A later inquiry conducted by Justice Bill Carter found the [jury] selection process had been manipulated by ... ex-police officers ... helping to put Joh before a jury led by Young Nationals member, Luke Shaw’.[6]

When corruption really gets into the bones of a society the damage it does to institutions can take generations to heal.