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Former PM Malcolm Turnbull on the key to economic recovery

·4-min read
Australia's outgoing Prime Minister Malcolm Turnbull gestures at a press conference after a party meeting in Canberra on August 24, 2018. (SAEED KHAN/AFP via Getty Images)
Australia's outgoing Prime Minister Malcolm Turnbull gestures at a press conference after a party meeting in Canberra on August 24, 2018. (SAEED KHAN/AFP via Getty Images)

Former Prime Minister Malcolm Turnbull has urged for innovation to be back on the economic agenda if Australia is to pick itself up from the impending economic downturn triggered by twin crises of the bushfires and now the Covid-19 pandemic.

In a webinar hosted by Melbourne start-up hub Silicon Block, the 29th prime minister of Australia said that the word ‘innovation’ had become hamstrung by perceptions that the word had become a “bad idea politically”, and that this was holding back the economy.

“It’s a word that can’t be uttered, I’m told, in government circles now, which is really terrible.”

But innovation will be key to kick-starting the economy, according to Turnbull.

“The important thing is to have a strong economy that is innovative and is creating new jobs,” he said.

“You’ve got to decide, in this age of change, unprecedented both in its scale and pace, whether you're going to take advantage of it, or whether you're going to be a victim of it.”

With the number of new coronavirus cases in Australia falling every day, attention has now turned to economic recovery.

According to predictions by RBA governor Philip Lowe as well as the Grattan Institute, the unemployment rate is slated to hit 10 per cent in what will be the ‘worst economic downturn in history’.

Earlier this week, former deputy prime minister Wayne Swan warned that Australia’s bounce-back would likely look more like a ‘bathtub’ than ‘V-shaped’ as we have no economic measures in the medium-term beyond the six months Prime Minister Scott Morrison has budgeted for.

“If you give up on innovation you give up on productivity, and if you give up on productivity you give up on prosperity. It's that simple.”

Turnbull likened adapting and embracing innovation to coming face to face with an impending wave while surfing.

“Do you stand there and get dumped on? Or do you say, ‘no, I'm going to catch this wave and I'm going to ride it into the beach.’”

Former Prime Minister Malcolm Turnbull spoke in a virtual fireside chat with Melbourne start-up Silicon Block's Rhys Hayes and PwC chief creative officer Russel Howcroft on Thursday. (Source: Yahoo Finance screenshot)
Former Prime Minister Malcolm Turnbull spoke in a virtual fireside chat with Melbourne start-up Silicon Block's Rhys Hayes and PwC chief creative officer Russel Howcroft on Thursday. (Source: Yahoo Finance screenshot)

Turnbull said that investors’ willingness to invest in technology has increased significantly in the past few decades.

He referenced the National Innovation and Science Agenda (NISA), an initiative that he launched in 2015 during his time as prime minister and said he has seen greater willingness to invest in technology since then.

“I remember when you could not raise a cent. You know, you couldn’t raise a dollar for tech in Australia back in the 90s and early 2000s.

“And now there is a tonne of money here – we’re creating one unicorn after another,” Turnbull said, pointing to software giant Atlassian as Australia’s biggest example.

“There’s so much great Australian technology, and you've got people [from overseas] now coming to invest in it.”

However, rolling out measures to ease red tape for businesses and investors won’t be enough: the government of the day will need to be vocal in its support for innovation, Turnbull said.

“In many ways, the most powerful thing was the fact that I was using that megaphone … of the Prime MInistership to talk about innovation,” he said.

“So you started to get super funds saying, ‘gosh, the Prime Minister's talking about innovation all the time. What are we doing on innovation? Well, not very much actually. Okay, well we better allocate some money to [venture capital].

“And I think all of that was very important,” he said.

“If you give up on innovation you give up on productivity, and if you give up on productivity you give up on prosperity. It's that simple.”

Australia’s longest-serving treasurer Peter Costello has also previously flagged the importance of productivity, and said this would require tackling the “hard” and “unsexy” issues that would require reform.

Turnbull lost his Prime Ministership to Scott Morrison in August 2018 after a stoush over the National Energy Guarantee divided the Liberal party, triggering a leadership spill.

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