I mean, what How does the Productivity Commission get mixed up in something like that? Because it can certainly bear upon the accountability of decision making down the track.

So we have said some things on AI.

So we were asked by the government last year to look at competition and productivity in digital markets.

And we're frankly pretty optimistic about the capacity of AI to improve productivity.

And when I'm saying AI, then what I'm talking about really is businesses across Australia embedding AI into the way they work.

And if we look through the long arc of history, it is these sort of big general purpose technologies that tend to drive decades of growth.

So the steam engine or electricity or the first ICT revolution.

Where does an inquiry like that come from and how does it fit with everything else that's going on state and federal? And how can you, I suppose the final question is, how can that reference assist the policy makers in this case?

What would meaningful reform look like? It's something you've looked a lot at.

So we've done a kind of interim report.

So everything I say will be sort of with an interim report lens on kind of the impact of regulation on housing supply.

You know, so what we found is great potential to expand supply through meaningful changes in planning laws.

So fun fact, across all of our major capital cities other than Melbourne, more than 75% of land is zoned for one or two storeys only.

If you increase that to three, gentle density, allowing townhouses, allowing low rise apartments across large swathes of the city, which is something they did in Auckland, you know, you allow so much more supply and a lot of feasible supply because a lot of people do want to live in kind of townhouses in these areas.

A whole range of other things you need to do around minimum block sizes and different rules in the planning system to then facilitate that.

So on that all, what's the biggest opportunity and the biggest risk on each side of that ledger?

Can you tell us what happened?

I can indeed, and it is a very beautiful frog.

I recommend listeners check it out.

So local farmer, environmental charity got together and hatched a plan to try and save the frog's habitat.

It got the New South Wales government on board.

They committed some money to doing it.

But of course, if you're going to sort of mess around with waterways, you need approvals to do that.

Why should that be, that as we get richer, we want more rules?

What do you want to see?

So what we are calling for is really a lifting of a lot of the restrictions on what can be built and where.

So one thing is to move to gentle density across our cities.

So at the moment, Perth is the least dense city with a population over 1 million in the world.

And Adelaide is probably equal, but was excluded from the comparison for various statistical reasons.

So probably we have the two least dense cities over a million in the world.

Even Sydney and Melbourne are well down the list.

So what do you propose?

What, what would that look like?

Well, what we've said on the land use side, so this is around planning systems, at the moment about three-quarters of, um, cities like Adelaide, Perth, Sydney, Brisbane, you can only build one or two stories.

We're advocating for more gentle density across our cities, um, so you should be able to build up to three stories, so that would be more townhouses, uh, more low-rise apartment blocks, but also greater density, medium and high density in activity hubs near major transport links.

We think that would really considerably, uh, boost the capacity to deliver more housing.

On the infrastructure side, we absolutely know that infrastructure connections are important.

You know, we heard stories of, um, new land being released on the city fringes for housing, but because there was no sewage connection or no water connection, you know, those houses couldn't be built for a number of years.

So pre-planning that infrastructure piece is also gonna be part of the solution.

Are you getting the feeling from, from government and other bodies that there is a determination for change now?

So as we get richer, we want more of it.

As we get richer, we, and this is going to be a very economist way to talk about value of life.

So let me caveat that first.

But, you know, research shows the sort of statistical value of life, what we're willing to pay to avoid death increases.

You can think of that in a regulatory sense that all of a sudden we might be willing to bear a whole lot more regulatory costs to preserve safety in a whole lot of different spheres.

We have higher expectations of governments.

We expect services to work better, we might expect governments to be tackling more environmental issues, social issues.

What are the things that government can do to kind of ensure that it is delivering regulation that does the important things that we all agree we want to do without kind of handicapping the rest of the economy?

about.

So, you know, we might be worried about safety of products or misinformation or defamation or, you know, you can think of a whole range, competition, consumer issues.

So many of these things we have existing laws to cover.

So our approach has always been, well, let's, make sure that those laws are fit for purpose.

We should absolutely review them.

If there's holes that don't work in a world of AI, let's fill them.

But let's do that in preference to coming in over the top with a kind of overarching AI act.

Are we driving enough change in the public sector and are there things there that can be effective or is that a harder ask? Look,

Mm.

And, you know, ultimately, um, whether we reap the benefits of AI is gonna depend on businesses actually kind of adopting it and, and changing their practices to incorporate it.

Uh, and so a, a good example f- in Australia, um, in history is, um, called, uh, agricultural extension services.

Uh, and so...

And these services have been around and provided by government, I think, for 100 years, and this is like a very old concept, which is the idea you've got a whole lot of farmers, they're very diffuse groups.

Uh, so government would kind of go out to farms or meet with groups of farmers and, you know, talk to them about what they know about, uh, technology and ag, which could be, you know, new crop varieties, it could be pest control, it could be land management techniques, um, so that farmers have kind of the best information about how to employ, um, new ways of doing things on farms.

And those services over time have been judged to be, um, you know, really effective [chuckles] at actually shifting farmer behavior.

Mm.

What are the biggest drags on the construction sector right now?

This is such an important issue because we know housing is a massive concern, the affordability of housing.

And key to that is actually getting supply moving.

Our work does show that there are a number of issues at play.

There is planning regulation, which just makes it harder to build the houses properly.

We need near jobs, near infrastructure.

There's these very convoluted approvals processes, which involve state and local governments, which just slow down the time to get things built.

Do you think that will be effective?

What do you make, Danielle Wood, of where the NDIS has grown to and, and now these plans to rein it back in?

in?Look, you're absolutely right, it was a, a PC recommendation, and, uh, I think what we saw at the time was an environment of supports for people with disability that was fragmented, hard to some degree unfair, it mattered where you were.

And so the NDIS was a scheme that was set up, um, to ensure that those with significant permanent disability would get the, the supports they need and the, the individualized supports they need.

Um, so I think it has been a really important and transformative scheme.

Uh, that said, you know, I think the government is absolutely right to say it has gone some degree off the rails and, and clearly a, a 10% growth rate, uh, isn't sustainable over time.

Uh, I think the, the sort of shift in eligibility that the government is talking about, which is, um, you know, moving more to, to, to functional assessments rather than diagnosis-based assessments, you know, brings it back closer to the o- original model envisaged by the, the PC.

And then I think, you know, the other sort of set of shifts is around, um, making sure that the, the markets for services are working well-

Um, are you disappointed this one hasn't taken off?

J-just take us through what you found and what you found as to the cause of it.

Yeah.

It's, it's kinda wild, isn't it? In most industries, we get better at doing things over time, and in fact, in every other, uh, sector of the economy.

In, in housing, we have got worse on that measure.

I mean, one thing that's important to say is houses have got bigger and better in that time, and so when we make that adjustment to the data, productivity's only down 12% [chuckles] over the 30 years.

It's still, as I said, extraordinary to think it's gone backwards.

There are a few things at play.

So were any of your suggestions in that final chapter taken up?