About the NSW Productivity and Equality Commission

The NSW Productivity and Equality Commission was established by the NSW Government in 2018 under the leadership of inaugural Commissioner Peter Achterstraat AM

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Our Commissioner

Peter Achtertraandt AM

Peter Achterstraat AM

NSW Productivity and Equality Commissioner

Peter was the NSW Auditor-General from 2006 to 2013 and prior to that served in other roles, including Chief Commissioner of State Revenue and Deputy Commissioner of Taxation at the Australian Taxation Office.

He was the President of the Australian Institute of Company Directors (NSW Division) from 2014 to 2020 and was the Chair of the Sydney Financial Forum from 2015 to 2022. He has also served as an adjunct professor at the University of Sydney’s Graduate School of Government and held the positions of Infrastructure Adviser for Advisian and the Administrator of the National Health Funding Pool.

Peter holds an Honours degree in economics as well as degrees in law and commerce from the Australian National University. He was awarded the Australian Finance Conference Prize for Company Finance and the PricewaterhouseCoopers Prize for Accounting. In 2006, he was inducted into the Australian National University College of Business and Economics' Hall of Fame.

Peter is a Barrister of the Supreme Court of NSW and is a Fellow of the Institute of Chartered Accountants in Australia, CPA Australia, Chartered Secretaries Australia, and the Institute of Public Administration Australia.

In 2024, Peter was reappointed for a further 2 years in the expanded role of Productivity and Equality Commissioner. 

What we do

Sydney City with a bus and pedestrians

Productivity growth is essential to ensure a sustained growth in living standards for the people of NSW, by fully utilising our knowledge and capabilities, technology and research, and physical assets. 

The Commission is tasked with identifying opportunities to boost productivity growth in both the private and public sectors across the state. The Commission seeks to continuously improve the NSW regulatory policy framework and identify levers that can increase competition to deliver better and more affordable goods and services for NSW residents.  

The Commission’s priorities include:

  • Fit-for-purpose regulation
  • Efficient and competitive NSW industries
  • Improved public service delivery
  • Climate resilient and adaptive economic development.

How we work

The NSW Productivity and Equality Commission (formerly the NSW Productivity Commission) was established by the NSW Government in 2018. The Commission provides objective, evidence-based advice to the government.

In performing its functions, the Commission considers equity and how costs and benefits are distributed across the community and over time.

For instance, the Commission’s research on housing examines the equity and environmental benefits of policies and reforms to improve housing affordability, beyond the overall productivity and economic benefits.

The Commission regularly engages with stakeholders to ensure its research and recommendations are well-informed and to encourage a public conversation on productivity reform.

Our organisation

The NSW Productivity and Equality Commission is part of the Economic Strategy and Productivity Group at NSW Treasury.

The Commission works closely with the Markets and Regulation Division, which comprises the Productivity Reform and Competition and Regulatory Policy branches.

Our structure

NSW Treasury Economic Strategy and Productivity Group

NSW Productivity and Equality Commissioner

NSW Treasury Markets and Regulation Division

Productivity Reform Branch

Competition and Regulatory Policy Branch

What is productivity and why does it matter?

Productivity is the ratio of economic output (goods and services) per unit of input, such as labour, capital, technology or raw materials.

When productivity grows, it means we have learned to produce goods and services with less effort and resources. Productivity growth is the key driver of long-term improvements in living standards.

This means:

  • Increased real wages
  • More affordable goods and services
  • Higher quality of goods and services
  • Increased leisure time
  • Increased choice of goods and services.
A woman buying milk in the supermarket
How productivity improves living standards of NSW households

The number of minutes worked by the average worker to buy 1 litre of milk:

30.6 mins

of work in

1901

2.2 mins

of work in

2019

2.7 mins

of work in

2023

Long-term trends in productivity

Labour productivity growth in NSW fell from almost 2% in the period to 1990 to1999 to just over 1% in the decade prior to COVID-19. In the 2000s, NSW compensated for low productivity growth with a workforce participation boom. In the 2010s, we relied on strong migration.

We need productivity growth to be closer to the levels in the 1990s to drive NSW’s next 40 years of prosperity.

Figure 1: Productivity’s contribution to economic growth in NSW

A graph showing Productivity's contribution to economic growth in NSW
Source: 2021–22 NSW Intergenerational Report.
Note: Projections are as of 2021 and do not reflect latest NSW Treasury estimates.   

Recent trends in productivity and wages

In the period 2013-2019, NSW saw slow growth in labour productivity (0.86% p.a) and near zero (0.24% p.a) growth in real wages.

Labour productivity and wage growth do fluctuate year to year, but recent periods show clear trends.

During COVID-19, NSW saw an unexpected increase in labour productivity (2% per year), partly due to low-productivity service industries shutting down. Real wage growth declined (0.63% per year) due to high unemployment.

Recent post-COVID data showed NSW productivity growth in 2023 fell by 5.46% as low-productivity service industries came back online. Real wages continued to decline by 3% due to high inflation.

Figure 2: Recent trends in NSW productivity and real wage growth

Graph showing
Source: NSW Productivity and Equality Commission analysis. 

Since its inception, the Commission has undertaken several reviews on productivity and published the landmark NSW Productivity Commission White Paper 2021: Rebooting the Economy.

2:34

Talent

By investing in our people, they will have greater satisfaction in their careers and in life.

Read transcript
Video transcript

Talent

Peter Achterstraat AM - NSW Productivity Commissioner
 
People are our biggest asset. The people of NSW have got fantastic potential. 
 
The more we invest in our people, the greater the satisfaction they will have in their careers and in their life, and the greater prosperity the rest of our community will benefit from.
 
Education and skills training are amongst the two most powerful productivity levers in the State Government's remit. We want to ensure that all our children get the very best start in life, and to do that we have to have great teachers.

I also believe that we need to find new pathways into skilled jobs. If we can find ways to transition people into these new jobs, then they'll be able to help us fill the chronic skill shortages that we are suffering in various trades across the state. That's
why I've put forward a suite of recommendations in the White Paper, which I'd like to take you through right now.
 
First, I'd like to bring more highly skilled people into the teaching profession. The teaching profession is a wonderful career, a wonderful vocation and I believe there are a large number of people in the business community, for example, who would consider a change of career into teaching when their life circumstances change. Chartered accountants and finance professionals could make wonderful teachers in mathematics and engineers may wish to move into a science teaching arena. We need to make it easier for these people to swap careers.
 
These days, learning doesn't finish when we leave school. I want to make sure that there are a lot of different ways to get people into secure, fulfilling, rewarding well-paid jobs. This may involve having people undertake micro credentials, where they
can transition quickly into a group. It may mean different ways of delivering the apprenticeship training, for example, mums returning back to the workforce may benefit from training of an evening, rather than during the day.
 
Finally, I want to make sure that NSW is a magnet for skilled quality people from other states with high qualifications in trades and apprenticeships, to come here and fill some of our skill shortages. To do this, we need to eliminate some of the bureacratic barriers which prevent fully qualified tradespeople from other states from exercising and undertaking their trades in NSW.
 
Education is the key to inspiration and aspiration.
3:22

Innovation

Innovation is the essence of productivity improvement.

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Video transcript

Innovation

Peter Achterstraat AM - NSW Productivity Commissioner

Innovation is the essence of productivity improvement, and innovation is much more than just inventing things. It's about using our existing assets better, it's about finding new ways of doing things.

For example, during the COVID pandemic many people came up with wonderful initiatives on how to work hybrid, how to work in various different situations. They've unlocked a lot of efficiencies to ensure that their tasks are done more productively. 

Many of the regulatory changes during the COVID-19 period have now been implemented and made more permanent; from digital signatures; to strata meetings online; to deliveries of goods and services at night and removing inefficient processes
and systems.

The people in the community have looked for ways of doing things, government has responded and I believe should continue to respond, to listen, to these initiatives from the community on how regulation can be more streamlined. Ingenuity can deliver as many benefits as big ticket innovation.

Another good example relates to the farming community. The small farmers would benefit tremendously from having drones to be able to stock management, weed control etc however at the moment the regulatory requirements. the bureaucratic red tape, the forms that have to be filled out for a small farmer to be able to use a drone are quite burdensome. I believe if they can be streamlined, then the drones can be used much more effectively, we'll save time, we'll improve productivity, we'll improve stock yields and reduce accidents on the farm.

Another area where regulation has to keep up with innovation is in relation to e-scooters and e-bikes. We need to ensure that people are getting from point A to point B in the most effective way. When there is no specific regulation on issues such asthe e-scooters, it becomes a bit of a free-for-all people take liberties, because there's no speed limits there can be accidents we need to regulate e-scooters to make sure that they're used more effectively and more productively.

In relation to e-bikes, there is currently a restriction on the size of the motor on an e-bike. Numbers of packages which in other jurisdictions can be delivered on an e-bike in NSW have to be delivered on a truck. That means that there are more trucks on the road than there needs to be. If we can get these packages out of the trucks and get them delivered by a medium-sized e-bike, that will free up congestion and will reduce pollution and we'll get deliveries done quicker.

Land-use planning is another area ripe for innovation. One of the consequences of the pandemic has been that we've changed our working arrangements. There's hybrid working arrangements that have come into place. Now, if we want to have more
residential people living in the city closer to work, or we want to have more people working from home actually, in a business, we need to revisit the planning requirements, so that we can meet the needs of the people who are residing and the people who are working.

We need to encourage people to come into the city. We also need to encourage people to be able to live in the city, so the planning requirements need to change to take into account the changes in working habits.

1:27

Housing

We need to ensure that people have the right housing, in the right place, at the right price.

Read transcript
Video transcript

Housing

Peter Achterstraat AM - NSW Productivity Commissioner

Housing is a key focus area of mine. We need to ensure that people have the right housing, in the right place, at the right price. 

Rapid increases in housing prices have put the spotlight firmly on housing affordability. At the moment, more and more young people are staying at home with their parents. More and more people are sharing; and overcrowding and more key workers are unfortunately having to live greater distances away from their workplaces.

If we can improve the supply of housing, that will give people a greater opportunity to acquire the housing that they want, in the area they want, at the time that they want.

I'm keen to ensure that there is more housing around existing infrastructure. 

NSW has invested heavily in transport infrastructure. Over the last few years, we have new railways, we have new busways; and new roads. These transport modes need to be better used. It will make the commute for people quicker, it will reduce congestion and will make a more vibrant facility for people to be living in. 

Also, where we are building new housing estates, we need to ensure that there is infrastructure that services that. Whether it be road, whether it be rail, whether it be hospitals, whether it's schools, so we get the maximum benefit out of this housing.

Productivity levers

The amount of goods and services produced per head in Australia increased continually in the 1980s, 1990s, and early 2000s. Unfortunately, that rate of increase has fallen in recent years. Output per worker is higher in some countries than others.

25%
The average worker in the USA produces 25% a week more than a worker in Australia.

 

These differences can occur because of factors like:

  • higher skills
  • more capital equipment
  • better regulation
  • less reliance on taxing wages.

Levers to improve productivity

A more adaptable and skilled labour force - VET and schools
The right infrastructure
Effective government services
Technological diffusion
Fair and efficient taxation
Natural resource management
Improved physical health
Better mental health
Higher workforce participation
Increasing trust in institutions
Research, development and innovation

Digitisation

Effective Commonweath-State relations
International trade
Foreign investment
Skilled migration
Well-functioning financial systems
Abundant and well-located housing
Competition policy
Energy and climate policy
Industrial relations
Planning reform
Effective regulation

Contact NSW Productivity and Equality Commission

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