Special lecture by the Hon John Brumby AO - Q&A


Q) Noting your views on work from home and the fact the majority of current proposed infrastructure projects (by Infrastructure Australia) are centred around urban congestion, where do you believe governments should redirect their focus for the best productivity gains for Australia over the next 50-100 years?

Q) Governments appear to be turning to similar medium- to long-term stimulus responses to the economic contraction as they did in the past—namely spending on physical infrastructure. However the circumstances this time are different and have affected other forms of our infrastructure—such as our social, community and educational infrastructure—much harder. Should Governments respond differently in their recovery stimulus spending this time, and if so, how?

A) Proposed infrastructure projects may need to be reviewed in the light of post-COVID-19 realities. Regional development may be a higher priority. Road user pricing would be one way of managing congestion and replacing falling fuel excise revenues. NBN and 5G will play an important part in a world where there is more working from home, and Australia will need the very best digital infrastructure. As I mentioned in my lecture, there is large scope for massive investments in renewable energy and social housing. Proposed investments should lead to net new jobs, improved quality of life, a cleaner environment and more innovation.

Q) Do you believe that in the best-case scenario of a vaccine being widely available say, later in 2021, some of what we’re seeing now re reduced use of public transport, working from home, shift to the regions and economic activity in general, will revert back to pre-2020?

A) Certainly there will be some shift back, but the crisis has revealed that we can adapt faster than we think to new technologies and new ways of working. Therefore, where there are clear advantages to working remotely—more time with family, less need for office space, greater productivity, etc—it’s reasonable to expect that this option will be taken up.

Q) Housing affordability? Surely work from home means a greater investment in the family home and prices will rise?

A) So far we have seen a fall in house prices in many urban areas. A general economic downturn may mean less appetite for investment in property, which may drive prices down. Working from home does not necessarily translate into a greater investment into that home, although some retrofitting could conceivably add to the value of the house.

Q) I'm really interested in the opportunities for regional areas. Can you describe the network of cities or economies in Victoria post-COVID and what will be their economic base?

Q) I have issues with cashless transactions, internet speed and efficiency and regional areas—most important that rural areas are not disadvantaged. Cashless transactions actually cost and banks gain. 

A) Pre-COVID there were already huge opportunities in the regions, as I identified in my Regional Economic Development and Services Review for the Andrews Government in 2015.

We also identified problems with internet service provision, and these will need to be addressed.

Cashless transactions were already the norm in many countries before the COVID-19 crisis, including many parts of China. It seems unlikely we would go back to cash, especially with added hygiene concerns. It is of course important that rural areas are not disadvantaged in this, hence there is a need for more investment in regional digital infrastructure.


Q) While I don’t disagree with the economic benefits from China, one can’t ignore their behaviour: human rights, flouting international law, bullying poorer countries, security hacking, disregard for IP, blocking trade, censorship—the list goes on. A stronger China, in which we are more reliant on it, I don’t see being necessarily a good thing for Australia. While we shouldn’t ignore China and continue to work with them, what do you believe our relationship should be with them to keep a balance between economic benefit and their disregard of democratic and human values?

Q) Foreign policy decisions made by the Commonwealth inevitably affect State governments. How can Victoria maintain positive international engagement with China and continue to support its agriculture, education and other industries in light of increasing tensions between the Commonwealth and China?

A) Without downplaying our significant differences with China (of course, we have differences with many nations), we should recognise the enormous achievements China has made in the four decades since opening up: average growth of almost ten per cent per annum, the lifting of more than half a billion people out of extreme poverty, and a massive contribution to global growth and rising standards of living—especially in Australia. I favour constructive engagement with China: we will be best placed to prosecute our concerns about human rights and other matters when we have a seat at the table with China. We should continue to work with China on issues of common concern, especially environmental issues. And as I mentioned in my talk, at a time of global recession and perhaps depression, we should be working on improving our relationship with our biggest trading partner and one of the largest markets in the world. It’s also worth noting that the relationship with China does not only exist on a government to government level: we need to keep working on our business to business and person to person relationships too.


Q) Do you think it's realistically achievable to get back to ‘full’ employment? Do governments need to start thinking about universal basic income (UBI) in recognition of the changing nature of the workforce?

A) While I don’t necessarily favour a UBI, governments will need to look at all the options to get huge numbers of people back into work. Younger people are particularly vulnerable to higher levels of unemployment. I would support a Youth Guarantee where all young people to the age of 25 are guaranteed either a full time training/education place, or a job. And of course, in the medium term governments will need to find ways to grow the economy and create jobs in the private sector.


Q) Agree totally that we need to be smarter. But the government is ‘anti-intellectual’ through its policies, particularly with respect to universities. Any comment?

A) Important as the resources sector is, Australia cannot rely on mining forever. We know this in Victoria, as we haven’t had a mining boom since the gold rush. When I was in government, we tried to find alternative sources of growth for our state, and that meant investing in research, particularly medical research. This involved a massive capital investment in universities and research institutes. By the end of our term in government, Melbourne was known worldwide as a rising centre for biotechnology. There has long been talk about the need for more innovation in the Australian economy, and more recently about a need to rebuild our manufacturing sector. If we want to be in the value-added business, there is no alternative to investing in our universities and research institutes as the best source we have of new ideas, new technologies, and new ways of operating.