The Australian economy rebounded robustly in the wake of the pandemic. However, inflation has risen and fiscal pressures are on the horizon due to population ageing and climate change. Monetary policy should remain restrictive until underlying inflation is clearly on track to meet the central bank target, while fiscal buffers need to be rebuilt through reducing tax exemptions and improving public spending efficiency in areas such as health. In the medium-term, achieving inclusive and sustainable economic growth requires an ongoing focus on key social objectives such as reducing gender inequality and achieving the climate transition. Gender inequalities have steadily declined but remain visible in the labour market. Further reforms to tax, childcare, education, social benefits and parental leave can improve labour market opportunities for women, promote more equal sharing of unpaid work between genders and help more vulnerable women, notably single mothers. The climate transition is also underway, but further policy measures are needed to meet emissions goals, support the reallocation of workers and adapt to climate change. Given the abundance of renewable energy resources and a large wealth of critical minerals, Australia can secure the energy transition while remaining a key player in international energy markets.

SPECIAL FEATURES: FULLY REALISING THE ECONOMIC POTENTIAL OF WOMEN; ACHIEVING THE TRANSITION TO NET ZERO.