A Productivity Commission: A Proposal for an Australian-style approach to creating a Policy-Reform Process for the UK

The UK now faces many fundamental political-economy choices. These cover: dealing with the implications of Covid for healthcare and social care; making post-Brexit decisions about trade policy and industrial policy; achieving net-zero carbon emissions; responding to the North-South divide and dealing with inequality; rethinking the UK's policy for primary, secondary and tertiary education; and constructing a policy to shape the country's research and development agenda. All of these choices have implications for how the UK's low level of productivity might be raised. This paper argues that there is a need for a national policy review institution – a Productivity Commission - to provide guidance for these choices. This would be a statutory body, one that could both analyse reforms and make policy recommendations to Government, according to their implications both for the UK's national interest, and for different groups within the country. A valuable model is provided by Australia's Productivity Commission, an institution with a long history of making recommendations on a wide range of microeconomic and social-policy issues. I spell out how this institution came to be established, why it has been so important in Australia, and what we can learn from this Australian experience. I examine what the policy guidelines for such an instiution might be and show how such a body might be established in the UK.