Sydney street crowd

Land planning, energy, water, housing affordability and jobs of the future are among the key priorities identified by the NSW Productivity Commission in a discussion paper released ahead of a wide-ranging inquiry.

But while the word sustainability is used frequently, along with terms like “climate variability” and “climate change”, fossil fuels appear to be considered a fundamental part of the state’s economy and industry into the foreseeable future.

The expansion of gas exploration and production, for example, is highlighted. While there is extensive talk about road congestion, it’s taken for granted that private vehicle numbers will continue to increase.

The population is also expected to increase, and making the state “easier to move to” is one of four challenges that frame the discussion.

The others are environmental change, technological disruption and an ageing population.

The six priority areas the commission will focus on to boost productivity are: building human capital; “reliable, sustainable and productive use” of energy and water; getting more from state infrastructure; modernising the state tax system; planning for “the housing we want and the jobs we need”; and regulations that support competition and innovation.

Water issues canvassed in the paper include increasing the use of recycled water beyond irrigation and other non-potable uses, as part of ensuring adequate and reliable water supplies as the climate becomes more “variable”.

The paper stated that productivity improvements can address environmental challenges, including those posed by “increasing climate variability”.

“A more productive economy means using resources more efficiently, including our scarce natural resources, to produce the same output,” the paper stated.

“This could involve a more circular economy, for example.”

Lack of coherent federal government policy on emissions reductions and a low carbon energy transition is cited as a major barrier to NSW investing appropriately in renewable power generation.

It noted that NSW has adopted strategic priorities in the Climate Change Policy Framework, including an objective of net zero emissions by 2050.

“If the Commonwealth is not prepared to coordinate emissions policy for the energy sector, New South Wales could consider its own initiatives to reduce uncertainty and meet its 2050 target,” the paper said.

“This could have significant benefits, particularly given the state’s central geographic position within the [National Electricity Market].”

Demand management is flagged as worth pursuing, not only for its ability to reduce strain on the grid, but also to resolve some inequities in relation to household energy costs.

The paper noted that the increased uptake of airconditioning and corresponding energy use by households has contributed to recent rises in fixed charges such as the supply charge that’s part of every household’s bill.

This means that those who cannot afford to own or to operate airconditioning are effectively subsidising wealthier households who can afford it.

Some key talking points for the built environment

The discussion on housing affordability opens up various possibilities. However, the emphasis appears to be on letting the market sort it out and reducing barriers to development.

The need for green space for public amenity, wellbeing and to mitigate the urban heat island effect is discussed, with the caveat that providing green space is often in conflict with the need to densify the city.

Whether Continuing Professional Development (CPD) should remain mandatory for some professions integral to the built environment is raised. Currently, NSW is the only state where CPD is mandatory for professionals including builders, swimming pool builders, real estate agents and strata managing agents.

The paper suggests making CPD voluntary would reduce barriers including costs and “regulatory burden” without seeing a drop in the number of practitioners choosing to engage in CPD.


Employment growth has been tipped for sectors including aged care, child care and disability care due to factors including the NDIS rollout, ageing population and greater female workforce participation.

Highly-skilled and well-paid Jobs in knowledge and tech sectors are also tipped to increase, as are low-skill roles.

Where the jobs are expected to contract is in the mid-range occupations. TAFE and supporting TAFE, including addressing discrepancies between the support available to university students and TAFE students, are seen as an important element of re-skilling and upskilling workers for the future’s tech-enabled economy. 

In general, most of the focus is on Sydney as the economic driver for the state and on how to pack more people and more jobs in within the three CBD’s urban planning model.

The paper, Kickstarting the Productivity Conversation, is just the start of the inquiry process.

Feedback on the discussion paper closes tomorrow, Wednesday November 27. The feedback will inform the development of a Productivity Green Paper, which will outline policy options for consultation. Feedback from that paper will shape recommendations in a Productivity White Paper.

  • Read the discussion paper and have your say here

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