Australia must substantially boost its productivity if it is to stop an ageing population dragging down its growth rate over the next 40 years, Prime Minister Kevin Rudd says.
His comments come after the release of new Treasury figures which forecast that there will be 2.7 people of working age for every person over 65 by 2050.
The Australia to 2050 report claims that if working Australians increased their productivity growth from 1.4 per cent a year to two per cent, all Australians could be earning $16,000 more a year by 2050.
Speaking in Melbourne at an Australia Day speech on building the nation, Mr Rudd said governments need to take action now to protect Australia's long term economic interests.
"If we boost productivity growth by 2050, every Australian man, woman and child would be $16,000 better off," he said.
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"That is why raising productivity is so important to building Australia's future. It also provides the additional tax revenue that we need to support new services in health, in aged care and support for those of retirement age".
Tell us how to increase productivity: Opposition
But the Federal Opposition has called on the Rudd government to outline how it will increase the productivity of Australian workers.
The Deputy Leader of the Opposition Julie Bishop has told the ABC Mr Rudd should explain how he will prevent growth from stagnating.
"This was a missed opportunity to set out an achievable vision for Australia," Ms Bishop said.
"Rather than his usual cliches and re-hashed campaign slogans, Mr Rudd should have set out what he would actually achieve for Australia.
Under the Rudd government's re-regulation of the labour markets, there will be a missed opportunity to lift productivity rates in this country".
