Trends in 2023: Looking Ahead

A lot can happen throughout a political year, and 2023 is shaping up to be no different.

With the first parliamentary sitting week coming up, the Nexus team has analysed the political landscape and has brought to light some trends and movements to track in 2023.

Hip Pocket First: Cost of Living

The quick rise in the cost of living in Australia – a key concern in 2022, will continue to rise through 2023. The Australian Treasury expects that the weakest time for the national economy will occur in the middle of the year.  In the latest quarterly inflation figure released by the Australian Bureau of Statistics (ABS),  the annual inflation rate in Australia climbed to 7.8% in December 2022. This is the highest inflation rate since 1990. Strong demand for domestic and international travel, electricity and new residences in Australia have contributed to the recent hike. This means that increases in mortgage, transport, food and potentially energy prices will continue to grow, and many consumers will start to cut spending and focus on necessities.  The Opposition and Greens were successful in establishing a Senate Select Inquiry on Cost of Living that will run throughout the year.  This issue is at the top of our economic and political list for 2023.

Money Matters: Economic Growth and the Budget

Treasurer Hon Jim Chalmers MP will be responsible for steering Australia’s economic growth in 2023, primarily through the 2023/24 Federal Budget. Handed down on Tuesday, 9^th May 2023, the Budget will be more substantive than the last two, handed down in 2022 during the election year. Treasurer Chalmers will have more control over his 2023 Budget and will likely devote most of the new spending towards working towards delivering Labour’s 2022 election promises. These commitments include lowering the cost of childcare, strengthening the workforce and Medicare and investing in manufacturing and renewable energy.

The Treasurer will also consider the findings of the Productivity Commission’s 5-Year Productivity Inquiry report, which will be released this month. The report looks at the future of work in Australia, including what skills will be needed and how to make businesses more adaptable to potential changes through worker retention and technological advances. The final review of the Reserve Bank will also hit the Treasurer’s desk in March and will impact how the banks and Australia’s monetary and fiscal policy are reformed in 2023. The Budget in May will be the first that is wholly owned by Chalmers and the new government and a crucial test.

Getting Heard: Voice to Parliament

Prime Minister Anthony Albanese faces a considerable challenge to elevate the Voice from a party policy to a nation-uniting, historic constitutional reform. The referendum, pencilled in for the second half of 2023, will dominate much of the political debate for the year. This push for successful constitutional change will also determine Anthony Albanese’s prime ministerial legacy and the potential for Labor’s re-election for a second term in 2025. It will be hard enough to get members of each political party to agree on what form the Voice will take, let alone pitch the Yes campaign to the broader Australian public. Only 8 out of 44 referendums in Australian history have been successful. Every Australian will need to be better educated and informed for the “Yes” case to win the day.

Workers United: Industrial Relations Reform

Industrial Relations is a key area of historical difference for both major parties.  However, unlike the previous Coalition government, the current Labor Government seems exceedingly willing to collaborate with and include the Trade Union movement. In 2023, Australia will continue to see these unions have a major presence in government decision-making and how they can shape everything from policy development to economic decisions.

According to the Centre for Future Work at the Australia Institute, 182 industrial disputes (including strikes and employer lockouts) occurred in 2022 from January to September. Several public transport strikes in New South Wales also occurred in November and December of that year. The Australian Institute noted that strike action by teachers and healthcare workers in NSW rose in 2022. Alongside the Government’s new labour law reforms in the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022, the barging power of workers and their unions may increase in 2023 as the cost of living and inflation rates drive more industrial action. Federal and State Leaders and employers will have IR and reforms firmly on their radar in 2023.

Don’t Click Here: Cyber Security

Data security and privacy breaches within governments and major companies in Australia and across the globe were a significant issue in 2022. These attacks will continue in 2023, and cybersecurity issues will remain a high priority for businesses and organisations big and small in the coming months. The amendments to the Privacy Act 1988 (Privacy Act) late last year will significantly impact the Australian Information Commission’s control over data security, its ability to enforce privacy regulation and increase penalties for serious or repeated interferences and breaches. For businesses, a strong focus on IT and cyber will be critical this year. Not wanting to be the next Optus, Australian organisations will be rethinking their management and response to ongoing cyber challenges.

Medi(repair): Strengthening Medicare Reform

Prime Minister Albanese called healthcare reform the first priority for 2023, with the biggest reforms in Medicare’s 40-year history scheduled for later this year.  Health Minister, the Hon Mark Butler MP, will seek to deliver on the Government’s commitment to strengthening Medicare and lowering the cost of healthcare by implementing the recommendations of the independent MBS Review Taskforce and the Medical Services Advisory Committee (MSAC) Executive. The central recommendation from the task force is an expansion of multidisciplinary care in general practice to combat a rising tide of chronic disease and meet the healthcare demands posed by an ageing population, in line with the national 10-year primary health plan.

Significant changes to the Medicare Benefits Schedule (MBS) are also scheduled from 1 March 2023. Most of the alterations are policy and minor administrative changes, such as the continuation of COVID-19 general and medical practitioner video conferences for eating disorders and mental health services.  Changes to head, ear, nose, throat neck surgery services to ensure contemporary clinical practice and the Medicare benefits appropriately reflect the skill and complexity of the relevant procedure. This Medicare reform task, touted as one of the largest reforms in the last 30 years, will now need to turn to implantation and execution.

Child’s Play: Childcare Reform

Capitalising on the Government’s promise to deliver cheaper childcare during the 2022 election and the $4.5 billion allocated in the 2022/23 Budget, Minister for Early Childhood Education, the Hon Dr Anne Aly MP, has announced an increase in the Child Care Subsidy rates (CCS) from 10 July 2023. The CCS percentage each family is entitled to is now dependent on income, with the maximum income limit being lifted to 90% for those that earn $80,000 or less. The CCS rates have also increased for 96% of families earning under 530,00 with a child in care. $33.7 million has been invested in growing subsided early childhood education and care to a minimum of 36 hours per fortnight for families with First Nations children. 2023 will see the immediate impact of these investments and the potential easing in living costs for Australians involved in the childcare system. A central pillar of Labor election commitments, childcare reform will be a key focus in 2023.

Greening Australia: Climate and Environment Policy

Adopting renewable energy and enacting climate and environment policy is expected to be a major trend in Australia in 2023 after the Government and Minister for Climate Change and Energy, the Hon Chris Bowen MP, committed to reaching net zero by 2050. The Climate Change Bills passed in 2022 ensure a whole-of-government approach to drive down emissions and uphold accountability that includes state governments. Further emission reduction reforms are anticipated through climate action implemented in the power sector and through electric vehicles, earlier retirement of coal, trends in the land sector, pressure on gas companies – and a shift in international markets for coal and LNG expected in countries adhering to the Paris Agreement.

South Australia and Western Australia set new records late last year regarding the share of renewable energy on their grids, which shows that this trend will likely continue well into 2023 and beyond. An increase in the adoption of renewable energy could also be seen in more companies in  2023 as organisations realise the benefits of clean energy, including energy security, cost savings, and reduction of carbon emissions. Will 2023 see the end of or a truce in Australia’s lengthy political climate wars?

A Big Year Ahead 

A changing and dynamic political and business landscape in 2023, will impact every business and organisation. Anticipating and adapting to this environment will mean that you and your organisation should have a strong focus on these major trends. They will continue to shift and transform with little advanced warning. Flexible tactics within your engagement strategy will be the key to successfully navigating this year and reaching your goals in 2023.

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