I acknowledge the Gadigal of the Eora Nation. I pay my respects to Elders past and present and extend that respect to First Nations people taking part in today's event.
Fresh out of law school, I had the privilege of working as one of Justice Michael Kirby's High Court associates. I answered the phone, put thousands of letters in envelopes, made hundreds of cups of Ceylon Orange Pekoe tea and occasionally had the chance to do some legal research (Leigh 2016).
One of the things I learned was that lawyers would be lost without resources like Corones' Competition Law (Svetiev 2023). Pages dog‑eared and tabbed to death, Corones is a trusted source of how the courts have ruled and how arguments have been won and lost.
Corones texts also stand as a record of reform. Over many editions, it has captured everything from judgments on the original 1974 legislation, to reforms allowing third parties to access infrastructure in the 1990s, to the introduction of criminal cartel sanctions in the 2000s.
And today, a new round of competition reforms takes shape. This includes the new merger regime - the largest shakeup of Australia's merger settings in half a century. And it includes a revitalised National Competition Policy agenda. These are the 2 areas I want to cover today, with a focus on the microdata underpinning these macro reforms.
Building an innovative economy
Ultimately, competition reform is about improving the long‑term prosperity of the Australian people. This means getting the policy settings right if we want to build a stronger, more resilient and dynamic economy.
Think of the end‑game as more like Lego than Monopoly. In Monopoly, one person gets everything while everyone else watches in frustration. In Lego, all the players get to build something - though in both cases, stepping on a piece can be painful.
As US congressman Jake Auchincloss put it, 'Everybody, when they think about playing with Legos, has this sense of creativity and empowerment.' (Klein 2025)
Competitive markets help ensure Australians pay fair prices for goods and services (Leigh 2024a). Without competition, businesses can charge whatever they like - kind of like airport food courts, where a ham and cheese sandwich requires a mortgage.
Competition also promotes choice and freedom.
The challenge is Australia's competitiveness has been declining since the 2000s, while market concentration has nearly doubled since 2010 (Chalmers and Leigh 2024).
Using microdata to get a better picture
The Australian Government's establishment of a Competition Taskforce within the Treasury in 2023 reflects the importance we place on competition reform and finding solutions.
In just over a year, the Competition Taskforce has made significant contributions.
This includes using microdata to identify competition issues and develop tailored policy and regulatory responses (Leigh 2024b).
For example, the Competition Taskforce has relied on data to:
- develop a robust evidence base on the prevalence and use of non‑compete clauses in Australian labour contracts to inform policy (Andrews and Jarvis 2023, ABS 2024)
- provide new and powerful insights into how competition can reduce airfares (Majeed, Breunig and Domazet 2024)
- explain patterns and trends in mergers and show how competition has declined in Australia (Competition Taskforce 2024).
Understanding competition
Unit‑level records that track businesses and households over time allow granular analysis of the way policies are influencing the economy.
Using bigger datasets, more refined econometric techniques and most up to date theories, economists have provided new insights on trends in market concentration and the relationship between competition and productivity.
For example, researchers found an increase in market power partly explained Australia's productivity growth slowdown. Industries with the greatest increase in concentration also had the greatest increases in markups (Hambur 2021).
In this context, high‑growth firms act like Lego builders in the economy - constantly assembling, adapting, and expanding their creations. Rather than dominating like a monopoly, these firms thrive by snapping together innovative ideas, new markets, and fresh talent, driving the majority of turnover and employment growth.
Typically small and young, they grow by more than 20 per cent over a three‑year period, often reshaping the landscape and challenging the older, more rigid structures of established incumbents. Think of them as the startups disrupting the economy - just as streaming services disrupted DVDs, Uber disrupted taxis, and toddlers disrupt your ability to get a full night's sleep. As vital builders of sales and employment, a decline in high growth firms can lead to a less dynamic, less flexible economy (Majeed et al., 2021).
Concentration hot spots
The Competition Taskforce is working with the Australian Competition and Consumer Commission to develop a microdata screening tool to identify concentration hot spots. This innovative tool leverages the increasingly detailed geospatial data that the Australian Bureau of Statistics has added to its microdata assets.
The resulting tool will identify regions or segments of the economy that are already very concentrated, where further market consolidation through mergers and acquisitions poses the greatest risk to competition. Concentration hotspots are like a heat map of where Monopoly is being played a little too well, allowing policymakers to find solutions before someone tries to build hotels on every property.
The Taskforce's use of administrative data to systematically understand economic activity at the local level will be a novel approach to competition policy both in Australia and among our peers. It will complement the Australian Competition and Consumer Commission's thorough knowledge of markets developed through its many inquiries and day‑to‑day experience administering the competition laws.
This hot‑spot tool should help the Australian Competition and Consumer Commission administer the new merger system and inform decisions about the sectors requiring mandatory notification. After all, if a Monopoly player already owns Park Place (or Park Lane), it's best for the other players that they don't own all the other dark blue properties. When monopolists dominate the board, it can be expensive for everyone else in the economy to move forward.
These examples showcase how increased availability of microdata has transformed the way we can use empirical evidence in the policy decision making process: to better identify issues, understand the problems, and develop effective and targeted solutions.
Microdata gives us the tools and understanding to target policies.
National Competition Policy
Building a more productive, dynamic and resilient economy and giving Australian consumers access to a wider range of higher quality products and services at lower prices from across the country and overseas requires collaboration and trust.
That is why Australian, state and territory governments have been working together to coordinate competition reform efforts under a revitalised National Competition Policy agenda.
Almost 30 years ago, states, territories and the Commonwealth agreed to put competition policy front and centre by agreeing to the National Competition Policy following the Hilmer Report. This was the era of economic reform, as well as grunge music, dial‑up internet, Blockbuster video rentals, Tamagotchis, and arguing over whether Ross and Rachel were really on a break.
The original Hilmer reforms outlined a set of competition principles that transformed our economy in ways we largely take for granted today. These included structural reform of public monopolies, introducing competitive neutrality so that government businesses do not enjoy unfair advantages over their private peers, arrangements for third‑party access to nationally significant infrastructure, and an obligation on all governments to review and reform laws that restrict competition.
These reforms, which focused on removing regulatory barriers in the non‑traded sector, were credited with boosting Australia's GDP by 2.5 per cent - equivalent to around $5,000 per household per year today. That's basically the economic equivalent of finding an extra $50 in your jeans - twice a week, every week.
Commonwealth, state and territory treasurers agreed in November to revitalise National Competition Policy to drive growth, improve choice and put downward pressure on prices (Chalmers 2024). Renewing the government's commitment to put competition policy front and centre once again but tailored for the new challenges and opportunities of the modern economy - we're now a digital economy, we're looking for ways to make the transition to net zero at least cost, and we have a growing care and support economy.
We have also updated the original National Competition Principles to drive better outcomes for the community, requiring governments to consider the competition impacts of government decisions and establish protections against poorly managed privatisations, empower consumers and address remaining barriers to the movement of goods, services and workers across the country.
Competition reform isn't straightforward. If it was easy, past governments would have done it already. Competition reform can be like assembling flat‑pack furniture - you know it'll be worth it in the end, but along the way, there's a lot of frustration and some pieces don't seem to fit where they should.
Trajectory of the government's competition reforms
This recommits governments to a new wave of pro‑competitive reforms over the next decade. Work is already underway on a first tranche of 5 priority reforms to ease the cost‑of‑living pressure and reduce regulatory complexity. The 5 pillars are:
- Streamlining commercial planning and zoning systems to improve competition by encouraging firm entry and expansion and reducing business and regulatory costs.
- Lowering barriers to the adoption of international and overseas standards in regulation. As a first step, we are fast‑tracking the recognition of equivalent or superior overseas product safety standards, rather than relying only on domestic standards, to deliver safer and cheaper products. Following this, we will be working collaboratively to identify the priority sectors for the next phase of this reform.
- Supporting modern methods of construction such as prefab and modular by levelling the regulatory playing field with traditional methods of construction, unlocking time and cost savings, overcoming labour shortages and boosting lagging construction productivity.
- A nationally consistent worker screening check to boost labour mobility for care workers.
- Developing broader rights to repair, including for agricultural products, which could reduce repair costs and waste by providing consumers and businesses more choice for repair services.
State and territory reforms are backed by the government's $900 million National Productivity Fund. This allows for the fiscal benefits of these reforms - which mostly flow to the Commonwealth - to be shared with those states and territories that choose to implement them. The idea is to encourage states and territories to undertake meaningful reforms for the benefit of the Australian people and the economy.
And this is just the start. The government will continue to work closely with industry and state and territories to build a more productive economy through national pro‑competitive reform options.
Further reform rounds will be informed by community consultation and the Productivity Commission's 5 new inquiries.
They include inquiries into:
- creating a more dynamic and resilient economy
- building a skilled and adaptable workforce
- harnessing data and digital technology
- delivering quality care more efficiently, and
- investing in cheaper, cleaner energy and the net zero transformation.
Significant benefits flow from National Competition Policy
Significant benefits will flow from a revitalised National Competition Policy.
To help us understand the magnitude of the benefits, the Productivity Commission modelled the impact of 19 potential competition reforms (Productivity Commission 2024).
The Productivity Commission estimated that a revitalised National Competition Policy could result in an ongoing boost to GDP of up to $45 billion, an increase of up to $5,000 for every Australian household per year as well as lower prices by an estimated 0.7 to 1.5 per cent in the long run. This is significant. It is an enduring benefit for consumers, businesses and the economy. On‑par with the highly successful reform efforts of the 1990s and 2000s.
And the benefits of the reforms extend beyond their economic effect. For example, reforms in the care and support economy would increase the quality of care in areas such as health and disability support.
There is tough reform work to be done, but the benefits of delivering meaningful reform speak for themselves.
Closing remarks
I'd like to leave you with this final thought.
When Danish carpenter Ole Kirk Christiansen created his iconic company almost a century ago, he named it LEGO after the Danish phrase 'leg godt', which means 'play well' (LEGO n.d).
Christiansen understood that openness, rather than monopolistic drive, enabled dynamic, productive and constructive play that benefitted everyone involved.
Instead of a blood sport where players knocked each other out one by one, participants benefitted when they could create, learn, collaborate and share ideas.
Today, Lego is the world's most popular toy, with consumers buying over 30 billion blocks per year.
Raising my 3 sons, I found that an afternoon spent playing Lego inspired creativity and laughter. Our evenings spent playing Monopoly often ended in tears.
