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Australia’s Productivity Commission some interesting insights for Indonesia


The Productivity Commission is one of Australia’s most prolific and influential government advisory bodies, providing evidence-based policy advice on a wide spectrum of social and economic issues aimed at raising living standards across society. The paper aims to show how the Commission has become such a prominent actor in Australian policy making, highlighting its origins and the way it is used by the government. The Productivity Commission provides independent, evidence-based policy advice to the Australian Government with the aim of improving living standards for all Australians. The Commission’s profound influence on Australia’s economic and social policy over a long period demonstrates how genuinely independent advisory bodies can help governments make difficult reforms. Essential to the Commission’s ability to sustain its influence has been its ability to preserve its independence. Legislation is important to establish the formal independence of advisory bodies, but the Productivity Commission’s independence also owes much to its institutional culture, the transparency of its inquiry processes, and recognition by politicians that independence underpins the Commission’s credibility and therefore the value of its advice. The Commission’s experience shows that when governments are free to choose which matters they refer to independent advisory bodies, and whether or not to follow their advice, they have little to fear from their independence

The relevance for Indonesia of documenting the experiences and development of the Productivity Commission in Australia lies in the ongoing discussion about the development of think tank functions in Indonesian government organizations. The documentation of the development and growth of the role of the Productivity Commission in policy making in Australia helps to highlight that while establishing and strengthening government think tank and policy research center is a good idea their sustainability and credibility depends also on enabling environment changes that can guarantee the necessary degree of independence from political interferences as well as the funding through the national budget. This does not mean that the Productivity Model can be copied and pasted to Indonesia. However, the Productivity Commission experience and development can inform the discussion on government think tank in Indonesia.

Australia’s Productivity Commission: Providing Independent Policy Advice to Government The working paper in English is here. Working paper in Bahasa Indonesia is here. An Infographic in Bahasa Indoensia is here. A video podcast interview is here.

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