How do you identify which political party governs Australia? There's a simple trick known to every Canberra insider that reveals the shifting attitudes toward regulation.
When the Coalition holds power, you'll see "The Department of Finance and Deregulation". But when Labor takes charge, it quickly reverts to simply "The Department of Finance".
This isn't just bureaucratic semantics. It represents the deep political divide around deregulation that has defined Australian politics for decades.
The global shift in regulatory thinking
The traditional political narrative around regulation is undergoing a dramatic transformation worldwide, and new research shows Australia urgently needs to catch up.
Centre-left governments across the globe are leading this change. In the United Kingdom, the centre-left government has implemented an action plan to reduce regulatory burdens by 25 percent.
Canada's centre-left administration introduced a "one-in, one-out" rule requiring regulators to remove existing regulations to offset any new ones added.
Even the European Union is pursuing deregulation through its Better Regulation agenda, aiming to cut administrative burdens by 25 percent for all businesses and 35 percent for small and medium enterprises.
This represents a fundamental shift in how political parties view regulation. Rather than seeing deregulation as a race to the bottom on worker rights and environmental protections, it's increasingly viewed as the most cost-effective way to achieve policy goals.
Australia's regulatory explosion
New research from Mandala and the Australian Institute of Company Directors reveals the staggering scale of Australia's regulatory problem.
The number of acts of Parliament and legislative instruments remained around 2,200 throughout the 1980s and 1990s. By the year 2000, this number nearly doubled to 4,000. By 2024, it doubled again, increasing 2.4-fold in just two decades.
The volume of legislation has exploded similarly. The number of pages in legislation has almost tripled since 2000.
Perhaps most concerning is the Legislative Complexity Index, developed by the Australian Law Reform Commission to measure how difficult legislation is to understand and implement. This index has increased 2.4-fold since 2010 alone.
The impact on Australian businesses is profound. Corporate boards now spend 2.3 times more hours on regulatory compliance than they did in 2015.
Data from LinkedIn shows compliance-specific roles within businesses have more than doubled since 2010. In sectors like healthcare, education and mining that have seen significant employment growth since 2010, this growth has been driven by compliance roles rather than innovation positions.
The staggering $160 billion cost
Researchers used three different estimation methods, all pointing to the same conclusion: regulatory compliance costs Australian businesses $160 billion annually, representing approximately 5.8 percent of GDP.
To put this number in perspective, the microeconomic reforms implemented under Prime Minister Paul Keating - widely considered the most significant in Australia's modern history - increased Australian GDP by 2.5 percent according to Productivity Commission estimates.
This means the regulatory growth over recent decades has effectively wiped out all the gains from these landmark reforms - twice over.
Australia's regulatory burden is significantly worse than other OECD countries. We're more than twice as burdened as the United Kingdom, and our regulatory complexity is growing much faster.
Critically, there's no evidence Australians are receiving better outcomes in return for this regulatory overload. Whether measuring overall productivity or practical metrics like the time required to obtain construction permits, Australia performs poorly compared to international peers.
Solving the productivity paradox
Economists have long puzzled over the "productivity paradox" - why technological advances haven't translated into stronger productivity growth.
This research suggests the answer might be simpler than expected. While computing power and innovation provide productivity gains, excessive regulation from Canberra cancels them out.
Simple solutions include raising reporting thresholds and climate disclosure requirements to shield small and medium businesses from the heaviest compliance burdens.
However, researchers argue more fundamental institutional changes are needed: stronger scrutiny of new regulations, mandatory post-implementation reviews, national harmonisation to eliminate overlapping rules, and separating regulatory enforcement from policy development.
As Adam Triggs, partner at Mandala and author of the research, concludes: "What computing gives, Canberra takes away. A new approach can't come soon enough."
The politics of deregulation are changing globally, and Australia has both the evidence and the imperative to join this transformation.
