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The prevailing narrative about Australian economic policy -- one pushed hard by the Coalition, the business sector, conservative think tanks and the mainstream media -- is that industrial relations is the key area of reform and one where major gains are to be had.

The narrative defies the evidence. The government's own Productivity Commission (PC) review of industrial relations found the current system working well and flexibly, and failed to find any evidence that industrial relations reform would increase productivity.

One of the few recommendations the PC did venture to make -- to reduce penalty rates -- turned out to be a dud, with no additional jobs created as a result.