Edition 04: Renewing Outdated Systems (ft. Allegra Spender, Tim Nelson & more)
Our fourth edition, with essays from Allegra Spender and the NEM Review Panel, focuses on renewing outdated systems in support of a more prosperous Australia.
In the fourth edition of Inflection Points, four pieces unpack what it takes to renew outdated institutions for a modern Australia. These feature essays are:
Rewarding Effort in Taxing Times by Allegra Spender.
Rewiring Incentives by the Independent NEM Review Panel (Tim Nelson, Paula Conboy, Ava Hancock & Phil Hirschhorn).
Liberal Foundations by Keith Wolahan.
The Generous Country by Ryan Ginard.
Rewarding Effort in Taxing Times
Allegra Spender argues Australia’s personal tax settings are breaking Australia’s intergenerational compact: labour is taxed harder than capital, bracket creep quietly loads more burden onto working-age Australians, and the system increasingly rewards structuring over effort. This has created an economy where younger Australians struggle to build wealth or buy a home without family help.
Spender argues that the time for talking about tax reform in vague generalities is over: Australia is overly reliant on income taxes, and with a shrinking worker-to-retiree ratio, bracket creep is pushing governments toward ever-higher effective tax rates by default.
To address this, she puts forward a budget-neutral proposal, with five parts:
Cut income tax rates by 2.5–3% across every income bracket.
Introduce a minimum tax rate on investment earnings to reduce trust income-splitting.
Lower the CGT discount from 50% to 30% to reduce property bias while preserving investment incentives.
Ring-fence investment deductions so losses can only offset investment income.
Adopt a principled, stable approach to taxing superannuation.
Allegra Spender is the independent federal MP for Wentworth.
Rewiring Incentives
The authors of Australia’s recent independent review of the NEM argue that our energy market lacks the investment tools required for the next era. Renewables have risen fast (from 8% penetration in 2010 to 43% today), yet much of that build has depended on government policy, rather than durable market signals.
They contend that the links between the NEM’s three time horizons (dispatch, derivatives, and long-term investment) are weakening. While investors need long-dated certainty, retailers prefer shorter contracts. That mismatch creates a “tenor gap,” which government underwriting has partly bridged, yet often by crowding out private contracting, weakening liquidity and price discovery.
They propose repairing the NEM rather than replacing it: expand visibility and participation of consumer resources, help the derivatives market adapt to a variable-renewables era, and introduce a new market-linked Electricity Services Entry Mechanism (ESEM) that provides long-term investment incentives and bridges the tenor gap.
Tim Nelson, Paula Conboy, Ava Hancock & Phil Hirschhorn led the independent review into Australia’s National Energy Market.
Liberal Foundations
Keith Wolahan argues the Liberal Party’s urban problem is structural, not cyclical: the party has been “forgotten” in the metropolitan seats that decide Australian elections, with losses concentrated in diverse middle and outer suburban electorates that remain major-party battlegrounds.
He identifies three forces driving the Liberals’ failure: First, migration has reshaped city electorates; second, rates of higher education attainment have grown sharply; and, third, collapsing home ownership is eroding the behavioural foundations of stability and aspiration that once pulled voters centre-right.
Wolahan argues renewal should be multifaceted, by:
Re-establishing historically liberal values for the modern day.
Focussing on recruiting candidates of competence and character.
Investing in organisational capacity of the party (e.g., via fusion teams).
Adopting policies on tax, housing and migration which restore credibility in cities.
Keith Wolahan is a barrister and the former Liberal Member for federal seat of Menzies (2022-2025)
The Generous Country
Ryan Ginard argues that the future of Australia’s prosperity will not be secured by luck, but generosity. A generous nation invests early and faithfully in its citizens, its communities, and its future, creating resilience that compounds over generations. If luck made Australia wealthy, then generosity is what will keep it so.
To turn aspiration into strategy, Ginard outlines four practical shifts to “double giving” and make generosity durable.
Reform the Deductible Gift Recipient (DGR) system with a principles-based framework that expands eligibility and reduces complexity
Adopt globally common giving vehicles (including options suited to retirees and everyday givers)
Harness the $5.4 trillion intergenerational wealth transfer by normalising planned giving through advisors and new cultural expectations
Build absorptive capacity so smaller charities can safely take and deploy large gifts
Ryan Ginard is the Head of Sector Development at the Minderoo Foundation and the founder of Fundraise for Australia.
Update: The Inflection Points Writing Prize
Last month, we announced the inaugural Inflection Points Writing Prize. This $5,000 cash prize will be awarded to the best new piece of Australian writing about the big problems our nation faces, and the solutions within our grasp.
The Prize can be entered directly until June 30, 2026. Up until March 27, we will also be taking pitches, for writers who want to scope out whether their idea is the right fit for the Prize before dedicating time to writing it.
Our recent impact
We want to conclude this note by reflecting on the impact of Liberal Foundations, the feature piece of this edition which we released three weeks ago.
Keith’s piece was covered by almost every major media outlet, including the Financial Review, the Sydney Morning Herald, the Age, the Herald Sun, the Australian, Sky News (twice), ABC News, the Guardian and the Saturday Paper.
Keith’s piece is exactly the type of writing which Inflection Points believes has been missing from Australia’s national debate. And we’re glad it’s had such an impact. Subscribe now to stay up to date with the latest long-form writing about Australia’s future.
Share
Reform begins with ideas; and we hope you’ll help us share them. If you think someone you know would enjoy Inflection Points, please forward this email or direct them to our website.
– The Inflection Points Team