More money. Better results?

A government can announce a billion dollars in seconds. Delivering a billion dollars of value takes considerably longer.

That gap matters this October.

In France, protests over living costs and public services have spilled into violence.^[1] In financial markets, lenders have demanded higher returns to finance the French state. Citizens and investors are expressing different frustrations with the same institution: one wants better results; the other wants confidence the bills can be paid.^[2]

For Australia, the uncomfortable question is whether we are learning from that tension—or gradually building our own version.

World: how much government is enough?

Here is a figure worth sitting with: French government spending amounted to 57.2% of GDP in 2025. Nearly €60 of public expenditure for every €100 of annual economic output. That includes pensions and benefits, so it does not mean government itself produces almost 60% of the economy. It does show the scale of resources passing through public budgets.^[3]

With spending that substantial, taxpayers are entitled to expect considerable value.

Yet France’s unrest has included grievances over education, living costs and the quality of public services. The size of the budget has clearly failed to settle the argument about what it delivers.^[1]

This raises a harder question than whether governments should spend more or less: would the next dollar create greater value in public hands, or left with the household or business that earned it?

Private businesses usually face a direct financial consequence for getting that decision wrong. Customers leave. Margins shrink. Investors withdraw funding. Eventually, an enterprise that persistently consumes more value than it creates runs out of money.

Those pressures are imperfect. Competition can be weak, businesses can waste capital, and essential services cannot always be judged by profit. But the possibility of failure gives private investment a discipline that public programmes often lack.

Governments face elections, audits and parliamentary scrutiny. However, a poorly performing programme can survive for years when its benefits are concentrated, its costs are spread across millions of taxpayers, and closing it creates more political pain than continuing it.

The risk is that spending becomes easier to defend than results.

Borrowing can postpone that reckoning, but it comes at a price. France’s ten-year bond yield briefly exceeded 5% on 21 October, its highest level since 2002.^[2]

An easily missed detail: governments do not need to borrow more for interest costs to rise. Refinancing old, cheap debt at higher rates can increase the bill even before new spending is added.

Inflation, monetary policy and political risk also move yields. Nevertheless, persistent deficits leave governments more exposed to whatever price lenders demand.

Australia: productivity starts with the rules

Australia’s problem is less dramatic, but the arithmetic deserves attention. Labour productivity fell 0.2% over the year to June 2026, according to the Productivity Commission. Hours worked increased faster than output.^[4]

We worked more without getting proportionately more done.

That matters because lasting improvements in purchasing power depend on our ability to produce more value from our time, skills and capital. Increasing taxes can transfer resources to government. It cannot, by itself, make those resources more productive.

Imagine a business considering a new machine. The owner must weigh its cost against the additional output it could generate. Tax takes part of the money available for that investment. Government may put it to better use—perhaps through infrastructure that benefits thousands of businesses—but that outcome needs to be demonstrated.

The comparison is between two possible uses of the same scarce resources. A dollar spent publicly is a dollar unavailable for private consumption, saving or investment, unless funded through additional borrowing—with obligations attached.

This is why productivity belongs on the desks of premiers as much as the Prime Minister.

Canberra shapes taxation, competition, migration and workplace policy. States and territories oversee major planning, licensing and service-delivery systems. Councils administer local approvals. A business experiences their combined effect.

A federal investment incentive loses value if a state approval stalls the project. More skilled migration achieves less if workers cannot promptly use their qualifications. Housing funding disappoints when infrastructure and planning fail to align.

The Productivity Commission has identified accumulated regulation and approval delays as obstacles to investment and business growth.^[5]

Government can lift productivity by delivering useful public assets and making productive private activity easier. Both require discipline: clear objectives, credible evaluation and a willingness to stop doing things that fail.

The question worth asking

There will always be worthy demands for more funding. There will always be political rewards for promising it.

The tougher task is proving that another tax dollar will deliver more value than taxpayers could have created with it themselves.

Before governments ask us to contribute more, have they earned our confidence in how they spend what they already receive?