A former Treasury head has told a historic coalition of business, unions and welfare lobbyists that the equivalent of a recession is looming in the next decade unless Australia boosts productivity.

Amid calls for warring politicians to get on with vital reform, Martin Parkinson told the National Reform Summit in Sydney on Wednesday that unless Australia acted quickly, it would sacrifice over 10 years as much as 5 per cent of the economy in missed economic growth, equal to a recession.

Dr Parkinson warned that Australia was "sleepwalking into a real mess".

Opposition Leader Bill Shorten used the summit to soften his line on workplace relations, promising to work "collaboratively in reforming industrial relations in construction and major projects".

His olive branch came ahead of a decision by trade union royal commissioner Dyson Heydon on whether to disqualify himself on the ground of perceived bias, due on Friday.

Employment Minister Eric Abetz said if Mr Shorten were serious he would start by agreeing to re-establish the Australian Building and Construction Commission.

Reprising the famous economic summit of 1983 in which the then king of consensus, Bob Hawke, brought the nation together to embrace structural reform, the National Reform Summit was sponsored by fierce competitors Fairfax Media and News Corp.

It included peak business bodies such as the Business Council, the Australian Chamber of Commerce and Industry, and the Australian Industry Group, as well as the ACTU, the Australian Council of Social Service and scores of policy think tanks, academics, and commentators.

Victoria University economic modeller Janine Dixon told the summit the Treasury's Intergenerational Report painted a rosy picture of the future, projecting average growth in real income per person of 1.4 per cent, meaning that by 2055 Australians would enjoy real incomes 75 per cent higher.

Her own modelling had real incomes growing by less than 1 per cent per year, meaning that by 2055 incomes would be only 44 per cent higher.

"Put another way, it would take an extra 20 years to reach the income forecast in the Intergenerational Report for 2055," she said.

Prominent economist Ross Garnaut said the official figures on productivity were misleading, boosted by hundreds of billions in capital investments.

"The problem is more urgent and more severe, and all of the solutions are long-term," Professor Garnaut said. If Victoria University's projections were correct, Australia would not achieve the 2020 surplus promised and would instead face "ever increasing budget deficits".

Dr Parkinson said if economic growth remained nearer to 2.5 per cent than 3 per cent, as much as 5 percentage points of gross domestic product would be lost over the next decade. It might mean "willingly accepting the impact of a recession".

"We are actually going to find ourselves sleepwalking into a real mess," he said.

Treasurer Joe Hockey appealed to the delegates to make bold suggestions for reform, but said it had to be reform the public could understand and embrace.

"The community is not against change. It just wants to make sure that reform has a purpose," he said.

There was near-unanimous agreement among the 90-odd delegates that Australia's system of superannuation tax breaks was skewed to high earners at the expense of productivity.

"Super is not where we intended it to be," Dr Parkinson said. The system helped build wealth for some rather than retirement incomes more generally.

Dr Parkinson challenged the union movement to agree to boost GST, saying it had already conceded the point by endorsing a broad-based payroll tax which would have the same effect.

ACTU president Ged Kearney said there were other tax reforms that were much more important.

"What about a resource tax, what about a Buffett rule [named after investor Warren Buffett, who wants high-income earners to pay a minimum rate of tax], what about a tax on banks?" she said.

"You say put these things on the table, I say let's look at these other things."

Mr Hockey rejected changes to the tax on super almost immediately, saying that volatile sharemarkets meant now was "not the time" to hit retirees with a new tax.

The summit attacked politicians on both sides for taking ideas off the table, while agreeing on a raft of principles which included a recognition that the reform task is now urgent, that economic growth is too low, and that poverty is too high in pockets of Australia.

Noting the increasingly disruptive role of technology in markets, the parties agreed that key factors required immediate attention.

These include:

A radical re-investment effort in vocational training, where the drop-off in apprenticeships will lead to shortages of skilled labour.

A priority list of shovel-ready infrastructure projects with the capacity to fast-track approvals while protecting the environment and ensuring value for money.

Special assistance for the long-term unemployed including new upgraded training and job placement.

In another significant contribution to the National Reform Summit, Reserve Bank governor Glenn Stevens said the case for economic restructuring would only be embraced by voters if framed in terms of its end-stream benefits.

He said reform was a concept used by elites and politicians but that "the general public was "much more likely to grasp, intuitively, a conversation about growth".

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