The submission suggests a more realistic outlook on the inherent uncertainty of the future is needed and warns of over-regulation in response to the GFC.
Head of financial services at PwC, Hugh Harley said inherent uncertainty of the future means the prospect of systemic crisis is a reality with which we have to live.
"The worst possible outcome from the GFC would be to discourage legitimate risk-taking. Trying to regulate that risk out of existence would be the death-knell for economic progress," he said.
"Finance must be directed to the best and highest uses and our financial system needs to be sufficiently robust to withstand the inevitable stresses and surprises of coming decades. This requires consistent economic growth, genuine productivity improvements and sound Budgets," added Mr Harley.
Key messages in PwC's submission include:
• Investment needs to be driven towards genuinely productive parts of the economy and excessive investment in housing avoided
• Australia's fiscal position needs to be repaired to give flexibility to withstand future stresses
• Simple regulation is likely to be much more effective than complex regulation in an uncertain world