The deterioration of Queensland's public administration and the poor quality of the economic outlook are serious threats, which our current political process appears unable to deal with.

Many explanations of the [1995] election outcome have been offered (eg campaign methods, Government style, public sector reform, motorway difficulties, general community discontent). All of these appear partly correct. However all reflect an underlying problem, namely the lack of substance behind Government's policies and claimed performance. Political commentators who consider only stated goals (rather than the feasibility of achieving them) have been unable to identify this problem, thus partly disabling the democratic process as a means for ensuring good government.

The public sector reform process did not produce an effective system of administration. State employees overwhelmingly voted against Government not just because of job insecurity, but because of their worsening working environment. Electoral reactions by the general public reflected concern about poor performance and the uncertain future, rather than failure to explain achievements.

Both the process for restructuring and restaffing, and the establishment of many mechanisms to increase political control, have eroded the skill base of the public sector.

De-skilling was detected very early by public sector employees, but much more slowly by the general public after services were affected (as de-skilling merely increases the rate of errors).

Public awareness of this problem was held back by Government's influence over the media, and by favourable comments by academics (who did not understand the need for experience for implementation to be successful). Both Government and the academics believed their own arguments, and will probably be the last to recognise the problem.

However even more serious consequences affecting high level functions are still concealed, eg ineffective machinery of government, and a weak capability for economic development.

De-skilling occurred because `across the board' restructuring and restaffing was undertaken. It was impossible to identify requirements for competent policy or effective administration from information available in the political system, or from external reviews of departments. Change can only be effective with full co-operation of those with detailed knowledge and experience. The process biased staffing towards those who were compliant, rather than those who were competent. The problem could have been avoided, as safer options were suggested in 1990, but were ignored.

The Government's reform agenda had general staff support in 1989 and was broadly compatible with internal changes made in the public sector during the 1980s. With encouragement the public sector could have been the instrument of reform.

Though politicisation was rejected by the Fitzgerald Commission, by Labor policy and by Government statements, politicisation has occurred. This arose because the public sector was seen as the main problem to be overcome in achieving reform (rather than as an aid to reform). Without real goals, it was even more difficult to assess required competence, and or avoid staffing with persons who are `successful' (ie are frequently promoted because they are politically astute enough to agree with superiors) though they are not effective administrators.

The assumption that the public sector was the problem has proved self fulfilling. Similar difficulties occurred elsewhere in Australia (eg Victoria and perhaps Federally in the 1980s) where Wilenski's theories about how to create a reform oriented bureaucracy have been applied.

Staff competence contributes more to good government than unquestioning compliance does. Wilenski's assumption, that overcoming bureaucratic resistance to change is the main problem, is dubious (as there are many greater real world obstacles to policy implementation which competent officials are more likely to cope with than those who are compliant).

Furthermore, responsiveness to public expectations is aided by competent staff and (in a changing world) political compliance merely reduce administrator's responsiveness to `reality'. Competent staff can be: easier for business and the community to deal with; better able to provide balanced advice; less liable to countenance corruption; and better able to support Government's dealing with East Asia (where deception of the ill informed is normal strategy). Government does not need tight discipline to make tough cut-backs; it needs competence to work out how to make progress.

Government's best economic contribution was assumed to lie in efficient services, and low taxes. These activities have second order economic impact, and have been eroded by de-skilling.

However development of the economy (ie upgrading the real ability of business and the community to support high productivity industries) has not been constructively supported. Queensland's claimed economic success is a mirage. Per capita incomes continue to decline by international standards.

Leadership in direct development of economic agents (eg enterprises) and process (eg for business formation, financing, trade) is vital to maximise productivity and competitiveness so as to prevent more `recessions we have to have'. Reliance on a `free market' is no longer sufficient. Such development can not be led by politically accountable organisations (because the task is to speed up `learning' by the economic system, and political acceptance can only slow it).

There are considerable risks in seeking to respond to rising community expectations (no matter how desirable they may be) without simultaneously increasing public sector competence.

Competence can be increased by encouraging people rather than paper shuffling, and by emphasising `reality' rather than political compliance (eg by avoiding purely structural changes; re-emphasising the public service's role; valuing effectiveness not just efforts; integrating policy with operations; encouraging strategic leadership; using more flexible cabinet processes and a disciplined budget process; and reviewing financial businesses and public sector commercialisation).

Support for serious apolitical efforts to address economic development is also needed to reduce the chance that economic growth will be derailed by a current account crisis.

These challenges are difficult, but political instability could result from failure. A supporting document, Towards Good Government in Queensland, presents this submission in more detail.