CPDS Home Contact Professionalism: Chronological Summary

Email sent 20/1/08

Mike Steketee

'How PM's red tape will bind recalcitrant states'

Unfortunately your recent suggestion that more Commonwealth Government red tape is likely to solve problems in Australia's federal system seems unrealistic.

My interpretation of your article: Kevin Rudd's style is reminiscent of Hawke - involving consensus politics and managerialism. He is an activist, but not a risk-taker. In federal-state relationships he has the potential to make a mark. This is the main outstanding area of economic reform. Rudd intends to drive change through federal-state cooperation in COAG. He has set high standards for COAG's achievements (eg specific targets for elective surgery delays; guarantees of early-childhood education for all 4 year olds; halving the numbers of homeless turned away from shelters; halving gap between mortality rates / literacy of aboriginal and other children). The first COAG meeting came out with a vast number of performance measures. Seven working groups were established, and there will be four meetings per year. Ministerial chairmanship of working parties will reduce scope for bureaucratic inertia. If cooperative federalism doesn't work with 9 governments of the same political persuasion, it will have failed. Rudd has faith in such a process because, as senior bureaucrat under Goss Government, he was a key player in one of its rare successes - competition reforms under Keating Government. He expects that Commonwealth incentive payments will be the bait that gets states to agree. However this cooperative phase may not last, and (for hospitals) the Commonwealth may assume full control if cooperation fails (Steketee M., 'How PM's red tape will bind recalcitrant states', Australian, 10/1/08).

The process you describe reflects little understanding of what is required to make government work effectively. It is hard to know where to start. But here goes.

Managerialism involves the notion that 'senior' officials merely need to be 'managers' and don't require a depth of knowledge of the function they are managing. That this has been a poor assumption can be illustrated by the fact that (as your article noted) Queensland's Goss Government had few successes (eg see Toward Good Government in Queensland, 1995; and Queensland's Worst Government?, 2005).

The heavy-handed approach to government machinery and centralization of policy which characterised that administration were then combined with a (so called) 'cooperative' approach to planning SE Queensland's growth to produce a politically driven planning process. This seems to have some parallels with what is now intended for COAG. That experiment proved anything but a sparking success. Informed observers described it as merely a pretence at planning, and resulting in a huge increase in emphasis on process with few results.

The whole politically-focused centralised process of developing solutions to Australia's problems in Australia's federal system that is now intended seems unlikely to produce pragmatic and effective reform proposals - because it has divorced the development of those proposals from persons with the detailed / practical knowledge and experience required to competently produce them (see 'One big Labor party': Great Fun but there will be a Hangover, 2008).

In particular defining performance measures that states have to measure up to reflects a failure to appreciate the complexity of functions that suffer market failures and thus tend to be government responsibility (see Mr Impractical, 2007). When one defines measures in dealing with complex public functions, they are likely to be achieved just as one discovers the critical importance of some measures that were not defined. Financial performance measures were defined for Queensland's electricity industry - but investment in network renewal was not one of them. Performance measures were defined for Queensland's supply water system - but they involved no recognition that SE Queensland's major water storage had never been designed for water supply (but rather for flood mitigation).

There is considerable doubt that the National Competition Policy (NCP) has been as successful as suggested. It suffers economic limitations because (a) competition does not in itself ensure the capabilities to compete successfully in high value added activities, and (b) there can be systemic obstacles to success - eg in poorly developed regions. NCP also had adverse effects on the capabilities of governments because the real nature of governing (as compared with running a large business) was simply not considered. These points are considered further in Review of National Competition Reforms: A Commentary (2004).

The chance that the PM's 'red tape' will lead to improved public administration in Australia is unfortunately nil.


John Craig