Stop the Bloat
By Nico Louw
First published in the MRC’s Watercooler newsletter. Sign up to our mailing list to receive Watercooler directly in your inbox.
Cutting government waste and inefficiency should have bipartisan support. In Australia, recent research showed that voters in favour of cutting waste from the public service outnumber those opposed by more than 2.5 to 1 (51% support; 19% oppose).
Even in the US, a recent Harvard-Harris poll found overwhelming support for cutting Government expenditure, including amongst Democrats. That didn't stop Arizona’s Democratic Attorney-General calling plans to crackdown on government waste ‘a coup, plain and simple’.
In their haste to condemn a Republican crackdown on waste, many commentators will have missed a speech given by UK Labour PM Keir Starmer last week on “fundamental reform of the British state”. It’s worth reading in full.
Some of Starmer’s choice quotes include:
At the moment the state employs more people than it has in decades. And yet – look around the country. Do you see good value everywhere? Because I don’t.
I’m going to send teams into every government department with a clear mission from me to make the state more innovative and efficient.
We don’t want a bigger state, or an intrusive state, an ever-expanding state.
Politicians chose to hide behind a vast array of quangos, arms length bodies and regulators, you name it. A sort of cottage industry of checkers and blockers.
Democratic accountability is [being] swept under a regulatory carpet.
Starmer even committed to abolish NHS England to reduce bureaucracy, cutting 9,000 jobs. Imagine the Mediscare campaign that his Australian Labor counterpart would mount in response to such a decision.
Starmer recognises that, in the face of great geopolitical and economic uncertainty, it would be irresponsible not to ensure that Government is operating at its absolute best to deliver for its citizens. In his words, improving efficiency and cutting waste and red tape is about enabling the public service to operate at “max power”.
The same is true here.
That’s why ahead of the election, the Menzies Research Centre is releasing a new report, Stop the Bloat, with what should be uncontroversial recommendations to cut red tape and regulation, reduce wasteful spending and improve the efficiency of Government.
Consider a business the same size as the Government, a business with $730 billion in expenses a year that employs 360,000 staff. A business of this size would obviously need to focus significant, ongoing effort on reducing waste to remain efficient and competitive. Over time, some expenditure and staff would no longer be necessary or could be reprioritised.
The key word here is ongoing. One-off cuts to wasteful spending are a good start, but would do little to change the dynamic in the public service. We need to change attitudes and systems in Canberra to achieve efficient Government over the long term and ensure Australia is best-placed to face the challenges ahead.
Fixing this problem shouldn’t be complicated and doesn’t require the oversight of a billionaire or a DOGE. What we do require is a plan to use our Australian Westminster system of Government to drive the necessary changes across the bureaucracy.
In our view, the underlying problem is relatively straightforward: no one has an incentive to reduce waste or make Government more efficient because no one is actually responsible or accountable for making it happen.
This is why, while our report has many recommendations, the key ones are equally straightforward at their core - the Government must put someone, ideally a Minister, in charge of red tape reduction, stopping waste and delivering a more efficient Government. Doing so is a necessary first step to restoring accountability to decision making so that the Government can better serve Australians.
As a first priority, these Ministers must work across all areas of Government to stem the flow of red tape and waste. They should conduct vigorous and wide-ranging audits of red tape and wasteful spending, establish efficiency benchmarking of key public service functions, and enact a hiring freeze.
Most importantly, this needs to be an ongoing priority for Government, or the waste and inefficiency will return. This is why our report also recommends these Ministers be responsible for annual red tape reduction targets, stronger Ministerial oversight of grant expenditure, improved technology and AI use, and a robust drive to improve efficiency in state governments.
Calls to improve the efficiency of Government are often met with scare campaigns alleging that all parts of Government are necessary and that any counterview means cuts to essential services. However, denying that there is some level of inefficiency in Government is simply not tenable.
Ignoring this important issue leaves all Australians to pay the price of ever increasing inefficiency and waste.
