Red Tape: A Growth Industry
As two Coalition Governments focus on increasing efficiency in the public service, a new report warns us that bureaucratic waste is dangerously high. By Fred Pawle.
You don't need to have applied to open a coal mine in Queensland's Galilee Basin to know that Australia's government departments are often obstructive and in constant need of reform.
Waste and inefficiency in this era of burgeoning bureaucracies are apparent even at the micro level, where interactions between the public and their so-called servants are often rigid, time-consuming and even pointless.
A report by senior Commonwealth Bank economist Gareth Aird confirms what anybody who has spent time on hold to a government department or had an official form rejected because it was completed in the wrong-colour pen already knew, and he has measured it in a way to which ordinary citizens can relate. “General government consumption growth has materially outpaced household consumption growth over the past four years,” he says.
But that’s not all. “Public sector jobs growth has significantly outpaced private sector jobs growth over the same period… (and) Australian workers continue to hand over an increasing proportion of their income to fund the lift in public consumption.”
These public sector jobs are seemingly in the most counterproductive areas: setting policies, overseeing government programs, collecting revenue to fund government programs, creating statute laws and by-laws, creating case law through the courts, and distributing public funds.
Aird makes a rare foray into politics for a Commonwealth Bank economist. “We are not in the business of pushing a policy agenda,” he says. “But the trends in employment and consumption from a public/private sector perspective point to the need for some of the disparity to be narrowed. Slowing the rate of growth in general government expenditure while providing income tax relief for households would seem a logical and equitable step in the right direction.”
At a landmark speech during a lunch hosted by the MRC on Friday, NSW Premier Gladys Berejiklian said her Government had already made the war on inefficiency a key focus for its third term. “If we are serious that the citizen, or the customer, is at the heart of everything we do, we need to make the customer our central focus across every single part of government, no matter where they live or what their circumstances may be,” she said.
She cited examples of how her government had reduced the time and complexity required of ordinary citizens to interact with the bureaucracy, and said this reduction remained a constant objective. “Innovation in government services is now core business,” she said.
Prime Minister Scott Morrison announced a similar strategy four days earlier, declaring that he would start to look at federal red tape not from the government’s perspective, but from business’s. “We will identify the regulations and bureaucratic processes that impose the largest costs on key sectors of the economy and the biggest hurdles to letting those investments flow,” he told the Chamber of Commerce and Industry in Perth.
But separating essential operations from the self-interest of sinecured pen pushers is not easy, a task made no simpler by the fact that all public servants speak in the same turgid jargon.
Consider, for example, the “Australian Government Contract Reporting Inquiry Based on Auditor-General’s Report No 19”, which was established in December 2017 to examine the pros and cons of hiring expensive short-term consultants to do the work that was once solely performed by full-time public servants.
Submissions to the inquiry generally fell into three groups.
First, the consultants themselves argued that their own work was brilliantly innovative, seamlessly implemented and ridiculous value for money.
Second, the departments mostly reserved the right to make their own calls regarding consultants. The Public Service Commission, using the aforementioned jargon, summed this up by saying government departments should have “effective workforce planning strategies in place to ensure they can make appropriate resourcing decisions” and that “in the Commission’s view, when to use consultants and contractors is determined on a case by case basis”. You don’t say.
And finally were the public service employees, one of whom, a union representative, anonymously complained that “insecure employment affects families by making it impossible for people to secure housing finance and plan for the future”. As if being a public servant inured you from the vicissitudes of life.
Where you stand between these three parties is not the issue here. What is the issue is what happened to the inquiry. It was abandoned.
A government inquiry into government efficiency, which sought and received 59 submissions and held three public hearings in Canberra, decided not to produce a report. “This inquiry lapsed when the Joint Committee of Public Accounts and Audit ceased to exist at the dissolution of the House of Representatives on Thursday 11 April 2019,” the inquiry’s web page says. The inquiry is now a symbol of the inefficiency it was meant to address. Prime Minister Morrison has some low-hanging fruit to pluck in his crusade against red tape and government waste.
Not all public servants and government functions deserve the scorn of taxpayers. No less a robust capitalist as Robert Menzies knew the value of a decent public (or civil) service. “The Civil Service in this country consists of an honourable body of men, of a level of capacity not inferior to the level of capacity in other undertakings,” he said in 1960. “Let us not be too quick on the draw when we are dealing with the Civil Service.”
It would be churlish to repeat here one of the countless quotes in which Menzies also expressed the contrary view, that governments create no wealth and become sclerotic on the hard-earned wages of private workers. Aird's Commonwealth Bank report is enough of a reminder that government expenditure and a burgeoning public service need constant monitoring.
As Premier Berejiklian has shown, it is possible to nurture the public service while maximising its efficiencies. Other governments should take note.