Thursday, September 30, 2010

Labor's wrong direction on reform

Julia Gillard told us last week why it is imperative to get the legislative program started.  Unfortunately, absent from this was the need to put Parliament to work removing the crushing regulatory and tax burdens the government imposes.  Instead, she promised us new and expanded quangos, with their collateral damage of an increased public service staffed by people attracted away from productive activities.

Gillard's legislative agenda foreshadowed one new bureaucracy to set national safety and quality standards for Australia's hospitals and health services.  Another is to improve access to services and representation for university students.  And there's to be a body for ''national preventive health''.

Her plans also include more bureaucratic controls over the ozone layer, a danger that seemed to have been downgraded.  Also in the mix is water efficiency labelling, and more powers for bureaucracies regulating therapeutic goods and fighting corporate crime.  The government wants parliamentary legislation to be required to take into account the many ''human rights'' that international agencies invent at the drop of a handkerchief.

The Prime Minister calls this a reform agenda, and adds, ''this legislation ... step by step ... will make a difference to the lives of families across Australia''.  As Ricky Gervais's Andy Burnham might say, ''Is she having a laugh?''  Sadly not.

By reform, Gillard means adding to the 7000 pages of regulations comprising hundreds of thousands of ways the federal government interferes with the decisions of businesses and individuals.

It may be that in the present Parliament she will find it easy enough to resist embarking on the big-ticket programs favoured by her Greens allies and most of the Labor Party.  A Gillard government on a knife edge is unlikely to court needless risks by promoting contentious matters.

The stage is set for procrastination in the introduction of one of the many versions of a carbon tax on the agenda.  Lots of pictures of beaming ministers, Greens and independents, a newly forged quadruped of ALP-favoured advisers, and something to rehash for the under-occupied Climate Change Department.

Wheel-spinning inaction is also likely on the proposed new minerals tax.  At least those parts of it that involve net tax increases will be subjected to endless reviews now the agenda is under the control of Martin Ferguson and the ALP commonsense Wing.

Similarly, notwithstanding her previous support, Gillard is unlikely to want to court the contention inevitable in a euthanasia bill.

But the carbon tax and minerals tax will remain as a sword of Damocles over business investment, and the waste of the national broadband implementation will sap resources for productive investment.  And the new voices in the Parliament will seek further raids on the community to finance their preferred interventions and boondoggles for constituents.

One bright spot has been the stated determination of new Finance and Deregulation Minister Penny Wong to return the budget to surplus.  The Finance Ministry's role as the guardian of unnecessary spending and regulation would seem to be admirably suited to Wong's personality.  But expressions of determination have to be followed through.

For all her bluster, Wong has not sought any tips for handling the job from Peter Walsh, the finance minister who did much to keep the Hawke government's accounts in shape.

The government that Kevin Rudd built, though shorn of its Messianic fervour, remains intact.

''Reform'' has been redefined to mean any change that increases the ability of the government to shift the economy and society in its preferred directions.  Compared with the Hawke/Howard years, doubles peak has transformed reform's meaning from removing government from decision making to more securely ensconcing it.

Lip service is paid to the need for parsimony in government spending but the education minister who was responsible for the greatest spending excesses is now the Prime Minister and the climate change minister who sought to preside over a vast increase in taxation and regulation is now the Finance and Deregulation Minister.


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