On Monday, NSW Premier Morris Iemma announced that "NSW needs a plan". He promised to develop a plan to provide direction for the government and set benchmarks in the delivery of health, education, transport and police services.
In his nine-page speech, Iemma variously described the plan as a "road map", a "blueprint", a "game plan" and "a guiding document for the entire public sector". Even better, he said the plan would be "holistic".
The obvious question to ask is what has the NSW Labor government been doing for the past decade? Without a plan how has the NSW government, with its budget of $40 billion and a staff of 300,000, been able to operate? And in the absence of any performance standards, how can the success or otherwise of the government's activities be determined?
Iemma's comments raise the issue of whether Labor in NSW even knows what its purpose is anymore -- or is it the case that his government is aiming only at power for its own sake.
This assessment of state politics might be depressing, but it is hardly surprising. What is surprising is that in the course of his announcement Iemma expressed his bewilderment that in the bureaucracy there did not exist a strong "culture of public service" and that government departments did not necessarily put "the customer first".
He lamented that this situation persisted despite the fact that public servants (and politicians) had "honourable motivations" to "do good and make a difference".
Either Iemma is hopelessly naive, or he is ignorant of "public choice" economics, or both. The assumption that bureaucrats always act altruistically and selflessly and only ever out of a desire to provide for the greater good is perhaps one of the greatest frauds ever perpetrated on an unsuspecting public.
It is a myth that dates back to the beginnings of a professional civil service in Britain in the 1840s, and it serves to enshrine bureaucratic and government power.
By the end of the 1950s, after decades of the growth of government, evidence had mounted that this myth, like all other myths, had little connection to the real world. "Government failure" was as big an issue as was "market failure". In 1962, two economists -- James Buchanan (the winner of the Nobel Prize for economics in 1986) and Gordon Tullock -- published the classic work of public-choice economics, The Calculus of Consent. Its argument was simple -- public servants and politicians can be as self-interested as the rest of us.
Public choice applies the lessons of economics, especially as they relate to incentives to public policy.
Like any other individuals in any other sort of employment, public servants and politicians can behave in the way idolised by Iemma -- but often they don't. This insight is at the core of public-choice theory.
A public servant whose task it is to alleviate a particular social ill certainly might wish to have that problem solved for the benefit of the community.
But if that public servant succeeded in solving the problem it might result in the budget they managed being reduced, their employment classification being downgraded and ultimately them losing their job. Therefore there are also strong personal reasons as to why that public servant would not want to solve the problem. Worse, that public servant has an incentive to actually exaggerate the scale of the problem in order to get more funding and so improve job security.
This might appear to be a cynical explanation for the behaviour of the public service, but it is realistic. In addition, it helps explain the origin of the endless warnings of environmental and social "crisis" from taxpayer-funded researchers and scientists.
Inevitably, according to these researchers and scientists, the best way to overcome a crisis is to spend more taxpayer funds.
Public-choice theory reveals that the policy choices made on behalf of the public by government, supposedly for the benefit of the public, can sometimes be the self-interested private choices of politicians and public servants.
There's little or no accountability for the quality of public services because it is not in the interests of the public servants managing those services to be accountable to their ministers, to the electorate, or to anyone else.
Until Iemma recognises this, any "plan for NSW" will fail.
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