Thursday, November 30, 2006

Blogger Problems

Neil, I am sorry that you could not post a comment and thank you for posting on you site.

I knew Neil was having problems posting comments but did know what they were until I tried. It appears that the aplhabet system went down. It also appears to be back on line now. Or it was when I tried it on all blogs.

Please check and if you find it down email me at ndarala(at)optusnet(dot)com(dot) au.

I do apologise.

Blog Management Issues, Search Engine Patterns

I really have to apologise for some of the layout problems in posts. I have been having major formatting problems since I switched across to the new blogger system, especially when I paste material.

I often write quite long articles, much longer than the normal blog format, because I am using the blog as a blog of reflection.

The usual rule of thumb is that a web page should have only 60 per cent of the content of the equivalent printed page to be as easily readable. I often breach this rule. That's bad enough, but it becomes much worse when bad formatting is added in. I have to sort the problem in one way or another.

I have also noted Neil's complaints, here for example, about the difficulties in sometimes accessing the blog. Google has been experiencing periodic problems. Hopefully they will work this one out.

Still on Neil and New Lines from a Floating Life, over recent months I have watched in admiration the steady growth in his blog traffic. It's very well deserved.

Watching Neil inspired me to improve my own site monitoring, putting up bravenet, one of the free site stat packages. I have only a few days stats, but the results have already been instructive.

I created the blog in March as an experiment, little knowing how addictive the whole thing would become. Initially I put up only a few posts, starting regular posts in June, so its all quite new. My gross traffic figures show a steady increase over the period, and that's been fine from my viewpoint.

The new system strips out both search engine robots and my own visits. I also know the source of traffic for the first time. This is not a commercial site so there is nothing confidential about the numbers, nor am I embarrassed about low numbers as such. So I thought that it might be of interest at least to my blogging colleagues if I shared the initial results with you.

The gross site stats that I have show only page impressions. Here the figures have been:

  • July 643
  • August 918
  • September 1531
  • October 2073
  • November month to date 2351

I was and am quite happy with these gross numbers since I could use the month on month figures as a rough guide to increasing traffic.

As an aside, looking back, the most important story that I have written in terms of blog impact was in fact on the New England Australia blog about the death of Alex Buzo (16 August) because of the feedback, bringing me in contact especially with Neil. I find it hard to believe that we have only been in dialogue for three months.

Now that I have some more detailed if still very limited traffic figures I can refine the gross numbers.

If we take 28 November as an example, the gross figure shows 71 page impressions. The more detailed net stats show 53 page impressions from 33 unique (different) visitors. The day before there were 43 page impressions also from 33 unique visitors. While this is miles below Neil's 200 or so visitors per day, I am quite happy with the figures at this stage in the blog.

The numbers are too early for me to measure my regular readership, although it is clear that a lot of traffic comes in through search engines. You would expect this on a site that is already reasonably content rich. However, I was fascinated with what the stats showed me in regard to the things people searched on to find the site.

I have a problem here in that the free package only shows the source of the last ten visitors, so I actually need to record the search engine search queries as I go along to get a real feel. Accepting this, the pattern is much more varied than I would have expected. If we take the search terms people used to find and visit the site in the most recent list they were:

  • gdp australia china (Google France)
  • What do GenY think of baby boomers (Google main)
  • australian idol finale (Google blog search)
  • baby boomers and generation x and travel behaviour (Google main)
  • Brian Barnes one man show (Google Germany)
  • doug belshaws blog (Google UK)
  • rupert murdoch news corp criticism -"OJ" (Google UK)

I have only just started recording, but from passing skims over the few previous lists I noticed:

  • the stories on Australian Idol and the Victorian elections picked up a number of hits and very quickly, so the Google robots must be trawling the site on a daily basis which is very pleasing. Because, in my usual way, the Idol story was a story including a number of names, hits in fact came in mainly on names.
  • drought and rainfall attracted quite a large number of hits from several countries.
  • someone in the UK is very interested in the Belshaw family.
  • then there were quite a few searches on individual topics.

I have only just started recording all this, but as a social commentator I find it all very interesting. In fact, I think that it will give me a whole new source of posts.

Wednesday, November 29, 2006

Public Administration and the AWB - A few more background points

Department Head responses to a question on the objectives of their Departments, 1970's Royal Commission into the Public Service

I have not previously encountered the suggestion of objectives for a department of state. The Royal Commission will presumably not need anything more from the department than a copy of the administrative arrangements. Sir Lennox Hewitt

The function of the Treasury is to advise and assist the Treasurer in the discharge of his responsibilities. The objectives of the Treasury are, in essence, to carry out this function as effectively and efficiently as possible. Sir Frederick Wheeler

I do hate not understanding how things work in areas where I have an interest. Conversely, one of the fun things about this blog is that it requires me to find out so that I can write about them.

As I browsed the Cole Report I realised that I was not sure just how some of the official bits now fitted together. I was also puzzled by the apparent absence of the Department of Agriculture, Fisheries and Forestry (the old Department of Primary Industry) from the scene since I would have expected it to have had a major direct interest.

I therefore decided that I should start by looking first at Agriculture, Fisheries and Forestry. However, I need to make a few more background points first,

First, I have included the quotes at the top of the page as an introduction because they set something of a context for some of the differences between the traditional system of public administration and that holding today that I will be referring too.

You might also if interested care to browse Confessions of a Policy Adviser - 3: Administrative Trainee 1 since this provides a snapshot of the Service at the time I joined.

Secondly, agency structures change regularly as do people. To be absolutely accurate I should trace all these changes, but this is a huge task. My feeling is that we can use current structures as a base unless there is a reason to look further. No doubt someone will point any errors out.

Thirdly, I should provide some constitutional information for the benefit especially of people outside Australia since this sets the context within which the discussion takes place. In this context:

  • Australia is a constitutional monarchy sharing a monarch with the UK, Canada and New Zealand as well as a number of other states. Our constitution provides for the appointment of a Governor General to represent the Queen in Australia. In the Queen's absence from Australia, the Governor General acts as head of state.
  • While there were some US influences on our founding fathers and especially on some of the wording used in the drafting of the constitution, Australia operates within the Westminster system. This is very important because it has profound if sometimes subtle and unseen influences that distinguish our system of Government at both state and federal level from those found in presidential systems such as the United States.
  • The defeat of the Royalists during the English Civil War established the primacy of Parliament within the Westminster system. This was carried through in the Australian constitution granting Parliament sole legislative power, although the Monarch or the Governor General on her behalf retains certain reserve powers. Because our system evolved over time, many key operational elements are not formally defined in a constitutional sense and are guided by tradition and culture.
  • The Prime Minister is appointed by and can be dismissed by the Governor General and holds office only so long as he/she can control a majority in the House of Representatives as the people's house. Ministers are appointed by the Governor General on the advice of the Prime Minister.
  • Each minister is given a portfolio, a bundle of areas of responsibilities formally defined in the administrative arrangements. Each portfolio contains one or more departments of state (these are called ministries in other countries such as the UK or New Zealand) along with a range of other agency types that have become more varied and complex in recent years as a consequence of the revolution in public administration. The arrangements also specify the legislation administered by each portfolio.
  • The administrative arrangements system allows Governments to continually revise responsibilities to meet changing needs, especially political needs, creating flexibility but also a degree of institutional variability almost incomprehensible to those outside the system including those in the private sector. This creates major problems for, and sometimes perverse results from, the application of planning and management techniques drawn from private sector models.
  • Finally, the rise of executive power and the evolution of more presidential style Prime Ministers has created sometimes unseen tensions inside the Australian Westminster system.

Public Administration and the AWB Affair - setting the scene

In my last post on the AWB Affair, I suggested that a major issue for me was the way the affair suggested the existence of systemic problems in our system of public administration and that I might write something on the history of the affair from that perspective.

In doing so, I would like to make the material accessible to people outside Australia as well as those in the country with limited knowledge of the way Government works.

In addition, those who read this blog regularly will know that I use my posts to develop ideas and to expose them to public test, then moving on. In writing, I draw from previous posts, pointing to interlinks between ideas, modifying ideas as necessary

So in forming my preliminary views on Cole, I was influenced by the previous posts I had written looking at changes in Australian public administration in a global context. I thought therefore that I should provide a brief overview of them.

This current public administration stream really began with my confessions of a policy adviser series in which I planned to use elements of my own career to point and counterpoint between broader change processes and my own experience. However, I put that aside for the moment because I needed to do some background work.

So far there have been four background posts:
Finally, a snippet of interest for all those with some interest in the Australian Government.

The Australian system is still remarkably transparent notwithstanding recent War on Terror related changes. Here most Australians do not know that the Australian Government maintains a good on-line directory on structure, organisations and key people at national government level.

AWB, Cole and the Failure in Australian Public Administration

Lexcen wrote:

The report on the AWB is out. In all the hoo ha that will erupt, I think what
will be missed is the fact that AWB was a government department to begin with.
Nobody doubts that the AWB bribed Saddam Hussein whilst Australia was war with Iraq. And my point is that nobody will question the governments' foresight to
privatize the AWB upon discovering the extent of the corruption involved.

Neil commented on the very careful way I qualified my English in my previous story on the Cole Royal Commission outcomes. I do write carefully because my purpose is to try to understand, to explain what might have happened, to look at the lessons. In doing so I am going to make mistakes in regard to fact and interpretation. I also try to remember that there are people on the other side of the desk.

I have now skimmed the Cole Report.

While I found the Report frustrating because Mr Cole did not directly address the questions I am interested in, the material makes me glad that I did exercise care, for my views have shifted. You can see this in the change of term in the header, from Public Service Failure to a Failure in Australian Public Administration.

I indicated in my first post on the issue that the thing that had puzzled and also concerned me most about the AWB scandal was the failure of the Public Service to identify the problem and then advise Government. I suggested various possible reasons for this, ending by suggesting that key issue to me was the extent to which the whole affair has revealed systemic weaknesses in our system of public administration and, if so, what we might do about it.

I found Cole both frustrating and fascinating. Frustrating in that his focus meant that he did not address the questions I am interested in except in a peripheral fashion. Fascinating because it reads like a plot for a novel, fascinating because of what it does tell us albeit indirectly about the nature of the systemic weaknesses in our system of public administration.

I quoted Lexcen at the top of the page. I think that what he says is actually a bit muddled, but he has captured an important point.

In July 1999, the Wheat Board moved from a Government owned statutory authority (it was never a Government Department) to a grower owned corporation, listing as a public company in 2001. This transition had been in planning for some time.

While the corporatisation/privatisation approach was part and parcel of the Government approach I have talked about before, the grant of a statutory monopoly, the single desk, to a private corporation was unusual.

If I understand the chronology correctly, the first demand from the Iraqi Government for kickbacks occurred in June 1999, the month before the final transition. So the development of the Wheat Board response to this began while the Board was still formally a Government owned body and was completed in the period immediately after privatisation.

In this sense the response would indeed appear in some ways the creature of the culture that had evolved in the Board especially in the period leading up to privatisation. However, this is not to my mind the real point except to the degree that it bears upon the way that corporatisation and privatisation affect organisational cultures. I do not think that the Wheat Board is Robinson Crusoe if we look at the behaviour patterns corporatised entities, although it may be a particularly bad example.

To my mind, the real point is what the chain of events from the decision to corporatise through to the present time tells us about the way our present system of public administration works.

I shudder a little at trying to write this because of the size of the task, but I might have a go at parts simply because it is such an interesting as well as important story. We will see.

Tuesday, November 28, 2006

Victorian Elections - a further postscript

I must say that I find the Victorian Legislative Council election processes complex because of the preference flows.

I also feel embarrassed at the fact that, based on the ABC site early Sunday, I congratulated Evan Thornley on his election when in fact it now appears far from certain. I am not personally an ALP supporter, but still hope that Evan will get in because he has a lot to contribute.

The Victorian Electoral Commission site has the latest figures. Those interested in the complexity of this and other elections might consult the Poll Bludger site.

AWB, Cole and Public Service Failure

"What you don't know you don't know", Mr Downer

"This matter might never have been discovered if it were not for the downfall of Saddam Hussein", Mr Howard

I suppose the thing that has puzzled and also concerned me most about the AWB scandal was the failure of the Public Service to identify the problem and then advise Government.

Statement of the Problem

Why is this important? Government depends upon its Public Service for sound advice in the first place and then for effective action in implementing Government decisions. Here the Public Service is not like business even though business models have been imported into the Service as part of the global revolution in public administration.

I can illustrate this very simply.

A standard management mantra in business is the need to make decisions quickly, recognising that some of them will be wrong. A good manager is one who gets the majority of decisions right or at least part right. The focus therefore is on the successes.

By contrast, in Government the focus is on the failures. Forget the 98 per cent of good or at least not bad decisions, it is the 2 per cent that go wrong that attract all the attention.

There are good reasons for this. When a company makes a bad decision people are affected, but the adverse effects are limited. When a Government makes a bad decision, the whole country can be affected.

Further, the decision frames are very different.

Even the most complex business problems are relatively simple and defined, although implementation may be difficult requiring great skill. By contrast, policy problems are often complex, ill-defined, full of shades of grey with uncertain outcomes. In business, the decision making processes and parameters are relatively simple, in Government complex in application because of (among other things) the need to balance so many differing interests.

An effective Public Service is critical in making this complex Government world work. Government may not heed Public Service advice because it has to take into account other factors, but it needs that advice as a starting point.

Why then, in the words of Mr Cole, do we have this situation? - "The critical fact that emerges is that DFAT did very little in relation to the allegations or other information it received that either specifically related to AWB, or related generally to Iraq's manipulation of the program."

In saying this I am focusing not on the detail of the case, but on the broader question of whether the Public Service reforms themselves over recent decades may in fact have created a systemic problem within the Public Service, one that poses a significant national threat.

When I was a senior public servant I used to see all the international cable traffic coming into the Department at all security classification levels from all posts and agencies. Each day I used to scan up to 200 cables looking for issues of relevance to my responsibilities. There was some absolutely fascinating material, and I must admit I sometimes got badly sidetracked. However, I was well informed.

In addition to the cable traffic, I was in constant contact with industry, industry associations, lobbyists, other agencies through phone, written material, at lunches and dinners, on site visits and at meetings and conferences. My staff also provided constant information and advice.

A key part of my role was to identify and manage potential issues within my responsibilities that might affect the Department, Minister or Government. Depending on the issue, I might follow up within the Department, with other Departments, with ministerial staffers (their focus was more political, mine policy, but the two always overlapped to some degree) or with the Minister. In the case of the Minister I might prepare a minute to him, arrange an appointment to see him or, if the matter was very important, simply pick up the telephone.

This background will explain why I find the failure of officials across a number of agencies to properly identify and act on the problem puzzling and concerning, why I fear that the case may be an example of systemic failure.

Now it may be that my concerns here are simply wrong, that there was in fact insufficient evidence to warrant more than a simple follow up with the company, that current knowledge is simply the benefit of hind sight.

Accepting that I have yet to read the report, I actually find this hard to accept because I ask myself what I would have done if I had some form of policy and program responsibility, if it had come across my past desk.

Starting from the premises that we were dealing with a corrupt regime, that it was likely that there was some form of rorting somewhere in the world, that this was a major Australian export industry, that if true it would be disastrous, I would have started by looking at the structure of the Oil for Food program so that I understood how it worked. I would have checked files and with colleagues to see if they knew anything.

If there was nothing around to show a problem, I would then have spoken to the company as happened. If I they assured me that there was no truth in the matter, I would have tried to test this with questions based on my knowledge of the scheme. If this was okay, then I would have accepted their word. However, as an older style public servant, I would have ensured that all this was carefully documented. I would also have informed the minister, even if only as a short reference in a broader information minute.

So at least I think that there was probably an initial policy process failure. I also think that when I go through the detail of the report I am likely to find compounding failures.

Accepting that I might change my view based on later evidence, it is important to understand how this failure might have happened. Here there are a number of possibilities.

Possible Reasons for the Failure

Part of the reason for the failure may simply lie in the nature of modern communications, including especially the importance of email traffic.

In the earlier period I talked about, all cable traffic was centralised and copied to key agencies. So a cable from the post in New York to DFAT reporting concerns would also have been automatically copied to a number of other agencies.

Now it may be, I do not know because I do not know how cable and email traffic is now managed, that the various warning signs were so fragmented that nobody could see the pattern. If so, this is an important issue that needs to be addressed.

A second more disturbing possibility is that we are dealing with failure across the linked dimensions of skills, structure and attitude. I have to be careful here because I am not as close to the Public Service in a day to day sense as I once was.

I have the strong impression that the Public Service has been dumbed down. I do not mean by this that our public servants are dumber than they were, they are not, simply that the type of reflective policy skills that I was taught are less valued. The focus today is on doing rather than on defining what to do.

This is reflected in the Service's structure and operating systems including the way performance is judged. Key features as I see them are:

  • The application of the private sector CEO, executive model means that the Service has become more centralised, more controlled. Unlike former permanent heads who were in position for a long time and saw their first role as advising the Government, agency heads now shift quickly and (as I see it) see their first role in terms of managing the agency. This is quite a profound shift. Among other things, it means less folk knowledge, reduced real authority for lower level officers.
  • Program structures appear to have become both less stable and more rigid. Less stable in that they change more often, more rigid in that it is harder to do things outside program structures. The second holds for both new things and things that don't fit exactly within programs. The type of more free ranging authority that I once possessed appears no longer possible. This is also reflected in one of the conclusions from Cole, that there were no places for Foreign Affairs officials to take their concerns.
  • Individual officers are busier and have less real support. Compared to my period, they spend more time on personal and program administration, more time on simple processing of work including document preparation/presentation. There is simply less time to think.

These things feed into the more complex question of attitude. While Cole's conclusion that there was no place for Foreign Affairs officers to to take their concerns reflects structural problems, it also suggests a major attitude problem.

I simply do not accept that that the absence of a place to go in structural terms should be the end of the story in either Foreign Affairs or in other agencies with an interest in the matter including Primary Industry. If it were true, then I would find this the most terrifying element of all because it implies that systemic problems associated with structural rigidities are such that important issues that do not fit into existing structures can simply drop into the cracks until they finally blow up.

My experience has been that people can work their way round systems where they consider the issue to be important enough. It may be that a key problem in the evolving scandal was that no one was prepared to take ownership of the issue, that it was seen as someone else's problem.


This post should not be seen as an attack on the public servants involved in the matter. I am not interested in the blame game, nor am I interested in short term responses.

We can already see that responses on both sides of politics are symptom based. Criminal action against AWB executives, tighter penalties for sanction busting, review of the single desk. These may be important but do nothing to address the question of why the problem arose in the first place and of the slow responses to it.

The key issue to me is the extent to which the whole affair has revealed systemic weaknesses in our system of public administration and, if so, what we do about it.

Monday, November 27, 2006

Australian Idol 2006

Photo: Australian Idol 06 Final Concert, Australian Opera House. Photo taken from Australian Idol web site.

I found last night's finale of Australian Idol quite inspiring. I had thought Idol was past its use by date. Indeed, as a family we really started watching seriously half way through.

Two things forced us to change our minds.

The first was the huge and varied talent on display, I think in combination the best of any Idol. The second was the decision by the producers to free up the program, to allow inclusion of participant's original material, to allow them to use instruments, to allow greater variety in material generally.

The production last night was quite simply superb, if perhaps a little long. The Opera House/harbour setting itself provides one of the world's most visually appealing back-drops. The singers including both previous Idol participants as well as the top 12 finalists this year (and of course Marcia Hines and her daughter) were very good, while the production design was excellent.

The show also illustrated many of the things that I have been talking about on this blog in my commentaries on Australia, its people and changing culture.

The two finalists were a complete contrast, in many ways showcasing Australia's complex and varied ethnic and cultural mix.

Damien Leith, the eventual winner, is a thirty year old Irishman living in Sydney with his wife and baby son. In Damien's case the cut-overs to supporters were to a rowdy Gaelic Club in Sydney where the Irish community had gathered and back to Ireland to his old school and Irish home. Damien himself is no musical novice, forming his first band at an early age. His seccond, family, band was succesful and attracted US interest, but Damien returned disillusioned from the US and then settled in Sydney.

Jessica Mauboy, the daughter of an Indonesian father and an Aboriginal mother, is a seventeen year old school girl from the Northern Territory. In her case, the cut-overs were to Darwin in the Northern Territory, to a huge and incredibly varied crowd including family, friends and teachers from her school (Sanderson High School) as well as supporters drawn from all parts of Darwin's varied community.

While only 17, Jessica too has been involved with music since an early age. Those who know my New England connections will understand why I was pleased to find a New England linkage.

At 14 Jessica's well-developed skills as a vocalist helped to secure first place in the Road to Tamworth competition, where Jess had the opportunity to meet local country legends: "Part of the prize was to go to the Tamworth Camerata Junior College, the music school. That was so fun. We got to meet Beccy Cole and Kasey Chambers. They just had a talk about how they developed through their music. I was really into that. It gave me confidence and made me love music more.”

The evolution of Tamworth as the national country music centre has played a significant role in developing Australian talent.

Tamworth Camerata (and here) is unique in Australia, and possibly the world, as the only recognised country music school for junior performers where they learn from the best in the business. It is widely acknowledged as a ‘feeder’ for the grown-up version - the CMAA Australian College of Country Music, as many Camerata graduates progress to college and further afield in the pursuit of their careers.

As an aside, Shannon Noll (and here), one of the outstanding commercial successes from earlier Idols, is a New Englander. As indeed in different contexts are Peter Cousins who received his initial training performing Gilbert & Sullivan at my old school (The Armidale School) and Peter Allen who also went to school in Armidale at the Armidale Demonstration (Peter was several years in front of me at Dem and I don't really remember him from this period) and then Armidale High Schools.

Enjoying the show last night, I could not help contrasting it all with the fifties when I was growing up and when I used to cringe at some of the performances I saw. It's in part due to an increased population, more to the fact that there is just so much more now to support and nurture talent.

Sunday, November 26, 2006

Victorian Election Results

Postscript one: In preparing this story I forgot to congratulate Evan Thornley on his election to the upper house as an ALP member for Southern Metropolitan. Evan gave this year's Drummond Oration at Armidale and also recruited my wife into the Fabian Society.

Postscript two 27 November: I see from later information that the final Council results will be a a little different from those I presented here. I will include full results once they have been finalised.

With 75 per cent of the votes counted, the ALP has held Government comfortably, with the ABC predicting (seven seats are still in doubt) that the ALP will win 56 (down 3) of the 88 Legislative Assembly seats as compared to 23 Liberals (plus 3), 8 Nationals (plus 1) and 1 (down 1) independent.

Labor has, however, lost control of the Legislative Council under the new proportional voting system in use for the first time. If my maths are correct here, the new Council will have 17 ALP, 14 Liberal with 3 each for the Nationals and the Greens.

Looking at the individual party votes:

  • The ALP ran in all 88 seats gaining 43.7 per cent of the Assembly primary vote, down 4.3 per cent. Labor will be happy with this result.
  • The Liberals also ran in all 88 seats, gaining 34 per cent of the vote, an increase of just 0.1 per cent. The Liberals are not happy with this outcome.
  • A key reason for the small swing to the Liberals is the presence this time of the Family First party (a Christian, family values party), which also ran in all 88 seats gaining 4.3 per cent of the vote. Family First will not be happy at its failure to gain representation in the upper house.
  • The Greens ran in all 88 seats, gaining 9.6 per cent of the primary vote, down 0.1 per cent. This was not a good result for the Greens. The Green vote appears to have been largely concentrated in Melbourne, giving them a member in three of the five metropolitan upper house provinces. While they will be pleased with this outcome, they will also be disappointed at their failure to win any lower house seats and especially the seat of Melbourne where they were given a strong chance prior to the election.
  • The National ran in 20 regional seats, giving them 5.4 per cent of the total primary vote, an increase of 1 per cent. I suspect the main National Party reaction to the result will be one of relief. Facing a challenge this time from the Liberal Party in every National held seat, the Nationals managed to hold all their seats while also winning an additional one back from an independent.

Friday, November 24, 2006

Victorian Elections

A short note for the benefit of my international readers with an interest in Australian politics.

The Victorian State elections will take place tomorrow, 24 November with electors casting votes for both the lower house or Legislative Assembly (districts) and the upper house or Legislative Council (provinces).

Under Australia's Westminster system, the party or coalition of parties obtaining a majority of seats in the lower house forms the Government. At the last state elections, the Australian Labor Party won in a landslide ending with 62 of the 88 Assembly seats as compared to 17 for the Liberal Party, 7 for the National Party with 2 independents.

Voting is compulsory in Australia, so well over 90 per cent of the electorate will vote. Compulsory voting reflects the mix between the individualist and collectivist in the Australian character that sometimes confuses outside observers. Because we are a democracy, every citizen must vote!

Preferential voting is used in the lower house to elect candidates to single member seats. This makes second or even third preferences important. The phrase "two party preferred vote" is used to describe the final outcome after distribution of preferences. The practical effect of preferential voting is to ensure that the electorate takes into account not just their favourite but also those they oppose least among the rest.

Since the last election new constitutional arrangements have been introduced for the Legislative Council. This includes multi-member regional seats elected by proportional representation on a system like the Australian Senate. This advantages parties such as the Greens who get a reasonable vote across the state if below the level required to win an Assembly seat in their own right. It disadvantages parties such as the Nationals whose vote is highly concentrated in particular geographic areas.

The public opinion polls suggest the the Labor Government will be returned, although the Liberal Party appears to have clawed back some ground. The key things to watch in the election are:
  1. The extent to which the Liberals can recover seats.
  2. The performance of the Greens in the Assembly (they have been preferenced by the Liberal Party in some seats) giving them a chance in a small number of otherwise Labor Party seats and in the Council. In my view, this is a make or break election for the Greens
  3. The performance of the Nationals. There is no coalition agreement in Victoria, and the Liberal Party is running against them in every seat.

Australia is fortunate in having good on-line election coverage. The ABC site is especially good here. The pre-election analysis by Antony Green is especially good for the outsider.

Thursday, November 23, 2006

GDP - Australia in its Region

Photo: Clare Belshaw and friends, Clare's birthday, four friends, six ethnic ancestries, one country.

Thinking about issues raised in my last post on the Australian Way and Mr Akya's suggestion that we should all pack up and return to Europe, made me curious as to where Australia now stands in the Regional Gross Domestic Product (GDP) rankings. GDP is a very rough measure, but it does provide an indicator of economic power.

Just to set a context here, back in the early eighties Australia was seen in some ways as the sick man of Asia.

Our economic growth had been very slow and was widely seen as likely to stay that way, creating a growing performance gap between Australia and the faster growing Asian economies, young tigers and others. This affected us in all sorts of ways.

I remember being on an official visit to Indonesia as part of a team led by Barry Jones where some Indonesian officials in private conversation expressed the view that Australia's real economic and industrial power was in structural decline. Around the same time, I was involved in discussions trying to attract new investment to Australia from US firms who expressed similar views. I did not share those views, but it was very hard to get the message across.

So where do we stand now? First some numbers, and then a comment.

The Numbers

A list drawn from Wikipedia of Asia-Pacific countries follows ranked by 2005 nominal GDP in millions of US dollars follows. I have added in the world and EU for comparative purposes. I did not find figures for Cambodia.

  • World 44,454,843

  • EU 13,502,800

  • US 12,455,825

  • Japan 4,567,441

  • People's Republic of China 2,234,133

  • Canada 1,132,436

  • South Korea 787,567

  • India 771,951

  • Australia 708,519

  • Taiwan 346,178

  • Indonesia 281,264

  • Hong Kong PRC 177,703

  • Thailand 173,130

  • Malaysia 130,835

  • Singapore 116,775

  • Pakistan 110,970

  • New Zealand 108,520

  • Philippines 98,371

  • Bangladesh 60,806

  • Vietnam 51,388

  • Shri Lanka 23,534

  • Myanmar 12,151

  • Brunei 9,531

  • Nepal 7,515

  • Papua New Guinea 3,931

  • Laos 2,875

  • Fiji 2,861

  • Bhutan 864

  • Samoa 336

  • Vanuatu 336

  • East Timor 331

  • Solomon Islands 294

  • Tonga 215

  • Kirabati 63


This is not an economics essay, so I will not comment on any problems with the numbers. I am only concerned with what they tell us about rough patterns. Those patterns explain much about the drivers of Australian economic and foreign policy. They also explain why we need to develop our own Australian way.

To begin with, Australia's position has slipped, from fifth to seventh since the eighties. If we combine Australia and New Zealand, the two economies have been interdependent for many years, we remain in fifth position, although continued growth in India will soon (if it has not already done so) drop the combined total back to sixth. Perhaps the most remarkable thing in the overall rankings has been the huge increase in Korean GDP.

Putting Australia's position in another way, in world terms we have dropped from 2 per cent to 1.6 per cent of global GDP because of faster growth elsewhere. The US has experienced a similar relative decline, from over third of global GDP down to 28 per cent. Both countries are likely to continue to slip.

Accepting that there has been some relative decline, the huge GDP gap between Australia or Australia and New Zealand combined and the next group of countries shows why Australia is and will remain a major Asian economic power for the immediate future. But the numbers show a lot more than this.

Dealing with major economic variables first:

  • They show in economic terms the changing relative Asian power equation between the US (huge but declining), Japan (very big but declining), China (big and growing) and India (a fair bit behind but growing). Managing this complex power equation is one Australia's foreign policy drivers.

  • They also show why Australia has such a strong interest in seeing economic growth elsewhere in Asia. ASEAN (the Association of South East Asian Countries), a grouping of Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines), Singapore, Thailand and Vietnam, is important here. At present, ASEAN has a population of 555 million with a nominal GDP of $US681 billion. The ASEAN countries are Australia's close neighbours, the combined ASEAN/ANZ nominal GDP totals $US1,500 billion, so while rapid growth in ASEAN would weaken Australia's relative position it would also create a new southern economic power base.

  • These economic variables have led the Australian Government to adopt a complicated and multifaceted trade policy whose complexity is, I think, little understood inside or outside the country.

The core elements in that trade policy are:

  1. Support for the World Trade Organisation because freer global trade is important to smaller countries. Within the WTO, Australia's role in the Cairns Group reflects the importance of primary products to the country.

  2. Because the global moves towards freer trade have largely stalled, Australia has moved to negotiate a number of free trade agreeements building on the earlier success of Closer Economic Relations with New Zealand. The 1966 precursor of CER, the New Zealand Australian Free Trade Agreement, was one of the world's first such agreements.

  3. The pattern of current and proposed agreements reflects the macro economic patterns described above. If we take the the three biggest Asia Pacific economies, we have a free trade agreement in place with the US, are presently negotiating one with China and are in early stage discussions with Japan. If you look at ASEAN, we already have free trade agreements with Thailand and Singapore, we are in discussions with Malaysia, while negotiations are also underway for an ASEAN-New Zealand- Australia agreement.

  4. Beyond these immediate agreements, Australia is involved with preliminary discussions on a free trade agreement with the Gulf Cooperation Council bringing in our middle east markets, continues to play a major role in APEC, and on the Indian Ocean side is a member of The Indian Ocean Rim Association for Regional Cooperation. I would be very surprised if this did not lead to discussions with India, perhaps more broadly in due course, thus completing the macro pattern.

  5. In parallel, Australia has been encouraging overseas investment to build further lock-ins. Just as US and British investment was important in the fifties, then Japanese investment in the sixties, now Chinese investment (as an example) is starting to play an important role.

These various moves are designed to protect and balance Australia's longer term position as a significant but smaller player in an increasingly complex world. However, in combination with more macro developments they are changing Australia in ways (big and small) that are likely to be as dramatic and as fundamental as the changes from 1945 to 1970 or those from 1970 to the end of the century.

This may sound dramatic. If so, consider the following few examples:

  1. Australia is a super power in its immediate region, and sometimes behaves with the arrogance of one. Ten years ago few of us would have foreseen the increasing need to project force in the way we have had to in the Pacific, that the Australian Federal Police as an example would have to create an entire international arm. Our relations with our Pacific neighbours are likely to become more, not less, complicated. Questions of economic integration, of migration, are going to be very important. I can easily see circumstances where we might end up with an additional 500,000 plus short and long term Pacific Islanders residents over the next ten to fifteen years, perhaps making them the second largest ethnic group in the country.

  2. Countries in which Chinese form the major ethnic group now have a combined GDP of almost 2,900,000 million US dollars and growing fast. Add in resident Chinese populations in some other countries and you can see why, at least according to the Prime Minister (I had not known this and have not checked), the various variants of Chinese have now become Australia's second most common language. The number and I think the proportion of Chinese Australians can only continue to grow.

  3. I have no doubt that there will be a Free Trade Agreement with ASEAN. I also have no doubt that this will lead over the next twenty years to increasing economic integration between ASEAN and ANZ. If, as we all hope (the alternative is possible but too awful to contemplate), Indonesia maintains its development, the integration between Indonesia and Australia is going to become a special issue in its own right. Quadruple Indonesia's GDP, tighten the linkages between the two countries, and Australians of all types will be beating on Indonesia's door wishing to participate, while Indonesian involvement (people as well as investment) in Australia and the Australian economy will expand in just the way we have already seen on a smaller scale with Singapore.

  4. Unlike most other parts of the world, Australia has no choice but too (and will) accommodate those of the Muslim faith for both economic and political reasons. Forget immediate issues in the Middle East or the War on Terror, the immediate Australian world includes the majority of the world's Muslim population. It also includes the majority of Hindus, of Buddhists, of several other faiths. We have to find a way of melding these different faiths (and people) together in a community if we are to survive, let alone achieve our potential.

This last point links to my theme about the Australian Way.

Australia is already one of the world's most diverse countries in ethnic and cultural terms. This is where Mr Akya is, to use an Australian phrase, talking through his hat. We have already accommodated some of the most dramatic ethnic and changes experienced by any country in the last 100 years. We have done so because, and this is part of the Australian way, we are prepared to accept others as people first.

Just as we have done in the past, so will we continue to do so in the future as we move into the new world facing this country.

Wednesday, November 22, 2006

The Australian Way - Introduction

I had not intended to post today. However, in my trawling I came across material that created an itch to say something.

On September 2006 in Blogosphere Woes I reported on a journey across the blogosphere, that, with one exception, left me wishing that I had never started, blogged out. I concluded:

The exception? Australia really is culturally different from most other countries, quite remarkably different. We don't see it unless forced to by the type of journey I have just taken. I will try to capture this in a post once I have recovered.

In the way of things, this then started me on a series of posts exploring different aspects of the Australian experience.

This morning a visit to Tim Blair's blog led me to an article by Chan Akya in Asia Times Online commenting on Australia. Some of the comments on Tim's blog as well as as in other discussion chains positively sizzled with outrage.

I thought that the article was a bit silly, although perhaps no sillier than some of the op ed pieces we see in Australia's own newspapers. However, it caused me to look back at the pieces that I have written trying to articulate what I now think of as the Australian Way, the things that in combination make us truly different as a country.

One difficulty with the blog format is that it makes it very difficult for readers to follow discussion threads spread over multiple posts. Looking at the range of material I have written, probably over 30,000 words now, the slowly developing messages get lost. I can see the pattern and supporting linkages, but no reader will.

So in the midst of the other things I am interested in, it may be time to start drawing some of this together, to represent it so that it can be further criticised and refined.

Tuesday, November 21, 2006

Pause for Reflection

Thank you Neil for your positive comment on my latest post on the NSW Government's Ten Year Plan. I am now going to take a break until next week, although I reserve the right to change my mind.

Writing the type of posts I do takes time, sometimes a lot of time. The analysis of the NSW Plan has taken days of time across two blogs. The reason I do this is that I want my readers to understand where I am coming from, to then then put my views in a context.

In writing I am conscious that the majority of my readers are not from Australia. So if I am going to write on NSW or Australian issues, I have to put them in a context that a broader readership will understand. The best way of doing this is to link them to broader trends. Again, time is involved.

To my readers who are Australian Labor Party supporters, I have no idea of the numbers here, do not worry that I will not expose the non-Labor parties to the same scrutiny. In this context, next week I propose to take Peter Debnam's releases (he is the leader of the NSW opposition) and subject them to the same analysis.

I am only guessing at this point, but I expect to find the following:
  1. Most will be simply attacks on the Government
  2. The ideological base as it applies to the role of government will be identical to that of the Government
  3. There will be very few substantive releases warranting detailed analysis.

I may be wrong. I will be interested in the outcomes.

Sunday, November 19, 2006

NSW Ten Year Plan - praiseworthy but flawed

I see the NSW Government has been advertising their new Plan on TV.

This post will complete my immediate comments on the Plan. My focus is on what the Plan tells us about the Government's approach to public policy and administration, linking this to some of the things that I have been talking about in previous posts, rather than the detail of the plan itself.

Because I am going to be quite critical, I should mention the positive up front. Whatever the weaknesses of the Plan, and they are many, the Plan provides a structure for evaluating just what the Government has done and proposes to do. It is unusual for any Government to do this, so it deserves praise.

Is it a Plan?

To my mind, the Plan is not a Plan at all. Looking at planning from a management consulting perspective, any plan starts by setting out high level longer term objectives, it looks at the opportunities and challenges facing the organisation if those objectives are to be achieved, then with this as base it sets out what is to be done.

As outlined by Peter Drucker a long time ago, planning is all about the futurity of current decisions. By definition, a plan is about the future. However, the future is set by what we do now. So planning allows us to take the future into account in current decisions.

There is no overarching vision for NSW in this Plan. Perhaps there cannot be.

In my post on the New Zealand model, I talked about the difficulty Government and minsters faced in setting overarching objectives. I also spoke of the difficulties the Government faced in developing new policy approaches when its ideological stance was opposed to certain classes of action. Both problems hold in NSW.

NSW is a large and varied area lacking geographic unity. The commonalities that combine people in NSW are largely national, national economy, national culture. As we drill down from state level, the commonalities vanish.

NSW is very varied. This could be managed by explicitly recognising those variations, by creating a plan based around variation. But the NSW Government cannot do this, it feels that it must set state wide targets.

To the degree that the Plan does recognise diversity, it breaks up into analysis and targets that take Sydney on one side, the rest of the state on the other. While there is considerable diversity within Sydney, it is a unit. "Regional and Rural NSW" is not.

We can see this if you look at my posts on the Plan and New England. In the first post, I attempted to analyse New England's needs to set a base for consideration of the Plan. In the second post, I looked at the detail of the Plan in terms of those needs. My third post summarised my conclusions. My bottom line was that the gap between the Plan and New England's needs was huge.

The Plan's Ideological Stance

The Plan may not be a Plan, but it does bear a strong resemblance to what are called service level agreements.

The concept of a service level agreement comes from business and is applied to commercial arrangements between a purchaser and supplier. These agreements specify what will be supplied and focus on agreed performance standards. This is exactly what the NSW Government has tried to do. In doing so, it has followed the NSW tradition dating back to the Greiner Government and its introduction of elements of the New Zealand model.

On the surface, this seems reasonable. The core role of the State Government is the supply of services to the NSW community, so it's only right that it should specify what is being provided, how performance is to be measured. But here we in fact strike several problems.

The standard service level agreement is a means to an end, the supply of services to be used for a purpose. The performance standards are determined by the purpose to be served.

The problem with the application of this model to NSW is that Government involves two overlapping but distinct groups with different performance interests:
  • there are the clients/customers of the service who benefit from or are affected by the service. They are interested in the impact of the service on them.
  • then there are voters who are in fact the ultimate customer for the services provided.
Performance standards at the client/customer level are relatively easy to set. It is much harder to set performance standards at the voter level.

In the past, Governments attempted to handle this by articulating broad values and policy stances that integrated policy and at least provided a broad framework within which voters could then make judgements depending upon both Government performance and their specific interests.

The problem with the managerialist approach built into the Plan with its emphasis on the citizen as customer and on specific activities or programs and associated targets is that it destroys the broader framework. This actually forces voters to try to make complex judgements by amalgamating their individual responses on a variety of individual programs of varying interest to them into an overall judgement on Government performance. I suppose that we can summarise this by saying that politics has become the sum of the parts rather than a judgement on the whole.

This approach also damages Government itself by forcing it into a reactive mode. In the absence of some over-arching vision, however imperfect, Government end up setting policy by responding in an ad-hoc fashion to constantly shifting customer needs defined by increasingly sophisticated consumer measurement techniques.

Just to illustrate the impact. Is law and order and security, as implied by the Plan since this is the first priority area, the single most important issue facing NSW? I may be wrong, but I very much doubt it.

Education as a Case Study

Just to flesh this out a little further, let's take education and training as a case study.

I would have thought that the critical issues here included:
  1. The overall Government stance to the role of and importance of both education and training
  2. Education and training needs across a large and diverse state
  3. The existing system and the way it is meeting/not meeting those needs
  4. Proposed policy and program approaches to meeting those needs

If we look at the plan, these issues are not addressed. The Plan is defined in terms of a small number of measurable state wide target outcomes largely defined in isolation.

Friday, November 17, 2006

Changes in Public Administration - the New Zealand Model

This post continues my discussion on changes in public administration that I began to provide background and reference material for the Confessions of a Policy Adviser series.

In doing so, I had been going to talk about the NSW Government's Ten Year Plan as an example of current approaches to public administration. However, because the Plan is a NSW variant of what I call the New Zealand model, it seems sensible to talk about this first. In addition, the death of Milton Friedman (here, here, here, life also here, here), a key intellectual figure in the change process, makes it seem somehow appropriate.

I am sorry the post is so long. There just seemed to be a lot to say.

In my first main post, Changes in Public Administration - Notes, I began by looking at the rise of the welfare state at the end of the Second World War, then looked at the economic impact of the oil shocks during the seventies. This created global stagflation among developed countries (recession combined with inflation) that Governments struggled to deal with using previously successful policy instruments. Part of Friedman's influence lay in the fact that he pointed to some of the reasons for failure. The fact of global stagflation, the end of over twenty years of sustained growth, is a core reason why the seventies were such a tip decade in the change process.

I then went on to briefly discuss the development of the quality movement, standards based approaches and the associated rise in interest in measurement. In the following post, Publish or Perish - where did the this phrase come from?, I looked at the development of citation indexes as an example of the growing interest in, even obsession with, measurement.

The Rise of Thatcherism

The failure of previous policy approaches to address the problems of stagflation, continuing high interest rates and persistently high unemployment led to a search for new policy approaches.
In the Australian Treasury, for example, the persistent cry during the second half of the seventies was the need to "get the economic fundamentals right." Without this, we could do nothing else.

The revolution that was beginning to sweep away the old system of public administration including the welfare state is sometimes called Thatcherism.

Margaret Thatcher (and here) became Prime Minister of Great Britain in 1979, the first of a series of "conservative" (I have put conservative in inverted commas because the outcomes were far from conservative) world leaders including Ronald Reagan (1980) and Brian Mulroney in Canada (1984). Influenced by the ideas of Milton Friedman and a strong believer in free market forces, she began a process of winding back government involvement in the economy, of corporatisation and sale of Government business activities, of tight monetary and fiscal policy intended to destroy inflation.

The New Zealand Model: Introduction

While the overall change process is sometimes called Thatcherism, the purest expression of the overall approach - often called Rogernomics after the New Zealand Labour Party Finance Minister Roger Douglas -was to come in New Zealand. For a period, New Zealand was to become a major influence in global public administration, with New Zealand consultants fanning out to spead tha approach around the world.

New Zealand was an economic basket case when Labour came to power. Using ideas developed in the New Zealand Treasury Department, Douglas set out about a series of dramatic reforms. My concern here is not with the details of the reforms, but with the underlying model.

The Wikipedia article cited above suggests that a" major criticism of Rogernomics is that the reforms were undertaken without a detailed philosophical basis so it could be argued that the reforms were not fully completed."

It is true that the reforms were not fully completed, but I disagree that they lacked a detailed philosophical basis.

In my view, the New Zealand model was by far the most clearly articulated reform model in the world. Further, while it did incorporate elements of what came to be known as neoconservative views, the model itself could be applied within a variety of idea sets.

Structure of the New Zealand Model

The most interesting thing about the New Zealand model was the way in which it drew together so many of the new elements in global thinking.

To start with things that applied across the whole structure:
  1. Accountability. Accountability was central. Government and ministers were responsible for overall policies and programs and were accountable to Parliament. CEOs of ministries and agencies were responsible to their minister. And so on.
  2. Objectives. There should be clear and as much as possible measurable objectives. This applied to Government and ministers as well as those working for Government. If Government and ministers did not have clearly defined objectives, then how could agencies and CEOs have clearly defined objectives?
  3. Inputs, outputs and outcomes. A clear distinction needed to be made between inputs, outputs and outcomes. Inputs were the resources required to deliver individual activities, outputs represented the immediate deliverables from those activities, outcomes the results from outputs. Government was concerned with outcomes. So a clear relationship needed to be established between inputs, outputs and outcomes.
  4. Program approach. Because most outcomes (reduced crime, for example) required outputs from a variety of areas, there needed to be a program approach that integrated policies and programs across agencies. This was also required to accommodate the fact that while Government was responsible for outcomes, most minsters and agencies were really responsible for outputs that in combination determined outcomes.
  5. Standards Based. Consistent with the emphasis on measurable objectives and outcomes, standards based approaches were central across all of Government and beyond. Where appropriate, Government mandated standards. However, the process to be followed in achieving those standards was a matter for those responsible for delivery.
  6. Clear definition of roles. Government wore different hats that needed to be clearly defined. Government provided services to people that linked in turn to different needs and outcomes. In providing those services, Government purchased outputs from both public agencies and the private sector. Where Government acquired services from its own agencies, it was both an owner and a purchaser. As an owner it needed to get a return on the capital invested. As a purchaser, it wanted the best value for its money.
  7. Service purchase contracts. Where the agency was providing services to Government, the Government entered into an agreement with that agency to purchase an agreed package of services for an agreed period. In short hand terms, this came to be known as the purchaser/provider model.
  8. Agency independence. Consistent with standards based approaches, agencies had operational freedom to achieve their objectives, subject to achievement of financial performance targets (the ownership role) and any service delivery requirements as laid down in their service delivery contracts (Government as purchaser role). Previous central requirements such personnel administration or procurement were abolished. Agencies had control of their own funds including retention of interest on cash and of profits subject to any agreed dividend requirements.
  9. Accrual accounting. Government agencies at all levels needed to report to Government on their operations in terms of Government's role as owner (profit & loss statement, balance sheet, cash flows) and as service provider (cost, value for money). To assist this, accrual accounting was made mandatory. In turn, this allowed for the creation of a total Government balance sheet listing all assets and liabilities.
  10. Market focused. A key part of the model was the attempt to use market disciplines to encourage efficiency.

In applying the model all Government ministries and agencies were broken into three groups depending on their customers and market positions.

  1. Contestable markets: Agencies supplying good or services to external markets for a market determined price were turned into state owned enterprises and ultimately sold.
  2. External service provision, no market: Agencies supplying services, regulation of aviation for example, remained in Government ownership but became stand-alone entities and charged for their service so as to recover costs plus a return on capital. This was meant to be fully transparent to those being charged. In practice some element of subsidisation might still be required because of externalities. In this event, the subsidy in fact represented a Government purchase from the agency.
  3. Government as customer. Where the Government was the sole purchaser, then the ministry or agency became a service provider with a single customer. In theory, this separation allowed Government to consider alternative purchases, introducing a degree of potential competition. For example, New Zealand might choose to outsource defence in whole or part to Australia, paying Australia for the service. Or buy economic advice from sources other than the New Zealand Treasury.

I said that the model could be applied in a variety of systems. The starting point here is Government values and objectives. This then determines the cascade effect through the whole Government system.

As a simple example, you might choose not to sell state owned enterprises because you classified them as strategically or socially significant. In that event, you might need to pay the enterprise an extra amount as a subsidy. This would be identified and treated as a purchase of a service linked to the strategic or social objective.

Application of the Model in Practice - Introduction

I know New Zealand very well and love the place. Dad was born in there, I still have family there, and have visited it many times over the year. Given this background as well as my professional interests, I was absolutely fascinated with the reform process.

Roger Douglas knew that fundamental change - and it was fundamental - required fast and sustained action to drive things through. I was aware of the process while I was still working for the Commonwealth Public Service, but it was not until I set up my own consulting operation that I became directly involved.

In 1989 we decided to start selling services into New Zealand. This led me to make a number of marketing trips to New Zealand over 1989 and 1990.

Given that Government relations, Government policy advice and program evaluation were core business, from my first marketing trip I started to work my way through New Zealand ministries and agencies attempting to understand the New Zealand scene. In turn, this led us to set up what we called the Public Sector Reform Project to look at the revolution in public administration in New Zealand and then compare it to Australia at national level and in selected states. We also wanted to look at it at a Government wide level and then at its application in specific portfolios.

Application of the Model in Practice - New Zealand Scene

By the time of my first marketing visit in 1989, the revolution was four years old. There was an air of pervasive gloom in the general community.

Taxi drivers lectured me on the evils of a deregulated taxi industry, on the way in which competition had driven down both their income and the standard of service. Yet after visiting a number of agencies I was impressed by the coherence of vision and language. I started to become very positive about New Zealand's future, although I could also see some of problems starting to emerge in terms of the application of the model. These became clearer on subsequent trips.

I saw problems at two levels.

At national level, the Government and ministers were struggling to articulate the objectives, program structures and associated performance standards required to make the system work. There was a major clash between the day to day pressures associated with the Parliamentary system and the need to articulate longer term objectives.

There was also a major clash between the fundamental stance of the Government - deregulation and let the market flower - and the alternative more proactive stance.

This clash was encapsulated in the 1991 Porter Project report. Inspired by the ideas of and part authored by Michael Porter, the book was an incisive analysis on the causes of New Zealand's economic problems. However, its suggestions as to solutions were noticeably weak. It is very hard to define a pro-active development role for Government when your starting premise has ruled such a role out!

At agency level, agencies were struggling to introduce the new approach. This was partly due to technical problems, partly to interest conflicts.

The New Zealand Ministry of Defence and the New Zealand Defence Forces can be taken as an example of technical problems. They had to attach a value for balance sheet purposes to New Zealand's various military assets and then work out a depreciation schedule. One effect was to push the accounts into deficit because the New Zealand Government was not prepared to contribute enough money to defence.

The New Zealand Qualifications Authority can be taken as an example of interest conflicts.

The Authority defined a national competence based qualifications structure from primary through to the highest formal qualification. Consistent with standards based approaches, it should not matter how you acquired the necessary knowledge and skills. The only requirements were definition of the standard on one side, the test procedure on the other.

This posed a fundamental challenge to New Zealand's Higher Education system in that it meant that people could acquire a higher qualification independent of them or any other university. So the universities opposed this element of the changes.

Application of the Model in Practice - transmission to Australia

There are close links between Australia and New Zealand, and the New Zealand experiment had a significant Australian impact, although the transmission mechanisms were not always clear because so much contact was informal. In addition, because New Zealand itself was part of a broader global movement, it can be hard to distinguish between New Zealand and broader global impacts.

The NSW Greiner Government (elected 1988) is perhaps the clearest example of Australian impact. The Griener Government introduced many of the New Zealand approaches holus bolus. As a simple mechanical example, ministers were meant to agree their performance objectives with the Premier. Then the various departmental CEO's had to agree their performance objectives with the Premier's Department.

Again, as in the New Zealand case, we can see the way the application of the model was driven by the Government's ideological stance.

The Greiner Government saw itself as a market driven reform Government sweeping away the detritus of the past along the lines already pioneered in the UK and New Zealand. Mr Greiner himself defined the role of the Government in terms of economic and management efficiency. The role of Government was good management in financial terms and in the delivery of services.

That's fine, but it in fact left the Government in the same position as the New Zealand Government when it came to defining peak objectives.

On one side you had major changes intended to improve delivery efficiency as well as state economic performance, on the other a Government unable to articulate broader objectives beyond reform itself because the Government's role had been defined in such a way as to limit the scope of what could be done.

The Greiner Government fell in 1991. But the subsequent NSW Labor Party Governments in fact continued its basic thrust. As we shall see in the next post, this comes through clearly in the structure and content of the NSW Ten Year Plan itself.

Thursday, November 16, 2006

NSW politics has become unspeakable

In several earlier posts I have suggested that we needed to cut our politicians some slack. Recent events in NSW have made me doubt my own comments. For the latest development see Neil's story.

This is the last comment I will make on NSW political sleaze. It began with Labor. Then the Liberals joined in. Now of the major parties only the Nationals appear outside the sleaze loop.

Peter Debnam should resign. Alternatively, he should provide solid evidence. I see no choice beyond this. All he had to do was shut up and let Labour sink itself. Instead, he joined in with what, on the surface, appears an unsubstantiated allegation.

I am both bored and disgusted.

Australian Constitution & the High Court Decision on Work Choices

I have not had time to properly read the High Court's decision upholding the constitutional validity of the Commonwealth Government's industrial relations legislation. For the benefit of international readers, the legislation established a national industrial systems overriding State laws in significant areas.

While I have yet to read the judgement, I thought that I might make a very brief comment with links to source material.

The Australian Constitution was created by a 1900 Act of the British Parliament bringing together the previously separate Australian colonies into "one indissoluble Federal Commonwealth."

The passage of the Act was preceded by a long series of discussions, congresses together with referendums in individual colonies. All these colonies had been self-governing for a considerable period with full power in their own territories. A key issue therefore was what powers should be granted to the new Commonwealth and in what form.

The approach adopted was to cede (section 51) to the new Commonwealth Parliament power to make laws in specific areas, with all other powers remaining with the states. A High Court was established as a peak court to make judgements on matters relating to the constitution and federal law.

The initial effect of the constitution was to limit Commonwealth power leaving real power on most matters in the hands of the states. Further, while the constitution provided a mechanism for change through national referendum, the requirement for passage by a majority of the voters in a majority of the states meant in practice that very few constitutional change referendums have ever been passed.

Yet despite the limited initial allocation of powers and the voters unwillingness to formally change the constitution, the last seventy years has seen a remarkable expansion of Commonwealth power relative to the states.

Part of this expansion has come simply from the Commonwealth's greater financial power allowing it to make tied financial grants to the states imposing conditions as part of the grants. A greater part has come from the High Court's willingness over time to interpret constitutional provisions in a progressively wider way. Together, this has allowed Commonwealth powers to expand in a way that could hardly have been foreseen by the founding fathers.

The constitution does provide (Section 51 (xxxv.) that the Commonwealth Parliament shall have power for "Conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State". However, this power was too limited to provide a base for the new industrial relations legislation that the Howard Government wanted to introduce. Instead, the Commonwealth chose to rely on the corporations power.

Section 51(xx) of the constitution provided the Commonwealth Parliament with the power to make laws for " Foreign corporations, and trading or financial corporations formed within the limits of the Commonwealth."

Initially the effect of this clause was limited in two ways. First, at the time of Federation corporations were simply less important in economic terms. Secondly, the High Court itself initially adopted a cautious approach in interpreting the constitution so that Governments and policy advisers read this clause in narrow terms.

The decision by the Commonwealth Government to base its new industrial law especially on the corporations power represented a dramatic widening of the scope of that power leading to an appeal to the High Court to have the new law ruled unconstitutional. The majority decision by the Court to uphold the constitutional validity of the legislation, while not unexpected, has raised major issues in Australia about the Federal structure and the remaining powers of the states.

The Prime Minister's view is that these concerns are unfounded. The states should have no fears. The Commonwealth has no desire to take over state powers. It would only do so if it were in "the national interest" or to achieve a "public good".

Those on the other side of the fence point to the way that the Commonwealth has already intervened in a very wide variety of matters when expedient to do so from a public policy or political viewpoint. They suggest that now the power has been confirmed, the Commonwealth will do as it has done before, cherry pick issues of immediate concern, potentially creating an uncertain and chaotic situation.

From experience, I have absolutely no doubt that Commonwealth Governments of all political persuasions will attempt to use the now established power. It would be silly to think otherwise. The very words the Prime Minister uses - in the national interest, in the public good - indicate this since these matters are very much in the eye of the beholder.

The critical issue will become, I think, the way in which the Court subsequently interprets the words "trading and financial corporations." Some have suggested that this might apply in areas such as higher education now that all universities are engaged in one way or another in trade. I suspect that the Court would rule more narrowly than this.

A second important issue will be the nature of the coverage achieved. Even in the case of the new industrial relations legislation some 15 per cent of the workforce falls outside the scope of the legislation, remaining in the residual state IR system because people are employed by State Government departments and unicorporated businesses including partnerships.

I can see some interesting times ahead.

Wednesday, November 15, 2006


Last night I watched the ABC tribute to Australian playwright Alex Buzo. I have written on Alex before as has Neil. As Neil said in his latest post on Alex, it was stories on Alex on our respective blogs that first established a connection between us, one that I have greatly valued.

I thought that it was an extremely good tribute, drawing out some of Alex's complexity as well as his masterly command of the English language and especially the Australian idiom. The program also drew out another aspect of the Australian change process that I have been trying to address.

The sixties saw a flowering of Australian plays that peaked in the seventies before dying away. Often iconoclastic, these writers saw themselves as distinctly Australian, presenting Australia to Australia. A measure of their success was the way in which Australian theatre moved for a brief period from a fairly narrow cultural ghetto into broader popular consciousness. We can see something of the same process of rise and fall in other cultural areas such as film and poetry.

The number of Australian writers, actors, directors, poets, artists has increased enormously since the seventies. Many have achieved international success. Governments at all levels are spending far more money supporting and promoting cultural activities, yet the distinctly Australian component has, I think declined as has the influence of the arts broadly defined on Australian life.

It would be easy to say that this is simply a symptom of a globalising world that is progressively breaking down the barriers between and uniqueness of individual cultures.

I do not think that this is a sufficient explanation. Yes, ideas are more accessible, information flows more freely, people move more readily. Yes, on some latitudinal measures cross-cultural differences have declined. However, my impression is that differences even between apparently related cultures remain deeply entrenched.

I think that we also need to recognise that cross-cultural flows are not new.

The influence of the US film industry was, I suspect, just as strong in the 1930s as it is today. As an example, the first Government support for the Australian film industry was an unsuccessful attempt by NSW Country Party Leader Bruxner in the 1930s to aid the Australian film industry through quotas. Bruxner was worried about the influence of Holywood on Australian culture and was also first cousin of the Australian film maker Charles Chauvel.

As a second example, Australian painters have always been strongly influenced by major overseas movements in art. The Heidelberg school (and here) drew from French influences but then consciously used them to try to develop an Australian artistic style.

I think that this last point is critical. European Australia developed its own distinct culture soon after settlement. A distinctly Australian English emerged early with the currency lads and lassies, children born in Australia. A constant theme in cultural activities until the end of the seventies was the attempt to articulate what it was to be Australian, to interpret and explain Australia. Sometimes all this was a bit precious, contrived, but it had a cultural validity.

When we put aside the idea of an Australian culture and replaced it with concepts such as pluralism and multiculturalism we created a problem for ourselves at two levels.

At the first level, pluralism and multiculturalism may be important aspirations, even attributes of our culture, but they are not core descriptors of the culture. The abolition of the idea of an Australian culture, of the idea of a distinct Australia, effectively invalidated our past, creating a cultural void.

This links to the second problem. The remarkable thing is just how strongly Australian culture broadly defined has continued as a unique identity. However, because the nexus had been broken between it and our educational and more formal cultural activities, it continued as a purely popular culture, creating a growing disconnect between popular culture and the more formal expressions of culture.

Let me illustrate with a simple example.

The proportion of university students studying some form of Australian history has declined very sharply. The number of Australian history books in book stores, while now increasing, is miles below the peak of the early eighties. Yet interest in Australian history at local or family level, the number of people doing some form of historical research, has never been greater.

People want to know about their past. When the academic and educational elites concerned with Australian history moved away from broader studies to a chunked semester single theme approach determined by currently fashionable topics, they ceased to be a core part of broader Australian culture and instead moved to an academic ghetto.

The genesis of the Australian culture wars lies in the disconnect between popular culture and the more formal expressions of culture.

Australians of all ethnic backgrounds, cultures and creeds are tired of being lectured about their manifold sins and weaknesses. Deprived of cultural interpretation and validation, they have turned instead to symbols that they can understand and that express to them what it means to be an Australian. "Ozzie, Ozzie, Ozzie, Oy, Oy, Oy" may not be very profound, but it is in fact a simple expression of unity and identity.

Given my views on individual issues, I may deplore John Howard's views on some things. But his political strength, as I see it, lies in the fact that he knows Australians and has effectively captured the divide.

When I see him wearing an Akubra and mixing with Australian farmers I get a warm feeling simply because he is somehow validating things I feel. When he visits a disaster scene and hugs a victim I get a warm feeling because he is expressing the Australian compassion that I feel. When he uses terms like mate and mateship I understand.

I am just one person. But, and in memory of Alex, I would issue a challenge to all our cultural elites.

Get out of the ghetto. Start explaining to me what it means to be an Australian. Help me understand what I am. By all means, tell me what changes are required. But also tell me why I should be proud.