Treatment of Risk in Public Policy

Photo: Gordon Smith, Snake in the Grass. One of the natural hazards of the Australian bush. A 5 ft long and venomous Red-bellied black snake in search of supper. Red-bellied black snakes are shy. Leave them alone and they will leave you alone. Poke them, and you will get bitten.

Continuing my musings on the modern obsession with risk, in my post ICAC and the NSW HSC - the Legalisation of Australian Life, I suggested that:

Our focus on risk and on legal responses complicates and distorts the whole policy process from beginning to end, from the way we define the problem to be addressed through the definition of solutions to the application of the selected solutions.

In this post I want to look at some of the reasons why this is so.

The problem begins with us, in the way we define the things we consider to be important, in the way we respond when things go wrong.

Take, as an example, the pre-occupation with law and order.

We have all had direct or indirect experiences with crime.

In my case, I was burgled twice in Queanbeyan, we have been burgled three times in Sydney, a car was stolen while we were staying at South West Rocks. Aunt Kay's bag was stolen from her house in Armidale. My eldest has had her bag stolen twice, once at the pub, once at a party. So on this list alone we have five burglaries, one car theft, three cases of petty theft.

People affected in this way become concerned and demand responses. Politicians respond by beating the law and order drum.

This is not new - from memory, the phrase law and order dates back to at least the sixties - but it has all become more intense in recent years. Our prison populations have exploded, with an increasing proportion of the population and especially the young criminalised - classified as criminals.

The difficulty in all this is that the perceived problem - the risk of crime - is usually a symptom of a broader problem.

Take, as an example, the theft of our car by two aboriginal youths from Macksville who then used it to conduct a mini crime spree. They were caught and have probably ended up swelling the ever growing number of Aboriginal young in the NSW jail system.

Here I cannot regard their actions as a law and order problem, although the trashing of the car was indeed a breach of the law and was certainly a problem for us. Rather, their actions were a symptom of a broader problem, the lack of opportunities for the young in that area and especially the Aboriginal young.

So my response has been to campaign in my own limited way through this and the New England Australia blog for action to improve economic development in the Mid North Coast. Without this, the problem will simply perpetuate itself.

My point in citing the law and order case is simply to suggest that the public response - our response - to the perceived risk of law breaking and the consequent response from law makers does not really address the core problem, but instead arguably makes things worse.

We, the public, then compound the problem by our general response when something goes wrong.

The management literature suggests that a good manager is one whose decisions are more often right than wrong. There is still an acceptance that some decisions will be bad. The position in the public sector is very different. There the focus is on the 5 per cent of decisions that go badly wrong, not the mass of decisions that are right to some degree.

This has always been true and is one of the reasons why the dynamics of public policy are so different from decision making in the private sector. However, recently the problem has, I think, become much worse because our collective approach to risk and the avoidance of risk makes for much harsher responses when failures occur.

If we, the public, attack our Governments and political leaders when something goes wrong in the way we do now, then we cannot blame them for moving to positions that will avoid risk while trying to meet our demands for action.

Those who read this blog will know that I have been very critical of the NSW Government. I do not resile from those criticisms. However, I have recently had cause to look at a range of internal NSW documentation from Cabinet decisions through Cabinet Minutes to various process documentation.

For obvious reasons I cannot comment on specifics. I can say that the need to avoid risk of one type or another is pervasive. But I find myself in the odd position given my public statements that I can sympathise and understand. I may disagree and think that it leads to sub-optimal policy responses, but the Government is working within the bounds that we, the public, have set by our responses.

I cannot give specific details, but will try to illustrate by a generalised example.

Say we have a problem. The best response is action x, but it carries risk y. If x occurs, we will get a really good result. See, Neil, I am still avoiding the use of a certain word. But if y happens, then the opposition and public will heavily attack the Government.

The alternative is action z. This really is sub-optimal, but carries reduced or no risk. Who can blame the Government in this case for going with z? We, the public, have ensured this result.