Crossbench MPs hold the key to policy reform - Grattan Institute

Everyone knows policy reform in Australia is gridlocked. Most of the Productivity Commission’s “to do” list, the recommendations of the OECD and the proposals of the Grattan Institute have sat on the shelf for a long time.

Lots of people call for the sort of leadership Australia enjoyed in the reforming years of the Hawke, Keating and Howard governments. But those sorts of leaders are unlikely to emerge unless we change Australia’s governance.

Grattan Institute’s Gridlock report, published this week, investigates the outcomes and blockers of 73 reforms previously recommended by Grattan and many others. It finds that during the past decade governments failed to adopt any reform that was unpopular. It’s a different story to the 1980s and ’90s, when many adopted reforms were unpopular – and some of them still are. Once, governments were prepared to sponsor unpopular reforms and do their best to explain why they were in the public interest. No more.

The report also shows many reforms are blocked by shibboleths, beliefs unsupported by evidence that mark membership of political tribes. Membership of a political tribe is increasingly the key to government patronage: grants, government contracts and appointments. These shibboleths stand in the way of sensible progress on tax, superannuation and energy, three policy areas that most need reform.

Vested interests have always been a problem for government, but Gridlock shows they are much less powerful when countered by the public reports of independent bodies such as the Australian Competition & Consumer Commission, the Productivity Commission and well-constructed ministerial reviews. Unfortun­ately, in the past 20 years governments have reduced the number and independence of such bodies.

Unpopularity, tribal beliefs and vested interests have become so powerful because governance has corroded from within. The public service has been undermined so that it is less capable and too pliable to the wishes of the government of the day. There are too many ministerial advisers; they are not accountable and, rather than bringing expertise to ministers’ offices, they increasingly are party insiders looking to climb the next rung on the ladder of our growing professional political class.

Political patronage has swollen as governments abandoned conventions about nonpartisan appointments and arms-length transparent processes for grants and contracts. Government money increasingly rewards political allies and marginal electorates rather than being used where it will make the most difference.

It’s not helping that the media has fewer expert journalists and is becoming more partisan, reinforced by the echo chambers of social media. Falling trust in government also means governments have less political capital to bring the electorate with them on unpopular reforms.

Many reforms needed for prosperity are not going to happen unless we change governance first. This includes changes recommended by the Thodey review of the public service but rejected by the Morrison government, such as limiting the ability of ministers to fire heads of department, requiring more ministerial advisers to be drawn from the public service and requiring regular published evaluation of government programs.

We need to control the patronage systems that are corrupting government, by resisting partisan patterns of appointment, requiring more transparent processes for awarding government grants and contracts, and stopping the golden escalator from parliamentary and adviser roles into government relations jobs. Preferential access for vested interests needs to be curtailed with tighter limits and more disclosure for political donations and campaign spending. None of these controls will be effective unless enforced by a federal anti-corruption commission with teeth.

These changes are all wildly popular with the electorate but not with our major political parties. They have found a range of increasingly implausible excuses to ignore them for decades. Without an ongoing scandal that makes such changes the defining issue for an election campaign, major political parties are likely to continue to resist them, because they will disrupt the game of mates for party insiders. The best chance for change may come from the growing number of independent MPs if they insist on them as the price of power in a hung parliament. That’s how we got the Parliamentary Budget Office – the most significant institutional improvement in the past 15 years. Without improved governance, policy will remain gridlocked.

While you’re here…

Grattan Institute is an independent not-for-profit think tank. We don’t take money from political parties or vested interests. Yet we believe in free access to information. All our research is available online, so that more people can benefit from our work.

Which is why we rely on donations from readers like you, so that we can continue our nation-changing research without fear or favour. Your support enables Grattan to improve the lives of all Australians.

Donate now.

Danielle Wood – CEO