Brian Mitchell (Lyons, Australian Labor Party) Share this | Hansard source

The Statute Update (Smaller Government) Bill 2017 will enable the abolition of seven Commonwealth bodies: the Central Trades Committee; the Oil Stewardship Advisory Council; the Product Stewardship Advisory Group; the Advisory Group of the Australian Sports Anti-Doping Authority; the Plant Breeder's Rights Advisory Committee; the Development Allowance Authority; and the Corporations and Markets Advisory Committee, the sad passing of which my colleague the member for Bruce has just lamented. This bill follows a series of government decisions relating to the abolition of a number of bodies announced in earlier tranches of the so-called smaller government agenda.

Labor is not opposing this bill, but that should not be taken as support. We do not support the abolition of these bodies, but the fact is they have been gutted by the government and exist in name only—as zombies, as my colleague just remarked—with members not appointed and staff and funding removed. Some of the bodies are redundant, with their work now done elsewhere, but others could have continued to play an important role. This government, however, continues to take an axe to services and bodies whose wise counsel might prove inconvenient to its extreme right-wing agenda.

Part of that agenda is an obsession with cutting government services and slashing what it likes to dismiss as red tape—those inconvenient things like regulations about health standards and environmental management. Smaller government is a right-wing idea that has been popular since Reagan and Thatcher. It's attractive to libertarians, economists and CEOs who prefer to see democratically elected governments get out of the way of corporations, which they believe should be as unfettered as possible to make as much money as they can, irrespective of the social consequences.

The notion of smaller government appeals instinctively to voters who choose to believe claims that it leads to more money in their pocket, despite all evidence to the contrary. We already have a small government in Australia. I know, it's mind-blowing. Cutting it more is no recipe for better days ahead. Smaller government is voodoo economics. More than 150,000 people are employed by the Australian Public Service, which, on average, is a little more than 1,000 per electorate. Of course, electorates like mine in regional Tasmania have far fewer, while electorates here in Canberra and the big capitals have far more; but on average it is about 1,000 per seat. Australia has about 24 million people, so on a population basis that is one Australian public sector employee per 160 people. Imagine the scene: there is your one Australian public sector employee behind a desk in a tiny town of 160 people and they all want advice, service and action on every federal issue such as defence, health, education, social security, pensions, AFP, immigration, aged care, parliamentary services and more. That person would get worked to the bone just fielding the calls and emails, let alone doing the work. No wonder public sector employees are regarded as amongst the most efficient and hardest working in the world.

Disappointingly, 18,000 of those 150,000 are contract workers. So, while those opposite might like to boast of how they're keeping public sector growth under control and how committed they are to smaller government, what they're often doing is simply outsourcing the work. It still needs to get done and be paid for. It just doesn't show up in the books as public sector wages. But, at the end of the day, voters don't save any money and they arguably get a poorer level of service when government services are outsourced and contracted out for profit motive.

Ian McAuley, a lecturer in public finance at the University of Canberra, questions an often uncritical support for the smaller government ideal. In an extended essay published by the Australian Collaboration, The Australian economy: will our prosperity be short-lived? he writes:

Contrary to some perceptions, Australia has a small public sector, and a low level of government debt. Successive governments have kept taxes and deficits down by keeping expenditures down. As a result Australia has one of the smallest public sectors of all developed countries.

Public spending is essentially divided between goods and services, including physical infrastructure such as roads, ports, schools, hospitals, health care, education services and consumer protection, and transfer payments, such as pensions, family allowances and industry subsidies. McCauley argues that Australians have yielded to pressure for ever-increasing spending on transfer payments, with the share of total federal spending on social security rising from 21 per cent in 1972 to 33 per cent today—and that doesn't count the ever-growing amount of revenue foregone in the form of tax concessions for superannuation, private health insurance, capital gains and much else.

Combine the growth in transfer outlays and foregone revenue and what is crudely termed middle-class welfare with the pressure to limit overall spending and not increase overall taxation, and what gets crowded out in the middle is investment in public goods and services—health, education, those sorts of things. So for years Australia has been squeezing investment in education, particularly tertiary education. We see this week a higher education bill before the parliament that seeks to make Australians pay more for their studies and cuts billions of dollars out of higher education from what was promised by the Liberals before the last election. At a federal level we have neglected investment in physical infrastructure and environmental protection at the national level. These are important investments if we're to continue to have a prosperous economy in a world where success rests on the best use of human and natural resources. The Australian public has become far too familiar with computer meltdowns, glitches and system errors from government agencies jeopardising quality of life and privacy. These problems are a direct result of ongoing assaults on public sector staffing levels. There are so many examples, but let's run with just a handful.

The ATO pay deadlock is simply the latest evidence of a broken public sector failing to fulfil its most basic duties to the nation, according to insiders in the ATO. Shrinking the ATO by an incredible 4,000 people has been inefficient and has led to information leaks, delays in processing, loss of morale and loss of key agency culture and corporate memory. These are irreplaceable. After the recent staff cuts of 4,000, 'unexpected delays in recruiting additional staff at reduced classification levels', according to the ATO, led to lower than expected employee expenses in 2015-16, but that didn't result in a saving. That was because the high number of contractors needed to implement critical IT projects and deliver services meant supplier expenses were higher than expected. Of course, then there's the Centrelink robo-debt shambles and, before that, the census debacle.

James Whelan, research director of the Centre for Policy Development's Public Service Research Program, says Australia underinvests in its Public Service compared with other OECD countries and shrinking the bureaucracy affects government services, program delivery, policy advice and financial management. He sees it as counterproductive, stemming from an ideological desire to scale back government, and says bureaucrats make an easy target because of the misconception that they really don't do much—they're just shiny bums sitting around. Whelan says:

We've probably become a little accustomed to Public Service bashing. It's like the public sector has few outspoken allies or advocates. To the extent that that's true, the public sector is vulnerable.

He's right. Public sector bashing is a national sport. It's not one I like to engage in. I think public sector employees do a great job. I'd like to give a shout-out to every public sector employ in this chamber!

Writer and entrepreneur Tim Dunlop argued, in a 2012 opinion piece called 'Small government can equal big problems':

For the longest time we have been told that getting the government out of government is liberating. We have been told that 'free markets' and 'free enterprise' makes us free. Indeed, this is exactly the sort of argument our newly installed 'Freedom Commissioner' takes as gospel, and that has long been argued by his former employer, the group-think tank, the IPA. It is the logic that has been used to justify the imposition of the 'Washington Consensus' in countries all around the world.

The newly installed 'Freedom Commissioner' Dunlop referred to, of course, now occupies a seat on the government benches. Indeed, the member for Goldstein is but one of a handful of IPA alumni infecting those opposite with their noxious neoliberalism and shrill demands to reanimate the rotting corpse of trickle-down economics. My colleague the member for Lilley, named finance minister of the year by Euromoney magazine in 2011, has said in this House—

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