Ideas@TheCentre – The Centre for Independent Studies

Ideas@TheCentre

Ideas@TheCentre brings you ammunition for conversations around the table.  3 short articles from CIS researchers emailed every Friday on the issues of the week.

Anti-ISDS scaremongering based on myths

Patrick Carvalho

15 April 2016 | Ideas@TheCentre

Anti-ISDS scaremongering based on mythsA new CIS Research Report released this week makes a strong case for ISDS provisions in our free trade agreements, helping to protect Australian investors from illegal foreign government actions.

Investor-State Dispute Settlement (ISDS) is a legal provision in international agreements that enables foreign investors to take host states to an arbitral tribunal for alleged treaty breaches. The goal of investor-state arbitration is to provide a de-politicised, unbiased and law-based adjudication forum to settle international disputes.

The report debunks the widespread and unfounded myths about investor-state arbitration, showcasing it as a beacon for the rule of law in international affairs. With ISDS provisions in 21 bilateral treaties and seven free trade agreements, investor-state arbitration has served Australia’s national interests well, promoting a better global rule of law environment along with protecting Australian investors.

Contrary to what ISDS critics claim, it is wrong to fear Australia can lose sovereignty in free trade agreements such as the Trans-Pacific Partnership, currently under intense parliamentary scrutiny. There is nothing in ISDS arrangements that cannot be found in other legal instruments and procedures, with most ISDS cases overseen either by the World Bank’s or the United Nations’ arbitration forums.

The misconceptions behind much of the recent scaremongering around free trade agreements are nothing more than myths and, at times, outright protectionist bias. At the core of ISDS protections is that no one is above the law — not even the King — which is a legal principle established since the Magna Carta some 800 years ago.

The report also proposes effective policy recommendations to address valid concerns.

First, transparency of ISDS cases should be the rule as public scrutiny of ISDS rulings is critical.

Second, ISDS provisions should also ensure a well-delimited and legitimate use of investor-state arbitration. The real challenge is to get the Goldilocks balance between proper limitations and valid coverage — for which the recent TPP investment chapter constitutes a good yardstick.

Third, we need to pay attention for the Consistency of ISDS rulings and provisions. In particular, Australia should maintain its international efforts to implement an ISDS appellate mechanism. And, whenever possible, our previous ISDS commitments should be realigned to the latest advancements in investor-state arbitration provisions.

There is nothing to fear from investor-state arbitration and much to welcome it in our international commitments. And that’s the beauty of the rule of law: those who owe nothing have nothing to fear — and much to gain.

Dr Patrick Carvalho is a Research Fellow at the Centre for Independent Studies and author of the research report Investor-State Arbitration: Debunking the Myths released this week.

Oxfam opacity raises suspicions

Theodore Dalrymple

15 April 2016 | Ideas@TheCentre

Oxfam opacity raises suspicionsI happened the other day to hear a senior Oxfam Australia official speaking on the radio about the Panama Papers.

I thought it worthwhile subsequently to look up Oxfam’s annual accounts, which seemed to me in the event to be less than fully transparent, and sometimes laced with managerial language that raised my suspicions.

Oxfam’s largest donor here by far was the Australian government, which contributed slightly more than 26% of its total income — almost enough to cover the nearly 29% of its income it expended on raising funds.

It spent $3 million last year on long-service leave of its senior employees. We learn that remuneration for ‘key management personnel’ (number unspecified) rose by 16% between 2014 and 2015, from $821,000 to $952,000. (The head of Oxfam UK is paid somewhat over $200,000 a year.) No explanation for the rise is offered, but:

The performance of the Group depends upon the quality and commitment of its senior management. To prosper, the Group must attract, motivate and retain highly skilled and committed executives… 

I came across an advertisement for a job at Oxfam. Among the selection criteria for the successful candidate were the follows:

Experience in defining use cases and business rules and processes with a strong engagement of customer groups…

and

Experience in successfully mapping and documenting business and technical requirements, process diagrams, scenarios, and test plans based on conversations with the technical team and customers…

The successful candidate will be paid $75,783 plus superannuation and ‘access to generous NFP tax concessions (specifically, a salary packaging scheme offering up to $18,450 of your salary tax free)’.

Could this be tax avoidance? Surely not. I may be behind the times, but Oxfam doesn’t sound much like charity to me, more like a government-subsidised scheme for those who work in it.

Theodore Dalrymple is the Centre for Independent Studies 2016 Scholar-in-Residence, and will deliver a lecture on why ‘Society is Broken’ at the Sydney Opera House on April 18, and a lecture in Melbourne on April 21. Find more information at our Events page.

Warts-and-all evaluation may beat 'crabs in a bucket' mindset

Sara Hudson

15 April 2016 | Ideas@TheCentre

Warts-and-all evaluation may beat 'crabs in a bucket' mindsetAn evaluation report released this week provides some much-needed evidence on the effectiveness of Jawun.

Jawun is an initiative of Noel Pearson and other Cape York leaders, and involves corporate and government partners working with (rather than simply providing services to) Indigenous organisations and businesses through voluntary secondment type arrangements.

Over the years there have been some questions about the value of secondment programs, with some Indigenous leaders arguing the most valuable partnerships occur when organisations have some ‘skin in the game‘ and that it is ‘hard to critique the state of play if no-one is keeping score.’

When it comes to critiquing each other, Paul Keating once famously compared Indigenous people to ‘crabs in a bucket‘:

“If one of you starts climbing out and gets his claws on the rim, about to pull himself over the top to freedom, the other mob will be pulling him back down into the bucket. You all end up cooked.”

Noel Pearson and Cape York Partnerships are perhaps the biggest victims of this ‘crab in a bucket’ mindset, with some people in the Indigenous community actively looking for opportunities to criticise him and the work he is trying to achieve through the Cape York Reform agenda.

Unfortunately — perhaps because they fear being pulled back down into the bottom of the bucket if they admit to any failing — many evaluations of Indigenous programs read like exercises in PR spin rather than an independent and rigorous evaluation report.

To a certain extent, KPMG’s evaluation report falls into this trap, with the use of expressions like ‘the positive uplift’ Indigenous partners had experienced as a result of taking part in Jawun.

However, the report also indicates some people were not completely satisfied with their Jawun experience and that the model could be improved by better assessing organisations capabilities and capacity to host secondees effectively.

The whole purpose of conducting an evaluation is to look at what is and is not working. Trial and error is essential for learning what approaches work and what needs to be tweaked.

Providing a ‘warts-and-all’ evaluation is perhaps the best way for Jawun to silence its critics. Now if only it would release the full evaluation report on its website instead of just the executive summary.