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.

Government gets B for consistent effort on reforms, but will have to lift its game

31 October 2014

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CIS recently hosted a visit from Institute of Economic Affairs Director of Lifestyle Economics Christopher Snowdon who summed up nicely the problem with regulation: “A lot of people are very good at doing benefit analysis”.  Costs are easily forgotten. Especially non cash costs like time, forgone opportunities and sheer frustration.

Between 2010 and 2013 an Act of Parliament was passed every two days, adding 21,000 new regulations to public, private and professional activities. Commenting on the Abbott government’s second Regulation Repeal Day, opposition spokesman Senator Joe Ludwig countered that the Gillard government had, “repealed over 16,000 acts, regulations, legislative instruments – without a fanfare” so in a spirit of goodwill let’s call it 5,000 additional rules. That’s nearly 3 new rules every day for three years.

All these rules add time, cost and confusion to daily life and deadweight losses across the economy. The Abbott government was elected with a commitment to cut $1 billion a year in red tape costs. Since the election, the PM has chalked up $2.1 billion in red and green tape savings for the business and not-for-profit sectors. To weigh the government’s boasts consistently with its bleats, we should at some point have a net figure that adds in the costs associated with the national security rules but that will need to be calculated once the full extent and impact of changes like metadata are clear.    

Senator Ludwig has criticised the government for passing off the usual abolition of redundant provisions such as the Spirits Act 1915 as regulatory reform which he says in the usual course of events, “always takes care of itself. The departments do this as part of their ordinary work. Departments will tell you that legislation such as this, old statutes, will come up, get written off and get binned. You don’t need a flying squad.” As is so often the case with politicians, he is a bit right and a bit wrong.

This latest round of reform has delivered a few minor fixes, so that for instance cattle headed to the EU no longer need a green tag on their tail — but it’s also got some meat in it.  A full list is here http://www.cuttingredtape.gov.au/2014-spring-repeal-day but these are the top three:

  • reducing duplication through a one-stop shop for environmental approvals $426.3m
  • streamlining income tax returns using MyTax $156.0m
  • making it easier for Australians to access government services $88.0m

Of these measures the biggest saving is from getting the commonwealth further out of the business of environmental approvals. States and territories will be able to autonomously approve projects consistent with the Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act).

The MyTax initiative will allow approximately 1.4 million taxpayers access to an automatically pre-populated electronic income tax return. 

The myGov service has been established to provide secure access to several departments. The clearest saving comes from allowing electronic mail from Centrelink, Medicare and Child Support to save the cost of posting 23 million letters.  A sad day for Australia Post but a happy one for taxpayers.

However, the really big deregulation opportunities remain to be addressed. Several of them can be found in the COAG Reform Council’s (CRC) final report on the National Partnership (NP) to deliver a Seamless National Economy [declaration of interest – I worked on this report].

The CRC report noted that at the outset of the NP, the Productivity Commission estimated that full implementation of the Seamless National Economy reforms would lower the cost of doing business by $4 billion a year and deliver productivity improvements capable of increasing GDP by up to $6 billion. 

A good half of the original agenda remains incomplete, or implemented in letter rather than spirit. Nationally uniform OHS laws have not been fully achieved despite estimated benefits of up to $480 million a year – roughly the same figure as the headline item in this year’s repeal day. Also incomplete are national consumer credit reforms that the Productivity Commission estimated to be worth in $1.5 billion to $4.5 billion per year back in 2008.

There are massive gains to be realised in properly deregulating the national electricity market. This task will become more urgent once people realise how little saving they get from not paying the carbon tax.  A more serious cause of rising prices over the last decade has been regulatory gaming.  Similarly, national transport regulation is a rich source of economic gains for a government willing to take on the tough challenges.  

If the commonwealth is going to go after the real savings in power, transport and infrastructure it will need to work with the states. When it is ready to do that, the CRC left some advice – you will have to bring cash to the table.  “Governments” CRC noted, “have made better progress implementing the reforms that attract reward payments than they have made on the reforms that do not attract reward payments”. During the NP, governments completed 21 of 26 reforms attached to payments but only 10 of 19 reforms without payments.

National competition reforms were greatly aided by the use of reward payments. Not only did it motivate Premiers who didn’t want to lost money to other states, it gave Treasurers the leverage they needed over line Ministers to drive unpopular or poorly understood programs of deregulation or reform.  

The government gets a B for consistent effort but will have to considerably lift its game to deliver the benefits of real market deregulation to Australian consumers, employers and taxpayers.

Cassandra Wilkinson is the External Engagement Manager at the Centre for Independent Studies.

Road to hellish environmental concern

31 October 2014

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They say the road to hell is paved with good intentions. Unfortunately the Anglican Church of Australia seems to have set out on its own journey to that fiery destination.

Campaigners in the Anglican Diocese of Perth, led by convicted Hilton bomber Evan Pederick, have followed national church policy and forced the Perth synod to dump all its fossil fuel investments.

Other dioceses, as well as Anglican National Super which provides superannuation for the wider church, have now followed Perth’s lead.

According to Pederick, the decision to sell off coal, gas and oil holdings was an entirely moral one taken to protect God’s creation and the livelihoods of human beings.

But as The Australian’scolumnist Gary Johns has pointed out, “an effective divestment campaign would increase the cost of power and harm the poor.”

Just who is the church trying to help? Fuel costs are already on the rise hitting poorer people hard in the hip pocket. The church doesn’t seem to care much about them.

Nor is it concerned to protect the jobs of those who live in communities like the NSW coalmining town of Denman.

“At the heart of this issue is people with mortgages, people with families,” says Jody Zammit, a priest in the Anglican Diocese of Newcastle where coal has been the lifeblood of the region for years.

There is little sign the church is being mindful of any issue concerning the well-being of families, communities and people. Nor is it thinking seriously about energy policy.

Nuclear power would be a good alternative to power derived from coal, but the Anglican Church is dead set against that option. And it’s not much keener on cheap, affordable hydro-electric power.

In fact, the Anglican Church is probably not so much concerned with developing an effective national energy policy as it is with struggling to secure its own survival as church attendance drops.

Ageing church members are dying off leaving empty pews that are not being filled by new parishioners. As a result, the size of the Sunday collection put in the plate each week is dropping too.

The church is desperate to connect with a younger generation of people and to stem the drift away from church life.

Many Anglican church leaders think that greater advocacy on fashionable issues such as safeguarding the environment will help them connect with that missing generation.

But while the church is pursuing the idealistic environmentalists it will actually be harming working parents with families to raise, bills to pay, and homes to heat.

G.K. Chesterton once said, “Those who marry the spirit of the age will find themselves widows in the next.”  The Anglican Church of Australia is making the very mistake which Chesterton warned about.

No doubt church leaders are well-intentioned. But sometimes good intentions are not enough. Especially when the consequences of actions have a whiff of sulphur about them.

Rev Peter Kurti is a Research Fellow at the Centre for Independent Studies

No organised and synchronised cabal of anti-public education ‘neo-liberal’ ideologues

31 October 2014

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In a speech to the Australian College of Educators this week, distinguished and respected professor of education Stephen Dinham took a verbal hatchet to what he describes as ‘myths’ and ‘beliefs’ that have been “accepted almost without evidence or questioning in Australia”. 

Dinham lists twenty ‘myths’ that he says have been imported from the US and the UK, and are being advocated by people keen to promote the idea that there is a ‘crisis’ in education.

There is much in Dinham’s speech with which I agree and much that I don’t, but my strongest impression is that I do not recognise his characterisation of the debate over education policy in Australia. It implies that all the people who have something to say about school education in Australia can be split into two mutually exclusive groups— the “silent or silenced” educators who reject the ‘myths’ Dinham lists, and the powerful ‘vested interests’ who promote them.

This is not my impression. The relatively small group of people who are frequent contributors to the public debate over education hold a variety of views. People who think greater autonomy for schools is a good idea often find themselves on the opposite side of the table on NAPLAN and My School.

People who agree about the value of NAPLAN and My School don’t necessarily have the same attitudes to international rankings. Not everyone who is open to the concept of charter schools thinks that “choice and competition are the answers to almost any question about education”.

Last week, I participated in a panel discussion at the annual conference of the Australian Primary Principals Association. The range of comments expressed by the six panellists exemplified how unhelpful it is to conceptualise such discussions as an argument between two opposing camps.

Everyone has a different — and often unpredictable — set of views informed by their own knowledge and experiences. There is no organised and synchronised cabal of anti-public education ‘neo-liberal’ ideologues, only a diverse set of individuals who for the most part have the best interests of Australia’s children at heart.

Jennifer Buckingham is a Research Fellow at the Centre for Independent Studies