|David Marsh and Chris Lewis
Chapter 15: Evaluating Policy Success
In this Chapter we examine the ‘success’ of the Gillard Government, relying mainly on the expositions of various policy issues in this section of the book. To evaluate policy success or failure, we rely primarily on Marsh and McConnell’s heuristic (Marsh and McConnell, 2010; McConnell, 2010), which is one of the first attempts systematically to analyse policy success/failure. This heuristic is useful because it looks beyond most analyses of policy success which focus exclusively on the programmatic dimension of success, recognising two other dimensions of success; process success and political success. Here, we begin by outlining the heuristic and developments of it, before considering the Gillard Government’s performance in a broad range of economic and social policy. In addition, and in contrast to the Marsh and McConnell heuristic, we also examine policy areas in which there was little or no change, even where there were significant demands for such change.
The Conceptual Frame: Assessing Success
The Marsh and McConnell Heuristic
The question of policy success has received limited academic attention. In fact, more attention has been paid to the question of policy failure (Adonis, Butler and Travers, 1994; Bovens and t’Hart, 1996; Boin, McConnell and t’Hart, 2008), or related concepts such as scandals (Tiffen, 1999; Garrard and Newell, 2006), crises (Boin et al., 2008) and disasters (Handmer and Dovers, 2007). Obviously, focusing on failure is important, given that, if we understand why a policy has failed, we may be able to learn from the mistake and improve policy making in that field, and others, in the future. However, such a focus may neglect the fact that some, at least, policies are a success.
In our view, we need to focus on both policy success and policy failure, in effect to see the two as at different ends of a continuum; an issue we return to below. In addition, we would emphasise two other, related, points. First, policies are rarely either a total success or a total failure; many, if not most, exist in what McConnell (201o) terms the ‘gray area in-between’. In particular, using the framework we adopt below, a policy may be a success on one dimension, process, programmatic or political, and less successful, or unsuccessful on another dimension. Second, and relatedly, even on a single dimension, a policy may be successful in some ways, but not in other.
When research has turned its attention to assessing the success of policies, the focus has been narrow, with the concentration almost exclusively upon the extent to which the aims/objectives of the policy have been met; what here we term, following earlier literature, the programmatic dimension of success. Much of this work has been done by economists and, perhaps consequently, it ignores the fact that policies are incontrovertibly ‘political’. In our view, shared by the emerging literature on success, we need to go beyond a focus on the programmatic dimension, to acknowledge the importance of other dimensions when we are trying to assess success.
To date, the key work on ‘policy success’ is that by Bovens, t’Hart and their various collaborators (Bovens, t’Hart and Peters, 2001), Marsh and McConnell (2010) and McConnell (2010) and Rutter, Marshall and Sims (2012). We have reviewed this literature elsewhere (Marsh and Lewis, 2014). Here, we focus on the Marsh and McConnell heuristic, while acknowledging that it builds on a critical appreciation of the work of Bovens, t’Hart and Peters (2001).
The Dimensions of Policy Success
Marsh and McConnell add a process dimension to the programmatic and political dimensions identified by Bovens, t’Hart and Peters (see Table 1). In addition, they discuss a series of complexity factors, which are important to acknowledge in undertaking any assessment of policy success/failure, here we consider two: the fact that one person/group’s success may another person/group’s failure; and the temporal dimension, whereby politicians operate with a limited timescale for assessing success (see Marsh and Lewis, 2014).
The process dimension of policy formation is important, but rarely considered in any assessment of policy success. By ‘process’ we are referring to the initial stages of policymaking, where issues and options are framed, options considered, interests consulted and decisions made. Often policymaking is more rushed and less considered, but, nevertheless, processes are important, in both practical and symbolic terms. In particular, a policy process which is thorough and ‘constitutional’ confers greater legitimacy on policy outcomes, even if/when those outcomes are contested. So, establishing or conferring legitimacy is an important indicator of process success.
Table 1: Three Dimensions of Policy Success: The Marsh and McConnell Framework
Preserving Policy Goals and Instruments
Building a Sustainable Coalition
Efficient Use of Resources
Enhancing Electoral Prospects/Reputation of Government and Leaders
Controlling the Policy Agenda and Easing the Business of Governing
Sustaining the Broad Values and Direction of Government
Source: Adapted from McConnell (2010), Table 2.2, p. 46.
It is widely assumed that programmatic ‘success’ is more likely if the policy process involves, and reflects the interests of, a sufficiently powerful coalition of interests. The key point her is that, for the policymakers, putting together a strong alliance to support a particular policy is a putative measure of process success. Of course, a process success is likely also to be measured in terms of the Government’s capacity to get a Bill through the legislative process without alterations to its key objectives or detailed policy instruments.
As we emphasised, Programmatic success is often seen as synonymous with policy success and the contemporary focus among most Western democracies on evidence-based policy making, or, as Tony Blair’s put it, ‘what matters is what works’, is further confirmation that the assessment of success is outcomes-based and judged by ‘the evidence’ (Parsons, 2002; Sanderson, 2002). Here, a policy is successful to the extent that it achieves its objectives. Hence, there is a significant focus on effective policy implementation, together with a recognition that this is a more complex problem, given the growth of multi-level governance and public sector fragmentation (Exworthy and Powell, 2004).
Another aspect of programmatic success focuses more directly on the operation of policy, whether the policy instruments are appropriate, the skills of those delivering the policy adequate and the resources available sufficient to ensure that the policy is implemented as intended. This focus on the effective use of resources has been reflected in the growth of public audit bodies, value for money studies, national competition councils and productivity commissions. In this context, policy success is often claimed on the grounds that the policy led to ‘waste’ reduction, cost cutting or more efficient use of available resources.
Political success is crucial from the perspective of the government and the governing party. Crucially here, a policy is seen as successful if it assists the government’s reputation and electoral prospects, evidenced perhaps in public opinion polls. Of course, a policy can also help the government retain control of the political agenda or help it retain its image of governing competence and the idea that it is ‘on track’, while, in contrast, a policy disaster may undermine that image and presage electoral defeat.
When considering these different dimensions of policy success, it is important to recognise, as Bovens, t’Hart and Peters (2001) acknowledge, that a policy may be a success on one dimension, but not on another. For example, the Home Insulation Programme (HIP), introduced by the Rudd Government, was, in many senses at least, a process success, but, in most senses, a programmatic disaster (REFS). In addition, a policy may be successful along one dimension at one time, but this may change over time. Again, the HIP provides an example here, as it was initially a political success, but subsequently a political disaster.
Even if we recognise the various dimensions of policy success, the issues/problems involved with assessing/measuring success don’t end there. So, Marsh and McConnell (2010) identify a number of what they term complexity factors, particularly: the importance of ontological and epistemological issues; the question of success for whom; and the fact that success varies across time, space and cultures. Here, we consider only two of these issues: the question of success for whom; and the temporal dimension involved in accessing success (for a discussion of the other factors in relation to the ‘success’ of recent Australian policy making see Marsh and Lewis, 2014).
Marsh and McConnell emphasise that any policy is unlikely to affect all citizens equally. Indeed, the nature of politics means that outcomes will always be, to some extent, contested. So, we should not expect government, politicians, civil servants, interest groups, citizens and others to all agree on whether, or not, any aspect of a particular policy is successful. At the same time, some policies may benefit some interests/sections of society, while disadvantaging others, given that politics and policy is sometimes, perhaps often, a zero-sum game. Inevitably, this raises crucial issues about power relations and a key question becomes the extent to which one interest or set of interests is consistently benefited (Marsh and McConnell, 2010, 575).
The temporal dimension of policy making is particular important, given that the timeframes with which politicians operate, clearly related to electoral cycles, are much shorter than those necessary to assess whether a policy has been successful (see Marsh and McConnell, 2010, 577). Sometimes, this difficulty can be exacerbated by political factors, so a government can introduce a policy which is then repealed by a succeeding government, before there has been a chance to assess whether it has been successful in programmatic terms. Here, the key issue is that the time-scale of the Gillard Government is insufficient to definitively, perhaps even adequately, judge whether a policy was a programmatic success. At best, we can suggest that it appears likely a particular policy will be a programmatic success/failure. All this means that the process and political dimensions feature more strongly in situations, such as this, where an assessment of policy success is being conducted with a short time-frame.
Beyond Marsh and McConnell
McConnell (2010a) deepens and broadens the discussion by emphasising that the distinction between policy success and policy failure is not an absolute one. He identifies (McConnell, 2010b) five points on a ‘spectrum of success’: process success; resilient success; conflicted success; precarious success; and process failure.
Table 2: Policy as Program: The Spectrum from Success to Failure
Implementation in line with objectives.
Implementation objectives broadly achieved, with minor changes.
Mixed results, some
successes, but also unexpected problems.
Minor progress towards implementation as intended, but beset by chronic failures
Implementation fails to be executed in line with objectives.
Achievement of desired outcomes.
Outcomes broadly achieved, despite some shortfalls.
Some successes, but partial achievement of outcomes counterbalanced by unwanted results.
overwhelmed by controversial, high profile failures.
Failure to achieve desired outcomes.
Creating benefit for a target group.
A few shortfalls, but intended target group broadly benefits.
Partial benefits, but not as widespread or deep as intended.
overshadowed by damage to beneficiary group.
Damaging a particular target group.
Meets policy domain criteria.
Some minor shortfalls in relation to desired outcome.
Partial achievement of
goals, accompanied by some failures.
A few minor successes, but plagued by
unwanted media attention.
Clear inability to meet the criteria.
Opposition to program aims/values/ implementation virtually non-existent
Some opposition to program aims/values/ implementation,
but outweighed by support.
Opposition and support for program aims/values/ implementation equally balanced.
Opposition to program aims/values/ implementation outweighs support.
Opposition to program aims/values/ implementation virtually non-existent.
McConnell’s continuum is laid out in Table 2. He examines the continuum in relation to each of the three dimensions of policy success; process, programmatic and political success. The Figure largely speaks for itself, but the key point is, again, that we need to be much more sophisticated about how we conceptualise, and therefore assess, success than is the case in the mainstream, rationalist, literature, which treats the measurement of success as a straightforward, largely technical, exercise.
The Gillard Government’s Record
Here, we could have looked at individual policies, or policy fields, and assess, for either or each, whether it was a process, programmatic or political success. However, instead, we organise our treatment in terms of the Marsh and McConnell frame, assessing the policy output of the Gillard Government in relation to each dimension of success. Subsequently, we will examine a number of areas in which there were no policy innovations, on the grounds that this also tells us something about the policy ‘success’, or otherwise, of the Gillard Government.
In broad terms, as Chapter Three, the Gillard Government was successful in getting policy through, even in the context of minority government. So, as Singleton (Chapter 3) emphasises, 561 pieces of legislation received Royal Assent, compared to 549 during the last term of the Howard government and 409 for the Rudd Government. Notably, no government bills were defeated on the floor of the House of Representatives although five were withdrawn by the government through lack of sufficient support. This success was achieved despite 50 per cent of the bills introduced into the House of Representatives being contested by the Opposition (Singleton, 2013).
The best examples of process success were in the social welfare, health and education fields; areas of Labor’s historical policy strengths. Here, we would point to four substantial policy initiatives which were achieved, although often through compromise, and rarely with total community and political support.
The National Disability Insurance Scheme (beginning July 2013) which had bipartisan political support.
A new hospital funding scheme concluded with all State Premiers and Territory Chief Ministers to provide the States with $16.4 billion from July 2014 to 2020, including strict national standards, such as a four-hour emergency treatment “target” and the delivery of 95% of elective surgery procedures within a recommended time (Packham and Kelly, 2011).
A National Education Reform Agreement which offered $14.5 billion extra to primary and high school education over six years; although only NSW, South Australia and the ACT signed up by the end of the Gillard Government. For the first time, there was a funding entitlement and formula for all students, regardless of whether they attend government or non-government schools (Ferrari, 2013). With a base level of funding for each student starting in 2014 at $9,271 for a primary student and $12,193 for a secondary student, amounts would be topped up by “loadings” targeting categories of disadvantage, based on disability and low socio-economic status (Hurst, 2013).
A $4.1 billion dental package, supported by the Australian Dental Association, the Australian Medical Association, the Public Health Association of Australia and the Australian Healthcare and Hospitals Association; although most of the money would not be available until 2014. This included $2.7 billion over six years to give free or subsidised dental care to 3.4 million children (aged 2 to 17) for families that qualify under Family Tax Benefit A, up to $1,000 over two years. Another $1.3 billion would go to State-run public dental clinics to fund 1.4 million dental services for low-income adults, while $225 million will be spent on improving facilities and boosting the dental workforce. These programs allow the closure of the Howard-era Chronic Disease Dental Scheme, which cost taxpayers nearly $1 billion annually, and Labor's own Teen Dental scheme, which cost $65 million in 2011-12, but had consistently failed to hit its targets, because it funds only check-ups and not the treatments found to be needed cleaning and fillings (Cresswell, 2012). This was despite the Chairman of the Association for the Promotion of Oral Health (Professor Hans Zoellner) arguing that few children needed enough dental treatment to get near the $500-a-year cap, whereas the few children with more serious problems would be disadvantaged by the new cap and were previously covered by the much higher $4250 limit available through the CDDS (Cresswell, 2012).
However, elsewhere, the pattern is more mixed. So, the controversial carbon tax, which, as we shall see later, was a major ‘programmatic’ and ‘political’ failure, could be seen as a conflicted process success, because, while the policy was introduced without major amendment, and accompanied by a taxation reform that increased the tax free threshold to $18,200, its implementation was strongly contested and this clearly affected its chances of programmatic success (Check carbon tax chapter).
In the same vein, while the Murray Darling Basin Plan (MDBP) could be viewed as a sensible attempt to balance economic and environmental sustainability, the supposed consultation process which underpinned its development was deeply flawed. As Linnegar (2012) argues: ‘the (Murray Darling Basin) Authority (MDBA) simply turned up in rural towns, told the local residents, business people and farmers that somewhere between 30-40 per cent of the water sustaining the town (some 3,000-4,000 gigalitres) would be removed and then left’. As such, the MDBP was generally perceived by affected rural and regional communities to have failed to respond to their interests and as a cave-in to urban city voters. While later concessions were made to rural/farming interests and the MDBA has significantly changed its approach, this is still, at best, a conflicted process success (Evans Ref).
While the Rudd Government’s flawed handling of the Resource Super Profits Tax was one of the main reasons for the replacement of Rudd by Gillard as Prime Minister, the compromise Gillard subsequently agreed with the mining sector was a major process, and indeed programmatic and political, failure, given Labor’s initial aims (see Bell and Hindmoor, 2013; Lewis, Marsh and Chesters, 2013). The 2012-13 Budget set aside the putative proceeds of the new tax to fund: family payments; a bonus for school-aged children; small business tax breaks; and a compulsory superannuation increase. However, the scale of the tax was heavily curtailed, as a result of concessions to the big miners. So, the Minerals Resource Rent Tax (MRRT) established a 30% tax on just a few minerals (iron ore and coal), whereas the initially proposed Resource Super Profit Tax had proposed a 40% levy on all extractive industry. Consequently, the tax yield was derisory. It is difficult to see this as other than a process failure, as the Government failed to argue its case strongly enough to the public in the face of pressure from the miners (see Lewis, Marsh and Chesters, 2013).
As we argued, it is still too early to judge the programmatic success of most of the Gillard Government’s policies given the short-time frame. This is particularly true in the case of the Government’s four main process successes: the National Disability Insurance Scheme; the latest hospital funding scheme to operate from July 2014 to 2020; the dental reforms; and the National Education Reform Agreement.
However, the Gillard Government had a number of major programmatic failures. Here, we highlight three examples: the budget surplus and related economic policy; the carbon tax; and the mining tax. At the same time, it important to emphasise that judging a policy a programmatic success, almost by definition, involves a longer time frame than judging a policy a failure.
Gillard committed to delivering a budget surplus by 2013-14 in her first press conference as Prime Minister on 23 June 2010. This commitment is dealt with at more length by Garnett and Lewis, who argue that it was a policy largely driven by the Opposition. However, as Garnett and Lewis emphasise, in the Gillard years, average Government spending, as a proportion of GDP, was 24.6%, while average Government receipts were 23.5% of GDP. Garnett and Lewis argue that this deficit resulted from a combination of a failure to rein in public expenditure and seriously over-optimistic estimates of receipts from the carbon and mining taxes. In addition, they point out that Australia had its highest-ever debt levels and this was recalculated by Rudd’s new Treasurer, Chris Bowen, as standing at $30billion, up from $18b three months earlier. In this context, the Government withdrew its commitment to balance the budget at the end of 2012; which reflected a political, as well as a programmatic, failure.
At the same time, the Australian Bureau of Statistics indicated that Australia’s employment rate was 13.1%, if one included: those who worked just one hour a week; discouraged jobseekers; the underemployed; and those who wanted to start work within a month, but couldn’t begin immediately (ABS, 2013). In addition, the average hours worked per Australian worker declined from 35 in the 1980s, to 34 in the 1900s, 33 since 2000; reaching 32.9 in 2011 (ABS, 2012). Total manufacturing employment fell to 938,300 in the March 2013 Quarter, thus meaning that manufacturing job losses under Rudd-Gillard were 143,300 (Mirabella, 2013). Manufacturing’s share of Australia GDP also declined further, to 7.1% in 2011-12, after being 11.2% in 2003-04 (Colebatch, 2013). In addition, despite a low Consumer Price Index being aided by periods of low food prices, there was double-digit growth in electricity prices after 2007, including 14% in 2012-13 (Wood, 2013). Overall, this is hardly a picture of success in terms of economic policy.
The carbon tax, legislated as part of the Clean Energy Bill 2011 and intended to last for three to five years before a full emissions trading scheme (ETS) was implemented (Packham and Massola, 2012), can also be seen as a major programmatic failure. It is true that the Climate Commission revealed that Australia’s emissions from electricity generation dropped by 4.7% between 2010 and 2011. However, this was because of the greater use of renewable energy and a decline in Australia’s manufacturing sector (Marszalek, 2013), rather than the carbon tax (Dennis and McIntosh’s chapter). More broadly, global CO2 emissions reached a record 31.6 gigatonnes in 2012 (Zhu, 2013), while the average concentration of atmospheric carbon dioxide reached 400 parts per million in some monitoring stations (Artic and Hawaii), with a recent prediction that the level would rise to 450ppm would be faster than previous rates of increase (Landau, 2013). Of course, supporters of the carbon tax may argue that it is better than doing nothing, but it is hard to argue that it has delivered in either economic or environmental terms. In addition, the Government failed effectively to counter the Opposition argument that it would lead to higher electricity prices and a loss of Australian jobs offshore; a political failure.
As Garnett and Lewis stress, the carbon tax was designed to be budget-neutral, raising $4 billion in the first year, which would pay for compensation, tax cuts and clean energy programs. However, the Treasury’s forward estimates for the period when Australia moved to an ETS were based on an assumption that the carbon price would rise to $38/tonne by 2019. In early 2013, the European Union’s carbon price, to which the Australian one will be fixed, was $6/tonne. The problem is, of course, that the Gillard Government’s policies which will require heavy expenditure, like the Gonski reforms or the National Disability Scheme, are dependent, in large part, on a high carbon price generating significant income.
The mining tax is also widely viewed as a programmatic failure. As Garnett and Lewis emphasise, the Gillard Government had originally budgeted for the tax to raise $3.7 billion on average during its first three years (2012/3-2015/6), but raised just $126 million during its first six months. In large part this results from the concessions which the Government made to the large miners during the evolution of the legislation (see Garnett and Lewis, 2013; Bell and Hindmoor, 2013; and Lewis, Marsh and Chesters, 2013). Here, we can see how process failure linked to programmatic failure.
Political success is not easy and, as the introduction to this volume indicates, there were several contextual realities that may have hindered the Gillard Government’s prospects of political success, particularly its minority government status and the tough economic environment.
However, as we have seen, both process and programmatic terms failures hindered the Government’s prospects of political success. Here, we are thinking particularly of the inaccurate budget predictions, along with the mining and carbon taxes. In the case of the latter, the political reputation of the Gillard Government was also severely damaged from the start of its term when it reneged on a promise not to introduce a carbon tax, without community debate, a development which Ireland (2013) argues reinforced a negative public perception of Gillard that had originated in response to the way in which she overthrew Rudd.
In contrast, Johnson (2011a and b) argues that Gillard had the chance to utilise the past Labor tradition of enhancing educational opportunity and to build upon Rudd’s initial promotion of the National Broadband Network and the National Disability Insurance Scheme, not to mention the Rudd Governments’ efforts to avoid economic recession. In that context, he suggests, the Gillard Government’s many policy failures entrenched an unfavourable view of its economic competence. So, early in Gillard’s term, Labor only trailed the Coalition slightly (43% to 40%; Newspoll, 13-15 August, 2010) in terms of economic governing competence, by early 2013 it tariled 28% to 50% (Newspoll, 23-26 February, 2013), at a time when Australia had one of the lowest OECD unemployment rates at around 5% (OECDa).
The Government’s political standing was also weakened by its decision to appoint the former Liberal MP Peter Slipper as Speaker of the House, given he later resigned for inappropriate conduct (Ireland and Wright 2012), and its support from the disgraced former Federal Labor MP Craig Thomson, who was arrested on 1 February 2013 and charged with 150 counts of fraud, because of his previous conduct as head of the Health Services Union, which had already led to civil action against him.
Towards the end of its term, this lack of political success led the Gillard Government to modify its policy stance, often seeming desperate to court popularity. One of its biggest policy reversals occurred in regard to asylum seekers (see Walsh). Initially, the Government, like the previous Rudd Government, opposed the Howard Government’s offshore processing approach, using the Nauru option, on the grounds that it was not a signatory to the UN Refugee Convention. As such, they preferred East Timor as a location for new detention and processing facilities, although this proposal was rejected by the East Timorese (Kelly, 2010). Subsequently, on 31 August 2011 the High Court rejected an alternative plan to exchange 800 asylum seekers for 4,000 processed refugees from Malaysia (Gordon, 2011), given it was also not a signatory to the UN Refugee Convention, which by that time Nauru had signed. The Government then, after convening and accepting the recommendations of the Expert Panel on Asylum Seekers panel chaired by Angus Houston, moved towards the resumption of processing at Nauru and Manus Island, endorsing the plan during August 2012. During October 2012, the Gillard Government confirmed support for offshore processing and announced the re-opening of sites at Nauru and Manus Island, in response to growing numbers of boat arrivals, along with reported deaths at sea. In line with the recommendation of the panel, the Government also increased Australia’s humanitarian program to 20,000 places in 2012-13 from 13,750 for 2011-12 (Gillard and Bowen, 2012).
During June 2013, the Government even introduced tougher legislation to require subclass 457 visa sponsors to demonstrate that there are no qualified and experienced Australian workers readily available to fill a position to be taken by a proposed 457 visa holder, unless an exemption applies. They did so, despite previously ignoring criticism from trade unionists and Labor MPs during May 2012, when re-stating approval for mining magnate Gina Rinehart to bring in 1700 skilled foreign workers to get her $9.5 billion Roy Hill iron ore mine underway in the Pilbara (Farr, 2012).
The Gillard Government’s lack of political success also led it to look for political scapegoats. Notably, during 2012, Swan accused mining magnates Clive Palmer, Andrew Forrest and Gina Rinehart of trying to assert too much influence over Australian politics, given their strident opposition to the carbon tax and the mining tax (Swan, 2012). Similarly, Gillard, responding to another debate over the economics of education, suggesting that people who lived on Sydney's North Shore were not ‘real people’ (Nadin and Salusinszky, 2012). The Government also sought to counter perceived media bias, although it failed to win parliamentary support for its media law reform bill. Similarly, Gillard’s description of Abbott as ‘sexist and misogynist’ gave, at best, a temporary boost to Gillard’s approval ratings (Essential Report, Essential Research 15 October 2012).
The Absence of Policy
Marsh and McConnell’s framework focuses on policies which have been introduced to examine whether they have been successful. However, another issue is clearly important: what issues did the Gillard Government avoid, even where there appeared to be a need for policy changes?
In a sense, the most important are here again is economic policy. The Gillard Government gave little attention to how best to generate wealth or, even, as we saw earlier, to achieving a balanced budget. In this context, Johnson (2011a) claims that the Gillard Government was closer to the economic rationalism of Hawke and Keating, than to Rudd, given the latter had provided a critique of neo-liberalism. Certainly, the Gillard Government appeared happy to accept a growing reliance upon mining and services, while Australia’s manufacturing and agricultural sectors faced further relative decline, as export-exposed industries experienced much greater competition, given the rise in the Australian dollar.
Australia continued to benefit from mining and fuels (including coal), after the global export value of those sectors increased by 16% between 2000 and 2005 and 14% between 2005 and 2011, the latter occurring despite a decline of 39% in 2009 (WTO, 2012). However, with global manufacturing exports (non-food products) worth around 65% of total global merchandise exports, and still dwarfing global commercial service exports by a ratio of nearly 4.5 to 1, Australia was being asked to compete with the world’s developed nations for global trade exports. At the same time, the value of Australia’s food product imports increased by 371% between 2000 and 2011, while exports went up just 204% (WTO, 2012).
Of course, these growing economic problems, which, as Garnett and Lewis emphasise, resulted at least in part from Gillard Government policies, impacted on Gillard Government’s social policies, given the need to pay for them.
However, the Gillard Government failed to acknowledge, or even discuss, possible fiscal limitations in the future. All this meant that, while Labor was committed to maintaining the Coalition’s level of government expenditure as a percentage of GDP, the total level of social welfare expenditure reached a near record level of 18% of GDP in 2012 (OECDb). This was funded by deficit spending, at a time when, as we saw, budgetary forecasts proved wrong time and time again.
Of course, there was some attempt to balance the ledger. In this context, the Government’s social policy innovation (discussed by Singleton in Chapter Three) was often only enabled by controversial cuts and reforms in other policy areas. So, Labor increased means-testing of the private health insurance rebate after July 2012 (Deloitte 2011; ANOP 2011) and increase the Medicare levy to partially fund the National Disability Insurance Scheme. It also adopted a temporary flood levy to raise $1.8 billion from July 2011 after the devastating flood caused widespread damage to Queensland. However, at the same time, $2.5 billion was to be cut out of the university sector in the four years from 2013, while $520 million was raised by capping tax deductions for self-education expenses.
Some cuts particularly effected the more disadvantaged. So, around 84,000 sole parents were moved off parenting payments, when their youngest child turns eight, which meant 60,000 single parents moved on to Newstart from January 2013, with estimates that many would lose $60-100 a week - this policy even led to a damning letter from the UN (AAP 2013). In addition, the Newstart allowance (unemployment benefit) was frozen, meaning that the base rate had not increased in real terms since 1994, with even the Business Council of Australia President Tony Shepherd calling for an increase at a National Press Club address (Crook, 2013). However, the Gillard Government’s 2013 budget did allow welfare recipients to keep an extra $19 a week from part-time work before payments are affected.
Such policies hardly helped the 13% of Australians living below the poverty line, deemed by ACOSS to now be $358 per week for a single person and $573 per single parent, given Newstart weekly rates were $256.30 for a single person and $266.50 for a single parent, far less than the disability pension of $375 a week and the minimum wage of $590 (Crook, 2013).
The Gillard Government’s almost hopeful attitude to economic and social matters was critiqued by experts concerned about how future social welfare policies would be funded. In relation to health, a Grattan Institute report (April, 2013) predicted that health expenditure would be the biggest contributor to a blowout in State and Federal budget deficits by 2023, due primarily to an ageing population (Daley, 2013). Similarly, John Deeble, the health economist who advised both the Whitlam and Hawke Governments on universal healthcare (Medibank and Medicare), argued that the States were shouldering too much of the burden of health funding and that subsidising private health insurance could help to solve the problem, , as long as it became more ‘comprehensive and stayed comprehensive’. Deeble declared: ‘I don’t see how you are going to solve the problem in an equitable way unless you make some very nasty decisions” (Heath, 2013).
At the same time, the Chief Executive of one of Australia’s largest private health insurers (NIB), Mark Fitzgibbon, also argued that the level of public health expenditure was ‘impossible’ and that the private health system would have to be expanded to include GP visits, while supporting the introduction of means-testing, given the rollback of government support for private health was inevitable (Heath, 2013). Similarly, during May 2013, the AMA noted that financial pressures (wages and costs) on medical practices meant that the bulk billing rate for GP services was likely to fall after the Gillard Government’s decision to delay the indexation of the GP Medicare rebate (currently $36.30) by eight months, from November 2013 to July 2014 (AMA 2013).
In contrast to Australia, Canada, which is also faced with an ageing population, and where the bulk of healthcare spending is by Provincial Governments, slashed healthcare spending during the 1990s, in face of a public debt crisis. The argument here was that increased spending was a choice for governments, until they had no choice but to cut public spending (Keane, 2013). The point here is that the need to balance wealth creation and social welfare policies appeared largely lost on the Gillard Government, given its almost cavalier approach to economic matters.
Perhaps this is why new policies are emerging, albeit begun much earlier than the Gillard Government, which mask the real solutions through rhetorical aims based more on wishful thinking. For example, while the Government built upon the National Assessment Program – Literacy and Numeracy (NAPLAN), which, since 2008, has annually assessed students in Years 3, 5, 7 and 9, by launching a revamped My School website during March 2011, another report by the Grattan Institute stated that “neither creating more competition among schools nor giving them more autonomy without support to improve learning are the vital solutions” would “lift the performance of Australian students”. The Myth of Markets in School Education report noted a number of reasons: at least 40-60% of schools ‘face no or very limited competition’; ‘providing more information about schools, cutting private school fees or increasing the capacity of high-performing government schools will do little to increase school competition and lift student performance’; and giving school leaders autonomy to run their schools ‘has little impact on performance when governments do not implement it as part of a larger plan to improve teaching and learning’, a point strengthened by the fact that greater school autonomy in Victoria did not lead to greater performance than in NSW, which remained centralised until recently. As summarised by Jensen in a summary of his Grattan Institute Report The myth of markets in school education, the world’s best systems: ‘have varying levels of autonomy but they all articulate the best way to teach and learn, then make sure they have the best teachers to carry it out’ (Jensen, 2013).
The failure to even consider, let alone face up to, difficult issues is clear in the debates about climate change and population growth. As we saw, the Gillard Government answer to generating wealth in these difficult times, focused on more of the same, So, Australia exports pollution at the same time as cutting, admittedly in a limited way, its own greenhouse gas emissions, with no consideration of this apparent contradiction. Such contradictions are similarly present if we consider the population debate. While Gillard, rhetorically, re-positioned Labor away from Rudd’s original “Big Australia” population goal (Leslie, 2010), the Government maintained Australia's long-term support bi-partisan support for a large, multi-ethnic, annual immigration program. So, during the 2011-12 year, there were 184,998 legal migrants, including 125,755 for the skill stream and 58,604 for the family stream (Dept. of Immigration and Citizenship, 2012).
As earlier chapters also demonstrate, the Government’s economic and social policy record was mixed at best, even allowing for a tough international economic environment, with Australia continuing to embrace freer trade, the instability caused by a former leader (Rudd), determined to regain the prime ministership, and the reality of a minority government, which demanded a careful monitoring of numbers and support from controversial MPs. The Government’s inability to win over public opinion even led to the return of Rudd as Prime Minister, as caucus members feared a loss of their seats.
The Government was successful in achieving a legislative process success, with the support of the Greens and key independents. In particular, it achieved some significant changes in health and education (notably the NDIS), although this was at the cost of tougher conditions for a substantial minority of welfare recipients. Unfortunately, the policy areas in which it achieved process success will require time before any assessment can be made of programmatic success. However, in the areas in which there were significant process failures, notably in economic policy and on the carbon and mining taxes, programmatic and political failure quickly followed.
In the end, the Gillard Government did not do enough to convince a sufficient number of Australians of their policy success, despite Australia’s strong economic performance, when compared to other developed nations. Even allowing for the particularly difficult context in which the Government operated, it fail to implement an effective economic policy mix that could help win public support, at time when a growing minority faced tougher times, due to employment uncertainty, higher housing prices and, even, rapidly increasing utility bills.
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