Beware the veil of independence in government reviews

Business Council of Australia and now National Commission of Audit head Tony Shepherd is unlikely to make recommendations that don’t fit with the Coalition’s agenda. Nikki Short/AAP

The Abbott Coalition government, like the incoming Labor government before it, has marked the beginning of its term with a raft of reviews, including the wide ranging National Commission of Audit.

Given Tony Abbott’s criticism of Kevin Rudd outsourcing policy to inquiries and reviews and his own promise of “no surprises”, it is paradoxical that his government is outsourcing policy in the same way. This could mean delays in implementing, or even developing, policy and lots of surprises.

The public inquiries list is long. The National Commission of Audit, the Financial System Inquiry, the review of competition policy and the various inquiries into the National Broadband Network have had the most publicity. There are also eight Productivity Commission inquiries and more than 30 others that have been announced but not necessarily commenced.

The terms of reference of the National Commission of Audit instruct it to examine all the Commonwealth government’s activities and expenditure, although Treasurer Joe Hockey has committed to not cutting the health, education and defence budgets.

One of the reasons governments often give for appointing public inquiries is that they are independent bodies with members who are disinterested experts. As a result their advice can be trusted. This is a popular idea.

For example in 2012 when a Victorian parliamentary committee, the Family and Community Development Committee, embarked on an inquiry into the handling of child abuse by religious and other organisations, both the media and individuals criticised it on the grounds that a parliamentary committee was not competent to run such an inquiry.

This is a common view; in the face of disasters and scandals a royal commission is the only body deemed able to handle an inquiry.

Transparency is another argument for appointing public inquiries. They often invite public submissions and their reports are publicly available. Yet in the digital age reports can easily vanish. Twenty years ago reports, printed by the Government Printer, were usually tabled in parliament. This meant they were accessible, even if they took some hunting down.

The disappearance of the Gonski Report from Commonwealth Department of Education website is not unusual now that reports are digitised and available on websites rather than libraries and bookshops; they can easily vanish when a government department updates its website.

Who are the reviewers?

Who appoints the members of inquiries, reviews and royal commissions? Obviously it’s the government and, usually, governments appoint members who share their world view. Audit commissions are a good example.

Since 1988 there have been 14 appointed by state, territory and Commonwealth governments.

“Living within your means” was the theme of both the first one, appointed in 1988 by New South Wales premier Nick Greiner, and others, including the 2013 National Commission of Audit. The governments that appointed them have pointed to levels of debt and the expenses of government as their motivation. Most have blamed a previous ALP government for waste and incompetence.

The commissioners of the first round, between 1988 and 1996 came mostly from a business background and the governments appointing them emphasised that their expertise and experience made them the right people to investigate making the public sector more like the private sector. In 1988 this was a fairly radical idea, although public sector reforms with this aim were well on the way in the UK and New Zealand. Concepts variously described as neo liberalism, economic rationalism or new public management were overtaking traditional views of public administration.

When a second round commenced in 2008 the measures pursued by the earlier audit commissions were already in place. The public sector had changed dramatically. Now the members of the commission were equally likely to be current or retired public servants who had themselves been part of the process that changed the public sector.

Former Howard government minister Amanda Vanstone now sits on the Commission of Audit panel. Mick Tsikas/AAP

The National Commission of Audit’s five commissioners reflect the current model. The chair, Tony Shepherd, is the President of the Business Council of Australia, and argued for the appointment of an audit commission before the election. The other four members are Peter Boxall, formerly Secretary of the Department of Finance and Administration and chief of staff to Peter Costello, Tony Cole, former Treasury Secretary, Robert Fisher, formerly a senior public servant in Western Australia and Amanda Vanstone, a former senator and Howard Government minister between 1996 and 2007.

The commissioners are unlikely to make recommendations that are out of line with the Coalition’s ideology. The same applies to other government reviews.

The minister for education, Christopher Pyne, has appointed David Kemp and Andrew Norton to undertake a review into the demand-driven funding system for universities. Kemp was minister for education in the Howard government and Norton was his adviser on higher education policy.

When Malcolm Turnbull, the minister for communications, appointed a panel of experts to conduct cost-benefit analysis of broadband and review NBN regulation, one of the four members was Henry Ergas, already a critic of the ALP version of the NBN. The chair is Michael Vertigan who had chaired the Independent Review of State Finances appointed by Victorian premier Ted Baillieu to review Victorian government finances in 2011. These appointees, while well-qualified, are unlikely to come up with unpleasant surprises. The ministers who appointed them can expect a competent job within the parameters of Coalition policy.

This does not mean that recommendations will always be implemented. Politicians need to think about politics and sometimes the numbers trump ideology. We need look no further than Joe Hockey’s decision not to allow the takeover of GrainCorp for a current example.

Do reviews genuinely inform public policy?

Outsourcing policy development to audit commissions in particular can be simply a way not to stick with campaign promises. “Oh yes, we promised we would, but then we found out how things really are…”. They look independent but, depending on their terms of reference and attitudes of members, can be relied on not to make radical recommendations.

Governments may also appoint them to use expertise not available in the public service. Whether technical and economic advice actually informs decision-making may be revealed by the government’s response to the strategic review of the NBN.

Government reviews can inform government policy but we shouldn’t expect them to change it.

Despite a common belief that the two major parties are indistinguishable, each maintains an ideological position that underlies its policies. And they are not going to change because of a review’s recommendations.

The pragmatic approach is to appoint members who broadly support the government’s ideological position and wait for them to report on how to implement it.

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