tag:theconversation.com,2011:/global/topics/securing-australias-future-8217/articlesSecuring Australia's future – The Conversation2013-12-18T19:12:25Ztag:theconversation.com,2011:article/196062013-12-18T19:12:25Z2013-12-18T19:12:25ZSecuring Australia’s future: education<figure><img src="https://images.theconversation.com/files/36495/original/gjycqhj9-1385690701.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Education is well financed in Australia but a number of inefficiencies need to be addressed.</span> <span class="attribution"><span class="source">AAP Image/Julian Smith</span></span></figcaption></figure><p><em>SECURING AUSTRALIA’S FUTURE: As the Commission of Audit reviews government activity and spending, The Conversation’s experts take a closer look at key policy areas tied to this funding – what’s working, what’s not and where current funds are best spent.</em></p>
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<p>Broadly speaking, education in Australia has been well-financed over the past decade. </p>
<p>Sure, there are issues about particular programs and the efficiency with which funds have been used. But the injection of billions of dollars into school facilities through the “building revolution” and the steady increase in annual per-student recurrent funding has ensured all students have the opportunity to achieve <a href="http://www.nap.edu.au/naplan/naplan.html">minimum numeracy and literacy targets</a> or graduation standards. </p>
<p>The <a href="http://studyassist.gov.au/sites/studyassist/helppayingmyfees/hecs-help">HECS program</a> has also given countless students the opportunity to access and pursue higher education.</p>
<p>But there are a number of inefficiencies that need to be addressed.</p>
<h2>Waste and inefficiency</h2>
<p>Recent trends to <a href="https://theconversation.com/factcheck-are-the-gonski-school-reforms-a-federal-power-grab-15458">centralise the management of schooling</a> at the Commonwealth level are likely to lead to inefficiencies and duplication. Being remote from the actual situation may also increase the risk of poor decisions being made at the central level. </p>
<p>The Commonwealth only needs to co-ordinate funding allocations to the states, based on their performance evidence submissions. Adhering to this principle would reduce duplication of costs. The government has already indicated that central command will not occur, but it still needs to annually monitor performance at the state and sector levels.</p>
<p>It’s also important not to forget that the priority role of government in education is to assist the least advantaged. This means ensuring funds are available to purchase adequate resources for attaining minimum measurable performance outcomes. </p>
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<img alt="" src="https://images.theconversation.com/files/36501/original/qbyqh34w-1385695355.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/36501/original/qbyqh34w-1385695355.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=896&fit=crop&dpr=1 600w, https://images.theconversation.com/files/36501/original/qbyqh34w-1385695355.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=896&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/36501/original/qbyqh34w-1385695355.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=896&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/36501/original/qbyqh34w-1385695355.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1126&fit=crop&dpr=1 754w, https://images.theconversation.com/files/36501/original/qbyqh34w-1385695355.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1126&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/36501/original/qbyqh34w-1385695355.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1126&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">How do we know when a child has reached her potential?</span>
<span class="attribution"><span class="source">AAP/Dan Peled</span></span>
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<p>But recently, the objective of equal opportunity to reach one’s potential has been promoted – but what is “potential”? And how do we know when it has been achieved? Adequate resourcing to achieve clear performance standards should be the objective of government funding.</p>
<p>The Commission of Audit must examine the funding of senior secondary programs, which provide the bridge between standard compulsory schooling and further study or employment. </p>
<p>This is a crucial time for teenagers. But in some states, these senior years are not very well coordinated with schools, TAFEs, and registered training authorities (RTOs) providing similar programs and students moving across institutions without any tracking or support. The Gonski review ignored senior secondary schooling.</p>
<p>The programs available need to be coordinated and their overall places need to match forecasts of skill need. With the prospect of rising teenage unemployment, together with falling labour productivity, a major rationalisation of senior secondary programs is <a href="https://theconversation.com/coag-education-reports-show-early-childhood-and-year-12-are-key-19611">urgently needed</a>.</p>
<p>Finally, the fact that many schools offering senior secondary programs operate below capacity – with enrolments spread thinly over programs and schools – warrants investigation. </p>
<p>Sizable economies of scale may be obtained by allowing senior secondary components of schools to grow with increases in student numbers. Other options are to amalgamate existing providers or incorporating vocational education and training (VET) Certificate programs at senior schools.</p>
<h2>Strategic cuts</h2>
<p>The role of the government, on behalf of society, is to provide services that markets cannot and to assist the least advantaged. In carrying out this role, the principle of subsidiarity should apply, whereby management and operational decisions are made by those nearest to the action.</p>
<p>All teenagers should have an equal opportunity to attain a senior secondary school certificate or equivalent, and thereby acquire the minimum basic competencies necessary for effective lifelong participation in society. And all school-leavers should have an equal opportunity to access, participate and graduate from a higher education program.</p>
<p>Without surrendering these principles, cuts to government spending on education could come from the following actions. </p>
<p>First, scale back services to coordination and planning essentially. Adopt the principle of subsidiarity and avoid trying to micro-manage education institutions, which is best left to the local people involved (state governments, regional and sector authorities and schools). </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/36502/original/jvwyrkj4-1385696190.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/36502/original/jvwyrkj4-1385696190.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=357&fit=crop&dpr=1 600w, https://images.theconversation.com/files/36502/original/jvwyrkj4-1385696190.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=357&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/36502/original/jvwyrkj4-1385696190.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=357&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/36502/original/jvwyrkj4-1385696190.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=448&fit=crop&dpr=1 754w, https://images.theconversation.com/files/36502/original/jvwyrkj4-1385696190.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=448&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/36502/original/jvwyrkj4-1385696190.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=448&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Secondary school is a crucial time for students and must be coordinated effectively.</span>
<span class="attribution"><span class="source">AAP/Julian Smith</span></span>
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<p>Secondly, the government needs to consider a new model of longer-term school funding that’s based on short-term performance gains. </p>
<p>More money has hardly changed performance over the last decade. School funding <a href="https://newmatilda.com//2013/12/04/pynes-education-numbers-dont-add">has risen by at least 14%</a> over the past ten years. But in that time our international performance has declined. One-third of 15-year olds <a href="https://theconversation.com/new-pisa-results-show-education-decline-its-time-to-stop-the-slide-21054">aren’t meeting national literacy standards</a> and in less than a decade, Australian school students’ performance in maths <a href="https://theconversation.com/new-pisa-results-show-education-decline-its-time-to-stop-the-slide-21054">has declined</a> by the equivalent of half a year of schooling.</p>
<p>Simply handing out billions more for the purchase of unknown resources and based on a suspect method and political negotiation cannot be expected to provide performance improvements in the future. </p>
<p>The focus is now on the current government to come up with a fair school funding model, based on real resources such as the student-teacher ratio and not on school spending, which can include many different types and levels of spending. Such a focus may find that each sector has sufficient funding to purchase adequate resources for all its schools, but that the distribution of funding within each sector is not appropriate. </p>
<p>In future, additional funds should cover the expected enrolment growth and improved management practices at poor performing schools.</p>
<h2>Areas of priority</h2>
<p>The Commission of Audit should recommend placing VET Certificates I, II and III under the watch of state bodies regulating schools. In this way, all senior secondary programs or equivalent will be coordinated by one state body which can consolidate and rationalise senior secondary programs wherever they are provided. </p>
<p>This will facilitate a more equitable distribution of funds across all teenage students as well as ensuring support services are still available for students if they transfer to non-school providers.</p>
<p>The Commission of Audit should consider how to get the sectors to redistribute recurrent funding among schools within each jurisdiction. Currently, schools with similar enrolments, similar student socioeconomic backgrounds and similar resourcing perform vastly different. There is sufficient funding for all schools to achieve minimum standards, but the funds are not equitably distributed within sectors. </p>
<p>State departments should be scaled back to be coordinators of autonomous regional groups of schools and planners of development. Along the same reasoning as for the Commonwealth, state departments should focus on coordination and leave the micro-management of schools to the local participants. </p>
<p>Regions should submit performance reports in order to acquire funding from the state which in turn collates the evidence and submits the state funding application to the Commonwealth.</p>
<p>Finally, the Commission of Audit should recommend allocating more research funding to projects related to forecasting future employment skill needs and the planning of how these skills are to be obtained. Use this information to inform planning at state level.</p>
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<p><em>This is part five of The Conversation’s Securing Australia’s future series.</em></p>
<p><em>Part one: <a href="https://theconversation.com/securing-australias-future-energy-and-climate-change-19691">Energy and climate change</a></em></p>
<p><em>Part two: <a href="https://theconversation.com/securing-australias-future-governance-and-state-federal-relations-19903">Governance and state-federal relations</a></em></p>
<p><em>Part three: <a href="https://theconversation.com/securing-australias-future-science-and-research-19516">Science and research</a></em></p>
<p><em>Part four: <a href="https://theconversation.com/securing-australias-future-health-care-19765">Health care</a></em></p><img src="https://counter.theconversation.com/content/19606/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Kevin Gould does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>SECURING AUSTRALIA’S FUTURE: As the Commission of Audit reviews government activity and spending, The Conversation’s experts take a closer look at key policy areas tied to this funding – what’s working…Kevin Gould, Researcher in Economics of Education, CQUniversity AustraliaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/197652013-12-15T19:11:24Z2013-12-15T19:11:24ZSecuring Australia’s future: health care<figure><img src="https://images.theconversation.com/files/37635/original/tdvfpvv8-1386891917.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Governments setting out to control spending, or move it in more efficient directions, must have strong backbones.</span> <span class="attribution"><span class="source">AAP Image/David Crosling</span></span></figcaption></figure><p><em>SECURING AUSTRALIA’S FUTURE: As the Commission of Audit reviews government activity and spending, The Conversation’s experts take a closer look at key policy areas tied to this funding – what’s working, what’s not and where current funds are best spent.</em></p>
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<p>Most measures of Australian health outcomes show a system that delivers – especially compared with other developed countries. Life expectancy, deaths from cancer and heart attacks, rates of smoking have all improved dramatically over the past few decades. </p>
<p>But obesity, physical activity and other factors that will shape future health look less rosy. And the gap in Indigenous health remains glaring.</p>
<p>The link between positive factors and spending on health is problematic: the drop in smoking stems from “nanny state” regulation; others, such as improved survival rates with heart disease, are more clearly linked to new medicines or clinical innovations.</p>
<p>Government and private <a href="http://www.aihw.gov.au/WorkArea/DownloadAsset.aspx?id=60129544656">spending on health</a> has been rapidly rising. We now spend more than A$140 billion (2011), up from A$82 billion ten years earlier (adjusted for inflation). Put as a proportion of the entire economy, the increase looks a little more modest: health spending went from 8.4% to 9.5%, around the OECD average. </p>
<p>At the same time, this increase has drawn unequally on three sources: the federal government, the states and private households. Canberra’s contribution to the cost of hospitals actually fell over the decade, while the burden borne by the states has risen.</p>
<p>A <a href="https://www.mja.com.au/journal/2013/199/7/can-t-escape-it-out-pocket-cost-health-care-australia?0=ip_login_no_cache%3Db0f6362d1cc2c598141cd229f98be008">recent study</a> found that almost a quarter of the costs of health care come out of the pockets of Australian households. The cost of medicines was the largest budget item for older households; private health insurance premiums the biggest cost for the younger. </p>
<p>Consequently, talk about Canberra “cutting” health expenditure needs to be greeted with some scepticism. Is the federal government merely shifting costs to the states and private households; clearing its own balance sheet? Much of the history of health policy since the 1970s has seen this type of cost shifting.</p>
<h2>Waste and inefficiency</h2>
<p>The central problem in Australian health finance – and policy innovation – always comes back to the divided responsibilities of federal and state governments. The states have too many costs and few financial resources of their own. And Canberra’s responsibility for paying for medical services through Medicare perpetuates silos between key parts of the health system.</p>
<p>The Council of Australian Governments (COAG) health reform process, which ran from 2008 to 2012, tried to end this blame game of cost shifting. It marked some real achievements, especially around making hospital expenditure more transparent. </p>
<p><a href="http://www.ihpa.gov.au/internet/ihpa/publishing.nsf/Content/funding">Activity-based funding</a> (ABF) – paying hospitals a standard price for the services they deliver – established incentives for greater efficiency. ABF also promised to gradually increase the Commonwealth share of hospital funding.</p>
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<img alt="" src="https://images.theconversation.com/files/37637/original/ynvw8f66-1386892147.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/37637/original/ynvw8f66-1386892147.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=347&fit=crop&dpr=1 600w, https://images.theconversation.com/files/37637/original/ynvw8f66-1386892147.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=347&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/37637/original/ynvw8f66-1386892147.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=347&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/37637/original/ynvw8f66-1386892147.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=436&fit=crop&dpr=1 754w, https://images.theconversation.com/files/37637/original/ynvw8f66-1386892147.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=436&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/37637/original/ynvw8f66-1386892147.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=436&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Australia spends 9.5% of its GDP on health, which is around the OECD average.</span>
<span class="attribution"><span class="source">Image from shutterstock.com</span></span>
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<p>However, the COAG reforms became focused on the hospitals. The key performance measures were hospital-based: elective surgery queues and emergency waiting times. A <a href="http://www.coagreformcouncil.gov.au/sites/default/files/files/DAE-CRC-COAG%20Reform%20Progress%20Report-FINAL%2006Nov13.pdf">recent review</a> for the COAG Reform Council confirmed that:</p>
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<p>most effort has been directed at the hospital system, with little attention to the integration of care necessary across the whole of the health system.</p>
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<p>The biggest gains in efficiency – and improved outcomes for consumers – lie in improving the ability of different parts of health to communicate seamlessly.</p>
<h2>Strategic cuts</h2>
<p>The largest part (about three-fifths) of Commonwealth expenditure pays for the pharmaceutical benefits scheme and payments for medical services under the <a href="http://www.mbsonline.gov.au/">Medicare Benefits Schedule</a> (MBS). These are the areas under its direct control. This spending is the least entangled in complicated agreements with the states.</p>
<p>The previous government made large inroads into the costs of pharmaceuticals. A recent Committee for the Economic Development of Australia <a href="http://www.ceda.com.au/media/302619/healthcarefinal1.pdf">report</a> has pointed to further major savings if federal governments were to bargain harder over the prices of generic (off-patent) drugs.</p>
<p>The <a href="grattan.edu.au/static/files/assets/003db14b/803-Poor-Pricing-Progress.pdf">Grattan Institute</a> has estimated savings of more than A$1 billion from better pricing policies. It advocates an independent pricing authority, on the model of the <a href="http://www.health.gov.au/internet/main/publishing.nsf/Content/Pharmaceutical+Benefits+Advisory+Committee-1">Pharmaceutical Benefits Advisory Committee</a>, which has successfully held down the prices of new, patented medicines.</p>
<p>The MBS is a different matter. While new benefits now undergo economic evaluation for cost effectiveness before approval, there is little scrutiny of existing benefits in the light of new evidence on efficacy and safety. Rebates set at a high level often remain long after changes in medical technology have cut costs. </p>
<p>Here we are moving into a politically difficult terrain. One person’s waste is another’s income. Efficiency cuts can lead to ferocious opposition, as Labor found when it <a href="http://blogs.crikey.com.au/croakey/2009/08/26/stop-exploiting-us-consumers-tell-ophthalmologists/">cut rebates for ophthalmology</a> which had not kept pace with technological change. </p>
<p>A more rigorous scrutiny of the MBS – involving the professional organisations rather than sudden coups from Canberra – is a recipe for a slow haul. It would require considerable political skill and courage. The dividend would be in more efficient, safer medical practice.</p>
<h2>Areas of priority</h2>
<p>Two areas of the health system are seriously misaligned.</p>
<p>Prevention – with the greatest hope of long-term savings – remains neglected. Lifestyle-related chronic illnesses, such as diabetes, provide the fastest growing burden on the health system.</p>
<p>The <a href="http://www.bca.com.au/policy-agenda/healthy-australia">Business Council of Australia</a> has warned:</p>
<blockquote>
<p>There is little evidence that the preventative health and health care agendas will be brought together, and despite major new public health programs being announced, the balance of resources allocated to prevention (at just over 2% of total public health expenditure) continues to be dwarfed by the resources allocated to curative care. </p>
<p>Similarly, incentives for individuals to take greater responsibility for maintaining their health remain little changed.</p>
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<img alt="" src="https://images.theconversation.com/files/37638/original/jgvxfq3k-1386892239.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/37638/original/jgvxfq3k-1386892239.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/37638/original/jgvxfq3k-1386892239.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/37638/original/jgvxfq3k-1386892239.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/37638/original/jgvxfq3k-1386892239.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/37638/original/jgvxfq3k-1386892239.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/37638/original/jgvxfq3k-1386892239.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Investing in preventative care delivers saving later on.</span>
<span class="attribution"><span class="source">Image from shutterstock.com</span></span>
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</figure>
<p>Second, the consumer experience is of a confusing and fragmented system. The split between hospital and primary health care funding creates barriers to cooperation and communication between health-care providers.</p>
<p>Disability and aged care services are pioneering <a href="https://theconversation.com/we-have-an-ndis-but-what-does-this-mean-for-disability-care-13112">new models of funding</a> following the consumer. Health services have done little to follow this patient-focused model. Greater investment in attempts to bridge the system – such as the new <a href="https://theconversation.com/everything-you-need-to-know-about-your-medicare-local-but-didnt-know-who-to-ask-851">Medicare Locals</a>, which bring together primary health care services within the same boundaries as the hospitals – offer a productive way forward.</p>
<h2>How likely is this to happen?</h2>
<p>The greatest gains in health have come from improved prevention. The current signs in this area are not encouraging, with <a href="blogs.crikey.com.au/croakey/2013/12/05/">rumoured or announced plans</a> to axe the <a href="http://anpha.gov.au/internet/anpha/publishing.nsf">Australian National Preventive Health Agency</a> and withdrawal of funding to the <a href="http://www.smh.com.au/federal-politics/political-news/alcohol-and-other-drugs-council-of-australia-in-administration-after-tony-abbott-cuts-20131126-2y836.html">Alcohol and Other Drugs Council</a>.</p>
<p>There is also a looming threat to the future of the Medicare Locals. They face a secretive review that threatens to cut funding and restrict their work to support services for GPs.</p>
<p>Every cut – or shift – in expenditure on health does not just affect patients. It also reduces the incomes of providers, whether doctors or pharmaceutical companies. </p>
<p>Governments setting out to control spending, or move it in more efficient directions, must have strong backbones.</p>
<hr>
<p><em>This is part four of The Conversation’s Securing Australia’s future series. Stay tuned for more instalments over the next three weeks.</em></p>
<p><em>Part one: <a href="https://theconversation.com/securing-australias-future-energy-and-climate-change-19691">Energy and climate change</a></em></p>
<p><em>Part two: <a href="https://theconversation.com/securing-australias-future-governance-and-state-federal-relations-19903">Governance and state-federal relations</a></em></p>
<p><em>Part three: <a href="https://theconversation.com/securing-australias-future-science-and-research-19516">Science and research</a></em></p>
<p><em>Part five: <a href="https://theconversation.com/securing-australias-future-education-19606">Education</a></em></p><img src="https://counter.theconversation.com/content/19765/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Jim Gillespie receives funding from the National Health and Medical Research Council to research coordination of care between hospitals and community and from WentWest (Western Sydney Medicare Local) to evaluate the Western Sydney Partners in Recovery (mental health care) Program.</span></em></p>SECURING AUSTRALIA’S FUTURE: As the Commission of Audit reviews government activity and spending, The Conversation’s experts take a closer look at key policy areas tied to this funding – what’s working…Jim Gillespie, Deputy Director, Menzies Centre for Health Policy & Associate Professor in Health Policy, University of SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/195162013-12-09T03:19:09Z2013-12-09T03:19:09ZSecuring Australia’s future: science and research<figure><img src="https://images.theconversation.com/files/37161/original/sgfygv2h-1386418988.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">What does the future hold for research funding under an Abbott government?</span> <span class="attribution"><span class="source">AAP/David Crosling</span></span></figcaption></figure><p><em>SECURING AUSTRALIA’S FUTURE: As the Commission of Audit reviews government activity and spending, The Conversation’s experts take a closer look at key policy areas tied to this funding – what’s working, what’s not and where current funds are best spent.</em></p>
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<p>According to <a href="http://www.chiefscientist.gov.au/2011/06/professor-ian-chubbs-address-to-the-national-press-club/">Chief Scientist Ian Chubb</a>, in the first half of the 20th century Australia was a “mendicant nation” for science and research where:</p>
<blockquote>
<p>…we contributed little to the world’s stock of knowledge but we hoped to get what we needed when or whenever we needed it. </p>
</blockquote>
<p>Today, through long-term government backing of Australian science, a vibrant, world-class research culture has emerged, producing a string of breakthroughs in diverse fields from cancer to solar cells to Wi-Fi.</p>
<p>Just one example of excellence is in quantum computing. A group from <a href="https://newsroom.unsw.edu.au/news/technology/breakthrough-bid-create-first-quantum-computer">UNSW</a> has developed the world’s first working quantum bit. These types of breakthroughs will profoundly shape not only Australia’s future prosperity, but also the world’s.</p>
<p>Despite the importance of innovation in the years ahead, government expenditure on science and research as a proportion of GDP has fallen by <a href="http://www.innovation.gov.au/innovation/policy/Documents/NISChapter06.pdf">more than a quarter since 1993</a>, with current public expenditure (~0.55% of GDP) putting Australia <a href="http://www.innovation.gov.au/innovation/policy/Documents/NISChapter06.pdf">near the bottom of the 22 advanced nations</a>.</p>
<p>With the new Abbott government looking for budget savings in a tight fiscal situation, we should take the view of Ernest Rutherford, Nobel Prize-winning physicist. When hearing the news that Cambridge University was going to stop funding his research in the early 1900s, Rutherford supposedly walked into his lab and said:</p>
<blockquote>
<p>Gentlemen, we have run out of money. It’s time to start thinking.</p>
</blockquote>
<p>Science and research is too important for all of us to stop thinking about how we can make it as productive to future discovery and innovation as it can be, no matter what funding environment or government is in place.</p>
<h2>What’s working</h2>
<p>The old idea of a “brain drain” where scientists had to leave Australia to find quality labs overseas has dissipated. Australian research is now world-class and salaries – particularly for young PhD graduates – are the best in the world. In the US, for example, average post-doctoral research salaries are about <a href="http://www.newscientist.com/article/dn23512-postdoc-payday-salaries-for-fellows-are-on-the-up.html#.Uo2js0LBfzJ">US$40,000</a>. In Australia, the average starting salary from most universities is about A$75,000.</p>
<p>Research excellence, along with world-best salaries, means Australia is in fact having a big “brain gain” for the world’s most brilliant younger minds. In 2013, young foreign national scientists applying to the Australian Research Council early career fellowships (Discovery Early Career Researcher Awards, or <a href="http://www.arc.gov.au/ncgp/decra.htm">DECRA</a>) have increased to be <a href="http://www.arc.gov.au/pdf/DECRA14/DE1_%20Selection_Report.pdf">35% of all applicants</a>.</p>
<p>Australia has successfully started to become a magnet for brilliant young researchers around the world. With high mobility, immense creativity and high productivity, those early career researchers are the engines of future prosperity. Australia should embrace them. </p>
<p>But the success in creating the conditions for young scientists to be attracted to Australia comes with big challenges. For the vast majority of them, we can’t find funding.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/37186/original/z5ydf9m5-1386546624.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/37186/original/z5ydf9m5-1386546624.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=399&fit=crop&dpr=1 600w, https://images.theconversation.com/files/37186/original/z5ydf9m5-1386546624.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=399&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/37186/original/z5ydf9m5-1386546624.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=399&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/37186/original/z5ydf9m5-1386546624.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=502&fit=crop&dpr=1 754w, https://images.theconversation.com/files/37186/original/z5ydf9m5-1386546624.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=502&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/37186/original/z5ydf9m5-1386546624.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=502&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Australian research is now world-class and salaries are among the best in the world.</span>
<span class="attribution"><span class="source">AAP/Lukas Coch</span></span>
</figcaption>
</figure>
<h2>Waste and inefficiency</h2>
<p>Each year, thousands of proposals are sent to the funding bodies, which then commission expert reviewers and panellists to award grants and fellowships of between three and five years to researchers at universities and medical institutes across the country.</p>
<p>There is waste that occurs every year within this competitive system of funding. Over the last few years, success rates for grants are about 20-25%. A recent <a href="http://www.nature.com/nature/journal/v495/n7441/full/495314d.html">study</a> calculated a total waste of 550 working years of research time applying for unsuccessful grants just in the NHMRC, equivalent to $66 million in salary. </p>
<p>The NHMRC, at least, is <a href="http://www.theaustralian.com.au/higher-education/rolling-rounds-to-speed-research-funds/story-e6frgcjx-1226753737004#mm-premium">considering</a> halving the paperwork and lengthening funding terms to help reduce this hidden inefficiency.</p>
<p>But the waste that occurs through the grants system is insignificant compared to the immense long-term waste and missed opportunity of losing a high-quality young researcher who may have the next idea to cure cancer. The hidden bias against younger researchers in the competitive, peer-reviewed funding schemes is immense and at a crisis point.</p>
<p>Critiquing the current grants system, Nobel Laureate <a href="http://www.theaustralian.com.au/higher-education/opinion/we-must-rebuild-our-grants-system/story-e6frgcko-1226516110682#mm-premium">Brian Schmidt</a> noted:</p>
<blockquote>
<p>People with track records, such as myself, are almost always successful. </p>
</blockquote>
<p>The psychological bias towards rewarding established and experienced researchers means that younger inexperienced scientists are the ones left out.</p>
<p>According to <a href="http://royalsociety.org/policy/publications/2010/scientific-century/">UK Royal Society research</a>, about 30% of the thousands who graduate with PhDs continue in research after their studies. However, after the first five to ten years of their PhD, only about 10% will end up staying in research permanently. The 90% opt-out rate is not a choice: it’s mostly a problem in the system.</p>
<p>Young researchers live in completely uncertain times, without the luxury of secure tenured employment from a university or research institution. Living month-to-month and applying for short-term, post-doctoral positions wherever they are, the first ten years after a PhD is the exit point for talented, creative and productive researchers in the system. </p>
<p>Losing a young researcher is the number one biggest long-term waste for taxpayers. Why?</p>
<p>It’s not just generational continuity of research or that we spend huge amounts of dollars and time training PhD candidates at publicly funded institutions. In fact, it’s also because this young demographic is when a scientist is most creative and productive.</p>
<p>The vast majority of the greatest discoveries in science, whether it was DNA or E=mc<sup>2,</sup> have come from younger researchers. Instead of developing the next clean technology, sequencing a new genome or probing stem cell regeneration in the brain, insecure employment means most of those talented researchers are lost to securely paid service industries.</p>
<p>Some choose to take this pathway. However, there are thousands of talented young scientists who want to stay in research but have to leave. This is an immense waste. Allowing these immensely innovative and passionate young scientists to fall through the cracks is a waste of taxpayer funds today and for the future.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/37187/original/zvpj3p2k-1386546711.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/37187/original/zvpj3p2k-1386546711.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=399&fit=crop&dpr=1 600w, https://images.theconversation.com/files/37187/original/zvpj3p2k-1386546711.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=399&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/37187/original/zvpj3p2k-1386546711.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=399&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/37187/original/zvpj3p2k-1386546711.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=502&fit=crop&dpr=1 754w, https://images.theconversation.com/files/37187/original/zvpj3p2k-1386546711.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=502&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/37187/original/zvpj3p2k-1386546711.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=502&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">There are thousands of talented young scientists who want to stay in research but have to leave, citing funding issues.</span>
<span class="attribution"><span class="source">AAP/Julian Smith</span></span>
</figcaption>
</figure>
<h2>Area of priority: early career researchers</h2>
<p>Early career scientists have very limited options for support since they can’t apply directly to the general pool of projects and grants at the ARC or NHMRC.</p>
<p>Early career fellowship schemes are the only avenue for young scientists to receive independence and certainty over four years. Since 2011, some 4908 proposals have been considered with 677 being awarded, with success rates of just 13.7%. These early career fellowship success rates are the lowest in the system. </p>
<p>Beyond that, it’s important to realise that the near 90% of unsuccessful applicants don’t have any funding security or the tenure that provides security to other mid-to-senior researchers. A large proportion of those high-quality applicants will leave science altogether, meaning Australia is materially losing the knowledge and innovation rewards that come with highly productive and gifted young researchers. </p>
<p>The longer we can keep early career researchers in labs, the better for innovative productivity.</p>
<p>So, where could the ARC and NHMRC make cuts to provide a big boost to early career researchers?</p>
<p>The ARC and NHMRC currently award a number of mid-to-senior fellowships to researchers at universities and research institutes. Depending on the individual agreement between fellowship applicant and university, many of these fellowships fund salaries that are already paid by universities, as many are tenured academics. This type of salary subsidisation scheme is not the most productive use of funds for research.</p>
<p>Between 2008-2013, for example the government funded $239 million for about 75 <a href="http://www.arc.gov.au/ncgp/laureate/laureate_default.htm">ARC Laureate Fellowships</a>, which are five years of funding to the most distinguished researchers. But more than a quarter of this funding supplements or replaces salaries in the hope of attracting world-leading researchers from overseas to Australia. </p>
<p>These were worthy goals. But of the 66 Laureate Fellows that have been awarded, 85% of them (55) were domestic professors, with tenured salary already secured at their respective universities.</p>
<p>Mobility for senior researchers is very low, particularly when they are already well-supported at their institutions anyway. Instead of the ARC and NHMRC spending tens of millions subsidising domestic professor salaries, wouldn’t it be far more productive to use those funds to attract and retain the most vulnerable early to mid-career researchers from both Australia and overseas?</p>
<p>Most of the senior fellowship schemes have this inefficient salary subsidisation scheme. Therefore, there is the potential to unlock tens of millions of dollars each year to be re-allocated to boost both the success rates for the early career researcher fellowships and the general pool of projects in the competitive granting schemes, which also indirectly support vulnerable early to mid-career researchers.</p>
<p>As William Bennett, a postdoctoral researcher at Griffith University, <a href="http://theconversation.com/we-want-to-work-but-research-funding-cuts-will-hobble-us-11719">eloquently put it</a>:</p>
<blockquote>
<p>We’re not asking for a salary increase, or more holidays, or less working hours. We’re not asking to be handed a career on a silver platter. We’re just asking for better than a 14% chance at a research career. We have so much to give, but limited opportunity to do so. Give us the chance, and we won’t let you down.</p>
</blockquote>
<p>Young scientists have never let any nation down. It’s the system of funding that generally does.</p>
<hr>
<p><em>This is part three of The Conversation’s Securing Australia’s future series. Stay tuned for more instalments over the next three weeks.</em></p>
<p><em>Part one: <a href="https://theconversation.com/securing-australias-future-energy-and-climate-change-19691">Energy and climate change</a></em></p>
<p><em>Part two: <a href="https://theconversation.com/securing-australias-future-governance-and-state-federal-relations-19903">Governance and state-federal relations</a></em></p>
<p><em>Part four: <a href="https://theconversation.com/securing-australias-future-health-care-19765">Health care</a></em></p>
<p><em>Part five: <a href="https://theconversation.com/securing-australias-future-education-19606">Education</a></em></p><img src="https://counter.theconversation.com/content/19516/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ben McNeil is affiliated with thinkable.org, but currently doesn't receive any funding from that organisation.</span></em></p>SECURING AUSTRALIA’S FUTURE: As the Commission of Audit reviews government activity and spending, The Conversation’s experts take a closer look at key policy areas tied to this funding – what’s working…Ben McNeil, Senior Research Fellow, UNSW SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/199032013-12-04T03:02:00Z2013-12-04T03:02:00ZSecuring Australia’s future: governance and state-federal relations<figure><img src="https://images.theconversation.com/files/36419/original/576fm73y-1385616192.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">What is a meaningful role for the Commonwealth government in the early 21st century?</span> <span class="attribution"><span class="source">AAP Image/Paul Miller</span></span></figcaption></figure><p><em>SECURING AUSTRALIA’S FUTURE: As the Commission of Audit reviews government activity and spending, The Conversation’s experts take a closer look at key policy areas tied to this funding – what’s working, what’s not and where current funds are best spent.</em></p>
<hr>
<p>The Commission of Audit’s brief to assess the split of roles and responsibilities between the Commonwealth and the states and territories is the first indication of the Abbott government’s commitment to undertake radical reform in this area. </p>
<p>The commissioners have been given the job of identifying areas of unnecessary duplication between the activities of the Commonwealth and other levels of government. And to identify areas or programs where Commonwealth involvement is inappropriate, no longer needed, or blurs the line of accountability.</p>
<p>The terms of reference cover a complexity of institutional arrangements, joint funding agreements and national partnerships. But dismantling this intricate tapestry of intergovernmental financing and policy delivery will require more than the few months allocated to the commission for this phase of its work.</p>
<p>The most valuable and achievable role for the Commission of Audit is to explore the question: what is a meaningful role for the Commonwealth government in the early 21st century? Australia’s Constitution sets out what was considered a meaningful role for the new national government in 1901 but now bears little relation to the complex intermingling of roles and responsibilities.</p>
<p>Since federation, the Commonwealth’s role that has become unstable, while the states and territories have consistently retained their focus on service delivery. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/35896/original/xq7br3wf-1385098845.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/35896/original/xq7br3wf-1385098845.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=402&fit=crop&dpr=1 600w, https://images.theconversation.com/files/35896/original/xq7br3wf-1385098845.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=402&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/35896/original/xq7br3wf-1385098845.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=402&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/35896/original/xq7br3wf-1385098845.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=505&fit=crop&dpr=1 754w, https://images.theconversation.com/files/35896/original/xq7br3wf-1385098845.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=505&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/35896/original/xq7br3wf-1385098845.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=505&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">The division between Commonwealth and state powers requires clarification and certainty.</span>
<span class="attribution"><span class="source">Shutterstock</span></span>
</figcaption>
</figure>
<p>When the government changes federally, so do priorities for investment and attention from the Commonwealth. Federal political leaders frequently campaign on issues under the jurisdictional control of the states and territories and federal public servants have to scramble to get across new policy detail and programs. </p>
<p>The troubled implementation of the <a href="http://www.smh.com.au/federal-politics/political-news/judicial-inquiry-into-pink-batts-scheme-20131027-2w9bn.html">“pink batts” scheme</a> should rightly draw the line under unrealistic expectations of Commonwealth service delivery capacity for some time.</p>
<p>At the moment, we are stuck in a no-man’s land of an out-dated Constitution; an increased demand for state delivered services, for which they lack the revenue base to meet; and intermittent Commonwealth interest and investment in a large number of issues under the banner of “national interest”.</p>
<h2>What’s working</h2>
<p>Despite the general doom and gloom about Commonwealth-state relations, there are a few areas which bear closer study by the Commission of Audit. </p>
<p>The commission should immediately re-endorse the objectives and principles of the first <a href="http://www.federalfinancialrelations.gov.au/content/intergovernmental_agreements.aspx">Intergovernmental Agreement on Federal Financial Relations</a> in 2008. The agreement champions collaborative working arrangements, recognition of the state primacy for service delivery responsibility and a focus on outcomes. </p>
<p>But, as the Council of Australian Governments COAG Reform Council pointed out in its recent report on <a href="http://www.coagreformcouncil.gov.au/reports/reform-progress/lessons-federal-reform-coag-reform-agenda-2008-2013">Lessons for Federal Reform</a>, the commitment to the principles did not flow through to practice, in particular by Commonwealth ministers and their agencies. Cultural change is needed to embed collaborative practice and move from punitive and coercive methods.</p>
<figure class="align-right ">
<img alt="" src="https://images.theconversation.com/files/36428/original/9yf2gmjj-1385618547.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/36428/original/9yf2gmjj-1385618547.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=800&fit=crop&dpr=1 600w, https://images.theconversation.com/files/36428/original/9yf2gmjj-1385618547.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=800&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/36428/original/9yf2gmjj-1385618547.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=800&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/36428/original/9yf2gmjj-1385618547.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1006&fit=crop&dpr=1 754w, https://images.theconversation.com/files/36428/original/9yf2gmjj-1385618547.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1006&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/36428/original/9yf2gmjj-1385618547.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1006&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Other sectors can learn from collaborations on disaster management.</span>
<span class="attribution"><span class="source">AAP</span></span>
</figcaption>
</figure>
<p>An area of joint responsibility worth closer study is emergency disaster management. Australia’s disaster management framework involves the three tiers of government and the response scales up from local to state to Commonwealth, depending on the size of the event. </p>
<p>The disaster management framework reflects the federalism principle of subsidiarity, which states that decision-making should sit as close to citizens as possible. It also acknowledges that effective outcomes are more likely when intergovernmental arrangements establish clear and shared understanding of the roles and responsibilities of the different tiers of government. </p>
<p>With the World Bank describing the response effort to the 2011 Queensland floods as “global best practice”, the model offers lessons for other areas of co-operation.</p>
<h2>Waste and inefficiency</h2>
<p>The Commission of Audit will turn its attention to the big spending areas of health and education. Health is the most complicated and is managed through a complex <a href="http://www.federalfinancialrelations.gov.au/content/npa/">National Partnership agreement</a> which splits funding and service delivery responsibilities. The states do not have the financial capacity to fund current and future demand for health services.</p>
<p>In education, the Commonwealth has a role in funding independent schools, but has progressively expanded into school education more generally. </p>
<p>Yet, in contrast, there is no federal education department in Canada – and Canada has one of the highest performing school systems in the OECD countries. Devolution of education to the state or local level is a feature of the majority of federations.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/35887/original/f6gvq2f6-1385097350.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/35887/original/f6gvq2f6-1385097350.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/35887/original/f6gvq2f6-1385097350.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/35887/original/f6gvq2f6-1385097350.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/35887/original/f6gvq2f6-1385097350.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/35887/original/f6gvq2f6-1385097350.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/35887/original/f6gvq2f6-1385097350.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">The Commonwealth has progressively expanded into school education.</span>
<span class="attribution"><span class="source">AAP/Paul Miller</span></span>
</figcaption>
</figure>
<p>The challenge for the Commission of Audit is to identify what is genuinely an issue of national importance, what requires collaboration and coordination, and what should be left to state or local jurisdictions.</p>
<p>Reducing inefficiency and layers of bureaucracy requires a trade-off between principles – between uniformity and national standards, local policy innovation, competition and recognition of regional difference. This is the ongoing federal tension, and where the contemporary balance falls will guide the deliberations of the Commission of Audit.</p>
<p>Another way to reduce duplication and inefficiency is to re-conceptualise the role of the Commonwealth within the federation. </p>
<p>American scholar Shelly Metzenbaum identifies the role of the centre as that of “system steward”. This role puts the focus on the central government shifting from monitoring and compliance to identifying productive and innovative approaches to problems and disseminating good practice across jurisdictions.</p>
<p>Allied with this positive role, the Commonwealth could provide a safety net, stepping in to avert serious failure, while freeing high-performing states to continue improvements. Such a transition would liberate the Commonwealth from having to maintain duplicate expertise in areas of state service delivery.</p>
<h2>Areas of priority</h2>
<p>The issue of the allocation of roles and responsibilities will be ongoing, even after the Commission of Audit reports. New issues such as gene technology, counter-terrorism or biosecurity will continue to emerge and the federal system would benefit from an ongoing body to make the allocation. </p>
<p>In an <a href="https://theconversation.com/queensland-challenges-abbott-to-end-federal-meddling-20547">address to a recent federalism forum</a>, Queensland premier Campbell Newman suggested a refocused COAG could take on this role. He said COAG could be a “federation arbitrator to draw the line on who does what”. </p>
<p>The establishment of an ongoing body to advise on the allocation of roles and responsibilities between the states and federal government would “unfreeze” the constitution and allow for the systematic management of the allocation as new issues emerged.</p>
<p>The value of the audit and the government’s forthcoming <a href="http://www.liberal.org.au/boosting-productivity-and-reducing-regulation">White Paper on Reform of the Federation</a> is that this work can be done methodically and consciously, and allow a resetting of the federal bargain by moving beyond the short-term patches currently binding together our structural and constitutional arrangements.</p>
<hr>
<p><em>This is part two of The Conversation’s Securing Australia’s future series. Stay tuned for more instalments over the next three weeks.</em></p>
<p><em>Part one: <a href="https://theconversation.com/securing-australias-future-energy-and-climate-change-19691">Energy and climate change</a></em></p>
<p><em>Part three: <a href="https://theconversation.com/securing-australias-future-science-and-research-19516">Science and research</a></em></p>
<p><em>Part four: <a href="https://theconversation.com/securing-australias-future-health-care-19765">Health care</a></em></p>
<p><em>Part five: <a href="https://theconversation.com/securing-australias-future-education-19606">Education</a></em></p><img src="https://counter.theconversation.com/content/19903/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Jennifer Menzies is a member of the Commonwealth Grants Commission and occasionally undertakes consulting work for state government. She is currently working on the Sir Samuel Griffith Legacy Series, partly funded by the Queensland Government.</span></em></p>SECURING AUSTRALIA’S FUTURE: As the Commission of Audit reviews government activity and spending, The Conversation’s experts take a closer look at key policy areas tied to this funding – what’s working…Jennifer Menzies, Adjunct Senior Research Fellow, Griffith UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/196912013-12-03T19:33:40Z2013-12-03T19:33:40ZSecuring Australia’s future: energy and climate change<figure><img src="https://images.theconversation.com/files/35891/original/8p78nbdp-1385098235.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Scrapping climate programs may meet short-term budget goals but will cause long-term pain.</span> <span class="attribution"><span class="source">EPA/Horacio Villalobos</span></span></figcaption></figure><p><em>SECURING AUSTRALIA’S FUTURE: As the Commission of Audit reviews government activity and spending, The Conversation’s experts take a closer look at key policy areas tied to this funding – what’s working, what’s not and where current funds are best spent.</em></p>
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<p>What does it mean to cut “waste” and “excess” in government climate change programs? </p>
<p>To answer this question, the <a href="http://www.ncoa.gov.au/">Commission of Audit</a> needs to consider what these programs should be trying to achieve. After all, pursuing efficiency for efficiency’s sake would be a rather reckless response to an issue that the <a href="http://www3.weforum.org/docs/WEF_GlobalRisks_Report_2013.pdf">World Economic Forum</a> and <a href="http://www.imf.org/external/np/exr/facts/enviro.htm">International Monetary Fund</a> have respectively described as a top five global risk and “one of the world’s foremost policy challenges”.</p>
<p>As temperatures rise to levels <a href="http://theconversation.com/global-warming-unequivocal-and-unprecedented-ipcc-18711">unprecedented</a> in human existence, scientists and <a href="http://webarchive.nationalarchives.gov.uk/20130129110402/http:/www.hm-treasury.gov.uk/d/Executive_Summary.pdf">world-renowned economists</a> are telling us the world needs to rapidly cut its emissions. </p>
<p>The longer we wait (and we’ve already wasted a lot of time), the more difficult and expensive it becomes to avoid dangerous warming. And so too does it become more challenging to cope with the impacts of global warming, such as an <a href="http://theconversation.com/the-human-role-in-our-angry-hot-summer-15596">increased risk of extreme weather</a>.</p>
<p>So, what are we doing in response?</p>
<p>Current federal government climate change programs and policies aim to:</p>
<figure class="align-right ">
<img alt="" src="https://images.theconversation.com/files/35890/original/2trpsy8w-1385098094.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/35890/original/2trpsy8w-1385098094.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=910&fit=crop&dpr=1 600w, https://images.theconversation.com/files/35890/original/2trpsy8w-1385098094.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=910&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/35890/original/2trpsy8w-1385098094.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=910&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/35890/original/2trpsy8w-1385098094.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1144&fit=crop&dpr=1 754w, https://images.theconversation.com/files/35890/original/2trpsy8w-1385098094.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1144&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/35890/original/2trpsy8w-1385098094.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1144&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Are there more efficient ways to reduce emissions?</span>
<span class="attribution"><span class="source">AAP Image/Dean Lewins</span></span>
</figcaption>
</figure>
<ul>
<li><p>create incentives to reduce emissions </p></li>
<li><p>support more renewable energy power </p></li>
<li><p>reduce agricultural emissions and encourage carbon storage in vegetation and soils</p></li>
<li><p>research and assess Australia’s vulnerability to the effects of climate change and assist state and local governments in planning their responses </p></li>
<li><p>participate in international negotiations and assist our Pacific Island neighbours adapt to climate change impacts.</p></li>
</ul>
<p>There’s certainly evidence that some of these programs have been working well. As a result of our <a href="http://ret.cleanenergyregulator.gov.au/">Renewable Energy Target</a>, for example, we’ve installed and built <a href="http://climatechangeauthority.gov.au/ret/final-report/chapter-2">more renewable energy power</a>. The government’s <a href="http://www.cleanenergyfinancecorp.com.au/">Clean Energy Finance Corporation</a> has been able to stimulate so much private investment in clean energy technology that it is helping Australia cut its emissions while <a href="http://www.afr.com/p/national/green_fund_in_the_black_says_jillian_yS05D9rEEb55sLOsiBQBQN">making money</a> for taxpayers (and yet it is about to be scrapped).</p>
<p>But, on the whole, could these goals be achieved more efficiently?</p>
<h2>Waste and inefficiency</h2>
<p>Work has already been done to find out whether and where there’s inefficient double-up in state and federal policies. </p>
<p>Since <a href="http://www.coag.gov.au/sites/default/files/climate_change_mitigation_measures.pdf">late 2007</a>, federal and state governments have been working together to ensure that state climate change programs don’t duplicate those at the federal level. In fact, the Council of Australian Governments (COAG) completed a <a href="http://www.coag.gov.au/sites/default/files/BAF-Review-Carbon-Reduction-Energy-Efficiency-Measures.pdf">thorough review</a> of all state carbon reduction and energy efficiency programs as recently as March this year. The purpose of the review was to:</p>
<blockquote>
<p>…fast track a rationalisation of programs that are not complementary to a carbon price or are ineffective, inefficient or impose duplicative reporting requirements. </p>
</blockquote>
<p>States have already made <a href="http://inside.org.au/not-so-fast-to-the-green-scheme-graveyard/">significant cuts</a> to their programs and policies or determined that there’s no overlap. So, is it necessary for the commission to investigate further?</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/36417/original/z5p6zqdb-1385615686.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/36417/original/z5p6zqdb-1385615686.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=399&fit=crop&dpr=1 600w, https://images.theconversation.com/files/36417/original/z5p6zqdb-1385615686.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=399&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/36417/original/z5p6zqdb-1385615686.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=399&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/36417/original/z5p6zqdb-1385615686.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=501&fit=crop&dpr=1 754w, https://images.theconversation.com/files/36417/original/z5p6zqdb-1385615686.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=501&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/36417/original/z5p6zqdb-1385615686.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=501&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Temperatures are rising to unprecedented levels.</span>
<span class="attribution"><span class="source">AAP/Dean Lewins</span></span>
</figcaption>
</figure>
<p>At the federal level, there has been a consistent effort to weed out underperforming or redundant programs, including by the <a href="http://www.anao.gov.au/%7E/media/Uploads/Documents/2009%2010_audit_report_26.pdf">Australian National Audit Office</a>. Following the introduction of the carbon price and the Clean Energy Future package, for example, many smaller programs and funding schemes were <a href="http://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/BudgetReview201213/ClimateChange">scrapped</a> on the basis that they were no longer necessary. </p>
<p>In 2011, the numerous grant programs for renewable energy – previously administered by different departments – were streamlined and made the responsibility of single agency, the Australian Renewable Energy Agency (which has now had its <a href="http://reneweconomy.com.au/2013/funding-cuts-to-arena-confirmed-435m-gone-32670">funding cut</a>). </p>
<p>In this sense, reforms to ensure that “taxpayers receive value for money for each dollar spent”, as per the terms of the audit, have already been underway for a while.</p>
<h2>Strategic cuts</h2>
<p>The government plans to conduct a departmental review of the <a href="http://www.theaustralian.com.au/national-affairs/policy/ret-review-to-focus-on-high-power-bills/story-e6frg6xf-1226757692465">Renewable Energy Target</a> in 2014 and of Australia’s <a href="http://unfccc.int/files/meetings/warsaw_nov_2013/statements/application/pdf/cop19_hls_australia.pdf">targets</a> to reduce greenhouse gas emissions in 2015. </p>
<p>But the Climate Change Authority – an independent, expert, government body – has already worked tirelessly over many months, consulting extensively with the public and industry to <a href="http://climatechangeauthority.gov.au/reviews">review</a> both of these areas. For all the talk of “strategic cuts”, it’s unclear how repeating this work would be an efficient use of public funding.</p>
<p>The Coalition government also intends to introduce climate initiatives of its own under the <a href="https://theconversation.com/topics/direct-action-plan">Direct Action Plan</a>. These will not commence until after the audit has been completed. </p>
<p>The centrepiece of the Direct Action Plan is an <a href="http://www.environment.gov.au/cleaner-environment/clean-air.html">Emissions Reduction Fund</a> which pays polluters to take on projects to reduce their emissions. The government has claimed this <a href="http://www.environment.gov.au/minister/hunt/2013/sp20131024.html">“reverse auction”, “carbon buy-back”</a> scheme will be much simpler to administer than the carbon price. </p>
<figure class="align-left ">
<img alt="" src="https://images.theconversation.com/files/36424/original/cpvwppy7-1385617119.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/36424/original/cpvwppy7-1385617119.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=935&fit=crop&dpr=1 600w, https://images.theconversation.com/files/36424/original/cpvwppy7-1385617119.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=935&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/36424/original/cpvwppy7-1385617119.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=935&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/36424/original/cpvwppy7-1385617119.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1176&fit=crop&dpr=1 754w, https://images.theconversation.com/files/36424/original/cpvwppy7-1385617119.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1176&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/36424/original/cpvwppy7-1385617119.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1176&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">As temperatures rise, the risk of extreme weather increases.</span>
<span class="attribution"><span class="source">AAP/Steve Gray</span></span>
</figcaption>
</figure>
<p>But a bureaucracy of considerable size would be needed to make it work: at the very least, to assess and select project proposals, develop methodologies to measure and verify emissions cuts, ensure projects meet government contracting requirements and to monitor and impose penalties on polluters that increase their emissions.</p>
<p><a href="http://www.climateinstitute.org.au/articles/media-releases/coalition-climate-policy-increases-emissions-and-risks.html/section/1520">Studies estimate</a> that to meet Australia’s minimum (and <a href="http://climatechangeauthority.gov.au/sites/climatechangeauthority.gov.au/files/files/Target-Progress-Review/Reducing%20Australia%E2%80%99s%20Greenhouse%20Gas%20Emissions-Targets%20and%20Progress%20Review%20Draft%20Report/CCA_TargetsAndProgressReport_Summary_WEB_FA.PDF">paltry</a>) 5% emissions reduction target under this scheme, the government will have to pay polluters billions of dollars. This is far more than the government has budgeted. </p>
<p>It will be taxpayers who fund the emissions cuts (in contrast to the carbon price, which makes polluters pay for their emissions). It’s worth pausing to consider how consistent this is with the <a href="http://www.financeminister.gov.au/docs/NCA_TERMS_OF_REFERENCE.pdf">principles guiding the commission</a> that “government should live within its means” and the Australian government “should have respect for taxpayers in the care with which it spends every dollar of revenue”.</p>
<h2>Areas of priority</h2>
<p>The economic, social and environmental risks associated with climate change are <a href="http://www.youtube.com/watch?v=CQbOlI0YQNs">daunting</a>. Effective government action is necessary to ensure Australia is well prepared to face those risks and is reducing its contribution to the problem in the first place. </p>
<p>For this reason, it is <a href="http://www.theguardian.com/commentisfree/2013/jul/01/carbon-tax-anniversary-climate-change-authority">in the public interest</a> to have impartial, apolitical expert advice feeding into policy development and reform. So, <a href="http://www.theguardian.com/environment/2013/dec/02/carbon-tax-repeal-labor-and-greens-split-bills-to-save-climate-change-bodies">keeping</a> the advisory body, the Climate Change Authority, is a top priority.</p>
<p>But what about efficiency?</p>
<p>Improving the efficiency with which climate programs are administered has its place as part of an effort to improve Australia’s climate policy, but cost-cutting measures are not an end in and of themselves. </p>
<p>With the risk of <a href="http://www.worldbank.org/en/news/press-release/2012/11/18/new-report-examines-risks-of-degree-hotter-world-by-end-of-century">“cataclysmic changes”</a> on our doorstep, short-term savings made by scrapping climate programs and retrenching experienced public servants in the name of budget goals are illusory: we will have to pay them back in the future when the costs of responding to climate change will be much higher and the dangers much greater.</p>
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<p><em>This is part one of The Conversation’s Securing Australia’s future series. Stay tuned for more instalments.</em></p>
<p><em>Part two: <a href="https://theconversation.com/securing-australias-future-governance-and-state-federal-relations-19903">Governance and state-federal relations</a></em></p>
<p><em>Part three: <a href="https://theconversation.com/securing-australias-future-science-and-research-19516">Science and research</a></em></p>
<p><em>Part four: <a href="https://theconversation.com/securing-australias-future-health-care-19765">Health care</a></em></p>
<p><em>Part five: <a href="https://theconversation.com/securing-australias-future-education-19606">Education</a></em></p><img src="https://counter.theconversation.com/content/19691/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Lisa Caripis previously worked as a research fellow on a project funded by the Victorian Centre for Climate Change Adaptation Research. She has also volunteered with non-governmental organisations including the Australian Youth Climate Coalition.</span></em></p>SECURING AUSTRALIA’S FUTURE: As the Commission of Audit reviews government activity and spending, The Conversation’s experts take a closer look at key policy areas tied to this funding – what’s working…Lisa Caripis, Intern at the Centre for Climate and Resilience Research (CR2), Santiago, Chile; Research Assistant, Centre for Resources Energy and Environmental Law, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.