A 21st century cabinet needs a 21st century system of government

From our unique position as the peak voice in governance, the Australian Institute of Company Directors can say that no competent director – public, private or not-for-profit – would be expected to govern their organisation in the way we govern the country.

This article appeared in the Sydney Morning Herald on 23 September 2015 (subscription may be required).

Malcolm Turnbull’s 21st century cabinet needs a 21st century system of government to deliver on its promise of reform.

From our unique position as the peak voice in governance, the Australian Institute of Company Directors can say that no competent director – public, private or not-for-profit – would be expected to govern their organisation in the way we govern the country. Directors operate according to a 21st century, world’s best corporations law that changes regularly to adapt to the needs of consumers and the economy. In contrast, Malcom Turnbull’s 21st century cabinet will operate within a system that was designed in the 19th century and has changed little since. The wigs and gowns are gone, but the machinery of government still bares the hallmarks of a bygone era.

We need a system of governing that allows our governments and those who run them the ability to make long-term decisions in the best interests of our nation. A three year term of the national government practically delivers only two years of unhindered governing. Ask any chairman, director or CEO if they can develop, consult and implement major reform in two years.

The Commonwealth and Queensland remain the only two jurisdictions with three year variable terms of Parliament. Over the last 30 years the other jurisdictions with three year terms have moved to four and most have also adopted a fixed term. Compare this to four years in the US and Germany, and five years in the UK, France and Indonesia.

The term of the Commonwealth Parliament must increase to four years with either a fixed term or a minimum three of four years to give elected governments time to consult, legislate and implement important reforms – and for the people to see the reform in practice before judgement.

We must also reform the election laws that allow the Senate to be controlled by minor party and independent Senators with ridiculously low primary votes. It is inconceivable that the people of Victoria and Tasmania deliberately set out to elect to the Senate people and parties with just 17,000 and 22,000 primary votes.

We do not suggest making it easier for Governments to control the Senate. It has only happened three times in the last 30 years. We have a long tradition of third parties and genuinely popular independents in the Senate. The discipline of a government needing to persuade the people and the Senate of their reforms is good. But electoral mandates and urgent responses to security and economic emergencies must be respected. There are other flaws in our political system too.

Ten years ago, in another life, I wrote in a major newspaper about the failures of our federated system of government. I said “…our federal system is broke. It is a confused, duplicated and irresponsible mess of failed public administration. COAG risks becoming a club of Australian governors rather than a reform vehicle.”

Back then the participants embraced “cooperative federalism”. Ten years later the niceties of COAG (aka the Council of Australia Governments) have delivered very little reform. With the exception of the veteran WA politician now Premier Colin Barnett’s clear frustration, today’s participants continue the pantomime that COAG is the nation’s reform vehicle.

Over the last 20 years, the old school combative Premier’s Conferences (read NSW and Victoria v the rest) have been replaced by the pleasant but increasingly useless COAG. And in this time, despite the neatness of the funding arrangement flowing from the GST (the Commonwealth raises it and the states and territories spend it, however inequitably) the blurred lines of state/federal funding and responsibilities has, with very few exceptions, actually got worse.

In schools, the Commonwealth has continued to intervene in curriculum and standards whilst significantly increasing its direct involvement in funding. Early childhood continues to be a confusing hash of dual responsibilities. Skills education – a major prerequisite for a productive and competitive economy – is still run separately by each state.

In health, the stalemate continues between federal funding, control of Medicare, pharmaceutical benefits, aged care and private health insurance and state control of hospitals. Workplace relations and work health and safety remain unfinished reform with a semi complete national regulatory structure.

These are all areas in which the division of Commonwealth and state responsibilities must be resolved.

The only notable success of the last 10 years, although still a work in progress, is the National Disability Insurance Scheme which is seeing funding, regulation and sole control of disability services handed over by the states and territories to the Commonwealth.

Finally, Australia’s governments need to commit an agenda of practical federalism in micro economic reform and the elimination of the remaining areas of duplication. When was the last time you heard a Prime Minster or Premier talk about micro economic reform? Whilst there are some signs of hope – Mike Baird and Jay Wetherill joining forces to put the GST back on the agenda – not since Bob Hawke and Nick Greiner’s “New Federalism” agenda in the early 1990s have we heard a shared vision for reform.

Inherent in all of the above is a commitment to argue the case, persuade the doubters, remain open to sensible compromise and stay the course. These debates require reasoned argument and debate and the willingness for us all to win and lose for the nation’s betterment.