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Labor big-notes its big spending without checking outcomes.

25 May 2013 1,277 views No Comment

WHEN Julia Gillard launched the Labor government’s response to the Gonski report she said her centrepiece was an “an extra $14.5 billion in public investment over the next six years”.

Whether the Prime Minister actually plans on spending this money or not is largely becoming irrelevant – chances are that both she and her loyal deputy, Wayne Swan, will be looking for new jobs come September 15.
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According to opposition Treasury spokesman Joe Hockey, the promise of “extra” funding was essentially “a slipshod attempt to bribe more Australians into voting for a dishevelled Labor Party in September”.

Every press conference and speech since her government’s big “Gonski” announcement, Gillard has gloated about the final dollar value of her “Gonski” offer – notwithstanding that David Gonski talked about $6.5bn of new money a year and, even by the Gillard government’s own admission, Labor’s deal offers substantially less than that.

The telling truth about the PM’s media and other appearances comes in what is not said, rather than what is said. Gillard rarely even mentions improving student outcomes – only the assertion that spending more money will somehow equate with better results. More money equals better services. Or so we are told.

However, the dyslectic child growing up not being able to read or the struggling teenager who needs that little bit of extra help in a chemistry class don’t care what the dollar value that is spent on them is, but on the outcomes actually delivered.

Rather than offering policies that have undergone careful consideration and consultation, federal Labor’s solution to nearly all the problems confronting it is to big-note its spending in the area. It doesn’t matter if we are talking about indigenous funding, health programs or social welfare, federal Labor seems to think that all Australians care about is how much money is spent.

The same goes for foreign aid – a 15-year-old girl in East Timor doesn’t care if a clean water pipe to her village costs $100 or $100,000, only that she and her family receives ready access to fresh drinking water.

Perhaps if we spent less more effectively then we’d have better outcomes for our children, our disabled, our elderly, and those that we are trying to help overseas. Surely, having money as the only barometer of success leads to negative, rather than positive, outcomes.

Last year, the Auditor-General found Labor’s $540 million literacy and numeracy national partnership “is yet to make a statistically significant improvement, in any state, on the average NAPLAN results of schools that received Literacy and Numeracy National Partnership funding”.

That’s $540m that could be spent on essential services, repaying the debt or – dare I say it – returned directly to the taxpayers that provided the money in the first place.

All governments need external checks – and under Labor commonwealth Auditor-General Ian McPhee has been working overtime – calling out the government on wasteful spending and dishonest practices.

But a single auditor-general cannot keep the whole of the federal government honest. Governments need to look closely at their own expenditure to ensure that what they do is being done cost-effectively. Or whether that service could be better and more appropriately provided by the private sector.

That’s why the proposal of Tony Abbott and Joe Hockey to hold a “commission of audit” to look into the public sector makes a great deal of sense. Four months out from the election, I am willing to state that this policy will be one of the soundest 2013 election policies to be released by either party.

The recently released budget papers confirm that the Gillard government is spending more and more each year – projected to be almost $400bn for the 2013-14 year. No one can say with any seriousness that millions of federal dollars aren’t being wasted every single day.

Hockey is acutely aware of this. He was a human services minister in the Howard government – responsible for overseeing what would be, in today’s dollars, more than $130bn of expenditure, with payments being made to millions every week through agencies such as Medicare and Centrelink.

Who knows what Labor inefficiencies will be identified by the commission of audit? And that underscores the urgent need for such a commission. A similar “line by line” audit of government expenses has not been undertaken for more than 15 years; and so, bar reports from the Audit Office, from up-and-coming members of parliament or from the few switched-on investigative journalists still working in Australia, the scale of government waste and mismanagement is not known to the community. In this tight fiscal environment, we are learning our lesson the hard way – over a quarter of a trillion dollars of gross debt, and seven straight deficits, is testimony to a government that wastes money and doesn’t come within cooee of living within its means.

The first rule of any government should be the need to live within its means and make sure the taxpayers they are leaning on for their pay cheques are indeed getting value for money.

In the tight fiscal and economic situation in which we find ourselves, we should not be focusing on how much is spent, but on the actual impact that spending has in the community.

The reality is that often with government, less is significantly more.

Ross Fitzgerald’s memoir ‘My Name is Ross: An Alcoholic’s Journey’ is now available as an e-book.

‘The Weekend Australian’, May 25-26, 2013, Inquirer p 22.