John Menadue

  • Peter Gibilisco. The standardisation of services for people with disabilities.

    WHAT IS MEANT BY EFFICIENCY IN THE PROVISION OF SERVICES FOR PEOPLE WITH DISABILITIES? IS IT JUST A COVER FOR GREATER STANDARDISATION? 

    The State Disability Plan is not the only endorsement of the need to emphasize the individualising of care for people with disabilities. We now hear of a profound development – person-centred planning is said to be the world-wide benchmarked best practice. This involves a highly individualised vision of the person with disabilities and the result is that care needs multiply into a kaleidoscopic variety of individually generated special needs and concerns.

    This attempt to generate a sensitive and compassionate approach nevertheless faces an ongoing dilemma. The costs associated with such an approach to provision of disability services continue to outstrip the services that can be provided by the pension. Moreover, the demands (and possibly the false needs as well) that are generated by this latest example of neo-liberal micro-reform of the “disability workplace”, has the effect of further transforming the already precarious environment for care-worker and the client.

    I continue to think about what happened at a recent meeting that was convened by my own “service provider” to discuss with us an increase in rent for residents.

    At this meeting, we were told of plans to sell the provider’s prime real estate in the Melbourne CBD. A question was asked about the way in which the provider was viewing this sale. The discussion seemed to be suggesting that the sale could assist the provider in overcoming its budget problems. That was why as a corporation it was considering divesting itself of one of its assets.

    So the suggestion was put to the provider that if the building in Flinders Street was being sold for budgetary purposes, a small amount of the profit from the sale could be used to help the pensioners among the residents overcome their budget problems that would accrue from an increase in the rent.

    After all, the service provider is keen to present itself to the community as an effective not-for-profit company, and so all of its profits are to be ploughed back into the community it is serving. And residents certainly wish to have their part in this community recognised. They are not merely rentiers; they are constitutive of the provider’s “community”.

    The assets held by the provider are retained by it to enable the provision of a service it is constituted to provide.

    I had assumed all this but those representing the provider’s main office did not seem to get these basic points. Do they understand what a not-for-profit service provider is? I asked myself. They gave the impression that the budgetary problems of the residents were completely different from the financial demands that are upon the provider as these are documented in the company’s official accounts.

    And of course, these budget stresses and strains are not exactly the same thing. We residents also have to be responsible for how we manage our finances and that in fact was why we had insisted upon having the conversation in the first place. But just because they are not the same thing, does not mean they are unrelated and their inter-dependence ignored. To dismiss the suggestion that the profits from the sale might be distributed in a way that helped ease the strain on the budgeting of residents, seemed to suggest that the provider’s budget issues are a completely different kind of responsibility to those residents have for their own finances. Moreover, the residents are part of a community comprising themselves and the workers at all levels.

    So I guess the result was somewhat inevitable. Disgruntled residents will be left wondering how the sale of this prime real estate shores up the company in a way that will enable top management to be paid at the level to which they have become accustomed. So where will the profits from this sale go? In ensuring the immediate “business prospects” of provider, the company will, I guess, reduce some of its current budget deficit. But at the same time, there is still unrequited budget pressure for residents due to rent increases.

    Let me change the topic slightly here and note how in these days of cut-throat public relations, the provider may be confusing the services it provides with replacing proper policy-development with slogans. Let me invent a possible slogan:

    ACE DISABILITY SERVICES – We are here to give independent and fulfilling lives to people with physical, intellectual and multiple disabilities. Lovely slogan isn’t it? But then reflect upon the efficiencies that are required in shared supported accommodation like my own. And now look carefully at that phrase: people with physical, intellectual and multiple disabilities. I am not criticizing the ethical intention; I am trying to draw attention to the inner organizational chaos that will result for workers and residents if a facility conflates physical and intellectual disabilities. And who can tell how care for those with “multiple disabilities” can emerge in the midst of such organizational blurring.

    There are many residents, perhaps an overwhelming majority of up to 80%, in supported accommodation with some form of intellectual disability. Therefore it can be expected that in shared support accommodation like the place where I reside, that a policy of taking on such high demand people will simply result in a standardization of disability care for many service providers. And don’t get me wrong. Such people are also my neighbours and deserve proper care. But by putting all disability together in one facility, even if there are different classifications on paper in a provider’s policy documents, there will be an inevitable drive toward standardized care and abstract efficiency, that may allow the provider to continue its “service provision” rather than actually looking to the individual care of people with disabilities.

    Quite seriously, this is what I fear will happen. Without a rediscovery of how residents are genuine members of the community that the service provider is maintaining, a policy will develop in favour of standardisation over the appropriately differentiated individual care needed for people with disabilities in shared supported accommodation.

    Service providers receive much money for the care of people with disabilities. These payments come in the form of funding, government payments, and donations from other for-profit companies and the general public. But among residents of such facilities in the disability sector the suspicion is deeply ingrained that these funds never seem to meet the need for which they were intended. And requiring service provision to be subject to a culture of competitive tendering processes means that what were once not-for-profit bodies are not driven by a non-charitable need to accumulate the accoutrements of “business success” coinciding it seems with the self-serving “need” to provide their own CEOs and senior management with wages or salaries or packages as if “management” is a sphere that floats high well above the reality of the people their company is supporting.

    Most people with disabilities are highly individual, not unlike the rest of humanity. And indeed it is from this individuality that life becomes extremely complex. So, when people with disabilities are recognised for their individuality and diverse needs then it becomes apparent what treatment they require. That then is the moment when due respect is needed.

    Recently, over the rents, we have witnessed a significant demise in the provider’s ethos; fairness has been jettisoned. This has been a harrowing experience for me. I am yet to feel that I have been treated according to the stated and published goals of the provider. And then when severe disability is added to the mix of this residence, I conclude that the appeals to standardization and the need to run an efficient enterprise are simply ridiculous.

    As a resident of the facility supported by this service provider, I am certainly NOT a ’customer’. This word and its usage has passed its “use-by date”. In this context ‘customer’ refers to a person who is vulnerable and inadequate. I am assured of my vulnerability; I quite literally feel it in my bones. But am I inadequate? That is what is being questioned in these efficiency policies? Does one have to be a celebrity like Stephen Hawking before one can qualify for non-stereotyping?

    Yes branding costs money, too. But it’s ok if the payoff of new logos is spent beneficially in not-for-profit service management, rather than in making more attractive packages for over the top management. It is surely the responsibility of any company’s management to ensure its good public image. But this is not merely a function of the sales of assets to wipe out a deficit. And appeal to a black ink entry on the bottom line of a company’s account books can always be heralded in way that diverts attention away from the inner organisation dysfunction, if not moral bankruptcy.

    Special thanks to Christina Irugalbandara,  Cunxia Li and Bruce Wearne.

    For some time now I have been discussing my deep concerns about the way my support facility is managed with Bruce Wearne who helps me by smoothing my English for publication. In this latest piece, the more we discussed the topic, the more it became obvious that my angle of vision was sharpened by Peter Sember whose encouragement has meant so much to me. He came along to the meeting I describe in this piece. He was the one who set the cat among the pigeons by asking the kinds of questions I now continue to ask in this article. Sadly, he died a short time after going out of his way for me on that occasion and I feel it a great honour to dedicate this article to his memory.

    Dr Peter Gibilisco, is Honorary Fellow, University of Melbourne. His new book is ‘The Politics of Disability’.

     

  • Walkley Award for refugee advocate, Safdar Ahmed.

    All the 2015 Walkley Award Winners announced on Thursday evening came from mainstream media organisations except one, Safdar Ahmed. Safdar, who won in the ‘Artwork’ category for his documentary web-comic Villawood: Notes From An Immigration Detention Centre, is a Sydney-based artist and academic in the field of Islamic studies.

    safdar

    The work depicts the stories of asylum seekers and refugees inside Sydney’s Villawood detention centre. It includes the testimony of people from Iran, Iraq, Afghanistan and Sri Lanka, including men, women and teenagers. Some of those included are long-term detainees who have been detained for up to five years.

    The Walkleys presented it as a project of GetUp! The Shipping News, which is a crowdfunded initiative that has provided grants to journalists working on asylum seeker stories. Safdar posted it earlier this year in his space at the Twitter-owned Medium.org publishing platform.

    We can’t exactly boast that we have a Walkley award winner, but Pearls and Irritations featured it back in March and we are proud that Safdar gave us his blessing and permission to use it. Safdar’s aim to use art as a tool of advocacy on behalf of asylum seekers is in harmony with the purpose of this blog.

    The comic shows the disempowerment experienced by refugees in detention and the methods employed to survive and resist it. A chapter recounts the death of Ahmad Ali Jafari, a young Afghan refugee who suffered a heart attack within the centre in 2013. Forms of resistance depicted in the comic include acts of non-compliance, self-harm and one refugee’s participation in a rooftop protest.

    Safdar writes: ‘I hope this Walkley Award gives the comic more exposure, which seeks to depict some truths about mandatory detention and prompt people to question or rethink why Australia abuses refugees for politically-driven ends. I’d like to thank all the asylum seekers and refugees who participated in the project, for sharing their experiences with me. The comic is dedicated to them and to my late friend, Ahmad Ali Jafari. 

    ‘My thanks to GetUp’s The Shipping News Project, and to the 4700+ members of the public who contributed to their crowd-sourcing campaign. This award underscores the importance of alternative types of journalism, including documentary comics, in tackling important issues. Thanks also to everyone in the community art organisation Refugee Art Project, which this comic was inspired by.’

    The Walkleys judges commented: ‘Photos are not permitted within Villawood Detention Centre, so Ahmed has conveyed through his graphic novel style the conditions within the Detention Centre. By using the stories and often the artwork of the asylum seekers, Ahmed has produced a moving documentation of their plight, and a damning condemnation of Australia’s detention system.’

  • NBN and the high cost of copper.

    Lauraine McDonald in ‘itwire’ has just reported that ‘An NBN cost scandal has erupted with a new document revealing that copper for the Turnbull government’s hybrid MTM broadband network is going to cost ten times as much as the original estimate.’ 

    John Menadue

    See link to full article below.

    http://www.itwire.com/it-industry-news/telecoms-and-nbn/70623-nbn-copper-cost-blowout-exposes-government-short-sightedness

  • Travers McLeod. Relaxing airstrike rules is a recipe for disaster.

    Tony Abbott has argued Australia and her allies should relax targeting rules for airstrikes to destroy the Islamic State.

    At best, he is ignorant of the lessons of the military campaigns waged in Iraq and Afghanistan since 2001. At worst, he is willing to repeat mistakes to differentiate himself on national security and open a pathway to take his job back.

    Let’s assume, for the sake of argument, that Abbott isn’t as narcissistic as the latter reading suggests. Let’s assume he was insufficiently briefed on recent military campaigns or has forgotten the lessons of our longest wars.

    The battle of ideas, not body counts, will determine this war. Disproportionate use of force will only inflame and grow the Daesh insurgency. There is no military solution to destroy IS.

    “A military force, culturally programmed to respond conventionally (and predictably) to insurgent attacks,”wrote General Stanley McChrystal in November 2009, “is akin to the bull that repeatedly charges a matador’s cape – only to tire and eventually be defeated by a much weaker opponent.”

    McChrystal should know. He was commander of the United States-led coalition of forces in Afghanistan from 2009-2010 and headed up US Special Forces in Iraq and Afghanistan from September 2003 until February 2006.

    When McChrystal took over as commander he told his troops to “get rid of the conventional mindset”.

    We know the prequel. In 2005 the US was accused of being a “lawless hegemon”, one that avoided the laws of war or sought to exploit gaps within it. Commanders misunderstood the battlespace in Iraq and Afghanistan. Their “enemy-centric” mindset harmed civilians and alienated the people. David Kilcullen described US forces as “chasing their tails”.

    From late 2006 military doctrine, strategy, tactics and rules of engagement began to shift decisively. Australian military advisers and judge advocates were pivotal in this change of mindset.

    Phillip Bobbitt put the new position best in 2010: “The war aim in a war against terror is not territory, or access to resources, or conversion to our way of political life,” Bobbitt wrote. “It is protection of civilians within the rule of law.”

    McChrystal’s tactical directive to troops in July 2009 made this explicit. “We must avoid the trap of winning tactical victories – but suffering strategic defeats – by causing civilian casualties or excessive damage and thus alienating the people.”

    Losing popular support would “translate into more insurgent recruits, more IEDs, and a prolonged conflict with an uncertain outcome.”

    McChrystal prohibited the use of air-to-ground or indirect fire against residential compounds with three tightly-specified exceptions, installed new battle damage assessment requirements, denied capacity for unilateral missions without regional command approval, raised the approval level for night raids, tightened escalation of force procedures and mandated civilian casualty investigations and reporting up the chain of command within 24 hours from any given incident.

    McChrystal was clear: “Our success depends on our ability to escalate force proportionally, in a manner that the average Afghan civilian can understand, and respects the fact that this is their country.”

    Successive studies of countering insurgencies reveal that if one loses legitimacy they lose the war. This means one cannot separate the conduct of operations from the broader, contested narrative of a war.

    Securing the population and killing the enemy is a necessary condition to countering Daesh. But the chief lesson of the Iraq and Afghanistan campaigns is that the legality of the conduct of those operations is central to their legitimacy.

    This is why proportionality has become a watchword for countering insurgencies successfully. It requires a delicate but appropriate balance to be struck between military necessity and collateral damage, in an age when allegations of disproportionality can be uploaded to YouTube and viewed across the world in seconds.

    US military doctrine now asserts that “all interactions between security forces and the population directly impact legitimacy”. Complying with the law of war helps to gain local trust – violations “have a direct and significant negative impact on the ability to conduct successful counterinsurgency operations”.

    Abbott now advocates “less restrictive targeting rules for airstrikes”. His position may be more nuanced. He may dispute current distinctions between civilians and combatants, including what it means for civilians to participate directly in hostilities. As stated, his position is pregnant with ambiguity.

    Such hawkish ambiguity is exactly what Prime Minister Malcolm Turnbull ruled out last Tuesday in his National Security Statement to Parliament. Turnbull called for “calm, clinical, professional, effective” conduct to defeat IS, not “gestures or machismo”. He said “the strongest weapons we bring to this battle are ourselves, our values, our way of life”.

    In war the most significant distinction is between civilians and combatants. The latter are lawful targets who can be killed. We water down the distinction at our peril. This is but one way in which our military forces live our (and their) values.

    Countering insurgencies, former US Central Command head General James Mattis once said, is only new if “we don’t read our own history”.

    Given our focus these past weeks on France, it’s worth recalling that the best-known military theorist and practitioner of counterinsurgency was French. Lieutenant Colonel David Galula’s formula was simple: win the support of the people. “Antagonising the population will not help,” he wrote in 1964, “rash actions on the part of the forces should be kept to a minimum.”

    An ad-hoc legal approach to fighting terrorism would return us to the fog of law within the fog of war. It is a recipe ripe for disaster.

    Travers McLeod is chief executive of the Centre for Policy Development and the author of “Rule of Law in War: International Law and United States Counterinsurgency in Iraq and Afghanistan” (Oxford University Press, 2015).

  • Rod Tucker. What will the NBN really cost?

    Cost is a central issue in the ongoing debate about the best approach to building Australia’s National Broadband Network (NBN).

    In 2013, the Coalition argued that Labor’s original all-fibre to the premises (FTTP) network could cost as much as A$94 billion. In the 2016 NBN Corporate plan the figure was revised down to A$74 billion to A$84 billion, while NBN Co’s multi technology mix (MTM), incorporating fibre to the node (FTTN) and upgraded hybrid fibre coax (HFC) was less costly, with a price tag of A$46 billion to A$56 billion.

    Since the Coalition announced these numbers, Labor has said that, if elected, it will not go back to an all-FTTP network, but instead pursue a half-way option, in which the HFC component of the MTM is retained but FTTN, the slowest and most limited technology, is phased out.

    It’s worth looking more closely at cost difference between FTTP and FTTN to see if the claimed A$84 billion to A$56 billion maximum cost comparison stacks up, and see where Labor’s new half-way solution sits.

    Capital costs

    The NBN 2016 Corporate Plan states that the average capital cost (capex) to connect a home or business to the NBN using FTTP is A$3,700. But the real cost for a FTTP connection is probably less than this.

    The A$3,700 figure quoted by nbn co is based on old construction techniques that have been superseded in other parts of the world. The costs of rolling-out FTTP in New Zealand, for example, have been dropping steadily in recent years and will soon be A$2,900 per premises. For some reason, NBN Co has yet to acknowledge the lessons learned in New Zealand.

    Let’s give NBN Co the benefit of the doubt and assume that the A$3,700 cost per premises for FTTP is correct. In comparison, the 2016 Corporate Plan states that the average capital cost for a FTTN connection is A$1,600, or A$2,100 less than FTTP.

    For an upgraded hybrid-fibre-coax (HFC) connection the capital cost is A$1,100, or A$2,600 less. However, in light of recent revelations in a leaked document from NBN Co published by Fairfax indicating that it may be necessary to overbuild Optus’ HFC network, the savings offered by HFC will not be as good.

    Using these numbers, it is easy to compare the capital costs of different networks.

    At the end of construction, the MTM network will provide FTTN to 4.5 million premises and HFC to 4 million premises. Labor’s new approach is to replace as many as possible of these 4.5 million FTTN connections by FTTP. The maximum additional capital cost to do this would be 4.5 million times A$2,100, or A$9.5 billion. This figure corresponds to A$790 per premises averaged across all 12 million premises in Australia.

    An all-FTTP network could be achieved by also replacing the HFC connections were by FTTP, the total additional capital cost of this hypothetical all-FTTP network would be A$19.9 billion, or A$1,658 per premises averaged across all premises.

    Peak funding

    Of course, it is necessary to also consider operational expenditure (opex) – the cost of running the network – and revenues from the network. These factors all contribute to the peak funding figures in the 2016 Corporate Plan.

    Peak funding is the maximum cash outlay required before cash flow becomes positive. Peak funding is a useful measure of cost because it is a direct measure of the cash outlay required. But it is not necessarily a good measure of the cost of the network infrastructure or a good measure of the net financial cost/benefit to the Australian taxpayer.

    Operational expenditure is a major issue for the MTM network because of factors including the need for new software management systems, the additional costs of maintaining the degrading copper wires in the FTTN network, and the cost of the electricity required to power the FTTN nodes located in suburban streets. Importantly, an FTTP network would incur none of these costs.

    In fact, the leaked nbn co document mentioned earlier shows that the operational costs of FTTN network are 67% more than for FTTP, and the operational costs of HFC are 25% more. Over the lifetime of the network, this difference could amount to billions of dollars, greatly reducing the overall difference in costs between FTTN and FTTP.

    Another factor that reduces the cost difference between the Coalition’s network and Labor’s new alternative is that a Labor’s FTTP/HFC network would be capable of generating higher revenues through the delivery of premium services that would not be achievable with a slower-speed FTTN network.

    This is well documented by high-profile companies such as Ovum, which predicts FTTP services will drive the highest global growth rates for broadband revenues over the next five years, based on premium speeds of 100 Mbps and higher.

    Timeframes

    In light of all these factors, why is NBN Co’s cost estimate for a hypothetical FTTP network so large? The NBN Corporate plan provides no detailed information on its financial modelling, but it states that an all-FTTP network would take until 2026 to 2028 to complete.

    If the timeframe was indeed as long as this, the revenue stream would be delayed. This could indeed lead to unrealistically large numbers for the peak funding cost of FTTP.

    So where does the 2026 to 2028 timeframe come from? My guess is that NBN Co has simply extrapolated from the present rollout rate for FTTP, which has not increased much since 2013. One piece of supporting information comes from a Senate Estimates meeting, where NBN Co confirmed that its A$74-84 billion number was not for a “continued” FTTP network but for a “restart” from the current plan.

    NBN Co waited until September this year to hire additional staff, increasing the number of employees from 3,400 to 4,500 to speed up the rollout of FTTN. If it had hired these additional staff in 2013 and focused on the FTTP rollout, the network could well have been completed by around 2020 or 2021.

    Rod Tucker is Laureate Emeritus Professor, University of Melbourne. This article was first posted in The Conversation on 1 December 2015.

  • Sebastian Rosenberg. Mental health changes.

    Announcing the federal government’s response to the National Mental Health Commission’s review of mental health services today, Prime Minister Malcolm Turnbull emphasised the concept of patient choice.

    The commission’s review was the latest in a long line of reports showing that for many Australians needing mental health care, their current choice is between getting no care or getting poor care.

    The reforms announced today have the potential to change this appalling situation. But ultimately they should be judged on the outcomes they achieve for patients.

    Poor access to care

    Mental health is the third-biggest chronic disease in Australia behind cancer and heart disease, affecting 4-5 million people each year.

    Access rates to care are low. And once a person has seen their general practitioner or psychologist, if their condition deteriorates, they have few options but to seek care from their local hospital emergency department.

    Following deinstitutionalisation 30 years ago, which overturned the practice of sending people with severe mental illness to asylums, Australia largely failed to invest in a genuine system of community mental health care.

    The bar for entry into the state-run hospital system rose, so you must be sicker and sicker to qualify for care. Rates of access to state and territory mental health services have not changed in some years. Yet spending has increased by more than 50%.

    We are, in fact, over-reliant on hospitalisation and there is waste. An unpublished survey by state governments indicated that more than 40% of all hospital mental health beds were occupied by people who would be better off in other settings if there was anywhere to send them.

    Mental illness also has a colossal impact on productivity and economic participation. The OECD estimates the average overall cost of mental health to developed countries is about 4% of GDP. In Australia, this would equate to more than A$60 billion or about A$4,000 a year per individual taxpayer.

    Tailored responses

    The federal government’s announcements have the potential to address these problems by presenting two key structural changes.

    The first is the decision to use the new Primary Health Networks (PHNs) to keep people with mental health problems out of hospital, by building new, integrated and stepped approaches to primary and community mental health care. Under the Abbott government, PHNs replaced Medicare Locals. PHNs’ role is to both plan and commission (fund) primary and community care.

    This means having the capacity to respond to all the problems a person might have, including not just their mental illness, but drug and alcohol issues, physical problems, homelessness and other problems. It also means having a range of services available to match the intensity of the person’s needs.

    PHNs will be tasked with properly planning to meet the mental health needs of the regions they serve.

    Given the size of the PHNs, some may require multiple plans to ensure they understand and can respond to locals’ needs. One of the PHNs in Western Australia covers an area the size of much of Western Europe, so plans will need to cater for diversity within regions.

    The second key structural change offered under these reforms is to end the dependency on simplistic fee-based services. The government has recognised that just sending people off for a set number of psychology sessions is an inadequate response, particularly for people with more complex conditions.

    The suggestion is that people with less complex problems should access evidence-based mental health therapies and services online.

    For others, a continuation of the Better Access program, which subsidises ten sessions with a psychologist or psychiatrist, may be entirely suitable.

    For people with more complex problems, however, the government has flagged its intention to permit PHNs to cash out some of their Medicare Benefits Schedule payments into new pooled funding arrangements to meet locally identified needs. PHNs would have the capacity, for instance, to build further on successful programs such as headspace or the Mental Health Nurse Incentive Program.

    These reforms suggest that better understanding individual needs can lead the PHN to more intelligently plan individual responses, bringing together clinical care and social supports such as living skills, vocational training and education.

    Overcoming barriers

    The government’s changes to mental health are not without challenges. It’s unclear whether PHNs will be up to the job, and what support they need to make the scheme work.

    The changes don’t appear to be supported with any new funding, yet we know the mental health system is under-funded. Mental illness accounts for 13% of the burden of disease but receives only around 6% of the total health budget. It should be noted that the “cashing out” arrangements are uncapped, opening up the potential for new funding under Medicare.

    Most importantly, we need to ensure these changes marry up to commensurate reforms by the states and territories. The fifth national mental health planning process now underway has proven ineffective in joining up mental health approaches between governments. The Commonwealth has pledged new leadership and it is here that it is needed most.

    Finally, the Commonwealth must establish a new and robust approach to accountability. Regionalism cannot mean we let myriad programs start and go unevaluated. Instead we need strong and consistent approaches to data collection, providing real information about things that matter.

    Rather than reporting on bed numbers, these processes need to reveal the extent to which PHNs are actually working to help people with a mental illness stay out of hospital, recover from their illness, complete their education, resume employment, avoid homelessness and become healthy and productive members of the community. None of this information is currently available.

    Prime Minister Turnbull stated that these changes were about trying to make the most of Australia’s mental wealth and human capital. His goal is laudable. But the work starts now.

    Sebastian Rosenberg is Senior Lecturer, Brain and Mind Centre, University of Sydney. This article first appeared in The Conversation on 26 November, 2015.

  • Travers McLeod. Unusual suspects challenging usual thinking on climate change.

    “The greatest trick the devil ever pulled was convincing the world he didn’t exist.”

    Twenty years ago Kevin Spacey uttered this famous line about his alter ego, Keyser Söz, in The Usual Suspects. Keyser Söz isn’t climate change, but he might as well be.

    Since the film was released an inordinate amount of money has been spent to trick the world that human-induced climate change doesn’t exist.

    Recent data from the CSIRO suggests the ‘trick’ is yet to be completely foiled in Australia. Although almost 80 percent of people believe climate change is occurring, every second person routinely changes their mind and there is considerable divergence on whether human activity is a causal factor.

    Thankfully, someone who requires no more convincing is Mark Carney, the Canadian Governor of the Bank of England.

    “There is a growing international consensus that climate change is unequivocal,” Carney said in September.

    “Human drivers are judged extremely likely to have been the dominant cause of global warming since the mid-20th century.”

    Carney, like his Chief Economist, Andy Haldane, is what I call an unusual suspect, someone who looks beyond the parapet and leads on an issue when we don’t expect them to.

    Think doctors and nurses on children in detention and sporting heroes like David Pocock on marriage equality.

    Although we might deem these interventions ‘unusual’ given their infrequency, they can be perfectly natural for the individual speaking out. Often they are based on experience or expertise.

    This makes unusual suspects particularly insightful, and especially powerful.

    Carney’s incursion into the climate change debate shouldn’t be taken lightly. He also heads up the global Financial Stability Board, established after the Global Financial Crisis.

    It was no coincidence Carney gave his speech at Lloyd’s of London.

    Insurers know full well the rising cost of weather-related events, aggravated by climate change, from around $10 billion per year in the 1980s to $50 billion today. These losses, Carney conceded, will “pale in significance” to those on the horizon when we consider “broader global impacts on property, migration and political stability, as well as food and water security”.

    Carney and Haldane argue the physical, liability and transition risks posed by climate change threaten financial stability.

    They are progressives amongst a hitherto conservative central banking set.

    Haldane in particular has bemoaned “quarterly capitalism”, which sees public companies over-discounting future income streams by 5-10 percent per year.

    He believes “shareholder short-termism may have had material costs for the economy, as well as for individual companies, by constraining investment”.

    Haldane is not alone. Larry Fink, Chairman and CEO of BlackRock, wrote to S&P 500 CEOs in April, accusing them of prioritising actions to deliver immediate returns and “underinvesting in innovation, skilled workforces or essential capital expenditures necessary to sustain long-term growth”.

    Where are Australia’s unusual suspects in business and finance?

    One would find it difficult to locate seminal speeches on climate change and quarterly capitalism by our central bankers or the Business Council of Australia

    Much has been made of our tepid growth outlook. Reserve Bank Governor Glenn Stevens challenged the National Reform Summit to ask: “how do we generate more growth? Not temporary, flash in-the-pan growth, but sustainable growth”.

    The adjective — sustainable — is key. Focusing on growth at all costs risks missing the wood for the trees. To engineer sustainable growth, one requires a sustainable economy. And that is what Australia lacks most of all.

    It is a shame, because sustainability is in Australia’s DNA.

    In fact, in 2011, then Treasury Secretary Martin Parkinson told us “the theme of sustainability will need to shape the approach to policy development of this generation”.

    Parkinson was and remains spot on: his focus was on how each generation could bequeath to the next a productive base for sustainable wellbeing at least as large as the stock of capital inherited.

    How shortsighted it was for one of our best unusual suspects to be dumped by the Abbott government.

    His likely reemergence as head of the Department of Prime Minister and Cabinet is timely.

    At his alma mater, Princeton, in September, Parkinson echoed Carney by saying company boards and financial market regulators give scant attention to climate change risks. Equally absent was examination of the “knock-on effects to macroeconomic stability of falling demand for carbon-intensive exports”.

    Accelerating Australia’s transition to a sustainable economy will require those in business, finance, government and civil society to embrace unusual suspects on climate change and sustainability as the new normal, not the exception. If anyone can do this knitting, it’s Parkinson. Welcome back.

    Travers McLeod is Chief Executive of the Centre for Policy Development. This article was first published in the Huffington Post on 26 November 2015.

  • Bullying and bugging in East Timor.

    The bugging by Australian Security Intelligence Service (ASIS) of an East Timorese cabinet meeting in 2004 will not go away. The event was so outrageous it is not surprising that it continues to resurface. Only a Royal Commission or a Judicial Review can redress some of the damage that has been done to Australia’s reputation, our intelligence agencies and most importantly of all, in our relations with our near neighbour, East Timor.

    There have been new revelations and continual cover-ups. As Senator Nick Xenophon has said on the ABC ‘This is a massive scandal”.

    I continue to be concerned about the competence of our intelligence services and the inability of all Australian governments to effectively supervise their secret operations. The supervising agency is too small to be effective. My experience is also that the supervisors including parliamentary committees, become part of the ‘intelligence club’. Journalists and so called academics ‘experts’ who report on our intelligence services are also invariably part of the same club.

    Our intelligence agencies have greatly expanded resources and powers but it is very hard to assess their competence. The bugging in East Timor, even though eleven years ago, remains a blight.

    See link below to ABC interview with Emma Alberici and Senator Nick Xenophon.

     

    http://www.abc.net.au/lateline/content/2015/s4361657.htm

  • Joanna Thyer. When we are not sure, we are alive.

    What do Pope Francis, Thomas Merton and Graham Greene have in common?

    Like Pope Francis, Thomas Merton and Graham Greene were individuals whose sheer complexity equipped them to address the often contradictory world we live in, in order to find God in it.

    The writer and Trappist monk Thomas Merton, the famous British writer, Graham Greene, and our current pope, Pope Francis, have a lot in common. Merton died in 1968 – from accidental electrocution whilst touring in Thailand, and Greene died peacefully in 1991. Both men were converts to Catholicism. Like Pope Francis, Merton engaged in interfaith dialogue. What these three men have in common, however, is that their works reveal them to be visionaries and mystics with a faith message for the world, a message that does not shy away from naming and engaging with the darkness around us.

    Graham Greene led an eclectic life, and embraced and dialogued with the complex world around him. After his conversion to Catholicism in the 1920s, he was commissioned to go to Mexico to report on religious persecution there which resulted in him writing one of his famous novels, The Power and the Glory. He was adept at characterising the flawed broken priest or individual who could still bring Christ to others, despite his brokenness. The internal struggle of the soul to find and receive grace was amongst the issues that consumed him. As he so well depicted in another work, The Heart of the Matter, he understood the paradox of how a person’s conscience and love of God, could also lead them to disaster.

    Greene confronted and explored the world of international politics, espionage and the world of corruption, (he worked for MI6 at one stage). He took a stand on moral issues – he allegedly quit the American Academy of Arts and Letters over America’s involvement in the Vietnam War.

    A serial adulterer and womaniser, he explored flawed and complex interpersonal relationships in his writing, such as in his famous work, The End of the Affair. He was by his own admission, a man who struggled with his own sins whilst balancing a passionate faith. Able to deepen and challenge his own religious and spiritual beliefs amidst a rich and tumultuous life, his flawed and complex nature both informed his writing, and furthered his faith as a devout Catholic.

    Both Merton and Greene struggled with the dynamics of interpersonal relationships and the struggle between the human soul, desire and what God’s direction and actions in a person’s life and the world around them, meant. Merton was also flawed, and allegedly quite headstrong in his inner and outer battles, and in his relationship with his monastic community. Books about Merton have been written saying he was not as ‘holy’ as he seemed and his personal diaries also talk about the love affair he had with a nurse for a while during his time as a monk in the 1960s. Yet these revelations are indications of a multi-faceted individual whose humanity fuelled his wisdom. Like Greene, Merton’s life experience and the wisdom he imparted to the world, enriched his faith. This is an example to all of us.

    Like Pope Francis, Merton saw the great wisdom of the Tibetan Buddhist and Hindu traditions, or metaphorically how ‘the sun sets in the East’. Whilst some have critiqued this perceived duality in Merton towards the end of his life, it reveals the depth of his quest to follow where God was leading him. Ironically, only days before his death in Bangkok, Merton had an epiphany whilst reflecting on the beauty of Eastern spiritual experience. In contemplating the ‘dharmahaya’ where ‘everything is emptiness and everything is compassion’ he reflected: “I have now seen and have pierced through the surface and have got beyond the shadow and the disguise”.

    In his book Church of Mercy, Pope Francis advises us to read the signs of God in our lives, be guided by the Spirit, and go beyond our comfort zone. Pope Francis’ washing of a female Muslim prisoner’s feet early in his pontificate is a dramatic example of how actions speak louder than words. The subtext of that action could readily be understood as demonstrating how Christ’s love really works. He has not played it safe. He understands the world he is in, and does not separate himself from it. His message is a metaphor for an individual’s spiritual life. He does not want a closed Church, but an open one, and emphasises that “a bruised Church is better than an ill Church”.

    Like Pope Francis, Greene and Merton were individuals whose sheer complexity equipped them to address the often contradictory world we live in, in order to find God in it. The lives of such people do not make them saints, yet they do exemplify their status as mystics who contribute to the spiritual development of others.

    At a time when religious persecution is rife, when extremists on either side have hijacked and distorted many religious beliefs, in a violent, chaotic and often uncertain world, the lives of people like Pope Francis, Thomas Merton and Graham Greene have a message for us: to embrace the brokenness in the world and in our own lives and find love and God in it. Their message seems to embody what Graham Greene once famously said, “When we are not sure, we are alive”.

    Joanna Thyer is a writer, Sydney hospital chaplain, and educator. Her most recent work is 12 Steps to Spiritual Freedom, (Loyola Press, 2014). Source:

    http://www.goodsams.org.au/good-oil/what-do-pope-francis-thomas-merton-and-graham-greene-have-in-common

    This article was first published in the November 2015 edition of The Good Oil, the e-magazine of the Good Samaritan Sisters http://www.goodsams.org.au/good-oil/what-do-pope-francis-thomas-merton-and-graham-greene-have-in-common

  • John Thompson. The costly abolition of Medicare Locals

    Despite promising to keep Medicare Locals, the Abbott government abolished the fledgling organisations after it took office.

    Even when it had no clear policies or plans to replace them, the Abbott government seemed determined to undo many of the initiatives of the previous Labor government. This was certainly the case in relation to primary health care.

    In 2008, the then Labor government established the National Health and Hospital Reform Commission(link is external) (NHHRC) to conduct a comprehensive review of Australia’s health system. The review provided the basis for the National Health Reform Agreement (NHRA) signed by the Australian government and the states and territories in August 2011. The reforms set out in the NHRA had three main objectives:

    1. Reforming the fundamentals of our health and hospital system, including funding and governance, to provide a sustainable foundation for providing better services now and in the future.
    2. Changing the way health services are delivered, through better access to high quality integrated care designed around the needs of patients, and a greater focus on prevention, early intervention and the provision of care outside of hospitals.
    3. Providing better care and better access to services for patients, through increased investments to provide better hospitals, improved infrastructure, and more doctors and nurses.

    The establishment of 61 Medicare Locals across Australia was one of the key initiatives taken to address these objectives.These regional structures aimed to strengthen the primary care system (and thereby relieve pressure on hospitals and other acute providers) by integrating Commonwealth and state government health planning and service delivery and access.

    Medicare Locals were non-profit companies selected after a competitive application process and funded largely by the Commonwealth with $1.8 billion for the period 2011–12 to 2015–16. While the Commonwealth funding deed specified program schedules and reporting requirements, Medicare Locals were provided with considerable scope to arrange their structure, operations and relationships to reflect their local health environment.

    To provide this focus on primary care, Medicare Locals were required “to work with the full spectrum of general practice, allied health and community health care providers and improve access to care and drive integration between services.” They established collaboration with health care services and other community organisations in their region to develop strategies to meet the overall primary health care needs of their communities. Considerable effort was made to ensure that general practice had a central role in the work of Medicare Locals – with varying effectiveness.

    Medicare Locals worked at a regional level with state and local government in the planning of primary health care services and in the linking of these services with Local Hospital Networks and aged care programs to deliver improved integration and effective transitions for patients across the entire health care system.

    The Medicare Locals program was a contentious one, not just because it was a Labor government initiative, but many GPs saw it as a threat to their primacy in their local primary care market and saw the regional health planning activities of the Medicare Locals as an unnecessary additional layer of bureaucracy. This negative view was reinforced by the AMA, the doctors’ union, that lobbied the Coalition Opposition on the basis of the perceived threat to the GP small businesses. For this reason, the Coalition went to the 2013 election with a health policy that included brief mention of Medicare Locals as follows: “We will also review the Medicare Locals structure to ensure that funding is being spent as effectively as possible to support frontline services rather than administration.” However, the then Opposition Leader, Tony Abbott, made a promise that no Medicare Locals would be closed should the Coalition form government.

    About a month after coming into office, the new Minister for Health, Peter Dutton, announced a review(link is external) of Medicare Locals to be conducted by Professor John Horvath. The review was aimed at “reducing waste and spending on administration and bureaucracy, so that greater investment can be made in services that directly benefit patients and support health professionals who deliver those services to patients.” Comments from selected “stakeholders” were invited.

    Professor Horvath, previously Chief Medical Officer, was assisted in the review by two consulting firms: Ernst & Young provided advice on the current operations of Medicare Locals and future structure and governance options, and Deloitte Touche Tohmatsu (Deloitte), conducted an assessment of their financial performance and compliance to their Deed.

    The conduct of the review attracted substantial criticism, particularly for its lack of transparency. A Senate committee subsequently reported(link is external) that it had not been able to obtain much definitive information about the process and methodology used to conduct the review.

    More than 270 submissions were received, indicating a high level of interest in the review, but none was made available by the Department of Health or as supporting documents with the review as is the usual case. Horvath advised that he “personally conducted” interviews with key stakeholders but did not identify who they were. A small number of Medicare Locals were asked for input to the review but were restricted in the amount of information they could provide.

    It is understood that the Deloitte audit involved what the Department of Health called “a basic review” of the 2012–13 operations of the Medicare Locals functioning at that time, with a more considered audit of six of the 61 Medicare Locals. As most Medicare Locals had only just begun operating (setting up structures, employing staff, developing IT systems, etc.), it is not surprising that their audited financial and other achievements were not substantial, and the auditors were not interested in the future plans of the Medicare Locals.

    The review was completed in March 2014 and was highly critical of the performance of the Medicare Locals. Itrecommended(link is external) that the recently established Medicare Local system (one third of the Medicare Locals were only established as from July 2012) be replaced with a system comprising a smaller number of regional organisations called Primary Health Organisations.

    The Senate committee referred to above reported: “With limited information available publicly, and no detailed discussion of methodology in the Review report, it is difficult to understand the Review’s recommendations. Similarly, without the transparency that would have been achieved by the publication of the consultancy reports and the 270 submissions, the Review’s assertions that the Medicare Locals are ‘flawed’ cannot be tested.” The Senate Committee also stated that it could not reconcile the positive evidence it heard of the progress and achievements of Medicare Locals with the highly critical and negative findings of Horvath’s review of the work of the Medicare Locals.

    Notwithstandinga clear public statement by Tony Abbott that no Medicare Locals would be closed should the Coalition form government, when his government brought down the 2014-15 Budget in May 2014 it was announced that all Medicare Locals would cease operation on 30 June 2015 and a new network of Primary Health Networks(link is external) (PHNs) would be established.

    There have been substantial costs incurred in the closure of the 61newly established Medicare Locals, both financial and in terms of disruption or termination of valuable health services. In a relatively short time, boards had been established, staff had been recruited, premises and operating resources were acquired, relationships and collaborations established with local health organisations, and services and programs initiated. On the basis of government commitments, the Medicare Locals had entered into contracts, leases and employment obligations.

    The costs of winding up the Medicare Locals have been estimated at between $112 million to $200 million. The Health Department admitted that closing Medicare Locals would cost $112 million but refused a Freedom of Information request for details of this estimate claiming it would not be in the public interest to release these figures because it could jeopardise “its good relationship with Medicare Locals.” However, many Medicare Locals showed no reluctance to publicly announce their wind up costs at the Senate Committee hearing. The Barwon Medicare Local estimated their costs at $2 million; the North Adelaide Medicare Local’s estimated costs were $2.2 million.

    Skilled, and often very scarce, staff were lost as they became aware of the uncertainty of their future employment. These staff losses were felt most keenly in non-metropolitan areas where health workers are often difficult to find.

    Perhaps more crucially, many highly needed health services that had been recently begun were terminated.Although in their early stage of operation, Medicare Locals had established or funded a range of vital services, made important advances in population health, identified and filled key gaps in services, and begun the critical task of integrating primary care with hospital services. This momentum was lost and many communities lost the gains made. Furthermore, key health staff were lost, a particularly important factor in rural and remote areas.

    The Department of Health then announced that the new PHNs would be selected on the basis of a public tender process so that the new organisations could begin operations on 1 July 2015. This tender process was very poorly managed by the Department.

    The notice of tender for the PHN Program was issued on 28 November 2014, almost a month after the previously advised scheduled release date. The tender period was very short and conducted over the Christmas–New Year period with tenders to be submitted by 28 January 2015.This was an absurdly short time for major organisational relationships to be established and business structures and financial decisions to be made, particularly as the minister encouraged new private sector interests to participate.

    Although broad guidelines were provided to potential tenderers at the start of the process, major decisions and criteria such as the geographic boundaries of the proposed PHNs were drip fed to interested tenderers as the tenders were being prepared.

    State government officials advised that there was very little consultation with the key state health agencies to recognise and capitalise on existing health planning and coordination bodies.

    Information meetings for prospective tenderers were conducted in each state by Department of Health officials but the information provided was no more than that which already available on the Department’s website. The Department even refused to provide notes of the meetings or lists of attendees (which would have been of assistance to facilitate collaboration in the preparation of tenders).

    Horvarth’s review criticised Medicare Locals for focussing too much on service delivery, not entirely coincidentally a concern of GPs and other providers. His report recommended that PHNs “should only provide services where there is demonstrable market failure, significant economies of scale or absence of services”. However, he did not define “market failure” and the Department clearly had difficulty in providing potential tenderers any reasonable clarity on this matter. This certainly made the preparation of submissions very difficult, especially for tenderers in rural and regional areas where Medicare Locals had provided services to meet significant gaps in services.

    In summary, the tender process was very deficient. The Senate Committee noted the confusion surrounding the tender process and considered “flaws in the government’s PHN tender process raises doubts regarding any outcome of the tender process.”

    It is not surprising that about this time a poll of more than 1100 doctors across Australia conducted by the AMA declared the Minister for Health, Peter Dutton MP, the worst Minister for Health for 35 years.

    In April 2015 the Commonwealth government announced that 31 PHNs would be funded as from 1 July 2015. They would be required to establish Clinical Councils involving GPs, and Consumer Advisory Committees. Announcing the successful bidders, the Minister of Health, Sussan Ley, said the new PHNs would replace “Labor’s flawed Medicare Local system,” yet almost all PHNs selected (24 of the 28 PHNs) are either consortia of former Medicare Locals or have a Medicare Local as the lead applicant.

    The new PHNs will be responsible for populations and geographic areas that are much larger than those of the Medicare Locals. (For example, one PHN will now be responsible for all of Western Australia except the Perth metropolitan area.) Medicare Locals had an average population of 355,000; PHNs will service an average population of 738,000. Six PHNs will service populations of more than one million. Many health experts doubt the effectiveness and efficiency of such very large organisations, citing the failure of the NSW government’s establishment of mega health services.

    The substantial costs of establishing these new organisations are not known and it will be interesting to discover their operating costs when their first financial reports are made.

    The concerns of the Senate Committee that the inadequate Horvarth review and the Department’s inept tender process could lead to a poor result appear to be justified. Now, several months after the PHNs were formally established, there has been little progress in developing any useful operations. Many in the health system are of the view that the whole exercise is a very expensive ideological move that, despite very substantial financial resources and lengthy disruption and dislocation, may not achieve the results that the fledgling Medicare Locals were beginning to realise.

    John Thompson is an economist with experience in primary health. This article was first published in Australian Policy Online on 23 November 2015.

  • Victoria Rollison. Couples counselling for Labor and Unions

    When I saw the news that the Electrical Trades Union invited the Greens’ Adam Bandt to address their National Officers conference, and didn’t invite a speaker from the Labor Party, the lyrics of Gloria Gaynor’s “I Will Survive” came to mind: ‘I’m not that chained up little person still in love with you, and so you felt like dropping in and just expect me to be free, and now I’m saving all my loving for someone who’s loving me’. This is not a lovers’ spat. The ETU has felt unloved by the Labor Party for a long time. In 2010, the union’s members made their displeasure official through a public, conscious uncoupling. As explained on the ETU website ‘our-history’ page: ‘The mood of the ETU membership towards the Labor Party has changed. The members no longer have faith in the Labor Party to listen to and act in the best interests of workers. The argument put forward is that political parties only listen to swinging voters. To that end, in 2010 the ETU membership voted to step away from its affiliation with the ALP and support whichever voice in the Parliament speaks genuinely for the workers’.

    Such a statement barely skims the surface of the complicated relationship between the Labor Party and the Australian trade union movement. Whereas some unions are un-affiliated, others are loved up and as cosy as ever, and continue to provide a well-trodden path into the federal Labor caucus. As pointed out by Professor Ray Markey: ‘Only 11 unions account for all federal Labor parliamentarians with union backgrounds, nine of which are affiliated to the party. Almost half of these 39 MPs come from three affiliates: the Shop Distributive and Allied Industries Union (eight), Transport Workers’ Union (five) and Australian Services Union (five)’. And of course, Labor leader Bill Shorten has a well-known union background in the Australian Workers Union.

    The question for both Labor and Australian unions is, are they good for each other? Will their relationship continue to be mutually beneficial to both parties, or should they go their separate ways?

    There is no simple answer to this question. In recent years, there have been triumphs for the relationship, and inevitable tensions. The triumphs include the union’s campaign against WorkChoices which contributed to Labor’s election win in Kevin-07. Union campaigns were also influential in the election of Queensland Premier, Labor’s Annastacia Palaszczuk. As explained in this interview with Peter Simpson, Queensland state secretary of the ETU union, the ETU, though not an affiliated union, mobilised a grassroots ‘Not 4 Sale’ campaign against public asset sales. Many other unions helped not just with campaign funds, but also with on-the-ground activities such as door knocking and phone calls. In her victory speech, Palaszczuk shared the love by saying: ‘Can I thank the union movement … Because it is the union movement that stands up each and every day and fights for better conditions for workers across this state.’

    Still, whereas the good times are good, the bad times are terrible. In working towards Party reform, Labor has slowly been unpicking their strong – some consider stifling – union links. For instance, in an effort to increase the accessibility to the party and the diversity of Labor rank-and-file membership, it is no longer compulsory for applicants to be a member of a trade union. Senator John Faulkner campaigned to reduce union representation at state conferences from half to 20%. Labor’s National President and Shadow Climate Change Minister, Mark Butler, is also pushing to increase rank-and-file decision making and reduce unions’ disproportionate voting rights. Since 2010, Labor has implied they are happy to date other people by describing their relationship with unions as ‘links’ amongst ‘other community organisations’. This is a far more casual relationship than 2002 when Labor described their union relationship status as a ‘partnership’.

    Any end to the relationship would be costly for Labor. John Warhurst says Labor ‘depends hugely upon the unions financially, not just through the regular flow of money for daily administration, but for election campaign expenditure and broader pre-election political campaigns…’ But with this money comes an expectation of influence, an influence many non-union Labor rank and file members and supporters see as ‘authoritarian, anti-democratic, sometimes corrupt and with power held by factions and “faceless men”’.

    Policy disagreements are also an unavoidable source of tension between Labor and unions. A recent example is the disappointment felt by unions about Labor’s deal with Turnbull’s government accepting the China Free Trade Agreement, albeit with some amendments. ACTU President Ged Kearney was quoted as saying ‘companies would still be able to source workers from overseas without offering jobs to local citizens and residents’ and ‘While we appreciate the efforts of Penny Wong and Bill Shorten to fix a bad deal, the proposed changes simply do not go far enough’.

    All of these complications inside Labor and unions’ relationship are amplified by the Liberal Party’s ideological war against unions, and by association, Labor. Speaking about his Royal Commission into Trade Union Governance and Corruption in Parliament on 8 September 2015, former Liberal Prime Minister Tony Abbott claimed the commission was set up ‘because it was absolutely necessary to get to the bottom of rorts, rackets and rip-offs, of corruption and of criminality inside the trade union movement’. This depiction of unions as corrupt and criminal is regularly repeated in news stories, particularly in right-wing partisan press, framing any Labor MP with links to unions as untrustworthy. Overcoming such attacks, and defending their public reputation, is a crucial activity Labor and unions must cooperate in.

    If Labor and unions are to remain together, they need to be honest about how each has changed since they first met, and agree to compromise, as any couple who have a long history must do. Unions are operating in a vastly different economy and with a shifting and declining membership base, with ever-changing IR policy challenges to contend with. Labor is often stuck between a positive reform agenda rock and a populist electorally viable hard place, so won’t always be able to accommodate all unions all the time. Of course everyone must acknowledge that Labor can’t be progressively productive, and defend against the right’s attacks on IR policy, without winning elections.

    There is so much good about the relationship, I’m sure it’s not something either want to destroy completely. And even if the unlikely decision is made for Labor and unions to cut ties and file for divorce, I would hope they can agree to be cordial for the benefit of the children; for the benefit of everyone who relies on unions and the Labor Party to defend the rights of workers, to deliver socially progressive policies and to maintain economically equitable and sustainable economic growth.

    Victoria Rollison is a political blogger. She works in marketing and communications and is researching political narrative at the University of South Australia. She is a member of the ALP in Adelaide.

     

  • Arja Keski-Nummi   Andaman Disaster – Regional Cooperation on Refugees

    Too often in Australia we go cap in hand to the region when we have an asylum seeker or refugee problem. When our problems pass, we lose interest in regional cooperation. No wonder the region often see us as fair-weather friends.

    But our region faces refugee problems alongside ours. As a good neighbour we should help with the common problems we face. It is in our interest to do so as well as in the interest of regional countries.

    On 13 November 2015, the Huffington Post carried a story that “Myanmar’s Rohingya could be the world’s next major refugee crisis”.  The story commented

    ‘After months of monsoon rains, it is sailing season again in the South Seas of Myanmar. Six months ago, the plight of Myanmar’s Rohingya minority briefly garnered international attention when they were among thousands of starving refugees and migrants abandoned in the Andaman Sea and the Bay of Bengal. Human Rights groups now say a new refugee crisis looms, as members of the Rohingya minority are excluded from the dramatic reforms taking place in their country. Amnesty International recently warned that thousands more people could set sail in the coming months, risking a repeat of the May crisis.’

    John Menadue.

    See below a post by Arja Keski-Nummi on the earlier Andaman disaster.

    The crisis in the Andaman Sea provides an opportunity for the Australian Government through our Foreign Minister Julie Bishop as Co-chair of the Bali Process on People Smuggling, Trafficking and Related Transnational Crime to give the process some teeth and credibility in the region. This is a good opportunity for us to help others just as they have helped us in the past with regard to people movements.

    Five countries that are part of the Bali Process are facing a crisis that is drawing negatively the attention of the international community on the region; unprecedented since the Indo Chinese outflows of three decades ago.

    Australia should be approaching the other Co-chair, Indonesia, to work with affected countries in examining what can be done to both tackle the people smuggling/trafficking ventures that are preying on vulnerable people in Bangladesh and Myanmar and how best to ensure the safety and security of people who have been affected by such predatory behaviour.  In its 2013 communiqué ministers “underscored the importance of addressing humanitarian and protection needs in managing irregular movement”.

    Now is the time to enliven the April 2013 communiqué of the Bali Process Ministerial meeting in which in its penultimate paragraph:

    “Ministers recognised that the root cause of irregular movements in the region were complex and multidimensional and encouraged members to continue to work with countries of origin, including through development cooperation, to address where possible underlying factors which made people vulnerable to irregular movement.” 

    This communiqué called for greater regional cooperation and work on:

    • People smuggling and trafficking. From the reporting we have seen on this latest humanitarian disaster a people smuggling venture has quickly turned into trafficking.
    • Development of a “protection-sensitive regional approach” – the aspirations of which are to have consistent assessment processes for asylum seekers, and where appropriate and possible harmonised arrangements or the establishment of regional assessment arrangements.
    • Identifying in the region the perceived increase of labour trafficking and how this might be tackled by working with civil society groups and business.
    • Working with countries to address the root causes of such movements

    All of these concerns are present in the current situation of the people on the boats in the Andaman Sea.

    We should with our Co-chair seek to convene a special high-level ad-hoc group under the Bali Process banner to pull together a practical cooperative action plan that would provide assurances to affected destination countries that the burden is not theirs alone.  This group could comprise the five affected countries, Australia as co-chair and the three international agencies UNHCR, IOM and UNODC.

    Such assistance could include:

    In Destination Countries:

    • Assistance with initial screening and identification of people with protection concerns or who are victims of trafficking. A multinational task force (comprising nationals of destination countries as well as other Bali Process countries such as Australia and new Zealand) led by UNHCR to undertake that initial screening,
    • Flying in emergency assistance for shelter and medical support with the agreement of affected countries
    • Creation of safe havens pending final determinations –where the burden of costs is shared.
    • Assistance with local integration in certain circumstances through regional social investment projects in housing, health and education services that benefit the indigenous communities as well as new arrivals.
    • Commitments to resettlement of recognised refugees over a period of time.
    • Greater support for return through assistance in innovative new labour creation projects through social investment projects and micro financing schemes.

    In Source Countries:

    For the Rohingya the solution lies with Myanmar conforming to international norms in relation to the treatment of its citizens.  While Myanmar does not recognize the citizenship of a segment of its population and actively discriminates against them through property, education, movement and marriage laws this situation will continue.  The solutions have to lie in policy changes with the Myanmar government. As Myanmar emerges out of its self-imposed isolation regional institutions such as ASEAN have the opportunity to provide a constructive environment within which Myanmar can address the policy problems of this issue.  Complementary to this an ad hoc group as proposed above could provide practical assistance to ASEAN in mapping out strategies for supporting Myanmar in improving the conditions of Rohingya in Myanmar.

    Bangladesh has been a source of labour migration for decades.   Traffickers prey on the vulnerabilities of people desperate for work where there is none. Overpopulation, corruption, lack of opportunities, international demand for cheap labour all play into the hands of traffickers.  There is no easy solution to this cocktail of misery compounded by a lack of political stability in Bangladesh. While the Bangladesh Government has created a legal and administrative infrastructure to combat trafficking – “The Human Trafficking Deterrence and Suppression Act 2012” and the “National Plan of Action for Combating Human Trafficking for 2012 – 2014” and coming out of these instruments established a number of different strategies covering training, awareness and education as well as greater law enforcement measures, the problem remains overwhelming. According to the 2014 US Department of State Trafficking in Person Report, of 215 cases initiated for prosecution in 2013, a total of fourteen people were convicted of trafficking.  There are no reliable figures on how many people were trafficked in this time but conservative estimates put it in the tens of thousands. Given these most recent developments, a Bali ad-hoc group with Bangladesh as an active participant can continue a process of working with Bangladesh in strengthening the strategies it has in place and working with civil society in the country in providing protections and safe haven for people at risk of being trafficked.

    Smugglers and Traffickers – the raison d’etre of the Bali Process is to combat People Smuggling and Trafficking. Despite many countries in the region enacting laws against people smuggling and trafficking and the imposition of ever-greater penalties for smuggling and trafficking it remains one of the more lucrative and risk free ventures in the region.  Tackling this through laws and awareness campaigns while important is not enough. These loose coalitions of interest groups and syndicates are like a many-headed hydra quickly adapting and changing techniques and operations to prevailing conditions. Again the issue must be tackled at its source – in this instance most likely Bangladesh. The proposed ad hoc group could start the development of a strategy to support Bangladesh and other countries named in the US State Department TIP reports to strengthen its approaches against traffickers and recruiters and the victim of smugglers and traffickers.

    This is a global problem, which will only increase, and we cannot isolate ourselves from it. While for the time being Australia may have stopped the boats – this policy is not sustainable into the longer term. It is in our national and regional security interests to help stabilize populations and to play our part in the region. 

    Arja Keski-Nummi was formerly First Assistant Secretary in charge of refugees in the Department of Immigration and Citizenship.

  • Victoria Rollison. The Future of Australia’s Trade Unions

    A strong trade union movement is crucial to combating growing wealth inequality in the Australian economy.

    When asked in 2014 what Australia ‘had done right’ to defend the economy against the chronic wealth inequality experienced in the US, Nobel Prize winning economist Joseph Stiglitz answered: ‘unions’. He explained that Australia has ‘been able to maintain stronger trade unions than the United States. The absence of any protection for workers, any bargaining power, has had adverse effects in the United States. You [Australia] have a minimum wage of around $15 an hour. We [the US] have a minimum wage of $8 an hour. That pulls down our entire wage structure’.

    Regardless of their comparative strength to unions in the US, Australian unions cannot afford to be complacent about their long term survival.

    Recent data from the Australian Bureau of Statistics, as analysed in The Guardian by Greg Jericho, paint a worrying picture for the Australian trade union movement. Jericho reports that ‘trade union membership in the private sector is now almost one in 10… And in a sign of further strife for the union movement, just one in 20 young workers are in a trade union’. The public sector (39.5%) and education (34.38%) industries have the highest percentage of trade union membership, but as the number of workers in traditionally strong union industries such as manufacturing decline, so too does union membership, particularly amongst male workers. In fact, Jericho points out, whereas men used to be more likely to be union members, women now make up a higher percentage of union members, with 15.9% of female workers members of a union as compared to 14.4% of men. The total percentage of trade union members in the Australian workforce is now 15.1%, and only 13.8% if you include workers in unincorporated enterprises. This compares to 40.5% in 1990.

    Commenting on these figures, former ACTU official, Tim Lyons    , says ‘Australian unions have only a few years to change or die’. Lyons is reported as blaming the ‘historic collapse in union membership’ on ‘an outdated approach that does not work across large parts of the workforce’, and admits the blame is shared by him as a ‘former senior ACTU officer’. He says that too often, unions are seen as only being concerned with their position in the political sphere and that ‘Political campaigning can’t ever be an excuse for not organising’. He goes on to argue that ‘The need for new models of membership and worker participation is long overdue’. Offering a potential way forward, Lyons suggests; ‘Strong, growing unions are ones that help give workers some power over their work and therefore their lives. There are no shortage of workplace issues to organise around, with penalty rates being only the most obvious’. Lyons sees unions’ futures in re-evaluating their value to workers and helping workers organise to help themselves, with less emphasis on political campaigning.

    Amongst their assessments of the declining membership of Australian unions, Jericho and Lyons comment on some more positive news for unions by citing polling released recently in Essential Media’s Essential Report, October 27 2015. The poll asked ‘How important are unions for Australian working people today?’ and found ‘The majority of respondents regarded unions to be important for Australian working people today (62%), whilst 28% believe that they were not important’.

    Ged Kearney, President of the ACTU, responded to the ABS’s declining union membership figures by pointing out that ‘while union membership density is hovering around 15% of workers, more than 60% of Australian workers are employed under conditions that were collectively bargained for’ and ‘Even for workers not covered by collective agreements, they still directly benefit from their broad acceptance. The ubiquitousness of such agreements has led to them becoming the de facto base rate across much of the workforce, rather than the relevant award’.

    The challenge for Australian unions is to translate the belief amongst workers of the importance of the role of unions, and the reality of unions’ benefit to wage growth, into a belief that union membership is a valuable investment for workers’ individual job conditions. A strong, united workers’ trade union movement is the best line of defence, as pointed out by Stiglitz, to defend against growing economic wealth inequality.

    Victoria Rollison is a political blogger, working in marketing and communications. This article first appeared in ‘Equality, a journal of Australian Fabians’.

  • Rob Nicholls. Ziggy’s stardust: The NBN, net neutrality and competitive neutrality

    The sound of an incumbent lobbying has the grating element of petulant mewling. When the incumbent is a state owned enterprise that is evoking arguments about net neutrality, then it’s time to ask the “cui bono?” or “to whose profit?” question. After all, the term “network neutrality” can be best summed up as a line of argument use by large businesses in their lobbying.

    In this case, it was the chair of the National Broadband Network Company, a business that likes to be known by its lower case initials nbn, that was flying the net neutrality kite. Ziggy Switkowski argued that it might be time to think about who should bear the cost of transporting streaming video from companies such as Netflix, Presto and Stan. Specifically, should the internet service provider (ISP) be able to charge Netflix and others for some of the carriage costs that it incurs? Ziggy also mentioned that access to nbn’s network might be more expensive to smaller ISPs.

    This might be a reasonable question to ask. The speech was on 16 November and attracted comments from the electronic trade press on the day and was covered by Fairfax on 23 November. Of itself, this suggests that nbn wants the question asked. However, the issue has much less to do with net neutrality that it does with the Chair of nbn seeking to change the scope of the company’s business. nbn is constrained by the shareholder ministers’ wishes expressed in a Statement of Expectations and its regulatory constraints which are imposed by law and nbn’s own Special Access Undertaking, that it gave to the ACCC. These assume that retail providers connect to nbn’s network at one or more of the 121 points of interconnection to nbn’s network. In doing so, the retail provider pays a two part tariff reflecting both the connection bit rate and the volume. The volume component is the Connectivity Virtual Circuit (CVC). This is a pure pricing construct, as there is no underlying cost for the CVC.

    The problem for Ziggy is that Australian internet users, in common with internet users all over the world, want to download more content. In doing so, they make the interconnection to nbn’s network look increasingly expensive at no additional cost to nbn. However, Ziggy’s argument on network neutrality harks back to an older era. For a start, each of the major providers of content pay for their own carriage across the Pacific. ISPs can interconnect with Netflix, Google (for YouTube) and Facebook in Sydney or Melbourne. Second, there are extensive content distribution networks to deliver the content closer to the points of interconnection and the use of these networks is paid for by the content providers. Netflix also offers ISPs the option of a no cost cache if they generate a great deal of traffic to a particular area. This Netflix Open Connect Appliance could logically sit at each of nbn’s points of interconnection (on the customer side of the CVC toll point) and Ziggy’s network neutrality issue would be resolved.

    But nbn actually wants to change its operating environment by competing with existing infrastructure providers. The argument that the smallest ISPs cannot afford to connect at every interconnection point sounds like a problem. It is not. The large infrastructure providers offer carriage services to the ISPs on a wholesale basis. However, the effect of this is also to magnify the nbn’s odd CVC pricing arrangements. Instead of letting private sector competitors provide services, the state owned enterprise would rather provide the carriage itself. This has the convenient effect of masking the CVC problem and the inconvenient consequence of lessening competition among private sector actors.

    The concept of competitive neutrality, with its origins in NSW state policy of the late eighties, its codification as a consequence of the Hilmer Review in 1993 and its role as the centrepiece of the proposals of the Harper Review last year, is a critical part of competition policy in Australia. If a state owned enterprise in another country argued that consumer demand was driving its actions in contradiction to the principles of competitive neutrality, Australian businesses would rightly complain. Using the the thin veil of network neutrality to try to justify breaching the principle when the solution to the problem is for nbn to change its pricing approach is not easily forgivable. Perhaps, like the album by David Bowie’s alter ego “Ziggy Stardust”, this line of argument should be released once and not be repeated.

    Dr Rob Nicholls is Lecturer, School of Taxation and Business Law, UNSW Business School.

  • Francis Sullivan. Learning As We Go: The Pope Models the Change the Church Needs

    Francis Sullivan ABC Religion and Ethics 12 Nov 2015 

    Ever since the conclusion of the recent Synod in Rome, I have been thinking about the signals of change that Pope Francis is sending. He does it in words and by his disposition.

    Observers at the Synod frequently commented on the informal and casual style of the Pope. He mixed easily and readily with participants. He didn’t stand on ceremony and was eager for a chat – more a “first among equals” than some sovereign ruler.

    This in itself is a marked difference from previous popes. He personifies what he extols: openness, inclusion and “learning as we go.”

    It’s not hard to see how such a disposition pays dividends in a world in which the search for truth and meaning can seem so clouded and even crowded out with competing voices, philosophies and ideologies. The fact that Francis doesn’t purport to “have it all sorted” only deepens his appeal to the rest of us who struggle at times to find certainty and a sure path in life.

    Pope Francis has a mantra. He speaks often of the mercy of God, not divine judgement. He wants to remind us of the importance of the human heart, the innate urge to feel for others, understand their plight and seek to help. He wants us to see this as the first and most important of the human responses. This is a disposition that builds bridges and heals wounds; a perspective that seeks to restore relationships, nourish people and promote harmony, not division.

    Only this week he spoke of a Church unafraid to question itself, live with doubts and the discomfort of interrogating its assumptions; a place of dialogue, with a willingness to embrace the new and the awkward. A church that seeks to reform through becoming unsettled, unsure but close to people, their circumstances, sense of isolation and travail. A church more like a meeting square than a brick bastion.

    This reminds me of what Simone Weil meant by paying attention. She said that in order to get a sense of what is true we need to suspend our own agenda and concerns and shift the focus of our attention on to that we encounter. In so doing, the truth of that encounter, that dynamic within the dialogue, will be revealed.

    This is similar to the maxim that listening is the first step towards wisdom. To listen well is to be aware of the voices in ourselves that try to understand another person long before we have actually heard them. Letting go of preconceived perspectives, attitudes and even understandings is the challenge for a pilgrim church if dedication to truth is to be its hallmark.

    The irony is that, in becoming disturbed or, as the Pope puts it, “uncomfortable” – maybe even knocked off course – we are strangely on a pathway more to do with God than any human construct of the Divine.

    At one level, we should not be surprised to hear a pope speak and act like this. The fact that we are surprised speaks volumes for the institutional persona the Church has cultivated in many quarters these days.

    Critics see the Church as being harsh on human nature, uncompromising with its take on the truth and immovable in its attitudes. In its response to child sex abuse, the Church too regularly failed the test of moral leadership, hid behind institutional protectionism and sought to excuse itself as just another institution with some “bad eggs” in the basket.

    It spent too long exhausting institutional resources to justify, contextualise and even rationalise away the problem, rather than in humbly admitting its failures as far up the line as they went. The upshot has been in collapse of trust and the consolidation of the public image of a Church that not only speaks of arrogance and indifference, but that also fails to “feel with” those abused and disenchanted.

    Too often Church officials wanted understanding before they expressed mercy. We didn’t get the problem before it became a tsunami. We didn’t get what victims and their families were saying and the reach of the tentacles of abuse within the Church. We didn’t get the imperative to cry out in shame and seek atonement. And when we did, it looked too late.

    God have mercy!

    Francis Sullivan is CEO of the Truth, Justice and Healing Council, which is coordinating the Catholic Church’s engagement with the Royal Commission into Institutional Responses to Child Sexual Abuse.

     

  • An Open Letter to the Minister for Health concerning Private Health Insurance.

    19 November 2015 

    Hon Sussan Ley M.P.,
    Minister for Health,
    Parliament House,
    ACT 2600

    Dear Minister

    (I have signed this letter on my behalf and also on behalf of the people listed below. I will be posting this ‘open letter’ on my blog early next week.)

    We are pleased to see that you are canvassing community and expert views on private health insurance.

    In discussing the community survey, recently on the ABC Breakfast Program, you said “We support the public system for those who can’t afford private health”.

    That is a long way from the idea of universal mutual support that has underpinned Medicare and public hospital arrangements. It assumes, incorrectly, that private health insurance, and the associated subsidised access to private hospitals, is something Australians see as desirable if only they could afford it.

    As you know, about half of Australians do not hold private health insurance. Many are driven to hold it by the Medicare Levy Surcharge – a coercive instrument that has little to do with choice. You would also be aware that 200 000 taxpayers pay the surcharge, rather than holding private insurance, even though almost all of them would be financially better off taking the cheapest hospital cover.

    For many, the main attraction of public hospitals is not that they are “free”, but rather that they offer a high standard of care. Most importantly the funding system for public hospitals, unlike the funding for private hospitals, does not carry an incentive for over-servicing. There is growing community awareness of the risks of over-diagnosis and of over-servicing.

    Some others, particularly older wealthy people whose income is below the MLS threshold, do the sums and work out that their best bet is to draw on their savings to finance any needed private hospitalisation, secure in the knowledge that if they need acute care they are served by public hospitals. In doing this they miss out on the subsidies, the benefits of which are go to pay for high administrative costs and the cross-subsidies associated with adverse selection. Thanks in part to superannuation, households with people in the 65-74 age range, have on average $500 000 in financial assets.

    It is ironic that, in spite of your Party’s commitment to self-reliance, those who pay for their own private hospitalisation, or who pay their own dental bills, receive no support, while those who hand over responsibility to insurance corporations receive a 30 per cent subsidy or a generous tax incentive in the form of exemption from the MLS.

    Then there are those community-minded people who value the idea of sharing their health care expenses with other Australians. They are morally repulsed by the idea of being corralled into the “gated community” of private health insurance. Also some people, aware of the way “charity” systems inevitably degenerate, see it as important that people with means who hold political influence have a stake in using and maintaining a high standard public hospital system.

    You, and your fellow health ministers in the states and territories, fund and operate an excellent public hospital system. We hope you take pride in a public service that serves all Australians so well, and do not let it degenerate into a charity system.  A way to prevent such degeneration would be to remove private hospitals’ de facto dependence on private insurance, and to bring them into the same funding arrangements as public hospitals, thus allowing them to provide the same high-standard of integrated care as public hospitals, allowing for remuneration models other than individual fee-for-service, and abolishing any suggestion that Australia has two health care systems – one for the affluent and one for those who are less fortunate.

    Yours sincerely,

    John Menadue

    Kerry Goulston, Emeritus Professor, Medicine, USyd
    Ian McAuley, Adjunct Lecturer, Canberra University
    Jennifer Doggett, Health Consultant,
    Stephen Leeder, Emeritus Professor of Public Health and Community Medicine, USyd.
    Karen Willis, Associate Dean, Learning & Teaching, Faculty of Health Sciences, ACU
    Arthur Chesterfield-Evans, Medical Practitioner and anti-tobacco activist
    Sebastian Rosenberg, Senior Lecturer, Brain and Mind Centre, USYD
    Jill White, Professor of Nursing and Midwifery, USYD
    John Dwyer, Emeritus Professor of Medicine, UNSW
    Fiona Armstrong, Executive Director, Climate and Health Alliance
    Tony McBride, President, Australian Health Care Reform Alliance
    Tim Woodruff, Vice President, Doctors’ Reform Society

  • Royal Commissions for some.

    The Abbott government established a Royal Commission to harass trade unions and in the process to damage the ALP. But what we are hearing in this Royal Commission is really small beer by some union hacks. It is small scale compared with the massive tax avoidance by multinational companies in Australia that is being revealed.

    Yet the government has refused to establish a Royal Commission to examine the activities of these multinationals who are depriving Australia of billions of dollars of tax revenue. A Royal Commission would be very useful to flush out this very serious national problem.

    The government has also refused to establish a Royal Commission into large-scale financial advising scandals by the Commonwealth Bank and other financial institutions.

    In the SMH on November 18, Michael West has drawn attention to the government’s attempts to prevent exposure of activities by high income earners. Michael West said

    ‘last week, when two amendments proposed by the Senate to the government’s multinational tax reform bill were unceremoniously dumped by the government the next day. … So determined was the government to help billionaires and multinationals conceal their tax affairs that it killed its own bill. The first amendment, forcing multinationals to file proper (General Purpose) financial statements was to have thrown some light on their inter-company loans and other dealings with offshore associates designed to rip millions out before tax could be paid. The second was the preposterous “kidnapping” amendment which would have ensured greater transparency by billionaires. Both thrown out;  the whole bill nixed, presumably after some 11th hour desperate lobbying by powerful vested interests.’

    John Menadue.

    For Michael West’s full article see link below:

    http://www.smh.com.au/business/comment-and-analysis/the-multinationals-rhetoric-isnt-reassuring-on-tricky-tax-affairs-20151118-gl25c3.html

  • Bruce Wearne. Politics for Government or Politics for Politics?

    At the election of December 1975, the Australian electorate confirmed the sacking of the Whitlam Government. It was an implicit “thumbs up!” to Malcolm Fraser and those on his “side” of politics. Whatever the actual cause of the constitutional crisis that engulfed Australian politics, the result of that election meant an implicit electoral endorsement of the conduct of Malcolm Fraser and his “side” in that crisis. These were the parliamentarians who were elected to get us beyond the political instability they had engineered.

    Well may we remember “It’s time!” Those events of 40 years ago continue to resonate today. The Liberal-Country Party’s theme for that poll was: “Turn on the lights!”? But recent publications indicate that the country been kept in the dark about what went on. There is at least one other “dark secret” that needs to be brought into the light. It concerns the character of the Liberal Party itself.

    By electing Malcolm Fraser’s Coalition Government we were supposedly responding to the bright light that was to be shone on all the dark dealings of Labor’s many-sided economic incompetence. But since then responsibility for Parliamentary budget deficits and fiscal blow-outs have been shared on both sides. And the alert historian of Australian politics will also ask: how can you blame a Government for fiscal mismanagement when they have to live with persistent threats to block supply bills?

    But what was this “other crisis” of those years? After December 1972, Labor controlled the lower house Treasury Benches for the first time in 23 years. We might have expected a “crisis” of sorts among the Labor parliamentarians who must have been used to being in Opposition. Even so, we did not expect that their time in Government would end as it did.

    The Australian people voted for a Whitlam Labor Government not just once (December 1972) but twice (May 1974). After 23 years in Government the members of the Liberal-Country Party coalition were plunged into a deep crisis of their own. They knew how to apply their own party rules and governing principles to their political vocation as Her Majesty’s Government but how were they to conduct themselves as Her Loyal Opposition? It is sad to say the Liberal Party has never really learned to do so. Since losing in 1972 they have persistently seen public government in terms of their side of politics “winning”. When they are Opposition they are “losers”. Bypassing the view of parliamentary democracy enshrined in their own party constitution, they have, like Lemmings, continued to miss the opportunity to form a new style of Opposition, an Opposition for the sake of Government. Such a contribution could have been of great benefit to our parliamentary democracy. But sadly it has never emerged.

    The bumper stickers of the time said of Whitlam “He’s had his chance and he’s stuffed it!” But in truth they come back to stick it on the Liberal-Country Party coalition that failed then, and has continued to do so. Under Snedden and Fraser they reduced their parliamentary task to one political end: winning the election next time. Opposition then meant pragmatic strategic obstructionism.

    There were senior Liberals like John Grey Gorton and Don Chipp who were disgusted with the direction that the parliamentary party had usurped in the party, quite in opposition to what was implied in their party’s constitution. That then was the other “crisis”, the one that was not examined by “turning on the lights”. This is the other persistent crisis that the Australian electorate needs to hear about and discuss.

    The December 1975 election meant that the Australian people effectively endorsed this change in the Liberal Party’s conception of itself. Why should we worry? And those remaining “loyal” to the now “winning is grinning Liberal Party” also thought they need not worry and so they continued on. It would henceforth be a party in which the accountability of its parliamentary wing to the membership would be measured in terms of whether the party was winning elections. No longer was it an accountability to the party’s constitution concerning the way in which Parliamentary democracy requires principled politics, in their case the politics of Liberal principles. No. Now it was not so much a matter of publicly debating policies based on the party’s principles; victory in policy debates could only make sense if the party was either retaining its hold on the Treasury Benches, or moving towards doing so at the next election.

    And this change in the Liberal “side’s” view of its parliamentary contribution has been a decisive factor ever since in our form of parliamentary democracy. It tumbled out with the threat to block supply in May 1974. Since then the rest, as they say, is history, public relations history. The Liberal Party is a political firm for its elected candidates; the idea that it is a party in which elected members are accountable to its rank-and-file to articulate and promote a comprehensive view of public governance according to its constitution’s principles has long gone. This is the pragmatic liberalism that the country has had to endure since 1974.

    Recently we have read of the efforts of the new Prime Minister, Malcolm Turnbull, to hasten publication of the private letters of Sir John Kerr to the Queen. What is his concern? Does this canny politician have some new development in mind for his side of politics? Recent disclosures about the deceitful, if not seditious, manoeuvring of powerful politicians and jurists in bringing about the downfall of the Labor Government could not have escaped his notice.

    But then, Mr. Turnbull has also distanced himself from the actions of Malcolm Fraser in 1975. Could he have concluded that something in the underlying ethical foundations of the Liberal Party has cracked beyond repair, something that the artificial party unity he has long supported simply cannot overcome? Is his attempt to have Sir John Kerr’s correspondence with the Queen made public his attempt to stay ahead of the game?

    So the recent published revelations about the 1975 “crisis” can also help us see how the internal crisis in the Liberal Party in the 1974-1975 years was only seemingly resolved by the election of the Fraser Government. The subsequent 40 years have continued this revolution in the Liberal Party and, as well, we do have a Federal Parliament that is now dominated by contending pragmatic political machines and their aligned public relations firms, and barely a genuine political party is left.

    Obviously there is much more to discuss about restoring political parties to our parliamentary democracy. The question is not just a question for the PM. It is this: is it going to be politics for government or politics for politics? I cannot believe that such a conundrum has not at some point crossed Mr. Turnbull’s wide-ranging Liberal mind. Could he be about to embark upon a “New Liberal Party”, in order to return his side of politics to the ranks of genuine political parties rather than these self-perpetuating electoral machines? Are we going to see Mr. Turnbull try further, from his “side” of politics, to avoid complicity in the substantial political disgrace that occurred with the sacking of the Whitlam Government on November 11th 1975?

     

     

    Bruce Wearne, a PhD in sociology (LaTrobe 1987), lives quietly at Point Lonsdale, in order to contribute to political debate, while also advising students and conversing with the people he meets while walking along the coast.

  • Peter Day. Hatred won’t stop me patting the dog.

    Hatred won’t stop me patting the dog 

    By Peter Day

    New York, London, Bali, Madrid, Israel, Beirut, Egypt, Nigeria, Sydney, Paris:
    on and on it goes, the list of nations and cities left bereft
    after yet another act of terror.

    It puts one’s inner-being out of whack; could even threaten
    to derail one’s sense of humanity.

    Where to from here in the face of such deep seated hatred and barbarity?

    Where to from here as the canopy of powerlessness descends?

    The dog’s snoring in the sun next to my courtyard flyscreen …

    Must remember to keep patting him.

    Must remember to keep hugging those I love.

    Must remember to keep washing the dishes.

    Must remember to keep my head down at golf.

    Must remember to keep in mind that people are worth it.

    Must remember to sit quietly with the Beloved.

    Must remember not to let daily acts of terror undermine simple daily acts – simple daily acts of love.

    Peter Day is a Catholic Priest in Canberra.

     

     

     

  • Thanks to Jake Bailey and Christchurch Boys High School.

    Just one week before his final school assembly, Christchurch Boys High School’s Head Boy, Jake Bailey, was told that he may not have long to live.

    The 18 year old NZ student was bed-ridden and absent from school for three weeks while undergoing treatment for aggressive cancer.

    But during his final school prize-giving ceremony he managed to give an inspirational speech from his wheelchair.

    “None of us get out of life alive, so be gallant, be great, be gracious and be grateful for the opportunities you have” Jake told his audience.

    The school listened in silence as he told of his diagnosis with Burkitts non-Hodgkinson lymphoma, one of the fastest growing tumours.

    See link from The New Daily to story and video of speech below:

     

    http://thenewdaily.com.au/news/2015/11/09/dying-school-captain-speech/?utm_source=SilverpopMailing&utm_medium=email&utm_campaign=20151110%20The%20New%20Daily%20final%20(3)&utm_content=&spMailingID=23943738&spUserID=MTAyODk0Mjg4NDUzS0&spJobID=680889348&spReportId=NjgwODM2MjY0S0

  • Greg Smith- Tax Reform and Change Leadership

    If we look at the tax reforms of the past we can observe a few clear problems that are accumulating from design compromises.

    1. We replaced narrow indirect taxes with a broader GST, but the GST base is narrower than consumption and the trend over the past 15 years is for a relative decline in GST revenues. This has been partly offset for the States by higher mining royalty revenues, but these are now weakening.
    2. Other indirect taxes imposed on narrow bases have declined even more dramatically than the GST. These are structural weaknesses that will not be overcome by future economic changes.
    3. The reformed personal tax scale was not indexed and has undergone a series of changes based both on bracket creep and on ad hoc politically based changes. Forward estimates are based on an assumed increase in average personal income tax burdens.
    4. The income base is a complex compromise between a wide range of competing principles – for example between the comprehensive income and expenditure tax principles, the realisation and accrual principles, the asymmetric treatment of gains and losses, different concepts of source and residence, and different approaches to entities and income assignment. Progressivity is also pursued in a highly imperfect and incomplete way.
    5. Secondary tax layers – that is additional taxes and charges imposed on top of the broadly based taxes such as payroll taxes and stamp duties – continue to be relied upon but without clear rationales or efficient design principles.

    So here we are again. Once again we confront the problems of a compromised tax system and seek to achieve reforms that will at least for a further time set us on a more robust and effective path. We confront another change leadership task which would set us on a substantially new course, rather than one that takes us along an old and well-worn path. Can we do it?

    In 2013 I set out my thoughts on change leadership for public policy in a chapter of the CEDA study called Setting Public Policy. For this I compared what I thought were the key ingredients with those of John Kotter in his work on organisational change.

    Let me revisit the 5 main steps towards leading public policy change which I then suggested based on a part of Kotter’s model, and make some observations on where we stand today with the tax reform debate.

    It is within that framework that the main political economy issues affecting tax reform can be seen to arise.

    Change Leadership tasks

    1. Establishing a sense of urgency
      1. The version of this most common in public service circles is that a crisis is need to deliver change. The issue is whether there really is a basis for any actual or perceived sense of urgency
      2. Unfortunately, it is difficult to create a sense of crisis after 24 years of continuous economic growth. Crying wolf is also a problem, and there has been a cost of the overstatement of crisis that we experienced surrounding Australia’s levels of debt and deficit. We now probably have a more economically wary electorate than ever.
      3. So rebuilding a sense of urgency is now a great challenge for government. It needs to be based on a clear and consistent message about how, and specifically in what ways, the economy’s trajectory is now taking us away from critical goals.
      4. I think we have started on that task – but there is quite a way to go. The coming MYEFO and the other promised government initiatives in tax, the federation and perhaps innovation and cities provides a chance to reboot the required messaging. But at the moment, if anything, we have a problem of “over narration” where many stories have been begun but have not been finished nor have they been brought together in a coherent way. There is even a risk of adding more layers to the narrative confusion, with agendas like innovation or cities, before we get to sort out what has already been launched.
    2. Forming a powerful coalition
      1. The Prime Minister appears to be acutely aware of this element. He has taken immediate initiatives in calling in the classical trio – business, unions and welfare – for discussion of goals. The states are also being engaged.
      2. But the coalition required on tax reform is not yet formed. The coalition is one of many leaders agreeing on the imperative of reform but they are following many agendas and directions rather than forming a coalition sharing the same understanding.
    3. Developing a change vision
      1. Right now I do not know where we are going with tax reform or the federation. There are very mixed signals. I do not expect the answers – that is actually premature. But the principles – not at a high level but at a concrete level should be starting to form by now. There is little sign yet that this is happening or even that the Government seeks to do this before it commits to actual policies. Hopefully 2016 will change that.
    4. Communicating the change vision
      1. The government now appears to be better placed on this than before, and there is a strong sense of hope in the community that we are now facing in the right direction at least. Of course, a change vision is not the same as a political vision. It is a much more demanding thing. The key is to get beyond slogans and beyond the sort of superficial rubbish that in recent years has been commissioned from a group of issue managers, advertisers and political advisers that have repeatedly failed to cut through to the community. They have not been incompetent in playing attack or defence politics – but they have been incompetent in communicating a change vision when clearly there is some community appetite for genuine solutions. This has been a palpable advisory failure on both sides of politics.
      2. When it comes to taking a substantially new path the communication rules of oppositional politics do not work. More is being asked of the public and so the understandable public demand is for a lot more meaning and substance in the communication offering. This understanding seems to have been missing in recent years.
    5. Empowering others to act
      1. One of the reasons for opening government to wider participation and engagement during reform processes is that many change programs actually unfold over a period of years and these implementation years require a lot of heavy lifting by those affected by change.
      2. When the Government charts its course, it should be ready to facilitate the empowerment of others to act, whether that be tax professionals, state governments, the ATO or potentially a host of others.

    Into 2016

    2016 is nearly upon us. It could well be a momentous year. The many processes that have been launched could come to a head. Some sort of coherent framework hopefully can be articulated in which it all comes together.

    Part of that will be a renewed understanding of the fiscal strategy, and the probably very poor economic underpinnings of that. I suspect that it won’t change much but hopefully the implications of what is there can be better explained to people – including for example implications of forward estimates that are based on a large restoration of tax share of GDP.

    All the signs are that this could be a year of global cyclical weakness. That is certainly a widespread market and IMF view. There won’t be much room for policy error, and there may be a need for considerable short term agility.

    This puts a premium in my view on ensuring that the key institutions in Australia are fully focused on their jobs and are sustained to deliver them. There has been inadequate attention to this in recent years, and that has been part of the problem holding back reform capability.

    2016 will also bring an electoral mandate for the next three years at the Commonwealth level. I am not certain about the actual significance of mandates in Australian politics, but hopefully there will be a basis for reform at least as strong as that sought by the Hawke Governments in the 1980s and the Howard Government in 1998.

     

    Greg Smith was a member of the Henry Future Tax Review Panel. He has also been head of the Treasury Tax Policy and Financial Institutions Division and of Treasury Budget and Revenue Groups. He was substantially involved with John Howard in the implementation of the GST. The above are extracts from a speech he delivered to The Melbourne Institute last week.

  • Ian Richards. Australia’s new submarine.

    Jon Stanford’s article ‘Australia’s new submarine: what is its mission?’ is spot on.

    The trouble with Defence planning and White Papers is that they all start off with what in my early days in the Navy was called a “Staff Requirement”.  This thing, this equipment or ship is what we “require”.  The first chapter of a Defence White Paper should be “How much money have we got”!

    The bureaucratic Canberra attitude to money is that it just “comes”.  A very competent technical Admiral once said to me in my days as Deputy Chief “Ian, are you saying we can’t do this just because of money?”

    The 2009 White Paper is off in dreamland.  Structuring Australia’s forces with the objective of the South China Sea as one of our possible areas of major Australia alone defence interest is just nonsense.  For example:

    • Day One.   The “major adversary” is trembling in its shelters!  An Australian conventional submarine is threatening us in the South China Sea!!  And it has conventional cruise missiles!!!
    • Day Two.   Scratch one Australian submarine.
    • Day Three.  Scratch Perth/Fremantle.

    Planners who suggest the ADF is unilaterally going to attack a nuclear-armed adversary in Asia are away with the fairies.

    There are some simple facts.

    1. Australia has never and will never in current lifetimes operate significant military forces beyond the Australian area other than in concert with other (almost certainly more powerful) nations. Examples are WW2 to Korea, Vietnam, Iraq, Afghanistan, Syria.
    2. Australian forces in Syria and the Red Sea are providing the tip of the arrow as political support.  The shaft and the bow belong to others – without them, the arrow tips would be useless.

    Turning to intelligence gathering, I also agree entirely.  If you want to listen to any type of radio transmission, put the receiver into a ship (war or merchant), shore station, embassy or satellite.  The worst place is in a submarine.  If you want a clear picture of something, don’t enlist a blind man and put him in a dark room.

    The intelligence-gathering feature of submarines appeals to The Hunt for Red October fans.  It has a lovely emotional tang about it.  So what is the “Australian contribution to the Five Power intelligence club” if an Australian conventional powered submarine sitting off Shanghai/Vladivostok (which will have been detected by the Chinese/Russians) can tell the US that an SSK (conventional submarine) has left harbour?  The Americans will know that because they saw it on satellite.  Or perhaps our submarine will be operating in the Eastern approaches to Singapore Strait – the South China Sea choke point – where submerged submarines can be seen from the air and sonar ranges are extreme.

    Ian Richards AO was formerly Deputy Chief, Naval Staff when he retired as Rear Admiral in 1984.

     

     

  • Ian Marsh. Will privatised schools and hospital drive public sector efficiency?

    One of the first substantive announcements of Treasurer Scott Morrison concerned the privatisation of schools, hospitals and community services that are provided by State governments. He enthusiastically endorsed this 2012 Commission of Audit recommendation: ‘Given the size of the human services sector (which is set to increase further as Australia’s population ages), even small improvements will have profound impacts on people’s standard of living and quality of life.’ Morrison pointed to the greater efficiency and effectiveness that a competitive regime can deliver. There is no doubt that market mediated competition can drive performance. The private sector provides daily evidence of this.

    But the notion that these approaches can be readily transferred to public services like schools and hospitals and social services cries out for deconstruction. For a start schools, hospitals and social agencies serve many purposes that cannot be easily captured in a unified price measure. How are these more subtle and variegated outcomes, which can vary hugely between individuals and between places, to be incorporated in a contract design? No easy challenge in itself. For reasons the Harper review acknowledges, it is fanciful to imagine that consumer choice can be generally instituted. In it absence, who are the omniscient, all-knowing central agents who will define the precise outcomes that contracted services should deliver? Even assuming this is possible, in practice accountability systems that recognise these wider concerns increase the likelihood of micro-management. And then the alleged benefits of privatised or contract-based settings rapidly evaporate. Innovation or continuous improvement is stillborn. Transaction costs escalate.

    Is there an alternative to these dysfunctions? One approach might be to build on private sector practices that directly lead on to service or process innovation. Think of the Toyota just-in-time production system. Toyota deliberately jettisoned end-of-line capacities to repair or correct faults. It deliberately limited back up component reserves in case of supply chain hiccups. Production was stopped by every fault or flaw. But each of these stoppages became a key source of data in Toyota’s never ending quest for improved efficiency. This covered both the immediate production process as well as the wider system in which it nested. Unlike the aggregated information or ‘strong’ signal that is embodied in price data, this approach focused on the ‘weak’ signals that were critical to continuous improvement.

    Prices embody the outcomes of a multitude of these weak signals. Note Toyota’s rise to become the major global car company. This was an immediate consequence of the visible hand of management practice – only distantly that of the invisible hand of market forces.

    Or note the consistent stellar performance of the Finnish education system. Not one single school is privatised. Instead there is a deliberate focus on identifying obstacles to student performance at an individual level and from an early age. The system deploys more special education teachers than any comparable country. These work with mainline teachers and parents to identify under-performing or troubled children. They focus on these early ‘weak’ signals and initiate immediate remedial action. Approximately one third of the pupils in Finnish schools receive extra support in special education classes.

    So markets and contracting by all means. But if they are to work the invisible hand of the market need to be supplemented by the visible hand of ‘weak’ signals. These are the building blocks of continuous improvement. Of course the challenge to identify pertinent weak signals varies widely. The relevant indicators are not the same in routine or highly specialised surgery or in Accident and Emergency or routine hospital care.

    Translated to a contracting system, how can this be achieved? In principle the answer is simple. Contractors need to report not just on the outcomes that they believe they can achieve but also the means that they propose to use to achieve them. Then they need to be held to account for both outcomes and means. A central authority then needs to manage accountability and learning about these means. Its role is to learn and then to share this information amongst providers.

    The core ethos of such a system is learning about means as well as outcomes. Its unit of exchange is the means used by different providers who are working towards broadly similar ends. But these exchanges will typically not involve anything that could be described as ‘best practice’. Most service settings are too contextualised to allow codified or standardised service designs to be developed. Service decisions need to take into account the circumstances and needs of an individual person or a specific place. In a technical sense decisions are ‘transaction intensive’ – prioritising the needs of individuals or places and mostly blending the technical skills and the empathic judgements of practitioners. Thus a teacher must respond to the circumstances of her students, a doctor to the needs of her patients. In both instances, the hardest cases can provide the richest source of systemic learning.

    Indeed where services can be codified and standardised price mediated exchange will be a sufficient driver of performance. Where the latter is not possible, price mediated exchange will not by itself drive performance. Unless contracts or other systemic arrangements also disseminate learning about means, rhetorical promises of efficiency and continuous improvement will be misleading, indeed chimerical.

    In a justly celebrated book, The Visible Hand, the distinguished Harvard economic historian, Alfred Chandler, showed the extent to which business efficiency in the United States was the product of superior management not in the first instance price mediated exchange. In seeking efficiency and continuous improvement in the much more complex world of hospitals, schools and community services this visible hand is even more critical.

    Over the past thirty years, the discipline of economics has been a fertile source of models and frameworks for the redesign of government and of public services. But as more complex, transaction intensive services (‘wicked’ problems) have come increasingly to be the focus of attention, the limitations of price mediated exchanges need to be acknowledged. This is not the royal road to innovation and continuous improvement. Pace the Harper Review, the design of a functional innovation system is a more complex and more demanding challenge.

    Ian Marsh is a visiting professor at the University of Technology Sydney’s management school.

  • Malcolm Turnbull’s NBN is off the rails.

    Paul Budde comments in his BuddeBlog on 6 November 2015

    ‘If you abandon national FttH (fibre to the home) you also undermine the infrastructure required by the new economy. … The MTM [multi technology mix] leads to the Balkanisation of infrastructure in Australia and will favour companies such as Telstra and TPG. … The NBN Co will remain bleak from a financial position. … All of this becomes an even sadder story day by day, as at the same time it becomes clear that the trumped up costs of an FttH-based NBN were wrong. … The second rate roll out is going to cost roughly the same as the original FttH rollout.’

    See link to full article below.

    http://www.businessspectator.com.au/article/2015/11/6/technology/nbn-business-model-rails-0

  • John Taylor. Investing in Hedge Funds in Tax Havens: Legal? Ethical?

    If the aim of Labor’s attack on Prime Minister Malcolm Turnbull and his wife Lucy for using hedge funds domiciled in the Cayman Islands was to damage his credibility with the public, it appears to have missed the political mark.

    This article considers whether investing in hedge funds in tax havens is both legal and ethical.

    Advantages of offshore funds in tax havens

    Investing in US companies via a hedge fund enables Australian individuals and organisations to make investments over a much larger, more diverse, and more frequently changed portfolio than would be possible by directly investing in shares in US companies.

    If an Australian invests in a US-domiciled hedge fund then the Australian investor (under the Australia – US Double Tax Treaty) would be subject to 15% US withholding tax on dividends the fund received from US companies. This is because US domiciled hedge funds are usually established using structures such as partnerships that are transparent for US tax

    The Australian foreign income tax offset system will mean the Australian investor would pay Australian tax on those dividends equal to the excess of their average rate over 15%. The investment would also be subject to Australian capital gains tax on any capital gains the fund made on its US investments when they were sold. The Australia – US Double Tax Treaty will mean that normally no US capital gains tax will be payable..

    The position changes when an Australian investor uses a hedge fund domiciled in a tax haven such as the Cayman Islands.

    Let’s assume the fund invests in US shares. Normally the fund will be organised as a Cayman Islands company. The fund will structure its US share investments so that the investments are not regarded as the conduct of a US trade or business. Hence capital gains the fund makes on realising its US investments will not subject to capital gains tax in the US. This is because the capital gain will not be regarded as being “effectively connected” with a US trade or business.

    Any dividends received by the Cayman Islands hedge fund will be subject to US withholding tax at the US non-treaty rate of 30%. There is no double tax treaty between the US and the Cayman Islands.

    There will be no Cayman islands capital gains tax payable on a realisation of the investment, no Cayman Islands income tax will be payable on dividends received on the shares, and no Cayman Islands withholding tax will be payable on distributions by the fund to the Australian investor.

    Although no Cayman Islands withholding tax will be payable on a distribution by the fund to the Australian investor, a higher level of US withholding tax is payable on the dividend paid by the US company to the fund. So looking at the dividends in isolation there seems to be no advantage in investing via a Cayman Islands hedge fund.

    The real tax advantages Australian investors gain by investing via the Cayman Islands hedge fund rather than via a US domiciled hedge fund, are in terms of the ability to defer tax on capital gains the fund makes on underlying investments.

    In the case of an investment via a tax-transparent US hedge fund, the capital gain will be subject to Australian tax as soon as the investments are sold. But in the case of the investment via the Cayman Islands hedge fund, the capital gain will only be taxed in Australia when the fund makes a distribution.

    The time value on the money will mean the real cost of the tax the investor pays on the capital gain falls for as long as the fund defers distributions to the investor.

    Over time in real terms, less Australian tax will be paid. Admittedly the investor will not have benefited from receiving the distribution in that time and will not have control of the time of distribution. But an investor can use the appreciation in value of the investment as security against other financial transactions.

    Is it legal?

    The legal question is the easiest to answer. Australia used to have rules (the Foreign Investment Fund or FIF rules) which sought to neutralise these and other deferral advantages. Those rules were repealed in 2010. In 2011 the Gillard Government proposed more targeted rules for foreign funds (the Foreign Accumulation Fund or FAF rules) but the Abbott Government in 2013 announced that it would not be proceeding with these and other related changes. So deferring Australian tax through the use of foreign hedge funds is currently not caught under Australian law.

    Is it ethical?

    How about the ethical question? This answer is harder. An investment via a Cayman Islands hedge fund results in more US tax and more Australian tax being payable on dividend distributions than investment via a US domiciled hedge fund organised.

    If we assume an ethical obligation to pay taxes both in the source and residence country, then deriving dividends indirectly via a Cayman Islands hedge fund meets that obligation.

    But the position is different in relation to capital gains the funds make on shares in US companies.

    Neither fund will be paying US tax on the capital gains but, in the case of investment via a US domiciled tax transparent fund, Australian tax will be payable on the capital gain as soon as it is realised, while Australian tax will only be payable on the capital gain derived by the Cayman Islands domiciled fund when that fund distributes it to the Australian investor.

    So back to the ethics of this. If everyone did this, there would be seriously adverse revenue consequences for Australia. But of course, not everyone can. Investing in Cayman Islands hedge funds is largely the preserve of the financially astute or those with the resources to seek advice from the financially astute.

    That could raise another ethical question – is it unethical to use your own financial acumen, or that of others, to derive tax advantages unavailable to those without access to that financial acumen?

    It depends on whether we regard taxes as a payment for the benefits a taxpayer receives from society. If so then it is arguable that those with greater financial resources receive greater benefits from society. They benefit from having their greater resources protected by law and by domestic law enforcement. As they have more assets they benefit more by having them protected by the defence force. They derive greater benefit from infrastructure through which business can be conducted.

    If we regard taxes as a payment for the benefits received from society and if we accept that those with financial benefits receive greater benefits from society then to use your financial resources or financial acumen to pay less tax than is proportionate to the benefits you receive from society can be considered to be unethical. If everyone paid less tax than was proportionate to the benefits they received from society then society would eventually be unsustainable.

    Professor John Taylor is Head of School of Taxation and Business Law, Australian School of Business, UNSW. An earlier version of this article appeared in The Conversation on October 30, 2015.

  • Bob Kinnaird. The high price of Labor’s capitulation on ChAFTA

    Labor’s capitulation in supporting the treaty-status ChAFTA has profound ramifications that go far beyond the China deal.

    Labor’s support for ChAFTA has all but guaranteed the permanent surrender of Australian sovereignty over key parts of our migration program and laws, and the permanent loss of rights of Australian citizens and permanent residents to jobs in Australia.

    The Labor and Coalition leaderships both know this but have not told the Australian people or the Australian Parliament.

    Labor’s decision to pass the treaty-status ChAFTA unchanged effectively ensures the permanent removal of the Australian government and Parliament’s right:

    • To impose any limit on the number of visas granted in the entire standard 457 visa program for skilled workers or the shorter-term 400 visa.
    • To apply labour market testing (LMT) in the entire standard 457 visa program.
    • To apply LMT in the 400 visa program to a whole new foreign worker category in binding FTAs – ‘installers and servicers’ of machinery and equipment. These include for the first time in FTAs sub-trade or semi-skilled workers, and possibly even unskilled workers, as well as skilled workers.
    • To apply other regulatory measures in the 457 and 400 visa programs that remain unspecified and ambiguous, and which the Australian Parliament has not even inquired about. What is covered by Australia’s commitment not to apply ‘economic needs tests or other procedures of similar effect’ to foreign nationals in these visa programs is not even known.
    • To make laws giving preference in redundancy situations to Australian workers over standard 457 visa workers, and likewise over the ‘installers and servicers’ on 400 visas. The ‘national treatment’ provisions of FTAs prohibit such ‘discrimination’ in favour of Australian workers, but the Treaties Committee reports to Parliament on ChAFTA said nothing about this either.

    These binding international obligations in ChAFTA on the 457 and 400 visa programs will now flow on to other countries through the plethora of FTAs the Coalition government is aggressively pursuing. That flow-on has already started, as shown below.

    As well, Labor has guaranteed that all future FTA ‘packages’ with developing countries will allow semi-skilled and other ‘concessional’ 457 visa workers access to the Australian job market under the guise of ChAFTA-style ‘investment facilitation arrangements’ (IFAs).

    Labor approved the IFAs as part of the ChAFTA package with only cosmetic changes to the migration regulations for concessional 457s under these arrangements. These provide no additional ‘safeguards for Australian jobs’, despite Labor pretending they do.

    The MOU on IFAs is not part of the treaty-status FTA, but DFAT says it is nonetheless ‘a serious bilateral agreement’ between the governments of Australia and China. Changes to the MOU require China’s agreement. Labor and the Coalition have therefore succeeded in also reducing the previously unfettered right of the Australian government and Parliament to make laws and policies for concessional 457 visa workers on major projects.

    In October Trade Minister Robb admitted the Coalition is lining up more ChAFTA-style IFAs (India is almost certainly next), saying:

    ‘This has to apply not just to China… – in the case of that issue, these major projects over $150 million – that opportunity is there for every company in every country, so we have to look beyond China; we have to make sure that this doesn’t discriminate against China and that it’s not a one-off provision just for China’ (transcript, Robb media conference on 13 October 2015).

    As well as the loss of Australian sovereignty, all this means greatly increased legal rights for employers to use temporary foreign labour, and to use these workers as industrial relations weapons against Australian workers and unions.

    The ChAFTA flow-on

    The China FTA commits Australia not to apply LMT to all Chinese citizens in the standard 457 visa program – currently around 7 per cent of the total 457 program. That is a ‘point of no return’ moment.

    Until the China FTA, the Coalition had declared that only the nationals of Japan, Korea, Chile, Thailand and NZ had a blanket 457 LMT-exemption due to Australia’s international trade obligations in FTAs. These comprise only a small fraction of the 457 visa program (around 4%) with the largest of these (Korea and Japan) in FTAs concluded by the Abbott government.

    The China FTA will take that LMT-exempt share up to 11 per cent of the 457 visa program when it comes into force before end-2015.

    Once China goes, the rest will follow. By late 2016 nearly half of the entire 457 visa program will probably be exempt from LMT due to Australia’s binding international trade obligations as the China FTA LMT concessions flow through to other new FTAs. It could be more than half.

    Having capitulated on the China FTA, Labor is now unlikely to oppose extending the same blanket 457 LMT-exemption to all the other FTA countries that the Coalition is lining up in short order. Labor will need more resolve than shown so far to resist the claims of ‘discrimination’ that will be heard from every FTA country denied the same privileges as China.

    The most important of these is India, the largest country in the 457 program with 24 per cent of all visas. Concluding the India FTA by the end of 2015 is the Coalition’s next self-imposed deadline. Having waved through the China FTA, Labor will do the same for India. At that point, 35 per cent of the 457 visa program will then be LMT-exempt due to binding international trade obligations.

    In the Trans Pacific Partnership (TPP) announced in October, Australia has committed not to apply LMT in the standard 457 program to all nationals of five TPP countries – Brunei Darussalam, Canada, Malaysia, Vietnam, and Mexico – representing a further 5 per cent of the 457 program.

    Australia has also made a standing offer to do the same for the three other TPP countries without a total 457 LMT exemption (the USA, Peru and Singapore) if they provide access to limited categories of ‘Australian business persons’ down the track – another 7 per cent of 457s.

    The ChAFTA concession not to apply LMT to ‘installers and servicers’ on 400 visas has also been extended to eight TPP countries – Brunei Darussalam , Chile, Japan, New Zealand, Peru, Canada, Malaysia and Mexico -and no doubt shortly India also.

    Waiting in the wings are other FTAs including the Regional Comprehensive Economic Partnership (RCEP), the Trade in Services Agreement (TISA) with 51 WTO members, Indonesia, the Gulf states and now the EU. The RCEP is perhaps the next most important for Australian temporary visa concessions. It includes the ten ASEAN member states and those countries which have existing FTAs with ASEAN – Australia, China, India, Japan, Republic of Korea and New Zealand. 

    Labor’s road to capitulation 

    Labor’s decision to support ChAFTA is a clear breach of commitments given by Opposition Leader Mr Shorten. In the Labor leadership contest in September 2013, Mr Shorten publicly committed to ‘opposing the removal of LMT in bilateral and multilateral trade agreements’ – as did Mr Albanese, the other candidate. (See ALP Leadership Questionnaire http://www.cfmeu.net.au/news/alp-leadership-questionnaire)

    Both candidates also committed to ‘opposing all attempts by the Coalition government to weaken sponsors’ legal obligations to undertake Labour Market Testing (LMT) so that 457 visa nominations may be approved only where a suitable Australian resident is not available to fill the position’.

    Labor failed to honour these commitments at the first test. When the Coalition brought the Korea Australia FTA (KAFTA) before Parliament in September 2014, Labor voted to support the FTA even though it removed Australia’s right to apply LMT to all Korean nationals (and permanent residents) in the standard 457 visa program.

    A few months later, Labor did the same with the Japan FTA which included identical provisions to KAFTA, removing Australia’s right to apply LMT to all Japanese nationals in the standard 457 visa program.

    Even after conceding on the first two North Asian FTAs, Labor still had good reasons to draw the line under Japan and Korea, and oppose the China FTA ‘labour mobility’ provisions.

    Labor’s own Treaties Committee Dissenting Report on ChAFTA warned ‘ there is a danger that Australia’s labour mobility commitments in CHAFTA will be used as the new baseline demand by all countries with which Australia is negotiating FTAs and all will expect Australia to offer additional concessions.’

    The 2007-13 Labor governments concluded several FTAs, with Chile, Malaysia, and ASEAN/NZ. But none of Labor’s FTAs removed Australia’s right to apply LMT in the 457 program to all nationals of the FTA parties. This was despite the fact that during this time, Labor did not withdraw the Howard government’s (non-binding) 2005 Doha Round offer in WTO GATS to remove LMT from the entire 457 program, but had actually re-affirmed it. 

    Conclusion

    The sorry truth is that both Labor and the Coalition are prepared to trade away Australian sovereign rights and the work rights of Australian citizens in binding FTAs in return for improved market access for Australian business and investment flows.

    The crude calculus dominant in the major parties and among unelected trade bureaucrats is that Australia has little to offer in trade negotiations with many countries, except greater and ‘guaranteed’ access to the Australian job market. This is because the (mostly unilateral) trade liberalisation already undertaken by Australia has left us with nothing much to offer that our FTA negotiating partners want!

    The major political parties won’t say this openly, especially when both maintain the fiction that Australia’s 457 and other temporary work visa programs are designed to meet ‘shortages’ of Australian workers.

    But DFAT admitted this to the tripartite Skilled Migration Consultative Panel in 2008:

    ‘Australia is now negotiating or planning to negotiate FTAs with a number of large developing countries….Given the degree of trade liberalisation already undertaken in Australia, and the limited ability of persons from some developing countries to take advantage of opportunities at the highly skilled end of the Australian market, temporary entry for semi-skilled and low skilled persons is one of the few areas (along with economic capacity building) where some of Australia’s developing county FTA partners have strong offensive interests. Naturally, Australia’s bargaining power in any trade negotiations with these countries will be significantly enhanced if it is able to respond favourably to their temporary entry interests.

    ’ From a trade policy perspective, therefore, it is in Australia’s national interest to ensure that its approach to temporary entry for work and business purposes is liberal, transparent, flexible and market-driven.’

    (Source: DFAT, Trade commitments and reform of the subclass 457 visa program, Discussion Paper to Skilled Migration Consultative Panel, September 2008).

    The Productivity Commission and others have shown that the alleged economic benefits of FTAs have been grossly overstated. The Commission recently noted that promotion of the benefits of FTAs and the TPP has been “characterised by a lack of transparent and robust analysis, a vacuum consequently filled at times by misleading claims”.

    The costs of FTAs – and indirectly, unilateral reform – have also been understated or ignored. The permanent loss of Australia’s sovereign right to make laws concerning temporary migration, with no public debate, is too high a price to pay for the dubious benefits of FTAs.

    Bob Kinnaird is Research Associate with The Australian Population Research Institute and was National Research Director CFMEU National Office 2009-14.

  • Christmas gift idea – Pearls and Irritations in print

    Orders are now open for Fairness, Opportunity and Security: Filling the Policy Vacuum, edited by John Menadue and Michael Keating, and published by ATF Press.

    coverThe book is a collection of the special policy series of blogs that was published earlier this year.

    At last week’s launch, Fairfax economics columnist Ross Gittins said of series: ‘I hope this project of turning them into a book will make them even more accessible and more widely read. They certainly deserve to be.’

    Topics include Democratic Renewal, the Role of Government, Foreign Policy, the Economy, Retirement Incomes, Population/migration/refugees, Communications and the Arts, Security – internal and Human Rights, Security, Health, Development of Human Capital, Environment, Indigenous affairs, Welfare and Inequality.

    Among the authors are Ken Henry, Ian Marsh, Stephen FitzGerald, Cavan Hogue, Richard Butler, Stuart Harris, John McCarthy, Andrew Podger, Julianne Schultz, Kim Williams, Susan Ryan, Michael Wesley, Jennifer Doggett, Glen Withers, Chris Bonnor and Ian McAuley.

    Gittins described the book’s contribution to robust conversation about policy at this time as unique and indispensable: ‘In view of this policy vacuum needing to be filled, it’s really great to have John providing this new platform and encouraging former bureaucrats to use it. Never has their contribution been more needed. We independent media commentators do our best to evaluate the government’s performance, but there’s nothing like a former bureaucrat to be able to see through the smoke and mirrors and decipher the true position.’

    CLICK HERE to download the flyer and order form. For a limited time, the book is available for $49.95 (paperback) and $69.95 (hardback).

  • Tony Kevin. Time for review of our foreign policy.

    Why Australia need to get its head around great power multipolarity.

    Most Australians think of foreign policy as an esoteric, wonky field. Beyond special-cause activists, few Australians give much thought to our foreign policy choices. One who does is Professor Ramesh Thakur at the Australian National University. He does serious academic work on issues like UN peacekeeping, Security Council powers and responsibilities, the global responsibility to protect human rights , and changing great power balances. His opinion piece written a year ago is pertinent to this essay.

    In 1985-1990, as the defeated and dysfunctional Soviet Union eked out its sad and confused final years under Gorbachev, Western foreign policy theorists were thinking about the looming end of US/Soviet Cold War bipolarity and its replacement with a stable multipolar global system: i.e., a balanced international security system resting on several great powers, not necessarily equal in power, but in which all felt their national security was protected by a UN Security Council-based rules-based international order.

    It turned out we were around 20-30 years too early. With the breakup of the Soviet Union in 1991, the world entered a long unipolar moment of US hegemonic exceptionalism, which ended … but when did it end?

    With the ruthless and wrenching 2001 Al Qaeda terrorist attacks on the US heartland? With the final withdrawal in 2011 of US forces from Iraq after a costly and bloody eight-year military occupation?

    With Russian President Putin’s newfound resolve in 2008, when after eight years of trying to reach a modus vivendi with a triumphant United States, he began to confront US/NATO pressure to project power into Russia’s vulnerable Western borderlands, first in Georgia (2008). And then in Ukraine since 2014?

    With the coming to power in China in 2012 of the vigorous nationalist leader Premier Xi Jinping?

    https://en.wikipedia.org/wiki/Xi_Jinping

    Or now in 2015, with Russia’s so far successful military assistance to the Assad Government in Syria, and with China’s intensification of its fortification of islets and reefs in the South China Sea, despite US anger?

    Thakur (op.cit) notes that it is hard to map great power transitions with confidence while they are occurring, and that there are increased risks to peace during these transitions. We are in such a period now. Whatever the date of the ‘tipping point’, the US unipolar moment is ending and real multipolarity is upon us. Russia, China, the rest of the BRICs (India, Brazil, South Africa) , and Iran are testing new multipolar arrangements for sharing world power – initially in finance and trade, but as we will find in coming years, in international security as well.

    The former ‘indispensable’ power’ of the past 25 years hates and fears these changes, and would prefer to corral everybody – friends and adversaries alike – back into the familiar bipolar camps of the past. We are looking, at worst, at a potential new global bipolarity of the US with its loyal allies or satellites (NATO/ EU, Japan, Canada and Australia, pro-US Sunni Arab states) confronting a new Eastern continental power bloc led by an economically strong China, but with Russia’s revamped military strength providing much of the nuclear deterrent, conventional power projection forces and strategic depth.

    This would be a disaster. The world spent decades trying to escape the risks of nuclear war during the 1948 -1991 Cold War confrontation. Why on earth would Australia ever wish to go back to those risks? And why would Putin or Xi want to, unless US aggressiveness left them no alternative?

    Soviet Communism is dead, and the market-oriented Chinese version is no ideological threat. Both leaders are keen to work within a multipolar and UN Security Council-determined framework of collective global security.

    But a US ‘war party’ , influential in both Republican and Democrat parties, pines for return to a neo-Cold War: by force of habit, and because it is hard to maintain voter support to pay for the world’s leading military capability without an adversary more serious than Al Qaeda or ISIL. The US power structure – never mind the huge challenges of underclass poverty and the environment in the US – needs a big strong enemy.

    Australia doesn’t. Nor do the EU, Canada, and the rest of the world, yearning for peace and united focus on global developmental and environmental challenges. We will all benefit from a stable rules-based multipolar world, and Australian foreign policy under Turnbull or Shorten can help build it. But we are going to have to take a few calculated risks on the way.

    We can’t be a dumbly obedient janissary for the US in its prickly relationship with China. We have to strike our own balances, respecting Chinese great power security concerns in the South China Sea –  not so different to long-held US security concerns in the Caribbean.

    Similarly we have to respect Russia’s security concerns in its adjacent borderlands to the West and South. Neutrality of Ukraine could be made to work, as it works for Finland. Ukraine’s neo-Nazi extremists need to be reined in, not clandestinely encouraged by the West. NATO’s newest members Poland and the Baltic States need to accept Russia’s rights to security. (They have already done well, coming in under the NATO umbrella).

    And the West need to treat Mr Putin with the respect due to the capable leader of a great nation, with huge territory and resources and on the path, despite hiccups, to a middle-class parliamentary democracy. The pointless propaganda war and demonisation of Putin needs to stop. It is only solidifying his huge lead in Russian public opinion polls – now nearing 90% approval – and strengthening Russian suspicion of Western motives.

    Australia needs to welcome the opportunities for us in the world’s growing multipolarity. Hiding behind US skirts will not protect us in the end: we need to contribute good ideas to the ANZUS alliance. Australia needs to move towards a smarter, more adept global diplomacy. There is uncertainty about the next US President and his or her quality of strategic judgement. The US will need wisdom and frankness from its allies, not blind loyalty. The unmourned departures of Abbott and Harper, Canada’s choice of a youthful open-minded Justin Trudeau, and David Cameron’s kow-towing to Xi Jinping during his recent state visit to London, all signal to Australia that it is time for a serious foreign policy audit.

    Multipolarity will be good for Australia’s economy and security if we seize its opportunities for strengthened global and regional peace and security. We are well placed as a rich multicultural nation to contribute and benefit.

    Neither the Coalition, nor Labor, nor the Departments of Defence and Foreign Affairs, nor the assessment agencies, show much sign of beginning to think about these challenges. It is time they did.

  • Peter Gibilisco. Friendship and Service Provision Ethos for People with Disabilities

    In this article I want to discuss an aspect of the standardised procedures set by service providers in facilities that serve people with disabilities. More to the point, I am keen to explore how this affects the ethos of service delivery for people with severe or profound physical disabilities within such shared supportive accommodation.

    Let me be utterly frank. The ethos of service delivery, in this house where I live, has lacked key attributes that are necessary for caring for people with disabilities. Admittedly, I have sought to draw attention to this deficit by a constant effort to raise awareness. And an organisation’s ethos takes time to change. Nevertheless, the jury is still out with respect to whether we are experiencing a positive change. I am concerned that the friendships that I have made with support staff be respected by a form of management that recognises the benefits that arise from the personal synergies that arise from the work done.

    There is a simple need of enjoying life as an individual, in a way that is like the individual aspects of dignity that are part and parcel of the much proclaimed “freedom of choice.” I want to ask: has the “right to choose” become a ploy of many service providers? The principle is conveniently displayed in marketing and other public relations material. But is it all a matter of staying on the politically right side of the Government and public opinion?  After all, it can be argued by many living in such supportive accommodation that the self-interest of top management has been placed well beyond the reach of the people with disabilities that these facilities are established to serve. But Personal Care Attendants (PCA) are not just an abstract function;  they are people just like the people they are employed to serve.

    This state of affairs is why I am taking the opportunity of writing this article. Our friendships with PCAs need to be defended. I am a little fired up although I guess some who know me will think that is rather strange. It is true: I cannot wave my arms around and bang my fist on the table. But I am just a little concerned that the message I have been putting for many years gets through. This is serious.

    I am a severely physically disabled person with Friedreich’s Ataxia, who presently lives in shared supported accommodation. This place can fail to administer appropriate assessment of my specialist medical and social needs, one of which is human companionship. This place needs to function in ways that allow the clients with disabilities to solve individual problems pertaining to their own problems even if the house is managed under the protocols of a service provider. And the workers should be respected as our friends.

    I am quite sure that those managing this place were not expecting me, and I too never expected to be here. But even though we have to make the most of this unfortunate state of affairs, it is not going to prevent me from saying what needs to be said.

    The service provider has a real problem. Rather than looking to a set of policies that emphasise procedures that are formed individually with the needs of the person front and centre, they seem to be stuck with operating in a standardised way that at the same time keeps the self-interest of top management of service providers out of sight, and makes continuity with workers difficult.

    The standardised procedures simply do not provide adequate support. Even if the standardised approach qualifies as “best practice” under some managerial criteria we, and our day-to-day relationships that sustain us, are simply too complex for an abstract modus operandi.

    As a matter of fact, I am not a person with a cognitive, behavioural or developmental disability. I do not take kindly to being treated like one, as I am also sure many people with intellectual disabilities do not take kindly to being treated like a semi-paralyzed person who has to live in a wheelchair. Mistreatment that ignores a person’s humanity, violates the person’s right to be given due respect.

    My complaint also has to do with the ethos of the place I live in. Let me tell you what I experience all too often. My friendships with my support workers are unfairly reduced in a variety of ways by the presumptions of management that fail to respect what is going on. Support workers are the first faces we see in the morning and last faces we see at night. It is as if our friendships are simply not part of the implementation of policy. I suspect that this kind of managerial presumption of the disposability of friendship is alive and well elsewhere in social welfare delivery. But I am keen to preserve the friendships that keep me going, even as I find my body slowing down.

    I am also not wanting to identify any individual manager – there are some I have come across who come to mind that possibly should be exposed for their blindness and self-interest, but I will restrain myself.

    My aim here is to suggest some sustained soul searching among those managing service provision for ‘people with disabilities’.

    I’m writing this against the background of a service delivery context that is simply not good enough.

    Dr Peter Gibilisco was assisted by Dr Bruce Wearne in the preparation of this article.

    Special thanks to Cunxia Li, Patrick Wleh and Christina Irugalbandara.

  • Quigley, former CEO of NBN, attributes $15 b. cost blow out to Turnbull’s Multi Technology Mix.

    For comment by Renai LeMay, see link to his blog delimiter.com.au below:

    https://delimiter.com.au/2015/11/05/quigley-releases-detailed-evidence-showing-mtm-nbn-cost-blowout/

    John Menadue.