This site has previously lamented the gradual denuding of Australia’s public service, which has been stripped raw by decades of government outsourcing, waves of senior redundancies, as well as a preference for governments to seek advice from paid consultants, erroneously named ‘think tanks’, and political staffers.
The end result has been that the days of “frank and fearless advice” have gone, replaced by spin and bought analysis designed to support a pre-conceived political agenda.
Today, former senior public servant, Paddy Gourley, has penned a ripping treatise on the politicisation of Australia’s public service, which takes particular aim at the Australian Treasury. From The Canberra Times:
Towards the end of last year, it paid $16,500 for the preparation a paper by Griffith University professor Tony Makin. It can now be found on a “Treasury Research Institute” website. Makin has a reputation as a fiscal conservative and has been a trenchant critic of the Labor government’s fiscal response to the economic difficulties that developed in 2008. Parkinson put down one of his earlier papers, saying its criticisms were “based on a theoretical model that does not apply in Australia’s case and assumptions that did not hold during the global financial crisis”.
True to his known views, Makin’s paper is highly critical of the Labor government’s fiscal stimulus during the global financial crisis. It has outraged the ALP and thrilled the Murdoch press and other commentators; one said: “ALP spending binge during the GFC has wrecked our economy … now the official Treasury view.”
What is this Treasury Research Institute? It’s part of the Treasury and is directed by the department’s executive committee. It’s a Potemkin institute that has failed to avert the impression that the Treasury is taking sides in a partisan debate. In short, the department is politicising itself, a risk Treasury secretary John Fraser must have realised when he commissioned the Makin paper. It’s all very well to try to promote debate but all this paper has done is encourage partisan anger, including about the Treasury’s role in commissioning it. It would have been better if the department had stuck more to its knitting: providing advice and support to the government of the day. The institute should be shut down before it causes further havoc.
Gourley’s Fairfax colleague, Ross Gittins, made similar arguments late last year about the politicisation of the Treasury:
Among Tony Abbott’s first acts upon becoming prime minister in 2013 was to sack the secretary to Treasury, Dr Martin Parkinson… replaced by John Fraser, a retired funds manager, hand-picked by Abbott…
The Abbott government’s next act of politicisation came a few months later with the publication of Treasury’s fourth five-yearly intergenerational report. It had been turned into a partisan propaganda rag…
The latest stage in the politicisation of Treasury came… with its publication of a report on The Effectiveness of Federal Fiscal Policy, commissioned from Professor Tony Makin, of Griffith University…
Makin’s views on the ineffectiveness of fiscal “activism” – using budgetary stimulus to assist recovery during recessions – are well known, unchanged and unchanging.
He’s the go-to guy for anyone who’d like an independent report asserting that fiscal policy doesn’t work – never has and never could…
Makin’s well-rehearsed argument that the Rudd government’s budgetary stimulus – undertaken at the urging of the then Treasury secretary, Dr Ken Henry – was unnecessary and unhelpful…
One small problem – the last time Makin ran his anti-activism line, in a paper commissioned by the Mining Council, Treasury issued a detailed refutation. Makin seems to have taken none of its substantive criticisms into account in his Treasury-commissioned version.
This is a measure of the extent to which politicisation has changed Treasury’s tune.
R.I.P the Australian Treasury. You might as well close up shop and let the IPA take over responsibility for economic and fiscal advice.
