One of the hardest conversations that I have seen fought, or more often avoided, within Labor is about the capacity of Government. I still remember the first time my superior in a staffer job said straight up, “Government is less efficient.” It was said as fact, not open to question. As a relatively young staffer at the time, I did not know what to do with that. I recognised that anything I said to the contrary would leave us at an impasse. His view was black and white, and there was no chance I could convince him to see another perspective, or even a shade of grey.
Everyone can be susceptible to the belief that their assumptions about the world are objective, incontrovertible, absolute facts. There are people who believe that the possibilities of the State are unlimited, and available to solve all problems. It isn’t. The public and private sectors are both capable of, and culpable in, horrendous failures. The either/or positions tend towards the ridiculous.
We often find ourselves campaigning to protect the status quo, to stop the present outsourcing, contracting, or privatisation. We accept the premise that once a utility or service is gone, it can never come back. Our anti-privatisation campaigns often say so explicitly. Campaigning for the status quo is ludicrous, and driven far more by historical accident than meritorious deliberation. Whilst protecting what we have got matters, our policy making should be smarter. Otherwise, we find ourselves protecting public electricity generation in Western Australia whilst happy collaborating with private developers in Victoria.
Debates about what should be done by the public sector and what should be done by the private sector has been at the centre of Australian politics for decades. At every level of Government, in every state and territory, it has been a constant battle. Electricity, transport, telecommunications, childcare, postal services, community services, health, public safety. In every single case, the share of the work going to private and public sector workers is contested, and shifting. From the 1980s onwards, the transfers were overwhelmingly in the direction of work being moved from the public to the private sector, but in recent years the Queensland, Victorian, WA and ACT Governments have provided examples of nationalising some activities. Whilst a timber mill in Victoria or a crematorium in Canberra may not seem significant, they are an enormous departure because they run against the general trend of government in Australia for the last thirty years.
The Coate Report into the escape of COVID-19 from hotel quarantine in Victoria generated headlines mainly about Labor ministers escaping blame. However, the report itself was a forensic examination of catastrophic failure caused by the assumptions favouring the private sector over public sector solutions. The report found that nobody made a decision to outsource because everybody just assumed that is how things would be done. Realistically, the government probably would not have had the capacity to decide anything else. No Government in Australia has massive surge capacity in its workforce. This refers to the capacity to draw upon a variety of skill sets which are on hand and available to redeploy at a moment’s notice. It’s just not how things are done within a public sector focussed on minimising spending and maximising efficiency.
Instead, when there is a sudden, or not so sudden, need for a skilled workforce, the work itself is contracted out. Be it to build a bridge, secure hotel quarantine, or set up an IT system. Even the writing of the contracts can be outsourced. The contemporary public sector does not contain the skills to undertake those tasks. Not because Government is inherently without those skills, but rather because successive Governments have chosen not to have them in the first place.
The question for the left is twofold. First, do we desire our Governments to be more skilled and more capable, and second, how do we achieve that? Whilst the answer to the first question would seem to be self-evidently YES, we should also recognise how hard this can be for Ministers and their advisors to achieve. Tackling the assumption of outsourcing in the public sector is a massive undertaking. If we were to set a simple criteria, such as if the work is of an ongoing nature and taxpayer funded it should be done by a public servant, and asked our Senators in Estimates to question every public contract against that, the hearing would likely take months per department. Taking such a principle would also highlight the eccentricities of the status quo, and shame past Labor Ministers.
Whilst we should always listen to the Community and Public Sector Union and other unions covering public sector workers who advocate expertly for the workforce, we should also recognise that this is not a sectional workforce issue, but a problem that any and all Labor Governments will face. Without public sector capacity, all other policies will fail. Whilst the solutions are many and complex, I would also like to offer mine: a Department of Works.
A Department of Works may conjure images of men with shovels and occasional clipboards, but the reality would be far different. The policy of having a Department of Works would include two key features: first, that it would have a broad range of human and physical resources available to it (not as subcontractors, but directly employed and owned); and second, that it would bid against the private sector for all government contracts.
Why should a State or Territory Government who plans to continuously build new tramways for the next 40 years parcel that work into 3 year contracts to the benefit of multinational builders? Why should the actual people doing the concreting endlessly get laid off, spend time being unemployed, and then be re-hired at great expense for the next section? Why should the Government not just hire some concreters? There may be efficiencies either way, and by having a Department of Works as a bidder, we could test it. The biggest areas of the Department of Works would not be in construction, rather in human services and IT. The Government buys a lot of those services.
As the Department of Works develops broad expertise in house, it would also have the benefit of transferring public servants into and out of other departments, improving procurement, and displacing the creeping assumption of outsourcing. These workers would also prove a boon in a crisis, as they would be available to redeploy in an emergency. The on-call availability of thousands of counsellors, plumbers, social workers, call centre operators and drivers in a bushfire, flood or pandemic would have saved lives repeatedly in the last few months.
Finally, to make my proposal work, or even as a stand alone policy, we should mandate that public sector employment, freedom of information, and probity rules follow the money when the Government contracts out. The use of contracting out is often used to reduce costs by dodging probity rules, dodging paying proper wages and conditions, and transfer the cost of idle capacity by leaving workers unemployed for short, or long periods of time. The business continuity risk of the Government should sit with the Government, not the worker. If the private sector cannot deliver public sector standards profitably, it never should have got the job in the first place.
Daniel Gerrard is a member of the ACT Left. Twitter