The Price of efficiency?

By MARK SMITH

Can Jacinta Price deliver a more efficient Australia?

Peter Dutton thinks she can. As he surges ahead in the unreliable opinion polls Mr Dutton has hit the podcast circuit to flag that Trump is already having an international impact in his first few weeks in office.

His decision to mirror the Elon Musk appointment to make government less inefficient by allocating a new portfolio to the increasingly emboldened Senator for the Northern Territory, living in Alice Springs, suggests a Dutton Coalition Government would be a Trump sheriff. But to what extent?

As moderate Liberal heavy weights bow out, Simon Birmingham, Marise Payne, Dutton’s cabinet may be increasingly conservative.

It wasn’t all that long ago that we had a popular Prime Minister from Queensland. He is now an unpopular Ambassador in Washington.

Genuinely streamlining government processes and simplifying unnecessary bureaucracy layers would be welcome. But how can this be done?

What can Senator Price actually do?

Can departments be merged or abolished?

What services should be managed by the public service and what should be outsourced to contractors?

What role can AI play? How can this be done to ensure data sovereignty and security?

Can the states do more or less in some areas?

Can money actually be saved and directed towards services and infrastructure or paying down debt?

But wait. Isn’t that the job of the Treasurer or Treasury or the Finance Minister or the Expenditure Review Committee of the Cabinet with support from the Assistant Treasurer, Financial Services Minister and other junior ministers and all of their private office staff?

In recessions and financial crises Prime Minister’s often set up razor gangs to ruthlessly cut government spending and waste. Short lived moments of discipline akin to New Year’s resolutions, only to disappear into the ether as election day comes closer.

Leading economist Saul Eslake headed the audit commission for incoming reforming Victorian Premier Jeff Kennett in 1992-93.

The former ANZ and Bank of America, Merrill Lynch Chief Economist told me in an exclusive chat a Musk style approach could be disastrous for Australia.

“I’m personally appalled at the way in which Musk is going about what he’s doing – it is so vengeful, ideological and arbitrary. And it may end up being tied up in litigation for years. I would hate to see a high net worth individual, being given the same role in Australia.”

In terms of Senator Price’s potential task, Mr Eslake suggests the options for Federal Government efficiency are narrow.

“With the exception of defence, the Australian Federal Government is essentially a cash collection and distribution machine. Wages and salaries of its 275,000 or so employees account for only about 6½% of total federal payments," says Mr Eslake.

“Slashing 36,000 public service positions as per Mr Dutton’s repeated comments would not amount to a hill of beans in terms of reducing federal spending or restoring the budget to surplus – and that’s without considering that at least some of those positions would likely be replaced by ‘consultants’ who cost more as we saw when that happened under the Coalition between 2013 and 2022.

“Most of what the Federal government does is hand out cash – to the states and territories, which is by quite a large margin the biggest single expenditure item in the Federal budget, to individuals and families through aged pensions and other benefits such as Medicare rebates and PBS subsidies, to community and other organisations that provide services, and to the aged and disabled; and to businesses through subsidies and tax breaks. So swingeing cuts in Federal spending will always be particularly difficult.”

Mr Eslake suggests AI may have a role to play: “I suspect there is scope for AI to be used to streamline various forms of service delivery – just as other developments in IT have enabled, for instance MyGov and Single Touch Payroll for tax administration, but they need to be implemented carefully and with appropriate safeguards.”

Mark Smith is former SA Government policy adviser.