25
Nov
2014

Victorian Election

It presently looks like Labor will win the Victorian election on Saturday even though the first two articles below suggest that this poses a big risk for the economic and social development in the state. This is illustrated by the report on the extensive influence of the CFMEU in the third article, which is the  front page lead of today’s Fin Review. Relevant also is the fact that, even though last Sunday’s Age thought readers should vote Labor, its showed limited enthusiasm and expressed reservations about leader Daniel Andrews.

Many puzzled by the polling showing Labor ahead by 4 percentage points on a TPP basis say that the Napthine government has “done nothing wrong” and that the Victorian budget is “in good shape”. True, but the question is what positives has it implemented to promote the cause of liberalism and private enterprise at the state level?

This is not the place to attempt a detailed analysis of why the Liberals have failed to perform in Victoria. But where first Baillieu and then Napthine seem to have missed out is in implementing a more competitive framework designed to improve the quality of services. There has been dissatisfaction with standards of government services, such as in education and hospitals, but a failure to further encourage a greater role for the private sector in many areas. Such an approach would have taken a helpful leaf out of the Kennett book, but both of his successors judged it too risky to progress down that line. The Coalition has given the impression of being risk averse.

This is reflected in the failure to deal with the union problem. The introduction of a building code has helped in the building sector but that is confined to one area and then only to government building projects. That Andrews has said he will abolish the code confirms the riskiness of electing Labor, which would presumably also reverse the recent decision to involve state police with federal police in an investigation of  criminality in the union movement. That decision raises the question of why the State government did not itself start such an investigation some time ago.  Mick Gatto  may be a better known name in Victoria than Denis Napthine.

The frequent battle with unions in many other areas, the latest being paramedics, has given the impression of a government prepared eventually to concede if pushed hard enough. But the government has a weapon if it has the courage to use it viz the threat to adopt policies designed to increase the proportion of government services provided by the private sector. The proportion attending private schools and being treated in private hospitals has been steadily increasing and is now around the mid thirty percentage. That process could be speeded up under a competitive environment which unions resist but which benefit users.

Another example of risk averse policies is in the environment area. As the Reith report showed, the risk of damage from fracking is minimal. What was required was leadership to show that – and the benefits that would flow. Even Obama did not try to stop fracking in the US and its extensive development there has been of enormous benefit. Victorian (and NSW) residents are missing out badly because our state leaders have failed. Such failures are likely to continue in Victoria under a Labor regime but there should be more chance of policy change if the Coalition is returned.

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