Doing better than the previous government is often enough. Not this time
21st February 2023

In December, Attorney-General Mark Dreyfus made one of those announcements that, while it will ultimately affect the lives of thousands of people, was barely noticed. He was abolishing the Administrative Appeals Tribunal and replacing it with something new.

Dreyfus’ main justification was that the AAT had been irredeemably politicised, with many Liberal associates – including former MPs, candidates and staff – appointed, sometimes “with no relevant experience”. The opposition accused him of “settling scores”, and said his aim was clear: he would stack the replacement body with Labor mates.

Illustration by Jim PavlidisCredit:

Dreyfus’ critique was probably fair. But it was interesting, too, for the light it sheds on an important aspect of the new government’s method. The policies Labor has pursued so far have often seemed like small, early steps: they may or may not lead somewhere significant. Here, though, the government was literally remaking an important institution. Whatever policies it enacts separately – and whether they are ambitious or not – this single change will redirect the operation of power, filtering into everyday events.

Three weeks ago, Arts Minister Tony Burke revealed a new arts policy. More comprehensive than many in the sector had expected, it included the remaking of a central funding body. Here is Burke introducing the new institution: “At the centre of the reform is a reimagined Australia Council. The new body will be known as Creative Australia. The [former arts minister George] Brandis cuts will be returned in full.”

The restoration of funding is a good thing. Still, it is worth noting how central the political messaging is to both announcements. Liberal failure is used as a justification for creating something new; and the creation of that new thing doubles as a reminder of Liberal failure. A dark past serves as high contrast for a bright future.

Which brings us to the most important example, being pursued in ways both more and less subtle than the above: the slow build-up to the review of the Reserve Bank, due to be handed to the government next month.

Method in his gladness: Anthony Albanese’s government has been productive, but quietly so.Credit:Alex Ellinghausen

There are good reasons for the review. As economist Henry Ergas has pointed out, there is the difficult question of how to keep an institution – one that can seem almost mystical – both independent and accountable for meeting its objectives. Another is the make-up of the board. Former Reserve Bank governor Bernie Fraser has said former union chief Bill Kelty was always the best on his board at predicting wage rises. There are no unionists currently on the board, which is arguably a result of John Howard’s success at exactly what Labor now seeks to do: remake national institutions and shift assumptions about who deserves power.

It is unlikely these were the treasurer’s only motives. The review was foreshadowed by Jim Chalmers in opposition, and confirmed in government. With inflation and rising interest rates charging towards the new government, the possibility of economic credibility being derailed so early must have been terrifying. The review offers inoculation. Because of the coded language in which economic debates take place, the government will not need more than a line or two.

This is not the only piece of the puzzle.

In September, the term of the Reserve Bank Governor, Philip Lowe, ends. Jim Chalmers says that the government has not made up its mind whether to re-appoint him and will wait for the review to make sure whoever is appointed can make the necessary changes. It is hard to see Lowe being encouraged by those comments: he has been at the RBA for decades. At the very least, there is a sustained distancing operation going on: never has a government seemed quite so attached to the fact of the Reserve Bank’s independence. In Chalmers’ much-discussed essay in The Monthly, he referred to “the independent Reserve Bank’s rate rises”. Last week he spoke of the “human consequences for the decisions that the Reserve Bank takes”. And then there are the Labor MPs more or less calling for Lowe to go.

Winds of change: Treasurer Jim Chalmers must decide whether to reappoint Philip Lowe as chair of the Reserve Bank.Credit:Alex Ellinghausen

Unlike the other institutions Labor is remaking, this is not exactly about the Liberals. But if the review is significant, and Lowe goes, these changes will serve much the same political purpose: to suggest that one regrettable period has ended and another has begun. This is not a matter of logic so much as political atmospherics. If inflation is on its way to being under control, if a full-blown recession has not hit, there will be a sense – illusory to be sure – that Labor’s economic reign, with responsibility for real reform, has just started.

Because the reality is we are still deep in the period where the focus is on the previous government. Rocks can be thrown without much chance of them rebounding. In the creation of new influential bodies this is particularly true: new institutions have not been formed or have not operated for long. But it is true more broadly: so far, the government has largely been judged on its ability to identify what is wrong.

Which brings us, finally, to the government’s “safeguards” mechanism, one of its climate policies. The most important thing to be said is that criticisms of this policy are both credible and significant. Add to that the list of supportive organisations not exactly famed for their constructive approach on climate – like the Business Council of Australia and the Australian Chamber of Commerce and Industry – and scepticism rises. Part of the problem – as with many issues in this government – can be traced back to Labor’s small-target approach in opposition: as others have pointed out, Labor borrowed this policy from the Liberals in order to avoid political attack. Perhaps this, too, is an area where completely remaking things would have been better.

What is remarkable about the debate so far is how successful Labor has been in turning it into a test for the Greens: will they accept the policy or block it as they did the emissions trading scheme in 2009? Why – as informed observers like Ketan Joshi have asked – is the pressure not on the government, instead, to come up with better policy that might really do what is needed to prevent global heating getting out of control? There are questions to be asked about the Greens’ tactics – but it seems odd they have become the focus.

In some areas, doing better than the previous government is a worthwhile measure. On climate policy, it isn’t. The government may have forgotten that. Others – including the media – should not.

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