Malcolm Turnbull has signalled he is prepared to adjust or drop policies that aren’t working as intended, saying the conventional criticism of shifts in government position as “backflips” is “rubbish”.
After naming his new ministry yesterday, the prime minister delivered a series of media interviews this morning laying out more details of his government’s agenda.
Turnbull has declared his desire for Australia to be “more agile” and yesterday said he was shaping “21st-century government and a ministry for the future”.
Asked by Michael Brissenden on ABC Radio if GST was likely to be high on the agenda, Turnbull answered that the reform program needed to be wider than just tax reform.
He also said policies should not be doggedly pursued if they prove to be ineffective.
Here’s Turnbull, worth quoting at length as it gives some insight into his thinking about agility.
Let’s get back to fundamentals. We have to lift our productivity. We have to be more innovative, more competitive, we’ve got to be more productive. We’ve got to do that because otherwise, our living standards will decline. That’s the challenge ahead of us.
… We’ve got to look at all of the levers and measures we can use to improve incentives that make us more productive. Greater participation of women in the workforce, a more innovative business culture, better support and better outcomes for startups – there are a whole range of things that we have to do and we’ve got to look at measures across the board. You can say that means you want to do X or Y about the GST. That’s not necessarily the case. There are many different approaches you can take. The object is, and it’s a bit like the climate change issue – in climate change policy, the object is to cut emissions. In economic policy, the object is to ensure a higher level of economic growth and higher living standards. That’s the objective.
There are many different routes you can take. You’ve just got to choose one, or a series of routes, and then recognise that you must constantly monitor them and adjust if they’re not performing as well as you think. This is a critically important point. When governments change policies, it’s often seen as a backflip or a backtrack, or an admission of error. That is rubbish. We’ve got to be agile, all the time.
The emphasis is added there, although Turnbull was audibly insistent in saying “That is rubbish” during the interview too.
Turnbull is signalling he is willing to change tack on economic policy. This is refreshing, and something Australia could have benefited from in recent years.
The Abbott government came to office promising to end the “debt and deficit disaster” of the Labor years. But in the years Joe Hockey was treasurer, the growth outlook deteriorated and commodity prices were falling. This year, it has become apparent that China, Australia’s biggest trading partner, was not growing as quickly as its official target. For a mid-sized, open, exporting economy like Australia’s, these have material impacts not just on the budget but on businesses and job creation.
While global economic forces were massing against the Abbott government’s deficit reduction mission, none of the emerging facts were sufficiently harnessed by Abbott and Hockey to explain the realities that the Australian economy was facing. Hockey did talk about the decline in the terms of trade and the fall in the iron ore price, but some of the wider challenges in the global outlook were never really part of the conversation. This inability to engage with these real issues that have real consequences was bizarrely, and memorably demonstrated by Abbott when, asked in July about the crisis over Greece’s future in the Eurozone and China’s imploding stock market, he responded with an answer about the grocery code of conduct.
Will this change much in a Turnbull government with Scott Morrison as treasurer? We’ll know soon enough. Turnbull is keen to talk about the opportunities in a globalised world. He says he wants to respect the electorate’s intelligence; so surely he must be prepared to spell out the risks too.
There are some inherent challenges in Turnbull’s plan for “agile” government. Just because changing tack is “rubbish” doesn’t mean the attacks about policy failure and “policy on the run” won’t come from his opponents. We’ve yet to hear much from the newly-appointed innovation minister Chris Pyne.
And besides, government bureaucracies are slow, lumbering beasts no matter who is in the prime minister’s office.
But Turnbull’s professed determination to drop or change policies that aren’t working will be a breath of fresh air to the business community, which works like this day to day anyway. Modern companies adjust strategy, marketing mixes, cost inputs, and prices depending on what the data’s telling them and the feedback they’re getting from the market. Bringing the same kind of responsiveness to policy is an exciting vision for government.
Business Insider Emails & Alerts
Site highlights each day to your inbox.