THE IMPLICATIONS OF HIGH LEVELS OF PUBLIC SECTOR DEBT FOR ECONOMIC POLICY-MAKING: THE CASE OF SOUTH AUSTRALIA

Abstract: The relatively small and open South Australian economy has been facing the difficulties associated with the structural adjustment of its industry for over 15 years. In addition, the South Australian public sector has been contending with financial difficulties largely as a result of a reduction in grants from the commonwealth before the failure of the State Bank of South Australia. This paper reviews the growth and current level of government indebtedness in South Australia and discusses which group(s) is likely to bear the main burden of such debt. The main consequences of high levels of state public sector debt, including budgetary inflexibility, are also examined. The paper suggests that it will be necessary for relative wages and prices to adjust more freely if the negative impacts of an inevitable state government budgetary consolidation are to be minimised. If wages and prices are not free to adjust then unemployment will continue to take the brunt of the adjustment process. In addition, out-migration of businesses and people from South Australia will accelerate, leading to a further erosion of the taxation base. The State Bank indemnity arrangements and consequent levels of public sector debt incurred will require the state government to reduce the level and quality of services provided by the state public sector, sell state public sector assets and further improve efficiency and effectiveness. However, there are a number of important arguments why taxation should be an important means by which the South Australian government moves to retire public sector debt as soon as practicable. Not the least important of these arguments is the need to ensure accountability by elected representatives of government for their expenditure decisions.     

BUDGETING IN A TIME OF AUSTERITY: THE CASE OF THE ESTONIAN CENTRAL GOVERNMENT

Resulting from the global economic crisis, high budget deficits and debt burden characterise many economies looking for an exit strategy from current fiscal unbalances. The government of Estonia, having pursued a conservative fiscal policy for over a decade, reacted to the economic recession with radical budget adjustments, the latter constituting approximately 9% of gross domestic product in 2009. Consequently, Estonia took its chance and qualified for the euro in 2011. This study examines the behaviour of the Estonian central government and the basis of its budget decisions when planning drastic cost reductions through the theoretical lens of cutback management. The foremost results reveal that the crisis pushed the government to establish a different institutional framework that facilitated fast and effective decision‐making during the budget process. The savings proposals came from the Ministry of Finance; however, running a cash‐basis line‐item budgeting system in practice, the centre possessed only limited performance data for developing the proposals. Consequently, the long‐term impacts of the budget adjustments had not been assessed and are as yet unknown. A further conclusion is that the current budgeting framework should be revised and replaced step by step with a more advanced approach. Copyright © 2012 John Wiley & Sons, Ltd.     

THE STATUTORY CORPORATION—A NOTE ON THE THEORY OF AUTONOMY

Readers of this journal, especially those who watch developments affecting the machinery of government in Canberra, will no doubt have noticed the rehabilitation of the concept of statutory independence—a notion that, in some academic circles, had been virtually written off as having little or no relevance in the real world, where the general tendency has been towards an extension of government control and co-ordination of bureaucratic systems. Although it is much too early to evaluate, with suitable scholarly detachment, the significance of the administrative changes initiated since December, 1972, it seems a safe observation that for a small group of government agencies at least, the Labor Government has committed itself to the idea of independence. This much is clear from its declared aim of giving the Australian Broadcasting Commission more autonomy and the decision, recently announced, to reconstitute the Postmaster-General's Department into two separate statutory corporations.     

THE ROLES OF GOVERNMENT A PARTICIPANT'S PERSECTIVE*

Hasluck is unusual in the lengths he went to the define the responsibilities of the various offices in which he was involved. Many of the functions and processes of government have changed since Hasluck was an active participant in the political process. Interest groups have increasingly influenced political decision-making, organisations external to the public service now play a greater role in influencing the development of public policy, the operation of a number of areas of the public service has become more visible and open to external scrutiny, there has been a constant trend towards political appointments within the public service, and it appears unlikely that the emphasis on public relations and marketing techniques as an integral feature of government communication will diminish. Likewise, the demands on ministers' time have increased and, while it is questionable whether ministers now handle a larger ministerial workload than Hasluck did, it is doubtful whether very many then or since have had his capacity for hard work or for handing the matters which cross their desk without the support of a professional advisory staff. The functions and operations of government evolve and the adaptation of roles and functions may not necessarily weaken the effectiveness of government administration. However, the fundamental tenet of Hasluck's writings on the roles of government remains compelling: the participants in the various areas of government should have an appreciation of the constitutional responsibilities of their position, its relationship to other areas of government and the fundamental principles which are required to maintain the credentials of the office into the future.     

MINISTERIAL ADVISERS: THE EXPERIENCE OF THE WHITLAM GOVERNMENT*

Abstract: Following the election of the Whitlam government in December 1972 changes in the composition, work and style of ministers' offices were substantial. Evaluations of the emerging pattern conflicted, often quite sharply. This paper surveys the pattern of staffing introduced by Labor and examines in particular the roles of ministerial officers as political and policy advisers. The paper also discusses recent experiences with ministerial staff in the United Kingdom and Canada, and makes brief reference to the use of ministerial staff by the Fraser government. Assessing the effectiveness of ministerial advisers is not easy. No straight forward measures of effectiveness exist. It is argued that, despite the ambitions of some ministerial staff during the Whitlam government, the role of ministerial advisers was essentially limited and confined. Ministers found them useful but few found them overwhelmingly so. While the Fraser government has reduced the number and visibility of ministerial staff it has retained the institutional underpinning of Labor's system. In the search for ways of assisting political parties to govern and to respond to changing situations, it is likely that ministerial staff with ability to advise on policy will receive further attention in the future.     

THE FINANCIAL MANAGEMENT STRATEGY OF THE VICTORIAN COALITION GOVERNMENT

Abstract: This article reviews the budget sector financial management strategy of the Victorian Coalition government in the crucial period from its election in October 1992 up to the 1993–94 budget. The twin goals set by the Coalition were the elimination of the current account deficit, and the reduction of debt levels. Given infrastructure pressures, the debt reduction goal will be a difficult one to achieve. More precisely, it will be a difficult one to achieve without relying upon instruments such as assets sales, which the Coalition has viewed as artificial debt reduction techniques. The capital expenditure plans embodied in the 1993–94 state budget were not consistent with the debt reduction plans specified only months earlier by the Coalition. Victoria's debt levels are quite moderate even by OECD standards. What makes debt levels a real issue for the state is the narrowness of the tax bases of the Australian states, and the fact that Victoria is taxing at something like its maximum levels (at least, without coordinated multi-state tax increases). It is argued that, if the states could be confident that their revenue positions would hold firm (concretely, that revenue and grants as a proportion of GSP would remain constant), the appropriate debt policy goal for Victoria would be stabilisation — rather than reduction — of its debt/GSP ratio. However, the foreshadowed trend reduction of real commonwealth grants, as part of the so-called national savings campaign, makes it appropriate for Victoria — given the circumstances in which it finds itself — to target the reduction of debt/GSP levels.     

THE GOVERNMENT AND HOSPITAL COMMITTEES OF MANAGEMENT IN VICTORIA

Abstract: A new method has recently been introduced for selecting members of Victorian hospital committees of management: they are to be appointed by the Minister of Health, instead of being nominally elected by "contributors" to the hospitals. The 1977 Health Commission Act, which contains these new appointment provisions, gives the state government additional powers over the hospitals, and the power to appoint committees of management could contribute to this augmented control. The new method of selection, however, is expected to make little difference in practice to the committees. Neither the former Liberal state government, in framing the Health Commission Act, nor recent official inquiries have considered seriously the capacity of these committees as they are now constituted to maintain a high degree of hospital autonomy, despite the hospitals' heavy reliance on public funds. By leaving undisturbed these inheritors of the voluntary hospital tradition, the former Liberal government, though it has left its Labor successor with some new powers, has left it also with a potential obstacle to implementing the kinds of reforming measures recommended for the state's health services.     

REGULATION OF ASBESTOS THE MICROANA1YTICS OF GOVERNMENT FAILURE

This article analyzes the government's role in regulating asbestos-related health hazards in the United States. The U.S. government has served as both promoter and regulator of the U.S. asbestos industry, and this article examines the extent to which—in both capacities—it has hindered rather than facilitated the information dissemination essential to voluntary assumption of asbestos related risks. In documenting the behavior of the major government actors, this paper investigates the political and economic forces that have shaped U.S. asbestos policy. It shows how the Congressional transition from promoter to regulator of the asbestos industry can be explained by the susceptibility of political processes to transaction-cost augmentation by the bureaucracy.     

THE MEANING OF DEVELOPMENT ASSISTANCE

Prevailing paradigms of macro‐economic management and levels and distributions of poverty in some rich countries suggest that economic and strategic self‐interest rather than poverty reduction in poor countries are likely to be the primary objectives of much development assistance. The incommensurability of the paradigms of development discourse makes it unlikely that strongly held ideologically based positions on these matters will change quickly or easily. Moreover, non‐altruistic positions can be maintained more readily by virtue of the loose construction of international declarations such as the Paris Declaration. Based on different interpretations of the Paris Declaration, empirical evidence from Cambodia and Indonesia of donor opportunism that is designed to maximise aid control and aid distinctiveness for non‐altruistic purposes is presented. Recent sharp declines in donor legitimacy have made this more difficult to do, but even so, there have been no concomitant reductions in donor self‐assurance concerning their exclusive possession of the moral and technical high ground. Such behaviour is, however, increasingly resented particularly by government officials in lower middle‐income countries like Indonesia. Resulting relationships lack trust and are therefore unlikely to contribute optimally either to the realisation of non‐altruistic purposes or to poverty reduction. Copyright © 2011 John Wiley & Sons, Ltd.     

THE NORTHERN TERRITORY GOVERNMENTS CANBERRA REPRESENTATIVE

On 14 July 1980 an experiment began in Australian Federal-State relations which has been accorded little recognition. On that day the Northern Territory government opened an office in Canberra for its new "Canberra Representative". It was a step no State government had ever taken, although several had discussed such a move over the previous decade during general reconsiderations of the machinery of Federal-State relations. In particular, Sir Henry Bland's Board of Inquiry into the Victorian Public Service saw some benefits in the location in Canberra of one or more members of a proposed Commonwealth/State Relations Unit (now the Federal Affairs Division of the Premier's Department) in the State public service, although it chose finally not to recommend it     

THE DISCIPLINE OF PUBLIC ADMINISTRATION AND THE STUDY OF LOCAL GOVERNMENT

No doubt my colleagues in this venture will attest to the wide range of contributions which Robert Parker and Dick Spann have made to the field of public administration. I have benefited greatly from these contributions, as well as from discussions with both, in particular from those with Dick Spann during my period in the Department of Government and Public Administration at the University of Sydney. However, the breadth of their coverage has not been without some cost to the field, and in this paper I want to examine their influence on the area which I know best, that of local government.     

THE ADMINISTRATIVE IMPLICATIONS OF FREEDOM OF INFORMATION LEGISLATION

Abstract: Freedom of information legislation is now an item on the political agenda. In the debate about the scope of such legislation, however, some important administrative questions have been ignored. Relevant overseas experience, particularly that of North America, has not been given the attention it deserves. By 1972 the Labor Party had made "open government" an electoral issue, although four distinct notions were involved in this concept, namely administrative review; public comment by public servants; more helpful institutions; and autonomous access to information in institutions. However the efforts of the Labor government during 1972-75 to implement freedom of information proposals foundered partly because issues of procedures, cost and personnel were not perceived as being salient; and the situation has not changed much since. Questions about the administration of freedom of information legislation are discussed in relation to the recommendations of the Coombs Report, and it is argued that the matter needs to be approached in new ways, one of which is through action research.     

THE ROLE OF THE JUDICIARY IN RELATION TO PUBLIC ADMINISTRATION*

The relationship between the judiciary and public administration is founded in the constitutional principles which lie at the basis of our system of government. The three branches or arms of government, as they are known to constitutional law, are the legislative, the executive and the judicial. They are said to be equal and coordinate. There is a complex constitutional relationship between the three arms of government which does not always follow a consistent pattern. It is marked somewhat paradoxically both by mutual independence and interdependence. Public administration is carried on by the executive branch.     

Management and change in northern Nigerian local government

This paper looks at some recent changes introduced by the Federal Government of Nigeria which seek a return to civilian rule in a stable polity. A first step in this policy has been completed with the election of chairmen and councillors at the local government level. The stated purpose of this initiative is to encourage ‘grass roots democracy’, which is expected to mobilize local action for urban and rural development. It is envisaged that local politicians and local administration will work together to this end. The paper concentrates on the consequences of the policy for the management of local government in Northern Nigeria, in which the predominant need is for rural development. The resource and management issues that arise for local government from the introduction of this polity are discussed under the following headings: finance, material resources, human resources and political relationships. The measures adopted appear radical, but have not led to a situation in which local government can easily predict what resources will be available to it. The question that is addressed is how, in an uncertain environment, local governments might use the powers and resources that are within their control to facilitate rural development in the Northern States. Suggestions are made as to what a management agenda should be and how this might be achieved through appropriate management systems and improved training.     

THE "NEW ADMINISTRATIVE LAW": SOME ASSUMPTIONS AND QUESTIONS

Abstract: Sweeping changes in administrative review legislation and procedures have occurred in Australian Federal government very quickly and with little debate. There have been several assumptions underlying the proposals for administrative law reform, including the notions that government has expanded greatly, that it has intruded into citizens' lives, that it is scarcely restrained by parliament, and that the specialist administrative tribunals established at various times are only partly effective. While these assumptions are all correct in certain respects, they do not necessarily support the demands for administrative law reform in the manner and to the extent that has generally been proposed. Closer examination of these assumptions suggests that comprehensive administrative review might itself lead to further expansion of government; that political decisions will have to be made about degrees of intrusion by government; that political avenues for redress of grievances should not be ignored, and could possibly be developed further; and that the need to prevent administrative errors is at least as great as the need to correct them after they have occurred. There is a good case for comprehensive administration review, but it needs to be examined more closely so that future problems can be anticipated and avoided.     

THE POWER OF THE PURSE AND BUDGETARY ACCOUNTABILITY: EXPERIENCES FROM SUBNATIONAL GOVERNMENTS IN CHINA

Accountability is the cornerstone of fiscal administration. This research studies the relationship between accountability and the sharing of budgetary power. We found that the accountability in China is supported by the superior of bureaucratic power, instead of the comprehensiveness of various accountability components. The implication is that the accountability is facilitated in terms of emphasising to whom government officials are accountable within the chain of command, reducing goal conflicts and improving strategic goal attainment. However, it is hindered at the same time in terms of lacking evaluations perceived to be impartial, limited room for democratic accountability, over‐implementation of policies at all costs, and weak comprehensive awareness of ‘accountable for what’ (as long as it is a policy direction from the top). The structure of the power of the purse both enables and limits the tone and terrain of budget accountability in particular and government accountability in general. Copyright © 2011 John Wiley & Sons, Ltd.     

The Parliamentary Party

The Conservative parliamentary party will fulfill three important functions for any incoming Conservative government: it will be the focus of attention for the national media; it will be the bulk vote that will deliver its legislative programme; it will form the talent pool from which members of any incoming government will be recruited. A majority Conservative government could see a majority of its MPs newly elected, with more Conservative women and ethnic minority MPs than ever before (although there will be little change in the socio-economic background of their MPs). These new MPs will present problems in terms of party management, although they will be less likely to rebel than longer-serving MPs. There are also relatively few signs of discontent among incumbent Conservative MPs (the article identifies the most rebellious Conservative MPs). Any new Conservative government will also have to deal with a reformed House of Lords, in which it will no longer have a majority.     

THE PRIVATISATION OF HUMAN SERVICES IN AUSTRALIA: HAS IT HAPPENED?

Abstract: The privatisation of Australia's public services has been one of the major challenges facing public administration since the early 1980s. Its enthusiastic proponents and their equally fervent opponents have generated considerable controversy. Yet its impact may have been exaggerated. A number of writers have deplored its spread in Australia's human services. Yet their evidence for privatisation does not stand scrutiny. As well, if privatisation had occurred, it would have had an impact upon the flow of public finance and that should be reflected in public finance data. An examination of that data provides almost no support for the claim that the 1980s saw significant privatisation of Australia's human services.
The current debate on privatisation … indicates a movement to return social welfare provision to sectors or systems other than government (ACOSS 1989 p.6).
The re-emergence of the voluntary sector has been facilitated by public policies designed to transfer responsibility for welfare services from the government to the non-government sector (Baldock 1990, p. 109).
with the more systematic transfer of services to the non-governmental sector (Baldock 1990, p. 113).
over the past two decades … a number of functions such as service delivery and management have been transferred from the state in a way that in most terms amounts to privatisation (NCOSS 1989, p.2).
This rebirth of the non-government sector can arguably be seen as a privatisation of the welfare state (NCOSS 1989, p.22).
Human services in New South Wales have been and continue to be the subject of a wide range of reviews intended to produce changes which fit under the general rubric of "privatisation" (Evatt Research Centre 1989, p.208).
The moves towards privatisation, if they are to continue, will have serious long term consequences (Graycar & Jamrozik 1989, p.296).     

THE TRIUMPH OF ECONOMIC RATIONALISM: THE TREASURY AND THE MARKET ECONOMY

The 1980s have seen the triumph of economic rationalism. Greater efficiency has become a sacred goal. Increased competition and the unlocking of market forces, we are told, are the key means to obtain it. Proponents of economic rationalism insist that the public sector is riddled with inefficiencies. The private sector, by contrast, is self-evidently superior. To the extent that the private sector often operates less than optimally, a major reason is the plethora of perverse governmental regulations which hamper its efficiency. Despite the problems, the public sector needs to model itself wherever possible on the private. And where public sector activities can be or are being done in the private sector, then the public sector should surrender such activities. The inevitable result will be an increase in net economic welfare: the economy will become more dynamic and scarce resources will be allocated more efficiently. Such is the rhetoric of the economic rationalists.     

THE INFLUENCE OF E‐GOVERNMENT ON ADMINISTRATIVE DISCRETION: THE CASE OF LOCAL GOVERNMENTS IN EGYPT

One important but often understudied area of research in public administration is the effect of e‐government on administrative discretion. This article examines e‐government factors that influence administrative discretion through a survey of local governments. The focus of this study is on Egyptian local governments, which are using e‐government to modernise public service delivery. Through a survey of administrative officials in these governments, this study found evidence that e‐government factors of collaboration and organisational change influenced administrative discretion. Other common factors noted in the literature such as size of the local government and demand by citizens for e‐government did not register an effect on administrative discretion. The results of this study imply that local governments should do more to enhance e‐government to reduce administrative discretion, especially in the area of increasing collaboration. Copyright © 2011 John Wiley & Sons, Ltd.