November 12, 2018   

NICK CATER                

Public servants and our two most socialist state governments are locked in cycle of co-dependence that drains capitalism.

Four years ago Daniel Andrews promised to make Victoria “the nation’s engine room for job creation” without explaining how. Which taxes might he cut? How much red tape would he do away with? Would he ease the crippling burden of gas prices by declaring that Victoria was open for drilling?

Sadly it was none of the above. Instead he set about creating jobs in the only way Labor state governments know how: by expanding the public surface.

The latest public service employment statistics from the ABS make depressing reading. Some 235,000 public service jobs have been created across the country since the global financial crisis and nine out of ten of them are employed by state and territory governments.

In the four years since the Andrews government came to power, Victoria has run neck-and-neck with Queensland in the public service growth stakes. Public service jobs have increased by 11 per cent in both states over that period. Next comes WA lagging way behind at 3.8 per cent with SA and NSW at the back with 1.8 per cent and 0.8 per cent respectively.

To the extent that Labor is still the workers’ party, it is the party of people who work for the government or in industries funded by the government.

As Robert Carling and Terrence O’Brien wrote last month in a perceptive report for the Centre for Independent Studies, Labor is overwhelmingly favoured by people who take more from the government in fiscal terms than they put in.

There are many diligent and industrious public servants, many of whom perform thankless tasks working difficult hours protecting the safety of their fellow citizens or caring for the sick. But as Carling and O'Brien point out, public servants are people who vote for a living. They are not inclined to vote for tax cuts, austerity or smaller government for obvious reasons.


“Government may have grown to the point that there is a large segment of the population — perhaps even a majority — facing incentives to ‘vote for a living’ rather than to ‘work for a living’ by adding value to resources through market-tested employment in the private sector,” they write.

Public servants love economic downturns and the Keynesian rush of blood they provoke in socialist politicians. The private sector shrinks in a recession, but the public sector expands.

The Commonwealth’s wage bill rose 48 per cent under the Rudd-Gillard-Rudd administration, four times higher than inflation. The excuse was the global financial crisis which, according to Kevin Rudd, was the cue for the government to save capitalism from itself.

Most of the new opportunities for public servants have been created by state and territory governments. A quarter of a million public service jobs have been created since the financial crisis in state and local government. The combined payroll bill has risen by 75 per cent since 2008, three times the rate of inflation. Jobs growth has been twice as fast in the public sector than private.

Victoria is the champion of them all. The state public service has grown by 25 per cent in the Garden State. The ballooning of the public sector began with the Bracks and Brumby administrations. It paused briefly between 2010 and 2014 when the Coalition was in power. In the past four years, however, its taken off again with vengeance.

State Labor governments have grown cynically adept at playing to the public service vote. They play on pubic fears but bogusly claiming that the public hospital in {fill in local suburb} is going to be closed down. Your local school is in danger of becoming a crumbling wreck under the Coalition, they warn solemnly. Welfare and disability services will be cut.

These are outright lies, of course. The statistics show that spending on health and schools grows as fast under Liberal governments as it does under Labor, and sometime faster. It is not by chance, for example, that Tony Abbott as Health Minister was called the greatest friend Medicare ever had.

Make no mistake, however. The stated purpose of Labor’s policies, to help the downtrodden and dispossessed, is not their real intent. The real aim is to keep the professional class onside, because that’s where their votes came from.

We should remind ourselves of wise words of Gough Whitlam’s private secretary Peter Wilenski who wrote in his memoirs that the first beneficiaries of any government program are the people hired to to administer it. 

Voting for a Living: A Shift in Australian Politics from Selling Policies to Buying Votes? by Robert Carling and Terrence O’Brien is published by the Centre for Independent Studies.


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2019 by Menzies Research Centre