JOHN AUSTEN. Revolving doors at the infrastructure club

Infrastructure Australia should be made a Commission and do its work in public.

 Earlier this year there was controversy about infrastructure club ‘revolving doors’ – movement of Ministers and officials between the public sector and organisations whose members can benefit from Government spending.

John Menadue also identified senior public servants sitting on the (advisory) board of a self-styled thinktank/executive network – Infrastructure Partnerships Australia – regarded by some as a lobby group.  Partnerships claims this ‘shapes our research and informs our advocacy’;

Yet (some same) public servants don’t sit on Infrastructure Australia’s 12 member (!) board presumably for fear of conflict of interest!  Infrastructure Australia’s people don’t sit on Partnerships board also presumably for the same reason.

There are numerous other governance issues in infrastructure advice –  such as a bizarre arrangement of Infrastructure Australia being (financially) ‘independent’ of a Government which is – and should remain – its only source of income.

All supposedly compliant with guidelines.

Then there is the growing number of ‘Infrastructure state agencies, differing from Infrastructure Australia and each other.  The common elements are the name and their government’s claim of independence.

Maybe if the parties treated us to a well-rounded debate about infrastructure, corrected misconceptions such as about ‘road users paying their way’/infrastructure ‘deficits’, or vigorously called for reversals of appalling policy such as the anti-competitive restrictions on Newcastle port we could be a little relaxed about this.

But there are no such rejoinders.  Rather the public is fed one-sided calls for more infrastructure spending for any reason and for the  infrastructure club to get hold of more money to spend even more.

There are  serious governance problems. There are advisory problems. It is not unreasonable to suppose some connection.

Even some who call for more spending say there are problems.  Former Minister Albanese, who set up Infrastructure Australia, recently commented on the appearance of political interference.  He cited the case of the organisation endorsing a project in South Australia only after the recent election – which changed government to the conservative parties – and the Commonwealth simultaneously agreeing to provide funding; a contrast to the treatment of Queensland’s Cross River Rail in Labor held Queensland where a positive recommendation was withdrawn after the arrival of a conservative Government in Canberra.

Then there were reported comments from Infrastructure Australia that it is good to see NSW ‘jumping the gun’ on a rail corridor.

In these circumstances it is not unreasonable to expect ‘reform’ proposals – usually for even more ‘independent’ infrastructure bodies!

Yet such proposals fail to address a core problem – they fail to apply the fundamental idea of public ‘independence’.  This causes confusion and loss of confidence in advice.  A short addition to every ad-nauseum claim of ‘independent’ would start to fix the matter; independent from  whom and what?  The public could then see any self-interests at work.

The underlying concern about revolving doors  is that Caesar’s marital test – to be above suspicion – is not met.  This needs to change.

Yet there has been little response to the revolving door problem.  This is typical club behaviour – confront any challenge with ‘sitzkreig’.  It won’t change soon.

As the powers-that-be seem uninterested in matters of principle perhaps some practical suggestions are more acceptable.

In 2016 Luke Fraser and I suggested proposals for Commonwealth spending on major infrastructure projects be subject to public inquiries for Parliament.

This was based on three concerns:

  • Inadequate public assessments of multi-billion dollar spending proposals;
  • Claims some proponents – including States – are less than completely open;
  • A Constitutional requirement that Commonwealth engagement in most infrastructure matters is for Parliament not the Government.

Our expectation was that outcomes improve when all is in the open rather than behind closed doors or where recommendation making is claimed to be ‘confidential’.  We can add the banking Royal Commission to evidence supporting our view.

Fortuitously, a public inquiry process sits well with reforming Infrastructure Australia to a proper relation with the Commonwealth – of being an adviser that is, and is seen to be, independent of private and State interests in money for infrastructure.  It needs to be independent from them, not from the Commonwealth.

Infrastructure Australia should be reconstituted as a Commission similar to the Productivity Commission – which has 12 commissioners.  It should not have a governing board and CEO but a chair and a head of office.  Its commissioners should take individual responsibility for assessing particular projects.

Its work – assessment of projects and research – should be done in public and rely on public information.   It should issue draft reports.  Full reports should be published rather than cursory summaries.

This would deal with the question of visible ‘independence’ from both private and political influences.  Such influences would be open to scrutiny.  The revolving (or no) door concern would lose some force.

No doubt there will a public and private briefings against this idea.

Some may claim this will overwork the organisation.  I doubt it.  The fear of public embarrassment will lead to better – if fewer – project proposals.

Others will claim work will dry up since proponents – in most cases States – will be reluctant.  So be it.  Those who avoid a public process are unworthy of public monies – which is what Commonwealth funds are.  The Commonwealth should not financially reward secrecy – least of all by State Governments.

Yet others will claim this will open the door to argumentative submissions by e.g. environmental or local lobbyists.  So what?  A good enough case will stack up.

So much for Commonwealth infrastructure advice.

What for Infrastructure Partnerships Australia?  If it was obviously without links to the public sector this would be none of my business.  But given its board includes officials I  am concerned.

There are notable ‘absences’ from its board: officials from States other than NSW and Victoria; anybody from Infrastructure Australia.  It should have representatives from every jurisdiction or none.

If officials are to be on its board, they should demand at least that its membership should be published.  This is the case for the Australasian Railways Association and another industry ‘peak’ body with officials on its Board – Roads Australia.

Infrastructure organisations now include public sector governance ‘novelties’ without adequate explanation.  Infrastructure advice – affecting millions of people and multiple billions of public monies – is not the place for such experiments.

Standing infrastructure advice for the Commonwealth should be provided by more usual processes – Infrastructure Australia should be replaced by a Commission.

John Austen is a happily retired former official. He was Director of Economic Policy for Infrastructure Australia from its inception in 2008 until his retirement in 2014.  


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