Recalling the Debate

Labor's defeat at the last election was one of the most comprehensive in NSW's history.

The anger and resentment had built up to such a degree that various people spoke of Labor being all but "wiped out" at the election,

It is at times like that, when a government has clearly been roundly condemned by a population well before an election, that fixed terms really grate.  Of course, had there not been fixed terms, there is no way that a Labor Premier would have called an election, so the fixed term question was moot.

The only way a population can successfully demand an election is through recall. And, Barry O'Farrell was quick, in Labor's final years, to promise to investigate the possibility of NSW constitutional change to allow recall elections.

I've written about that promise here.

Three constitutional experts were gathered and tasked with putting together a report on the feasibility of recall elections in NSW, and their report was publically released earlier this week. It can be found here.

The report is some 150 pages long, and is quite detailed.  That said, it is very readable, and worth spending some time looking through if you are interested.

You'll notice the date.  It is clear that the report was completed some time ago, but was not released to the public until an enquiry by the Herald.  That may give you some clue as to what the Coalition government intends doing with it.

The report spends some time looking at NSW's history as a democracy, and then has a detailed look at the history of recall elections in other jurisdictions.  It also provides a fascinating account of the recent Wisconsin and California recall experience.

It also spends some time looking at the way that MLC's and MLA's can be dismissed from service.

The report's conclusions are the most interesting part of the report, and it is here that I was to focus my attention for the moment.

The first conlusion reached by the panel is there is little point in recall elections for specific MLA's or MLC's.  It is rare that an electorate's dissatisfaction with a local member could be sufficient to justify the recalling on that member excepting in circumstances where ICAC or the parliament's disciplinary bodies could adequately deal with the issue.

Given the nature of our party representation, it is also difficult to envisage how such a move could have any practical effect except in a knife-edge hung parliament.

At the upper house, additionally, there is substantial risk of any such provision being misused by a ruling party to "whittle down" minor party representation.

This is not an unusual position - many of the recall election provisions in other jurisdictions relate to democratic systems with a powerful executive, and the recall is usually for the Governor or President him or herself.

In the Westminster system, where the Premier is simply the member of the lower house who can command the house's confidence, any such provision would not really make a lot of sense.

On the other hand, the panel favoured the introduction of recall elections for the entire Legislative Assembly and Legislative Council. The model proposed is as follows:

- A recall election petition can be commenced through the lodging, by 500 person eligible to vote, of a petition.
- The petition cannot be lodged less than 18 months after the last election.  If a recall election is to be called, all procedural steps must have been taken place no less than 6 months before the next election.
- There is no need for there to be any particular reason for the petition.
- "Signtures" can then be collected online (with telephone and mail options) for a period of 60 days.
- For the petition to be successful, 35% of eligible voters will need to sign it, as well as 5% from every electorate.
- If sufficient signatures are collected then a recall election will be held in conjunction with a new election. In other words, the electors will cast one vote for whether the government should be recalled, another vote for who should be their local representative, and another upper house vote in the usual fasion.  Of course the second and third votes only come into play if the first vote is successful.
- Only those MLC's whose term was due to expire at the next election are forced to re-contest.

On the whole, the proposal seems like a sensible one. For me, the only concern as far as the model goes is the 35% figure.

It is an extraordinarily large number.As of the 2011 election, there were 4 635 810 people on the electoral roll in NSW.  This means that the petition would need 1 622 533 signatures.  By way of comparison, in 2011 a total of over just 1 900 000 chose the LNP as their first preference in the upper house.

Taken from the NSW Electroal Commission Website

Given the scale of the blowout in the last election, that must give anyone planning any such petition concern.  The number is even more daunting when you consider that a significant proportion of that 1 900 000 would have chosen the LNP as a default, because they were told to or because it was the only party the knew.  How many of those people would go to the trouble to sign a petition?

When one considers how difficult it can be to get Australians interested enough in politics to actually do something, I have serious doubts as to whetherthe 35% mark could ever be reached.

In any event, reading the report has only strengthened my view that George Williams' reticence about recall elections is entirely justified

At the end of the report, each of the 3 panel members wrote a few pages explaining why they have come to the view they have.  Mr William's view is that the cons (specifically, the effect on long-term decision making, the insurmountable practical difficulties, the susceptability of recall elections to overtly strategic purposes and the fall-off in public demand) mean that the change should not be made.

The other concern I would add to that is that of a perpetual campaign.  It is good and proper that an opposition hold a government to account by enthusiastically and forcefully seeking to demonstrate the government's failings.

What is undesireable is what he have seen Federally over the last year.  Federal Labor's tenuous hold on power has encouraged the Coalition to not cease campaigning after the last election. If there was the real prospect of a recall election, one shudders to think of way that an opposition could contantly seek to stoke the fires of dissatisfaction.

I think that it is better that a party be able to rule "in peace" for a period of time and implement their agenda without worrying that the rug might get pulled out for under them at 60 days notice.

If anything, I would far prefer that the 4 year term be reduced to 3 years.  That would, in my view, make it far more likely that a "bad" government would be turfed out before things got too bad.

It remains to be seen whether the O'Farrell government will take the steps needed to introduce a referendum on recall elections.  It may well be that his failute to release the report before now suggests that he has no intention of doing so.

Accessing the Anger?

Some people will say we shouldn't be surprised. They are a Liberal government, after all.

Could O'Farrell really be planning to fund the North West Rail Link through an "access fee"?

Earlier today the Hills Transport Group put out a press release that quoted RailCorp CEO Rob Mason as saying in a memo that "a private sector entity will design, construct, commission, operate and maintain the North West Rail link... for a period of 20 to 30 years." The press release goes on to explain that this will operate under an "access model".

In plain English, that means that there will be a special station surcharge for travel on the line, similar to the hated Airport Link surcharge.

As a caveat, I should say that there has been no formal announcement or acknowledgment from the government.  O'Farrell may deny any such plans, and it will be anyone's guess whether he has had a quick change of heart or whether Mason was speaking out of turn.

But the plan really does seem crazy.  Ridiculous, unbelievable, hubris-fueled crazy.

The North West is Sydney's biggest growth area.  These people need access to public transport, as the constantly worsening traffic chaos on the major feeder roads attests.

This is why the North West Rail Link is essential if Sydney is to manage its growth.  A government cannot simply keep releasing more and more land to developers and not build heavy rail to get these people around. It should have been built by now, but we can't blame the Coalition for that.

Map of the proposed route.  Taken from the line's website

To be fair, it is true that a privatised line would be cheaper for the government (and, therefore, the people). The government should spend our money carefully, and if there is a cheaper and equally effective way to move people around then it should be investigated.

Equally, I'm a believer in user pays, to a point.  Tolls on roads are appropriate if the tolls are used to fund said roads.  There is no particular reason to encourage people to drive, and anyone who lives in the North West and drives to the city for work knows what they are signing on for.

Rail, however, should be encouraged (and yes, subsidised) by government.  Rail is cheaper, it is better for the environment, it takes up less space, it is clean and it is far more expandable. We cannot just keep jamming more roads and tunnels into our city - we need a good network that grows as the city grows.

While a private model would cost less money up front, under an access model the people who use the line would simply make up the difference.  In other words, the private model would shift the cost away from the rest of the state and towards those people who will actually use the line.

On the surface, that makes sense.  They're getting the benefit, right?  No.

Those people who get the train stay off the roads.  Their polluting cars stay in the garage.  The fuel they would buy stays in the bowser. More bridges, tunnels and parking lots stay on the drawing board. The CBD is that little bit nicer, less crowded, and easier to get in and out of.

Moreover, people suddenly have good reason to live in the North West, knowing that they will have a way to get to work.  The rest of Sydney will have a little less pressure to grow and shoe-horn in even more people.

The rest of Sydney has access to heavily subsidised public transport.  Why do those in the North West deserve any less?

This revelation is particularly surprising in light of the Infrastructure funding models that I wrote about less than a week ago.  In that interview O'Farrell explained quite clearly the value of doing things the "hard way". He was right.  The North West Rail Link needs to be built, and he needs to find some other way of paying for it.

Public transport (and particularly heavy rail) is the skeleton on which a city is built. And, like an animal without a good skeleton, a city without a good skeleton is liable to collapse.

Putting a massive surcharge onto the line to fund it will simply mean far, far less people will use the line.  They will keep driving and paying those tolls because, suddenly, the train trip isn't as economical as it was.  

The North West Rail Link has the potential to be O'Farrell's greatest achievement in government.  It was one of the key promises that got him elected.

If he blows it by making it horrendously expensive to use, I have no doubt he'll not be allowed to forget it.

UPDATE.  The Herald and the Telegraph both have stories about this today.

Additionally, O'Farrell responded on twitter late last night:

A Phelps of an Afternoon

So. My blog last Friday caused a bit of a stir.

Some people were supportive.  Some were abusive (towards me and @Nyx2701) and were promptly unfollowed and/or blocked.

@PeterPhelpsMLC certainly hasn't been turned off twitter.  He also hasn't been banned by O'Farrell, it would seem.

In any event, Phelps and I ended up sparring for a part of this afternoon.  You can make what you like of the conversation - I'm just going to post it below as best I can.  It did shoot off in a few different directions (as conversations on twitter are wont to do) but hopefully it makes sense.

I think my view is clear, as is his.

The conversation started out this story on the Sydney Morning Herald Website.

The story explained that Conroy had been answering questions at the National Press Club on investment in Australia.  It was being broadcast on the ABC at the time. He apparently said the following:

The story wasn't particularly interesting, to me at least.  He accidentally swore, he immediately realised it was inappropriate, apologised and moved on.

The fuss the Herald made about was a little ridiculous, but par for the course in a media culture where it's "all about the clicks".

In any event, @LatikaMBourke tweeted this:

Phelps replied soon after:

My response was this:

From there the conversation kinda just flowed:

For those of you not in the know, my twitter avatar is of Jules Winnfield, a character in the brilliant Tarantino movie Pulp Fiction. Jules has, to say the least, a potty mouth.

A few people chimed in along the way:

Coming back to Peter and me:

Look, no doubt you have your own opinion about this conversation.  Maybe you think I'm being a bit precious.  I don't know.

I guess my point is this.  I'm not "offended" by anything he has said.  What I am is disappointed that someone who has been elected as my representative in this State's Upper House thinks that this is an appropriate way to behave.

Yes, I can unfollow him.  But that's not the point.  Politicians have a responsibility to act like adults and treat voters with respect.

I don't care what Peter is like in private.  I've certainly heard comments about that, but it's not the point.  If you want to get out there and engage with the community (which is a fantastic thing for a politician to do, in my opinion) then you'd better bring your courtesy with you.

If being polite is a little too hard, then we'd all rather you didn't bother.

A True Reflection?

Some politicians really shouldn't get involved in social media.

There are those that use networks like twitter just to broadcast things that are going on, rather than actually interacting with the community. I suppose that is better than nothing, but only just.

Then there are those politicians who don't seem to realise that when you behave on twitter like you behave in private, people notice.  And it matters.

I give you @PeterPhelpsMLC.

Photo from his twitter page

Peter's only been on twitter for a few weeks, but already some of his tweets recently have struck me as a little odd.

We've had comment on the "Libertarian support for unrestricted drug use":

I don't even understand this one:

We've had an intelligent contribution to the Global Warming debate:

There's been a little dating advice for protesters, which was generous of him:

In any event, this morning I saw this tweet and decided to say something:

More than a little disturbed by such juvenile behaviour a Member of the Legislative Council, I tweeted the following:

Subsequently, several people including Penny Sharpe (Labor MLC) have claimed that it is a real account.

A good friend of mine then tweeted the following:

This is what Peter had to say:

I still can't believe someone who has been elected to sit in our Upper House could be stupid enough to send that kind of tweet.

I'll leave the final word to Peter himself.  This was the first tweet he sent:

Peter, clearly it would be better for all of us if you handed your BlackBerry into someone responsible.  You're a disgrace.

UPDATE: I've attempted to bring this blogpost to both Peter and his staff's attention, as well as Barry O'Farrell.  If I receive any comment, I'll be sure to post it here.

UPDATE 2: Jo Tovey just published this piece on SMH

UPDATE 3: Barry O'Farrell just tweeted the following.  It wasn't a response to me as such, but it is pretty clear what it is about.

UPDATE 4: So now this is a thing:

From the SMH front page

Also, this made me laugh...

It appears that this has caused a stir....

An Expensive Ambition

I understand the need to illustrate news stories with photos.  We are visual people, and almost everyone prefers their writing to have some pretty pictures.

There is quite an art to these pictures - the photo needs to go with the story so there is some synergy.  It would jar to have a picture of a happy politician next to a story about how his or her stocks have fallen recently.

Having said all that, the below picture is a fairly ridiculous accompaniment to the story on O'Farrell's repudiation of "commentators" assessment of the value of the "poles and wires":

Photo from the Tele

If this photo was posed, then someone in O'Farrell's office deserves a smack about the head.  He looks ridiculous.

Moving on, the Telegraph has this week continued its campaign for the sale, as is evident from this paragraph:

As it happens, he is right about their being no "magic pudding".  Why he has chosen to describe it as a "magic pudding" rather than a "magic bullet" like any sensible English speaker would is beyond me, but we'll put that aside for the moment.

O'Farrell went on to nominate 4 ways in which the government can raise the money to get stuck into the "infrastructure backlog" left by Labor.

Each of these suggestions merits some further attention.

Realising assets is, politically, an extremely sensitive issue.  I've previously discussed the practical effect, and the unavoidable consequence of union outrage.

Of course the obvious problem is that once assets are sold, they are gone.  If the asset is producing an income, then it is fair to ask whether the state is actually getting value for money.  This is naturally a question that can only be answered by looking at the specific facts and figures for that particular sale.

Federal funding is a vexed issue.  On one hand, O'Farrell's federal counterparts have campaigned heavily against Federal Labor's perceived overspending, so NSW can't complain too much if the belt is pulled a little tighter.  GST flows regardless, but the breakup of the funds is always a difficult issue.

The last time NSW applied for Federal funding the entire matter was botched by Labor's average efforts, so hopefully the Coalition Government will put up a better show.  But it remains a source of funding that cannot be relied on.

Of course, sometimes the Federal government steps in for flagrantly political reasons, such as when NSW Labor promised to build the North-West Rail Link in the lead-up this year's election

Photo from SMH

Growing the state's economy is by far the best option, but also the most difficult.  There are a thousand variables that affect how likely any such effort is to succeed, and those efforts can be derailed by factors far outside the government's control. Additionally, economic growth and the additional tax income it brings also bring with it cost - new residents need public amenities and expenditure on teachers, nurses and the like.

On the other hand, the cash inflow is semi-permanent, it is recurring, and it can be very substantial.

Finally, borrowing within AAA.  The issue of our credit rating has been a recurring issue of late, and the Labor government was roundly criticised not so long ago for its slavish adherence to AAA.

It does make sense to maintain a good credit rating.  The cost saving is significant and it attracts investment.

Like anything else though, someone needs to look at the cost/benefit.  I don't believe that we need to protect the AAA at all costs, and it is entirely conceivable that it may be worth sacrificing AAA to build a particular piece of infrastructure.

At the end of the day, as I have said many times before, O'Farrell said that he wants to be the Infrastructure Premier.  That is a noble goal, and a goal worth pursuing.  But the corollary is that being the Infrastructure Premier is going to take money.  Many, many billions.

It is a very, very difficult promise to keep.

O'Farrell also promised to deliver open government, and multiple departments' now infamous failings in this area have received a great deal of coverage.

That was a promise that cost very little, and merely required a little political will - and yet that has slipped away.

NSW will not allow such laziness when it comes to infrastructure.  It is right and proper that a sensible, measured approach is taken to the projects - we certainly want to avoid another Sydney Metro debacle.

But if a significant number of the promised projects are not moving by the next election (I'm thinking here partcularly of the North West Rail link) then there will be hell to pay at the ballot box.

A two-roled Clover

Clover Moore's dual-role as mayor of Sydney and local member for Sydney in State Parliament has always made me feel a little uneasy.

From what I understand, even the humble back-bencher's job is a gruelling role.  There are local constituents to keep happy, mountains of legislation to keep on top of, and long hours in parliament itself. When you attempt all that as an independent - that is to say, someone who (at least in theory) considers each new bill on its individual merits rather than just following the party line - well, it's no wonder that politicians complain about never seeing their families.

It seems inconceivable that any member of parliament could maintain a 2nd job as well - but that is exactly what Clover Moore has done, and for a long time at that.  She has been the local member for Sydney (previously named Bligh) since 1987 and Lord Mayor of Sydney since 2004 (see her Wikipedia for some interesting background).

Electoral Division of Sydney. Map from the AEC

It's clear that she is not doing it for the money. As mayor she is paid over $110 000 to go with her salary as a Lower House member of just under $140 000, but has consistently donated her entire mayoral salary to inner-city charities.

It seems more likely that she is just a workaholic who has a passion for Sydney and wants to do whatever she can to advance her agenda. Certainly during her tenure as mayor of Sydney she has done a great deal to make Sydney a better place (or, at least, what she thinks would make it a better place).

She is famously skeptical of some new developments but has eagerly championed others, has introduced kilometres of new bike paths, fought for the rights of homosexuals and fought against the sale of dogs and cats in pet shops.

She may soon, however, have to give up one of her roles if legislation mooted by the NSW Government is passed. A discussion paper on the topic can be found here.

The interesting part about the paper is this.  There are a surprisingly large number of members of the legislative assembly who serve on councils:

According to Jo Tovey's article on the discussion paper:

So, whilst the law will apply to everyone equally, Moore is likely to be the only person to have their hand forced by the change.

However, as Tovey correctly notes, the Coalition is very unlikely to win the mayoral race if Moore does step down, so there would not seem to be any direct political advantage in having her step down. That said, a few Liberal donors may well believe that anyone but Moore would be preferable.

The discussion paper is surprisingly readable and easy to understand - it covers in detail the pros and cons of allowing councillors to serve in parliament.  I don't propose to summarise them here, but they bear reading.

For me though, the most important question is this one: is there a conflict of interest?

What that paragraph says, in short, is that the dual roles are not a conflict of interest - rather it is just that it can be perceived as such. Whilst perceptions are important, and if people are going to perceive a conflict of interest then it is a matter of concern, my personal view is that the risk is low enough to be of fairly minor concern.

The most important pro this this one:

Clover Moore (and every other dual-role member) was elected through a popular election.  She broke no laws, and her opponents no doubt had plenty to say about the fact that she was going to be serving two roles.

Clearly the voting public is very unconcerned by any perceived conflict of interest or the workload.  This wasn't something that was secret like a bribe or a promise of quid pro quo - everyone knew, and, presumably, almost no one cared.

In those circumstances, where there is no actual conflict of interest, what business does the government have stepping in and making laws about who should be able to serve in these dual-roles?

Hopefully the discussion paper will receive a wide range of responses.  I'll certainly put in a response and post is here if I remember.

A Position of Power

Privitisation is, in many ways, one of the defining differences between the left and the right.

The right believes that governments are bad at running businesses, and wherever possible business should be left up to business.

The left believe that business are pretty good at screwing everyone possible if it means an extra dollar or two.

To some extent at least, both are right.

That's not meant to be a shameless attempt at fence sitting - my view that governments are pretty bad at running businesses.  Almost invariably a business run by government will be less efficient, often because of higher wage costs.

Privitisation almost always leads to lower wage bills, usually through a reduction in pay and conditions but often also because of redundancies. A service provided a business will therefore often be a lower quality service. It's little wonder that unions oppose privitisation almost as a reflex.

There is a middle ground somewhere - privitisation is not always right any more than it is always wrong.

The best known example of privitisation in Australia is Telstra.  The Howard government made a packet out of the sale (although not as much as they should have) that was spent on (mostly) tax cuts. It's not really fair to compare service in telecommunications over different decades, but the prevailing view is that the service provided by Telstra today is of a far lower quality than when it was a government asset.

Photo from the ABC

That actually provides a pretty neat seque to the discussion about electricity privitisation debate in NSW, for this reason: the Howard government sold not only the retailer but also the infrastructure - the phone lines themselves.

These days Telstra rents that same network to the other telecommunication companies, and is undoubtedly a more valuable company than it would be without that asset.  But the kerfuffle about the NBN shows, in part, the dangers of selling off infrastructure like a telephone network.

Before the last election Labor practically tore itself apart deciding what to do with the electricity network.  In the end, thanks to the Coalition opposing the deal, Labor was not able to secure the sale.  Iemma's quote summed up the situation quite neatly:  "The leader of the Opposition [O'Farrell] knows that the Government's approach is right. Yet for five minutes of political advantage he has displayed all the principles of an economic vandal."

Following from Iemma's demise, the Labor Party's position seemed firmly anti-privitisation.  In fact, O'Farrell's refusal to rule out privitisation was the reason for a particularly unpleasant ad leading up to the election:



O'Farrell repeatedly said that they would wait for the Tamberlin report, which I have written about here.

The GenTrader deal never really made any sense, and in my view it is sensible in principle for the retailers to be sold.  Of course the price that can be obtained is a different story entirely, and that will be a question of fact at the appropriate time.

No doubt, however, we'll be plagued by a thousand different calculations of the "true value" of the asset and the actual realised amount, such that it will be almost impossible to perceive, through the fog of partisanship, whether the government has actually secured a good deal.

The controversial and interesting aspect of the Coalition cabinet's decision, however, is the fact that the decision has been made to keep the "poles and wires" in public hands.

This has important implications because the value of the sale is drastically reduced as a result. The poles and wires are far and away most the valuable part of the network, and selling the full network would result in a massive windfall for the government.

Nick Greiner has come out and said that the government has "absolutely, totally no alternative" to flogging the poles and wires if it wants to "move the needle" on infrastructure.

In fact, the Daily Terror had this on its front page earlier this week:

From this story

The Terror has also published this editorial that calls O'Farrell a "fencesitter".

The graphic abour really explains the Terror's point of view quite neatly - the assets should be sold so that the money can be spent. O'Farrell has made a lot of expensive promises, and we all know that the money has to come from somewhere.

The current political landscape makes it difficult for O'Farrell to borrow large amounts (although it would be interesting to see if the Terror pursued him for borrowing in the same way it has pursued the Federal Government).  Further, no one needs to think hard to remember what a sparkling success public-private partnershipshave been in this state.

It is not unreasonable to suggest that the poles and wires should be sold so that the money can be spent elsewhere.  The discussion then becomes opportunity cost - what is the better use of the government's money?

That is the nub of the discussion - by not selling the poles and wires the government is retaining its $20 billion odd investment in the power network.  If sold, the retailers would need to pay for access.  They will of course need to pay no matter who owns the wires, but at present the cash flows straight to the government.

John Robertson is claiming that power prices will rise as a result, and he is probably right.  Services provided by government usually increase in price and decrease in quality once sold.

But the Terror has hit on O'Farrell's problem - he has to find the money to pay for his promises.  If he wants to avoid borrowing (and presumably he does) then he needs to start selling things. Presumably this is why Mike Baird, Gladys Berejiklian, Greg Pearce, Pru Goward and Andrew Constance all argued for the full sale.

I hope for his sake that at that cabinet meeting he explained where he is going to find this money.  If he is going to be the Infrastructure Premier we all know he wants to be, he will need cash.