The elephant in the room: India’s infamous bureaucracy.I’m starting to suspect the federal government – of whatever colour – has lost its ability to control its own spending.
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Even if this is, as yet, only partly true, governments are likely to have unending trouble returning the recurrent budget to balance and keeping it there, let alone getting it into surplus so as to pay down debt.

Those of us who worry about such things have given too little thought to the causes of the Abbott-Turnbull government’s abject failure to achieve its oft-stated goal of repairing the budget solely by cutting government spending.

It’s common to blame this on political failure and obstacles. There’s truth in most of those excuses, but they miss the point. Spending restraint will never be easy politically, governments rarely have the number in the Senate and their opponents will always be opportunistic.

That’s why governments need to be a lot clearer about what they’re seeking to achieve on the spending side, and a lot more strategic in how they try to bring it about.

On ultimate objectives, the goal of literally smaller government – smaller than it is today – is a pipedream. Government spending is almost certain to rise over time – don’t you read Treasury’s intergenerational reports? – meaning taxes will have to rise over time.

But there are obvious limits to voters’ appetite for higher taxes, which is why governments need to be able to control the rate at which their spending is growing, and do it not by cost-shifting to other governments or service recipients – as was the approach in the failed 2014 budget – but by ensuring ever-improving value for money through greater efficiency and effectiveness.

Unless governments lose their obsession with welfare spending (most of which goes to the aged) and come to terms with the other two really big items of government spending, health and education – especially when you consolidate federal and state budgets – they won’t get far with controlling the rate of growth in their spending.

What too few people realise is how much of government spending goes not directly into the pockets of voting punters, but indirectly via businesses big and small: medical specialists, chemists, drug companies, private health funds, private schools, universities fixated by their ranking on global league tables, businesses chasing every subsidy they can get, not to mention international arms suppliers.

The budget, in other words, is positively crawling with vested interests lobbying to protect and increase their cut of taxpayers’ money.

A government that can’t control all this potential business rent-seeking – isn’t perpetually demanding better value for taxpayers; perpetually testing for effectiveness – is unlikely to have much success in limiting the growth in its spending.

Which brings me to my fear that government has already lost that ability.

A wrong turn taken early in the term of the Howard government – when the Finance department moved most responsibility for spending control to individual departments and got rid of most of its own experts on particular spending areas – plus many years of “efficiency dividends” (these days a euphemism for annual redundancy rounds) have hollowed out the public service.

The spending departments have lost much of their ability to advise on policy, while the “co-ordinating departments” – Treasury, Finance and Prime Minister’s – have lost much of their understanding of the specifics of major spending programs.

This matters not just because the departments have become increasingly dependent on outside consultants to tell them how to do their job – and to be the for-profit repositories of what was formerly government expertise – which could easily be more expensive than paying your own people.

The big four chartered accounting firms were paid $1 billion in consulting fees over the past three years, thus introducing a whole new stratum of potential rent-seeking.

More importantly, the longstanding practice of having specialised departments – one each for the farmers, miners, manufacturers, greenies etc – makes them hugely susceptible to being “captured” by the industry they’re supposed to be regulating in the public interest.

The departments soon realise their job is to keep the miners or whoever happy and not making trouble for the government.

The Health department, for instance, would see its primary task as dividing the taxpayers’ lolly between the doctors, the chemists, the drug companies and the health funds in a way that keeps political friction to a minimum.

How much incentive do you reckon this gives the spending departments to limit their spending, root out rent-seeking and lift effectiveness?

That’s why, by denuding the co-ordinating departments of people who know where the bodies are buried in department X, government has lost a key competency: the ability to control the growth in its own spending.

Ross Gittins is the Herald’s economics editor. Twitter: @1RossGittins


Peter Sterling wants to stay on as advisor to the NSW State of Origin coach but concedes it will be up to Laurie Daley’s successor to determine whether he retains a place in the Blues’ set-up.
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The former Parramatta and NSW halfback was interviewed by the NSWRL board as part of its series review on Friday, the same day Daley was told he would not be offered a new contract after five years at the helm.

Brought on this year to replace Bob Fulton as the coach’s right-hand man, Sterling told directors he was keen to continue but made it clear on Monday he did not endorse Daley’s sacking.

“I’ve spoken to Laurie and he’s particularly disappointed,” Sterling told Channel 9.

“I know that he thought there was unfinished business to still take care of. I said during the course of that Origin campaign that win, lose or draw I thought Laurie was still the best man for the job. Nothing that I saw changed that or has changed that.”

Sterling acted as a sounding board for Daley in the lead-up to and during the Origin series, which was clinched emphatically by Queensland in game three in Brisbane.

Brad Fittler is considered the front runner to replace Daley and while the NSWRL has committed to an organisational overhaul of the Blues backroom structure, it may well be up to the new coach to determine who he wants alongside him in camp.

“[The board] asked me would I be keen to be involved in the future. I said that was the case, yes, but if I’m the new coach coming in the proviso for me is that I bring people that I want. So that’s a decision to be made by other people,” Sterling said.

“I loved every second of my involvement with Origin this year. The only thing I didn’t enjoy was the result.”

Daley was axed amid claims about a Blues drinking culture, which reared its head when it was revealed that Josh Dugan and Blake Ferguson had spent an afternoon at a Lennox Head pub five days before the deciding match. Bar bills run up by Blues staff during the series were also raised during the board’s review.

“There has been a lot made obviously of two players going down and spending an afternoon on a day off around alcohol,” Sterling said. “I can’t be too critical of that because I don’t know the degree of alcohol that was drunk on that particular day. It’s how I would have spent my day off … going down and sitting and having a bit of a flutter and getting away from Origin camp.”


I GET that indigenous ns are offended by Day and statues representing Captain Cook et al, but we can’t move forward if people are focused on the past and keep looking back in anger. We are not to blame for what our ancestors did, just like we can’t blame modern Germany or Cambodia for Hitler and Pol Pot. Please let’s just all move forward in peace as one nation.
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Debra Forbes,WickhamI SINCERELYhope the lecturer and students recover fully from the horrific attack at ANU (“Students praised for actions in bat attack”, Herald 26/8). But I have to say the two years I spent studying statistics for my accountancy degree never incited violence, just total soporific boredom. I’m still coming to terms as to why a statistics course would cause someone to behave in this manner. I can only assume his J curve fell below the accepted median.

Ann Ellis,MerewetherLAW is law. If I for any reason misinformedmyemployer on any grounds on my application it could lead to instant dismissal. But we are talking of constitution, of national security, of this Commonwealth. How do a few peoplechange Commonwealth constitution? Sir John Kerr had to get the head ofstateto sack a Prime Minister. as a whole, in my eyes, is open. I feel for the generations to come.

Michael Casey,MerewetherIF our politicians are required to be n citizens,and rightly so, how come our head of state is a foreigner who lives thousands of miles away and visits once every blue moon? Should there not be a requirement of our head of state to be n?

Michael Maher,EleebanaWith all due respect Tom Edwards (Short Takes 26/8): n marriage laws are made by the Parliament. The last time they were changed was by John Howard and the Parliament at the time. The current debate will still have to be resolved by Parliament regardless what the postal survey reveals . I hope you vote yes the next time this government can’t make a decision.

Andrew Whitbread-Brown, Cardiff HeightsLesField’s letter regarding The Store building was published under the heading “It’sa tragedy, but it’s over” (Letters 24/8). This also applies to the former post office. After years of neglect by former and currentowners is it salvageable?

Lynne Jones,IslingtonThe mayor of Newcastle wants to stop having photos taken with whoever visits and do something about all the rubbish that accumulates at the public bus stops near the University of Newcastle . It is a bloody shame we have to sit in such filth while waiting for a bus that might come.

Kathleen Whyte,Waratah WestTHE POLLSAre ticket resale sites a problem?

Yes, 98.3%, No, 1.7%Should councils weigh in on the same-sex marriage debate?

Yes, 26.7%, No, 73.3%


The universities that are the hardest to get into may not be delivering the best experience or employment outcomes for their students, new research shows.
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Students at the University of NSW, Sydney University, the University of Melbourne and the University of Western have some of the highest entrance scores in , according to this year’s Good Universities Guide.

However, none of these universities are in the guide’s top 10 for staff qualifications or overall experience, which measures engagement, resources, skills development, support and teaching quality.

All four scored below the national average for overall experience and nationally, UNSW, Sydney and UWA ranked among the bottom seven in this category.

The guide, which is compiled annually, ranked Bond University at number one for overall experience, followed by Notre Dame and Edith Cowan University.

Among NSW universities, the University of New England was ranked at number seven, followed by the University of Wollongong, n Catholic University and the University of Newcastle.

Only UNSW was ranked in the top 10 for full-time employment outcomes with 76.4 per cent of its students finding jobs within four months of graduating.

Some 70.4 per cent of Sydney graduates find full-time employment within four months. This falls to about 65 per cent at UWA and 63.6 per cent at Melbourne University.

In comparison, about 84 per cent of students at the best university for employment outcomes, Charles Sturt University, find full-time work within four months of leaving. About 55 per cent of students at Flinders University, ranked lowest in this area, find full-time jobs within four months.

The four universities are also falling behind in students’ starting salaries, with only UWA ranked in the top 10 for median graduate incomes. Its graduates earn about $60,900 after leaving university, while UNSW graduates earn $60,000, Sydney University graduates earn $56,000 and University of Melbourne students earn about $53,500.

Chris Lester, chief executive of the Good Universities Group, which compiles the guide, said the most in-demand universities are lagging in these areas partly because of the high proportion of their students who are school leavers, rather than mature-age students.

“Now, people [coming to university] straight out of school are finding it difficult to get a job,” Mr Lester said.

He said starting salaries are also linked to the proportion of mature-age students as well as “the mix of courses that universities are offering and the mix of students they have”.

However, Mr Lester said that a number of the universities delivering the best graduate outcomes also offer specific programs and internships “that are definitely helping students get jobs when they finish”.

“The University of Wollongong is one of the big standouts in the way they’ve moved, and some of the things they say they’re doing is trying to make sure that someone’s not just a number, and having differentiated programs for different students,” Mr Lester said.

Mr Lester said that universities’ high entry scores and high demand are at least partially linked to reputation rather than quality.

“Parents have a big part to play in relation to where students go and when they came out of university 20 or 30 years ago, [things] were very different,” Mr Lester said.

“Parents need to be very mindful of the changing landscape. Younger universities are trying different things now.”

The University of Sydney and UNSW were contacted for comment.


Yes, Houston, you do have a problem, and – as insensitive as it seems to bring it up just now – some of it is your own making.
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Let’s be clear upfront. I unreservedly wish that all of your millions of citizens get safely through Tropical Storm Harvey, and the biblical-scale deluge and floods that are forecast to swamp your city in coming days.

But, as the self-styled “world capital of the oil and gas industry”, there’s a connection between rising global greenhouse gas levels and the extreme weather now being inflicted that some of your residents have understood for decades and had a hand in.

Houston and its surrounds are home to some 5000 energy-related firms, 17 of which are counted among the Fortune 500 list of largest US companies.

The nearby Gulf Coast is also one of the biggest oil-refining centres anywhere. Not for nothing, the local football team was named the Houston Oilers before it up-rigged elsewhere to become the Tennessee Titans.

One thing that hasn’t changed for almost 200 years is scientists’ basic understanding humans could alter the chemistry of the atmosphere. By releasing more carbon dioxide, methane (also known as natural gas), and other greenhouse gases, the atmosphere would trap more heat and alter our climate in the process.

The links between fossil fuels and climate change – clear to all but a handful of (often industry-funded) scientists – were hardly promotional talking points oil firms have been keen to trumpet.

In fact, as an important research paper by Harvard University researchers Geoffrey Supran and Naomi Oreskes released last week showed, the largest of them – ExxonMobil – deliberately told the public a story at odds with their own research.

By stoking doubts about the climate change consequences of burning fossils, the behemoth misled voters for four decades, successfully stymieing demands for action in the US and abroad, including in .

Although ExxonMobil is headquartered in another Texan city, Dallas, it bases many operations in Houston. The company has picked Houston to host a sprawling new campus north of the city that will reportedly house 8000 employees. So far, two-day rainfall in Houston has nearly doubled the previous all-time record.It even beat the previous *26-day* record. Wow. https://t苏州夜生活/GLxuttsCyp??? Eric Holthaus (@EricHolthaus) August 28, 2017Unbelievable Before & After of the flooding on Buffalo Bayou in #Houston from #Harvey. (Via streetreporter on Youtube) pic.twitter苏州夜网/a6FXIh0rtq??? Matt Reagan (@ReaganMatt) August 27, 2017Harvey update, 10pm CDT:NHC reiterates 50″ storm-total rainfall fcst for parts of Texas including Houston, center to move back over Gulf. pic.twitter苏州夜网/W4ysIbwbbg??? Eric Holthaus (@EricHolthaus) August 28, 2017This event is unprecedented & all impacts are unknown & beyond anything experienced. Follow orders from officials to ensure safety. #Harveypic.twitter苏州夜网/IjpWLey1h8??? NWS (@NWS) August 27, 2017