Tuesday, 28 January 2014

Labor must use opposition days to reform itself

The political parties are inextricably bound together, whether they like it or not. The Labor Party is intent on stopping the Coalition from cleaning up the mess it left. Labor is doing its best to undermine the effort to stop the boats, discredit the Commission of Audit, oppose expenditure cuts and still support the carbon tax.

Labor will have some impact on what Prime Minister Tony Abbott can do and that will be no help to anyone, itself included.

Abbott will most likely win the 2016 election, so Labor has time time to dump policies that will be a problem for it later. Australia could easily be facing a flat economic performance for some years ahead. Per capita income in many households may remain stagnant. If Labor maintains its current approach, it will be harder to secure the reforms the country needs.

Australia needs a better opposition than what we have today. Labor's tactics will not only make it harder for the government to fix the problems but it will undermine its own electoral prospects. Like it or not, both sides of politics need to be doing their best in this Parliament.

Labor has enough good operators in Parliament and outside to be a better opposition. It should be more ambitious and pick up the Keating legacy left dormant since Kim Beazley's departure. People like Chris Bowen, Jason Clare, Paul Howes and Richard Marles should push for reform.

For starters, Labor should forget the carbon tax; it has lost that one. Second, Labor needs to support expenditure restraint to show it realises the scale of waste under Kevin Rudd and Julia Gillard was not acceptable.

After Labor went into opposition in the 1990s, Gareth Evans announced his intention to quit parliament. He thought opposition was a complete waste of time and he did not want to suffer ''relevance deprivation syndrome''. He held the ''winner takes all'' view. Opposition is not a waste of time; it is an essential time to regroup and reframe policy and the public debate. Labor has got it all wrong if it thinks it will return to office by mimicking Abbott.

The interaction between the parties was on display during John Hewson's 1993 Fightback election. Paul Keating promised to match John Hewson's income tax cuts. But unlike Keating's, Hewson's cuts were funded by the GST. Keating was forced to dump his cuts after the election and that broken promise became one reason he lost in 1996.

Labor's tactics now should be more like the Coalition's role in the 1980s, when the Coalition supported Hawke and Keating's reforms. That support did not disadvantage the Coalition's electoral prospects - they were shredded by disunity, not by supporting privatisation, floating the dollar or other reforms.

In the 1980s and early 1990s reformists were in the ascendancy and we need them back now.

You don't need a lot of reformers in government to make a difference; there were not many in the Howard government. Keating had only a few parliamentary reformists to back him but, to his credit, he fully utilised advice from reformers within Treasury and the Reserve Bank.

There are lots of things Labor could do to help the country and itself . It is time to reconsider the relationship with the unions and at the same time introduce wide-ranging party reform. Labor might be able to remain a political force without reform for many years, but eventually it won't be politically viable while the unions effectively run the party with only 13 per cent representation from the private sector workforce.

The Greens are another problem for Labor. They are too far to the left and irresponsible on economic policy. Greens policy on issues like boat people is out of step with public opinion. Labor should dump the Greens; they have nowhere else to go, so why should Labor let them cling on when the Greens want to displace it anyway.

Labor should immediately establish its own internal expenditure review committee. This was done under Hewson and when Labor's budget came out, the Coalition listed further cuts. Labor could start with business welfare. Government waste will not be eradicated under the Coalition.

I have no doubt the Commission of Audit will be an ''OMG'' moment for Abbott. And the bigger the cuts, the more Labor will be salivating at the thought of widespread pain.

But Labor needs to think strategically about its future. Some will say big reform is neither desirable nor possible. But it can be done, as shown by Tony Blair and New Labour in Britain. Nothing could be worse for Australia than if Labor thwarts Coalition reform and then in time returns to office no more capable to govern than under Rudd and Gillard.

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