Why we need community focused microeconomic reform

Hawke Keating.jpg

Watching the recent Bob Hawke documentary provides a reminder that at one point in Australia’s political history micro-economic reform dominated the national debate.

During the 1990 Federal Election campaign Bob Hawke delivered a speech on micro-economic reform, apologising in advance as he outlined technical details.

In a speech that focused on the intricacies of competition and reforms to shipping and aviation, Hawke closed by stating “Institutions and attitudes can’t be changed overnight.  Results can never be immediate. Public debate will be dominated by the vocal complaints of the minority who are adversely affected, rather than by the vast majority of consumers and taxpayers who are incrementally advantaged. This underlines the need for creative thought, proper consultation and a willingness to ease the burdens on those facing change. It also shows that, at times, a Government needs to stand firm against those groups who, for short-term or selfish reasons, threaten to upset the gains that can be made by the community as a whole”.

One of the problems that we have with the national discourse on infrastructure is an assumption that the electorate can only digest, and support, large infrastructure projects. Hence the focus on multi- billion investments for in-land rail and Snowy Hydro.

The debate on microeconomic reform almost thirty years ago had a wider narrative. Microeconomic reform was, according to Bob Hawke about creating “a modern, growing economy, shaken out of the old complacent dependence on commodity exports, re-equipped and restructured in its attitudes, institutions and technology, to be fully competitive in the world”.

Narrative is important for change. The electorate may not have followed all the details of reforms to aviation and shipping but accepted the broader reason why it was important to focus on these areas.

The challenge for communities is that we have yet to create a narrative on why investment is important to the national economy and society.

We need to tell the story about what is actually happening in the community.

As an example, take recent conflicts in Melbourne over sporting facilities.

  • A bowls club resorts to national media as the council plans to move the club to an unspecified alternative to make way for basketball
  • With netball demand outstripping court availability, a local netball league argues that more courts should be built on the neighbouring athletics track. The athletics association is not impressed.
  • A golf driving range is proposed to make way for netball expansion.

The story in established city suburbs is one scarcity and competition. Meanwhile in the regions the story is a lack of capital.

  • A multi premiership winning football side in a Victorian country town operates with the most basic of facilities.
  • Swimming pools in the regions need significant investments just to keep them to operational standard.

Even when Governments do provide funding it may not be directed at needs.

Take the club that received a $100,000 commercial kitchen when it would have been happy with something for one-twentieth of the cost.

Or the multi- million investment to build new life saving facilities in a marginal seat, when the lifesaving club up the road is unable to get access to capital.

What is going wrong?

As a nation we need to understand the important role that investment in communities can play in unlocking social well- being and economic opportunities. Just as with the debate on microeconomic reform thirty years ago, we need to create a narrative on why we need a different approach to community investment.

The alternative is that conflicts and scarcity of capital will become entrenched.

Hawke’s 1990 Speech: http://pmtranscripts.pmc.gov.au/release/transcript-7919

Originally published LinkedIn February 26, 2018

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