Inside Story

Rolling out the barrel

Electoral bribery is expensive, wasteful and probably ineffective. And why is Canberra funding car parks anyway?

Ian McAuley 16 July 2021 2199 words

Why does the federal government get involved in schemes better left to the states? Evgeny Zhigalov/iStockphoto

Transparency International ranks Australia at eleventh position on its corruption perception index — behind New Zealand, Singapore and most northern European countries, but well ahead of countries where governments treat public finances as slush funds for the ruling parties. Corruption is something that happens in other countries.

That image is rather tarnished by this month’s Australian National Audit Office report on commuter car parks. Simon Longstaff, of The Ethics Centre, described what had been unearthed in plain language: “Let’s not beat around the bush here. The use of public money (or power) for private political purposes is corrupt.”

This Audit Office report has echoes of its probe into the sports rorts affair, released early last year. Both are about ministerial interference in a grants program which overrode benefit–cost criteria and favoured the Coalition’s electoral interests, and both reveal a lack of transparency in the government’s decision-making process. There are some important differences, however.

First, the car park grants are on a much bigger scale. Only $103 million of funding was announced in the Community Sport Infrastructure Grant Program, while so far $660 million has been committed under commuter car park projects within the Urban Congestion Fund.

Second, while the sports projects were mainly in rural electorates, the commuter car park spending is directed at park-and-ride projects in capital cities. The former was a Nationals boondoggle; this one was a Liberal Party boondoggle.

Third, in terms of corruption of process, the car park program seems to have hit a new low. The Audit Office didn’t find even the fig leaf of an open competitive process: “Funding was allocated using a non-competitive, non-application based process.”

Fourth is the strength of language in the report. Journalists, academics and public servants who habitually read Audit Office reports were surprised by its assertiveness — “the most scathing audit report we’ve ever read,” according to veteran public service watcher Verona Burgess. The Audit Office is rarely as explicit about electoral calculations as it has been in this report: its maps of project locations superimposed on red and blue shaded Electoral Commission maps look as if they have been taken from the wall of the transport minister’s office.

The fifth, and perhaps most important, difference lies in the way the Morrison government has reacted to the two reports. The sports rorts did at least see some embarrassment expressed, and perhaps even a little shame — certainly enough to see sports minister Bridget McKenzie scapegoated and sent to the backbench, in spite of the clear involvement of the prime minister’s office.

This time the government has used a different approach: it’s all okay; it’s what every government does. When Insiders host David Speers asked finance minister Simon Birmingham about the car park funding report (“pork and ride,” to use Anthony Albanese’s term), Birmingham responded, “The Australian people had their chance and voted the government back in at the last election.” He also gave every indication that the Morrison government will do the same at the next election. End of story.

It’s this last aspect — the attempt to normalise such behaviour — that has been most shocking for Longstaff and others who assumed that even if the Morrison government lacks moral principles to guide how it uses public money, it might at least be constrained by a sense of shame.

At one level, Birmingham’s rationalisation is simply a statement of Politics 101. Public servants may rank projects on benefit–cost criteria, but the responsibility for allocating public money lies with the government, and if the public don’t like it they can throw the government out of office.

It’s a superficially appealing argument based on the assumption that voters are well informed. Sometimes they may well be, and sometimes governments explain why they are departing from considered advice. On release of reports from royal commissions or the Productivity Commission, for instance, the government generally states which recommendations it accepts and which it rejects, and provides reasons. But the harder it is to justify departures from advice, the more likely it is that the government will shroud its decisions in secrecy. It’s hard to imagine Morrison having said to Melbourne voters, in the pre-election period, “Public officials have assessed a need for commuter car parks in Melbourne’s western suburbs, but we have decided to provide them in the more prosperous southeast, where our loyal mates live. They have expensive European cars that need the protection of secure undercover parking.”

In terms of accountability, it’s generally better if governments exercise their discretion not at the final stage of project assessment but at the stage where programs are designed, specifying clear guidelines in line with their political values. It’s not a rort-proof process: ministerial advisers armed with electoral maps are adept at writing guidelines that happen to align with their bosses’ interests, but at least it protects the government from accusations of pork-barrelling and conveys an impression of clean administration to the outside world.

In this case the Morrison government hasn’t even been that clever. It has simply treated discretionary funding as a slush fund to advance its own electoral interests, and Birmingham has effectively admitted as much. Evidence of such behaviour should be enough to bring a charge of corruption in a properly constituted system of governance, but as Yee-Fui Ng, deputy director of the Australian Centre for Justice Innovation at Monash University, points out, it would take a well-resourced and independent commission against corruption to pursue a legal case of that kind. The Audit Office’s role is that of an auditor, not a prosecutor.

Nor does the Audit Office have a brief to report on government policy. Understandably, the media has had a feast going through the misdeeds uncovered in the report — there are plenty to fill journalists’ columns.

That leaves a policy question so far unanswered, in both the sports and car park programs. Why should the Commonwealth be involved in such programs in the first place?

Australia is a federation, and while section 51 of the Constitution — the part that specifies Commonwealth powers — says nothing about sporting club change rooms or car parks, commonsense administrative reasons indicate that the Commonwealth shouldn’t have been involved in either of these programs. It’s understandable that the federal government may

have a general interest in sport because of its health benefits, and the politicisation of international sporting events means it has been dragged into a role in elite sports. But grandstands and change rooms in country towns? Surely state and local governments are better able to allocate funds to such projects.

Similarly with transport: the Commonwealth should be involved in international ports and airports, national highways and railways, and setting standards. But commuter car parks? These surely should be matters for state government transport departments to work out in coordination with their public transport authorities.

It’s not only a question of local knowledge; it’s also about the Commonwealth’s loss of administrative capacities over the years as it has privatised and corporatised government functions. Anyone who needs convincing on this point should consider the current vaccination program or, to use an example from a Labor government, the Rudd–Gillard government’s home insulation program. The latter certainly had political costs for the government of the day, and the former seems to be doing considerable political damage to the Morrison government.

Even on a political level, though, why does the federal government get involved in schemes better left to the states? Surely it would be better to hand over the money and let the Grants Commission process do the rest. Or if it particularly wants to help country sportspeople, or urban commuters, it can hand over funds to the states as tied grants, with carefully specified criteria. Then the state governments can bear the political costs of delayed projects — the forty-two car park sites where no work has commenced out of the forty-seven approved, or the fact that members of the Betoota Bowls Club are still changing into their whites in their cars. And does not the Coalition have a tradition of “states’ rights”?

Those who ask such questions may be accused of naivety. Turning again to Politics 101, it is virtually axiomatic that no government wants to give up fiscal powers, particularly when it can use them to electoral advantage. Political analysts may assume that a government facing a tight contest, as the Morrison government was in 2019, would do a careful calculation and distribute discretionary funding to its immediate advantage — to its own seats held on a slim margin if it fears losing the election, or to opposition seats held on a slim margin if it hopes to consolidate its majority.

The Poll Bludger’s William Bowe examined this possibility in relation to the sports grants by looking at booth-by-booth swings in 2088 local regions. He found “no correlation whatsoever between the amount of funding they received and how much they swung to or against the Coalition.” Some allocations were made to seats so safely held that no amount of pork was likely to move them, and some of those projects may have been justified on benefit–cost grounds. (The Audit Office concluded that some were worthwhile but didn’t provide detail about specific allocations.) While the Audit Office found that funding allocations did not align with criteria of need, Bowe found that neither did they align with criteria of politically optimising the allocation of pork.

No similar analysis has been done on the car park program, but it’s hard to see how it might have had much effect on the 2019 election. Southeast Melbourne is fairly solid Liberal Party territory, for example, and only one of the Liberal Party’s seats (Deakin, then held by Michael Sukkar on a 3.2 per cent margin) in that region looked vulnerable. In any event it’s hard to see how promising a commuter car park would give a government a meaningful political dividend. It’s a benefit targeted at quite a small subset of the electorate — CBD commuters who own a car, don’t need it during the day, realise that the Commonwealth has committed to build a car park at their train station, and would find its provision a deciding factor in how they vote in a federal election.

One reason why pork-barrelling may not yield political benefits in Australia is that the Senate is elected on a statewide basis. The electoral mathematics of marginal seats doesn’t hold for the Senate, and it’s a useful outlet for a revenge vote by someone who has felt the negative side of pork-barrelling.

Bowe’s findings tend to confirm academic research on discretionary election spending. It’s hard to discern any impact of pork-barrelling on electoral swings. But there is some suggestion that discretionary spending is treated as a reward to loyal constituents, possibly explaining high levels of expenditure in safe seats. We can imagine, perhaps, that politicians with prominent profiles in their electorates, as may be the case for some National Party members, might seek to present themselves as the big men or women who can deliver for their tribe — a strategy directed more at holding on to preselection than securing a seat for the party.

Or maybe it’s futile to trawl through the data looking for any logic to pork-barrelling, and particularly by governments of the right, who tend to see public spending as a necessary evil to keep on side a greedy electorate who unreasonably want things like schools, hospitals, roads, police and other public services.

Built into the Liberal Party’s statement of core beliefs is the notion that nothing of value is achieved through public expenditure. If it’s all wasteful, then techniques such as benefit–cost analysis can be ignored as meaningless because there are no benefits. Ministerial or prime ministerial choice may as well prevail, and maybe these projects can provide photo-ops or support for a local candidate.

And just as those same ministers disregard the advice of economic experts in their departments, they probably disregard the political advice of polling experts on their staff. It’s the style of a salesperson who really doesn’t have much faith in the quality of the product. In that context Birmingham’s rationalisation makes perfect sense.

The ineffectiveness of pork-barrelling may provide some comfort when we observe the way the Morrison government has treated discretionary appropriations as extensions of the Coalition’s electoral war chest. But the opportunity cost of such misappropriation is high — the car parks that never get built in areas where they would have provided more public value; the wasted efforts by country sporting bodies in preparing well-considered submissions for grants. More significant, but harder to quantify, is the cost of cynicism as people see the contempt with which governments spend voters’ hard-earned taxes. It’s a cynicism that, if sustained, can lead all the way to a failed state.

As Simon Longstaff said, the car park grants “rot the body politic.” To stop the rot we need an independent anti-corruption commission, not just to arrest a slide down the Transparency International index but also to help restore good government. •