Appendix H

Theories of Public Policy

In studying the reasons for changes in government policy objectives, an important element of the analysis is to investigate a number of theories of the policy-making process. The political science and public policy literature since the 1950s is a rich source of theory building that can be used for the purposes of the thesis. The central concern of the thesis has been about why policy change occurs.

The canvassing of various policy models is important because it is possible that the nature of the regional policy process itself has played a part in the decline of balanced development as a policy objective (see Chapter Nine). Moreover, the models that attempt to explain the policy process may shed light on the changing nature of the policy environment. As Hawker et al argue, " ... the study of policy processes will reveal how institutions work to shape and direct ideas and political pressures. Public policies do not spring fully formed from environmental conditions, however important these may be" (Hawker et al 1979: 9).

But first, what do we mean by "policy"? According to Heclo, there are eight definitions of policy. Heclo states that policy is "... usually considered to apply to something bigger than particular decisions, but smaller than general social movements" (Hawker et al 1979: 7). According to Hawker et al "... public policy consists of continuing patterns of political and administrative activity that are shaped both by deliberate decisions and by the interplay of political and environmental forces" (Hawker et al 1979: 22).

Davis et al state that public policy is a "... process in which values, interests and resources compete through institutions to influence government action" (Davis et al 1993: 7). Elsewhere, they describe public policy as "... the interaction of values, interests and resources, guided through institutions and mediated by politics" (Davis et al 1993: 15). Lasswell saw policy making as involving "... five intellectual tasks [which] are performed at varying levels of insight and understanding: clarification of goals; description of trends; analysis of conditions; projection of future developments; and invention, evaluation and selection of alternatives" (quoted in Hawker et al 1979: 277-78). According to Hawker et al, factors that affect the shape of public policy include:

• Social and economic conditions; • Prevailing ideas; • Institutions and individuals; • Technical and analytical procedures; and • General theories of how policy is made.

They conclude that the policy process is uncertain, complex, fragmented and subject to diverse influences (Hawker et al 1979: 23). Elsewhere, they claim it is characterised by fragmentation and muddle, not by rationality and sequence (Hawker

443 et al 1979: 285). Thomas Dye, who has written extensively on public policy processes, has developed nine policy models:

• Institutional – policy as institutional output; • Process – policy as political activity; • Group – policy as group equilibrium; • Elite – policy as elite preference; • Rational – policy as maximum social gain; • Incremental – policy as variation on the past; • Game theory – policy as rational choice in competitive situations; • Public choice – policy as collective decision-making by self-interested individuals; and • Systems – policy as system output (Dye 1992: 20).

Other writers use similar schemata to describe the policy process. The two basic models most often compared and contrasted are the "rational comprehensive" model and the incremental model. Further, distinctions are drawn (eg Murray Frazer 1986) between the rational approach which seeks the best solution to policy problems and a "satisficing" model in which a sub-optimal but satisfactory solution is found to be adequate for a policy issue. Herbert Simon wrote in the 1950s about "bounded rationality" in relation to satisficing, stating that "... decision makers would sacrifice complete objectivity in order to satisfy the need for a speedy and workable solution" (Davis et al 1993: 160).

The incremental policy model first proposed by Charles Lindblom in the 1950s has proved resilient as a descriptor of the policy process. Lindblom referred to the "science of muddling through" and saw most policy outcomes as marginal changes based on past experience. Dye dismisses the rational policy model completely, stating that " ... there are so many barriers to rational decision-making that it rarely takes place at all in government ..." (Davis et al 1993: 161).

More recent models have been proposed by other writers including Etzioni and Dror. The "iterative mixed-scanning model" developed by Etzioni (Davis et al 1993: 167) sees policy as a choice among different options considered. Cohen et al (Davis et al 1993: 172-3) proposed a "garbage can" model of policy, in which a " ... complex but random combination of problems, solutions and participants ... move from one choice opportunity to the next".

Public Policy and Agenda Setting

There are also theories of decision making and agenda setting that abound in the public policy literature, and these sometimes overlap with understandings of the policy process more generally. They are clearly important in a study of policy change. According to Dye, "who decides what will be decided" is the most important stage of the policy-making process (Dye 1992: 334). Again, Davis et al state that "how decisions are made is an integral part of public policy" (Davis et al 1993: 157).

444 Lasswell identified seven stages of decision making – intelligence, recommendation, prescription, invocation, application, appraisal and termination. Equally, Bridgman and Davis has described a "policy cycle", involving a number of sequential stages in the decision-making process (Bridgman and Davis 1998: 21-29), including setting the policy agenda:

There is a crucial moment in the policy cycle, a point at which a private concern is transformed into a policy issue. Suddenly the concern commands the resources of government, while a myriad of others languish as merely private concerns (Bridgman and Davis: 1998: 30).

Downs has written about the "issue attention cycle", and how issues briefly capture the public imagination, then quietly fade from view, without necessarily being resolved. Writing in 1972 about the coming to prominence of the environmental movement, Downs stated:

American public attention rarely remains sharply focused upon any one domestic issue for very long – even if it involves a continuing problem of crucial importance to society (Downs 1972: 38).

In his issue attention cycle:

Each of these problems suddenly leaps into prominence, remains there for a short time, and then – though still largely unresolved – gradually fades from the center of public attention (Downs 1972: 38).

Downs saw the characteristics of issues that go through the attention cycle as follows:

1. the majority of people not suffering from the problem nearly as much as a minority;

2. sufferings caused by the problem are generated by social arrangements that provide significant benefits to a majority or a powerful minority of the population;

3. the problem has no intrinsically exciting qualities – or no longer has them (Downs 1972: 41).

On the face of it, the issue of balanced development lends itself to analysis in terms of Downs issue attention cycle.

Bachrach and Baratz explored the notion of "non-decisions" and how certain political issues come to be kept off the policy-making agenda. According to them:

A non-decision ... is a decision that results in the suppression or thwarting of a latent or manifest challenge to the values and interests of the decision-maker ... non-decision-making is a means by which demands for change in the existing allocation of benefits and privileges in the community can be suffocated before they are even voiced; or kept covert; or killed before they gain access to the relevant decision-making arena; or failing all these things,

445 maimed or destroyed in the decision-implementing stage of the policy process (Bachrach and Baratz 1970: 44).

Elsewhere, Bachrach and Baratz refer to occasions:

... when dominant values, and accepted rules of the game, the existing power relations among groups ... simply or in combination, effectively prevent certain grievances from developing into fully-fledged issues which call for decisions (quoted in Davis et al 1993: 170).

The concept of non-decisions and the nature of the agenda setting process is clearly of interest in examining the consistent failure of balanced development to achieve policy prominence in the 1980s and 1990s, despite the continued dominance of the NSW economy by Sydney and the persistent calls from regional areas for its implementation. Hurley has referred to decentralisation as "... an event which did not happen", despite its acknowledgement over many years as a political objective. In some ways, the study of the place of balanced development in regional policy in in recent times has been about "non-decision-making".

Consistent with Bachrach and Baratzs theme, there have been frequent accusations of "Sydney-centrism" or "metro-centrism" by balanced development supporters and others, consistent with the view that city based "elites" or interest groups have continued to hold sway over successive governments. Yet Bachrach and Baratz suggest that, not only do policies occur in the absence of clear decision making (as in Lindlom 1968, quoted elsewhere), but that there is a "conspiracy" to keep certain matters off the political agenda. This is a much stronger claim, and one that is far more difficult to sustain, for example in the case of balanced development.

Models of the Policy Process

In summary, public policy analyses offer rich opportunities for extending the depth of analysis of regional policy making and the decline of balanced development in New South Wales.

• The rational model – did various New South Wales and Commonwealth governments since 1975 reach conclusions about regional policy options in response to perceived regional problems? (Chapter Six)

• The incremental model – did governments simply build on earlier regional policies in the 1980s and 1990s and change policies at the margin, in effect "muddling through", or was there a more fundamental shift (as in Kuhns notion of paradigms; Kuhn 1970)? (Chapter Nine)

• The ideological model – did regional policy development reflect new ideas or new thinking among decision-makers about regional development since the 1970s? (Chapter Eight)

• The interest group model – did regional policy outcomes reflect the playing out of group politics or the agendas of opinion leaders? Were the interests/ideas relating

446 to the push for balanced development well represented and were the actions of its champions effective? (Chapter Seven)

• The satisficing model – were regional policy outcomes simply sub-optimal but satisfactory alternatives to the preferred solution (that is the solution sought by proponents of balanced development)? (Chapter Nine)

• The non-decision model – did balanced development disappear from the regional policy agenda as a result of deliberate decisions, or was it a case of non-decisions causing its ultimate decline as a policy objective? If it was a case of "policy inertia", was this a deliberate strategy on the part of interests opposed to the pursuit of balanced development (see Polsbys critique of Bachrach and Baratz; Polsby 1980). (Chapter Nine)

In applying these models to political events in New South Wales, it may be possible to draw reasonably firm conclusions about the causes of the decline of balanced development as a regional policy objective in New South Wales since 1975. It should be noted that the purpose of developing and testing models of policy processes, decision making and agenda setting is not to prove the efficacy of one model over others, but to shed further light on the changes that have occurred in regional policy.

447 Appendix I

Overview of the New South Wales Political System

While government policies will be considered at both State and Commonwealth level in the thesis, the subject is closely linked to the New South Wales polity. This is the stage, as it were, on which the action takes place.

Unusually, given the importance of the State to the national economy and society, relatively little has been written about New South Wales politics, and even less about policy making. For example, only one book has been written on the Greiner and Fahey Coalition Governments (Laffin and Painter 1995). A number have been written on the Wran Government, largely focusing on Wran personally. There is little that has been written on the Askin Government and its Coalition successors (1965- 76), a period critical to the thesis. A number of works have dealt with the major political parties, but often these have more been focused on politics at the Commonwealth level.

New South Wales has largely been a "Labor State". For example, Labor held office uninterrupted for 24 years from 1941 to 1965, from 1976 to 1988, and since 1995. For the principal period under consideration in the thesis, from 1975-76 to the present, New South Wales has experienced considerable years in government by both the major parties, with Labor holding office for eighteen years and the Coalition for seven years. The Coalition also held office from 1965 to 1976, a period which is also considered in the thesis.

At the Commonwealth level, there have also been considerable periods of government by each of the major parties during the time under review. The Coalition has held power for thirteen years and Labor also for thirteen years. In the years from 1965 to 1.975, the Coalition held office for seven of the ten years.

The Coalition consists of the largely (though not totally) city-based , normally the senior partner in the Coalition, and the National (formerly Country, then National Country) Party, which holds seats only in the non-metropolitan region. The National Party has been strong particularly in regions such as the North Coast and the New England, though this is changing due to demographic shifts and a recent willingness of country voters to abandon their traditional voting patterns.

The Coalitions ideology has a mix of support for free enterprise and, in the case of the National Party, for support for regional areas based on its core philosophy of "countrymindedness". Clearly this has been a recipe for tensions, since support for regionally based policies, especially where they involve elements of protection (such as in statutory marketing arrangements for agriculture), runs directly counter to the Liberal Partys free enterprise beliefs.

The NSW Labor Party generally garners its electoral support from the greater metropolitan region, including strong pockets of support in the industrial Hunter and Illawarra areas. However, while Labor seldom holds more than a handful of country seats, the Party has a history of success in country regions, for example during the

448 Wran and (current) Carr Government periods (see Appendix J). Generally, Labor Governments at State level have been less interested in regional development than their Federal counterparts. The activism of Labor at the national level must be seen, however, in the context of its general definition of "regional" as including metropolitan regions.

In the case of the Coalition, the reverse has been the case, in that Coalition governments in New South Wales have been far more interested in regional development than their own national colleagues. This is largely due to the States rights issue, the view that the Constitution allocates the issue of regional development to the States.

While all governments need to win at least some country seats to be assured of a solid majority in the New South Wales Legislative Assembly, the power of the non- metropolitan constituency has waned considerably over the course of the last century due to the urbanisation process and the increasing dominance of the States population by the metropolitan region. For a time in the 1970s, the country was protected electorally by a quota system whereby country New South Wales was guaranteed one third of the States then ninety seats.

Regional development interests have achieved representation through the National Party traditionally, and more recently through the rise of Country Independents and the formation of "Country Labor", a formal branch of the ALP. Local government, while being generally weak in the face of State government and facing perennial and increasing financial stresses, has been for many years a strong supporter of regional development.

Government in New South Wales has generally been dominated by strong leaders. Power is centred in the Cabinet, and the Premier plays a critical policy and coordination role. Strong central agencies, particularly the Treasury, the Public Service Board (until its abolition in the late 1970s), and more recently The Cabinet Office and the Premiers Department, provide a further element of centralisation. It should also be noted that the central agencies, particularly the Treasury, have been generally long-term and consistent supporters of the free market, and this has had implications for interventionist regional policies.

Since colonial times, government and administration have been focused strongly on Sydney, much to the continuing frustration of non-metropolitan interests.

The State has lacked the role of a coordinator general backed by legislation, unlike, for example, the Queensland model. Hence State development agencies have not acquired the status of a central agency of government, and have therefore been subject to the normal, sometimes tense, relations with central agencies experienced by most line departments.

Overall, New South Wales government is marked by the politics of convergence. While the stuff of State government generally is largely devoid of ideological content, in New South Wales the political parties have increasingly grown similar in their political management styles and policy approaches. Much of State government priorities, whichever party is in office, revolve around service delivery with the

449 perennial issues of electoral importance being education, health and law and order. The parties similarly pursue State development and support for resource development, investment, industry and jobs. There has been a general reluctance to overturn the policy approaches of previous administrations in the area of development policies.

450 Appendix J

The State ALP and Country Voters

The NSW Labor Party has had a long and relatively successful relationship with regional voters, continuing to the present Carr Government. This has at times continued while country voters were not well disposed towards national Labor governments. As Simms and Turner have noted:

One of the distinctive features of NSW Labor has been its persisting ability to appeal to country areas, even though the bulk of its support has long been found in metropolitan and industrial-mining areas (Simms and Turner in Chaples et al 1985: 109).

According to Jack Hallam, Minister for Decentralisation and Minister for Agriculture in various Wran administrations:

Political allegiance by class is less binding in rural and provincial towns and cities (with the exception of industrial towns or cities such as Broken Hill) than in Sydney, Newcastle and Wollongong. This is because of the importance in country areas of regional loyalties (Hallam quoted in Chaples et al 1985: 109-10).

The Labor Partys strength in regional New South Wales is not new, and goes back to its very early days. In fact, only six of the ALPs then 25 Legislative Assembly seats it held in 1904 were from Sydney. The ALPs regional strength was particularly reinforced by the legacy of Premier McKell and his successors as Premier from the 1940s (See Clune 1984 a and b)

According to Wrans Press Secretary Brian Dale, referring to what he has termed to the "scrub vote":

McKell showed the ALP that there was life, and votes, on the western side of the Great Dividing Range (Dale 1985: 35).

McKells strategy had been built around both political strategies and policy decisions. As Simms and Turner have noted:

Sensitive to the problems of small farmers, he included realistic policies on rural finance and debt postponement, farm rehabilitation, tenure conversion, closer settlement, farm mechanization, rural electrification and decentralization (Simms and Turner in Chaples et al 1985: 114).

Interestingly, McKell is said by Simms and Turner to have "... sold to the party and to the electorate a master plan of balanced development" (Simms and Turner in Chaples et al: 114). According to Clune:

451 The election of the Wran Labor Government in 1976 saw a conscious attempt to revive the McKell legacy and rebuild Labors rural strength in NSW (Clune 1984a: 97).

Wran said that the State Opposition believed that many country people deserved special treatment in government policies on employment, education, decentralisation and rural subsidies (Dale 1985: 34). According to Clune, the Wran Cabinet met in country regions on seventeen occasions between 1976 and 1983. These Cabinet meetings were invariably followed by announcements of initiatives specifically favourable to the region visited (Clune 1984a: 97-98). As Clune has pointed out, representation in Cabinet of country members, including in senior portfolios and disproportionate to their numbers in Caucus, won further favour in the country (Clune 1984a). Policy decisions such as the extension of the XPT train services also gained favour with regional electorates.

Wraps success raises the question as to whether country voters see "regional development" more in terms of government decisions generally favourable to them rather than in terms of decisions specifically designed to enhance balanced development.

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Notes

1. In addition to the references above, numerous regional and metropolitan newspapers were consulted, too numerous to include here. Well quoted, they are referred to individually in the text.

2. The author attended meetings of the CMA between 1995 and 2001 as part of the research for the thesis. Where information gained from these meetings is used in the text (principally in Chapter Seven), it is acknowledged in footnotes. In addition, the author was involved directly in a number of internal DBRD and DSRD regional policy discussions that had a bearing on events described in the thesis. These are acknowledged in footnotes to the text where appropriate.

485 3. A number of informal discussions took place with key informants. Those quoted in the text are Warwick Bennett (November 1996), former Chairman of the CMA, and Professor John Steinke (May 1998). Other discussions included the following:

• Professor Patrick Troy (former adviser to Tom Uren and Deputy Secretary, DURD) • Mr Bob Lansdown (former Secretary, DURD and EHCD) • Mr Keith Coughlan (former Associate Commissioner, Cities Commission) • Ms Narelle Kennedy (author of BACA 1989) • Associate Professor Chris Cunningham (former employee of DDD and SPA) • Professor Kevin Sproats (see above) • Dr Glen Searle (see above) • Mr Phil Day (former Director, DDD)

486