Extract from Hansard [COUNCIL - Wednesday, 3 December 2008] p793b-802a Hon Ray Halligan; Hon Peter Collier

SELECT COMMITTEE INTO PUBLIC SECTOR EXPENDITURE Establishment — Motion, as Amended Resumed from 27 November on the following motion, as amended, moved by Hon Sue Ellery (Leader of the Opposition) — That — (1) A select committee of three members is appointed, any two of whom constitute a quorum. (2) The committee and the proceedings of the committee are subject to chapter XXII of standing orders and it is to be regarded for all purposes as a committee appointed under that chapter. (3) The committee is to inquire into and report on government measures to audit the operational and financial performance of the Western Australian public sector and any other means by which efficiencies in public sector expenditure can be gained, and all the circumstances surrounding the implementation of the three per cent efficiency dividend, including — (a) the impacts of the three per cent efficiency dividend on the general level of service delivery across all agencies, in particular any impacts on service delivery to regional areas; (b) considering alternative methods for achieving a three per cent reduction in government expenditure; (c) whether the efficiency dividend has a disproportionate impact on smaller agencies, including whether or not smaller agencies are disadvantaged by poorer economies of scale or a relative inability to obtain funding for new policy proposals; (d) what measures agencies are taking to implement the efficiency dividend, and the effect on their functions, performance and staffing arrangements; and (e) alternatives to an across-the-board efficiency dividend to encourage efficiency in the public sector, including consideration of whether certain agencies or functions of agencies should be exempt from the efficiency dividend, or whether the rate of the dividend should vary according to agency size or function. (4) The committee may present interim reports without a requirement for leave and is to present its final report to the house not later than Tuesday, 12 May 2009. HON RAY HALLIGAN (North Metropolitan) [4.13 pm]: We have been debating this motion to establish a select committee to look into a number of matters. I and other members who have spoken in the debate have mentioned that it is very much the right of Parliament to play a role in checking on the government of the day— the executive. However, some members have questioned whether a select committee is the best way to approach this problem, if I can call it a problem. I am sure that many members in this chamber would call it a problem, because on many occasions it has been difficult for them to obtain information from successive governments to satisfy them regarding the expenditure on certain services provided by government. As I have mentioned, this has occurred irrespective of which party has been in power, because quite frequently the accounting is changed to protect certain people and certain information. I must admit that I have not heard what Hon Giz Watson is likely to support in this regard. However, as the chair of a standing committee that has been set up specifically to look at this type of issue, I imagine that that committee would appear to her, as it does to me and to others, to be the way forward to provide the checks and balances that this house requires to bring the government of the day to account. It would surprise me greatly if Hon Giz Watson supported this motion to establish a select committee to do something that the standing committee that she chairs can do. I understand the frustration of many members on both sides of the chamber on this issue. I will read into Hansard certain information that I will extract from the Australasian Parliamentary Review. An article headed “Accounting and Accountability” written by Rosemary Laing, who is the Deputy Clerk of the Senate, states — So what had happened to parliamentary control? This is what a minister had said to a parliamentary seminar on government expenditure and accountability held by the Public Accounts Committee in May 1980: Despite this over-riding power of Parliament I am sure all members of Parliament have on at least one occasion asked themselves whether this power is more imaginary than real and whether the power given is exercisable either before the event or after the event. That is exactly the situation that we are in, and that was 28 years ago. It goes on to say —

[1] Extract from Hansard [COUNCIL - Wednesday, 3 December 2008] p793b-802a Hon Ray Halligan; Hon Peter Collier

It is true that section 83 of the Constitution requires that no money shall be drawn from the Commonwealth Treasury except under appropriations made by law. This should not be taken to mean that Parliament controls expenditure. The word control means power of directing or command and in the context of expenditure it should be used in the sense of the ability to determine the size and composition of public expenditure. This the Parliament does not do — the government party is in a majority which has a vested interest in supporting the proposals of the Executive. It is thus difficult to see how the House can control a situation when its own majority has to support the Executive. As in the fable of the Emperor’s new clothes, parliamentary control of expenditure is a myth that all concerned have every reason to foster. I think that is exactly the same situation that we are in at a state level. Her article also states — Accounting and accountability are far from synonymous. She concludes by saying — Eternal vigilance by the Auditor-General and by parliamentary committees from their own unique perspectives is required to ensure that accounting remains the servant of accountability, not its substitute. That is certainly something I agree with. I believe we must remove the expectation from our minds that every member of the executive, every member of the government and every public servant can be called to account and asked to bring truckloads of information to this proposed committee—I suggest it should be a standing committee—wherever it might sit, and expect the committee to go through every document to determine what in fact the executive should be doing. There is no doubt that members on the other side of this chamber, who are now in opposition, know full well many of the problems associated with the government—a government that they controlled for seven and a half years. They know the issues. They do not know the solutions—that is obvious—otherwise we would not be going down the path that they suggest at this time. As to accounting and accountability, I wonder whether Labor Party members recall the words in the document I am holding. Under the heading “Questioning the government”, it states — An Australian government’s attitude to its accountability to the lower house was epitomised by the claim by Deputy Prime Minister Keating that question time was not a right, it was a privilege granted by the government. That seems to be the attitude of Labor Party members when they are in power, but it changes dramatically when they sit on the other side of the chamber. I said that it would surprise me if Hon Giz Watson supports this motion, as amended, to create a select committee. I will quote again from the Australasian Parliamentary Review, which refers to a conference in 2006 in Wellington, New Zealand, at which Hon Giz Watson presented a paper about the committee she chairs; that is, the Standing Committee on Estimates and Financial Operations. She said — The Committee’s terms of reference are extremely broad, enabling the Committee to initiate investigations relating to any aspect of the financial administration of the State. This includes inquiry into any matter relating to past, current, proposed and future expenditure by the public sector. The terms of reference are very broad indeed, and provide an opportunity to undertake the work that members opposite wish the proposed select committee to undertake. Hon Giz Watson’s paper went on — The Committee is aware of its limitations both in relation to the resources available to the Committee but also in relation to the time constraints that Members of Parliament have. Whilst the Committee does not have the capacity to look at every single issue relating to the financial operations of government, it can examine key aspects and it can foster a general awareness across government that the Parliament is active in its scrutiny function and that there is a chance that the agency may be called in to appear before the Committee. I mention that for two reasons: one is again that the Standing Committee on Estimates and Financial Operations as an existing standing committee of this place has the capacity to undertake such an inquiry and to overcome the difficulties any committee would have in undertaking all the work under the terms of reference that we are debating today. I have read part of the motion, as amended, before and I will repeat it — (3) The committee is to inquire into and report on government measures to audit the operational and financial performance of the Western Australian public sector and any other means by which efficiencies in public sector expenditure can be gained, and all —

[2] Extract from Hansard [COUNCIL - Wednesday, 3 December 2008] p793b-802a Hon Ray Halligan; Hon Peter Collier

I repeat and emphasise “all” — the circumstances surrounding the implementation of the three per cent efficiency dividend … The expectation, if we are to read that literally—I cannot understand why we would not, and we cannot second- guess it; if opposition members do not mean it, they should not say it—is that the proposed select committee would look at absolutely everything, yet the motion, as amended, seeks a select committee of only three members. Hon Giz Watson said that her committee comprises 34 members—the total number of members of this chamber—and because of a lack of resources, her committee members have enormous difficulties in undertaking the tasks that they set themselves. I therefore do not believe for one moment that referral to a select committee is the way to go. I do not believe that the terms of reference in the motion, as amended, are appropriate for the proposed select committee, should the majority of this place decide that it should be established. I believe that the standing committee itself has the appropriate terms of reference—admittedly it may not have the resources at this time—and, if it wishes, to can look at pertinent aspects of government proposals and government expenditure. However, I wish to amend the motion, as amended, in the following way. Establishment — Amendment to Motion, as Amended Hon RAY HALLIGAN: I move — (1) To delete paragraph 3(a) and insert instead — (a) the impact of the current financial crisis on the state’s economy and finances; (b) the sustainability of the rate of growth in general government expenditure detailed in the 2008-09 budget; (c) the sustainability of the forecast decrease in operating surplus detailed in the 2008-09 budget; (d) the sustainability of the forecast increase in net debt detailed in the 2008-09 budget; (e) the impacts of the three per cent efficiency dividend introduced by the former Treasurer, Hon , MLA, and announced in the Pre-election Financial Projections Statement in August 2008 on the general level of service delivery across all agencies, in particular any impacts on service delivery to regional areas; (f) the impact of failing to fully implement the three per cent efficiency dividend on the operating surplus and net debt; (2) In original paragraph 3(e) — To insert after “function” — , and, if so, specific advice on which agencies or functions should contribute a disproportionate share of the $1 449 million in savings over the forward estimates identified by the former Treasurer, Hon Eric Ripper, MLA, in August 2008. HON PETER COLLIER (North Metropolitan — Minister for Energy) [4.30 pm]: Although I have some sympathy for the amendment to the motion, I rise today to speak against the motion. It is an extremely audacious motion because it asks for this chamber to establish a select committee to discover details that the opposition already has. Quite frankly, this is a waste of resources. I have listened to the argument since its commencement, and I have been swayed quite heavily by the argument of Hon George Cash. Dare I say that the old political juices started flowing when I thought about my first-year politics course with Ralph Pervan, Paddy O’Brien and Barbara Hamilton at the University of , when we learnt extensively about the separation of powers. I thought about that in relation to this motion. If we were to support this motion we would seriously compromise the whole basis of our democratic system in terms of the separation of powers. I do not mean to be melodramatic here; I am quite serious about it. Australia has a wonderful democratic system. We have a bicameral parliamentary system, a federal system, and three levels of government. There is a bit of blurring in the separation of powers between the legislature, the executive and the judiciary, but this motion seeks to further compromise and blur the boundaries of the separation of powers. I will address my first comments on this. Part three of the original motion reads, in part — The committee is to inquire into and report on government measures to audit the operational and financial performance of the Western Australian public sector, and any other means by

[3] Extract from Hansard [COUNCIL - Wednesday, 3 December 2008] p793b-802a Hon Ray Halligan; Hon Peter Collier

which efficiencies in public sector expenditure can be gained and all the circumstances surrounding the implementations of the three per cent efficiency dividend including — (a) the impacts of the three per cent efficiency dividend on the general level of service delivery across all agencies; in particular any impacts on service delivery to regional areas; (b) considering alternative methods for achieving a three per cent reduction in government expenditure; I have a problem with that, for a number of reasons. Firstly, as far as the opposition is concerned the motion is redundant. The opposition knows how that three per cent dividend can be achieved. It must know, because it was the idea of the former Treasurer. I should amend the motion again and call for the establishment of a select committee inquiring into the basis upon which the former Treasurer, Eric Ripper, committed the former Labor government to a three per cent efficiency dividend. That would be more appropriate, because the then Treasurer came out, miraculously, just before the election was called and said that the government intended to impose a three per cent efficiency dividend, which would free up close to $1.5 billion for the then government to pork- barrel into election promises, in anticipation of being able to roll out a raft of policies, and the present government followed this. The three per cent efficiency dividend of this government mirrors that of the previous government. We did not have access to all the resources and all the government departments before we set our efficiency dividend. We had to assume that the government was telling the truth. Hon George Cash: They had special knowledge. Hon PETER COLLIER: The previous government had intimate knowledge of the operations of every government department. It would have to be assumed, in that instance, therefore, that the Treasurer had got the tick-off from cabinet and the Treasury for an efficiency dividend. If not, it would be highly improper for the Treasurer to come out and say that he intended to impose a three per cent efficiency dividend when he had not done his homework. For the opposition to now call for a select committee to determine where the government will get the money from is an absolute waste of time and effort. That is the first issue I want to deal with in my comments. I want to make it quite clear that this policy of the three per cent efficiency dividend came from the previous Labor government. I will reinforce that by reading just a couple of press articles. Firstly, I will read an article from on 18 August 2008, entitled “Ripper to demand public service cuts to cover Labor promises”. It reads — Treasurer Eric Ripper has conceded that all WA Government agencies would be asked to cut spending by 3 per cent despite insisting that frontline services would not be harmed in the efficiency drive to pay for Labor’s election promises. The Treasury’s pre-election financial projections statement released at the weekend shows the Government would reap an extra $2 billion in surplus over the next four years on top of current projections. But close to $1.5 billion of that is expected to come from the so-called 3 per cent efficiency drive with the rest from increased iron ore, oil and gas royalties. Mr Ripper said yesterday that the police, education and health departments would be asked to trim 3 per cent from their projected costs. However, because frontline services were so important, the Government would look closely at how they proposed to deliver those savings. “We give managers the new target and we then engage in debate with them about what they can do to meet that target,” he said. “That means it won’t be 3 per cent uniformly in all agencies because there will be some agencies that will have good arguments that they can’t achieve 3 per cent and therefore we’d be looking at another agency to do better than 3 per cent.” “In a $20 billion budget, there will be low-priority programs and back-office operations where we can cut back and the whole purpose of the exercise is to focus our resources on frontline services.” I also quote an article from The West Australian of 23 August, written by Paul Murray. It states — State Cabinet’s decision to create a $1.45 billion windfall by seeking a 3 per cent efficiency boost from the WA public service was made just one week before Alan Carpenter called the snap September 6 election.

[4] Extract from Hansard [COUNCIL - Wednesday, 3 December 2008] p793b-802a Hon Ray Halligan; Hon Peter Collier

Treasurer Eric Ripper confirmed yesterday that the decision was taken on July 29 after passing through the Government’s expenditure review committee the previous week. The effect of the decision is to give the Government an extra $1.45 billion in potential election promises. It is the first time since the “efficiency dividend” became public last weekend in the mandatory pre- election financial projections statement that Mr Ripper has disclosed the decision was taken so close to the Premier’s August 7 poll announcement. … Mr Ripper maintained that the Treasury and Finance Department had analysed agency spending and the 3 per cent was based on its advice. That answers my earlier questions. The Treasurer had actually taken it to the cabinet expenditure review and got the tick-off. Members opposite, especially those who were ministers, were party to this decision. They are aware of and understand the decision. They understand that the three per cent efficiency dividend could have been provided. Hon Kim Chance: As we did in 2001. Your assertion that we knew about it is quite right, proven by the fact that we did it successfully in 2001, at a saving of between $830 million and $850 million. Hon PETER COLLIER: So from where did the opposition come up with the figure of $1.5 billion? Hon Kim Chance: That is three per cent; in 2001 it was 1.5 per cent. Hon PETER COLLIER: Why do we need this select committee if the opposition already knows where it came from? Hon Kim Chance: We want to know whether you know. Hon PETER COLLIER: Right—I rest my case! That is fair enough; that is fine! Paul Murray wrote an opinion piece on this issue, and he got it in one. I will read bits and pieces of it, because it is very good, but rather lengthy. It is from The West Australian on 23 August 2008 and is entitled, “Ripper the magician raises poll war chest”. It reads — Wouldn’t it be great to be able to make money appear just because you say it exists? Every time you want an expensive holiday—or if a big bill arrives—you could just conjure up the idea of a couple of grand in your savings account and, lo and behold, when you go to the ATM, it’s there. Well, that mild and unassuming Eric Ripper has shown he can do just that. Half Fiscal Superman, Half Mandrake The Magician. And Mr Ripper is not just planning to get enough cash for a week on Rottnest. He’s made $1.45 billion appear out of nowhere. So he must be planning a really long break. Or maybe he just thinks that Premier Alan Carpenter is about to run up some big bills in election promises that he will have to pay. And maybe that’s why he pushed this fanciful creation of nearly $1.5 billion through the Cabinet just one week before Mr Carpenter called the State election. Yes, right on the death knell. How convenient. If a fiscally responsible government wanted to do that this year, why wouldn’t it be included in the May Budget? Why wait until election eve? Mr Ripper’s Mandrake act was quietly announced last weekend in what is bureaucratically known as the Pre-Election Financial Projections Statement. The statement is designed to show changes in the Government’s finances between the Budget cut-off date—this year it was April 7—and the calling of the election, which was on August 7. This year that is a very short period because Mr Carpenter called the election nearly six months early. So you’d expect very few changes from what was planned at Budget time. No so. Out of the statement pops up a previously unannounced decision to impose a “one-off efficiency dividend of 3 per cent on appropriation-supported agencies with effect from January 1, 2009”. The effect of that previously secret decision was to create an extra $1449 million in the Government’s coffers. At the stroke of a pen.

[5] Extract from Hansard [COUNCIL - Wednesday, 3 December 2008] p793b-802a Hon Ray Halligan; Hon Peter Collier

My suspicions were immediately raised, especially when no date was given for the Cabinet decision backing the move. It’s nearly eight years since the Government tried to achieve such an efficiency dividend—which raises in the mind of the public visions of a bloated bureaucracy—and the move also posed a question why it was not done as part of the pre-election Budget, instead of shortly after one. The PFPS is meant to be a disclosure statement, but it discloses very little about this big heap of money. There is no detail about how the decision was made, what cuts will be administered and how the magical figure of 3 per cent was devised. Why not 4 per cent? Or one per cent? “The efficiency dividend is to be applied to appropriation-funded agencies and to all categories of expense other than grants and (non-cash) depreciation costs,” the statement baldly says. “Across the forward estimates period, this measure is expected to reduce expenses by a total of $1449 million. “Consistent with the Government’s decision prior to August 7, 2008, the dividend is reflected as an adjustment to the overall expense aggregates of the State in these PFPS estimates, and would normally be allocated to individual agencies as part of the 2008-09 mid-year review process.” The article continues — So I asked Mr Ripper this week when and how he managed to create this mountain of cash. Mr Ripper confirmed what I had expected. Cabinet approved the efficiency dividend figures on July 29, with the spendfest of a poll clearly in its sights. Nine days later the election was called. “Both the Government and the alternative government support the dividend,” Mr Ripper said coyly. Well, of course the Liberals have to agree to it. To refuse it would give the Government $1.45 billion more to spend than the Opposition, which would be political suicide. However, there are two downsides to creating this magical pool of money. The first is that it raises difficult political questions about where the cuts will be made to carry it out. Three per cent is quite a deep saving. The second is that you also create a war chest for your political opponents, who might be able to spend it in a more attractive way than you. He has got it right there. The article continues — Mr Ripper’s explanation of where the money will come from is hardly convincing—nor is his rationale for how the 3 per cent figure was decided. “We will trim some low-priority programs such as staff travel and identify back-room bureaucracies,” Mr Ripper said. There we go: that is how the Labor Party did it—by reducing travel and backroom bureaucracies. Hon Kim Chance: Look at what we did in 2001. Hon PETER COLLIER: That is seven years ago. The article continues — “Front-line services such as police, nurses and teachers will grow as per our election commitments,” the Treasurer said. Well, I guess you could hardly announce that you planned to cut them at the same time as you’re announcing increases to them. But where did the 3 per cent figure come from? Well, Mr Ripper claimed that the Department of Treasury and Finance had undertaken a review of agency spending, but didn’t say when. “The 3 per cent figure was based on advice from DTF which took into account low-priority programs and discretionary spending activities such as staff travel and conferences,” Mr Ripper said. “Because the 3 per cent only applies for six months of the 08-09 financial year, it equates to 1.5 per cent on a 12-month basis. “DTF has identified that agencies have a pattern of underspending by about one per cent. On the basis of that advice, we expect the ED for 08-09 will be readily achievable.” So will Mr Ripper release any reports that justify the Cabinet magic? “No—they are Cabinet documents and the usual confidentiality rules apply,” he said.

[6] Extract from Hansard [COUNCIL - Wednesday, 3 December 2008] p793b-802a Hon Ray Halligan; Hon Peter Collier

It is interesting how standards slip! So we’ve really got no way of checking whether this $1.45 billion will become a reality or whether it’s just a convenient amount put into the books against which election promises can be made. Without having done anything—except to fill out a column of figures—and with no intention of doing anything until the start of next year, the Treasurer has been able to conjure an election war chest out of thin air. Mr Carpenter claimed he called the election early because everything the Government did was being viewed cynically. This bit of election-eve cynicism takes the cake. It is like — Hon George Cash: That is a very perceptive article. Hon PETER COLLIER: Absolutely. That was one of Paul Murray’s better articles, although he has been writing extremely good articles in the past few months. That was an excellent article which hit the nail on the head; it is exactly what I was saying. If the opposition had a genuine desire to find out where this three per cent efficiency dividend was going to come from, it would not need to call for the formation of this select committee. It does not need to call for the formation of this select committee because it already has that information. Hon George Cash: It’s got the documents. Hon PETER COLLIER: It has got the documents, it did go to cabinet. To say that it wants to establish a select committee and haul public servants in front of that select committee, and potentially haul a raft of other advisers and members of Parliament into that select committee to tell it what it already knows—or should already know—is absurd. It is an absolute waste of resources. That is why I cannot support this motion. Hon Kim Chance: Have I misunderstood you? Are you actually offering the opposition the opportunity to construct the next budget? Hon PETER COLLIER: No, not at all. I am saying — Hon Kim Chance: Because we’ll probably take you up on it! Hon PETER COLLIER: Not at all. I say that this is nothing more that political posturing. That is all it is, and that is why the government cannot support the motion. Obviously, there is a lack of communication between the former Treasurer and the now shadow Treasurer, because the former Treasurer obviously had that intimate forensic detail of how he could conjure up a three per cent efficiency dividend to produce almost $1.5 billion. That information went to Treasury and it went to cabinet, so it was ticked off. It was announced publicly that, yes, we have this amount of money. Members would assume, therefore, that the former Treasurer would have relayed that information to the now shadow Treasurer, but perhaps there is a bit of a communication problem. On Wednesday, 29 October 2008 shadow Treasurer Ben Wyatt took part in an interview on 720 ABC, during which Geoff Hutchison asked him about the three per cent efficiency dividend. Geoff Hutchison said — We’re all a bit fiscally flustered aren’t we? So to the Barnett Government, feeling the heat of growing criticism about its three percent spending cuts in the public service. Troy Buswell yesterday refused to guarantee that core services would be insulated by the cuts, so we’re still to learn if exceptions will be made on police resourcing, plans for more nurses and teachers in our health and education system. I do know that the Police Minister met with the Police Commissioner yesterday and… there was some measure of satisfaction from those talks, but nothing further has been revealed there. Ben Wyatt is the shadow treasurer. … Where do you think cuts can be made? BEN WYATT Well the one reason Troy Buswell hasn’t guaranteed that core services won’t be cut, is because he can’t make that guarantee. It’s really more of that ham-fisted style that has characterised Troy Buswell’s political career to date. It’s now being replicated in how he intends to apply this three percent efficiency dividend. And Geoff, it’s important to note that the purpose of the dividend is to be very surgical in how it is applied. If you were simply going to apply a rule across all areas of the public sector, that you must find a three percent efficiency dividend. It is a lazy way to implement public policy and I can guarantee there will be cuts in frontline services. GEOFF HUTCHISON That said, your government intended to pursue similar cuts. Now before I ask where you were going to cut, here’s what Troy Buswell had to say on Russell’s Drive program yesterday.

[7] Extract from Hansard [COUNCIL - Wednesday, 3 December 2008] p793b-802a Hon Ray Halligan; Hon Peter Collier

TROY BUSWELL [FILE] I just need to point out that… it was actually a cut in spending that was introduced by Eric Ripper and the Labor Party when they were in Government and they set the rules and they set the parameters… we’ve accepted the challenge now of implementing it. So … I do find it quite odd that the … former government who introduced this, are now saying that it shouldn’t apply to certain peoples when they know for well that it … it applies across the board to all aspects of the public service. GEOFF HUTCHISON Okay, so why were yours going to be surgical and why are his ham-fisted? BEN WYATT Well Troy Buswell’s wrong on two points there … Firstly, the rules and parameters weren’t designed for the … to simply a blanket rule. It was a dividend that Eric Ripper indicated we … that we will apply. Troy Buswell didn’t have to accept that, it’s not a … it’s not a legislated mandate that he has to do this. He’s accepted that, we were going to be very surgical, were gonna focus on those areas that wouldn’t undermine the core delivery of … of public services. GEOFF HUTCHISON Okay … BEN WYATT … Can I say Geoff, one point … the ALP has done this before. In the 2001 election the ALP commitments upon victory were met from an efficiency dividend that was committed to by , and speaking to Geoff and speaking to Eric, it was clear that was hard work. There were lots of meetings and lots of focussed cuts in … to meet those commitments that were made back in 2001. GEOFF HUTCHISON So, very specifically how would you have been able to make these cuts in ways that this Government seems to be struggling with? How could you have done it without affecting these core services? BEN WYATT Well I would have seen … I mean … straight up, being shadow treasurer I … you ought to see … one percent of … that three percent would come in the under-spend that government departments have been making in any event. Now, there are other government departments and areas in government departments that perhaps are more subject to … to cuts in these areas. Now that’s hard work, Troy needs to go through line by line with his Ministers and work out where those are … they are. Members should take note that he does not say that we need a select committee to determine where it is. He is doing the right thing—going through the processes and saying that he will go through it with his ministers. The transcript continues — I’m not in that position to sit down with the various department bureaucrats and work where they are, — As the former Treasurer did — but as Geoff found … Gallop found out in 2001, it was difficult but it could be done. This is the challenge Troy Buswell has now that he’s the State Treasurer. GEOFF HUTCHISON Now we listen to you and we listen to Troy Buswell and we listen to the Premier talk about these cuts and we hear phrases like ‘efficiency gains’. No one can tell us where these efficiency gains would come from, no one can probably tell us what the definition of an efficiency gain is. It’s a very blunt phrase. What’s your understanding of it? BEN WYATT Look it is. I mean an efficiency gain is obviously the term that’s just simply applied to reducing the base of recurrent spending, and that is what it … the purpose of it. It was to reduce it by three percent in a one off gain, that would then obviously … be replicated in the … well, the benefits of that will come in the forward estimates. The … the efficiencies will obviously be in government departments having to either … deliver a service more efficiently or in the case of frontline services, cut back. GEOFF HUTCHISON

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You’re listening to Ben Wyatt, who is the shadow treasurer. Do you believe the Government can implement three percent of cuts across the board and not impact on services to you? And how will that show itself—will it be fewer frontline police, will it be longer waiting times in hospitals? The Government can give no guarantee and it says these cuts have to be made. Let me know what you think. Ben Wyatt, it does raise an interesting question—do these cuts have to be made? BEN WYATT Well, that’s something that I’m … I’m looking forward to finding out … in a briefing I’m having later today with Treasury. It’s … Troy Buswell’s been indicating that the … in the forward estimates to … the surplus is declining. That’s not new news, we’ve known that for quite a period of time now with … the Commonwealth Grants Commission takes money off the State, four years from now our surplus is projected to decline to about $200million. Now there has been obviously extreme global turbulence, I’m looking forward to finding out today what impact that’s going to have on the State’s bottom-line but Troy committed to maintaining the growth in recurrent spending in his pre-election financial commitments. He’s been elected and now he’s going back on everything that he committed to … prior to the election date. As I said, there is obviously a little confusion there about whether the former government was prepared for the three per cent efficiency dividend. I genuinely want to know whether the former government carried out any forensic examination to see whether this efficiency dividend could be achieved. Quite frankly, it is evident from the comments of the shadow Treasurer that that was not the case, yet the idea did go to Treasury and it did go to cabinet. That is my first point: I believe that, much like with the Balga Works motion yesterday, this motion is nothing more than a political stunt. We do not need this select committee. We have to let the government do the job that it is meant to do. We were elected to govern the state of Western Australia, and that is our role. It is the role of the popularly elected government of Western Australia to govern, not to have the heads of the government departments hauled to a select committee to explain how they can cut three per cent from their budgets. That is the role of government. As I said, if we were to support this motion and do exactly what it asks, we would be usurping the fundamental basis upon which our political system exists. That is why the comments of Hon George Cash are so pertinent. One of the great political theorists in history, particularly Liberal democratic history, was Baron Montesquieu. He established the concept of the separation of powers, of having three separate entities of government—the legislative, the judiciary and the executive. Each of those three areas needs to be independent of the others, yet they need to be interdependent; one should not control another. As soon as one starts controlling the other, which is exactly the path we are going down with this motion, we suffer the very serious possibility of compromising the true separation of powers. I did a bit of research on the separation of powers just to refresh my memory on its establishment throughout the modern world. I will draw a couple of comments from Graham Spindler’s article “The separation of powers: doctrine and practice”. It states — DEFINING THE DOCTRINE The doctrine of the separation of powers divides the institutions of government into three branches: legislative, executive and judicial: the legislature makes the laws; the executive put the laws into operation; and the judiciary interprets the laws. The powers and functions of each are separate and carried out by separate personnel. No single agency is able to exercise complete authority, each being interdependent on the other. Power thus divided should prevent absolutism (as in monarchies or dictatorships where all branches are concentrated in a single authority) or corruption arising from the opportunities that unchecked power offers. The doctrine can be extended to enable the three branches to act as checks and balances on each other. Each branch’s independence helps keep the others from exceeding their power, thus ensuring the rule of law and protecting individual rights. I will come back to all this in a moment. It continues — Obviously under the Westminster System—the parliamentary system of government Australia adopted and adapted from England—this separation does not fully exist. Certainly in Australia the three branches exist: legislature in the form of parliaments; executive in the form of the ministers and the government departments and agencies they are responsible for; and the judiciary or the judges and courts. However, since the ministry (executive) is drawn from and responsible to the parliament (legislature) there is a great deal of interconnection in both personnel and actions. The separation of the judiciary is more distinct.

[9] Extract from Hansard [COUNCIL - Wednesday, 3 December 2008] p793b-802a Hon Ray Halligan; Hon Peter Collier

That is why the Australian system is affectionately referred to by a lot of political theorists as the “Washminster” system, because it is the combination of the American system, or the Washington system, and the Westminster system. We do have the three levels, but the dispersal of power of authority between the three levels is not clearly as distinct in Australia or the British system, the Westminster system, as it is in the American system. It goes on. I will not go through The Spirit of Laws, through which Montesquieu established that whole notion of the separation of powers. I will quote this aspect of Graham Spindler’s article from the Australian perspective — The Australian Constitution begins with separate chapters each for the Parliament, Executive and Judiciary, but this does not constitute a separation of powers in itself. Executive power was nominally allocated to the Monarch, or her representative the Governor-General (Section 61), while allocating it in practice to the Ministry by requiring the Governor-General to act on the Government’s advice (subject, of course to the Governor-General’s controversial ‘reserve powers’). This was the Westminster model and it relied on convention as much as the words of the Constitution. However, the specific requirement for Ministers of State to sit in Parliament (Section 64) clearly established the connection between Executive and Parliament and effectively prevented any American-style separate executive. Debate interrupted, pursuant to standing orders. [Continued on page 810.]

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