SA election: what’s in store for the public sector

By Stephen Easton

Monday March 19, 2018

The Liberal Party’s win in the South Australian election will bring a fresh drive towards “innovation and collaboration” in the public service and an end to political interference — or at least that is what it promised.

“The public service is one of our State’s greatest assets, able to drive change in South Australia when given the freedom and respect it needs to unleash its potential,” says a list of beliefs in the conservative party’s policy manifesto that was released before the poll.

“The public service should be free from political interference, with a premium placed on frank and fearless advice, with jobs won on merit, not as rewards for political loyalty.

“The public service can be a place of innovation, where people are encouraged and supported to come up with creative solutions to the challenges facing South Australia.”

These fine sentiments are similar to those espoused by all governments if they comment on the role of the public service. Following statements of belief focus on the importance of efficiency, avoiding waste, and imposing lower costs on residents and businesses.

SA’s new government, led by Premier Steven Marshall, went into the election planning for “11 traditional portfolio areas including premier, treasury, education, health and transport” as well as “three specialist ministers who will manage the critical portfolios of Child Protection, Energy and Mining, and Trade and Investment”, with each department only reporting to one minister.

It will also copy Tony Abbott’s move to put Indigenous affairs into the premier’s department and it wants to establish at least two new major statutory bodies: a state Productivity Commission and Infrastructure South Australia.

The new PC will play a major role in reducing the size and cost of running the state public service, which employs more than 12% of the state’s workforce.

The policy document says the new government wants to give the public service “a new future so that it is doing what we really need in efficient and innovative ways which keep our taxes and other costs down” while giving public sector workers jobs that are satisfying and offer career progression.

Prompt payments, or else

SA’s new government has promised a crackdown on government agencies paying their bills late. If they do in future, they will have to pay an extra penalty to the creditor.

“Businesses continually complain about the late payment of bills by South Australian Government departments,” the policy statement reads.

“Prompt payment is vital for small- and medium-sized enterprises in particular, although there is no excuse for government departments not to pay invoices submitted by all businesses on time.”

The Liberal policy cited a statement from the Small Business and Family Enterprise Ombudsman’s office last June, that $470 million worth of invoices to SA agencies had been unpaid for longer than 30 days at the time.

“While penalty interest is payable by government agencies for late payments, many businesses consider the amount so small and the bureaucratic procedures applied to seeking it so cumbersome that the effort just isn’t worthwhile,” said the party which has now formed government.

In future “automatic penalties” will apply if that penalty interest exceeds $10, on contracts worth up to $1 million where a “correctly rendered” invoice has been outstanding for more than 60 days. Cabinet ministers will also have to report on their department’s bill-paying performance every month.

Parochial procurement

The new government not only promises to pay more of its procurement bills on time, it also campaigned on directing more of roughly $4 billion in total spending to suppliers based inside the state’s borders.

Marshall’s policy says this will not come before the need for purchases to be fit for purpose, value for money and legally compliant, before setting out five areas for reform.

The plan includes breaking down aggregated contracts into several smaller ones to give smaller local suppliers a chance to compete, and introducing a rule that one local supplier must be included in every tender process, unless one can’t be found, in which case this space in the market will be reported.

Other suggested changes are a quicker online registration process for submitting tenders, a new government unit to help smaller businesses prepare their submissions, and a review of which agencies are prescribed authorities that are not subject to all of the normal procurement rules.

Any entity wishing to retain its status as a prescribed public authority will need to demonstrate why it is in the public interest to do so,” according to the pre-election statement.

The Marshall team also campaigned on increasing oversight of major public-private partnerships, promising to refer each one to a parliamentary committee in future.

Advertising anxiety

The Liberals accused the Weatherill government of spending taxpayers’ money on “political advertising” after it spruiked government programs — a state energy plan, a hospital opening and a jobs program — on radio, television and in print during the campaign, using the former premier’s face and voice.

They claimed this went beyond legitimate communications of “basic facts the public needs about the availability of government services” and promised to ban the practice:

Specifically we will ensure that:

  • government advertising is deemed political expenditure when it mentions the name, displays the image or uses the voice of a person who is a Member of Parliament
  • any misuse of taxpayers’ funds for political advertising will be included under the Electoral Spending Cap, which regulates spending by political parties for election campaign purposes.

The electoral commissioner will have a new role to investigate spending on ads from departmental budgets.

Reining in rates

In a move that has affronted the SA Local Government Association, the Marshall government plans to introduce rate-capping, a policy opposed by all other parties. To soften the blow, it also promised to stop shifting costs onto local councils.

The new government has argued that rates have increased more rapidly than inflation in SA, in some cases by three times as much as the consumer price index.

It plans to establish an independent regulator to determine how much councils can charge, based on the local government price index, which is typically slightly higher than the CPI.

Individual councils will be able to apply for a rate increase above the cap, but only if ratepayers agree.

Higher rates could be approved for areas with significant industry and population growth, to pay for “projects of regional significance” or even for ordinary purposes like “the maintenance or development of essential community infrastructure, including any backlogs” and “enhanced or new services to meet growing community demand”.

Top photo via Steven Marshall’s Twitter account: being sworn in as premier, standing next to his new public service right hand, Dr Don Russell, head  of the Department of Premier and Cabinet. 

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