November 2008

The Nation Reviewed

Following Menzies

By John Hirst
Illustration by Jeff Fisher.
Illustration by Jeff Fisher.

What should the Liberal Party do when Labor governments favour private enterprise, contracting out and selling off? Join in, of course. In August, Barry O'Farrell, the leader of the New South Wales Liberals, refused to join in when Morris Iemma's Labor government tried to privatise the state's electricity generators. The government's privatisation plan had been overwhelmingly rejected at its party conference and a number of Labor parliamentarians were preparing to vote against it. The government would need votes from the Liberal Party to carry the measure through parliament. Under O'Farrell, the Liberals declined to support the premier, which forced Iemma to abandon his measure. The Labor Party machine turned against its premier, who resigned, along with several of his ministers. The Labor machine then installed a new premier and told him who his ministers would be.

O'Farrell had earlier said he would support electricity privatisation if the auditor-general approved the government's plans. The auditor-general did approve, but the temptation to drive the Labor government into chaos over the issue proved too much. But it was not altogether spurious for O'Farrell to argue that this incompetent government should not be trusted to sell or lease assets and invest the proceeds wisely, and that that now was not the time to privatise an industry reliant on coal while the nature of the emissions-trading regime was undecided.

Both Sydney's daily papers were for privatisation and they kept telling O'Farrell that business wanted him to support it. When O'Farrell met leaders of the business community, he handed them copies of Menzies' ‘Forgotten People' speech of 1942. He was underlining Menzies' message: the Liberals do not exist to do the bidding of big business, which can look after itself; the party represents a wide range of ordinary people who otherwise do not have much influence.

When I read of this encounter I became interested in Barry O'Farrell. I had already received indirectly an invitation to meet him because he had read some of my books. If in what follows there is too favourable a view of O'Farrell, I must be excused: this man is one of my readers.

History is important to him. He majored in it at the ANU, concentrating on Australian history, which had not been available at his school, though he avoided Australian military history because his father and older brother were in the army. But that minor rebellion has passed and recently he has been reading about Australian soldiers at Gallipoli and on the Western Front, and about Monash, whom he greatly admires. He has walked the Kokoda Track.

He became Liberal leader early last year, after the party's fourth consecutive electoral defeat. At that election both the Labor government and the Liberal opposition were against the privatisation of electricity. It says something about our politics that the hardhead economists and commentators, who all claimed there was no alternative but to privatise, did not regard the pledges of both parties not to do so as any impediment. When the Labor Party rolled the premier on this issue at its conference, we were told that the party machine was interfering with the democratically elected government. But all the party was asking was that the elected government stay true to the promises it had made to the people.

The Liberal and National parties are now committed to encouraging private-sector involvement in the electricity business. That does not mean selling off the generators, O'Farrell says, but it does not rule it out. Nearly all the generation is currently done by government-owned companies but there is a small private component that could be expanded, though government generation has to be operated on commercial lines before private companies will risk starting up in competition with it. Distribution may be treated differently from generation. The next election is not until 2011 and the party will not commit itself to details before then, when emissions trading will be in place and the possibilities of renewables better known. Some sort of hybrid is the most likely outcome, which would mirror the diversity of views on this issue within the Liberal-National Coalition. O'Farrell concedes that the polls show most people are opposed to privatisation. He might face a difficult election if the Labor government is still opposed to privatisation - as seems likely, given that its premier was installed by the unions - but not so difficult if the government has not managed to develop plans for increasing generating capacity without relying on private investment. O'Farrell thinks he can persuade people that purity in this matter has long gone; there is a national electricity market with a mix of private and public power stations competing with each other across five states. Already some people in New South Wales are getting privately generated electricity from private distributors.

O'Farrell is not a reflex small-government man. Again he cites Menzies in support: "Dogma is a comfortable thing. It saves thought." He is a pragmatist guided by the principles of "competition and choice", which he repeats as a kind of mantra. As an old social democrat, I still bristle at these terms, thinking of them as a cover for reducing government services to the disadvantage of those who need them most. O'Farrell helps me with an account of how the Liberal premier Nick Greiner handled the introduction of toll roads, built and operated by a private company. The premier insisted that there remain a free alternative route and that traffic not be funnelled onto the tollway. By contrast, the Labor government, in return for more payment up-front from private companies, has closed roads, funnelled traffic into tunnels and made it as difficult as possible to find free routes. So much for social democracy, New South Wales style! The only time O'Farrell has warmed to four-wheel drives was when their drivers bumped over barriers to reclaim freedom of the road.

However, "competition and choice" is not what O'Farrell reaches for when we discuss schools. Parents must be free to choose private schools, but he wants parents to be confident that public schools can be the first choice for their children. He has a son in one and thinks many parents are spending money needlessly on private schools that are no better than public. This emphasis is at odds not only with the approach of the former federal government, which did so much to expand private schooling under the banner of choice, but also with that of the present minister of education in Canberra, who invites us to get over any concern about the relative strengths of private and public schooling. But O'Farrell, unlike the New South Wales government, is happy with Julia Gillard's plan to assess and rank schools, so long as these league tables are conducted along the lines of the AFL: low-ranking schools must get the first draft pick. His willingness to assess and rank comes with this caveat: he knows that some teachers do a great job in merely getting children to come to school.

I have no success in eliciting from O'Farrell any support for my conservative tendencies in social policy. He is completely at ease in the modern world, which may be explained by his geniality, or the ordinary politician's habit of not quarrelling with his electorate, or simply that he grew up during the social revolution of the '60s and '70s. When I refer to the church, he replies with "church, temple and mosque". He is delighted with his candidates for three by-elections made necessary by the implosion of the Iemma government: a third-generation Italian, a moderate Muslim (in Lakemba) and a Vietnamese refugee. O'Farrell thinks most Australians do not judge according to race, gender or sexuality; they judge by who you are and what you do, which he sees as the beauty of the fair go. He draws the line only at same-sex marriage. Whereas the common sense about overcoming welfare dependency is that it requires a carrot-and-stick approach, O'Farrell is unhappy with stick - in his formulation, rewards are more effective than penalties. When I suggest that the underclass is not easily stirred from its torpor, he replies that some people do need help to "recalibrate their lives" but better that the help comes from private agencies than from government, which is too bureaucratic and too politically correct. He is very impressed by a program run by the Uniting Church in Sydney to revitalise mothers and fathers on the margins. I can believe that the Uniting Church might be free of bureaucracy but not of political correctness - is it not the Greens and Democrats at prayer?

He plans to avoid altogether an auction on law and order at the next election. He thinks he can't beat Labor at this game and genuinely does not want to play it: he rolls his eyes at what Liberals have promised at previous elections - T-shirts with shaming messages and minimum mandatory sentences. His instruction to his shadow ministers in law-and-order portfolios is that they should plan to get the present system working well, not to reach for eye-catching alterations. Last year the Liberals in the upper house, voting with an unlikely coalition of Greens, Shooters Party and Christian Democrats, refused to give the Labor government the power to bug without judicial surveillance for five days, forcing it back to two days - and won a commendatory opinion piece in the Sydney Morning Herald from David Marr.

O'Farrell's trusting, generous spirit may have its origins in his religion, or the religion may have firmed it into a principle. He is a Catholic; not a good Catholic, he insists, but a believer. He is guided by "the universal message of Christ on how to treat people". He can't be a good Catholic because he picks and chooses among Catholic doctrines, which Cardinal Pell will not allow. He defied the cardinal and voted for stem-cell research. He sees the cardinal regularly, respects his intellect and enjoys his sense of humour.

O'Farrell has best demonstrated that he has the mettle and the authority to be premier through his reform of the party. When he became leader, the moderates and the right wing, led by the Catholic crusader David Clarke, would not speak to each other. The only story in the media about the Liberals was their savage in-fighting, which stymied any chance of presenting themselves as an alternative government. O'Farrell, never a member of either faction, got the parliamentarians to talk by yoking them together in committee and policy work. The more difficult task of uniting the organisation had been initiated by the party president. When his plans did not look like succeeding, O'Farrell took charge himself; this was his "crash through or crash" moment. A failure would have destroyed him, but he has had a success that is good enough, getting substantial changes to the party's practices, though losing by resignation the president and some of his allies. Elections within the party will be by preferential voting so that the winner does not take all, and branch stacking has been made more difficult. In all this work, O'Farrell's aim has been to manage differences by the cultivation of civility, which is natural in him.

When he was deputy leader, O'Farrell was plagued in the usual way by journalists wanting declarations of loyalty to the incumbent. He answered jokingly that when he shaved his beard and lost weight, they would know he was challenging. When he shaved his beard because his younger son did not like the feel of it, his comment was remembered and taken seriously. That taught him that jokes were impossible in politics. He is now losing weight and keeping fit. He does seriously want the top job.

John Hirst

John Hirst is a historian, social commentator and emiritus scholar in the history program at La Trobe University. His books include The Australians: Insiders and outsiders on the national character since 1770, Freedom on the Fatal Shore: Australia’s first colony and The Shortest History of Europe.

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