12/06/2007 - 22:00

Finding better ways to spend our money

12/06/2007 - 22:00

Bookmark

Save articles for future reference.

You should always be careful what you say when there are people present who know more than you do.

You should always be careful what you say when there are people present who know more than you do.

That might be an obvious maxim – especially for someone like me – but every now and then it pays to remind yourself before circumstances do it for you.

An example might be when you get asked to speak at a function after the treasurer and under-secretary to the Treasury Department, and you take them to task over the increase in recurrent spending, which had jumped up to more than 10 per cent in the current budget.

That might be fine, but you ought to be careful about wielding facts and statistics around without having the latest data to hand.

Sure, I said, last year we saw 14 per cent growth briefly, but that double-digit stuff is unlikely to last.

Of course it has lasted, with the Australian Bureau of Statistics revealing that, in the year to March, Western Australia’s growth was 10.2 per cent.

That trend is downwards, of course, but it’s still mighty strong – and most of us living here would be hard pressed to see it falling too rapidly in the final quarter of the current financial year.

Still, I’d like to think the point I was making still resonates.

Growing government operational expenditure by 10 per cent is a concern, even though the growth we have is generating new demand for state services. The problem is the growth will fade away eventually but the spending won’t.

The challenge for any government rolling in money is to find reasons why it should cut spending or, indeed, do anything to stimulate more economic activity. But that is the most opportune time.

Rather than saddling us with ongoing spending, it’s time to find ways to reduce services where they are not needed. Labor might find that even some moderate privatisation is appropriate.

I have previously mentioned the rather small issue of outsourcing some of the Transport Department’s vehicle inspections to the private sector to alleviate bottlenecks.

This was long overdue, and a good example of government finally giving up something the private sector can do better.

Naturally, this doesn’t really reduce the burden on taxpayers, because they still have to pay for vehicle inspections, but it is one way to reduce the cost of government and, at the very least, creates some opportunities for those in the private sector.

Hopefully, a bit of competition will keep the price down too.

You could take this argument all the way to education, but that is getting to an area too sensitive for many. Instead, though, there are many smaller services that simply don’t need to be run by the government.

If government learns to discard the unnecessary, especially the services whose use-by-date has arrived, it can then concentrate its efforts (and taxpayers’ dollars) on the things that matter, both new and old.

 

Woodside Petroleum – a quiet achiever

For all its star attraction as Western Australia’s biggest company, Woodside Petroleum Ltd seems to me to get very little attention.

As the major local player in the biggest game in town, analysis seems to be either detailed beyond belief or cursory – perhaps because it is a minnow in the global oil industry or maybe because it is located away from the easy gaze of the national press.

Whatever the reason, it seemed timely for us to take a very close look at what this $30 billion company was doing in our own backyard.

Woodside is at the crossroads of its development and the next few weeks may be critical to which direction it takes.

 

That's business

I know many will bemoan the loss of Multiplex Group and the consumption of yet another Australian icon by a foreign company.

But in business there is the law of jungle – only the fittest survive. Multiplex tried to take on the world and failed, its reputation crippled by the problems at Wembley in the UK.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

Subscription Options