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When less is more for government

GOVERNMENTS around the globe have, almost without exception, felt compelled to try and take charge of their economies to tackle the recent financial crisis.

This has translated into dramatically increased government spending and a bigger role for government.

Prime Minister Kevin Rudd has been leading the charge, putting his government front and centre in Australia's response.

At one level, it is entirely appropriate for governments to try and bring some calm to the business sector, especially after the dramatic collapse of confidence last September.

But it is also appropriate to challenge just how deeply government tentacles run in the Australian economy, and to ask whether the current approach could be improved upon.

And when we look for ways to boost the country's economic prospects, instead of asking what government should start doing, we should ask what government should stop doing.

This question applies to all levels of government - national, state and local.

This week's cover feature provides a prime example.

It features leaders from the residential property industry who assembled at a WA Business News boardroom forum.

They spoke with one voice when expressing their frustration with government regulation and controls.

Nobody was suggesting changes that would lower the quality of regulation; instead they want to see a smarter system.

Nor was anybody suggesting radical changes that were untried in other jurisdictions; instead they drew on experience from other states to inform the discussion.

Their proposals focused primarily on the role of local councils, and more specifically the activities of elected councilors, who in most cases do not have the skills, experience or resources to properly discharge the role they have taken on.

This is not to disparage the intent of elected councilors. Rather, it acknowledges the deep-seated structural flaws in a system that leaves critical planning decisions in the hands of individuals whose re-election is usually determined by the votes of a handful of vocal community activists.

Elected councilors should set broad strategy; they should not make decisions on detailed planning applications.

Expert panels should be assembled to provide advice and/or make decisions.

If they do not make decisions within a specified time frame, the proposal should be deemed approved.

ABN Group managing director Dale Alcock, one of the state's most successful and astute business leaders, hit the nail on the head when he outlined the potential upside.

"You've actually got a whole stimulus package in itself in unlocking the shire approval process," he said.

Similar principles should apply at a state level, when dealing with approvals for major projects.

Premier Colin Barnett is an energetic advocate for development of the state but there are limits on how much one person can achieve.

Structural reform of the approvals process is high on the state government's agenda, and is the area where major, lasting progress can be achieved.

The goal is simple: lay out a clear set of guidelines that apply to projects and then give project proponents an opportunity to meet those rules.

In pursuit of the principle of governments stepping away from activities where they don't add value, there are two other reforms that should be placed at the top of the state government's agenda: retail trading and liquor licensing.

Anybody who has lived in another state or country can't help but be frustrated by the continuation of arcane regulations in Western Australia, that stop business people trading when it suits them and stops consumers shopping when it suits them.

Liquor licensing is another area that has improved immeasurably but could be a lot better; once again, the problem often lies with state and local councils failing to see as one.

At a federal level, one of the most profound changes has been the rollback of industrial relations reforms.

The Rudd government has taken advantage of community disquiet about the WorkChoices and in the process has introduced changes that take control away from individuals.

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