Blowing in the Wind – Illustrating How Governments Invent Red Tape

LinkedIn Post: 20 June, 2015

The announcement this week that a national wind farm commissioner has been proposed by government to address complaints about the operation of wind farms on the basis that an appointed commissioner will “hear complaints and refer them to relevant state authorities” is a classic demonstration of how governments can conceive and introduce ‘bad’ regulatory procedures. And all of this at a time that the Coalition Government has been advocating since its election about the need to remove duplicative State and Federal Government environmental regulations that impact on major infrastructure development.

Appointing a Commissioner is one thing, but has anyone thought through the implications of introducing a further regulatory procedure in the environmental assessment process? Will the Commissioner’s findings impact on a development application prior to a development determination or will it become a ‘show stopper’ after development consent is received or even after the construction of a wind farm is completed? Will the Commissioner’s findings be subject to judicial appeal? Will the Commissioner be empowered to require additional and scientific studies? Who knows, except we can be sure that the regulatory process for wind farm development will be extended in time, become more complicated, and inevitably incur additional projects costs, and add to investment uncertainty.

Now the precedent is on the table for proposed implementation, no doubt that the mining and CSG industries will now be wondering whether this new concept will be forced upon them when community groups start agitating on specific environmental issues which are predicated on challenging scientific studies in support of infrastructure development.

In October last year, the Australian Government announced that “as part of the Industry Innovation and Competitiveness Agenda, the Government will examine opportunities for greater acceptance of international standards and risk assessments.This is an important part of the Government’s plan to cut red tape and foster a lower cost, business friendly environment with less regulation”.

“The Government will adopt a new principle that if a system, service or product has been approved under a trusted international standard or risk assessment, then our regulators should not impose any additional requirements for approval in Australia, unless it can be demonstrated that there is a good reason to do so. This will remove regulatory duplication, reduce costs and delays for businesses and consumers, increase the supply of products into the Australian market and allow regulatory authorities to focus on higher priorities”, the Government stated.

In addition, it is also noted that earlier this year, the National Health and Medical Research Council (NHMRC) concluded that “there is currently no consistent evidence that wind farms cause adverse health effects in humans. Given the limitations of the existing evidence and continuing concerns expressed by some members of the community, NHMRC considers that further high quality research on the possible health effects of wind farms is required.”

In these circumstances, surely the sensible  approach would be to allow the NHMRC to undertake whatever additional research that they believe may be necessary, without government preemptively introducing into the existing regulatory regime (where ‘it has not been demonstrated that there is a good reason to do so’) new procedures; an unwise move which would seem to be totally inconsistent with the tenets of the Government’s Industry Innovation and Competitiveness Agenda. 

Note: In the 1980s, the author chaired a coal industry/government working group which reviewed and streamlined all regulations required for coal mine development in NSW, which resulted in a major reduction in the time required by mining companies to obtain a coal lease.

Making Australia Great: Inside Our Longest Boom (Australian Manufacturing Forum, 18 March 2015)

Viewers of the ABC documentary screened last night would have been reminded of the state of the Australian economy (and the Australian manufacturing industry) prior to the floating of the Australian dollar in 1983 i.e. characterised by a fixed exchange rate, centralised wage fixing and a well developed tariff regime which, as was alleged, ensured that tariffs were set to match product prices – just enough to keep competing imports at bay! Complicit in this cartel were governments of all political persuasions, the union movement and the captains of industry. Industry associations were established and prospered to make sure that this cosy arrangement was never challenged!

How things have since changed with the Australian economy being progressively thrown open to global competition, with most of the Australian manufacturing capability replaced with imports, predominantly from advanced manufacturing economies, and increasingly from the Greater China Region. Former PM Paul keating made the oft quoted comment that Singapore’s first elected premier Lee Kuan Yew had told him that if Australia hadn’t changed, we were rapidly on the pathway to become the ‘white trash of Australia’. Lee Kuan Yew was of course a supreme strategist, and unlike Australia, he had a grand plan for Singapore. Former PM John Howard made the astute comment that despite the reforming plans of Labor leaders such as tariff slasher Whitlam and Hawke/Keating, Australia had no strategic plan in place to manage the transition to an open economy, and hence the rapid decline intensity of our manufacturing capability.

The episode next week will no doubt make the point that the burgeoning prosperity that Australia has experienced since 1983 can be attributed to the mining boom that has ‘delivered the goods’ What the episode next week will not reveal is that in 2006 the then Howard Government commissioned a House of Representatives Standing Committee on Economics, Finance and Public Administration Inquiry into “The state of Australia’s manufactured export and import competing base now and beyond the resources boom” Unfortunately, the Government seemed not to like what the Report had recommended and after tabling in the House, it was consigned to the dustbins of history!

Nearly 10 years later with the resources boom well and truly behind us, Australia still has no strategic plan for the future, just the promise of a number of lightly funded ‘growth centres’.

Prior to 1983, the strategic plan was simple – maintain the closed economy, but in an open economy, it is a quite different dynamic – to compete effectively, we need to be as smart or smarter that the many economies with which we compete. And if Australia completely opens its doors to the world through a myriad of FTAs and the proposed Trans Pacific Partnership arrangements, without a carefully structured strategic approach supported by governments, business and industry, we risk being overwhelmed by the forces of international competition. 

Lee Kuan Yew may well have had some good advice for Australians some 30 years ago. Since then, Singapore’s Economic Development Board has made an art form of strategic planning and has continued to prosper.

There is no time like the present to ‘kickstart’ this essential strategic planning process, even if the idealogically driven economists and the current batch of ‘industry captains’ prefer to defer to the vagaries of market driven economics. 

Comments are most welcome!

 Geotourism Speaking Opportunities Abound (20 March, 2015)

The Geotourism Forum of Ecotourism Australia and the Geotourism Standing Committee of the Geological Society of Australia have arranged two opportunities this year to raise awareness of geotourism through Ecotourism Australia’s Global Eco Conference in Perth (17-19 November) and at the 2015 SEGRA event in Bathurst, NSW in October (20-22 October).

Global Eco conference organisers have issued a call for papers which can be viewed at http://www.globaleco.com.au/Publications/2015/callforpapers-flyer.pdf

Topic areas include global geotourism, geoparks and geotrails, as well as highlighting ecotourism (and geotourism developments) in Australia’s National Landscapes. The Call for Papers close on 30 March.

A call for papers will issue shortly for the 2015 SEGRA event where the concept of geotrails is being featured as a major theme. Geotrails provide an alternative and attractive approach to nurturing regional development by celebrating geotourism, geological and mining heritage (of which the Modern Mining Trail of Central-West NSW and the Hill End Historic site located just north of Bathurst are outstanding local examples). Given Bathurst’s location, the Australian National Landscape – the Greater Blue Mountains including the Jenolan Karst Conservation Reserve, is on the agenda to be discussed. Pre and post conference tours with a strong geotourism focus are also currently being planned.

Delegates at SEGRA include senior officials of state and local governments, particularly regional development authorities. Highlighting geotourism at SEGRA raises awareness amongst decision makers of the opportunities offered by geotourism in nurturing regional development and new employment creation.