billrider2013

 

I had decided to take the ferry from Bagan to Mandalay on the advice from the travel agent in Yangon.

Early start

The Ferry was due to leave at 6.00 a.m. with a boarding time of 5.30 a.m. That mean an early rise. I booked a taxi the day before. It was still dark when we arrived at the jetty.

Calling the place where you board the ferry a ‘jetty’, is a bit of a loose use of the term. It is actually a blank of wood leading to a boat that appears to permanent moored at that spot. You clamber across that boat on to your ferry that is tied to the moored boat.

The blank is not to wide and it was at quite a steep angle. There were lots of blokes offering carry my bag up the blank. I knew that that would involve some sort of fee. I decided to carry the bag myself. After a month in India, I was so over being asked to pay for ‘services’ like this, irrespective of the cost.

An Australian not keen to Tip

When I got on board the ferry there was a heated discussion going on between one of the porters and an Australian bloke. Clearly the porter had carried the blokes bag on to the ferry and wanted to be paid. The Australian bloke was having none of that: “I’m not paid you to carry my bag for 20 fu$cking seconds, it should be part of the service”. Another character, obviously one of the ferry’s crew said that the “porters were not part of the ferry”. The Australia bloke said “good, he can get off now and I won’t have to see him again”. One of the Australia blokes mate said, “that’s a bit harsh, he did carry your bag”. The response was, “I’m not paying, that’s it, and if you don’t like it you fu&king pay him”. He wasn’t a happy chappie.

Reading Laura Tingle’s Quarterly Essay

A couple of days before the ferry trip, I had ordered, the latest Quarterly Essay using my Kindle. The essay, ‘Political Amnesia’ was written by Laura Tingle, the Political Correspondent for the Australian Financial Review. The essay was delivered to my device in time for the long ride up the Irrawaddy.

The general proposition of the essay is that the various institutions in Australia politics have lost their memory and cannot learn from the past because they simply don’t remember or know what happened in the past. Clearly she if the view that this was no always the case.

I agree with virtually all of what Laura Tingle has written, and it is consistent with my (albeit relatively limited experience) observing Australian politics. I also found it interesting that many of the points the she made in the essay are the same or similar to issues discussed in recent book on the British Establishment by a bloke called Owen Jones. I was alerted to this book by one of my English relatives and read it when I was in India.

Decline in the role of the Public Service for Policy Advice

One the issues that Tingle highlights is the decline in the role of the Public Service in both the provision of policy advice and the actual delivery of services. She details and number reasons why this has occurred.

She goes back into the past to describe a period when the Public Service had considerable influence. This was the era of the Permanent Heads including the ‘Seven Dwarfs – Nugget Coombs, John Crawford, and Roland Wilson. You could add Fred Wheeler, the long term Treasury Permanent Head and Arthur Tang the head of Defence to that list.

These blokes were at the peak of their power in the Menzies era. They highly capable people who were in the Public Service virtually all their careers and had risen through the ranks of their respective Department’s to become Permanent Heads. The title meant what I said: they were ‘Permanent’ until they decided to retire.

I first became truly aware of these characters when I studied politics from 1974. Their role often came up in the course material. I also heard then being spoken of by my neighbours when I was growing up in Canberra. One often talked about “brother Jack [Crawford]”. Another who was a member of the Commonwealth Club, often spoke about the “real rulers of the country meeting, and deciding the course of history at the Club”.

It was generally thought that upper echelons of the Public Service in period of the Menzies and later Liberal/Country Party governments, were Liberal Party supports. Clearly this was true of people like Tang and John Stone. Stone was actually more to the right and became a Nation Party Senator.

When Gough Whitlam came into power, he removed the ‘Permanent Head’ status and brought in a number people from the outside to head Departments in 1973 on.

Tingle also notes that Whitlam also introduced ‘Ministerial Advisors’ as an alternative source of advice to that being provided by the Public Service. She notes that in subsequent years, the Ministerial Offices have come to be the dominant source of policy advice in most portfolios. The exceptions maybe Treasury, Foreign Affairs and Defence.

Decline in the Resources of the Public Service and its Capacity to Deliver
One of the issues that Tingle discussed is the decline in the resources being provided to the Public Service and the decline in its ability to deliver, not only policy advice, but basic services.

She points out that this is this primarily related to the view that government is essentially inefficient and should leave functions to be performed by the private sector. There has also been a strong push, principally by the Liberal and National governments to move functions from the Public Service into the Private Sector. This has ranged from outsourcing basic functions such as payroll and accounts payable to private firms, the use of outside computer services e.g. instances of SAP, through to privatisation (e.g. Medibank Private).

It has also involved that use of the ‘efficiency dividend’ to slowly but inexorably reduce the numbers of public servants, such that Departments have been left with such low numbers and skills that they have to rely on outside consultants to be able to function.

I have had personal experience of this in the Commonwealth Public Service, the NSW Public Service and as a provider of consulting services to these Public Services and the Victorian Public Service. I also have a number of friends with similar or related experiences.

Consulting Firms Cash In

The book, ‘The Establishment’ deals extensively with this issue in the context of the UK. Particularly under Cameron. He points out that the big consulting companies such as Price Waterhouse Coopers, Ernst and Young and Accenture are making a fortune providing services to government. In many respects the UK government has become almost totally dependent on these firms.

In Australia, the most dramatic increase in the use of consulting firms took place under the Howard Government from 1996. Howard drastically reduced the size of the Public Service. Thousands of Public Servants were made redundant and services were outsourced. Many ex-public servants joined the consulting firms. One of my pre-school mates formed a consulting and accounting service firm with a couple of colleagues from Ernst and Young. It was an immediate success. I recall him saying that “it was like taking candy from a baby. The Department simply do not have the staff to do the work and they rely on us to do the work”.

I had experience working for a competitor to his firm in the early 2000’s. This firm was also very successful. I had a number of dealings with staff based in the Canberra office. I quickly found that the firm was not a ‘consulting’ firm in same way as say Booz Allen or McKinsey. I had dealings with these firms when working with Caltex and TNT. Whatever you may say about these firms, they are a real consulting firms with methodologies and skill sets that they develop. They train their staff in the use of these mythologies and skills. What struck me about that Canberra firm was that it was more of ‘labour hire firm’, providing staff to government Departments as opposed to delivering consulting services using mythologies provided by the firm. Most of the ‘consultants’ were ex-public servants. Their charge out rates were at least 3 times the cost of salaried public servants.

It is interesting to noted that both my mate’s firm and the competitor firm that I worked for were ultimately sold the ‘big end of town’ firms. The profits of the firm now primarily go to the partners in Sydney. I guess this is good for Private Schools and Mercedes dealers.
I noted that the Abbott Government repeated that Howard attack on the Public Service. One of the results has been another boom for the consulting companies.

Government Does Nothing Useful

There is a belief held by the neo conservatives that the government does nothing useful. This is belief is discussed at length in Owen’s book and Tingle notes its existence in Australia. It is a belief that is widely held in the USA.

The politicians that hold his view use it as an argument to attack the Public Service and have services provided by the Private Sector. There are obvious examples where the need for government to own businesses is not necessary. An example that comes to minds car fleet management.

There is plenty of competition that that industry and government can simple buy those services.

However, there are more examples where it is questionable whether government is a bad thing. I am not certain the sale of the Commonwealth Bank resulted in a net benefit to the users of banking services.

Well Actually It Does

There are other examples where government ownership and operation of the provision of service is of benefit. These include cases where there is a natural monopoly or where single provider is the most efficient and effective option. An example of this is the provision of universal health insurance.

The Whitlam Government introduced the original Medibank which was later changed to Medicare. recall auditing the Health Insurance Commission (HIC) in the early 1980’s. The HIC built and operated the Medibank Health Insurance system. It is generally recognised that they did an excellent job.

Another example where government involvement is not only preferable, but it essential, is where the market and the private sector simply cannot provide the services required. This often occurs where the return on investment is too low to interest the private sector. An example of this is essential infrastructure such as rail. Investment in rail lines rarely passes the Return on Investment (ROI) test that would justify private sector investment. If it does, this is mostly due to overly optimist assumptions on patronage.

The rail link to the Sydney Airport is a classic example. In 2000, the Airport Link Company was placed in receivership after defaulting on its finance arrangements with patronage figures were only one quarter of that forecast. It is now profitable, but the prices charged exploit it monopoly position. The prices are absurdly high.

The problem with the conventional ROI calculations is that the benefits taken into accounts are typically too narrow. For example, they don’t take into account issues such as the saving related to reduced (or avoided) road congestion related to the use of the rail line. There are also the benefits that accrue to the airport in making it a more desire destination as a result of the quicker link into the city. The rail operator does not get the benefit of the addition revenue, that goes to the airport owner.

These issues don’t arise when the government owns that assets and has an interest in improving the welfare of the community as a whole. A good example is Singapore and the its Changi Airport. Individual ls investment in the airport, the MRT rail link to the airport and the links to the other parts of the city, would not pass the traditional ROI test. However, together, they have made Changi Airport an essential component in establishing Singapore as transport hub. This has a major knock on effect on making Singapore a financial centre. The can said of the rail links to all major airports such as Kuala Lumpur, London Heathrow, Hong Kong, Bangkok etc.

Definitely Worth a Read (particularly if you are on the Loony Right)
Both Laura Tingles essay and the Jones books are worth a read. They are examples of a relational analysis of contemporary politics in Australia and the UK. They are the works of people trying to promote left wing philosophies or a left wing agenda. Naturally they include a lot of opinion that can be challenged. However, it all looks sensible to me.

I am reminded of a comment that my Balmain host often makes. He makes that observation that he is constantly amazed how little the people with right wing views actually know. A recent example he cites is that ‘debate’ over the budget deficit. When he challenges people how think that we have a ‘budget crisis’ to explain why it is okay for them to have a mortgage on their house, but is not alright for the government to borrow to build and hospital are a school, have can’t answer that question.

It is doubtful that any member of the ill-informed loony right will ever read the essay or the book. That is a shame.

The Ava Bridge

As we approach Mandalay, we passed under the Ava Bridge. It was built in 1934 by the British. They destroyed it in the face of the advancing Japanese in world war two.

It was rebuilt in 1954. It is a very impress bridge.

Arriving in Mandalay

We arrived in Mandalay late in the evening. We were greeted by a crowd of blokes offering to carry our bag down the blank to the river bank.

The Australian bloke who had issues with this ‘service’ in Bagan was prepared. He told them all the “fu@k off”.
I carried by bag down the plank. I ended up sharing a taxi into town with a

Turkish American bloke. He was a serious good negotiator. I am sure we paid a fair fare.

I checked into my hotel, The Queen, and was pleased to fund it was comfortable and clean.

 

Flickr Irrawaddy

https://flic.kr/s/aHskpaXfzY

Garmin

https://connect.garmin.com/modern/activity/970721595

Wikipedia Irrawaddy

https://en.wikipedia.org/wiki/Irrawaddy_River

Laura Tingle’s Quarterly Essay

https://www.quarterlyessay.com/essay/2015/12/political-amnesia

The Establishment by Owen Jones

https://www.penguin.com.au/products/9780141974996/establishment-and-how-they-get-away-it