Andrew Leigh

E&OE TRANSCRIPT
RADIO INTERVIEW
2CC CANBERRA DRIVE WITH LEON DELANEY
WEDNESDAY, 11 OCTOBER 2023

SUBJECTS: Australian Centre for Evaluation and the commencement of online employment service trials, Productivity Commission report on slowing productivity, allegations of bullying and sexism at the Productivity Commission, Rural Fire Service Association’s use of donations.

LEON DELANEY: Federal Member for Fenner, the seat in which this radio station is located also happens to be the Assistant Minister for Competition, Charities and Treasury, and Assistant Minister for Employment. He's also coincidentally on the telephone right now. Good afternoon Andrew.

ASSISTANT MINISTER FOR COMPETITION, CHARITIES, TREASURY AND EMPLOYMENT ANDREW LEIGH: Good afternoon, Leon, great to be with you.

DELANEY: Always good to have you on the program. Thanks for joining us today. You're on about your favourite pet project at the moment, aren't you, the Australian Centre for Evaluation, apparently it has passed a milestone? 

LEIGH: It has. Today the Australian Centre for Evaluation has entered into a partnership with the Department of Employment to do a series of randomised trials on employment services programs.

These are programs which use the online services system to assist people to find jobs. We need to make sure, Leon, that at a time with historically low unemployment that everybody is getting the work that they feel that they're ready to do. So this is about ensuring that government works better, it will save people money, and it will help some of the most vulnerable in the community.

DELANEY: Okay. So hopefully we'll find ways to help the employment sector, the employment assistance sector to work better?

LEIGH: Yes, that's right. So when we're testing new pharmaceuticals, we always use a careful control group. We're very scientific about how we analyse programs. It's less so in the case of social services, often things are done on gut feel and intuition. That can only take you so far.

DELANEY: Or even ideological predispositions, let's be honest.

LEIGH: Exactly, exactly, and you can point to examples from all sides of politics on that. This is aiming to bring sound science to policy making, ensuring that we're spending taxpayer money wisely. It's a proven methodology used in many other countries, and it's about refining programs and so they can be their absolute best.

DELANEY: You've given a speech today talking about the importance of flipping a coin. That's related somehow.

LEIGH: That's right, and so that's what you're doing in ‑‑

DELANEY: So, what, what's flipping a coin got to do with making an informed decision?

LEIGH: That's what you're doing in a medical trial, so you're flipping a coin, heads you're in the treatment group, tails you're in the control group. Then we're able to work out whether a new treatment, whether that's a COVID vaccine or some form of surgery, actually has the impact that it's intended to have. Over the years flipping a coin has saved countless lives in medicine. We're aiming to bring that same scientific critical approach to certain areas of policy, and these online service trials will be one of the early ways in which the Australian Centre for Evaluation will aim to make government work better.

DELANEY: Okay. So the coin toss is the process, whether it's actually literally tossing a coin or not, or using some other random process, to determine which subjects will be in the test group and which subjects will be in the control group. And for those not familiar with the terminology, the control group generally is the people that don't get the new product, isn't it?

LEIGH: Yes, or get a different program, and so this might be some small tweaks in terms of what you're getting on the online service platform. Everybody would have the opportunity to opt out, and we're going through careful, rigorous ethical review here. This is really the same kind of way of testing that you're seeing in a whole lot of large businesses now. Businesses, as a way of life, will engage in what they call A/B testing. Firms like Google, Amazon, are doing these all the time. So this is the same philosophy that big firms are employing in order to ensure that they're best serving their customers.

DELANEY: Okay. So is this specifically related only to online employment services?

LEIGH: That's right. So that's the bit of the employment services program that is run by government, and then we have in‑person services which are provided by private and not‑for‑profit providers. Right now we're just looking at trials within the part of the system that is the remit of government.

DELANEY: Okay. 'Cause you know I have fond memories of the good old Commonwealth Employment Service where, you know, they actually helped you to find a job.

LEIGH: Many do. That was, of course, a quarter of a century ago, and so that expertise is long gone from the public service. We're carefully reviewing how we can improve employment services, and of course there's those who are saying we should bring the Commonwealth Employment Service back. I suspect reform is not going to be just winding the clock back 25 years. It's a different world of work today.

DELANEY: Okay. Now the Productivity Commission has announced that in fact we're going backwards, and in fact the press release from the Productivity Commission says, 'Productivity goes backwards as Australians running to stand still', which is a description of how most of us feel; we're working flat out just to stay where we are. What can we do to fix that?

LEIGH: Well, it's been a lousy decade of productivity growth, and that's been showing up in flatlining real wages. Over the past decade Australia really missed so many opportunities, and we're aiming to turn that around through promoting economic dynamism. We've got a new Competition Taskforce looking at competition reform, we're ensuring that we're providing those fee‑free TAFE places, and the additional university places so more people get the education they need to be more productive. We’re harnessing data and digital technology, working to minimise cyber risk and maximise AI opportunity, and recognising the opportunities for net zero transformation. As ultimately the marginal price of energy comes down, Australia really does have an opportunity to be a renewable energy superpower.

DELANEY: Now I spoke with Peter Martin a bit earlier today and he suggested that some of the reporting around this release from the Productivity Commission has been perhaps not entirely accurate. So what does the Productivity Commission report actually tell us?

LEIGH: It shows us that productivity has gone down, that Australians are paying the price for a wasted decade under the former Government, that there's an awful lot more we need to do in order to boost the productive capacity of the economy.

Productivity isn't about working longer; it's about working smarter. It's about getting more out of every hour. Over the course of the last century we've seen Australians now go to producing in a single day what our ancestors a century ago produced in a week. Productivity has gone up seven‑fold. That's a pretty remarkable change, and that's really the driver of living standards in the long run.

DELANEY: Anybody who's been living since the second half of the 20th century has effectively had the capacity to live a better life than royalty did centuries ago, simply due to the benefits of modern technology, modern medicine, even the lowliest amongst our community is so much better off than people were 2 or 300 years ago, but we sometimes forget that, don't we?

LEIGH: Absolutely. As one of the Monarchs on her deathbed, I think it was Queen Victoria, said 'All my riches for another day of life'. They would have loved to have the opportunities and the modern medicines we have and the technologies that we take for granted. But we need to ensure that we keep those engines of growth going, that we're using the opportunities that we have in society. Things like ensuring that we're making the most of the productive capacity of Australian women through childcare reforms, where previously many Australian women had said it's just not worth moving from part‑time to full‑time, because the childcare costs outweigh the extra earning. Well, we've changed that through our childcare reforms. Not only do those women benefit but the whole economy becomes more productive as a result.

DELANEY: Speaking of the Productivity Commission, I was away last week, I spent 10 days in Queensland, and it was absolutely fantastic, thanks for asking. But speaking of the Productivity Commission, last week it was found that there were failures of leadership within the Productivity Commission that allowed a culture of sexism, sexual harassment, bullying and discrimination at its Canberra office. Now I'm sure you'd be absolutely shocked to hear that finding.

LEIGH: Yes. We commissioned an investigation into those allegations. They’re incredibly serious, and we need to ensure that the Productivity Commission, like every other Australian workplace, is free of bullying and harassment. The Productivity Commission leadership itself is working through the findings of that independent inquiry, and it goes alongside the work that the Government has done through the Jenkins Inquiry. To make sure that Parliament is an effective workplace, and to stamp out sexual harassment as it arises right across the workplace. Again, sexual harassment isn't just an issue for those who are harassed. It's an issue for the entire economy. It loses the productive capacity of talented victims of sexual harassment.

DELANEY: Well, that being the case it leads nicely into my next question here. If the Productivity Commission is riddled with this culture of sexism, sexual harassment, bullying and discrimination, things that we know hurt productivity, how can we trust anything they say about everybody else's productivity? 

LEIGH: I don't think they're riddled with it. I certainly think that there were incidents that were raised and those are being dealt with by the Productivity Commission leadership. These are allegations that were raised a number of years ago, and so in some cases some of the individuals involved, as I understand it, have left the organisation. We commissioned an independent inquiry though because we're concerned about this, as we would be about bullying and harassment allegations in any other part of the Commonwealth Public Service. It's just not on. Danielle Wood is the new head and I think will be a terrific appointee, both in terms of her intellectual leadership but also in terms of her cultural leadership. She was one of the co‑founders of the Women in Economics Network, so she understands the importance of leadership on that front.

DELANEY: Yeah, I'm pretty sure she's not going to put up with any nonsense.

LEIGH: Precisely.

DELANEY: Indeed. Putting on your hat as Assistant Minister for Charities, I saw a story today that in New South Wales the Rural Fire Service Association, which is a not‑for‑profit charitable organisation intended to support volunteer fire fighters, has spent only about 16 per cent of the $69 million it has raised since 2014 directly on Rural Fire Service members. Where is all the rest of the money going, and what sort of regulation failure has taken place here?

LEIGH: I saw that story as well and I'm certainly concerned as you are. The job of politicians is not to be regulating charities, that's the Australian Charities Not‑For‑Profits Commission, so hopefully those issues will have been raised with the charities commission. Under current law they're limited in their ability to say that they're investigating a charity, we're setting about changing that, because we do think that in certain instances it may well be in the public interest for the regulator to be able to say we're looking into these allegations that have been raised in the press.

DELANEY: Part of the problem seems to be the structure here, whereas the RFSA is in fact a registered charity, but it operates in conjunction with another entity, which is a for‑profit private business, and that raises the question, because the people running that for‑profit private business say that they have complied with all of the regulations as they exist. Do we need to re‑examine those regulations and make sure that the money that's donated to a charitable cause, whether it's through direct donations or sales of art union tickets or any other form of fundraising, that a significant proportion of that goes to the intended charity? 

LEIGH: There's no cap at the moment on the share of costs which go to fundraising, and I understand that's the chief allegation that's being raised in the Nine papers’ reporting. This is something that donors will be looking at, I'm sure those who have been supporting the organisation will be asking questions themselves. It is important to say the Rural Fire Service Association is independent from government. It’s answerable to its membership and its donors, and it will need to acquit to those members and donors how it's gone about spending that money.

DELANEY: Yeah, but of course the other entity, the private for‑profit entity which is like basically a telemarketing company that apparently is quite aggressive in its telemarketing tactics, they claim that they've followed the rules, but really they certainly need to be reined in, don't they?

LEIGH: There's no limit at the moment in terms of what a telemarketer can charge, that's up to the charity, which is then answerable to its donors and members. I certainly understand the frustration people would have in looking at this story, but ultimately we're trying to limit the regulatory burden that we place on charities. So we're always trying to strike a balance, Leon, between putting more rules in place and ensuring the charities don't have to spend their time complying with government dictates and can focus on the most vulnerable.

DELANEY: It should be a pretty simple rule, shouldn't it, to make sure that at least 80 per cent of the money raised for charity goes to the actual charity? 

LEIGH: Even simple rules have compliance costs, so that's the balancing act we're engaging in. But I certainly agree with you, this has implications not only for the Rural Fire Service Association, but also for the trust and confidence in the community sector. The 60,000 charities in Australia, the vast bulk of them are out there doing fabulous work, they're frustrated to see negative stories about charities appearing in the press, because that doesn't just hurt that particular charity, it can undermine trust and confidence in the sector, which is critical to the work that charities do.

DELANEY: It absolutely is. Andrew, thanks very much for your time today.

LEIGH: Thank you, Leon.

DELANEY: Dr Andrew Leigh, Assistant Minister for Competition, Charities and Treasury, Assistant Minister for Employment, and of course our very own local member here in the seat of Fenner.