ABC’s Alan Kohler is touting an idea I floated a few months ago, namely beefing up Infrastructure Australia’s role in assessing federally funded infrastructure projects. However Kohler advocates stripping politicians of the decision-making power and vesting it entirely in IA (cf Reserve Bank decisions on interest rates).
I strongly disagree. We elect our politicians and expect them to make the big decisions and govern on our behalf. There may be some particular decisions like official interest rate policy that are properly made solely on the basis of expert evaluation and that should therefore be left to the experts to make. But most decisions involve consideration of a wide range of factors including inherently “political” factors about competing spending priorities; political in the sense that they involve subjective judgments about which of several possible decisions should be made. Factors may be economic, social, cultural or whatever, but they’re not reducible to a formula capable of objective application by unelected experts. They are, as the High Court says about discretionary decision-making in administrative law, “questions about which reasonable minds may differ”. In those circumstances only democratic accountability to the people can provide workable safeguards.
That isn’t to deny that IA’s role needs beefing up. It does. But its role should be to ensure that government infrastructure spending decisions are properly scrutinised and transparent so that voters can evaluate these inherently political decisions. We don’t need to vest the actual decision-making power in IA to achieve that, just give it stronger evaluative powers and make it genuinely independent of the government of the day.
Under the current legislation, the IA’s members (mostly Heads of Department) are appointed for relatively short terms and its working staff are public servants and therefore not formally independent of government in any sense. However, the real problem with IA is that its functions only include evaluating the business case for new infrastructure when commissioned to do so by the Minister (see s5(2) and 5(4) of the Infrastructure Australia Act 2008). Naturally the Minister doesn’t do so unless it’s politically expedient. This problem could be readily fixed. Simply make all listed IA functions under s 5(2) exercisable if IA itself thinks fit, appoint IA members for longer terms like the RBA, require that only a minority of members can be departmental CEOs and require that at least IA’s senior management are IA employees not public servants.
IA’s transparency function should be boosted by requiring government to report to Parliament within 30 days giving full reasons whenever it makes a significant infrastructure spending decision to fund projects not contained in IA’s Infrastructure Priority Lists, and to report annually on a whole of government basis on the extent to which projects have been funded in accordance with Infrastructure Priority Lists. That would enable voters to assess the extent to which their elected representatives were engaging in expedient pork-barrelling as opposed to responsible administration in the public interest.