A Text-Book Example Of Political Presentation

by John Warhurst - Canberra Times

The Prime Minister's handling of his decision to pull out of the sale of the Snowy Hydro was a textbook example of how to make the best of a bad job.

He ate some humble pie, admitted the original decision was wrong, and tried both to protect his flank and to extract whatever positives he could from the policy reversal.

Helpfully, he was treated generously by important media. The strategic interviews with John Laws and Alan Jones shortly afterwards are ingratiating love-ins to read but were politically invaluable.

The Prime Minister played down his part in the original decision, arguing that the sale has "never been a policy commitment or an election commitment of the Commonwealth government". That is gilding the lily.

Legislation is a policy commitment. While he legitimately pointed out that the initiator had been the NSW government, the fact remains that the whole episode, what Howard now dismissed as a 20th order issue, fitted seamlessly into the government's whole decade-long approach to privatising public assets.

Howard gathered all his own troops inside the tent. Senator Nick Minchin, the action minister, who had articulated the privatisation case enthusiastically right up to the death was now portrayed as someone who strongly agreed with the PM's decision.

But inevitably the minister emerged as more of an ideologue, a privatisation zealot to use Howard's words, than his more flexible leader.

Gary Nairn, Special Minister of State and the local member for Eden-Monaro, was praised for his public loyalty and private convictions, and given credit for being crucial in the reversal.

Bill Heffernan, the NSW Liberal senator who broke ranks against the government decision, was lauded as a terrific mate, a great bloke, and a great friend. No praise was too high for Heffernan, the erstwhile enforcer of government discipline. Yet Heffernan's dissent was no different from that of Barnaby Joyce over Telstra or Petro Georgiou over detention of asylum-seekers. There is one rule for mates and another for the rest.

Outside the circle of friends was the NSW Government. Whether or not Howard was smarting from the NSW Government's unilateral decision to initiate the sale, he himself was certainly unilateral in withdrawing from it.

Morris Iemma had to content himself with a phone call that morning from Minchin to the answering machine of one of his ministers. His political opponents were left to swing in the breeze. It is a dog-eat-dog affair rather than true collaboration, and a bleak insight into ice-cold federal-state relations.

Also outside the circle were those beyond the Liberal Party who had been opposing the sale for some time. There was no hint of appreciation of the dogged role of the independents such as Peter Andren in supporting public opposition to the sale. It was as if they didn't exist.

No public appreciation either for the role of the Nationals, especially backbencher Kay Hull. All the kudos was kept inside the Liberal Party.

He tried to refute any suggestion that there are general lessons about privatisation from the Snowy decision. When asked about the comparison between the sale of Telstra and the sale of the Snowy, Howard argued that "there's absolutely no comparison". Yet clearly there is.

Howard also does not want to encourage the idea that public opinion can be a powerful influence on his government. If that were the case then those campaigning against other government policies would be encouraged.

Howard's formulation is very careful. He argues that "there is no harm in changing your position if there's a clear feeling in the public and a strong sentiment against what you have decided, especially when there is no policy benefit". The sting is in the tail.

There are many instances where there has been a clear public feeling against what he has decided. The list would include the War against Iraq, the sale of Telstra, industrial relations reform and, less clearly, the introduction of the GST.

But he will not accord any legitimacy to majority public opinion if he judges that there is a strong public policy reason to do the opposite. That is both logical and also subjective.

Howard argues that there are two important differences: that in the case of Telstra it was government policy at repeated elections and that there was a "long-term public benefit" in its sale. The first is undoubtedly true but irrelevant to the central point.

The latter is a value judgment, disputed vigorously by many in the community who argue the case for a long term public benefit in Telstras retention in public hands.

The real differences are a matter of scale. For the Commonwealth government, dealing with Snowy Hydro was like dealing with the ACT government. Both are small beer.

The economic differences are that the sale of Telstra is such a big earner for the government in comparison with the sale of just 13 per cent ownership of a smaller government enterprise like the Snowy Hydro.

The Government didn't need the money. There wasn't enough of an incentive for privatisation in this instance. The Snowy Hydro is small change.

The political differences are less easy to discern. One could say that the Snowy Hydro was lucky to be located in a marginal seat. But Howard wouldn't reverse a decision just for one seat, even a bell wether seat like Eden-Monaro.

So that is too simplistic an explanation. The Prime Minister was worried that there would be a flow-on effect elsewhere. Ever the political strategist, he took the easy way out. Only time will tell if his political judgment was correct.


John Warhurst is Professor of Political Science at the Australian National University.