Carbon Tax: Which companies will pay?

I was writing an article on Monday for my paper about the carbon tax. The Government released a vast amount of information on Sunday about their new proposal. I had interviewed a couple of the local gas companies, Santos and Origin, a few weeks prior and I was keen to write about the coal seam gas industry impact of the tax, which had local implications. In her speech to the nation on Sunday, Prime Minister Julia Gillard said around 500 big companies would pay for every tonne of carbon they produce. Climate change minister Greg Combet confirmed it in one of his releases. I assumed the gas majors I spoke to would be on the list.

However a very quick look at the new government website “cleanenergyfuture” showed the list was nowhere obvious. ABC chief political correspondent Sabra Lane said those affected would be “mining, steel companies and aluminium manufacturers”. There was no mention of coal seam gas. So I set the task of finding the 500 to a keen young journalist who started here last week. I thought it might be a tough task for her because this is one of the more incendiary consequences of the legislation and therefore one the Government might not be keen to publicise. I gave her 15 minutes to find it.

After 10 minutes of silence, I realised this must be harder than I thought and I went looking for it again. I was no more successful than my new journo, so I thought it was time to ask Twitter. Turns out it wasn’t obvious there either. “Good question” was the best response I got; others were on the line of “let us know if you find out.” In the end what we wrote in the newspaper was “precise information on which companies were in or out were not available when the Western Star went looking.”

Annabel Crabb did find more precise information when she turned her attention to the problem yesterday. Crabb wondered who was in the “Misfortune 500 and said the biggest companies may not be the biggest emitters of carbon. "Can we get a list?," she asked. “No - we can't" said the Government. The 500 companies are not an identified list but an estimate of how many companies in Australia would be caught by the scheme's eligibility rules.

I eventually found the Government page that talks about the 500 companies. “Most are companies operating large facilities (with over 25,000 tonnes annual CO2-e emissions) that directly emit greenhouse gases, such as power stations, mines and heavy industry,” the site said. “Some are public authorities responsible for emissions from landfills.” A fact sheet gave a breakdown of where the companies were. NSW and Queensland had half the companies, 100 were involved in coal, 60 each in electricity and heavy industry, 50 in other fossil fuel and 40 in natural gas. I assumed the latter category covers my local companies, but could not confirm this as there were no company names in the fact sheet.

For political reasons, petrol and agriculture are exempt and Crabb explained other problems with the eligibility rules. “A company with 20 facilities each emitting 24,000 tonnes of CO2 a year would not be liable, while some poor boob with one factory emitting 26,000 tonnes of carbon dioxide and 19 clean green beansprout-fired tofu smelters would still have to cough up.”

Crabb found the compulsory reporting that is done under the National Greenhouse and Energy Reporting Act 2007. The National Greenhouse and Energy Reporting on “Greenhouse and Energy Information 2009-2010" has a list of 300 companies that emit more than the 2009-10 annual threshold of 87,500 tonnes a year. It does not break the data down by facility but it is difficult to see how companies like Macquarie Generation (23.4 million tonnes), Delta Electricity (20.45m), CS Energy (16.8m), TRUenergy (15.6m), Blue Scope Steel (10.8m), Woodside Petroleum (8.4m), Alinta (7.8m), and Alcoa (6.75m) can avoid paying some of the tax. There were only 300 companies in this list, so 200 others need to be added.

Both of the coal seam gas companies I was interested in were on the list, Santos at 3.57m and Origin at 1.87m. So the likelihood is, as I suspected all along – they will both be in the 500. At $23 a tonne I estimate Santos will have to pay $85m a year and Origin $43m. Macquarie Generation (getting their message out through the sympathetic Australian) are up for a bill of $538 billion. Despite what the Government said, it should not have been that hard to find out. Watch out too for fiddling along the edges as companies try to make the most of that “facilities” loophole.

Gov 2.0 roadshow comes to Brisbane

The federal Government 2.0 taskforce roadshow rolled into Brisbane today as part of its series of open forums in all the state capitals. The federal government sponsored taskforce’s aim is to increase public sector information and online engagement. About hundred or so people came along to 175 Eagle Street in central Brisbane to give input to taskforce about making governance more democratic and accountable. In attendance was chair Nicholas Gruen and three other members Brian Fitzgerald, Lisa Harvey and David Solomon

While the “2.0” in the name suggests the use of web 2.0 read-write tools, the biggest task for the government (if it is serious about it) will be engendering cultural change in a public service that is used to zealously guarding information. The cultural nature of the problem is shown in the taskforce’s terms of reference. Their aims are to make government information more accessible and usable; make government more consultative, participatory and transparent; build a culture of online innovation within government; promote collaboration across agencies and try out something new.

The roadshow was a roadmap of how they might approach the task. Gruen ran the proceedings. Nicholas Gruen is the CEO of Lateral Economics and a former economics adviser to two Labor governments in the 1980s and 1990s. He also writes for the Australian Financial Review and blogs at Club Troppo. He began by saying the taskforce had to engage skeptics and show that Government 2.0 was a way of delivering on the mission of agencies that was better than the way they do it now. He then threw the session open to suggestions from the floor.

Most of the first hour of the session got a bit bogged down on records management. Several members of the audience wanted to know how governments would manage public access of intermediate documents, and whether people would have the opportunity to give feedback on unfinalised documents. Gruen said government agencies had an obligation to consult on policy development and spoke about using blogs and date/time stamped wikis that can track changes to ensure a transparent history. But he also noted there was a difference between public and private spaces for conversation. He said some requests for FOI, such as a recent Daily Telegraph request for the butchers’ paper of a government conference, were “frivolous”.

Gruen then passed the baton to Lisa Harvey who is an IT specialist working in the not-for-profit sector. She said the government’s role should be one of “facilitation, feedback and watching”. What she wanted to see was a conversation between constituents about the issues that mattered to them. One audience member then asked about how this conversation would be moderated given the likely divergence of views and the possibility it could spin out of control. Gruen said we needed to be more libertarian about it. He said that on his blog (Troppo), he does not tell commenters what to do. The one rule there is: “use your common sense”. But he admitted he would have difficulty convincing governments of this.

Gruen was of the view that as much as government information as possible should be in the public domain so that citizens could comment on it. In his words, it equated to the open source mantra of Eric Raymond that “enough eyeballs make all bugs shallow”. But as almost everyone in the room agreed, it was more a matter of culture change than technology that was required. He wanted to give the government a forum where they could openly say “we stuffed it up” and look for help to fix problems.

The last day for submissions to the taskforce was yesterday. It will provide a final report on its activities to Lindsay Tanner, the Minister for Finance and Deregulation by the end of 2009 at which time the taskforce will disband and hand over to a government-appointed information commissioner. The challenge will be to show this is not merely technological determinism where society adapts to new technologies to avoid complex questions about their impact or who controls them.

What the force needs to do is meet head-on the hoopla that greeted Tanner’s announcement of the board in June. “We have to accept that when we open ourselves further to public discussion…we won't always like what we hear,” he said at the time. “But if the new technologies and ways of using them mean that government is in closer and deeper contact with citizens it serves, and is harnessing their best ideas, the government will only benefit.” Roll on, the day.

Kevin Rudd’s Brisbane community cabinet

Narangba Valley State High School was the venue today for the Rudd Government’s second ever community cabinet. The idea was an election promise and brings together Kevin Rudd and his entire cabinet in front of a public audience for a question and answer session. Afterwards there are one-on-one meetings with each of the ministers available for consultation. I attended today’s session along with 800 others in the school hall.

While security was tight on the roads leading to the school, I surprisingly got in without a bag search. The outer northern suburban location was carefully chosen, being in the constituency of Longman where the former Howard Indigenous Affairs Minister Mal Brough was spectacularly defeated with a massive swing of 10.3 per cent. The new sitting member Jon Sullivan introduced today’s session. He was followed by a local Aboriginal elder’s "Welcome to Country" and a brief address from Queensland Premier Anna Bligh.

Bligh said she was delighted to welcome the cabinet to Queensland and also happy that they had taken up a Queensland Government initiative to hold community cabinets. She welcomed the Prime Minister who, she said, being born one hour north of Narangba was, “one of us”. She also noted that Rudd had turned the sod on the Ipswich Motorway that morning and said he had proven he was a man who was “going to deliver”.

Kevin Rudd then took the podium looking relaxed, comfortable and jocular. He announced today was Transport Minister Anthony Albanese’s birthday (45th) and he asked the audience to go easy on “Albo”. He then went on to introduce all the ministers on the podium. Present were Deputy PM Julia Gillard, Treasurer Wayne Swan, Albanese, Joe Ludwig (Human Services), Lindsay Tanner (Finance), Stephen Conroy (Communications), Nicola Roxon (Health), Simon Crean (Trade), John Faulkner (Special Minister for State), Jenny Macklin (Indigenous Affairs), Chris Evans (Immigration), Penny Wong (Climate Change), Joel Fitzgibbon (Defence), Robert McClelland (Attorney-General), Martin Ferguson (Resources) and Tony Burke (Agriculture, or as Rudd called him “the farmers’ friend”).

The only notable absentees were Foreign Minister Stephen Smith who was overseas (Rudd said “we’ll forgive him”) and Environment Minister Peter Garrett who was in Sydney for Clean Up Australia Day. After the introductions, Rudd began by saying the community cabinet was them being here to answer questions. The idea, he said, was that governments would remain in touch with people. He said all wisdom does not lie within the commonwealth public service and events such as this and the 2020 Summit give the government the chance to bring in new thinking. “Different ideas how we do things better,” he said.

Rudd said he was delighted to be in the seat of Longman which he called “a growth corridor” with the population up 25 percent since 2001. He said that placed great impact on roads, schools, hospitals and local services which pose a challenge to governments. He mentioned all the promised spending in the area such as $200 million on the Bruce Hwy upgrade, $125m on the northern missing link from the Gateway Motorway at Nudgee to the Bruce Highway and $30m on Caboolture blackspots. He also promised funding to local organisations such as the PCYC and local sports clubs. He then opened the floor to questions.

The first question related to the Howard’s Government 2006 family law reforms. The questioner said the laws were unworkable and on custodial matters courts were ignoring evidence and judging on hearsay. A-G Robert McClelland said the fifty-fifty residence presumption “kicks in the middle of this year”. The government would monitor the impact of legislation to orders of domestic violence. He said magistrates were aware of the consequences. It was important, he said, to remove perpetrators of violence and make “families and children safe”.

The second questioner said 7,000 people die each year from lung cancer making it one of the biggest cancer killers in Australia but wanted to know why it attracted just 5 per cent of research funding. Kevin Rudd was sympathetic saying his own mother died three years ago of lung cancer. He said there was $250 million promised in the election for research and clinical trials. Health Minister Nicola Roxon said she had not met the Australian Lung Foundation yet. The challenge was to deal with very specialised treatment. She said she was talking to state ministers about cancer care in public hospitals.

An aboriginal woman wanted funding for a round table group and was encouraged to talk to Jenny Macklin later. Similarly a group looking for federal funding for the Caboolture Regional Arts Development was encouraged to put in a submission to the 2020 Summit. Lobbyists for a cultural centre in Caboolture area were asked to talk to Albanese afterwards where their application “would be given due consideration”.

The next questioner wanted to know what the government were doing about housing affordability which was causing a “financial crisis” for many in the area. Rudd said homelessness was a major challenge with 100,000 homeless people in Australia according to the census and 10,000 sleeping rough each night. He said that “in a country as wealthy as ours, that should not be happening”. He said the Minister for Housing Tanya Plibersek was putting together a white paper on homelessness with the Brotherhood of St Lawrence due by year end. But there would be “no quick and easy one size fits all fix”. There had to be a holistic approach that also looked at these people’s health problems so they had the wherewithal to become self-reliant.

The next questioner was a land developer who wanted to know how the government would “cut through the red tape” to allow his land to be released for “first time home buyers”. Rudd answered again, saying the affordability crisis affects young people who spend “38 per cent of income” in mortgage repayments. The government is holding a summit on housing affordability. Wayne Swan is establishing a new, low tax, First Home Saver Accounts scheme and on the supply side they are looking at three separate policies to deal with rental accommodation, state governments and local governments.

The next questioner wanted to know if the government would meet the Millennium Development Goal target of 0.7 per cent GNP foreign aid by 2015. He also noted that the previous government included such items as border protection, terrorist prevention and the Pacific Solution as “foreign aid”. Rudd answered on behalf of the absent foreign minister. He said that currently aid was 0.34 per cent and Australia would commit to 0.5 per cent by 2015. He admitted that fell short of the 0.7 per cent but said “it was a step in the right direction”. He also said the government have abolished the Pacific Solution.

The next questioner said the government could solve the housing affordability crisis by removing negative gearing. Rudd began by saying the previous government had no ministry for Housing so did not take the problem seriously. He said this was “core business” for Labor and “absolutely fundamental for working families”. However, he said continued negative gearing was an explicit election commitment which they didn’t intend to breach.

A questioner from a steel company said the skills crisis was caused by poor training. He said they had a proposal which would be a “gift to the government”. In her only contribution, Deputy PM Julia Gillard acknowledged that her chief of staff had already talked to the firm and would follow it up. A Brisbane aboriginal questioner wanted to know what the government were doing to “close the gap” on health. Jenny Macklin responded by acknowledging that most Indigenous people lived in urban areas and any health solution needed not just to focus on remote areas. The government would not be able to close the gap on life expectancy if it didn’t cover urban areas.

The youngest questioner was a young boy who stood on a box to ask what the government were doing about Type 1 Juvenile Diabetes and whether they would fund insulin pumps which cost $8,000 each. Rudd said he had talked with doctors in Launceston about type 1 and 2 diabetes and both categories “demand action”. Roxon said a submission for the pumps is being considered by the government. She hailed the Juvenile Diabetic Research Foundation as a “very effective lobby group”.

The next questioner said Queensland Transport does not seriously take into account independent submissions on public transport options and there should be central co-ordination of transport plans. Albanese said he has met all the state transport ministers but disagreed it could be managed centrally. Then a person suggested the government should subsidise sport for low-income families. Roxon said she was working with Sports Minister Kate Ellis on preventative health schemes but couldn’t give questioner a specific answer.

The last question came from the Aboriginal elder who gave the “welcome to country”. She said the Native Title Act needed to be scrapped or at least simplified. She called it a “lawyer’s goldmine and a minefield for Indigenous people”. Attorney-General McClelland agreed Native Title was “horrendously complex”. He said “we needed to focus on getting outcomes” not on looking knowledgeable about the legislation. He said the government was focussed on “long term productive outcomes”.

That ended the public session after the best part of two hours. The cabinet ministers then retired with their assistants and senior public servants to meet with individuals and lobby groups. While it is doubtful that any new agenda item got raised or anything much got fixed this is still an excellent idea and shows a interested and eager government ready to serve. Kevin Rudd dominated the proceedings and it clearly the star performer, but it would be have been good to hear more from Gillard, and anything at all from the silent Treasurer Wayne Swan. But all participants seemed focussed and genuinely happy to be there. Whether the same enthusiasm is there in two years time remains to be seen, but this is a very positive step in engaging the citizenry. And Brendan Nelson's Liberals never looked more irrelevant than today.

Phoney war is over: Howard calls the election

After months of pseudo-campaigning, John Howard today called a federal election for Australian voters on 24 November. The six week campaign is likely to be heavily presidential in style with a large focus on the record of the two leaders, Prime Minister John Howard and Labor leader Kevin Rudd. The 68 year old Howard is seeking a fifth and apparently final term in office, having promising to hand over the reins of power to his deputy Peter Costello “some time” in the next three years. Howard emphasised the continuity of his leadership team in his election announcement today, saying it was “the leadership that has the experience to further expand the prosperity of the Australian economy and to ensure that everybody gets a fair share of it.”

But voters are not heeding this message, if the opinion polls are to be believed. Labor has a 12 percent lead in Two Party Preferred terms. Many commentators see Labor leader Rudd as a younger version of Howard. Rudd is a self-described “economic conservative” and has taken the “small target” strategy used so successfully by Howard when he won power in 1996. However there are strong areas of difference between Rudd’s Labor and the ruling Coalition. Labor has pledged to sign the Kyoto Protocol on carbon emissions and also roll back the Government’s most controversial industrial legislation, Workchoices, which Rudd said today “[strips] away penalty rates and overtime and basic conditions which working families for generations have enjoyed."

While Labor and the Coalition will dominate the lower house, a slew of minor parties will be hoping to form the balance of power in the Senate. The Liberals gained outright control of the review house for the first time since 1961 in the last election but opinion polls suggest that they will lose some seats this time round. Because most Senate seats (except for the 4 ACT and NT seats which are one-term only) are six year tenures, only half its members are up for re-election this time round. All four Democrats are up for re-election but only Queensland’s Andrew Bartlett has any realistic hope of winning this time round. The Greens have two senators seeking re-election in Tasmania and NSW and have also hopes of winning in Victoria and Queensland. South Australian ‘no pokie’ independent Nick Xenophon is the new wildcard having decided last week to move from the SA upper house where he took a staggering 22 percent in the last state election.

Because of the plethora of electoral bodies at local, state and federal level, Australians seem to be in almost perpetual electoral mode. The first parliamentary election in Australia occurred in 1843 when propertied adult males were granted the right to vote for the NSW Legislative Council. By 1859 all the eastern seaboard colonies had full secret ballot suffrage for all adult males over 21. In 1894, South Australia followed New Zealand’s lead to become only the second polity to allow women the vote. This right was extended to all states by 1908. Early elections were voluntary but by 1924, all parliaments had made voting compulsory.

Australia is one of about thirty countries that enforce some form of compulsory voting. More accurately it is a compulsory duty to attend a polling place. All political parties have a self-interested reason to retain this system and there is no need for parties to campaign to ‘get out the vote’. Currently the fine is $20 for non-compliance and even this fine is not strictly enforced. Nonetheless the system ensures that turnout in Australian elections is always in excess of 95 per cent of eligible voters.

The federal government has a three year term of office. The House must be dissolved no later than three years since the first sitting after the previous election (hence Howard could have in theory delayed the election until January 2008). There is no minimum term. A government can call a double dissolution election if the Senate fails to pass a Bill twice. From 1901 to 1973 there were only two such dissolutions but then there were four in fifteen years: 1974, 1975, 1983 and 1987. There have been none since.

About 3 percent of the voters, either accidentally or deliberately cast what is called a ‘donkey vote’. These voters simply number the boxes on their ballot paper from top to bottom. Prior to changes in the Electoral Act in 1984, candidates were ordered on the paper in alphabetical order, a candidate whose surname started with ‘A’ or ‘B’ stood a greater change of winning. Since 1984, the position on the paper is now in random order but because the donkey vote still exists, getting a position on top of the ballot paper remains a significant advantage.

Although the government changed the laws in April to close enrolment on the day of election, there is a still a small window of opportunity for voters to get on the rolls to vote this time round. Enrolment for new voters ends on the same day as the electoral writs are issued. This occurs at 8pm this Wednesday 17 October. Those already on the rolls but with an out of date address have an additional week to get their details up to date.

Mo Ibrahim releases African governance ranking

Somalia has been ranked as the worst governed nation in 48 countries of sub-Saharan Africa ahead of Congo and Chad in a survey of political performance, released this week. The study by the British-based Mo Ibrahim Foundation showed that Mauritius was the best governed in the continent and many of its fellow island nations filled the top places. Recovering from its 1994 genocide, Rwanda has made the greatest recent improvements. The index ranked the countries on five factors: safety and security; rule of law, transparency and corruption; participation and human rights; sustainable economic opportunity; and human development.

The man who gave his name to the ranking is Mo Ibrahim; a London businessman, born in Sudan. Ibrahim made his millions in telecommunications and he owns the fastest-growing mobile phone group in sub-Saharan African. The 61 year old Ibrahim began his stellar career by having a brainwave in a taxi cab in 1965. Because he couldn’t figure out how a signal reached the cab radio, he spent several degrees trying to find the answer. He then graduated from British Telecom to his own consultancy firm. Africa remains his passion. He established the foundation in his own name to stimulate debate on governance, provide criteria to judge it, and recognise achievement to those that made it.

As well as the index, later this month (22 October) Ibrahim will announce the first winner of a prize for achievement in African leadership. The prize will land one former head of state or government leader $5 million over 10 years and a further $200,000 a year annually. A further $200,000 will be made available for good causes chosen by the winner. It far exceeds the $1.5 million dollars given to recipients of a Nobel Prize and will be chosen by a committee of Kofi Annan (former UN gen-sec) , Martti Ahtisaari (former Finnish President), Aïcha Bah Diallo (former Guinean politician and UN advisor), Ngozi Okonjo-Iweala (Nigerian politician), Mary Robinson (ex UN High Commissioner for Human Rights) and Salim Ahmed Salim, (ex PM of Tanzania).

In the meantime, Ibrahim’s comprehensive publication of a ranking of governance quality in sub-Saharan Africa will cause much debate within the community about its accuracy. The top ten ranked in order (pdf) are Mauritius, the Seychelles, Botswana, Cape Verde, South Africa, Gabon, Namibia, Ghana, Senegal, and São Tomé and Príncipe. Four of these are island nations including the top two, as well as Cape Verde, and São Tomé and Príncipe. Of surprising interest perhaps is that Zimbabwe was ranked 31st, still ahead of 16 other countries.

The terms of the study were developed under the direction of the Kennedy School of Government at Harvard with the help of African academics. The 48 nation states were assessed against a comprehensive new index of governance indicators measured against clear, objective outcomes. Ibrahim himself believes they are improving the quality of governance in Africa and offering a model for the rest of the world. "(The) Index is a tool to hold governments to account and frame the debate about how we are governed,” he said. “Africans are setting benchmarks not only for their own continent, but for the world."

Mauritius is judged the best overall with a combined score of 86.2, scoring best on safety and security (91.7), 90 on human development, 88.7 on participation on human rights; 85.2 on rule of law, transparency and corruption, and 75.5 on sustainable economic opportunity. The result follows an International Finance Corp report last month for the World Bank that judged the island the easiest African nation to do business with.

Despite the success in the islands along the fringes, doing business in much of continental Africa remains fraught due to bureaucracy, a fragile investment climate and inadequate infrastructure. The bottom five on Ibrahim’s report were Guinea-Bissau (42.7), Sudan (40.0), Chad (38.8), the Democratic Republic of Congo (38.6) and government-free Somalia was rock bottom with just 28.1. The entire Horn of Africa emerged as the most crisis ridden part of the continent with neighbours Eritrea and Ethiopia both scoring badly.


The Mo Ibrahim Foundation was launched in 2004, has the backing of Nelson Mandela, Kofi Annan, Bill Clinton and Tony Blair, among others. Director of the foundation and Kennedy School Professor Robert Rotberg, lauded a trend that saw African businessmen take on the challenges and try to do something about governance. "Good governance is responsible for bringing peace, stability and prosperity,” he said. “Bad governance is responsible for conflict and poverty."

Mixed results in World Bank corruption report

A new World Bank report has praised African nations for their fight against corruption. The report measured the quality of governance in 212 countries from 1996 to 2006 and found Africa had shown the greatest improvement. The report did, however, find that the gains and losses balanced out such that the average quality of governance worldwide over the past decade has not improved much. Finland, Iceland, Denmark Norway and New Zealand were judged the least corrupt countries in the world while Somalia, Myanmar (Burma), Equatorial Guinea, Haiti and Zimbabwe ranked most corrupt.

The World Bank’s Daniel Kaufmann, co-author of the report and director of the banks knowledge-sharing and training arm, said that bribery is costing world $1 trillion a year with the billion people living in extreme poverty worst affected. “The burden of corruption falls disproportionately on the bottom billion people living in extreme poverty,” he said. Kaufman said improvements in governance are critical for aid effectiveness and for sustained long-run growth.

The report entitled Governance Matters, 2007: Worldwide Governance Indicators 1996-2006 highlighted the number of African countries that had made great strides in improving various aspects of government. Using criteria such as accountability, free media, political stability,government effectiveness, regulatory quality, the rule of law and control of corruption, the report covered 212 countries and territories and drew on 33 different data sources. It captured the views of tens of thousands of survey respondents worldwide, as well as thousands of experts in the private, NGO and public sectors.

Some countries such as Venezuela, Zimbabwe, Eritrea, Ivory Coast and Belarus had regressed in the timeframe of the survey. But others are doing well: Kenya, Niger, Sierra Leone, on leadership accountability, Algeria and Liberia on the rule of law, Algeria, Angola, Libya, Rwanda and Sierra Leone on political stability and Tanzania on corruption. Outside Africa, those making significant gains included Indonesia, Ukraine, Columbia, Turkey and Afghanistan. Meanwhile corruption is on the rise in Bangladesh, Poland, Kyrgyzstan, Moldova and Pakistan.

Management of corruption is now a key World Bank benchmark. Many of the debts of the world's poorest countries have been written off under the Bank's Heavily Indebted Poor Countries (HIPC) initiative and increased aid flows to them on condition that they stamp out corruption. HIPC started in 1996 and was enhanced in 1999 as an outcome of a comprehensive review by the International Development Association (IDA) and the International Monetary Fund (IMF). HIPC’s debt-burden thresholds were adjusted downward, which enabled more countries to qualify for larger volumes of debt relief.

The report showed that corruption in the US has significantly worsened in the last decade. The World Bank scored the US on the same measure as Chile. Similar surprises showed emerging economies such as Botswana, Costa Rica and Lithuania, scored higher on the rule of law and corruption than two industrialized countries Italy and Greece. Daniel Kaufman the report showed the power of data “It begins to challenge these long-held popular notions that the rich world has reached nirvana in governance,” he said.

However Kaufman also admitted that the Bank’s own recent scandal involving former President Paul Wolfowitz has impacted the credibility of both the report and the bank itself. Wolfowitz was forced to resign in May after he violated a World Bank ethics rule forbidding personal relationships between bank employees and their supervisors. Kaufmann said countries rightly asked the Bank, "What right do you have of rating the world when you first have to rate yourselves? It has to start at home."

Governments and Culture

Modern governments play a key role in promoting culture and cultural policy. This essay will examine why governments want to influence and regulate the forms of culture practised by its citizens. It will examine the history of how governments became involved in cultural policy and will then go on to discuss the means by which it achieves these ends. The essay will examine the social consequences of intervention and what implications that has in an Australian context. It will also consider the example of the Labor cultural policies of the 1990s to examine the influence of its funding decisions and priorities. The evidence of the essay will show that government cultural policy reflects the vested interests of an elitist status quo regardless of whatever democratic intentions it may aspire to.

To understand the rationales and objectives of governmental views to culture, it is first necessary to look at the etymology and history of the word culture itself.
Culture is one of the most complicated words in the English language and its twisted evolution reflects that complexity. It grew from its initial use as a biological process of husbandry to become the process of human development and the social heritage of a community. This very broad definition encompasses all forms of thought, art, traditions and rituals irrespective of what value society places on them. But along the way, it also picked up a narrower definition based on the prevailing aesthetic of a superior European culture. This selective view had strong connotations of elitism as it cherry-picked the high art forms and traditions of 19th century Europe and ascribed greater value to these selected forms. It was an act of selection that ascribed values to those making the selection. It also meant that the narrower view of culture could serve as a distinguisher between persons. This view of culture not only classifies but also “classifies the classifiers” as Pierre Bourdieu pointed out. Thus the narrower view perpetuates a closed system whereby elitist forms of culture hijacks the broad basis of culture and determines that their culture is the preferred one.

This evaluative distinction of culture started to appear in the late 18th century and evolved further in the 19th century. Around the time as the word was accumulating new meanings, the British Government began its work in managing and regulating populations. As culture began to be seen as an object and instrument of government, authorities undertook a radical re-shaping and re-organising of traditions. Because of the elitist distinctions inherent in the definition of culture, it was only the traditions of the sub-ordinate classes that were seen as a problem. Robert Malcolmson demonstrated how governments launched a full scale assault on popular recreations in urban plebeian communities. Many activities which the working classes found good to think with, such as blood sports, boxing, street football, fairs and wakes, were all targeted for regulation. Most blood sports were suppressed entirely. The tactics used were prosecutions, convictions, sermons, journalistic attacks, and personal interventions. The government campaign was aided by agencies such as magistrates, the clergy and the press. Blood sports were deemed barbaric; though the thoroughly gentrified fox hunting escaped the general opprobrium. Street football had been played for centuries but now disturbed the normal routine of business. Fairs and wakes offended public order and morality and had to be stamped out. The only events that survived the cull were the ones that had independent economic value. In the growing towns, working class public pleasures were deemed out of tune with officially defined taste in a time where respectability increasingly favoured family relaxation. Governments and their agencies argued there was a need to transform the brutalising and demoralising nature of plebeian culture into something more wholesome that befit the genteel times.

So why did governments want to make the population more genteel? Gramsci argued that the elites needed to raise subordinate classes to a cultural level which “corresponds to the need of the productive forces for development, and hence to the interest of the ruling classes”. Great Britain was at the height of its economic powers in the 1800s. The rising mercantile class were convinced by the power of their civilising culture and wanted to raise the level of taste in the general population. The parliamentary State became involved in the provision of Art and the creation of libraries and museums. This prescription was known as rational recreation and Peter Bailey described how the concept acted as “an important instrument for educating the working classes in the social values of middle class orthodoxy”. Although he attributed it to humanitarian sympathy, rational recreation in practice was a desire to regulate amusement, policed by public opinion. The public in this sense were the middle classes. They would act as the fulcrum in the see-saw between the elites and the masses where “opinions travel upward, manners downward”. The upper classes would provide the necessary social regulation by giving universal access to the improving influence of their culture. But it hit insurmountable barriers of class. Whether the concept was humanistic, paternalistic or driven by economic necessity, rational recreation was mostly thwarted by fears that the common people might contaminate the culture they were supposed to partake of. Social distance was a key issue and recreation events became “uneasy parades along the class frontier”. Unless the working classes brought cleanliness and their own manners, they could not enter the venues of these supposed cultural transformations. This paradox between the desired improvement of the lower classes and the distaste of their manners blights much cultural policy to this day. Because culture classifies the classifiers, elitists continue to be driven by notions that they have to keep their culture pure in order to accentuate the differences between them and the hoi-polloi.

The culture of distinction has a critical role in defining the attributes of a national identity. National identity is an accumulation of customs, traditions and rituals. This key role of culture shows up in matters of taste, values and preferences. Bourdieu argued that cultural tastes and values are not innate but rather a product of upbringing and education and therefore reflect hierarchical standing in society. Specific knowledges are required to make sense of high culture and as a result many museums become the territory of what Bourdieu called the “dominated fractions of the dominant class”. Without the key to unlock and access high culture, those who don’t belong to these dominated fractions have switched off and see culture as something for other people. Regardless of whether museums have free entry or not, cultural consumption remains the preserve of the educated elite.

Although Australia has a reputation for egalitarianism and a “fair go” (reflected in the title of the 1996 Liberal cultural manifesto), like every other democratic country it has issues of hierarchy, elitism and unequal access to cultural consumption. Here as elsewhere, cultural policy has tended to reinforce existing norms and reinforce the nexus between culture and power. The ABC was instrumental in formally establishing cultural subsidy in Australia. It took its charter, its mission of enlightenment and its ideas about what constituted culture from the BBC. The ABC was legally obliged to play music but favoured the music of European High Art by becoming an entrepreneur of classic music concerts. The Australian Elizabethan Theatre Trust was an early arts funding body which took the view that local society was mostly made up of resourceful philistines and almost everyone outside Sydney and Melbourne was starved of culture. Just as in 19th century Britain, Australian elites thought they could ennoble the starved masses by infusing them with their view of culture.

The funding bodies responsible for disbursing arts and cultural public monies were staffed by cultural elites who promoted the concept of excellence as a single ladder of merit. This singular definition was strongly biased towards high arts, because excellence had to be judged and it was the elites themselves who were ranking the ladder of merit according to their own tastes. It was not until the late 1970s when it was seen as an unfair component of cultural policy and its philosophy was first challenged in Australian funding decisions. Rowse described an alternative model: decentralised patronage based on the concept of community. In this model, funding is not merely disbursed by a funding body staffed by like-minded, if well-intentioned, elitists who based decisions on their notions of excellence, but it is also distributed by other stakeholders such as community organisations who themselves can allocate funds as they see fit. This model was encouraged by the McLeay Report of 1986. The report quoted Donald Horne’s three cultural rights. These were; the right of access to the cultural heritage, the right to new art and the right to community art participation. This definition moved the judgement of culture away from excellence towards multi-layered criteria based on a wide range of cultural activities which do not conform to a single scale or hierarchy. Those who participate in it, define it. It is an example of cultural democracy.

But cultural democracy does not reform the existing framework of culture. The narrower definition of culture as a civilising force is persistent. Rather than accepting the idea of cultural difference, the policy makers continued to stress cultural disadvantage. This meant the existing priorities were automatically deemed legitimate and those who were constituted as cultural disadvantaged simply needed access to the civilising culture. By stressing disadvantage, it meant that the existing order of cultural priorities was not questioned. This concept, subtly different from that of cultural democracy, can best be described as the democratisation of culture. It is an approach which fails on two counts. Firstly, it does nothing to address the disadvantages. Policy-makers wrung their hands if people could not access this culture; as Gay Hawkins highlighted, exclusion was their problem. Secondly, and more importantly, it misses out on popular and progressive forms of mass-culture of more interest to a great majority of people. The democratisation of culture attempted to create a level playing field but not everyone understood the rules of the game and more still were playing on an entirely different field.

The 1995 Labour cultural policy manifesto Creative Nation is burdened by this contradiction. Its twin goals are democracy and excellence. But the criteria of excellence, and its acknowledgement of the improving qualities of high art, blunts the strategy for achieving cultural democracy. Bruce Johnson argued that rather than achieve democracy, the document served to close debate, confirm assumptions about the arts and reflect the conservative beliefs of the agencies of cultural policy. Johnson stated that the policy stressed the idea of centrality of culture and the notion that starved masses needed to be fed a homogenised criterion of excellence. Creative Nation does not challenge historical assumptions about the value of high art itself. The distinction can be clearly seen in the policy’s differentiation between high arts and plebeian pleasures. Whereas the classical Musica Viva program gets an additional funding of $2 million, contemporary music does not receive any subsidy despite being “the most popular and accessible form of cultural activity”. Similarly, although the policy acknowledges the Australian Opera as “thought by many to be elitist and inaccessible” it gets grants of over one million dollars to cover touring and wage increases. The policy also subsidises the State Orchestras with $700,000 of additional funding for their development of “imagination and creativity". Festivals and popular arts do not have the same kudos and receive no additional subsidies. They are only tolerated in the policy because, much like fairs in 19th century Britain, their economic benefit outweighs any prejudice the cultural arbiters might have on account of taste.

Another way in which the policy does not reflect cultural democracy is in its shabby treatment of the National Museum of Australia (NMA). The NMA was a recommendation of the 1974 Pigott Report to establish a national history museum that would be “accessible to all Australians”. The NMA does not have its own section in the policy and is discussed only in two small paragraphs under the banner of “australian institute of aboriginal and torres strait islander studie". The policy presents the museum as a virtual resource because it did not have a permanent home. The lack of funding to build a real NMA showed that Labor did not see great value in the museum’s aspiration to tell the story of everyday Australia. But although the Liberals supported it, they too were unhappy with its version of that story. When the building finally opened in 2001, it ran into a storm of political protest despite its humble aspirations. The Australian media found the displays were full of “sinister coded messages” that seemed to push a political agenda of “sneering ridicule of White Australia". Prime Minister Howard announced a review of the NMA and stacked the committee with fellow ideologues. Although the review exonerated the museum, the curator lost her job and many of the review items were changed to reflect the Government’s comforting idea of an-ever improving Australian culture. The changes meant the museum could avoid the notion that Australia’s everyday story was contested terrain. The museum became just another front in a much broader battle to eradicate dissent and impose compliance.

Therefore governments, by their cultural priorities, funding decisions and direct intervention, play a major role in determining the cultural agenda for the nation. Cultural policy is important and is a legitimate area of government interest. But the primary goals of cultural policy have not changed much in two hundred years. The high arts are supported so that they can bring about a transformation in the manners of the disadvantaged classes. Although policies have made some moves towards democracy, where all cultures are promoted relative to their ongoing activities within their particular life-conditions, the high arts continue to have funding disproportionate to their popularity. The vested interests of its participants, the economic and social muscle of the elites that support them, and the concepts of excellence than underpin them, all ensure that the status quo will remain. In the McLeay Report, Donald Horne not only defined the three basic cultural rights but he also stated that governments’ role in the arts is to secure these rights for its citizens. It is arguable that governments are failing on all three counts.