Prioritise policies to boost prosperity

businessman standing in front of wall of post-it notes

Prioritise policies to boost prosperity

Australian governments would be better at policy reform if they prioritised their agenda better, according to a new Grattan Institute report, Prioritising a government’s agenda.

The failure to prioritise has been identified as one reason for failings of the Rudd Government, the Abbott Government, and the Shorten Opposition.

‘Governments need to steer a middle course between doing good and political reality,’ lead author and former Grattan Institute CEO John Daley says. ‘If a reform both serves the public interest and is wildly popular, then it has usually happened already.’

Political capital, ministerial time, and the bandwidth of the public service to design and implement policy are always scarce, and the public has limited tolerance for change. Governments that are more methodical in prioritising their agenda can use their scarce political capital better.

Yet governments in Australia do not publish sophisticated approaches to prioritisation. They rely too much on the budget process, which has limits as a mechanism for prioritisation. Budget processes tend to lead to too many initiatives at once, underplay reforms that pay off over the longer term, and don’t pay enough attention to the limits of political capital.

Governments should look for the reforms that will make more of a difference while minimising the political cost. This means assessing both the value and feasibility of potential initiatives.

Governments should be more articulate about the breadth of the valuable ends they serve. While rhetoric tends to focus on economic growth, there is little dispute that governments are also trying to improve health, education, public safety, social connection, the environment, the scope for individual choice, and cultural identity.

The biggest stumbling block to prioritisation is not disagreement about what is a valuable end, but how to trade off these ends.

Weak supporting evidence, strong opposition (including from political opponents, interest groups, and the public), and complex implementation all make a reform less feasible.

A disciplined assessment can often identify some reforms as much more valuable than others. And an ordered assessment may flag some reforms as more feasible.

Governments should prioritise a small number of reforms that are both high value and more feasible, and therefore worth the investment of the substantial political capital that is usually needed to get big reforms over the line.

‘This kind of disciplined prioritisation is the key to maximising prosperity – and perhaps even to maximising the chances of re-election,’ Professor Daley says.

‘Our research shows that governments in the first 20 years of this century completed fewer of the important reforms on the slate than in the 1980s and 90s. Better prioritisation is one of the keys to doing more of the reforms that matter.’

/Public Release. The material in this public release comes from the originating organization and may be of a point-in-time nature, edited for clarity, style and length. View in full here.