Privatisation in Australia is the process of transiting a public service or good to the private sector through a variety of mechanisms that was commenced by the Federal Government in the 1990s, receiving bipartisan support. More generally, privatisation is a set of economic policies that is part of a broader system of deregulation of government services, underpinned by the ideology of Liberalism, in order to achieve economic outcomes of growth, efficiency and productivity. Some examples of sectors that have been privatised include finance, telecommunications and infrastructure. Australia's public service has also transformed with the introduction of New Public Management (NPM) in the late twentieth century which altered public administration models to appear more "business-like" through performance evaluations that emphasise efficiency, productivity and service delivery. Another definition of privatisation is reliance on "more on private institutions and less on government, to satisfy people’s needs”. The concept of privatisation can be construed in a narrow or broad sense. The narrow scope of privatisation is portrayed as the sale of public goods, while the broader understanding of privatisation involves the transfer of "ownership, management, finance and control" of public goods to private actors. Historically, the Australian government played an influential role in society as the idea of a strong state was prevalent to the Australian story since Federation. This changed in the twentieth-century, as Australia's adoption of privatisation as a set of government policies, reflected the rise of privatisation across the Western world, specifically in the United States and United Kingdom. The Australian experience of privatisation involves substituting government ownership, provision and funding to the private sector, in an attempt to liberalise the economy. The effectiveness of such policies is contested, as the motivations of privatisation are widely debated.
History
The greatest influence on privatisation in Australia were the policies of the Thatcher government, who “unleashed a wave of privatizations that transformed the economy” and became a model for other Western economies. Unlike the rest of the world, Australia's privatisation program was relatively early as it first commenced in the 1990s, under the Hawke Labor government. The New South Wales state government began the process of privatisation earlier than the federal government, in 1989. Australia's first act of privatisation occurred in 1991, when the federal government sold the Commonwealth Bank of Australia, followed by the partial sale of Telstra and Qantas, all of which were significant national icons. The sectors most affected by privatisation in the 1990s, were finance, electricity and transport, estimating profits of up to $61 billion from both federal and state privatisation policies. Consequently, Australia became second ranked in the world for privatisation profits, employing one of the most comprehensive programs, the effects of which are continuing to impact the economy.
Hawke-Keating government (1983–1996) The Hawke-Keating Labor governments were instrumental in implementing deregulation policies that resulted in modernizing Australia's economy. Emerging industries replaced traditional ones that suddenly became non-competitive, as productivity in the finance, education and legal sector increased, as real wages grew concurrently. The decision to transition the Australian Dollar to a floating exchange rate in 1983 increased stability and confidence in the economy, as part of the deregulation program, that laid the foundations for a modern economy. While privatisation is supported by neoliberal ideology that stipulates less government intervention in the economy, Australia's history of privatisation was initiated under a Labor government, which appears to defy Labor Party policy objectives. However, during the Hawke-Keating years, there were attempts to remove the ideological underpinnings of the debate on privatisation, as the approach taken by the government was "more about a pragmatic choice" to modernise and open the economy to international markets. Prime Minister Hawke said, "The difference between us will be one of ideology. That will distinguish us from the opposition (Liberals)." Hawke was rebuking the charge that Labor had abandoned its commitments to public ownership and enterprise, while highlighting the need for economic rationalism in order to address pressing economic problems. The consensus-style leadership of Bob Hawke enabled structural economic reforms, through the Accord struck in 1983 between Labor and the Australian Council of Trade Unions (ACTU). This accord brought together various stakeholders from unions, welfare organisations and the business community, to secure a mandate for market-oriented economic reforms, while remaining committed to social progress.
Howard government (1996–2007) Privatization was implemented by successive governments, including the Howard government in 1996 to 2007, which saw record rates of continuous economic growth, a testament which economists attribute to the economic reforms of the Hawke–Keating government. Economists indicate the continuous rates of economic growth were not the result of Howard's policies of privatization, but rather, to one of the world's biggest booms in the mining sector, where investments rose from 2 to 8 percent of GDP. The difference between privatization under Hawke-Keating and Howard governments, is argued to be one of ideology, however this does not suggest the Labor Party was not divided on this issue and continues to be. Privatization remained part of government policy through the twenty-first century, as it represented a form of economic rationalism.
Types of privatisation The following methods of privatisation are common for governments to employ:
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