Job cuts: do they stand up against pre-election commitments?

Back in 2011, Tim Nicholls MP was defending then extra-parliamentary leader Campbell Newman‘s refusal to cost election promises at the time. The ABC reported, in June 2011:

“Deputy Opposition Leader Tim Nicholls has defended Liberal National Party‘s (LNP) Campbell Newman “economic vision” for Queensland, saying the party will release detailed policies closer to the election. Mr Newman gave a speech at a business conference yesterday on the Gold Coast outlining his vision for the state, but it was void of specific policies and costings.”

The ABC went on to report:

‘Today, Mr Nicholls reiterated that the LNPs details and costings will be released later. “We will be releasing the details of the plan but now we’ve said where we want to be, which is what we were talking about [yesterday],” he said. “Then as we get closer to the election time, we will be releasing the policies where we will explain how we’ll do that.”‘

True to his word, Mr Nicholls did release costings later, on 22 March, 2012. In doing so, he gave Queenslanders one and a half days to review the costings before voting. At the time, the ABC quoted him as saying that savings measures would include restricting public sector growth. ‘Mr Nicholls says the LNP’s plan involves “managing both the size of the public sector and the wages outcome”,’ the ABC reported.

Mr Nicholls’ own press release, which accompanied his costings documents (release around 2.30 pm on the 22nd of March), stated:

Mr Nicholls said the LNP was determined to deliver a public service that was affordable and grew in line with community need. “The LNP is offering public servants long term job security and the removal of the wage cap in return for managing overall growth,” he said. “We want neither a big nor a small public service – we want the right sized public service. We will work with unions and the Public Service Commission to ensure front line services provided by the likes of police, teachers, doctors and nurses are revitalised to deliver the outcomes Queenslanders expect and deserve.”

The words appear to have been carefully-chosen, to give the impression of job security, particularly for those in the front line services. But the literal meaning of the words is the opposite of the impression they are designed to give. In the short term, while public service growth is “managed”, there is no job security. The likes of police, teachers, doctors and nurses do not have their jobs assured; taxpayers are merely assured that the services provided by “the likes” of them will be “revitalised”.

The costing document itself makes further comment about “public service growth”. The relevant section is part 3, “Sustainable Public Service Growth”. It starts by comparing public service growth, over the past four years, with economic growth. It speaks of the state’s low annual economic growth over the past four years, compared with public service growth. The paragraph omits any mention of the twelve-year period, up to four years ago, when Queensland’s growth outperformed Australia’s growth, and omits any mention of the significant growth-limiting events of the past four years. The most recent Queensland Government annual economic report deals with the most recent of those events as follows:

“Financial year 2010-11 represented one of the most difficult for the Queensland economy in recent history. Domestically, the State was hit by heavy rainfall from September 2010, which was followed by widespread flooding at the start of 2011, and then Cyclone Yasi in February. The international environment was also a challenging one. Political turmoil in North Africa and the Middle-East from late 2010 pushed up world oil prices, adding to domestic inflationary pressures from the floods. Sovereign debt concerns intensified in Europe and the US, which led to increased volatility in financial markets throughout the world. Meanwhile, tragedy struck Japan, traditionally Queensland’s largest trading partner and a key element in the global supply chain, with the earthquake and tsunami taking the lives of thousands of people and severely damaging Japan’s infrastructure and economy. Reflecting these adverse events, Queensland’s economy grew a marginal 0.2% in 2010-11.”

These events, and events of preceding years (like the global financial crisis), are causes of lessening economic growth but are also largely reasons why government expenditure should increase. Infrastructure and services are needed in the wake of economic and natural disasters.

The introduction to part 3 of the costing document emphasises public service growth without talking about any of the reasons for it. (Possum Comitatus has a good piece on the increase in public sector workers, on Crikey.)

The graph that immediately follows that introduction seems to bear no relation to the content of that paragraph. It shows “economic growth” at 1%, despite the reference to an average 2.7% growth in the paragraph that precedes it, though perhaps the graph refers to a different period. It’s hard to tell as the graph’s period is not expressly stated. More strangely, the graph seems to compare “private wage growth” with “public service employee expenses growth”. Wage growth and expenses growth are two different things. This “comparing apples with oranges” approach is unhelpful. If you compare apples with apples – you see that in fact private sector wages have long grown faster than public sector wages – as Possum Comitatus’ piece says:

“In other words, Qld public sector wages grew faster than the national public sector average, but grew slower than Qld and Australian private sector wages and are still less than the national public sector average.”

The balance of part 3 of the costings document uses the same types of phrases as appear in the press release. It also makes this express commitment:

“Consistent with Campbell Newman’s public commitment in December 2011, the LNP is committed to removing the 2.5% wage cap on public servant pay while allowing natural attrition to return public service growth to a sustainable level over the next four years.”

A lot of the jobs that have already gone were filled by people on temporary contracts. That sounds fairly innocuous if you don’t know that it is common, in Queensland’s public sector, for people to be on rolling temporary contracts over periods of many years. So, it would seem to be a stretch to say that a failure to renew such contracts is a form of natural attrition. But even if ‘natural attrition’ could be read as meaning non-renewal of temporary contracts, cutting 14,000 positions would seem to fall outside of the scope of that phrase.