Turnbull ministry tweaks quietly demolish Abbott’s policy agenda

Environment & Energy: a Lycra Free Zone.



When it comes to steady-as-she-goes reshuffles, it’s the subtle and incremental details that denote the real direction of the Turnbull ministry agenda for the parliamentary term ahead.

That’s the take-out from the official cast list for ‘Turnbull 2.0’ after the Prime Minister survived a near death election after ruthlessly efficient negative campaigning from the Opposition inflicted far more damage than anticipated.

Jobs and Growth? Most incumbent Ministers have kept their jobs, but there’s is anything but growth in government numbers essential to make policy into legislation.

And you have to look right to the very end of the ministry list to see Turnbull’s real stamp of innovation.


Renewed Energy

Listed literally last in the July 2016 class list, Victorian MP Josh Frydenberg has picked up what’s arguably the most eye opening ministry: Environment and Energy.

The combination of those two policy areas under a single minister is clearly intended to send a firm message to stakeholders, industry and public servants. The message is this: what previously may have been opposing policy views must now pull together for a common good and a shared destiny. Sectoral cooperation must succeed sectoral conflict.If Tony Abbott went out of his way to punish the renewables sector through funding cuts and policies that favoured traditional energy sources like coal, gas and petroleum, Turnbull’s message is that both energy policy and industry needs look to a low emitting future to stay relevant.

Sectoral cooperation must succeed sectoral conflict.

If Tony Abbott went out of his way to punish the renewables sector through funding cuts and policies that favoured traditional energy sources like coal, gas and petroleum, Turnbull’s message is that both energy policy and the energy industry must look to a low emitting future to stay relevant. That’s not so dumb.

That’s not dumb.

Previously the portfolios had been split into Energy and Resources linking extraction, mining and generation while the development of the renewables industry was kept at bay by placing it in the Environment portfolio.

Resources – read extraction and mining – now goes to ascendant Nationals Senator and former Barnaby Joyce staffer Senator Matt Canavan who also picks up the Northern Australia ministry for his talents and ambition.

It’s a prescient move given the very public opposition of many farmers and Nationals to the encroachment of mining interests and polarising industries like Coal Seam Gas onto agricultural land.

There is also a strong implicit message that any political debt owed to the mining industry following its relentless and generously funded anti-Mining Tax campaign during the Coalition’s time in Opposition has been fully extinguished.


All regions are local

Another Nationals winner is Senator Fiona Nash who – very logically – gets Local Government added to her duties alongside Regional Development. Local Government – which ministers to more than 500 Mayors under the thumb of state governments – had previously rested with Paul Fletcher, who now gets to devote his full concentration to Urban Infrastructure.

Again, there’s a consistent theme in the new grouping of ministries along metropolitan and non-metropolitan lines.

Having outlined a new federal interest in a coordinated approach to the development of cities and major infrastructure – think rail or major urban renewal – Turnbull has arguably returned policy for regional councils to a better fit.


Coordinating Infrastructure

Although still in the outer ministry, Fletcher’s talent for understanding complex and technical industries and infrastructure can now be put to full use rather than being drained by distractions like unpopular local government mergers on his own doorstep.

Fletcher’s role in demonstrating and selling Turnbull’s vision of cooperative federalism on the ground to voters – think opening roads and bridges – should also not be underestimated.

Fletcher’s outer ministry also dovetails much more neatly with Angus Taylor’s Cities and Digital Transformation duties and provides two capable, younger and forward-looking junior ministers to help deliver coordinated national policies in areas that were previously largely left to the states.

If both Taylor and Fletcher make headway, it will help Turnbull deliver on an agenda of national renewal and new industry creation that has so far proved evasive.

The federal Local Government ministry didn’t even get named under Abbott.


Defending votes

South Australian MP Christopher Pyne’s move to Defence Industry Minister is about the strongest reflection yet of the urgent need to reinvigorate job creation in industrial sectors in transition.

Pyne’s shift out of Industry, Innovation and Science (which goes to Greg Hunt) to building submarines, ships and warplanes may not be overtly upward, but it does underscore a rock solid intention to ensure that states like South Australia benefit directly from massive industries like military procurement in terms of jobs.

Change management isn’t always sexy, but it’s crucial.

Pyne’s other big challenge will be to ensure that big projects help create sustainable local industries like advanced manufacturing that can replace big losses in sectors like car building by spreading opportunities for local growth around, rather than just buying new kit off the shelf.

The mission statement is clear: remake Defence into an industry that actually contributes to the economy rather than merely feeds off it. Shake down a few military industrial multinationals while you’re at it. That’s no small task.


Revenue and Financial Services

One of the real surprises in the mini-reshuffle is the replacement of the title of Assistant Treasurer with a sharply more contemporary post of Revenue and Financial Services – a role that goes to Kelly O’Dwyer who cedes Small Business to Michael McCormack.

Fairly or otherwise, the relinquishment of one O’Dwyer’s previous ministries is certain to be regarded by many as a loss for the minister who remains in Cabinet.

That interpretation could be missing the bigger policy picture.

In recasting the former Assistant Treasurer ministry into a far more hands-on position, a capable plumber to ensure that the effectiveness of taxation works for the government and not against it isn’t a glamour job, but it’s prudent.

In a digitised economy, where the physical location of payments and transactions have been routinely moved to minimise Treasury’s take, the development of effective revenue measures and mechanisms that tap into electronic commerce occurring in Australia remains a key challenge.

Coupled with endemic transfer pricing and other tax minimisation techniques – of themselves part of the wider financial services market – it’s arguable a fully dedicated plumber minister unencumbered by other distractions has a better chance stemming revenue leakage.

Given the Australian Taxation Office has already indicated it wants to eliminate the annual ritual of taxpayers filing an annual return through an agent when they have relatively simple affairs, an increase in the efficient targeting and collection of taxes could pay off in spades.

If the likes of Google, Apple, Uber and other disruptors start paying the same level of tax locally as the industry players that came before them did it’s unlikely to hurt the Turnbull Government or O’Dwyer.

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