Good deal or bad,
secrecy keeps voters in the dark

November 3, 2006

The Government represents voters in public-private partnerships but keeps the terms secret. Without disclosure, talk of accountability is empty rhetoric.

IMAGINE you need building work done that's big and complex and is going to cost you a lot. You want it done properly and for a fair price, so you appoint an agent to act for you. You were unhappy with a previous agent, you warn, who refused to show you how the figures added up, or even how competing bids compared — "commercial in confidence," he said, as if somehow you weren't involved at all in the deal. The new agent comes back and tells you he has done all the calculations and clinched a wonderful deal with some mates, "the best value you could get". Just to be sure, you ask to see the promised paperwork: how do the figures add up, and how do they compare with the alternatives? Sorry, that's not how the deal works, comes the answer, but it's in your best interest — trust me, I'm from the Government. That is basically what the Bracks Government has said about public-private partnerships.

Seven years after Victorians' concern about arrogant, unaccountable government tipped the balance against Jeff Kennett, Steve Bracks and his Government are also prepared to treat the public as mugs while doing billion-dollar deals on their behalf. Since 1999, the Government has entered into 16 PPPs to develop and in some cases operate infrastructure. These include the Southern Cross Station, EastLink freeway, Melbourne Convention Centre, the County Court, Melbourne Showgrounds and the Royal Women's and Royal Children's hospitals. While long advocating the need for such infrastructure, The Age has felt bound to condemn the withholding of details needed to assess whether these are good deals or not.

The secrecy goes far beyond the ambit of patents and trade secrets that Labor promised in 1999 would be the limits of "commercial in confidence" provisions. The Labor-dominated Public Accounts and Estimates Committee last month reported to Parliament that, as a result, Victorians could have no idea whether these deals represented value for money. More than 30 pages cut from the report have come to light, and these raise awkward points about showpiece projects. The report, even minus these pages, concluded that secrecy about PPPs had "diminished the accountability of government … for substantial state expenditure". Lack of transparency and reliance on a "limited pool" of expertise gave rise to potential conflicts of interest. Long-term contracts could "lock in" future governments to poor decisions and bad deals.

Embarrassing questions about several PPPs have been raised without proper responses — is it that the answers are more embarrassing? One thing we do know is that the state can borrow more cheaply than anyone else — a triple-A credit rating is not just a Noddy badge. A private sector project has to be much more expert and efficient to offset that cost advantage, plus make a profit. Yet a well-structured PPP may still, in some cases, be able to deliver better results sooner than publicly funded infrastructure, where shortfalls have resulted from competing political priorities and public resistance to fund-raising through state taxes and debt. Although ideology is a factor in this debate, critics on both the left and right agree that the public should not have to rely purely on a government's say-so that a PPP is a good deal. In today's Age, the executive director of the Institute for Public Affairs, John Roskam, puts the free-market case for transparency to ensure PPPs do benefit the public.

Less than a month before the election, Treasurer John Brumby has belatedly promised more information about future deals. Yet the proposed release of full "value-for-money statements" and "public interest statements" within three months of a PPP deal being closed still falls short of the Labor Party's own platform, which calls for value-for-money statements within a week of project disclosure. In projects of such importance and cost, the Government needs to win the community's confidence and support for them. If details are kept secret, then their public benefit will remain open to doubt. PPP contracts must be good enough to withstand public scrutiny. The public pays regardless — whether through taxes, tolls or other business charges. All parties seeking a four-year contract with voters on November 25 must offer a better deal on PPPs.

China must face more pressure on executions

EACH year thousands of people, from corrupt petty officials to violent murderers, are executed in China. As the Chinese justice system is shrouded in secrecy, the exact number is unknown but it is estimated at 10,000. Sixty-eight crimes attract the death penalty, including offences such as embezzlement that result in comparatively light prison sentences in Australia.

For the Chinese Government, capital punishment too often serves a purpose that has little to do with justice. It is a tool for maintaining political control and discouraging corruption among Communist Party officials. Capital punishment is always barbaric; in China, it is routinely swift as well. Unsurprisingly, miscarriages of justice are common — such as the case, documented by Amnesty International, of a man executed for murdering his wife, who reappeared some time after his death.

According to Human Rights Watch, China has more documented executions than the total for the rest of the world. In the lead-up to the 2008 Olympics, the Chinese Government has faced intense international pressure to improve its human rights record. It was heartening to learn this week of a small but significant change. From next year, all verdicts imposed by provincial courts pronouncing the death penalty will be reviewed by the Supreme People's Court. The expectation is a substantial reduction in the number of executions.

This is a welcome development but it is just the beginning. China's recognition of the need to amend its policy is evidence that a concerted effort by the international community can effect significant change. As a signatory to covenants on civil and political rights that call for the abolition of the death penalty in all nations, Australia must continue to take a strong stand against capital punishment, wherever it is practised.