By Brendan O’Connor*
In the October ’98 edition of Local Government FOCUS a report from the ‘CT 1998 Competing Solutions’ Conference gave the reader the impression that compulsory competitive tendering had been an unqualified success, producing unprecedented efficiencies and improvements to Council services.
Closer scrutiny of the CCT juggernaut in Victoria, however, allows plenty of room for another general conclusion. That is that the savings made have come from massive cuts to the staffing levels and employment conditions and which consequentially has led to the reduction of the quality and quantity of services.
Furthermore, that these savings in a broader sense are more than offset by significant overt and hidden costs to all Councils and the community as a whole.
There seems almost to be present a conspiracy of silence about what is going on around the place. As an opponent of the CCT legislation I do not even try to argue against the proposition that savings have been made. I do not refute the fact that cutting staffing levels and coercing employees to concede their employment conditions for fear of losing their jobs have produced monetary savings. Nor would I contradict the contention that if you reduce the minimum dietary requirements of a ‘Meals on Wheels’ dinner it will save a dollar or two.
In the strictest of accounting terms I suppose its okay for the industry to declare savings if it retrenches 10,000 Australian workers, as occurred in Victoria between 1994-98, and shift a large proportion of the future costs of these former employees onto the Commonwealth Social Security system as they struggle to find work. But is this the ‘Clever Country’ at work? And is the community that pays the taxes and looks for work the beneficiary of CCT?
Consider, by way of example, the story of the Local Authorities Superannuation Scheme (LASS). As the Victorian industry scheme it had the reputation as the best funded scheme in the public sector. As thousands of its members were retrenched as a result of CCT and were capable of claiming early retirement the LASS had a financial blowout of more than $400 million in four years.
And how did the proud architect of the CCT legislation, the State Government, respond to this crisis? It lifted Councils capped rates and told them they were responsible for the Superannuation scheme and would have to, if necessary, bail it out.
Over the last four years there have been many conferences debating the pros and cons of the CT and I think on some occasions there has been genuine discussion. But all too often the forums are filled with the smallest sector of the industry that have been the beneficiaries of the changes, who chant the ‘CCT is good’ mantra and vilify critics as either fools or heretics.
Apart from the capacity these managers have to receive large payouts and then take up another manager’s role in the industry they also have the chance to receive bonuses often at the expense of their employees’ conditions and staffing levels.
Is it any wonder that a significant proportion of them give unqualified support for this pernicious and coercive policy? By the way the recent abolition of CCT in the United Kingdom has left only the State of Victoria with such a policy, imposed unilaterally by one Government upon another.
*Brendan O’Connor is Assistant National Secretary of the Australian Services Union and Chairperson of ASU National Local Government Division.
