Newman could do better

Employee expenses increased by an average of about nine per cent per annum, with wages growth rising by about five per cent per annum with growth in employee numbers accounting for the remainder.

When expenses growth consistently outstrips revenue growth, as it did during the latter years of the Beattie-Bligh governments, the certain eventual outcome is budget deficits spilling over into borrowing as government seeks to maintain its high-spending momentum.

And so from the best fiscal circumstances in the country, with low taxes, efficient service provision, budget surpluses and minimal debt, Queensland's position markedly deteriorated with the results being an increasingly uncompetitive tax position, inefficient services and a bloated public sector, ballooning debt and the worst budget bottom line in the country.

It was the issues of the falling efficiency and quality of state government which Newman campaigned heavily and subsequently won a resounding mandate from the Queensland public to fix.

With public sector employment costs representing the largest operating cost item in the Queensland state budget, it is prudent that the government seek redundancies in areas which do not provide sufficient value for money for the ever-burdened taxpayer.

Just like households and businesses that ensure their budgets remain in check, the vigorous search for expenditure efficiencies should be at the core of what any competent government should regularly perform as the steward of public finance.

By contrast public sector unions will not countenance any reduction in public sector employment under any circumstances, regardless of the state of the budget.

This might be a populist position, but is a disreputable one in public policy terms when the short term objective must be to consolidate the budget and trim public sector size providing more room for private enterprises to grow.

Even so, the Newman government has already bowed to union pressure to some extent and there is worrying speculation that it will do so again in light of the latest opinion polls.

During the pre-election campaign the Liberal-National Party vowed not to privatise government assets during the current term, in deference to the union position at the cost of policy flexibility.

The reluctance to privatise is not defensible, especially when this approach could provide sales revenue to plug the budget gap and when privatised assets can be operated more efficiently in response to market forces.

To date only 4,000 redundancies of largely contract workers in a state public service of over 200,000 people have been achieved, however the Premier has now hinted that the total public sector employment cuts could be considerably less than the originally miniscule 20,000 target.