At the outset of the second term of the Labor Government, we may reasonably ask: What policy innovations will the prime minister and his colleagues bring forward?

Will they remain as timid as they were in the first term? They need to be reminded that the neoliberal era is in its death throes, leaving devastated economies, fractured societies, divided polities, and ruined lives in its wake. It’s time for an entirely new approach to public policy.

Confounded by neo-liberalism’s dishonoured promises, and deceived by social media and conventional news outlets championing its fake claims, many voters turned to false idols like Donald Trump in the US, Nigel Farage in the UK, or Giorgia Meloni in Italy. (In Australia there are similarly duplicitous types, though they lack the extensive “base” of Trump et al.: think of Barnaby Joyce, Pauline Hanson, Clive Palmer …). But the times are (at last) changing. Voters are demanding a new approach to public policy. This is particularly true for younger voters.

The neoliberal attack on the state crippled its crucial role as a vital innovator in the social and economic life of the nation. The Harvard social theorist Theda Skocpol warned about this back in 1985, just as the neoliberal attack on the state was cranking up. Professor Skocpol highlighted the critical role played by “states as actors and as society-shaping institutional structures". Her subsequent research has shown how governments and their bureaucracies have initiated far-reaching reforms — some progressive, some regressive — in society and the economy.

For the state to become a progressive public policy innovator demands a highly professional public service. Instead of focusing on its regulative functioning, the bureaucracy needs to prioritise its innovative functioning. Regulation is, of course, necessary, but it has to be nuanced, sensitively applied, and always secondary to the leadership that the state must provide in recovering from the devastations of the neoliberal era. It has to be staffed by officers with high levels of expertise who can articulate policy ideas and services in-house_,_ not handing these responsibilities over to costly private consultancies with dubious conflicts of interest.

High-performing officers should be resourced to think outside the regulatory box and not have their proposals haughtily dismissed (or worse, appropriated and then scaled back) by unimaginative superiors. The hierarchical structuring of public service departments needs to be flattened. Talent, not seniority, or political connections, must always be the source of advancement. Recruiting strategies for the public service must focus on attracting graduates ambitious for meaningful career paths, rather than a job in the corporate world in which the interests of CEOs and shareholders have priority over the well-being of their staff and their clients.

With a public service renowned for the excellence of its officers, public policy must be strategically focused on creating a first-class public sector in the economy, one that can vigorously compete with the private sector. All the fake neoliberal talk about level playing fields has been a deliberate smokescreen to enable the private sector to devour the public sector, to relieve the private sector of serious competition, especially in the provision of services essential for the well-being of the nation.

This first-class public sector has to be developed in direct competition with the private sector. This is the most effective way of regulating the latter, without having to resort to endless tangles of bureaucratic red tape. It will require the strategic placement of public enterprises throughout the economy, charged with delivering public goods and services of the highest standard, free from shareholders’ demands for profits, tax breaks and dividends. Fees for those public goods and services will need to be means-tested, with low or no fees for the unemployed, pensioners, etc., while providing robust competition with the private sector. Some public goods and services will, in fact, be profitable (for example a publicly owned bank), hence providing a healthy revenue stream for the national budget.

The first cab off the rank for a first-class public sector must surely be the establishment of a publicly owned bank, to compete with the near monopoly power of the four privately owned big banks – power which they grimly wield entirely for themselves. From 1912 until 1991, Australia did have a highly successful, publicly owned bank: the Commonwealth Bank of Australia. It was introduced by the Labor Government of the day to compete with the ruthless rent-seeking of the private banks. It was very popular and highly successful. At the height of the neoliberal madness in the 1990s, it was privatised (by a Labor Government!). Today it is the biggest privately owned bank in the country, serving the interests of its managers and shareholders while posting billions of dollars in profits each year. If ever there were a need for a public bank to give all four of the big banks a run for their money, it is right now!

Paralleling the establishment of a public bank must be the development of a public real estate commission, to compete with a private sector that is excessively costly, sometimes worryingly duplicitous, and a major contributor to the country’s housing crisis. The commission should not simply have an entrepreneurial role in the buying and selling of properties, but should also be the major housing construction agency in the country, providing architecturally designed housing of the highest quality, much as the former South Australian Housing Trust constructed so successfully, before it was subsumed into the state’s Department of Human Services.

A comprehensive public health scheme is an urgent necessity for the country. Based on an enlarged Medicare (for example, by adding dental care to its services), and drawing on ideas from the British National Health Scheme (when it was properly resourced), all primary health care agencies should come under the umbrella of an Australian public health commission, one that includes a specialist arm to compete with the many medical specialists in the bloated private sector who charge fees well in excess of what the majority can afford.

Other public goods and services must include the education sector, adequately resourcing government schools so that they can truly compete with the excessively funded private school sector. A national law commission is also desperately needed to compete with the big law firms whose fee structures absolutely ensure justice is way beyond the reach of most citizens. There are many other areas crying out for reform: progressive taxation reforms, aged care, early childhood education, closing the gap for Indigenous Australians – the list goes on. The challenges are immense, that much is certainly true, but none is incapable of resolution by dedicated and intelligent thinkers and activists.

It’s time.

The views expressed in this article may or may not reflect those of Pearls and Irritations.