In the desperation of WWII, Australia established a department of post-war reconstruction that drove far reaching change in how the country was governed. After the jolt of the pandemic, a similar department could be an engine room of a new type of government.
Australia has a model for what could happen, one that ought to be dear to Albanese’s heart.
As the historian David Lee has pointed out, Labor prime minister John Curtin established a department of post-war reconstruction in 1942, in the middle of a war at a time when Australia was in its most desperate hours. Its job was to plan for the sort of society, and the sort of economy Australia would be when the war was over, whenever that would be. Dr Nugget Coombs was the first head of the department, which reported to the Treasurer, Ben Chifley. Later, after Coombs went to head the Commonwealth Bank, Fin Crisp, who was later a professor of political science at the Australian National University headed it.
Its genesis, and its genius, had its roots in the aftermath of World War I. Australia was ruined and wrecked by the war, and by the soon-following Spanish flu. There was no economic upsurge capable of providing decent and dignified jobs to the thousands of Australians returning from overseas service. Many who had fought abroad had disabilities from gas or wounds.
Soldier-settlement schemes foundered, mostly because too little land was provided, often to families without the capital or the experience to weather hard times. Within a decade, the nation was in deep depression, with up to 30 per cent of the population unemployed.
Curtin had seen the social and economic misery. He was determined that those who served in this second war would have something good to come home to. First was employment. An economic and political consensus developed around the idea that the central function of government economic activity was the maintenance of full employment. That was a consensus that lasted for 30 years.
But not just full employment. Where would Australian men and women who served, or the millions of other Australians whose work had supported them find dignity and work in a renewed civilian economy?
At this stage, all Commonwealth economic activity was focused on the war. But the department, which never had more than 30 public servants, was discussing the establishment of a social security system, including new social welfare payments. It was planning housing schemes and the recreation of a building industry after massive supply-chain shortages.
It developed policies for Reconstruction training schemes which saw thousands of returned forces trained at universities and technical training colleges. Thousands more (including my father) settled on farms under far more equitable soldier settlement schemes. It became involved in international negotiations, including the Bretton Woods agreement which laid the framework of international trade and peace for decades. It thought about tax. It had a finger in the pie of overseas trade, general economic policy, and proposals for constitutional change allowing the Commonwealth more power over health and social security.
It had plans on northern development, town and regional planning, water conservation and irrigation (including the seeds of the Snowy River scheme). Its staff worked with public servants from other departments, with state governments and with industry over the revitalisation of manufacturing industry and primary industry, industrial relations and the coal industry. And with population policy and the post-war immigration program, and reconstruction in Papua New Guinea. From the work it stimulated came the Australian National University and the car industry.
The department was initially involved in establishing some of the wartime economic and social controls, and, later, with planning orderly demobilisation and the dismantling of controls. One of its initiatives, which ought to be re-established, was the Commonwealth Employment Service.
Many of the activities it had planned were passed to others for implementation. We have the vestiges of them still.
The very establishment of the department created a new professionalism in public service, and, as with the New Deal in the United States, stimulated some of the nation’s best and brightest minds into the idea of a single nation, the public interest and a revised national optimism of the sort that had faded from about 1914.
Even more than Treasury, it recruited talent and established much of the primacy of economics in modern government. Of course, many of its activities were mildly socialist in tone, reflecting the enthusiasms of a Labor administration. It was likewise with post-war reform in Britain, which saw the setting up of the National Health and social security. But the Australian schemes were never doctrinaire, and only once flirted with nationalisation, as it turned out unsuccessfully.
Many of the public servants associated with it, including many of the so-called Seven Dwarves, became trusted advisers to Menzies and his successors.
When Menzies came to power in 1949, he abolished the department, and many of the remaining economic controls, including petrol rationing. He took its economic units into Prime Minister and Cabinet and established from the rest the department of national development.
One would not, could not, recreate this body, even if one could gather personnel of its calibre in the modern public service.
But the jolt of the pandemic, and the model it provided, could be an engine room of a new type of government. One that was “over” the rorts and abuses of the Morrison government and which was focused on honest, open and accountable administration, providing fair and equitable access to government goods and services.
But also, in re-imagining how modern government, with its access to technology, computers, communications and a well-educated workforce, should be organising health care and education, including with efficient and accountable sharing of functions with the states and territories. And not necessarily through public servants as such, even if it must contemplate that much of the privatisation, much of the contracting in and out, and much of the use of consultants, has not proved a successful form of stewardship of public resources.
Such a venture would mean, if it were to be credible, much much more than setting up a few working parties in different agencies, some token consultation arrangements with groups of tame rent seekers or involving the as-yet-not-fleshed out idea of the public service having an in-house consultancy.
It might involve a body such as the productivity commission, which did much of the spade work on a national disability scheme. It ought to have actual working responsibilities, not mere advisory functions.
The establishment of such a body in remaking Australia after the traumas and the disruption of the pandemic ought to be right up Albanese’s street. Maybe from affection for Labor mythology – because post-war reconstruction is at the heart of the reputation of Labor saints, Curtin and Chifley. Or from the obvious good sense the reimagining of a government and a public administration suited to modern times and great national purposes. It might even constitute a form of social contract over a do-nothing budget.
John Waterford AM, better known as Jack Waterford, is an Australian journalist and commentator.
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