How this election might change us in ways we can't yet see

Colin James for the Otago Daily Times on the “other election” 14 November 2011

In behind the campaign slogans and headlines is another election. National and Labour in different ways want to change the way we think about some important issues of our time.

This is not the deep, dark skulduggery the two big parties accuse each other of to scarify voters: a secret National plan to sell all the trading enterprises and leave us skint or a Labour plot to kidnap and dump us, bankrupt, back in the 1970s.

It is more a reflection of something we do know is going on but can’t yet readily see in our politics: the rise of a new generational majority, the Xs and Ys, with different preoccupations, ways of thinking and ways of doing things.

First, National. When TV3’s The Nation interviewed State Services Minister Tony Ryall on plans for reform of the public sector, he mostly talked up efficiencies and the role of the private and “third” (not-for-profit) sectors.

Ryall was right, up to a point: there is a big efficiency drive, including digitisation (aiming for a more open, engaged public service), shared back-office services, joint purchasing, benchmarking of administrative arrangements, including accommodation, and private sector competition in some activities. Efficiency is one way departments do “more with less” on Finance Minister Bill English’s tight leash.

But there is much more coming. Ryall only touched on a broader “better public services” project.

This is not a secret. There is a website and a group of senior departmental chief executives and three from outside the government. Prime Minister’s Department boss Maarten Wevers heads it. Treasury Deputy Secretary Andrew Kibblewhite coordinates it.

Its aim is big changes to the public sector.

Over time efficiencies will deliver less of the “more” in “more with less”. At some point departments will deliver “less with less”. Some already are.

English has been there before, when a new MP 20 years back. The result was an angry electorate. Hence the “better public services” group and his challenge to it to think outside the box — not just the New Zealand box but the world box. If that succeeds, the result could be as ground-breaking as the 1980s state sector reforms.

Among the ideas is “best sourcing” of providers, determined by the government for specialist services (example: prisons) and by consumers for services provided directly to citizens (example: rest homes), not necessarily on price and maybe involving various ways of “payment”.

There is a new go at judging departments by the effect they have — “outcomes” in the jargon. Past attempts have failed. One idea: outputs (what departments do) set at high-level or in big groups. That would likely require new sorts of contracts with staff and between departments and the “third” sector. The four-year budgeting that next year replaces annual budgets for departments might help.

A third group of ideas is to find better ways of working across departmental lines: for example, clustering departments or specific activities, with more flexible funding lines and maybe overseen by superministers (for example, Steven Joyce clustering economic development, science and innovation and tertiary education).

That might all sound esoteric. But it could change our public services significantly and perhaps profoundly. And it will start happening next year if National is in office.

That is part of the “other” election.

Another part is an actuarial-based investment approach to social policy. John Key and English applied that to their policies on youth unemployment and benefits generally.

The headlines on the first were about cards that could be exchanged only for goods and on the second were about forcing mothers of one-year-old children out to work. Out of sight of the headlines Key and English were changing the thinking — and were explicit about it when asked.

Their line was adapted from ACC practice by the Welfare Working Group. Chair Paula Rebstock saw it as a very important part of the group’s report in February.

The idea: work out the cost of a young person going on the dole out of school and never or hardly ever getting off it, then calculate a return on “investment” in action that gets that person capable of doing and holding down a job. The same goes for long-term beneficiaries.

It is serious “welfare” reform, trying to base policy on rigorous financial evidence.

Labour applied the evidence approach for its children-first election policy, first floated by Annette King last year — but in King’s case the evidence is scientific.

It comes from the Dunedin longitudinal study, backed by work on epigenetics and nutrition by Sir Peter Gluckman, that the months in the womb and what a child eats and learns and experiences in its first months and years of life determine much of that child’s later capacity to learn and, as a teenager then adult, to make a way in life.

Very early childhood is when opportunities are maximised or damage is done. The later remedial action is left the more expensive it is, the lower the success rate — and the lower the return on investment.

So Labour has promised universal enrolment in the Well Child programme of mothers before birth and babies after birth and monitoring of how well they are doing, with action when needed. That is much deeper than just extending Working for Families and other payments and potentially carries a bigger long-term return. It is explicitly called an “investment”.

There is also a cross-party logic. Key appointed Sir Peter his chief scientist and has declared he wants his legacy to be what he does for disadvantaged children. Ryall in announcing free after-hours doctors visits for under-6s, said: “All children deserve the best possible start in life.” King uses almost exactly the same words. But what to do? That requires science, not ideology. Sir Peter again. He has been assembling a group to push that to officials and ministers.

There is another dimension. The return which investing in early childhood promises — fully-employable, taxpaying citizens — is five or more election cycles down the track. That’s not exactly politics as we usually know it and as it plays out on the hustings.

Neither is announcing steps now to deal with the fiscal poison the baby-boomers are cooking up for the 2020s. Labour has proposed raising the superannuation qualifying age from 65 to 67 between 2020 and 2033.

It is a seriously soft promise and includes leaving the age at 65 for those who can’t work. So it is a policy long on concept and short on bite.

Its importance is that it reflects a generational shift in the Labour caucus. As those younger generations take over in the next term or two and the issue becomes one of intergenerational (in)equity, expect to see Labour policy firm around the retirement age. The same will go for health services, where in the policy just announced there is only a faint hint of the need for deep rethinking. National will follow in time.

Innovation is another intergenerational issue. Governments’ short-changing of innovation over two decades is a big part of the reason we are not as well off compared with other rich countries as we were. Labour upped its game in May. Watch to see how far National goes beyond its recent promise to double the size of Industrial Research Ltd (a Crown research institute).

The rising generations expect things to be different from the way their baby-boomer parents wanted it. The next generations expect goods and services to be customised. The public service and policy will need to change to meet this expectation because mass-produced services from a “factory” state won’t. English’s “better public services” drive is not coming out of thin air or a brainwave or only because money is tight. It reflects a generational shift in attitudes.

The elections from 2008 to 2014 mark this generational change. So it is no surprise that in this election some deep currents are running. But by definition deep currents don’t generate the ripples on the surface that catch sunlight and attention.

Look back in five or 10 years and you might be surprised what you have voted for in this “other” election on November 26.