Trust in Politics: Who Cares?

The Hon Mike Baird is the New South Wales Treasurer in the Barry O’Farrell Government. And Minister for Industrial Affairs. He has been the Member for Manly since 2007. Before standing for parliament, Mike Baird worked in banking with the National Bank of Australia and with Deutsche Bank and HSBC Australia On Thursday 14 October 2013, Mike Baird addressed The Sydney Institute on the non financial topic of trust and integrity in politics.

TRUST IN POLITICS

MIKE BAIRD

Tonight I want to discuss the current level of trust in politics in Australia. Why is trust important? What can either support or erode it? And how can we restore it?

What I am going to suggest is that the relationship between elected representatives and voters is much like any other human relationship. It thrives on trust, and withers in its absence. As in any relationship, the keys to trust are consistency, honesty, and being able to talk and listen.

On the question of whether voters trust politicians, my view is that only a decreasing number do, and there is plenty of objective data to back me up. Research released by Monash University and the Scanlon Foundation last month showed trust in the federal government had hit a new low. Based on 6000 responses to a survey, the Mapping Social Cohesion report found only 27 per cent of people thought the federal government could be trusted, down from 48 per cent the last time the survey was conducted, in 2009. Surely governments should sit much higher than this on any scale of trust.

While the survey was depressing news, it was hardly surprising, particularly for those of us who follow the somewhat less rigorous annual Reader’s Digest survey of the most trusted professions. The 2013 version has politicians sitting at 49th out of 50, sandwiched between insurance salesmen and door-to-door hawkers.

As to whether trust in politics actually matters, I think the matter was succinctly put by a team of US and British researchers in a paper at the London School of Economics earlier this year. In their paper, Why Do Voters Lose Trust in Governments?, Paul Whiteley and David Sanders (from the University of Essex), and Harold D. Clarke and Marianne Stewart (from the University of Texas) wrote:

A certain amount of distrust in governments is actually a desirable thing in a democracy, since the willingness of ordinary citizens to monitor their governments is an essential part of the democratic process. However, when mistrust of politicians and governments becomes endemic, the concern is that this will make governing much more difficult. Citizens who comprehensively mistrust their governments are unlikely to give their consent to essential policies. Such distrust is likely to have other effects as well, such as weakening tax compliance and even undermining the norms which underpin the rule of law. So a reservoir of citizen trust is an important requirement for a healthy democracy.

This accurately sums up my concern: that as a government you are unlikely to have the capacity to deliver your essential policies if you don’t have trust.

As far as the collapse in trust in the federal government, between 2009 and 2013, is concerned, you don’t have to look beyond the promise by Julia Gillard that there would be no carbon tax, followed by the introduction of one after the 2010 election. This is, in my view, the first principle of trust in politics: be consistent in your words and actions.

Gillard’s collapse mirrored the experience in NSW of Morris Iemma, who vowed before the 2007 election Labor would not privatise electricity generation. They spent most of the next four years trying to do precisely that. To take an example from our side of politics, there are numerous commentators who have suggested John Howard sacrificed some of the trust he had built up with the community when Work Choices appeared in 2005, rather than as part of the 2004 re-election campaign.

These examples contrast of course with Howard’s introduction of the GST. A new tax is never popular, but he argued it on every street corner during the 1998 campaign and was elected with that mandate. Trust was maintained on the way through. A similar case is that of New Zealand Prime Minister John Key, a wonderfully pragmatic conservative. Key said before his first election in 2008 that he would not be selling any publicly owned assets, and he didn’t. However, in 2011, he sought, and received, a mandate to privatise 49 per cent of New Zealand’s largest electricity business. Key worked with the community and maintained his bedrock of trust with them.

NSW Premier Barry O’Farrell has learned the lesson of these examples. He made a commitment before the 2011 NSW election not to sell the electricity “poles and wires”, and he has stuck to it, insisting such a change would require a mandate. That’s gone a long way towards rebuilding trust.

It also builds trust if you maintain consistency in your policies, so that they align with your values. This was shown by Howard in opposition, when he supported the Keating government’s sale of the Commonwealth Bank. While some colleagues urged Howard to deny Paul Keating the financial benefits of the sale, his response was: “If we follow good policy and good principles, the politics will take care of itself.” Howard understood that to oppose something on one side of an election and support it on the other erodes trust.

There are admittedly some shades of grey here. Economic shocks happen, and when they do you need to quickly redraw your priorities. But as an overall principle, being consistent in your policies and your values, regardless of the political cycle and the challenges you are facing, will hold you in good stead.

A further principle that works to maintain trust is an element of “long-termism” in policy. This is tricky for politicians – the temptation is to deal with the opportunities and challenges in front of you, which will link you in to the daily media cycle. The natural inclination at any point of the political cycle is to want to see results as quickly as possible, so the public can see you are doing things.

What loses traction in this process is the long-term interest of the community. An example of longer-term thinking by the NSW Government is the introduction of several pioneering social benefit bonds. Such bonds are a way of bringing new capital resources to social problems, and to focus the approach to those problems strictly on outcomes. We currently have two bonds running that focus on kids who are at high risk of being removed from their families. When kids are separated from their families, the cost to the community is enormous, and we have encouraged private investors to come in and share in the savings should targeted programs, delivered by non-government organisations in the field, yield results.

In terms of any political opportunities, it will be long after my term as Treasurer before the community sees the full benefit, which will take a generation to flow through. But I believe trust is built up when you are providing platforms for long-term results. And I am happy to give due credit to former NSW Premier Kristina Keneally for kicking off the discussion of social benefit bonds in this state.

In order to rebuild trust, I think we also need to be prepared to have an honest conversation with voters. The community is crying out for this. People want an honest assessment of what the problems and challenges are, and how government plans to fix them.

Take the example of Newcastle, where urban renewal has been talked about for decades. Five months ago, we told the people of Newcastle we were prepared to do something about it, including a new light rail system for their CBD. But in a constrained fiscal environment, we were honest enough to link it to a long-term lease of the Port of Newcastle. Privatisations are rarely popular, but this position has garnered overwhelming support in Newcastle. People there are saying, “While we don’t all agree on the lease of the Port, we can at last see the money being secured and we all want the revitalisation of Newcastle.” The previous approach would have been to announce $5 million for a study and put out a map.

Finally, the media can also play an important role in building and maintaining trust.

A year ago, when the state’s Auditor-General highlighted problems in financial reporting, and did so using colourful language, the media had a field day with the story, and I received a real kicking. Fine: that comes with the job. But did anybody happen to notice that the Auditor-General came out with a subsequent annual report last month in which he noted the number of significant reporting errors had halved, and gave the state accounts their first unqualified audit in over a decade? I’m pretty sure you didn’t, because it did not attract a centimetre of coverage in the press, or a second of coverage on radio or TV.

This improvement was the result of unbelievably hard work by hundreds of public servants over the past 12 months. I’m not saying every initiative of the government should get a pat on the back in the media, but in terms of being able to trust the government to manage its financial reporting, the community has been left with only one side.

I’ve avoided talking tonight about the recent Independent Commission Against Corruption hearings in Sydney, but it goes without saying that such behaviour undermines trust in government for a long time. The challenge I’m talking about here is for honest, hard-working, community-focussed MPs from all sides to rebuild trust with voters, and to use that as a springboard for improved public policy and reform. Those that accept that challenge will be acting in their own, as well as the community’s, interest, because any government that maintains trust is also well on the way to maintaining government.