Time’s up for

CALLS last week by the University of Tasmania’s Richard Eccleston and prominent economist Saul Eslake for the Giddings Government to use this year’s Budget as an exercise in reducing the size of government are vital.

If these calls are not heeded by the political class in Tasmania, the state will sink further into the fiscal mire.

Mr Eslake, chief economist for the Bank of America Merrill Lynch in Australia, said last Thursday that the Giddings Government and the Liberal Opposition had to look at cutting the number of schools and end the scandal of having three major hospitals for a population of just over 500,000.

Mr Eccleston, a political scientist, predicted that without hard reforms, Tasmania’s budgetary situation would become untenable. Both were supported by TCCI chief economist Phil Bayley, who observed correctly that the Giddings Government had seemed to have forgotten about spending restraint.

The education and health budgets are cases of Tasmanians living high on the hog despite the self-interested bleating of doctors and nurses about how hard things are in the hospital sector. However, Premier Lara Giddings, to her credit, embarked on the process of change in these areas in her first Budget in 2011.

But look what happened: Ms Giddings proposed closing schools. She was let down by the jelly-backed Education Minister Nick McKim, who did an about-face after getting a little bit of heat from the predictable opponents of the changes – parents, teachers and opportunist political opponents. Instead Mr McKim did what Tasmanian politicians love to do because they have little by way of leadership courage – got a committee to look at the issue and promise no forced closures.

That is the same process the Labor Government has presided over in Tasmania in relation to council mergers and guess what, there has not been one merger occurring in that process.

On hospitals, Health Minister Michelle O’Byrne has stuck to her guns, but there has been no bigpicture change of that sector.

Because of the corrupting and corrosive influence of parochialism, people in Burnie and Launceston think they should have a relatively speaking rolled-gold public hospital like Hobart. It is a scandalous waste of money and completely unsustainable.

As Mr Eslake said last week, Tasmanians might have to get used to driving to get services they expect.

Doctors in the public health system in Tasmania, as this column revealed last year, take a big salary from the public system while maintaining their private practices.

There is no incentive for them to work harder because they are not paid per number of procedures.

There also needs to be a restructuring of government departments, something which has not happened since the 1990s.

The Department of Economic Development, an interventionist body dedicated to handing over taxpayer money to corporates, should simply be abolished.

Economic development is achieved through government policy-setting in areas such as taxation, infrastructure and labourmarket flexibility.

Privatisation of government entities in Tasmania is a must when it comes to economic reform. Why does the government own a bus company called Metro Tasmania?

Governments around the world have got out of the business of transport because the private sector does it better and it’s not core government business.

The same argument applies to power companies – Hydro Tasmania and Aurora should both have been sold when the brave former Liberal Premier Tony Rundle proposed this in the 1998 election, but which was opposed by the Labor opposition at the time.

There is also a compelling argument for privatising water. The knee-jerk reaction of the economic left and its bedfellows is that water is a human right and therefore must remain in government hands. Yes