06 August 2010

Crikey on the Orgill Report

In today’s edition of Crikey Canberra correspondent Bernard Keene has a fair and balanced piece on the just-released interim report of the independent inquiry into the school building component of the government's stimulus package, which found that the program "is delivering much-needed infrastructure to school communities while achieving the primary goal of economic activity across the nation".

Keene’s concluding paragraphs are worth quoting in full:

But this is the nub of the issue: like the rest of the stimulus package, the schools program was intended to deliver jobs, and fast, in the face of economic meltdown. To that extent, the program delivered in spades. Based on its consultations with industry, the inquiry concluded "the BER provided the construction industry with a significant economic stimulus which prevented many construction organisations from reducing staff and/or the size of their operations to match an otherwise decreasing workload resulting from the GFC. Some indicated that without the work generated by the program they may have had to cease operation."

Rather than being judged from the point of view of construction companies that might have been forced to shut down, the program is being judged with the luxury of success, in which we continue to enjoy strong employment, which was propped up by the government's support for the retail and construction sectors.

But even judged against normal capital works standards, the schools program appears to have been remarkably successful, with less than 2.7% of projects generating complaints.

The schools stimulus program has been under sustained attack from the right-wing media and the ABC, who have continuously claimed the program is wasteful and a "debacle". Like the ANAO report in May, this interim report discredits this campaign comprehensively and in detail. And like the ANAO report, this review will be misrepresented in those outlets.

I can only add a comment along the lines of the one I made in Managing the GFC, citing Joseph Stiglitz: whatever waste might have occurred in the rollout of the stimulus package, how much more wasteful (indeed “reckless”) would it have been to allow mass unemployment to develop?

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