Australian Politics and Policy - Senior, 2019a

Victoria
and allow a diversity of private players into the market resonated in the political
debate. 25
The election of the Liberal–National coalition government headed by Jeff
Kennett in 1992 marked a period of intense privatisation in which few corporations
werespared,althoughitwasalsotruethatthepreviousLaborgovernmenthadbeen
forced to sell the State Savings Bank and had started the disintegration of the SECV.
Some of this had been done in response to pressure coming from the federal
Labor government whose treasurer, Paul Keating, was an advocate of privatisation
as part of his commitment to economic reform. The Kennett government’s
extensive privatisation was described by some as being the product of ideology,
butthenewgovernmentdeclaredthatithadbeenelectedtodealwithVictoria’s
burgeoning public sector debt and it was simply following through on its
commitment. 26
The initial purpose of the privatisation was to address the budget deficit.
Receipts from the sale of public corporations went to retiring debt. Privatisation
also sought to reduce the size of the state’s public sector workforce. Commencing
with the SECV and extending to other corporations, the government’s enthusiasm
for this approach extended to other areas of policy including corrective services and
local government. The reform of local government was quite extensive and involved
asuspensionoflocalgovernmentelectionsforanumberofyears.Otherchanges
resonated with the small government agenda, and included capping rate rises,
amalgamating councils and requiring councils to contract their service provision
functions out to private providers. 27 This reform hit rural councils particularly
hard,anditwasnoticeablethatacollapseinsupportforboththeLiberaland
National parties in regional and rural districts contributed to the unexpected defeat
of the Kennett government in 1999. 28
The state as co-ordinator
In the period between its re-election in 1996 and its defeat in 1999, the Kennett
government’s approach to the policy debate began to shift. Whereas debt retirement
was a primary objective in the previous electoral cycle, the government used its
second term to undertake some major public works. Arguably the most significant
of these was a major road construction project to connect various freeways by
tunnelling under previously sensitive locations such as the Royal Botanical Gardens
adjacent to the central business district. This project was constructed by a privately
owned corporation which was also able to charge tolls. The role of government
25 Woodward 1999.
26 Parkinson 2000.
27 Kiss 1999.
28 Woodward and Costar 2000.
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