STEVE AUSTIN:
My next guest is a federal parliamentarian, I went back and read his first, his maiden speech to parliament and he said, and I quote; ‘My research has also taught me that good intentions are not enough. What we need in Australia policy today is not more ideologues convinced that their prescriptions are the answer, but modest reformers willing to try new solutions and discover whether they actually deliver results.’ The person that said that is Australia’s Assistant Minister for Employment, Treasury and Competition. He’s also the Charities Minister, and he’s in Brisbane this morning, representing the Prime Minister at the Queensland Volunteering Awards this morning at city hall. Andrew Leigh, lovely to see you back in Brisbane.
ANDREW LEIGH:
Great to be back with you and your listeners.
AUSTIN:
Do you remember giving that first speech to parliament?
LEIGH:
I do indeed. Those moments stay with you. You’ve got your family in the gallery there, your friends around you, so it’s great fun. It’s kind of you to take me back to that moment.
AUSTIN:
Why are good intentions not enough? What are you referring to there? I mean, you’ve got a PhD from Harvard, an MBA from Harvard, a couple of degrees from Sydney. You know, you’ve got a brain’s the size of a planet. So, why did you say that?
LEIGH:
This is really about making sure that we have a ‘what works?’ philosophy to government and public policy. Let me give you one clear example. It was thought for many years that infant simulators that cried every few minutes would deter teen girls from becoming mums. Until a randomised trial was conducted in Western Australia, which found that girls who had infant simulators were actually more likely to become teenage mums. Those putting together the infant simulators had all the best intentions, but actually their program turned out to work in reverse. Medicine is replete with examples of where good intentions have produced medicines that had no effect, or indeed sometimes ill effects. We need to do a better job at measuring things, and we’ve set up the Australian Centre for Evaluation in Treasury to start doing some of that work at the Commonwealth level.
AUSTIN:
I’ll come to that a bit later on. You once did a study that asked the question, are beautiful politicians more likely to be elected? What was the answer?
LEIGH:
The answer is yes and it may surprise your listeners to know that the effect is stronger for male politicians than female politicians, maybe because in the era we were conducting the study, which is about 15 years ago now, there was a stereotype that beauty and brains were incompatible for female politicians, and so beauty could be a double edged sword for female politicians and it wasn’t for male politicians. It’s another example, Steve, as to how luck matters a lot in politics. Politics is in the end, much less like chess and much more like poker. Lots of luck in the game.
AUSTIN:
Does this explain why Peter Dutton gets lampooned so much? Because he’s follically challenged as opposed to some other men in politics?
LEIGH:
The effect of beauty is very big for politicians who are unknown and basically irrelevant for politicians who are well known. You can think about this in a dating context. Looks matter a lot when you’re in a bar. They matter very little when you’ve been married to somebody for 30 years. So for politicians who are senior, really, we’ve got other characteristics to judge them by. We don’t need that heuristic shortcut of how good or bad they look.
AUSTIN:
Life is unjust. Andrew Leigh.
LEIGH:
It certainly is. And that should make us less likely to put the successful on pedestals and less likely to kick the unsuccessful into the gutter.
AUSTIN:
Given that you said we need in Australia policy today that is not more ideologues convinced of their prescriptions of the answer, but modest reformers. Explain to me the Future Made in Australia Bill a plan, I’m sorry, it’s not a bill a Future Made in Australia plan. Your government is spending billions on highly speculative programs. Why?
LEIGH:
Most of that money is going through tax concessions which only pay off if the investments come through. So, for areas like critical minerals and like green tech production, then that’s paying on success. Effectively, we need to do this because we’re in the midst of one of the biggest industrial transformations in Australia’s history, moving the electricity grid from a third renewables to four-fifths renewables in just under a decade. That needs huge amounts of investment from overseas. We’re not seeking to crowd out that private capital, we’re encouraging more private capital to be investing and making sure that we’ve got batteries, solar panels, critical minerals, critical medicines as well, that set Australia up for the future.
AUSTIN:
What is Australia trying to copy? The US Inflation Reduction Act, as it’s called, which is, I think it’s completely misnamed, but it’s a spending of billions and billions and billions of dollars on solar projects and renewable energy projects. Why are we trying to compete?
LEIGH:
Our focus really is on what works well for Australia. Obviously, we’ve got an eye to what’s going on across the world in Europe, in the United States and elsewhere, but really we’re thinking about how we get that net zero transformation for Australia. Moving to a net zero economy isn’t just something we have to do, it’s actually something that creates a whole lot of jobs and a whole lot of opportunities for Australia. I love Ross Garnaut’s idea of Australia as a renewable energy superpower. Chris Bowen and Jim Chalmers are moving around the country announcing things like offshore wind zones, new solar projects, that is creating new jobs and new opportunities for us to have manufacturing here in the nation.
AUSTIN:
My guest is Andrew Leigh. You mentioned before the Australian Centre for Evaluation. Will the Australian Centre for Evaluation be evaluating the Future Made in Australia program?
LEIGH:
It may look at aspects of it. It’s really an opt in program where we’re looking to collaborate across the federal government. I’ve reached out to a range of my federal colleagues and said, ‘what is there that we can rigorously evaluate in your space?’ Some things aren’t going to be amenable to doing a high quality evaluation. You can’t do randomised trials of everything. So, really, it’ll be up to those in particular sectors as to whether we find ways of doing more rigorous evaluation.
AUSTIN:
Criticism of the Future Made in Australia policy of the Albanese Government is that we’re competing in an area where we have the least advantage. Now, we may have had it in the seventies when Australia was a world leader in solar panels or solar electricity, but China now is able to deliver them at such ridiculously low cost that they’re dumping them on markets. They’re being used as barriers and fence lines in Europe. That’s how cheap they are. Not a joke, but actually true. That’s how appallingly cheap China can manufacture them. Why are we trying to compete? Or why we’re even sending taxpayer money to compete with China in this particular category?
LEIGH:
You’re right to go to the question of comparative advantage. As an economist, that’s our bread and butter, but Australia does have a range of comparative advantages in terms of the production of critical minerals, many of which are found here in Australia, and the ability to value add along that chain on things like batteries. In terms of solar panels, a lot of the intellectual property is coming out of Australian institutions such as the University of NSW and the Australian National University. There is an opportunity for us to be more, a greater part of that value chain. And, of course, we’re great users of renewable energy. There is about twice as much sunlight that hits Brisbane as Berlin over the course of a typical year. And that makes a big difference to the effectiveness of the solar industry.
AUSTIN:
What else is the government going to announce for the Future Made in Australia program?
LEIGH:
I mentioned before, medical technology. We’ve got opportunities to operate in niches there and the pandemic showed us the value of having onshore manufacturing capacity in the event that a pandemic strikes. We’re aware of the importance of finding those niches in advanced manufacturing where Australia can be a leader. We’re not going to be producing colour televisions in Australia, but there may be other niches where we’re able to find the comparative advantage that you so rightly talked about before.
AUSTIN:
In the most recent sitting of federal Parliament. I think it was the federal government’s Digital Identification Bill, or Digital ID Bill, passed through. The Bill apparently aims to secure convenient, voluntary and way to verify a citizen’s identity for use in online transactions with government and businesses. Now, it was passed without going to the vote. What is the government’s intention with the digital identification system that you’re asking Australians to sign up to?
LEIGH:
This is a voluntary system. Let me give you a couple of examples where a digital ID might be handy. Imagine a new mum who’s just had a baby and needs to sign up for a customer reference number to get government support. Rather than having to wrap the bub up and take all the paperwork down to a government office, she’s able to use her digital ID in order to sign up online—
AUSTIN:
But that’s already there now…
LEIGH:
The digital ID makes it possible…
AUSTIN:
It’s there though…
LEIGH:
Imagine somebody…
AUSTIN:
That’s what the Medicare number’s for.
LEIGH:
Steve, the framework that you’re talking about exists through the digital ID system. Or imagine you want to apply for a rental property.
AUSTIN:
So, let me rephrase my question. What does the new digital upgraded digital ID system do that the previous one did not do? Like Medicare numbers or tax file numbers or social security, all those sorts of things. There were already these numbers. What does this new system do that didn’t happen previously?
LEIGH:
It’s about verifying your identity. So, you have to verify an ID to get a customer reference number. You have to verify ID to get a rental property. So, right now you have to photocopy a whole lot of forms and have them often notarized in order to apply for a rental property. That goes out the window with a digital ID. If you choose to apply for one, then you can use your digital ID and you don’t have to share those confidential documents with the real estate agent.
AUSTIN:
And you’re going to allow private businesses access to this system?
LEIGH:
By allowing them access to this system, Steve they no longer have to get access to the documents themselves. That gives you a greater level of privacy. Or imagine what happens to somebody after a flood in which their documents are destroyed. The digital ID allows them to apply for support straight after the flood in an environment where otherwise they would have to find another way of proving their identity. So, it’s got a whole lot of use cases within government, within the private sector. It’s private, voluntary and secure. It does allow Australians a more straightforward option of proving who they are without having to physically hand over those documents every time.
AUSTIN:
I can see the convenience and the advantage of it, it makes many of my listeners feel very, very nervous. It sounds beyond Orwellian. Andrew Leigh, how do you see it? I mean, you can see Cory Bernardi, who no longer in politics, expressed concern about it. Bob Katter, the Katter Australia Party member, just today expressed in a statement, concern about sort of a continuing erosion of loss of freedoms is how Bob Katter sees it. Does it make you nervous at all?
LEIGH:
It doesn’t, Steve, and that’s because it’s purely voluntary. We’re not demanding that people opt into the digital ID. We’re simply saying that in an era in which there have been hacks on private businesses and some of these documents have been stolen, think about Latitude Financial or Optus, that you might want to use a digital ID so your documents aren’t shared as widely. So, you have a single government repository where your identity has been proven and private businesses are able to tap in and say, ‘is this person really Steve Austin?’
AUSTIN:
Doesn’t it put all, I take the point about the documents, but hackers are still getting access to all this information through other means, aren’t they? They’re hacking everything. And if you put them all in one nice, simple, easy database with a nice number to get through all these barriers, doesn’t that make it easier for hackers?
LEIGH:
Certainly this site would be an attractive target, and that’s why we’ve put huge amounts of resources into making sure that it is highly secure. But it’s safer, Steve, to have your documents locked up in a single place where we’re putting a lot of resources into cyber security, than to have them all over the place, floating around the web where hackers can hack into real estate agents, into private firms and get your documents and then steal your identity. That’s the problem which is cropping up every day. We’re investing in the anti scam centre, investing in making sure we’re keeping Australians safe around identity theft. But we’re also putting in place the digital ID to reduce the number of spots, places of vulnerability.
AUSTIN:
I have to let you go to the volunteering awards at City Hall. Thanks for coming into the studio, Andrew Leigh.
LEIGH:
Real pleasure, Steve. Thanks for having me.