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Decay in a Time of Penury

September 28th, 2008

Recently, I wrote in On Line Opinion of 19 September 2008 about the controversy swirling around the budget situation in New South Wales which contributed to the resignation of the Premier the Hon Morris Iemma who later resigned from Parliament. A new government was formed by the Hon Nathan Rees as Premier and he appointed a cabinet which did not include the former Treasurer, the Hon Michael Costa, who also later resigned from the Parliament, but not before an extraordinary media conference.

The summary of my article follows: “New South Wales is asserted to be facing a financial crisis necessitating a mini-budget. In fact the revised estimate of NSW State debt, at just under $8 billion, is miniscule and the overrun of $900 million in the recurrent budget – anticipated as a result of the shortfall in stamp duty on property – is near inconsequential. Cutbacks will drive the State further into real crisis in transport, schools and hospitals. The assertion that the State’s credit rating is threatened is mere intimidation.”

This article is not simply another venture in political controversy. There are substantial implications for museums and other cultural activities in the actions which might flow from the view which the former Treasurer and Treasury spokespersons have taken. A mini-budget which would substantially reduce recurrent and capital funding could see further reductions of staff at museums and other negative impacts. It is imperative that museum people and those interested in and supportive of museums understand that the statements on government budgeting by economically conservative politicians and media commentators fail to give an accurate picture of the situation.

As I say in the article, “Since the adoption by governments of the market or business model – in New South Wales by Harvard MBA graduate Premier Nick Greiner – there have been ongoing reductions in the operating budgets of government agencies through across-the-board cuts, non-funding of awarded salary increases and the notorious “efficiency dividends”.

I also say, “While over the longer term, sustained imbalances in recurrent expenditure are clearly unsatisfactory, there surely can be no risk assumed for occasional deficits. Indeed they are appropriate occasionally to even out overall performance. After all, reacting suddenly to declines in the budget position leads to retrenchment of staff who take with them skills and corporate knowledge which have cost a great deal to acquire. It is likely that the reductions have already gone too far in some areas.”

The details of any mini-budget to be presented in November 2008 are yet to become apparent.

Across the continent, it is possible that the new Western Australian Museum development on the site of the former East Perth Power Station, announced18 February this year by the then Premier Alan Carpenter, could be deferred. In his announcement Premier Carpenter said, ” the massive, half-a-billion dollar infrastructure project would be a stunning cultural and social institution for WA, which would tell the amazing stories of the State and its people in a building that would bring new life to a major heritage site.”

On the ABC Radio National Program, “The National Interest” of 26 September, new Western Australian Premier Colin Barnett mentioned that some capital projects – and he specifically mentioned proposed new museum, approved by the former government, would have to be reviewed. As the program’s presenter Peter Mares says, “And he’ll need all of the mining tax revenue he can get his hands on, if he’s to live up to his promise to up spending in regional WA – a non-negotiable commitment in his bid to keep his minority government in office.”

The Western Australian economy is booming because of the substantial resource projects; one could suggest that this is an appropriate time to invest in things like museums. It would be odd if Australia defers and downsizes its cultural projects when cities such as Medellín in Colombia are building libraries and art galleries in order to address poor education, poverty and crime amongst young people. Last year a number of media reports described these strategies by which mathematician and city mayor Sergio Fajardo was “turning blight to beauty“.

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