Elected to the Victorian Parliament after one of Labor’s worst defeats, Steve Bracks won an election when Labor had been written off. Sam Dastyari talks to Steve Bracks about his eight years as Premier and his recent work protecting automotive manufacturing. Sam began by asking Steve about taking power.
- By Sam Dastyari
DASTYARI: Going right back to the start to the days before victory, how did you see the circumstances surrounding what was deemed by the media as an unexpected win?
BRACKS: We came out of 10 years in government between 1982 and 1992 under John Cain and Joan Kirner. It was a good sound government that lost its way in the last couple of years and when the recession hit, it didn’t have the capacity to respond to it. In the end it ran up significant debt, got involved in difficult industrial relations issues and went out with a legacy that was demonised by Jeff Kennett. That gave him licence to bring in a radical agenda, one of the most radical Victoria has ever seen.
We had a larger number of privatisations in Victoria than any other state in Australia. Electricity generation, transmission and retail outlets were privatised. The public transport system was privatised and franchised out. They tried water but stopped at the last moment. They set about cutting into the budget, cutting police, nurses and teachers and significantly downgrading services. But Kennett didn’t stop there.
He also attacked democracy by gagging debate and bringing new rules to stop public servants from speaking out, closing down freedom of information and hounding out the Director of Public Prosecutions because he criticised him.
He was seen as a strong leader – strong on economic management – and certainly the view was that Labor was so bad that we wouldn’t be elected for another term.
DASTYARI: To what extent were your colleagues demoralised?
BRACKS: We were down to about 27 seats. A majority of those were people who had served as ministers in the last government. We had very little new blood coming through. I came in a couple of years after that in a by–election. John Brumby was already there. A very able person who was brought in was John Thwaites, and later Rob Hulls. It was that nucleus of people who worked with a single–minded attitude to leave no stone unturned in getting back. We would go and convince the Party to preselect good people and to start building a policy base for Labor.
DASTYARI: Kennett won the next election. Was it just too soon for Labor to come back? BRACKS: Yeah, they ran the same campaign that they ran when we lost in 1992, calling us the ‘guilty party’. But this helped our election win in 1999 because they were still running a campaign reinforcing images of the past Labor government and getting people to vote against it. They weren’t really promoting their government. So in 1996 we won three seats and lost one. But more important was what the election meant for the ruling group of the party, Labor Unity. I had come in with their support in a seat in Williamstown, so did John Brumby and Rob Hulls. John Thwaites didn’t, but he had support as an independent coming in. Labor Unity made it that good people had to be selected in as many posts as possible. So we had controversy about past ministers losing their seats in preselections, and new people coming like Lynne Kosky, Bronwyn Pike, Richard Wynne, John Lenders and a whole range of people. That controversy was good because it showed the public we were changing. We had to show we were changing, not just in personnel, but in policy. We went through a significant debate in the party about privatisation and we decided not to buy back electricity and public transport.
DASTYARI: Was there a push in the Party not to do that?
BRACKS: Of course. There was a whole faction set up in reaction called ‘The Pledge’. But we said we’d draw a line. We couldn’t afford it if we wanted to improve education or public safety. We couldn’t use our resources buying back the farm, when we could use them better in fundamental service delivery. But we would regulate those assets that had been privatised to ensure there were fair outcomes and strong competition. That was a battle, the internal battle in the Labor Party, which we ran, conference after conference. The controversy showed we changed policy. It also showed that the party organisation became mature. We watched what had happened in NSW, historically a robust organisation that could raise money and seek support to run a campaign. We didn’t have a good resource base so with John Lenders as Secretary and myself as Shadow Treasurer we set out on an active fundraising campaign to resource democracy and we got probably the most significant private sector contribution in that period.
DASTYARI: Is that surprising? Because the perception always was that Kennett was so loved by the business community?
BRACKS: That was a misconception. Kennett was loved by segments of the business community that he favoured, but you were either onside or you were demonised. There was a whole sector of the business community that felt left out because they crossed the government. This was a vindictive government that took no prisoners. Now some might admire that factor, but it gave us an opportunity, so we put the argument that good government required strong opposition and you couldn’t have a strong opposition without being resourced.
In 1999 we ran a campaign which – although it looks modest now – was worth $8 million. We almost got to half of the Liberal campaign budget. We were back in the game and that helped us enormously because we spent it well. I would say the key is those three things: the people, the policy and the organisation. They were the three things that worked and we couldn’t have won in 1999 if any one of those slipped off the cliff.
DASTYARI: The actual campaign wasn’t one you were expected to win.
BRACKS: No, we weren’t. We knew from internal polling we would win a swag of country seats because the further people were out from Melbourne the more neglected they felt.
DASTYARI: There was a perception he cut the regions to fund the city.
BRACKS: He closed hospitals, he closed train lines, some schools and he had a philosophical belief that if he grew Melbourne it would eventually trickle down like veins in your leg to your toe nails. There was resentment from that, so we built a campaign and John Brumby and myself campaigned in country Victoria and won a swag of seats. We knew we were going to win a lot of those, but we didn’t think we would win as many as we did.
DASTYARI: How did you define yourself as Opposition Leader?
BRACKS: What I brought to the leadership was a philosophy that we weren’t going to follow Kennett down every burrow and just be the last paragraph of every story that was written. We would be where he wasn’t, we would have policies that he didn’t and we would answer questions that Victoria had, including what sort of government we’d be. We’d be a government that managed the budget well and gave back the benefit of that budget in better education, health and public safety resources; a government that had a plan for each of the regions to develop their economies; and we’d be more open and accountable, and restore some institutional checks and balances.
DASTYARI: Your periods of government coincided with a generation of state Labor leaders. What do you think made us so successful as a statebased organisation?
BRACKS: I believe it was a superior public policy offer, which was rooted in the history of two governments. One was the Wran Government of NSW and the other were the Hawke and Keating Governments. That history was replicated in the states. That meant managing well, including managing the budget well, and giving back the proceeds to the people. But the precondition was managing well.
DASTYARI: A criticism of the movement is that there is no ideology behind it, but I think that it was actually deeply ideological, which effectively saying that our people need better services.
BRACKS: It was ideological. Those people criticising and saying it was a managerial government misread it. The fact that it wasn’t their ideological position is probably more to the point. It wasn’t based on the old notion of owning the means of production. It was really saying that fundamentally we can provide greater opportunities and more equity to people. We could only do that if we were managing the economy and the budget well. It was an ideological position, it was a strong and robust one but it was different to some of our predecessors in Labor governments after World War II – although in Victoria we didn’t have many of those.
DASTYARI: You talked at the time about knowing when to get out and it’s obviously something a lot of leaders, including John Howard, failed to understand. When did you know it was time?
BRACKS: I had the view that when I was elected as Premier it was confirmed that at some point I wanted to move on when we had a strong and robust team who could take us forward. Now that sounds altruistic, it was also good for me personally. I felt that after three election wins – two of those the biggest majorities Labor’s ever had in Victorian history and one that any government has had in Victorian history – we had a strong team that hadn’t had any significant scandals, our ministry was intact, the economy was running well, the opposition not travelling well. It was time to go.
DASTYARI: In your time in government what’s the thing you look back on that you are most proud of?
BRACKS: I am most proud of some of our environmental achievements, in particular the proclaiming of the Great Otway Range National Park – the biggest coastal national park in Australia. We removed logging which occurred in that park, paying out $80 million and now we’re seeing 10 times more jobs created in tourism, hospitality and recreation in that area. We’ve protected that reserve for all time.
DASTYARI: I’ll use that as a segue to move to the car industry. How can you argue the transition out of the logging industry was a something you’re proud of, yet you have also played a role in defending car tariffs? You did the report for the government on the car industry, do you see it as sustainable?
BRACKS: I do, I think it’ll be sad day when we don’t have a high-value auto industry in Australia. That doesn’t mean we will have the same industry. But if we lose the capacity to have the private sector design, research and development sectors as we do in GM Holden, Ford and Toyota, we lose our engineering skills, which are transferable into aeronautics, as we do some of the work on the Joint Strike Fighter and the A380. Or if we lose some of our engineering skills which are transferrable into ship building or some of the heavy mining industry, which we utilise out in the auto industry and sell on to PNG and other areas, it would be a very sad day for Australia. The view I took in reviewing the auto industry was similar to the view John Button took when he reviewed it – there is significant spill over of the industry into other parts of the economy. But it can’t be kept unless it changes. The change he made was to reduce the tariff barrier from 50 percent down to five percent. We’ve continued that and I recommended that it go to five percent and it did.
DASTYARI: Some people argue the President of the United States is the Chief Executive Officer of General Motors.
BRACKS: You’re right, but it’s one of the great Obama achievements that he now has GM and Chrysler back making a profit and employing people after they’ve effectively gone into bankruptcy. But the Chief Executive of GM said to me at the time ‘if you were starting again you wouldn’t have a car industry’. The reality is that Australia’s base case for having a car industry and continuing is the fact that we already have it. Many countries have given away the car industry and said ‘can we start again?’ They can’t. What we’d be giving away if we gave away the car industry is a significant engineering and design base which we couldn’t replicate. The moment we gave away the car industry – the 1,000 designers and engineers at GM, the 1,000 at Ford the 500 at Toyota, all the training and support they are given and all the work they do designing cars – the moment we give them away is the moment we start losing bids for aeronautics and engineering, the moment we lose ship-building and all the engineering required for that, the moment we fully import everything, including the assembly of some of the heavy mining equipment. We would become a service-based economy with some agriculture, and does Australia want to become that? Not many people know this but cars are our biggest non–farming export: bigger than wheat and bigger than wool. At its height it was $6.5 billion, its now $4 billion worth of exports each year.
DASTYARI: What do you drive?
DASTYARI: There’s been some conservative opposition to this subsidy.
BRACKS: I think they’ve got themselves into all sorts of difficulty. The reality is if they were in government and one of the car companies was to go bust, they would be blamed for pulling out subsidies. DASTYARI: Do you think they will pull out subsidies?
BRACKS: No, I think they’ll change. If they get into government they will change. I’m sure of that.
DASTYARI: You’ve spoken about the need for sustainability. Do you think its heading towards that?
BRACKS: Yes I do. You are seeing the three new sustainability models that each of the car companies have coming through, from the Green Car Fund that Australia has supported, but also from their parent companies’ resources. The hybrid Camry that was made in Melbourne will become one of the fleet cars in Australia and elsewhere. The new Ford EcoBoost can effectively cut off cylinders when they’re not being used to save petrol and energy. GM are doing the Holden Cruze, which is now selling about 30–40,000 units. So you are seeing the redesign happening, and we all wish the car companies had done this earlier and quicker. There is a change now that wouldn’t have happened without government support. I can guarantee you now that if the Rudd and Gillard Governments had not supported the auto industry then GM and Ford would have left our shores by now, though Toyota may still have been here.
When GM went into bankruptcy they went through every subsidiary they had around the world. They sat with the US Treasury and they went through it. They went to Canada and they closed a few plants, they closed a few plants in South America, they came to Melbourne and said ‘well the government has a plan and they’re backing it, we’ll continue here,’ and they went on to consider another subsidiary. If the conservatives had their policy now in place then GM would have made the opposite decision.