05 Apr 2019
The budget’s deficiency dividend
By John Coyne
This week the Morrison government hit the pause button on their self-proclaimed campaign to control government spending, and handed down their election budget. The government’s budget offers most Australians a little something, but it has also been used to highlight the coalition’s national security credentials.
If re-elected, the government is planning to spend an additional $886.5 million on national security and law enforcement. The Australian Federal Police (AFP) is set to receive a funding boost of $512 million.
While this sounds like new money, for the most part, it’ll likely be used to plug the AFP’s budget gaps.
In March 2018, AFP Commissioner Andrew Colvin told a Senate estimates committee that his 6,500-strong organisation faced a ‘supply and demand’ challenge.
To start, there’s a growing global surplus of illicit drugs, such as cocaine and heroin, which is driving down wholesale drug prices. Criminal groups in the Golden Triangle and Mexico have shifted their focus to the production and distribution of synthetic drugs. And since 2015, East and Southeast Asia have become the leading subregions for methamphetamine seizures worldwide.
The continued globalisation of Australia’s crime problem is shifting policing responsibilities from the states and territories to the Australian Government.
This makes the AFP’s work disrupting criminal groups offshore more important than ever.
The bottom line here is that the AFP is facing a widening gap between the amount of crime that’s occurring and their capacity to respond to it.
At the same time, the AFP’s budget has been in a steady state of decline for several years.
Since 1987, the Government’s efficiency dividend has been a central principle in successive budgets. For the AFP, this initially resulted in long-overdue reductions in inefficient expenditure in non-operational areas.
However, cuts to operational areas eventually became inevitable and, then commonplace. Little surprise then that the AFP’s permanent offshore presence has shrunk substantially over the last decade.
Over the same period, successive governments have demanded the AFP increase its efforts in specific areas such as gangs and foreign interference. The AFP was forced to offset the expenditure from within their existing budgets: and again inevitably they stopped doing other work. Collectively, this has led to a compounding erosion of funding for existing programs of work.
The last major review of Commonwealth law enforcement arrangements undertaken in 2009 found that the AFP’s planning and operations were being undermined by the erosion of core funding.
A decade later and the Government has placed the AFP in exactly the same position.
On paper, the budget’s new funding looks great. However, it’ll most likely be used to plug up the gaps left from successive efficiency dividends and lapsing policy initiatives. In some cases, it will reduce the AFP commissioner’s ability to allocate staff and resources independently.
If past announcements are anything to go by, I would be surprised if this new money leads to any actual increases in staff numbers at the AFP.
It’s time for the Australian government to get serious about law enforcement. One key way to do so, without undertaking an expensive independent review, is to remove the burden of efficiency dividends from the AFP. This should then be followed by a minimum spend commitment, perhaps as a percentage of GDP, for law enforcement in Australia.