Policy Performance


Economic Policies

With declining natural-resources income exacerbating budgetary pressures, Australia falls into the lower-middle ranks (rank 26) with respect to economic policy. Its score in this area has fallen by 0.5 points relative to 2014.

A midstream change in prime ministers restored some confidence in the government after a period of uncertainty. However, dependence on resources exports remains strong, with falling prices undermining revenue and growth. Budget deficits have been substantial and persistent. Unlike other resource-dependent countries, the country has created no fund to guard against commodity-price downturns.

Unemployment rates have held steady after climbing for several years. A labor-immigration program intended to address a skilled-workers shortage has been curtailed somewhat. A high minimum wage at a time of stagnant real wages may be a drag on employment. The new prime minister has highlighted the importance of innovation despite disappointing R&D results.

Public debt remains comparatively low, but calls for structural budgetary reform are intensifying. Private-sector debt levels are very high. Though proposed coalition-government reforms have met strong opposition, the new leadership has placed new focus on reducing left-right tensions.

Social Policies

With left-right tensions over proposed expenditure cuts declining, Australia falls into the upper-middle ranks with regard to social policy (rank 14). Its score in this area has declined by 0.3 points relative to 2014.

Integration policy has a long and successful, though selective, history. High-skilled migrants are encouraged, but are not eligible for assistance such as unemployment benefits for several years. The indigenous population remains badly marginalized.

Concerns about deteriorating educational quality are linked to geographic and income inequities. A controversial government plan to deregulate higher-education fees has been abandoned. A sweeping welfare-system overhaul has been proposed, with the aim of reducing long-term reliance on benefits. Public pensions are comparatively small, but a shift toward private pensions is underway

The health care system is generally of high quality, though waiting periods can be long. The government reduced hospital funding in recent years, and unsuccessfully sought to introduce copayments. Child care subsidies are being significantly increased, but women with children still gravitate toward part-time work. A new electronic-surveillance policy aimed at countering terrorism has raised civil-liberties fears.

Environmental Policies

Policy rollbacks and emissions concerns have left Australia scoring relatively poorly (rank 32) with respect to environmental policy. Its score on this measure has declined by 0.5 points relative to 2014.

Despite reduction goals, CO2 emissions are rising. Recently abolished, the carbon tax was replaced by a system paying businesses to reduce emissions, regarded as ineffective by most experts. Public-transport gaps mean infrastructure investments must form a key part of future environmental policies.

Energy consumption levels remain high, and renewable-energy use has actually declined since the 1970s. Agricultural water use is a source of considerable political tension.

Recent declines in biodiversity have prompted new concerns. Participation in international environmental regimes has divided the political left and right.



Quality of Democracy

With an open, transparent electoral regime, Australia’s democracy falls into the upper-middle ranks (rank 15) in international comparison. Its score on this measure has declined by 0.2 points since 2014.

The country lacks a bill of rights, but civil rights and political liberties are generally well protected by legislation and the courts. New anti-terrorism laws enable broad and warrantless electronic surveillance, and are strongly opposed by civil-liberties groups. Anti-discrimination laws are generally broad.

Media organizations are largely independent, but the print media is highly concentrated. Broadcast media are slightly more diverse. Anti-terrorism laws also allow some restrictions on media reporting.

Courts are independent and strong, though judicial appointments lack transparency. While corruption is generally rare, some problems at the state and local level remain.



Executive Capacity

With a change in prime ministers having eased political tensions, Australia falls into the upper-middle ranks (rank 13) in the sphere of executive capacity. Its score on this measure has declined by 0.3 points relative to 2014.

The government office coordinates policy development, working closely with line ministries. Ministries often collaborate at lower levels as well, and cabinet committees handle routine or detailed issues. While the Liberal-National coalition government’s inability to win passage for key measures in the upper house led to a change in prime ministers, the new leadership appears likely to be more successful.

RIAs are generally required at the federal and state levels, though these often lack transparency and do not explicitly address long-term sustainability. The lack of a strategic economic vision to compensate for resource-income declines is a particular weakness.

While many tasks are constitutionally delegated to states and territories, funding is often inadequate. The central government has sought to take over authority or policy control in some of these areas.

Executive Accountability

Despite declining citizen engagement with the political system, a well-developed legislative-oversight capability gives Australia good rankings (rank 7) for executive accountability. Its score in this area is unchanged relative to 2014.

Parliamentarians have substantial resources and powers at their disposal to monitor the executive. Long-established audit and ombuds offices act capably and independently.

Citizens have shown a declining interest in political issues, and electoral-participation rates are falling. The lack of media diversity hinders the development of policy knowledge, though online news providers are reinvigorating the sector to some extent.

Internal political-party decisions are primarily made by elected officials, although ordinary members have gained a stronger voice in recent years. Major economic organizations are sophisticated and work closely with the government. Many other interest groups also offer high-quality proposals.
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