THERE is one barnacle that the Abbott government needs to get rid of immediately: the rule that any director on a government board who was appointed by the previous Labor government will not be reappointed.
The decree, apparently issued by Prime Minister Tony Abbott and/or his chief of staff Peta Credlin and binding on all cabinet ministers, was publicly confirmed yesterday by the chairman of CSIRO, Simon McKeon.
He was speaking at an Australian Institute of Company Directors lunch that I was hosting. I asked the question of him because I had heard about the rule from the chairman of another federal government commission.
That chairman had told me he had attempted to get three members of his board reappointed this year, telling his minister that in each case they were good directors who contributed much to the organisation.
The minister apparently apologised, but said his hands were tied: they could not be reappointed because they were Labor appointees.
McKeon, a former Australian of the Year and Macquarie Group veteran, yesterday confirmed that, because he had been appointed chairman of CSIRO during the ALP’s term of government, he had been told that he would not be reappointed when his term ends in June.
Dr Nora Scheinkestel, a director of Telstra and a member of the Takeovers Panel, also confirmed the existence of this rule at yesterday’s AICD lunch.
Both Scheinkestel and McKeon said they disagreed strongly with this practice, as did the other company director on the panel, Graham Kraehe, chairman of BlueScope Steel, and a former director of NAB and the Reserve Bank.
And indeed, it is a totally ridiculous idea — childish even — and is becoming a growing problem between the Coalition and the business community.
“After all,” said Simon McKeon, “Labor was in power for six years. Virtually everybody currently serving on the boards of government bodies was either appointed or reappointed while Labor was in power. If Abbott persists with his policy, there will be a full clean out of directorships.”
More and more directors of government bodies are now coming up for reappointment — many of them supporters of the Coalition, and often doing it for philanthropic motives — and instead they are being booted off for no other reason than they happened to be appointed during a Labor government.
They are, understandably, offended at the suggestion that they are partisan in any way, or that they are ALP fellow travellers.
If Tony Abbott doesn’t drop this rule soon, relations between his government and the director community will break down irretrievably.
Apart from the offence caused to the directors, it confirms that the PM and his office are consumed with some kind of medieval notion of reprisal, or that they think that the world is comprised only of allies and enemies, and that anyone who appears to be a friend of their enemy must be an enemy.
The practice does neither the government nor the country any credit, and needs to be abandoned immediately.