Green-tinted economic glasses

Business Spectator

If the Greens want to be taken seriously as they 'sweep' to increased power in successive state elections, adding to their unprecedented power in Canberra, they will have to begin getting their hands dirty and grappling with inescapable economic trade-offs.

The era of Greens policies being purely academic are gone and in the Victorian poll on November 27, the party faces its first real prospect of driving a state policy agenda.

Unlike the federal parliament, where Melbourne MP Adam Bandt is only one of five cross-benchers tempering Labor's legislative agenda in the House of Representatives, the Victorian lower house may end up with four Greens crossbenchers and only one independent – Craig Ingram, the Gippsland East MP who helped Steve Bracks snatch a surprise victory in 1999.

With Greens dominating the cross benches, Victorian Labor would be hamstrung on its own reform program – meaning its legislation, besides being frequently amended, will only get up if Labor pays the price of backing at least some Greens-sponsored bills in return.

In Canberra, the process is more complex – Greens-sponsored private members bills, whether introduced in the upper or lower house, require the support of at least two independents to pass (selected from among Bob Katter, Rob Oakeshott, Andrew Wilkie, Tony Windsor and 'independent' WA Nationals MP Tony Crook).

Bob Brown told supporters at the Victorian Greens election campaign launch over the weekend, "we are now a dinkum major political party which is replacing the old, the incapable and the outdated and the rusty Labor and Liberal party."

But the reality is that being a 'major' party brings with it major compromise. The Victorian Greens said over the weekend that they would not submit their policies for Treasury costings, claiming that simple decisions such as not buying water from the state's controversial desalination plant would be enough to fund their agenda.

This is not responsible behaviour for a 'major' party. A large ground-swell of support for the Greens in the Victoria makes a hung parliament, with Greens holding the balance of power, now very likely. But these voters, perhaps unwittingly, are trusting that the party will either push a legislative agenda that has no major cost implications, or that where it does, the Greens are just honest enough to have sorted out all the numbers on the back of a recycled envelope.

Victorian Greens policies include fixing the state's creaking public transport services (their solution is to take it back into public ownership), and phasing out the carbon-intensive Hazlewood power station.

Both are laudable objectives – but the former would undoubtedly blow out the state budget (currently slightly in surplus) and the latter would raise energy costs for many Victorian businesses, with obvious flow-on effects for jobs and payroll taxes.

This columnist, for one, wishes it were not so. But wishes are irrelevant when tough budgetary decisions are being made. Shut down Hazlewood, by all means, but show us how this is to be done without damaging Victoria's reputation as an inward-investment destination and sending power bills through the roof. Likewise for booting out private operators of Victoria's packed trains – if the Greens think they can run the network better for less, some hard figures need to be produced to show how.

Victorian Treasurer John Lenders told The Australian over the weekend that "The pie-in-the-sky ideas from the Greens pose a massive economic and budget risk to Victorians."

He's right. But they also pose a huge threat the Greens as a political force in Australia. Labor and Coalition strategists alike will be waiting for signs of any economic damage at either a state of federal level – and they will exploit it mercilessly at each successive poll.

John Brumby's government in Victoria already has some of the Greens' policy turf captured – his government has led the nation by promising to cut the state's CO2 emissions by 20 per cent by 2020, well ahead of the federal government's target of 5 per cent.

He also has better economic advisers to hand to explain to him, and then the electorate, how this is economically possible.

If they Greens want to be anything other than a flash in the pan in Australian political history, they are going to have to start doing the same – and fast.

Rob Burgess is Business Spectator's political correspondent. This article was originally published on Business Spectator.