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The End of the Carnell Government in the ACT
Scott Bennett
Politics and Public Administration Group
31 October 2000
The Carnell Government
Between February 1995 and October 2000 the Australian Capital Territory
(ACT) was governed by a minority Liberal Government, led by Kate Carnell.
Despite ongoing vulnerability this Government gave the ACT its longest
period of political stability since self-government in 1989.
Carnell's Government worked hard to boost the ACT economy, weakened by
Commonwealth public service cuts, by strengthening the private sector.
Carnell was an active Chief Minister, who appeared in the pages of the
Canberra Times almost daily. She was portrayed (and described herself)
as a 'can-do' Chief Minister, keen to put Canberra on 'the business and
tourism map'.(1)
Apart from the Government's constant boosting of the advantages of Canberra
as a site for new businesses, an important plank in Carnell's vision for
Canberra was what the Canberra Times called an 'events-led recovery
policy'.(2) The spring flower festival, Floriade, the annual
Summernats motor festival, the gaining of the 6th Australian Masters Games,
the running of a V8 Supercar race, and the building of a futsal slab for
international competition, were typical of the developments that Carnell
encouraged. Her Labor predecessor had been keen to have Canberra in the
Olympic soccer program, and once in power Carnell became an enthusiast
for what she described as 'all the wonderful spin-offs of being an Olympic
City'.(3)
Carnell's vigorous approach to government brought a great deal of attention
to the Chief Minister, as well as some criticism of her approach. The
Canberra Times noted that her 'can-do' style attracted many voters,
but it warned that 'there is always the likelihood that short cuts taken
to achieve results will lead to trouble'.(4) Overall, though,
the Chief Minister's efforts seemed well-received by the electorate. In
the 1998 election the Liberal Party vote fell from 40.5 per cent to 37.8
per cent but the Chief Minister's own vote jumped from 27.1 per cent to
33.5 per cent, both figures being a remarkable personal achievement in
a 7-member electorate, that helped elect not only Carnell, but two other
Liberal MLAs, including Gary Humphries.
Blemishes on the record
The major problems experienced by the Carnell Government often seemed
to be caused by efforts to produce results quickly, with a consequent
cutting of corners. Controversies over issues such as the redevelopment
of the Manuka shopping centre, the development of the outer-Canberra area
of Kinlyside, the inconveniences associated with the V8 race, the redevelopment
of Bruce Stadium and, above all, the bungled implosion of Canberra Hospital,
began to tarnish the Government's record. The position of the Chief Minister
did not seem to be threatened, however.
The controversy over the Bruce Stadium was to change all that.
Bruce Stadium
Although the needs of three football codes play an important part in
the operation of Bruce Stadium, the prime factor in the decision to redevelop
was linked with the desire to host Olympic soccer matches. Essentially
the aim was two-fold: to increase seating from 11 000 to 25 000
capacity, and to generate much larger stadium revenues.(5)
Cabinet's 1997 decision to redevelop depended on money being raised from
three sources: government appropriations ($12.3million), sale of stadium
products ($8 million) and government guaranteed borrowing from the private
sector ($7million).(6) The Government maintained that the taxpayer's
share would remain capped at $12.3million.
It was soon obvious that the costs of the redevelopment were going to
be much higher than $27.3million, leaving the Government with the option
of abandoning the project or finding the means of proceeding. In continuing
the work, it followed some paths that later left it open to criticism.
These included spending $24m without Legislative Assembly approval, and
taking out an overnight loan to balance the government's books at the
end of the 1997-98 financial year.
By early 1999 public concern was being expressed over doubtful government
processes and the increasing costs of the stadium.(7) Former
NSW Auditor-General, Tony Harris, used the affair to accuse governments
in Australia of forgetting that they needed parliamentary approval to
be able to spend money, despite this being 'the basis of the relationship
between the parliament and the government'.(8) The Chief Minister's
response to criticism was that if the law had been breached, it was done
in good faith.(9) She also accused the Canberra Times of
showing bias and a lack of ethics, and attempting to create an unwarranted
air of Government cover-up and secrecy.(10) On 18 June 1999
the ACT Auditor-General advised MLAs that he would conduct an audit of
the Bruce Stadium redevelopment.
Despite the Auditor-General's investigation being incomplete, on 30 June
1999 the Labor Party moved a vote of no confidence in the Chief Minister
over the issue. Independent MLAs, Paul Osborne and Dave Rugendyke, voted
against the motion, preferring to wait for the Auditor-General's report.
Rugendyke noted, however, that if the report provided 'the knockout punch',
he would have no hesitation in supporting another no-confidence motion.(11)
In July 2000 Osborne and Rugendyke were active in negotiations over the
Budget. In particular, their opposition to a supervised injecting room
trial threatened to defeat the Budget. After a tense standoff a compromise
was reached and the Budget survived. It indicated the ongoing fragility
of the Government's position.(12)
The Bruce Stadium audit was eventually made public on 25 September
2000. Apart from many criticisms made about procedural weaknesses, it
made two findings that probably sealed the fate of the Chief Minister:
- 'The payments made for the redevelopment in excess of the amounts
appropriated were not lawful at the time they were made'.
- 'The overnight borrowing was not lawful'.(13)
On 11 October Labor moved a no-confidence motion to be debated on 18
October.
Carnell is replaced
It was now clear that Rugendyke and Osborne would support this motion,
and that Carnell would be defeated. Neither independent relished the possibility
of Labor coming to power, and to avoid this Osborne even went so far as
proposing a constitutional change to alter the fixed term arrangements
to enable the calling of an early election. This was attacked by the Canberra
Times as 'an abuse of democracy'.(14)
In the days prior to the debate there was much speculation as to the
likely course of events. Carnell denied any wrong-doing and, in fact,
claimed that the Auditor-General had found that the Cabinet had acted
'reasonably' in the Bruce Stadium matter.(15) She seemed determined
to remain in office, though this may have been undermined by a Canberra
Times-Datacol poll which found 60 per cent of respondents believed
she should resign. This was an increase of 10 per cent on a similar poll
in June 1999.(16)
Despite her determination, there seemed to be only two possible constitutional
outcomes:
- Carnell to be replaced by a Liberal colleague, or
- the Liberals to refuse to nominate a replacement, hence allowing Labor
to govern.
Despite talk of the latter occurring, Carnell resigned on 17 October,
and was replaced as Chief Minister by Gary Humphries the next day, suggesting,
in the view of one observer that 'the concept of fixed terms has been
strengthened, and the ACT's particular version of Westminster parliamentary
democracy becomes a potential model for other jurisdictions'.(17)
- 'Correct approval process followed for Futsal slab: Carnell', Canberra
Times, 19 February 1999.
- 'A sporting chance or sports mad?', Canberra Times, 25 January
1998.
- 'Canberra's clever capitalist cabaret continues', Canberra Times,
20 March 1998.
- Editorial, Canberra Times, 17 February 1999.
- Auditor-General's Report into the redevelopment of Bruce Stadium,
Report 4, p. 1; Report 1, p. 17.
- Auditor-General's Report ..., Report 6, p. 2.
- 'Under the bleachers at Bruce', Canberra Times, 24 April 1999.
- 'Victorian QC to advise on Bruce Stadium funding row', Canberra
Times, 29 April 1999.
- 'Fate in Assembly's hands', Canberra Times, 1 May 1999.
- 'Bruce funding is the main game', Canberra Times, 22 May 1999.
- Mr Rugendyke, Legislative Assembly, Debates, 30 June 1999,
p. 1875.
- S. Bennett, 'Government in the ACT-a Shift from Westminster?', Research
Note, no. 2, Department of the Parliamentary Library, Canberra,
2000.
- Auditor-General's Report ..., Report 11, p. 5.
- Editorial, Canberra Times, 16 October 2000.
- K. Carnell, 'Stadium a sign of Canberra's boom economy', Sydney
Morning Herald, 13 October 2000.
- 'Poll verdict: Carnell should go', Canberra Times, 16 October
2000.
- Brian Austen, letter to Canberra Times, 19 October 2000.
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