A Public Policy Case Study of the Introduction of the GST - Goods and Services Tax

Abstract

Can the public policy process ever be rational? This question lies at the heart of much of the conceptual literature on policy making. The opportunity rarely arises to put this proposition to the test in a comprehensive way but the journey of the Australia Goods and Services Tax (GST) provides an appropriate case study for such a longitudinal analysis. The literature of public policy is dominated by the emphasis on the process of policy making and that is the approach examined in this research. The role of various groups including policy networks and advocacy coalitions are also considered. The GST has passed through just about all of the policy process iterations known in the literature and real world of public policy. The aim is to gain a clearer insight into the nature of public policy making through this comprehensive case study, and also to test the robustness of the theories of public policy process. The methodology adopted here has essentially involved an analysis of the public policy literature to discern criteria for the identification of both the ‘rational’ approach and challenges to the rational approach to policy making. These criteria have then been applied to the experience in three landmark turning points during the 30 year passage of efforts to introduce the GST. This has been achieved through analysis of primary source documents from these landmarks plus a range of interviews with key actors in these landmarks. Finally a synthesis of the lessons from these landmarks provides a conclusion as to the central proposition about the possibility of rationality in public policy making. The findings from the longitudinal case study research demonstrate that a pragmatic test of the rational approach and challenges to the rational approach to policy making can be devised. The policy analysis of a long policy process seems to confirm the Lindblom hypothesis that pure rational policy making is nearly impossible. This generalisation may not be confined to taxation policy, the process may be pervasive. The findings also demonstrate the iterative nature of public policy. The GST policy process oscillated from the rational comprehensive approach to other less rational approaches.