Harmonising social policy objectives with the quest for efficiency requires further reform of Community Service Obligations (CSOs) according to Mr. Bill Scales, Chairman of the Industry Commission.

Mr. Scales was speaking on the release of a Commission Information Paper which shows that progress in reviewing and reforming CSOs varies considerably between governments. "Some have made significant changes, but there is still much scope for many governments to improve CSO delivery."

CSOs - non-commercial functions performed by government business enterprises - are a significant component of the social policies of all Australian governments with a total annual cost exceeding $3 billion.

The Commission recommends several major priorities for future reforms of CSOs. These include:

• greater specification of CSOs;
• costing those CSOs presently uncosted;
• use of better methods of costing and greater consistency in costing methods;
• direct funding of CSOs;
• funding of CSOs on the basis of industry benchmarks rather than actual costs to provide greater incentives for the efficient delivery of services;
• implementation of more effective monitoring programs;
• immediate action by the Commonwealth to accelerate the specification, costing and public accountability of its CSOs; and
• Commonwealth implementation of direct funding of the CSOs of Telstra and Australia Post.

"The Steering Committee on National Performance Monitoring of Government Trading Enterprises could facilitate further reform by providing a forum for further collaboration between governments. It could also incorporate information relating to CSOs in its annual reports and facilitate the development of monitoring systems for the delivery of CSOs."

For more information...

Trevor Cobbold, (06) 240 3257, Clair Angel, Public Affairs (06) 240 3239

Forming the Productivity Commission

The Industry Commission, the former Bureau of Industry Economics and the Economic Planning Advisory Commission have amalgamated on an administrative basis to prepare for the formation of the Productivity Commission. Legislation formally establishing the new Commission is before Parliament.