In quick succession the Rees Government in NSW has lost the director-general of the Premier’s and Cabinet Department Robyn Kruk and now the director-general of Treasury John Pierce.

To paraphrase Lady Bracknell in The Importance of Being Earnest: “To lose one director-general may be regarded as a misfortune; to lose two looks like carelessness.”

Both these senior mandarins happily collected their $300,000-plus salaries — along with occasional performance bonuses — during the 13 years of the Carr and Iemma Governments.

Like rodents leaving a sinking ship, they have followed their erstwhile masters in a search for calmer — private sector — waters to earn a living.

Having presided in no small part in turning NSW into the nation’s economic basket case, Kruk and Pierce have quit the air-conditioned splendour of Governor Macquarie Tower leaving others to pick up the guano sandwich and eat it. Thanksalot — Public Service Medals are in the post.

By why the haste to get out? Heather Ridout, chief executive of the Australian Industry Group, supplied an answer in yesterday’s Meet the Press interview when she suggested, quite seriously, that Prime Minister Kevin Rudd appoint administrators to run NSW.

“I think Kevin Rudd needs to take NSW aside from the COAG (Council of Australian Governments) process and work out what we need to do to fix this state, and what conditions need to be put on it.

“A bit like an administrator going into a local council and saying, ‘Let’s have a look at the books, let’s have a really good look at what’s going on here and fix it’.”

Ridout’s remarks are mind-boggling. She has made the unflattering comparison between the NSW government and a bankrupt council and called for the remedy which faces every council that goes broke: the councillors are sacked, administrators are appointed and all decisions are taken by handpicked “three wise men” (They’re always male).

That’s what happened to New York City in 1975 when the Municipal Assistance Corporation (Big Mac) was put in charge to stop the Big Apple from sliding into bankruptcy and taking a large part of the US economy with it.

This is Ridout’s fear today. She said the policies of the Rees Government “definitely” were pushing Australia closer to recession and the NSW economy had become a national issue requiring separate attention.

“It is a third of the national economy, unemployment is highest here — well over 5 per cent now — its budget position is very ordinary,” she said.

Just over a week ago, Rudd appeared to acknowledge the scale of the NSW economic basketcase when he declared that the Rees Government should “lift its game”. But other senior Rudd ministers from NSW seem to believe that they can cruise to the next federal election in 2010 by pretending the NSW debacle doesn’t exist and/or is none of their business.

There’s a gorilla in the national economy and someone is going to have to get into the cage armed with a stun gun and a maxi-hypodermic needle. Could someone get Swanny on the line?

Peter Fray

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