More information has come to hand about John Pierce, Prime Minister Kevin Rudd’s newly appointed head of the Department of Resources, Energy and Tourism.

Pierce will start his new five-year job in Canberra on 2 March after being the longest-serving Secretary of the NSW Treasury since 1922.

The former chief economist at Pacific Power, Pierce joined the Treasury in 1993 as a servant of the then Coalition Government of Premier John Fahey. He was appointed Treasury Secretary by Premier Bob Carr in 1997 and held the position until his resignation in November 2008.

On his orthodox Treasury watch, the maintenance of basic public infrastructure came to a virtual halt, with the city and regional rail networks among the biggest losers. It also saw the dramatic increase in privately-owned tollways and privately-built and operated state schools. But his epitaph will be the Cross City Tunnel which was so misconceived it eventually fell into administration.

Pierce was, and remains, a personal favorite of Carr and former Treasurer Michael Egan who made sure he received performance bonuses on a regular basis.

Environmental activist Lynda Newnam points out that the NSW Treasury 2004-2005 annual report shows how Pierce received taxpayer-funded largesse from his political masters. It states:

The Secretary, John Pierce was on assignment in the United States of America from August 2004 to January 2005. He was commissioned by the then Treasurer, Michael Egan, to explore policy options to respond to long term budget pressures from an ageing population and trends in expenditure growth. Mr Pierce was based at the Boston University where he accessed research on long-term fiscal policy. He also investigated research by the Kennedy School of Government on productivity and performance.

Mr Pierce consulted Federal and State officials on the United States experience and International Monetary Fund staff. The results of Mr Pierce’s research will be used in a coordinated effort by Commonwealth, State and Territory Treasuries in formulating a response to the challenges confronting all governments due to an ageing population and expenditure growth.

The six-month fact-finding mission was an all expenses paid affair. It coincided with Egan’s last six months in the job — he resigned in January 2005 just as Pierce returned home from his US assignment.

At Treasury, Pierce created a mini-empire. In 2006 he had two deputy secretaries Mark Ronsisvalle and Kevin Cosgriff, two executive directors Ian Neale and Philip Mussared, a deputy secretary Michael Schur, and two executive officers Graeme Bullivant and Rose Williams.

Despite all this talent being concentrated in one brains trust, the NSW economy slipped into the doldrums, resulting in a $1 billion revenue black hole and investors took fright at the government’s incompetence and the State’s high taxes.

With mineral resources, energy and the multi-billion dollar tourism industry in his department, Pierce will be relishing his appointment and so will industry leaders.

But Pierce’s new minister, Martin Ferguson, MP for the Victorian seat of Batman, is a forthright left-winger of the old school so there are bound to be fireworks between the free marketeer and the state intervener. Which is precisely what Rudd wants.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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