Policy making is the process by which governments develop courses of action to address problems or achieve specific goals. It’s fundamentally about making decisions that affect groups of people and allocating resources to implement those decisions. But understanding policy making in the abstract only goes so far—the best way to learn how policy actually works is to examine real cases.

This guide takes you through six major Australian policy initiatives from the past two decades. Each case reveals different dynamics: some policies succeeded, some failed, some are still struggling. Together, they provide a comprehensive picture of how policy is made, implemented, and sometimes unmade in a modern democracy.

The Policy Cycle: A Framework

Before diving into the cases, it’s helpful to understand the general framework that policy scholars use. Most policy making follows a cycle, though real-world policy is far messier than any model suggests:

1. Agenda Setting - Problems get recognized and prioritized for government attention. Not every issue becomes a policy issue.

2. Policy Formulation - Developing proposed solutions through research, consultation with experts and stakeholders, and drafting options.

3. Decision Making - Choosing among proposed options. This is where politics really comes into play, as different interests compete and compromise.

4. Implementation - Putting the chosen policy into practice through regulations, programs, and bureaucratic action.

5. Evaluation - Assessing whether the policy is working as intended and what effects (intended and unintended) it’s having.

6. Revision or Termination - Based on evaluation, policies may be adjusted, continued, or ended.

Now let’s see how this plays out in practice.

Case Study 1: Tobacco Plain Packaging (2011-2012)

The policy that made Australia a global pioneer

Agenda Setting

By the late 2000s, Australia had been reducing smoking rates for decades through various measures—advertising bans, graphic health warnings, tax increases. However, rates had plateaued. Public health advocates argued that attractive packaging was one of the last marketing tools tobacco companies had, particularly for attracting young people.

The issue gained momentum when several factors aligned:

• Health groups like the Cancer Council and Heart Foundation campaigned strongly
• International evidence from countries considering similar measures emerged
• The Rudd/Gillard Labor governments were receptive to public health interventions
• Australia’s National Preventative Health Taskforce (2009) recommended plain packaging

This is a classic “policy window”—the problem (smoking deaths), a proposed solution (plain packaging), and political will all converged at the same time.

Policy Formulation

The government commissioned extensive research and consultation from 2008-2011:

• Public health experts provided evidence on packaging’s role in smoking uptake
• Treasury modeled economic impacts
• The Attorney-General’s Department assessed legal risks (crucial, as they knew legal challenges were coming)
• Public consultations were held, though heavily dominated by health groups versus the tobacco industry

The proposed policy was radical globally: all cigarette packs would be drab olive-brown, with no logos, only brand names in standardized fonts, and 75% covered by graphic health warnings.

Decision Making

The political landscape was interesting:

• The policy had strong support from Labor and the Greens
• The Coalition (Liberal/National) was divided—some supported it on health grounds, others opposed it as government overreach
• Public opinion polls showed strong support (around 70%)
• Tobacco companies lobbied intensively, arguing it would destroy intellectual property and wouldn’t work

The government decided to proceed, passing legislation in November 2011. Health Minister Nicola Roxon was the key champion. The policy was scheduled to begin December 1, 2012.

Implementation

This phase was complicated by legal challenges:

• Tobacco companies challenged it in the High Court (lost in August 2012)
• Ukraine, Honduras, and the Dominican Republic challenged Australia at the WTO (dispute lasted years, Australia ultimately won in 2018)
• Philip Morris Asia attempted to sue using a Hong Kong-Australia investment treaty (lost in 2015)

Despite these challenges, the policy was implemented on schedule. The government had to:

• Give retailers time to sell existing stock
• Ensure customs could identify illicit products
• Run public education campaigns
• Monitor compliance

Evaluation

Research since implementation has shown:

• Modest but significant reductions in smoking prevalence
• Reduced appeal of packs, particularly to young people
• Increased effectiveness of graphic health warnings (they’re more prominent now)
• No significant increase in black market tobacco (a key industry claim)
• The policy cost much less than predicted to implement

Policy Diffusion

Australia’s success led to global policy diffusion. Over 20 countries have now implemented or are implementing plain packaging, including the UK, France, New Zealand, and Canada. Australia essentially became a test case for the world.

What This Case Teaches Us

Evidence matters, but isn’t everything: The government had strong public health evidence, but still faced massive political and legal opposition.

Policy champions are crucial: Nicola Roxon’s determination was vital. Without political will at the ministerial level, evidence alone doesn’t create policy.

Implementation can be as important as legislation: The government won because they’d done their legal homework and anticipated the challenges.

Interest groups shape policy: The tobacco industry fought hard, but public health groups were better organized and had public opinion on their side.

International dimensions matter: This wasn’t just domestic policy—it involved trade law, international treaties, and set precedents globally.

Case Study 2: The National Disability Insurance Scheme (2013-present)

A massive social reform that demonstrates both policy success and implementation challenges

Agenda Setting (decades in the making)

Unlike tobacco plain packaging which moved relatively quickly, the NDIS had a very long gestation period:

Throughout the 1970s-2000s, disability advocates had been campaigning about the inadequate, fragmented system. Support varied wildly by state, and many people with disabilities got little or no help.

The Productivity Commission called it a “lottery”—where you lived, how you acquired your disability (workplace versus congenital versus accident), and your family’s wealth determined what support you got.

The critical moments:

• 2008: People with Disabilities Australia and other groups intensified campaigning
• 2010: Julia Gillard (then Prime Minister) committed Labor to investigating a national scheme
• 2011: The Productivity Commission delivered a landmark report recommending a National Disability Insurance Scheme

This report was crucial—it gave the policy credibility, detailed costings, and a comprehensive framework. The issue gained traction because of compelling human stories, cross-party support building, the Productivity Commission’s “legitimate” technocratic blueprint, and a strong advocacy coalition.

Policy Formulation (2011-2013)

The design phase involved adopting the Productivity Commission’s insurance model (not welfare, but insurance against the costs of disability) and making critical decisions about:

• Eligibility criteria (who qualifies for support?)
• The “reasonable and necessary supports” framework
• Federal-state funding splits (disability had been mostly state responsibility)
• Creating an independent agency (NDIA - National Disability Insurance Agency)
• Individualized funding and choice/control principles

Key design features that emerged:

• Person-centered: Individuals get plans tailored to their needs and goals
• Choice and control: People choose their providers and how funds are spent
• Insurance principle: Early intervention to reduce long-term costs
• National consistency: Same entitlement regardless of location

Decision Making (2012-2013)

This is where the NDIS is unusual—it had bipartisan support:

• Labor (Gillard government) championed it
• The Coalition (opposition) supported it, with Tony Abbott calling it “a moral imperative”
• Passed Parliament with overwhelming support in March 2013

Why the bipartisan consensus?

• Disability advocacy transcended party lines (affects all communities)
• The Productivity Commission’s involvement gave it credibility
• Public support was overwhelming (~90% approval)
• Framed as “insurance” not “welfare” (more politically palatable)
• No one wanted to be seen opposing disability support

A small Medicare levy increase (0.5%) was introduced to help fund it, and this passed too.

Implementation (2013-2020 rollout, ongoing)

This is where it gets really messy—and shows how implementation can make or break policy.

Trial Phase (2013-2016): Launched in trial sites (Barwon, Hunter, South Australia, Tasmania) to test systems, demand, and processes. This revealed significant problems early.

Full Rollout (2016-2020): Phased rollout across all states, aiming to reach 500,000 participants by 2020 (actually reached ~530,000).

Implementation Challenges:

Demand exceeded projections:

• More people were eligible than predicted
• Participants’ needs were higher than modeled
• Costs escalated rapidly (now ~$44 billion annually versus initial ~$22 billion projections)

System problems:

• IT systems struggled to cope
• Processing times blew out (plans taking 6-12 months)
• High staff turnover at NDIA
• Inconsistent decision-making between planners

Market development issues:

• Not enough service providers in some areas, especially rural/remote
• Some providers exited the market due to payment delays
• Quality and safeguarding concerns emerged
• Price inflation in some service categories

Gaming and fraud:

• Some providers rorting the system (charging for services not delivered)
• Some participants getting inappropriate supports approved
• Limited fraud detection initially

Philosophical tensions:

• Conflict between “insurance” model (funded supports only) versus “rights” model (meeting all needs)
• Battles over what’s “reasonable and necessary”
• Tension between choice/control and safeguarding

Evaluation and Revision (ongoing)

The NDIS has been under almost constant review:

Major reviews:

• 2019-2020: Tune Review examined financial sustainability
• 2021-2022: Parliamentary Joint Standing Committee inquiries
• 2022-2023: NDIS Review (led by Bruce Bonyhady and Lisa Paul)
• 2023-2024: Government response to reviews

Key findings:

• Scheme is fundamentally sound but needs significant fixes
• Cost trajectory is unsustainable without changes
• Too much complexity and bureaucracy
• Need better supports outside NDIS (mainstream services)
• Better workforce planning needed
• Fraud and safeguarding must improve

Reforms underway (2024-present):

• New legislative framework being introduced
• Lists of supports that are/aren’t funded
• Crackdown on fraud and inappropriate spending
• Better connection with mainstream services (health, education, housing)
• Focus on early intervention
• Improved planning processes
• Better definition of “reasonable and necessary”

Current Status

The NDIS is now a permanent fixture of Australian society, but it’s evolving:

• Around 660,000 participants (2024)
• Costs around $44 billion annually
• Supports being refined
• Major reforms continuing under Bill Shorten (NDIS Minister)

What This Case Teaches Us

Long gestation periods: Unlike tobacco plain packaging, the NDIS took decades of advocacy before reaching the agenda.

Technical expertise matters: The Productivity Commission report was absolutely crucial in legitimizing the scheme and providing a blueprint.

Bipartisan support helps but doesn’t solve everything: Even with political consensus, implementation can be extraordinarily difficult.

Implementation is policy: The design on paper differed significantly from the reality of delivery. The “street-level bureaucrats” (NDIA planners) effectively make policy through their daily decisions.

Cost projections are hard: The scheme cost roughly double the initial estimates—partly because demand was underestimated, partly because needs were underestimated.

Unintended consequences are inevitable: The market-based model created perverse incentives for some providers. The individualized approach created huge administrative burden.

Policy is never “finished”: The NDIS is in constant evolution as problems emerge and are addressed.

Values versus resources: There’s ongoing tension between the rights-based vision (people with disabilities deserve full participation) and fiscal reality (governments have finite resources).

Case Study 3: Carbon Pricing Scheme and Its Repeal (2011-2014)

The rise and fall of climate policy

This case demonstrates how policy can be created and then completely undone, and the devastating political consequences that can follow.

Agenda Setting (long and tortuous)

Climate change had been on the Australian political agenda since the 1990s, but gained real traction in the 2000s:

• 2006-2007: Climate change became a major political issue due to severe drought, Al Gore’s documentary, and growing international momentum
• 2007 Election: Both major parties promised action. Kevin Rudd called climate change “the great moral challenge of our generation.” John Howard promised an emissions trading scheme too.
• The “climate election”: Rudd won partly on climate credentials

First Attempt - Policy Formulation (2008-2009)

The Rudd government moved quickly:

• Commissioned the Garnaut Review (economist Ross Garnaut’s comprehensive climate report)
• Designed the Carbon Pollution Reduction Scheme (CPRS)—a cap-and-trade emissions trading scheme
• Extensive consultation and white papers

Problems emerged:

• Greens thought it too weak (too many free permits to polluters)
• Coalition initially negotiated, then changed leaders to Tony Abbott who opposed it
• Business groups split
• Mining industry campaigned against it heavily

First Decision - Failure (2009)

The CPRS was defeated twice in the Senate in 2009:

• Greens and Coalition voted against it (for opposite reasons)
• Rudd promised to go to a double dissolution election on it
• Then he shelved it until 2013, citing global inaction
• This broken promise devastated his popularity

Political earthquake:

• Rudd was challenged and replaced by Julia Gillard in June 2010
• Gillard promised “there will be no carbon tax under the government I lead”
• 2010 election resulted in hung parliament
• Gillard needed Greens support to form minority government

Second Formulation - The “Carbon Tax” (2010-2011)

To get Greens support, Gillard agreed to carbon pricing:

The design:

• Start with fixed price ($23/tonne) for 3 years (2012-2015)—this was called a “tax”
• Transition to floating price emissions trading scheme from 2015
• Revenue used for compensation (households, trade-exposed industries) and clean energy investment
• Covers major emitters (electricity, industry)

This was politically toxic because:

• Gillard’s “no carbon tax” promise
• Framed as “broken promise” even though it was temporary before ETS
• The word “tax” is politically poisonous in Australia
• Abbott ran relentless “axe the tax” campaign

Decision Making - Second Attempt (2011)

Passed Parliament in November 2011 with Labor, Greens, and independent support.

The political context:

• Gillard had no choice—needed Greens for government
• Coalition in fierce opposition
• Business community divided
• Public opinion turned negative (combination of “broken promise” narrative and cost-of-living concerns)
• Media coverage overwhelmingly negative, particularly News Corp papers

Implementation (July 2012 - July 2014)

The carbon price began July 1, 2012:

What happened:

• Electricity prices rose (though partly due to other factors)
• Compensation packages flowed to households
• Some businesses complained about competitiveness
• Emissions did start falling (though hard to isolate carbon price effect)
• Revenue came in roughly as expected
• The sky didn’t fall—many dire predictions didn’t materialize

Political impact:

• Labor’s polling remained terrible
• “Carbon tax” was central to every political debate
• 2013 election campaign dominated by it
• Abbott’s “axe the tax” was simple and effective messaging

Major error discovered:

• May 2020: Treasury realized it had overestimated take-up
• Revised cost from $130 billion to $70 billion
• Embarrassing but actually good news

The Repeal - Policy Termination (2013-2014)

September 2013 election:

• Coalition won convincingly
• Abbott’s first priority was repealing carbon pricing
• Framed as keeping election promise

The repeal process:

• Bills introduced immediately
• Senate (where Greens and Labor had numbers) blocked repeal initially
• July 2014 Senate changed (new senators elected in 2013 took seats)
• Palmer United Party (Clive Palmer’s party) held balance of power
• PUP negotiated retention of Clean Energy Finance Corporation and Climate Change Authority
• Carbon price repealed July 2014 with PUP support

Aftermath and Legacy

What happened after repeal:

• Emissions started rising again
• Australia struggled to meet international commitments
• Policy uncertainty devastated renewable energy investment (2014-2016)
• No replacement mechanism put in place
• The “Emissions Reduction Fund” (direct action) proved insufficient

The policy void (2014-2022):

• Climate policy became political poison
• Multiple leadership changes partly driven by climate disputes (Abbott, Turnbull, Morrison)
• National Energy Guarantee proposed and abandoned (2018)
• Australia’s climate policy was paralyzed for nearly a decade

Recent developments:

• Labor elected 2022 with climate policy
• Safeguard Mechanism reformed (essentially carbon pricing for industry by stealth)
• But the word “carbon price” remains politically toxic

What This Case Teaches Us

Framing is everything: Economically, a “carbon tax” and “emissions trading scheme” can be identical in effect, but politically they’re worlds apart. The term “tax” was devastating.

Promises constrain options: Gillard’s “no carbon tax” promise, made for short-term political gain, destroyed her ability to sell necessary policy.

Opposition campaigns matter: Abbott’s simple “axe the tax” was far more effective than complex explanations of climate economics.

Minority government creates opportunities and risks: Gillard got climate policy through, but only because she had no choice politically, and it cost her government.

Policy termination is easier than creation: Took years to design and pass, months to repeal.

Political cycles can destroy policy: The 3-year election cycle meant the policy never had time to bed down and demonstrate results before facing electoral judgment.

Policy legacy outlives the policy: The failure poisoned climate politics for a decade. Successive leaders were destroyed by climate policy disputes.

Compensation isn’t enough: Even though households were compensated, the perception of cost dominated.

Business certainty matters: The on-again, off-again nature devastated investment. Businesses wanted certainty more than any particular policy.

Symbolic politics trumps substance: The actual economic impact was modest, but the symbolic politics were enormous.

Case Study 4: Marriage Equality (2017)

Social policy through postal survey

Agenda Setting (long evolution)

Marriage equality had been on the political agenda since the early 2000s:

• 2004: Howard government amended Marriage Act to define marriage as between man and woman (preemptive move)
• 2000s: Growing LGBTIQ+ advocacy, public opinion slowly shifting
• 2010s: International momentum (US, UK, Canada, New Zealand legalizing same-sex marriage)
• Public opinion shift: By 2015, polls showed ~60-70% support for marriage equality

Multiple failed legislative attempts:

• Several private members’ bills failed in Parliament (2012, 2013, 2015, 2017)
• Labor officially supported it from 2011
• Coalition had mixed views, allowed conscience votes but majority opposed

Political dynamics:

• Labor and Greens supported marriage equality
• Coalition divided (urban liberals versus conservative base)
• Malcolm Turnbull (PM from 2015) personally supported it but led party with many opponents
• Tony Abbott and conservative MPs strongly opposed

Policy Formulation - The Unusual Path (2016-2017)

Turnbull faced a dilemma:

• Personally supported marriage equality
• Needed conservative support to maintain leadership
• Public pressure growing

The “solution”—a plebiscite:

• 2016: Turnbull proposed compulsory plebiscite (national vote)
• Rationale: Let the people decide, not Parliament
• Critics said it was delaying tactic and would harm LGBTIQ+ people

First plebiscite blocked (2016):

• Labor, Greens, and crossbench opposed plebiscite in Senate
• They argued Parliament should just legislate, plebiscites were expensive and divisive
• The plebiscite bill failed

Second attempt—postal survey (2017):

• Turnbull government found alternative: voluntary postal survey through Australian Bureau of Statistics
• Didn’t require legislation (just money from existing appropriations)
• Cheaper than plebiscite (~$122 million)
• Non-binding—Parliament would still need to legislate

Legal challenge:

• Some LGBTIQ+ advocates challenged postal survey in High Court
• Argued it was harmful and unnecessary
• High Court upheld government’s power to conduct it (September 2017)

The Campaign (September-November 2017)

This was unusual—a public campaign on social policy:

YES campaign:

• Led by Equality Campaign
• Message: “Love is love,” “It’s time”
• Emphasized fairness, equality, love
• Supported by major corporations, celebrities, sports codes
• Rainbow imagery everywhere

NO campaign:

• Led by Coalition for Marriage
• Arguments varied: religious freedom, “traditional marriage,” children’s welfare, “safe schools” concerns
• Much smaller budget and organization
• Some very negative messaging

The public debate:

• Intense, sometimes ugly
• Some LGBTIQ+ people reported harassment
• Concerns about mental health impacts on LGBTIQ+ community
• Media saturation for 2 months

The Vote (November 2017)

Results announced November 15, 2017:

• 61.6% YES, 38.4% NO
• 79.5% participation rate (remarkably high for voluntary survey)
• Every state and territory returned YES majority
• 133 of 150 electorates voted YES

Geographic patterns:

• Higher YES votes in inner cities, lower in outer suburbs and regions
• Some electorates (like Blaxland in Western Sydney) voted NO
• Strong correlation with demographics (education, religiosity, age)

Legislative Decision (November-December 2017)

After the YES vote, Parliament moved quickly:

• Cross-party working group drafted legislation
• Senator Dean Smith (Liberal, WA) introduced private member’s bill
• Bill included religious protections (existing celebrants could refuse)
• Passed Senate: December 7, 2017 (43-12)
• Passed House: December 7, 2017 (146-4)
• Massive bipartisan support once the survey result was clear
• Royal assent: December 8, 2017

What passed:

• Marriage redefined as between “2 people” (not man and woman)
• Religious ministers could refuse to marry same-sex couples
• Existing marriages from overseas recognized
• No broader religious exemptions

Implementation (December 2017 onwards)

• Law took effect immediately
• First marriages: December 9, 2017
• Registry offices and celebrants adjusted processes
• Thousands of couples married in first weeks/months
• Remarkably smooth implementation

Evaluation and Legacy

Outcomes:

• Thousands of same-sex couples married
• Legal equality achieved (marriage, adoption, parenting rights)
• Minimal predicted negative consequences materialized
• No major religious freedom conflicts

Social impacts:

• Symbolic importance huge for LGBTIQ+ community
• Some reported mental health improvements from validation
• Normalization of same-sex relationships
• Younger generation grows up with marriage equality as normal

Political legacy:

• Showed direct democracy can work on social issues
• Also showed costs (mental health impacts during campaign)
• Debate about whether postal survey was necessary or harmful
• Demonstrated how quickly public opinion had shifted

The “what if”:

• Many argue Parliament should have just legislated years earlier
• Postal survey was expensive, divisive, and delayed justice
• Counter-argument: the overwhelming YES vote gave it legitimacy and made reversal politically impossible

What This Case Teaches Us

Public opinion matters but isn’t always enough: Support was majority for years, but Parliament was gridlocked due to internal party dynamics.

Leadership constraints: Turnbull wanted marriage equality but was constrained by his conservative party room. He found a creative (if controversial) solution.

Direct democracy is complex: The postal survey “worked” (got clear result, led to legislation) but had significant costs (mental health, public division).

Symbolic politics matter: The debate wasn’t really about marriage law technicalities but about recognition, dignity, and social values.

Speed of social change: In just 13 years (2004-2017), Australia went from explicitly banning same-sex marriage to legalizing it with 62% support.

Conscience votes versus party discipline: The Coalition’s conscience vote approach delayed reform. Once Labor imposed party discipline (supporting it), the dynamic shifted.

International context matters: Momentum from overseas (especially similar countries like UK, NZ, Canada) put pressure on Australia.

Campaign framing: YES campaign’s positive framing (“love is love”) was more effective than NO campaign’s fear-based messaging.

Implementation can be simple: Unlike NDIS or carbon pricing, changing marriage law was straightforward once legislated.

Policy finality: Unlike carbon pricing, marriage equality has proven politically irreversible. No serious proposals to repeal it.

Case Study 5: JobKeeper (2020)

Crisis policy making at unprecedented speed

Agenda Setting - Crisis Response (March 2020)

This is the most compressed agenda-setting in Australian history:

Timeline:

• January-February 2020: COVID-19 emerging in China, arriving Australia
• March 2020: Pandemic declared, lockdowns beginning globally
• March 15-20, 2020: Australian economy essentially stopping

The crisis:

• Businesses closing overnight
• Mass layoffs imminent (hundreds of thousands of jobs)
• Unprecedented peacetime economic emergency
• International borders closed March 20
• States beginning lockdowns

Political context:

• Morrison government (Liberal/National Coalition)
• Had opposed large government intervention in economy
• Faced choice: massive unemployment or massive intervention
• Treasury scrambling to model impacts

By mid-March 2020, preventing economic collapse became the only agenda item.

Policy Formulation (March 20-30, 2020)

Incredibly rapid design—about 10 days:

Treasury and Prime Minister’s office designed JobKeeper in around a week:

Key decisions:

• Wage subsidy model (not individual unemployment benefits)
• Keep employer-employee relationship alive
• Flat rate: $1,500 per fortnight per employee
• Eligibility: businesses with 30%+ revenue decline (50% for large businesses)
• Cover employees and some sole traders
• Run for 6 months initially (later extended)
• Estimated cost: $130 billion (later revised)

International context:

• Looking at UK’s furlough scheme, Canada’s CERB
• But Australia’s was more generous in many ways
• Had to design for Australian context (casual workers, sole traders)

Consultation:

• Very limited time for normal consultation
• Business groups involved informally
• Union movement involved
• But essentially executive decision under crisis conditions

Design challenges addressed:

• How to verify revenue decline quickly?
• How to get money flowing fast?
• How to avoid fraud while moving quickly?
• How to cover casuals (many had no job security)?
• What about universities, councils, childcare?

Decision Making (March 30, 2020)

Announcement: March 30, 2020

• Scott Morrison and Josh Frydenberg (Treasurer) announced JobKeeper
• Bipartisan support from Labor (Anthony Albanese)
• Minor criticisms around edges (some workers excluded)
• Overwhelming public support

Parliamentary passage:

• Legislation passed April 8, 2020
• Both houses passed it with bipartisan support
• Some amendments to expand coverage (Labor negotiated including more casuals)
• Extraordinary cooperation given usual partisan conflict

Political consensus because:

• Genuine crisis
• No time for partisan games
• Both sides knew economic disaster would hurt everyone
• International precedents made it “acceptable” for conservative government

Implementation (April 2020 - March 2021)

Phase 1: April-September 2020

Getting money flowing:

• Payments began flowing late April (remarkably fast)
• Administered through ATO (Australian Tax Office)
• Businesses claimed for employees, passed it on
• $1,500 per fortnight per eligible worker

Scale:

• Initially ~3.5 million workers covered
• ~960,000 businesses participated
• About 30% of workforce at peak

Early problems:

• Some workers excluded (temporary visa holders, casuals under 12 months)
• Some businesses gamed system
• University casuals largely excluded (controversial)
• Some businesses claimed for workers they kept anyway (windfall)

Major error discovered:

• May 2020: Treasury realized it had overestimated take-up
• Revised cost from $130 billion to $70 billion
• Embarrassing but actually good news

Phase 2: October 2020 - March 2021

Tapering:

• October 2020: Rate reduced to $1,200/$750 (depending on hours)
• January 2021: Further reduced to $1,000/$650
• March 28, 2021: JobKeeper ended

Rationale for tapering:

• Economy recovering faster than expected
• Fiscal sustainability concerns
• Avoid dependency

Controversy:

• Many argued ended too soon
• Some sectors (tourism, international education, arts) still struggling
• Others argued it was being rorted and needed to end

Evaluation (ongoing)

Successes:

Economic stabilization:

• Prevented catastrophic unemployment spike
• Unemployment peaked at ~7.5% (predicted to hit 15%+)
• Maintained employer-employee relationships
• Enabled quick recovery when restrictions lifted
• Consumer confidence maintained

Administrative achievement:

• Designed, legislated, and implemented in weeks
• Money flowing within a month of announcement
• ATO processed millions of claims

Social impact:

• Prevented personal hardship for millions
• Maintained income for renters (prevented eviction crisis)
• Reduced mental health impacts of unemployment

Problems and criticisms:

Exclusions:

• Temporary visa holders excluded (controversial—many had been here years)
• Some casual workers excluded
• University casuals particularly hard hit
• Led to significant hardship for excluded groups

Windfall gains:

• Some businesses claimed JobKeeper but didn’t need it
• Revenue recovered but they kept payments
• Estimated $25-40 billion went to firms whose revenue recovered
• No clawback mechanism (unlike UK furlough)
• Some paid dividends and executive bonuses while claiming JobKeeper

Fraud:

• Some deliberate fraud (estimated relatively small)
• Some “gaming” (legal but questionable)
• ATO investigating but limited clawback

Timing of end:

• March 2021 arguably too early
• Some sectors still suffering
• But fiscal cost was enormous

Labour market distortions:

• Kept people in jobs that weren’t viable long-term
• Delayed necessary restructuring
• Though also prevented mass unemployment

Fiscal impact:

• Final cost: ~$89 billion (revised down from $130 billion)
• Along with JobSeeker supplement and other measures, total fiscal response ~$311 billion
• Largest peacetime fiscal intervention in Australian history
• Pushed budget into deficit (~$134 billion in 2020-21)
• Debt levels increased significantly

Long-term effects:

• Quick recovery vindicated intervention
• But debate continues about design flaws
• Treasury learned lessons about rapid policy deployment
• Changed expectations about government’s role in crises

Legacy and Policy Learning

What worked:

• Speed of design and deployment
• Wage subsidy model maintained employment relationships
• Bipartisan cooperation under crisis
• Using existing infrastructure (ATO) for delivery

What didn’t:

• Exclusions created hardship and inequity
• Windfall gains to some businesses
• Limited oversight and accountability in rush
• Lack of clawback mechanisms

Comparisons:

• More generous than JobSeeker (unemployment benefits)—intentional policy choice
• More generous than most international equivalents
• But also had wider exclusions than some countries

Policy debates sparked:

• Should there be a permanent wage subsidy scheme for crises?
• Should temporary visa holders be covered in future crises?
• How to balance speed versus accuracy in emergency policy?
• Role of fiscal policy in stabilization

What This Case Teaches Us

Crisis enables rapid policy change: Normal constraints (consultation, review, political opposition) evaporate in genuine emergencies.

Institutional capacity matters: ATO’s existing systems enabled rapid deployment. Without that infrastructure, couldn’t have worked.

Policy design under uncertainty: Treasury had to make huge decisions with terrible data. Got some things wrong (cost estimate) but overall design worked.

Speed versus accuracy trade-off: Moving fast meant mistakes (exclusions, windfalls) but delay would have cost jobs.

Fiscal orthodoxy is flexible: Morrison government abandoned decades of “budget surplus” rhetoric overnight when crisis hit.

Bipartisanship is possible: When crisis is real, partisan games stop (mostly).

Implementation details matter enormously: The exclusions (casual workers, visa holders) weren’t just technical details—they caused real suffering.

Windfall gains are hard to prevent: No way to predict which businesses would recover versus struggle. But lack of clawback was policy choice.

Exit is hard: Knowing when to end emergency measures is politically and economically difficult.

Path dependency: JobKeeper changed expectations about government support. Future crises will be judged against it.

Case Study 6: Murray-Darling Basin Plan (2007-2012)

Environmental policy meets water politics

This is one of Australia’s most complex and contentious policies—involving environment, agriculture, federalism, Indigenous rights, and competing economic interests.

Background - The Problem

The Murray-Darling Basin:

• Australia’s most important river system
• Covers 1 million km² (14% of Australia’s land area)
• Spans 4 states (Queensland, NSW, Victoria, SA) and ACT
• Produces ~40% of Australia’s agricultural output
• 2.3 million people depend on it

The crisis:

• Over-allocation of water (more extraction rights than water available)
• Environmental degradation (dying wetlands, algal blooms, low river flows)
• Competing demands: irrigation versus environment versus urban use
• Climate change reducing inflows
• Indigenous cultural sites threatened

Historical context:

• Water managed by states, not Commonwealth
• Over a century of ad hoc water allocations
• States competed to allocate more water (race to bottom)
• No coordinated management
• 1990s-2000s: Declining river health obvious

The Millennium Drought (1997-2009):

• Worst drought on record
• River flows at historic lows
• Lake Alexandrina (SA) nearly dried up
• Mass fish deaths, dying red gums
• Crisis atmosphere

Agenda Setting (2004-2007)

Failed earlier attempts:

• 1987-2004: Various intergovernmental agreements
• All failed to stop decline
• States wouldn’t agree to reduce allocations

The 2007 breakthrough:

Howard government (2007):

• January 2007: Howard announced $10 billion National Plan for Water Security
• Proposed Commonwealth takeover of Murray-Darling management
• Revolutionary—water was constitutionally state responsibility
• Drought crisis made it politically possible

2007 Election:

• Both Howard and Rudd committed to Basin reform
• Rudd won election (November 2007)
• Continued with Basin plan

Why it reached agenda:

• Visible crisis (dying river, drought)
• States had proven unable/unwilling to fix it
• Economic costs mounting
• Environmental groups campaigning for decades
• Scientific evidence overwhelming
• Political window: crisis + funding + willingness to use Commonwealth power

Policy Formulation (2008-2012) - The Long Struggle

Legislation - Water Act 2007:

• Passed December 2007 (with bipartisan support)
• Created Murray-Darling Basin Authority (MDBA)
• Required Basin Plan based on “best available science”
• Gave Commonwealth unprecedented power over water

The mandate:

• Determine environmentally sustainable level of take
• Return water to environment
• Cap extractions
• Balance environmental, social, economic considerations

The Guide (2010) - First Draft:

October 2010: MDBA released Guide to proposed Basin Plan

The shock:

• Recommended returning 3,000-4,000 gigalitres (GL) to environment
• This was 27-37% reduction in irrigation water
• Based on scientific assessment of environmental needs

The backlash:

• Regional communities erupted
• Public meetings in towns like Griffith, Shepparton
• Copies of Guide burned in streets
• Farmers argued it would destroy irrigation communities
• Predicted job losses: 800-4,000 (depending on study)
• SA wanted more water returned, upstream states wanted less
• Political firestorm

The problem:

• Science said environment needed significant water
• Communities couldn’t absorb that level of cuts
• States divided (SA versus NSW/VIC)
• Commonwealth caught in middle

Political crisis (2010-2011):

• MDBA Chair Mike Taylor resigned (October 2010)
• Criticized government for not backing scientific advice
• Gillard government under massive pressure
• Regional MPs (National Party) threatening revolt
• SA demanding environmental flows
• Environmental groups saying any compromise betrays river

Revision process (2011-2012):

New approach:

• Craig Knowles appointed new MDBA Chair
• More consultation with communities
• Looked for ways to achieve environmental outcomes with less water cuts
• Considered infrastructure efficiency improvements
• Focused on “environmental watering” strategies

The compromise:

• Reduced target to 2,750 GL return to environment
• Phased implementation (to 2024)
• $5.8 billion for water buybacks and infrastructure
• Offset programs for communities
• Environmental targets softened

Political negotiations:

• Windsor and Oakeshott (independents) crucial in Parliament
• National Party resisted but eventually accepted
• SA accepted reluctantly (wanted more)
• Environmental groups criticized as inadequate
• But enough support to pass

Decision Making (November 2012)

Parliamentary passage:

• Basin Plan passed Parliament: November 2012
• Not without drama—amendments, debates, protests
• Final vote: supported by Labor, opposed by Coalition in Senate (but passed with Greens support)
• Royal assent: November 22, 2012

What passed:

• 2,750 GL to be returned to environment by 2024
• Sustainable Diversion Limits (SDLs) set for each valley
• Water Recovery Program (buybacks and infrastructure)
• Environmental Watering Plan
• Annual reporting and adaptive management
• Socio-economic neutral or improved test (controversial—seemed to contradict environmental priority)

Implementation (2012-present) - Ongoing Struggle

Phase 1: Water Recovery (2012-2019)

Two mechanisms:

1. Water buybacks: Government purchases water entitlements from farmers
2. Infrastructure upgrades: Fund irrigation efficiency, save water for environment

Progress and problems:

Buybacks:

• Initially effective but became politically toxic
• Regional communities argued buybacks destroyed towns
• 2015: Coalition government (Abbott) capped buybacks at 1,500 GL
• Shift to infrastructure-only approach

Infrastructure programs:

• More politically acceptable (farmers get modern systems)
• But: expensive, some projects questionable value
• Some “water savings” illusory (return flows reduced)
• Became riddled with allegations of mismanagement

The “water theft” scandals:

• Media investigations revealed illegal water extraction
• Poor compliance and enforcement
• Some irrigators taking more than entitlements
• States not enforcing rules
• Undermined Basin Plan credibility

Political shifts:

Coalition government (2013-2022):

• Abbott/Turnbull/Morrison governments
• More sympathetic to irrigators
• Weakened some environmental protections
• Extended deadlines
• Favored infrastructure over buybacks

Controversial amendments (2018):

• Changed SDL targets for some valleys
• Extended timelines
• “Basin Plan Amendment”—effectively reduced some environmental targets
• SA threatened legal action
• Environmental groups furious

Phase 2: Recent Developments (2019-present)

Royal Commission (SA, 2018-2019):

• SA government held Royal Commission into Basin Plan
• Blistering report on Commonwealth failures
• Found plan not being implemented as intended
• Recommended legal action if Commonwealth didn’t comply

Inspector-General investigation (2020):

• Investigated water recovery programs
• Found $4 billion+ wasted on dubious projects
• Queensland and NSW projects that delivered little actual water savings
• Political scandal

Drought returns (2017-2020):

• Another severe drought
• Mass fish kills at Menindee (2018-2019)
• Revealed Basin Plan inadequate for climate change
• Environmental water couldn’t be delivered (not enough water)

2024 deadline missed:

• Basin Plan required 2,750 GL returned by July 2024
• Shortfall of ~700 GL
• Commonwealth granted extension to 2027
• Controversy continues

Current status (2024):

• About 2,100 GL recovered
• Still ~650 GL short of target
• Labor government (Albanese) committed to full implementation
• But states (especially NSW) resisting
• Buybacks restarted (controversial)
• Indigenous water rights increasingly prominent issue

Evaluation - Mixed Results

Partial successes:

• Commonwealth authority established (major institutional change)
• Some water returned to environment (though not enough)
• Reduced extractions in some valleys
• Some wetlands recovering
• Water market functioning better
• Climate adaptation starting

Significant failures:

• Targets won’t be met
• Environmental outcomes uncertain
• Community impacts not adequately addressed
• Compliance and enforcement weak
• States still not cooperating fully
• Climate change outpacing plan

Unintended consequences:

• Water markets concentrated ownership (investors, foreign companies buying water)
• Some communities devastated (Deniliquin, Shepparton)
• Indigenous people largely left out of water rights
• Perverse incentives in infrastructure programs

The fundamental tensions unresolved:

• Environment versus economy (still competing)
• State versus Commonwealth power
• Upstream versus downstream states
• Science versus politics
• Short-term pain versus long-term sustainability

What This Case Teaches Us

Wicked problems resist solutions: The Basin Plan tackled competing interests that may be fundamentally irreconcilable within current system.

Federalism complicates everything: Commonwealth-state tensions made design and implementation vastly more complex than if single government.

Science isn’t enough: The MDBA had clear scientific advice (3,000-4,000 GL needed) but politics made it unachievable.

Communities matter: The Guide’s failure showed you can’t impose major change without community acceptance, even if scientifically justified.

Implementation can undermine policy: Even when plan was legislated, implementation failures (compliance, poor projects, deadline extensions) meant objectives unmet.

Climate change is a moving target: The plan was based on historical flows that may no longer apply. Need adaptive management.

Long-term problems need long-term commitment: 15+ years and still not implemented. Political cycles and changing governments make sustained implementation difficult.

Regulatory capture risks: Irrigation interests heavily influenced implementation, weakening environmental outcomes.

Missing voices: Indigenous water rights only recently getting attention, despite First Nations’ millennia-long connection to rivers.

Crisis creates windows, but they close: The Millennium Drought enabled the initial legislation, but as drought ended, political will weakened.

Institutional design matters: MDBA was meant to be independent but proved vulnerable to political pressure.

Comparing All Six Cases

Looking across these cases, we can identify patterns in how policy making works in Australia:

Cross-Cutting Themes

Looking across all six cases, several fundamental patterns emerge about how policy works in practice:

1. Crisis Opens Policy Windows

Crisis moments create opportunities for major policy change that wouldn’t be possible in normal times:

• The Millennium Drought made the Basin Plan politically possible
• COVID-19 enabled JobKeeper to be designed in days
• Visible environmental disasters (fish kills, dying rivers) forced political action
• But windows close: climate policy collapsed after the carbon tax repeal

The lesson: Policy entrepreneurs need to be ready with solutions when crisis hits, because the window won’t stay open long.

2. Framing Is Critical

How a policy is labeled and discussed matters as much as what it actually does:

• “Carbon tax” versus “emissions trading”—same policy, completely different political fate
• “Marriage equality” versus “gay marriage”—language shaped public perception
• “Insurance” scheme versus “welfare” (NDIS)—the insurance frame was politically crucial
• “Plain packaging” versus “removing branding”—public health frame helped it succeed

The lesson: Technical policy details matter less than the narrative framework around them.

3. Implementation Can Make or Break Policy

Even well-designed policies can fail if implementation goes wrong:

• NDIS: Good idea on paper, but implementation struggles nearly destroyed it
• Basin Plan: Legislated but never properly implemented, so effectively failed
• JobKeeper: Rapid implementation succeeded despite design flaws
• Marriage equality: Simple implementation, smooth rollout
• Carbon pricing: Implemented fine technically, but political opposition killed it
• Tobacco: Smooth implementation helped it survive legal challenges

The lesson: “Implementation is policy”—street-level bureaucrats and administrators effectively make policy through daily decisions.

4. Federalism Matters Enormously

Australia’s federal system creates unique challenges:

• NDIS required complex federal-state negotiations that took years
• Basin Plan nearly impossible due to competing state interests
• Carbon pricing was easier because it was federal power
• Marriage equality was straightforward because it was federal jurisdiction
• JobKeeper complicated by state differences in COVID response

The lesson: Policies requiring coordination across levels of government face exponentially more complexity.

5. Evidence Is Necessary But Not Sufficient

Having good evidence doesn’t guarantee policy success:

• Tobacco had overwhelming health evidence → passed and survived
• Climate had overwhelming scientific evidence → passed but then repealed
• Basin had clear environmental science → legislated but targets not met
• NDIS had strong moral case but weak cost modeling → massive cost overruns

The lesson: Evidence is essential for credibility, but political will and public support determine outcomes.

6. Political Cycles Versus Policy Timeframes

Mismatch between electoral cycles and policy impacts creates problems:

• Carbon pricing needed 10+ years to show results, faced election in 18 months
• NDIS needs decades to fully implement, faces 3-year political cycles
• Basin Plan needs 50+ years, governments change every 3-10 years
• JobKeeper was temporary by design, so avoided this problem

The lesson: Long-term policies struggle in short-term political environments.

7. Bipartisanship Helps But Doesn’t Guarantee Success

Cross-party support creates stability but doesn’t solve all problems:

• NDIS: Bipartisan support, but implementation still extremely difficult
• Basin Plan: Initially bipartisan, but still failed to achieve goals
• JobKeeper: Bipartisan support helped rapid deployment
• Marriage equality: Became bipartisan after postal survey, then succeeded
• Carbon pricing: Partisan division led to repeal

The lesson: Bipartisanship is valuable but doesn’t eliminate implementation challenges or guarantee results.

8. International Context Matters

Australia doesn’t make policy in isolation:

• Plain packaging: Australia led, others followed—international validation helped
• Marriage equality: Australia followed international trend—precedents from similar countries created momentum
• Carbon pricing: International failures contributed to domestic repeal
• JobKeeper: International coordination (with UK, Canada) helped legitimize massive intervention
• NDIS: Uniquely Australian, no international pressure
• Basin Plan: Uniquely Australian water politics

The lesson: International examples can legitimize or undermine domestic policy efforts.

9. Unintended Consequences Are Inevitable

Every policy creates unexpected effects:

• NDIS: Costs doubled, market gaming emerged, provider behavior changed
• Carbon pricing: Political toxicity destroyed climate policy for a decade
• JobKeeper: Windfall gains to profitable companies, exclusions caused hardship
• Basin Plan: Water trading led to ownership concentration
• Even successful policies like tobacco plain packaging had minor unintended effects

The lesson: Plan for adaptation, because surprises will emerge.

10. Policy Termination Is Easier Than Creation

Destroying policy is far simpler than building it:

• Carbon pricing: Years to design and legislate, months to repeal
• But some policies become institutionally embedded and politically irreversible
• Marriage equality: Now impossible to repeal
• NDIS: Too many beneficiaries and supporters to reverse

The lesson: Building constituencies and institutional structures can protect policies from reversal.

Lessons for Policy Practitioners

What can we learn from these six cases about making better policy?

On Design

1. Anticipate implementation challenges early: NDIS shows that design on paper differs from reality on the ground
2. Build in adaptive mechanisms: Climate change made Basin Plan targets obsolete; need flexibility
3. Consider political sustainability: Carbon tax shows even good policy fails if politically toxic
4. Test assumptions through trials: NDIS trials revealed problems before full rollout
5. Frame carefully from the start: “Tax” versus “price” completely changed carbon policy fate

On Process

1. Invest in consultation: Basin Plan’s “Guide” failed because community buy-in was insufficient
2. Use crises wisely: JobKeeper shows rapid policy is possible, but window closes quickly
3. Build coalitions early: Marriage equality succeeded partly because advocacy was organized
4. Don’t let perfect be enemy of good: NDIS launched imperfectly but has improved over time
5. Plan for long implementation: Quick legislative wins don’t mean quick implementation

On Politics

1. Bipartisanship helps longevity: NDIS survived government changes; carbon tax didn’t
2. Manage expectations: NDIS cost blowouts partly from unrealistic initial projections
3. Prepare for opposition: Plain packaging won because government anticipated legal challenges
4. Don’t rely on compensation alone: Carbon tax showed compensation doesn’t overcome perception
5. Build constituencies: Policies with beneficiaries are harder to reverse

On Implementation

1. Use existing institutional capacity: JobKeeper worked because ATO infrastructure existed
2. Monitor and adapt continuously: NDIS shows need for ongoing adjustment
3. Enforce compliance seriously: Basin Plan undermined by poor enforcement
4. Communicate clearly and often: Public understanding matters for sustainability
5. Plan exit strategies: JobKeeper’s tapering was controversial but necessary

On Evaluation

1. Measure what matters: Not just inputs and outputs, but actual outcomes
2. Be honest about failures: Basin Plan shows denying problems makes them worse
3. Learn from mistakes: JobKeeper exclusions teach lessons for next crisis
4. Accept uncertainty: Climate policy shows perfect knowledge isn’t achievable
5. Build in review mechanisms: Regular evaluation enables course correction

Conclusion

These six cases demonstrate that policy making is inherently messy, political, and unpredictable. There’s no formula that guarantees success. The same factors that enabled NDIS (bipartisan support, strong advocacy, clear need) also characterized the Basin Plan, which largely failed. The carbon pricing scheme had solid evidence but collapsed politically, while tobacco plain packaging with similar evidence succeeded.

What does work?

• Clear problems that the public recognizes
• Political will to act, not just talk
• Sound evidence to guide design
• Realistic expectations about costs and timeframes
• Adaptive implementation that learns and adjusts
• Sustained commitment across political cycles
• Careful framing that builds public support
• Institutional capacity to deliver
• Attention to detail in design and implementation
• Learning from failure rather than denying it

But even with all these elements, success isn’t guaranteed. External shocks (like COVID), political changes, implementation failures, and unintended consequences can derail even well-designed policies.

The art of policy making lies in navigating this complexity—using evidence where possible, building political support where necessary, designing for the real world not the ideal world, and staying adaptable when things inevitably don’t go according to plan.

Australian policy making over the past two decades shows both the potential and the limits of government action. Major reforms like the NDIS have transformed lives despite implementation challenges. Crisis responses like JobKeeper prevented economic catastrophe. But failures like the carbon tax repeal and the Basin Plan show that good intentions and sound evidence aren’t always enough.

The challenge for the next generation of policy makers will be learning from both the successes and failures documented here. In an era of climate change, technological disruption, and social transformation, Australia will need better policy making than ever before. These six cases provide a roadmap—not of what to do, but of what to expect and how to think about the inevitable challenges ahead.

Policy making is ultimately about choices: between competing values, limited resources, uncertain futures, and imperfect options. Understanding how those choices have been made in the past—what worked, what failed, and why—is the best preparation for making better choices in the future.