EDITORIAL : THE AUSTRALIAN, AUSTRALIA

Fine line on managing ash

ANOTHER reminder - this time from Mother Nature, not technology - of our interconnected world. The Chilean volcanic ash that travelled more than halfway around the globe to disrupt Australians' long-weekend travel underlines how dependent we are on the latter and how humbled we can still be by the former.

When a similar eruption occurred in Iceland last year, authorities took the unprecedented action of closing air space across Europe. In Australia, Qantas was criticised by some as overly conservative when it cancelled some flights to Europe. But it was no surprise this time around, with the ash closer to home, that Qantas and Jetstar led the way on Sunday by halting flights. The huge backlog of passengers plus the chance of further closures today mean that this event will be costly for the airlines and will require all their skills in disaster management. Unpredictable events, such as volcanic eruptions, can have a devastating effect on the best business plans and the ash cloud could not have come at a worse time for an aviation sector under pressure from fuel costs and still recovering from the global financial crisis.

Modern consumers who have grown used to regular, easy air travel may baulk at the disruption, but it is difficult to see that the airlines had any other option but to err on the side of safety.

A win for Turkish democracy

TURKEY'S voters were probably wise not to give Prime Minister Recep Tayyip Erdogan the two-thirds majority he wanted to amend the constitution unilaterally, but the result of the general election nonetheless represents a major shot in the arm for democracy in a country still emerging from a dark past of military coups.

More than that, Mr Erdogan's success in leading his Justice and Development Party (AKP) to a record third straight victory in a highly strategic country in the East-West equation that plays a particularly influential role in the Islamic world will inspire those striving for democracy in places such as neighbouring Syria that there is an alternative to dictatorship and jackboot military rule.

Mr Erdogan has his critics. He is seen by many to be far too thin-skinned, suing or threatening even the mildest of critics. Though he denies it, some accuse him of being a closet Islamist who has compromised the secularism of the founding father of modern Turkey, Mustafa Kemal Ataturk.

In the 10 years he has been in power, Mr Erdogan, who now becomes the longest-serving Turkish leader since Ataturk, has, through a blend of economic liberalism and religious conservatism, led a remarkable transformation of his country from one that was constantly prey to military coups and an economic basket case to one that is a democracy boasting a growth rate of 9 per cent, second only to China's and higher than India's, and exerting unprecedented influence in its own region and internationally.

Turkey matters on the world stage now in a way it never did when the generals ruled the roost. Mr Erdogan deserves praise for the way he has sidelined them and successfully entrenched democracy. The next stage in this process, he believes, is to rewrite the military-drafted constitution, creating an executive, French-style presidency, a job he is said to covet. Had he won the two-thirds majority, he would have been able to make the changes unilaterally. Now he has to negotiate with opposition parties, and has pledged that he will draw up a new constitution through consensus and negotiation, something that should further assist the cause of democracy.

Beyond this, there are other challenges confronting Mr Erdogan that will test to the full Turkey's historic role as a bridge between East and West and its proximity to the upheavals taking place across the Arab world. Already, Turkey is suffering a sidewash effect from the tumult in Syria. To its credit, it has opened its borders to refugees fleeing the horrendous human rights outrages being perpetrated by the Baathist regime in Damascus.

Syria, indeed, should serve as a lesson for Mr Erdogan, who has, despite Turkey's membership of NATO and its application to join the EU, been attempting to pursue a more independent foreign policy that has sometimes strained traditional relations with the US and Israel, taking a hard line against the Jewish state. Given his own success with democracy, Mr Erdogan should be taking a different tack, for the only other democratic country in the region is Israel and he ill-serves the cause of democracy by siding with those who seek its destruction.

The standout success of democracy in Turkey owes much to Mr Erdogan's leadership. He should not shy away from supporting the democratic cause elsewhere, especially in his own region.

States must contain public sector wage pressures

STATE governments are grappling with a difficult balancing act as they strive to contain public sector wage bills.

Wage costs need to be held to the inflation rate, currently 2.9 per cent, or less if budget deficits are to be reduced and funds freed up for infrastructure. At the same time, serious shortages of nurses, specialist teachers, police and other essential service personnel compel governments to offer competitive wages to frontline staff. It is unhelpful that state budgets are being delivered at a time when the Gillard government's industrial system is making unions bolder and driving wages pressures in key sectors. In Victoria, for example, the militant Construction Forestry Mining and Energy Union has bagged a 27 per cent pay hike over four years for construction workers without productivity improvements.

As state treasurers struggle to prevent their wages bill from escalating by more than $4 billion in the 2011-12 financial year, they should focus on keeping their bureaucracies as pared down and efficient as possible. And while they need to protect the interests of frontline staff, there is no need to send their budget bottom lines deeper into the red with pay deals well above the inflation rate. The push by Victoria's state teachers for a rise of 10 per cent a year, for instance, defies reason. The 5 per cent annual increase for three years being sought by NSW police is also out of kilter with inflation.

As current enterprise deals expire and are renegotiated, it is important that wage and superannuation rises are linked as closely as possible to productivity improvements. Outstanding work performance deserves financial recognition, which is why the sooner the best classroom teachers are rewarded with the merit pay bonuses announced by the Gillard government, for example, the better Australia's public schools will be.

The South Australian government has shown commendable resolve in forcing through unpopular job cuts. In Queensland, Treasurer Andrew Fraser, who is battling to restore the state's AAA credit rating, also has the right idea targeting 3500 positions within the non-frontline public sector under a "voluntary" job cuts program. A similar strategy could be adopted in all states and territories without a noticeable loss of services to the public.

NSW Premier Barry O'Farrell is pursuing a fiscally responsible strategy in seeking to cap public service pay rises to 2.5 per cent, unless offset by savings. Mr O'Farrell can expect a protracted legal battle, possibly all the way to the High Court, over his legislation to take control of public sector wages. If he is to succeed, his legislation will need be to watertight in regard to the NSW government's constitutional and legal rights.

While some view his approach as heavy-handed, the outcome will be watched closely by other states and comes after years of public sector unions calling the tune in NSW on wages and conditions and much else. The fact that ferry workers pocketed $10,000 more than teachers and blocked the sale of Sydney Ferries under Labor was a prime example.

If governments are to keep pace with taxpayers' demands for better services, they must take firmer control of their payrolls, which are their biggest running costs.