Fascinated by fairness

By Jacqui Maley

Ann Harding’s pioneering research shows the impact of economic policies in dollars and cents.
Image of Ann Harding

“I have always been interested in how the numbers come out,” says Ann Harding, as she sits in her office in a building named after her, nursing a mug of tea and pondering the question of why she has devoted her life to applied economics.

“Someone who had done sociology might be equally passionate, but they can’t tell you how many millions of dollars it would cost to reduce poverty by, say, five per cent.

“Whereas the stuff we do, we can give you numbers about how much particular outcomes might cost you in either lower taxes or increased outlay. I was always interested in giving data that helped support decisions.”

As the founder and inaugural director of the National Centre for Social and Economic Modelling (NATSEM), Professor Harding has channelled that interest into the creation of Australia’s first micro-simulation research outfit.

Before Harding brought micro-simulation to Australia, having completed a PhD on it at the London School of Economics in 1990, politicians and policy-makers had no life-like picture of how their policies might actually look once implemented.

Now they do. NATSEM is a gold mine for policymakers, who can give its researchers a certain idea – for example, an increase in the aged pension, or a cut to superannuation contributions tax – and have them simulate its effects on real people in the real world. Instead of using statistical averages, researchers get a more accurate result by using the real-life circumstances of the tens of thousands of people surveyed in detail by the Australian Bureau of Statistics.

Harding completed her Bachelor of Economics at Sydney in 1979 and returned in 1983 for her Honours degree. As a student she witnessed the ideological split in the Economics department between academics interested in orthodox economics and those who wanted to branch out into political economy, and lived in a series of cockroach-infested “hovels” in Redfern and Newtown.

"Researchers use the real-life circumstances of the tens of thousands of people surveyed in detail by the ABS."

Harding claims she was, and is, “really bad” at theoretical economics but was always “fascinated by questions of equity and fairness”, a passion she initially thought was best channelled into journalism. So in the final year of her undergraduate degree, she accepted a cadetship with the now-defunct National Times.

Harding’s first story was what is known among journos as a “good get”. She won the first interview with a Federal MP who wanted to end the Medicare subsidy for abortions. Once she finished the interview (she had called the politician reverse-charges from home), Harding walked down the road to the National Times, in the old Fairfax building on Broadway, and told her editor, Paul Kelly, that she thought she might have a story. “He pointed to a typewriter and said: ‘This is copy paper. Write it’,” she recounts.

Putting the intellectual effort in

Harding glows when she talks about the “amazing” feeling of seeing her first-ever byline, but the buzz must have worn off because journalism failed to keep her. “I felt I was getting de-skilled … reporting other people’s thoughts as a cipher without putting my own intellectual effort in.”

She left the paper to work as a legislative researcher in Parliament House, thereby setting herself on a trajectory which saw her involved in the great social and economic reforms of the last two decades: from the GST to the reform of the child support payments system, superannuation changes, and the economic conundrum of how to support an ageing population.

Her centre does modelling for government agencies like Treasury, but also for corporations including AMP, political parties and Senate committees. As such, the results of Harding’s research often become part of the political debate, a side to the job she finds stressful.

In 1999, during the lead-up to the introduction of the GST, Harding and her team were commissioned by a Senate Committee to model the impacts of the controversial tax. They then had to appear before a Senate inquiry to present and defend their research.

“They were all unhappy with the report we’d done,” she laughs. “The ALP were unhappy because there weren’t that many losers. The Liberals were unhappy because there were some losers, and the Democrats were unhappy because we modelled an option where you put food into the tax base as well. So that was by far the most fraught experience … and it was all being televised.”

In 2009, Harding stood down as director of NATSEM to concentrate on research, but not before she secured $11 million in federal government funding for the centre’s elegant new digs on the University of Canberra campus. The university’s Vice-Chancellor named the building after her, something she finds gratifying, but also, one suspects, a little embarrassing, for the same reason she doesn’t want to appear on television, and chose academe over a flashier career in journalism.

Because what she is most interested in is how the numbers come out.