Former Victorian premier John Cain dies aged 88 

Former Victorian premier John Cain has died aged 88 after suffering a stroke earlier this month.

Cain was Labor’s longest serving premier in Victoria and was in power for three terms from 1982 until 1990.

He will be remembered as a principled and reformist premier whose decade of power ended in tears.

Despite winning three elections, he never tamed the factions or the unions.

Former Victorian premier John Cain has died aged 88 after suffering a stroke. He is pictured at a funeral in 2014

He fell out of step with the prevailing economic orthodoxy and his government, perhaps unfairly, was blamed for a series of financial disasters – most notably Tricontinental and the Pyramid group of building societies.

Also, perhaps just as unfairly, he was seen as a boring wowser whose idea of a good Saturday night was to stay home and sort his sock drawer.

John Cain, who died on Monday, December 23, 2019, aged 88, after suffering a stroke earlier this month, was born in Melbourne on April 26, 1931, in the midst of the Great Depression.

He, more than any, learned as a youngster how tough the lot of a Victorian Labor premier can be.

His father John ‘Jack’ Cain, was a passionate, turbulent Labor premier who was twice thrown out of office – by a reactionary upper house in 1945 and by the split in 1955.

The son was described as ‘his father writ small’.

He had a brief and unhappy stay at the posh Geelong Grammar. About his only mate was Rupert Murdoch, whom he remembers as the school ‘comm’.

After a somewhat happier time at Scotch College, he did a law degree at Melbourne University.

In 1955, he married Nancye Williams. They had two sons, John and James, and a daughter, Joanne.

Cain came to prominence as a leading member of the Participants, which tried to break the power of the Socialist Left in Victorian Labor politics.

The Participants helped engineer federal intervention that curbed the Left, but didn’t end the faction fighting.

In 1976 the factionally unaligned Cain entered the Victorian parliament as member for Bundoora, having lost an earlier preselection battle to Frank Wilkes.

Four years later he replaced Wilkes as Labor leader in a bloodless coup, and in 1982 he defeated the Liberals under Lindsay Thompson.

This ended 27 years of Liberal rule, with Cain becoming the first Labor premier since his father.

Cain was a pragmatic reformist who tried to retain Labor principles.

For about a term and a half, his government, according to the editors of Trials in Power, a study of the Cain and Kirner governments, put in place one of the most extensive programs of political and economic change anywhere in post-war Australia.

These included reforms in urban planning, conservation and national parks, occupational health and safety, adoption laws, disability services, educational opportunities, affirmative action, public authority accountability, prostitution, liquor and freedom of information.

Inner Melbourne was revitalised – lights for the MCG, Southbank turned into a cultural precinct, the tennis centre.

Cain himself has said his government probably did more than Don Dunstan, South Australia’s great reforming premier, in terms of social change.

But increasingly he faced bitter opposition – from unions over the MCG, from shooters over his determination to tighten gun laws following the Hoddle Street massacre, from councils over his moves to amalgamate them.

It got more difficult in the third term, particularly over his determination to modernise Melbourne’s public transport – with automatic ticket machines and trams without conductors – which was bitterly opposed by the unions and the Left.

It’s striking that in his memoir, he scarcely mentions the Liberal opposition, but writes at great length about his problems with the unions, the factions, and the federal Labor government, particularly then-treasurer Paul Keating.

Part of his problem was his belief that Victoria didn’t get its fair share of money from Canberra.

It was exacerbated by his belief in the efficacy of government intervention in the economy, which put him at odds with the economic rationalist orthodoxy in Canberra.

Cain’s main instrument was the Victorian Economic Development Corporation , a Liberal creation. Under Labor, it provided more financial assistance to firms and took equity in some of the businesses it supported.

To the feds, this was the heresy of picking winners and backing losers; and made them unsympathetic when Victoria needed help.

Although VEDC backed many successful ventures, there were failures and bad debts after the 1987 stock market crash; though according to one study, its record of about $100 million lost from $300 million outlayed was no worse than that of contemporaneous private venture capital funds.

However, it was – with a huge shortfall in its workers’ compensation scheme – the first major dent in the government’s economic management reputation.

Worse followed, with the failure of Tricontinental, a subsidiary of the State Bank of Victoria, which specialised in speculative lending.

By the time the successor Kirner government cut its losses by selling the State Bank to the Commonwealth Bank in 1990, Tricontinental’s losses were more than $2 billion.

Politically, the collapse of the Geelong-based Pyramid group was even more catastrophic, with $1 billion in deposits, the savings of tens of thousands of Victorians, frozen in June 1990.

Cain and his government copped most of the blame for these disasters.

However, a royal commission into Tricontinental later cleared the government of wrongdoing, while saying hard things about the Reserve Bank’s inadequate supervision.

Cain said the common thread was greed in a climate of rapidly expanding money supply and ever-rising interest rates.

Beset by the financial disasters and a transport strike and feeling undermined by the Left, Cain resigned as premier in August 1990.

His successor, Joan Kirner, led Labor to a massive defeat in 1992.

Cain was a man of great personal integrity. He may not have been a charismatic leader, but he wasn’t the wowser of mythology. He enjoyed a glass of wine and a bet.

He led a government that made Victoria a better place to live in – until he was overwhelmed by enemies from within and by forces that neither he nor almost anyone else at the time fully understood.

Cain is survived by his wife and children. He will be farewelled in a private funeral in coming days, his family said in a statement.