It was the one bit of theatre at the Melbourne Festival that seemed worth a glance, but still you wondered: a production of Ibsen’s An Enemy of the People, the play about the just man who falls foul of the town when he discovers the baths, the town’s primary attraction, are making people sick, from the renowned and much-feared Schaubühne of Berlin. That’s the company of Thomas Ostermeyer that brought the Sydney Festival the Hamlet in a fat suit and the Hedda Gabler in Melbourne last year that seemed conceived for a smaller space in which these sketchy reductions of Ibsen’s characters could whisper their affectless juvenile imitations of an adult destiny. And, God knows, there are moments in the Australian theatre when the Germans seemed to have established a 1,000-year reich of postmodern self-intoxication: Barrie Kosky when he seems lost in cavalcades of privacy, Benedict Andrews when the confetti just falls and falls like the gilded butterflies of the director’s sense of election, Simon Stone when he’s improving other people’s masterpieces as if the zenith of interpretation were not possible without textual reshaping — all of this is a monument to German progessivism and, although the influence tends to fall on people of some talent, as an influence it can seem like a mindless aping of a misapprehended mannerism. Besides, the Germans themselves talk about postdramatic theatre as if they wanted to nullify the boards on which they tread.

So what hope for this minor-key Ibsen about pollution in a provincial town? Well, the good news is that An Enemy of the People is a testament to the rigour and licence of Ostermeyer’s aesthetic and it is also a triumph. It is radically modernised, with electric guitars on stage and David Bowie songs, and the script is both tapered and scribbled over with contemporary idiom, but at the core of this production there is a burning and rather brilliant reanimation of Ibsen’s drama, shorn of some of its lumbering humanistic piety.

The audience at the second performance, the first properly at night, were an arty lot. There was Jack Hibberd, the author of some of the nation’s better plays, laughing with dread about the interval-less two-and-a-half hours ahead of us. And the man who gave one of the greatest performances ever on the Australian stage, in his first stab at Hibberd’s Monk O’Neil in A Stretch of the Imagination, Max Gillies, was there with his wife Louise Adler, the MUP publisher fresh from her triumph of slaying the MLC headmistress.

An Enemy of the People is Ibsen’s dialectical foray into the horrors of small-town controversy. A naturally unworldly, passionately serious character, Dr Stockmann, discovers the spa is actually making its visitors sick. His brother Peter, the mayor, and then all the town notables, particularly the editor of the local newspaper and his henchmen, gradually turn against him. His wife remains loyal, but on the sidelines there is the charismatic figure of his father-in-law, who cares about nothing but turning a profit.

An Enemy of the People is a very good play without representing the zenith of Ibsen’s achievement, in either the Peer Gynt epical or the Hedda Gabler tragic direction. It is a play that spins on the paradigm of politics and casts a pessimistic light on the idea of democracy. It was very popular during the Cold War period because its highlighting of the individual of integrity who stares down the mob suited the ethos of the age that threw up The Crucible in the face of McCarthyist extremism, and perhaps it has new pertinence at a time when climate change and terror and financial crises are all the go.

Ostermeyer’s production takes to the play with a scalpel but preserves its heart. The dialogue is unswervingly contemporary — and, I’m told, in a very crisp idiomatic German, beautifully projected — and the ethos is Euro-hip (an improvised rock group rehearsing at the doctor’s place with the journalist Hovstad on electric guitar). It seems at first a bit swaggeringly bohemian but then the local politician brother (Ingo Hülsmann) appears and we realise we’re in a place where different worlds meet.

And the performances are beautifully scaled, they’re full of subtlety and understatement and finicky gestures. Stefan Stern’s Stockmann is youthful and intense but there’s a precision in the way he conveys what turns, by necessity, into a political obsession that’s completely credible. And Hülsmann as the central town council bad guy is given plenty of good semi-feasible lines that give the devil’s case a shade more plausibility than it has in Ibsen. But this is a production with a superb ensemble. Eva Meckbach is authentically abashed and frightened as Mrs Stockmann. Christoph Gawenda’s journalist is rueful enough when his conscience collapses and David Ruland as Aslaksen, the worldly editor, never loses the face of conviction. There is also a superb performance — a touch more fruity and resonant, but perfectly judged — by Thomas Bading as the father-in-law Morten Kiil, who wanders about with a truly beautiful Alsatian who wordlessly exemplifies the magnificence of a world that does not surrender to raw principle.

The rawness of the principles is carried to the point of self-parody (and beyond) in the adaptor Florian Borchmeyer’s savagely nihilistic rewrite of Stockmann’s speech to the town which assails every societal and familial piety in sight with a Baader Meinhof vehemence and very luvvy-ish hyperbole (though Stern’s delivery of it is utterly nervy and authentic). This leads to the theatre with the lights up turning into a town meeting and with the audience doing its predictable best to duplicate the idiocies of the crowd. The Melbourne Festival’s showoffs obliged counter-intuitively (in broad agreement with Stockmann’s vaunted leftist inanities) but this worked like a dream anyway. And the scene in which Stockmann’s opposition turn into a mob and hurl paint at him from every direction was a dazzling coup de théâtre — utterly simple and utterly brilliant.

An Enemy of the People is superb theatre and it has a bedrock of emotional reality and a riveting command of verbal and visual detail that puts the Antipodean imitators of German theatre to shame. This is a theatre full of realism and restraint, for all the slashing brilliance of its big moments.