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Day to Day Politics: To the pub test you can add Malcolm’s fairness test.

Monday 11 April 2016

Malcolm Turnbull has, since he become Prime Minister, has used the word fair extensively. If you read the following quotes you would, I think, conclude that the man has a fair (pardon the pun) idea of the meaning of fairness. In fairness he is talking about tax reform but it’s fair to assume that his appreciation might extend to other areas.

His talk of tax reform and the fairness of it began soon after taking office and people were overwhelmed with his radical approach which seemed so unlike a conservative one.

Let’s take a look at what he was saying:

A Prime Minister Malcolm Turnbull has declared fairness “absolutely critical” to future economic reform in Australia.

B “A reform package must, at the very least, raise the revenue we need, share the burden fairly across the community and do so in a way that incentivises employment, investment and innovation,” he told the audience.

C The Prime Minister said taxation reform must be fair, or it won’t be supported.

D Malcolm Turnbull: ‘burden of tax is best borne by those able to pay it’

E Malcolm Turnbull says the fairness test in his looming tax reform package will be whether people with more resources pay more than people with fewer resources.

F “Fair is obviously in the eye of the beholder, but fair, I think, for Australians, means that the burden of tax is best borne by those able to pay it,” the prime minister said.

G “We have an egalitarian tradition and I think the test of whether any set of measures is fair is whether people look at it and say, yep, that’s fair enough.”

H PM uses key speech to put fairness centre stage in economic approach

I “Fairness is absolutely critical,”

J Mr Turnbull told the Melbourne audience the Government’s overall goal is a “high wage, generous social welfare net, first world economy” where the burden would be shared.

K “The object of the taxation system is plainly to raise the revenue the government needs for its services it provides,” Mr Turnbull said. The Prime Minister said any reform package the government proposed would have to raise the revenue it needed, while sharing the burden fairly across the community.

L “Fairness is absolutely critical. Any package of reforms which is not and is not seen as fair will not and cannot achieve the public support without which it simply will not succeed,” Mr Turnbull said.

The familiar phrase “Everything is on the table” was bandied about but no sooner were they on than they were off. The only remaining reform possible is some tinkering at the edges of superannuation. And that might only be cosmetic.

Over five months the government has made such a mess of its economic policy that it has backed itself into a corner where its future will be judged on the fairness of its next budget.

Never in my lifetime of following politics has a government so unambiguously placed itself in a position where it will rely on a budget to determine its future. One that has to not only be fiscally tough, fair and responsible, reflecting a narrative for the future, but it must be popular at the same time.

Cutting spending is the answer according to Treasure Morrison. The big money is in the areas of social welfare, education, health and overseas aid. There is still social welfare money in the universally condemned and unfair budget of 2014. Education, health and overseas aid have already been hit for six so any further cuts will have to result in dramatic cuts to services.

They are proposing a cut in tax for business without consideration to cuts for the average citizen who pays PAYE tax.

And this all has to be done against a backdrop of the rich and privileged taking advantage of tax breaks either provided by government, obtained by unscrupulous means or simply paying none.

Large financial institutions who because of their importance to the economy are treating the public like gullible fodder to ever increase their obscene profits are under public scrutiny. Everywhere there is corruption, the Panama papers will soon name the 800 Australians allegedly evading tax, also in politics, in the banking and financial sectors, political donations, the misuse of parliamentary expenses, corporate bribery, but the Government seems only interested in addressing corruption that will enhance its prospects of re-election.

They say that regulators like ASIC have more power than a Royal Commission, that our banks are the most regulated in the world but cannot explain how if that is the case, scandals keep on keeping on.

I wonder if the banks would pass his fairness test on credit card rates for example or fines for being overdrawn.

“The critical thing here is that the high standards of putting the customer first, of ensuring that the trust of the community is justified,” Turnbull said. “That requires leadership from senior bank managers and they are providing that leadership and they will provide more. We have a strong regulatory structure to do that.”

The word unfairness has struck a lingering chord with the electorate. An electorate that applies the pub test to everything. Now they have Malcolm’s fairness test. They are now asking questions. Why does the Treasurer and the Prime Minister lie so much about the economy?

Why are they so unable to tackle tax reform in a way that is fair and equal for all Australians? It’s simple really. All of the taxes where a substantial difference could be made happen to be in areas where the rich and privileged are advantaged with taxpayers funds.

Morrison is now faced with presenting a third Coalition budget while at the same time major cost savings from 2014 have not passed the senate. It would not surprise if he has the gall to carry over the savings. Surely that must be fiddling the books.

The problem for Morrison is that ideology forbids the raising of new taxes or for that matter taking away taxpayer funded subsidies already handed out. It is anathema to them. And of course further cuts to health, education and welfare would be unpalatable by the electorate.

Turnbull’s grandiose talk, when attaining power about tax reform has petered out to nothing.

This budget will be judged on its fairness. The only way that can be achieved is, well let me quote Turnbull.

“A reform package must, at the very least, raise the revenue we need, share the burden fairly across the community and do so in a way that incentivizes employment, investment and innovation,”

I don’t believe for one moment they can deliver a budget that is good for the country without putting their instincts for survival first.

My thought for the day.

‘In the recipe of good leadership there are many ingredients. Popularity is but one. It however ranks

far below getting things done for the common good’

PS. Interesting comment from a Facebook friend Lee Mullin to my thought for the day, yesterday.

“We exercise our involvement in our democracy every three years by voting. After that the vast majority takes very little interest. Why is it so?”

“The ruling class decided to make it illegal not to vote. This legitimised their authority. The ruling class took us into wars, sold our assets we worked and paid for, manipulated information to maintain power, lied about intentions, destroyed the working environment, handed bankers enormous control over money production, distribution and supply, and, as if to say a final “get stuffed”, taxed us for their own benefit and created systems that allowed them to steal by avoiding their own tax liabilities. Would anyone willingly vote for such an appalling structure they choose to call democracy?”

 

30 comments

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  1. Kaye Lee

    Rupert Murdoch’s media empire in the US has siphoned off $4.5 billion of cash and shares from his Australian media businesses in the past two years, virtually tax free.

    According to calculations by University of NSW accounting academic, Jeffrey Knapp, over the past 10 years, Mr Murdoch’s companies here have paid income tax equivalent to a rate of 4.8 per cent on $6.8 billion in operating cash flows, or just 10 per cent of operating profits.

    Two pages of detailed questions were put to News about its accounting practices. The response from a spokesperson for the company was: “Our financial reports comply with Australian Accounting Standards and the Corporations Act 2001, have received an unqualified audit opinion and are filed with the regulator, ASIC. Beyond this we have nothing further to add.”

    http://www.brisbanetimes.com.au/business/rupert-murdochs-us-empire-siphons-45b-from-australian-business-virtually-taxfree-20150405-1meu0l.html

  2. Terry2

    On the subject of the Panama Papers and the scourge of low tax domiciles being used by corporations and high wealth individuals to avoid tax, the Europeans have taken a different approach which, coincidentally fits into the proposed Royal Commission into banks suggested by Labor.

    The Europeans and the USA have realized that they cannot infringe on the sovereignty of countries like Panama, Eire etc to force them to be more open or increase their company taxes : it just doesn’t work that way.

    But, all money is moved around the world electronically and, of course it is the banks who facilitate this trade and who are very sheepish about opening up their books as they make an awful lot of money acting as a conduit for those who want to spirit money out of one jurisdiction to another.

    The solution : bank regulation and scrutiny by tax officials of all money transfers before the money leaves one jurisdiction for another.

    This is what we should be doing and a Royal Commission – interesting how that term has been tarnished by misuse and abuse by the Abbott regime. Let’s just say an open enquiry into banks and financial practices is well overdue.

  3. Florence nee Fedup

    Has not PM proposed new tax, or at least rebirth old one today. Is proposing “Betterment” tax to fund among other things, fast rail along east coast?

  4. Kaye Lee

    This is really doing my head in. So Malcolm is now announcing high speed rail like it is his idea when Anthony Albanese has been arguing for it for years.

    “Determined to get the dream up and running, Mr Albanese reintroduced a private members Bill in parliament last month to establish a High-Speed Rail Planning Authority that would start developing plans for the route and acquire the land needed.

    Writing in the Herald Sun in October, Mr Albanese said it was “time” for Australia to advance high speed-rail describing it as a “game-changer”.

    He argued the comprehensive feasibility study completed in 2013 by Labor when it was still in government “recommended it proceed”.

    “Based on that advice and further work by the High-Speed Rail Advisory Group, Labor allocated $50 million to establish a formal planning authority to progress the project and begin to acquire the corridor to allow it before it is built out by urban sprawl,” he wrote. “However, in 2013, incoming prime minister Tony Abbott cut the funding. He also sacked the advisory group, which included former deputy PM Tim Fischer, Business Council of Australia chief executive Jennifer Westacott and Australasian Railway Association chief executive Bryan Nye.”

    http://www.news.com.au/technology/innovation/design/anthony-albanese-will-meet-with-japanese-makers-of-superfast-train-capable-of-travelling-600kmhr/news-story/2cf82baf6e1d1353659f8714425d31e0

    Yet again we have them reannouncing things they previously cut funding to.

  5. Michael Taylor

    I like the idea of high speed rail. I like the idea of high speed internet too. Malcolm’s not interested in that though.

  6. Florence nee Fedup

    Especially high speed broadband which is doable.

  7. diannaart

    Michael. Kaye Lee and Florence echo my thoughts…

    High speed rail – yes, we do need that. Yet, I believe that the first priority needs to be high speed internet – the one that Labor proposed all those years ago (pre 2013), the one which will serve Australia well into the future, the one that gives our small nation a superhighway to the rest of the world.

    You’d think that big business would be pushing for such infrastructure, wouldn’t you? Instead of the limp copper from node to premises offering from someone who really should know better, Malcolm Turnbull.

  8. Carol Taylor

    High speed rail..perhaps something like this one in 2013.

    Prime Minister Kevin Rudd has announced funding to take the next steps towards building a multi-billion-dollar high-speed rail network on Australia’s east coast.

  9. Carol Taylor

    Also, I was wondering where Turnbull might be getting the money for this project? After all, rich people don’t ride on trains (expect if you’re Malcolm so you can tweet it).

  10. Florence nee Fedup

    Same way Howard tried to fund fast broadband. Private industry will provide. Did add rider that maybe we can have new betterment tax.

    Fantasy land stuff.

  11. Florence nee Fedup

    Albanesi ABC 24. Suggest his bill be adopted.

  12. Florence nee Fedup

    Another PM brain fart is value capture and value uplift that is already built into new infrastructure deals by all levels government.

    Albanesi spot on.

  13. Kaye Lee

    diannaart,

    Telstra wanted to, rather than maintaining the aging copper network, replace it with fibre as it wore out way back in 2005 when we still owned half(?) of it. John Howard wouldn’t let them – something to do with monopolies and competition (choke). What a joke….

    “Telstra has struck a new $1.6 billion deal with the National Broadband Network to help expand and upgrade the telco’s hybrid fibre-coaxial network, but the competition watchdog has again raised concerns about the company’s involvement in the NBN rollout.

    “While recognising that using Telstra’s technical expertise will contribute to a quicker rollout of the NBN, the ACCC remains concerned that competition issues arise from agreements that involve Telstra in the construction and maintenance of the NBN, including the HFC delivery agreement,” the regulator said this morning.

    Telstra, the nation’s largest telco, was awarded two contracts late last year to work as a service and assurance provider to the NBN, and also worked on the fibre-to-the-node trial.

    ACCC chairman Rod Sims, who has found himself in a war of words with Telstra over the regulation of pricing for competitors to access the telco’s dated copper network, said the close relationship between the company and the NBN may give Telstra an unfair advantage.

    “We have raised several concerns with Telstra and NBN Co, including that Telstra may receive a competitive advantage if it has access to better information than other service providers or if it is able to use infrastructure built for the NBN network before that infrastructure becomes available to other retail service providers,” Mr Sims said.

    “It is important that Telstra doesn’t get a head start selling retail services over the NBN just because its technical expertise is being used in the construction and maintenance of the NBN,” he said.”

    http://www.theaustralian.com.au/business/technology/telstra-in-new-nbn-contract-win/news-story/51a54d3d65c86d97b65f2a0d9066d97c

  14. Wally

    High speed rail would be good but high speed Internet is essential, we can catch a plane or a helicopter if transit fast speed is essential, there is no alternative available to high speed Internet. As time goes on the existing system is getting bogged down, at times wireless Internet is slower than 56k dial up.

  15. kerri

    Malcolm’s repeated mantra of “fair” fits like a glove with the famous quote attributed to Hitler and used ad infinitum by Turnbull’s predeccessor
    “If you tell a big enough lie and tell it frequently enough it will be believed.”
    As for Morrison? Regardless of what he needs to do to address our fiscal issues he will punish the poor.
    He has no other techniques but to be a bully to those in a position of less power tham himself!
    In his mind he is not just a man of god! He is god!

  16. Phil

    High speed rail will not eventuate in Australia. Construction cost way too high; much of the east coast topography is unsuited to rail of the high speed type. Australian population is too low to provide any reasonable return on public and or private investment. Australian cities and suburbs have evolved around the private car, the profit centres of asphalt and concrete manufacture, and the transport of heavy goods by road freight. Too much political and corporate power vested in road transport systems to allow for anything other than a talk fest on high speed rail.

    It has however got all the right feel good factors lined up for a pre-election sweet taste – a diversionary tactic – then after the election it will be back to the dreaming as we motor off into our climate changing highway future in the wholly privatised Australia the IPA is implementing through its Liberal Party puppets.

  17. Matters Not

    You’re right Phil. It ain’t going to happen and for the reasons you outline above. But why ran on the tea party. ??

  18. diannaart

    Sounds to me like a bigger bully (AKA corporation) won out over a smaller corporation.

    Hardly competitive, but definitely stultifying.

  19. olddavey

    Michael Taylor, 8:49 am:
    “I like the idea of high speed rail.”

    Me too, especially if we could send Malfeasance and his crew of miscreants on a long trip with a one way ticket.

  20. JeffJL

    Have people not watched the Utopia episode on the High Speed Rail?

    Message for Lee Mullin. Not every country in the world has compulsory voting. As the same happens in the US you should perhaps go back and check your deductions.

    This government will have no issues with producing an unfair budget. They have gone back on their word so many times this time will not matter and they will just redefine fair to refer to the 1%.

    Another good article John.

  21. Gangey1959

    JeffJL
    I agree.
    On the other hand though. They have done so many back-flips, ewe-turns and about faces that maybe they might even manage to short change themselves withe something that might benefit the 99% by mistake.

  22. John Lord

    At my age anything to do with high speed is testing.

  23. Andreas

    High speed rail not feasible?
    Check this out: 10 early morning flights SYD-MEL within the hour = say 1500 travellers = 10 x 12 tons of fuel. Brisbane, Gold Coast similar, Make sense?

  24. Steve Laing - makeourvoiceheard.com

    What I want to know is how we are supposed to be having grown-up conversations about tax, when nobody has told us about all of the ideas that were supposedly on the table? I mean, the first I heard about the states raising their own income tax was two days before it was taken off the table.

    Personally, I think Howard sold the table some time ago…

  25. Terry2

    Steve

    Jamie Briggs was dancing on that table when it was broken : Tony Abbott said he would replace it but that was just a lie.

    You’re right, there is now no table

  26. paul walter

    Everything on the table except legislation to deal with offshoring dodged tax. I must stop drawing sharp in takes of breath at the statements of Tories, no good for my health. I’m a half-reasonable liar, but the likes of Cameron overseas and most of the Coalition here has the defacto weekend hacker in awe at the sheer art of it.

  27. lawrencewinder

    It’s fair to say that we pay the fare!

  28. lawrencewinder

    …..and I remember Eleventy opining as he lost the purse, that we couldn’t afford H.S.Rail…. after a rep from French H.S.Rail said Oz was perfectly placed because of our wealth , relatively small population and distances to have it.

    Why do good ideas like kittens get drowned by the Liarbril lack of imagination?

  29. Florence nee Fedup

    Wonder why our PM isn’t under same scathing attack that the UK PM is. He is being attacked, for actions of his father. Not so our PM. He and his spouse set up their Cayman Island accounts. Are current.

    I can only see one doing this for several reasons. To avoid tax. To hide illegal money or transactions. To hide money from spouse.

    Can’t think of any legal or moral reasons.

    Politicians have solved any conflict of interest by setting up blind trusts within this country.

    PM Turnbull hasn’t given any acceptable explanation for his actions. Done through US outlets I believe.

    Just doesn’t look good.

  30. Florence nee Fedup

    Terry, it has been hinted again. it was Joe who demolished that table.

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