By Denis Bright
Arrival of Chinese New Year and Spring Festival in this Year of the Metal Rat brings new possibilities in the transition from this very challenging Year of the Earth Pig on 25 January 2019.
The progressive prescription for the Metal Rat must demand outstanding critical financial planning skills.
New policy directions are needed to assist Australian policymakers with a smooth transition from the excesses of market ideology and the vacuous planning goals which have taken our nation to the brink in bush-fire disasters and ignorance about the consequences of global warming.
Corporate dreams can of course continue as shown by this advertisement to promote Independent Living Units (ILUs) for seniors at Rothwell near Bayside Brisbane for less than $400,000 (Images from villages.com.au):
The challenge for Australian Progressives is to extend this commitment to a happy private life with a love for community development and social justice. The potential progressive support base in localities like Rothwell in the Petrie federal electorate has strayed from commitment to Labor’s Light on the Hill despite the electrified rail services to Rothwell and Redcliffe which were funded by the Gillard Government.
For seniors making lifestyle choices in the Bayside suburbs of Brisbane’s Petrie Federal Electorate, Scomo’s scare strategies worked well for the LNP at the 2019 elections with additional support from preferences allocated by One Nation with those few extra votes from the UAP and Fraser Anning’s Conservative Party. After preferences, the LNP vote increased by 4.65 per cent at the Rothwell booth to 60.73 per cent.
One sign of this social empathy came in a press release from the Queensland Government on 12 December 2019 to announce the formation of a Queensland Future Fund:
The Palaszczuk Government is committed to delivering more jobs in more industries, in addition to building the infrastructure and providing the services Queenslanders need today and in the future.
To support our current economic plan and, importantly, guarantee Queensland’s future economic success, the government will establish the Queensland Future Fund with initial funding of $5 billion… The Queensland Future Fund will be managed by our internationally renowned investment arm, Queensland Investment Corporation (QIC), who have been returning significant earnings back to the Queensland taxpayer for decades through the sound investment management of our fully funded Defined Benefits scheme….The Fund, similar to the NSW Generations Fund, will be established under an Act of the Queensland Parliament, and will require that funds can only be used to pay down debt.
With the QIC in charge of the financial rafters of the proposed Queensland Future Fund, this state’s new ventures into investment fund management will have a better start than the NSW Generations Fund.
As expected after the NSW sale of electricity distribution systems, the state LNP in NSW has not run out of assets to sell to top up its existing Generations Fund with its macro-commitment to debt reduction in the old Thatcherite traditions.
The NSW Softwood forests are the next public assets on the privatisation block (Anne Davies in The Guardian 27 December 2019). This article is best perused in its entirety as it exposes the desperation of the NSW Government to continue its privatisation agenda well beyond the proposed sale of the softwood plantations.
Unlike the canny Metal Rat in Year 2020 in the Chinese Zodiac, the NSW Generations Fund is of that gnawing variety which will eventually run out of assets to chew away in the rafters. Queensland might do better with the QIC professionally managing its proposed Future Fund.
In a middle-sized Australian economy, the proverbial digital rats in our financial rafters can and should be programmed to seek new sources of capital and technology to maintain and diversify the state public sector. Opportunities exist with a newer generation of public sector initiatives through Private Public Partnerships (PPPs) using capital invested by hedge funds particularly from overseas based corporations.
The state LNP in Queensland under Premier Campbell Newman regrettably embarked on a privatisation which the NSW Government is following today. Naturally, the operators at Transurban are all smiles about Premier Newman’s initiatives (Images from Transurban International):
All this political energy could have been used more productively to overcome a capital shortage problem in urban motorways. Premier Newman was so obsessed with the merits of privatised motorways that he overlooked signing up on the $6 billion cross-river rail project which was offered to Queensland by Prime Minister Rudd in the last days of the Labor Government. The funding provided by the incoming federal LNP Government after 2013 was zero.
Overseas corporate investors would welcome opportunities to invest in PPPs without the need for fixed rate investment returns as invited in the traditional government loans and bonds of old which attracted capital with interest rate returns well above bank rates.
Today’s canny digital financial rats would sniff opportunities from investment bonds offered by agencies like the NSW Generations Fund without the need for extended terms of investment or guaranteed returns. The stability of the Australian dollar would be enough reward for investors from corporate customers in countries where currencies are unstable. All future withdrawals would ultimately be at Australian currency rates.
Such changes would require amendments to the governance sections of the NSW Generations Funds Act 2018:
The Queensland Government is to be commended for its rejection of Premier Campbell Newman’s discredited privatisation agendas and as a late starter in the formation of a Future Fund, Queensland can easily improve on the NSW model. Having the QIC in control of assets held by the Future Fund is indeed a good start.
In the meantime, Queensland leaders should be guarded about the value of the NSW Generations Fund model in the context of a broader assessment of investment future funds in Scandinavia, Canada and Singapore and the roaring success of the QIC whose finances and investment achievements are available for perusal by all (https://www.qic.com.au/ ).
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Citizens’ journalist Denis Bright checking out the good, the bad and the ugly in corporate society and back-pedalling against unfair wages and working conditions under the false flags of free enterprise and trickle-down wealth agendas.
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Newman and the NLP were a disaster for Queensland and that state is still recovering from the ideological destruction of an excellent public service for no good reason.
Newman’s successors have as much charisma as a dead rat and about as much a ability between them as could be described on the back of a postage stamp leaving room for the recipient’s address.
Where do they git ’em??? Oh I remember, from a schooling system that disregarded secondary education because it taught kids to think, and then these kids started asking questions, and next thing you know they wanted to change towards a better democratic world.
While I agree that Newman was a disaster (as evidenced by his political annihilation after just one term) there’s a few other statements that bear closer examination. In the post World War 2 era, when secondary education was expanding rapidly across Australia, Queensland was under a Labor government (and was for most of the 40 years to 1957). As Coaldrake points out:
A few things to note. Decentralisation made activity more expensive (relatively). Second, the (Labor) Parliament was representative of an electorate which didn’t express a felt need for advanced schooling. Thus no pressure and no vision (if you like) meant Queensland was left behind when it came to the provision of secondary education which then translated also to lower participation in University. In turn, that led to less funding (structurally) for higher education when the Commonwealth assumed responsibility for same and decided that the ratio of existing expenditure would serve as the basis for future funding.
It’s well documented by Clarke and Logan who worked in the History Unit in the Queensland Department of Education – which was abolished under an incoming Goss Labor government. (Yes sometimes that excellent public service also did things for no good reason and I can vouch for that personally.)
https://www.couriermail.com.au/extras/ww2/queensland.htm
You can read much more about the development of QLD secondary education here.
https://education.qld.gov.au/about/history/Documents/secondary-education.pdf
Dennis, having rid myself of that burr, can I also agree that when it comes to long-term financial management Queensland has a very good track record, at least in the public sector. QSuper, for example. has been kind to me and mine due (in part) to good Board management from the representatives of the Public Service and the public service Unions – in particular the QTU. One hopes that any merger doesn’t stuff that up.
Queensland Labor seems to have found its reformist agenda with its commitment to both the new Future fund and continued support for the QIC.
Most interesting article Denis, we certainly don’t want the disastrous years of the short lived Newman government again
Interesting times
Interesting insights – definitely worth considering.
Great that Queensland has a progressive investment future fund: I wish it well from the Philippines where we desperately need a similar fund
How can voters in NSW be so gullible. The LNP wants to privatize most services and take preferences from the far-right parties at every election, including Mark Latham’s One Nation Team which claims to represnet the Battlers.
rubio@coast re your question:
Great question. But perhaps a more interesting question(s) might be: Why aren’t you also as gullible?
Presumably it wasn’t an intervention from above? So what made (and continues to make) the difference? (Given that approximately 50% of NSW citizens don’t think like you do.) Care to share?
And perhaps even more importantly, how do you think others can become more critical thinkers?
The LNP is skilled at presenting a wholesome big picture of a corporate state that is controlled by political elites with reinforcement from minor right-wing minor parties that allocate preferences back to the LNP. after pretending to support the battlers in the outer suburbs and regions. That has been the political record of the LNP for much of the past seventy years, Matters Not. The current NSW Government is confident enough to persue a privatization agenda which is opposed by most voters and the old big picture maybe starting to wear thin.
This was a good read also.
Rubio, my heart bleeds for you.
It may cheer you up to know that you are not the only person baffled at current politics driven by monumental and unrelenting gaslighting and brainwashing.
Commitment to Investment Funds has come late to High Tories with Thatcherite values as in NSW. The Generations Fund like John Howard’s Future Fund accepted capital from privatized assets to kick start successful investment funds. In Britain, the Tories finally tried the Northern Powerhouse Investment Fund which was supported by the European Union and the government owned British Business Bank. What will happen after Brexit?
All these models are poor derivatives of the Scandinavian Investment Funds. The Aussie variants need to accept new investment capital from the business sector to offer safe havens with token dividends to attract huge deposits from investors in less stable countries. Even the Chinese Yuan is in this category.
Hopefully,the Queensland Treasury is in regular communication with such successful overseas investment fund iniitiatives. It is a bit incestuous for Queensland Treasury to be looking south to initiatives from the NSW LNP Treasurer, Dominic Perrottet.
Hope that cheers you up Rubio on a day of thundery showers by the Harbour that would extend up to your Central Coast surfing haunts.
There is financial sunshine in freezing countries in Scandinavia and Canada as well as tropical Singapore with its innovative government controlled Temasek Holdings and GIC Private Limited that have combined assets that approach one trillion Australian dollars. Capitalism has more successful variants than the old Thatcher straight-jackets.
Surely, Dominic Perrottet learnt of all these bright lights on the hill and their embedded Catholic values at Oakhill College and the University of Sydney where he regressed to become an active campaigner against compulsory student union fees to provide better services for students.
Denis, Thanks for an interesting article about the Qld economy and the future fund.
Denis, Thanks for an interesting article about the Qld economy and the infrastructure investment fund.
Thanks for those comments to widen discussion of the presenting issues. I welcome new comments from Matters Not and New England Cocky who were regular commentators in the past.
Politics will improve its tarnished images if commentators strive to take up the issues that Concern the Many.
Australia has drifted from early traditions of comparative radicalism during the federation era to a current situation where our leaders are afraid to make critical comments on the antics of the Trump Administration.
Regional federal seats are almost wall-to-wall in favour of the conservative wings of the LNP. This influence is being extended into disadvantaged outer-metropolitan areas which were formally Labor Heartlands. Preferences from far-right parties playing quite a decisive role in statching seats like Longman from Labor.
Promoting discussion is a danger to this creeping hegonomy of US style conservative populism. Our historical traditions favour the centre-left of politics and old traditions are being re-asserted steadily by the bad rating levels our LNP elites.