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Tag Archives: corporate welfare

Fair suck of the sav, Tony

fair suck of the sav

Photo: Sydney Morning Herald

When you get all of your advice from the business sector of the community, it is hardly surprising that profit becomes your foremost goal and privatisation and deregulation the means to achieve it.  But who amongst these advisers considers the greater good?  Who will offer protection from corporate greed and safety to our most vulnerable?  Who is courageous enough to look at the long term consequences of decisions?  Who will decide what is fair?

Australia had the highest per capita CO2 emissions in 2012 at 18.8 tonnes. In the US, emissions per capita were 16.4 tonnes, and just behind came oil-rich Saudi Arabia with per capita emissions of 16.2 tonnes.  The EU and China – both major emitters in absolute terms – had much smaller per capita emissions, at 7.4 and 7.1 tonnes respectively.

While Australia’s domestic greenhouse gas (GHG) emissions represent some 1.5% of the global total, its global carbon footprint – the total amount of carbon it pushes out into the global economy – is much bigger.

Australia is the world’s largest coal exporter. By adding emissions from exported coal to our domestic emissions, Australia’s carbon footprint trebles. Its coal exports alone currently contribute at least another 3.3% of global emissions.

In aggregate, therefore, Australia is at present the source of at least 4.8% of total global emissions. That’s without considering natural gas exports.

The proposed “mega coal mines” in Queensland’s Galilee Basin, producing for export, will be responsible for an estimated 705 million tonnes of CO2 per year and would turn that region alone into the world’s seventh largest contributor of emissions.

Countries such as Australia, Canada, the Russian Federation, and Saudi Arabia fail to accept any responsibility for the emissions caused by the fossil fuels they export.  They also ignore the carbon footprint of manufactured goods they import from other countries like China.  To say our contribution is miniscule is a deliberately contrived falsehood.

Is it fair for us to try to gain a competitive advantage in the market by ignoring action on climate change and leaving it to others?

The Abbott government is preparing Australians for an overhaul of the welfare system, with Social Services Minister Kevin Andrews indicating too many depend on the government for their incomes.  Mr Andrews said the review shows that more than five million Australians, or about one in five, now receive income support payments.

In his 2009 book, Battlelines, Mr Abbott wrote that one of the Howard government’s most significant achievements was “slowing the rise in the number of people claiming the disability pension”.  Mr Andrews suggests that the difference in indexation between Newstart and pensions leads to a “perverse incentive for people to get onto the DSP”.

Parenting payments and the disability support pension were two areas of welfare that “would be sensible to review again”, Mr Andrews told the ABC.

Cassandra Goldie, chief executive of the Australian Council of Social Service, whilst admitting a very small proportion of people did not do the right thing, rejected the idea that the disability support pension was an easy “rort” to sign up to. She said the previous Labor government had made it even more difficult for people to get disability pensions, and as a result more people were going on the Newstart unemployment payment of $36 a day.

“The disability support pension is now extremely hard to get on to,” she said. “It’s confined to people who are subject to rigorous testing.”

Mr Andrews flagged the idea of preventing welfare recipients from refusing to take a job on the grounds that it was more than 90 minutes travel from their home and said it was his “inclination” to consider splitting the Newstart unemployment benefit into different “tiers”, which could apply to the payment rate or the conditions attached to receiving it.

Is it fair to be targeting the poorest sector of our community whilst announcing an amnesty for wealthy tax evaders who hide their income offshore?  Is it fair to reduce welfare to our most disadvantaged whilst providing billions of dollars of corporate welfare to mining companies, banks and private health insurers?

Is it fair to maintain generous tax breaks for around 16,000 wealthier Australians while cutting tax concessions for 3.6 million workers on lower incomes and scrapping the planned increase in the superannuation guarantee?  The superannuation policy change announced by the Coalition costs the budget even more money – mostly via the huge concessions granted to higher income earners – while doing little to relieve the strain on the aged pension, since those most likely to require the pension in old age will receive an even smaller share of the superannuation concessions.

The continuation of the existing superannuation rules by Hockey would significantly exacerbate inequities in the superannuation system, since under the flat (15 per cent) tax an even greater share of tax concessions – a direct hit on the budget – will flow to those on higher incomes, whilst lower income earners will receive next to no tax benefit.

Is it fair to ask us to tighten our belts whilst paying for a Paid Parental leave Scheme which will see wealthy women paid almost five times as much ($2885 a week) as low income earners to stay at home for 6 months with their babies?

Is it fair to ask us to pay polluters bribes rather than them paying for the destruction they cause?

Is it fair to lock up asylum seekers and to leave the burden to other countries?

Fair suck of the sav, Tony.  It’s time you got, as you are wont to say, fair dinkum!

Do you want Welfare with that?

Image from theland.com.au

Image from theland.com.au

It’s Kevin Heaven again!  Our Welfare Warrior is back in the game and planting the flag, or wrapping it around his svelte figure, in acts of true olde time patriotism.

Such is the great work that Kevin Andrews (Photo:Jason South) performs.  Ever ready to announce a merger for efficiency, or a crackdown on welfare dependents (aka dole bludgers); he is at the front lines in Tony Abbott’s war.  The ex-workers at Holden and SPC will no doubt be thrilled to hear that after years of government & management incompetence they will face a much harder test to qualify for any welfare spending in their attempt to find new work.

With this great charge toward tightening belts on the shrinking waistlines of those unable to pay taxes, let us make some further suggestions for other areas to conduct a similar campaign to clamp down on our ballooning budget crisis by confronting those who are merely unwilling.

Global Googly

Google Australia has paid no tax on roughly $940 million in advertising revenue. Instead of sacking hundreds of ATO workers and outsourcing tax compliance for big corporations to private accountants, why not task these apparently surplus staff to crack down on global tax avoidance.

Currently individuals and corporation have Trillions of dollars ferreted away in offshore havens and secretive jurisdictions.  Money earned in one country is claimed as profits in another; so that Australian companies signing up for Google advertising are actually giving their money to an Irish arm of the search giant, thus avoiding tax on revenue.

According to the Uniting Church they are not alone.  Several listed Australian companies including News Corporation, Qantas and the ‘Big Four’ banks have subsidiaries in secrecy jurisdictions where money earned can be quietly kept from the prying eyes of the tax man.

Some may laud Kerry Packer’s quote about minimizing tax, the problem with that approach is that health, education, roads, defence, and politicians cost money.  If corporations pay less tax, the rest of us have to pay more.

Sick System

The importance of manufacturing is bandied about a great deal, and if the Australian public were interested in the long-term macro-economic consequences of purchasing imported cars and groceries then perhaps Ford, Holden & SPC would still be viable businesses.  However the $6 billion in assistance meted out to the auto industry over four years pales in comparison to the $5 billion that Private Health insurers receive every year.

Unlike cars and tinned fruit, Australians do not have a choice about health insurance.  Not if they want to avoid paying the Lifetime Health Cover fee.  As a result 9.7 million adult Australians now pay for private health insurance, roughly 57.1% of the population.  The lowest premiums start at about $45 per month, and in 2014 some premiums are slated to increase up to $300 per year.  Almost all of these attract the 30% rebate from the Commonwealth tax coffers, resulting in billions of dollars in direct subsidies.

When one also compares the inefficient 14% of income that private insurers pay on administration to the 5% costs incurred by the public insurer MediBank, one could be forgiven for wondering if all those billions could be better spent directly into the health system rather than being filtered through the pockets of corporate insurers.

Ground Breaking

Then there are everyone’s favourite martyrs, the miners.  Direct contributions by the Commonwealth to mining companies in 2012 tallied up to about $492 million.  However, thanks to generous fuel tax concessions and tax write-offs real support payments reached $4.5 Billion.

Former Howard adviser, now Minerals Council spokesman Ben Mitchell argued;

“The fuel tax was imposed to build public roads. Mining builds its own roads and that’s why we get a credit on that.”

He also insists that the $550 million in deductions claimed for exploration and prospecting are not just a cost of business, but a business input that the tax-payer should refund to them.

Keep in mind that the billion dollar hand-outs from the Commonwealth do not include what is chipped in by the states.  Queensland tax payers are funding the mining industry to the tune of $1.4 billion per year.

Would these companies be less profitable without this tax-payer assistance?  Yes, though to echo the Prime Minister, perhaps they should “Get their house in order” so that public money can be spent on building infrastructure instead of funding corporate salaries.

For example, taking only the annual $9-10 billion per year doled out to private insurers and miners (ignoring the tax dollars not collected from multi-nationals) it would only take four years to pay the additional $30 billion needed to complete the full FTTP National Broadband Network.

Like rail, ports and roads before it, FTTP infrastructure would create a new highway for business to grow and replace the failing auto manufacturers, encourage growth in dying regional areas, reduce the cost of public service delivery, and build new markets and a stronger economy that Australia can transition to as traditional manufacturing and mining continue to fade as meaningful contributors to the economy and employment.

Mr Abbott has also quoted and paraphrased American right-wing shock-jock Rush Limbaugh’s quote “No country ever taxed itself to prosperity.” To which I would reply with the inestimable wisdom of another American, Oliver Wendell Holmes, Jr.

“I like to pay taxes. With them, I buy civilization.”

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