Dear Prime Minister, Australia doesn't need lower taxes

The Australian federal election tax debate is well underway.

The Financial Review revealed on 12 April 2016 that modelling indicated that a cut to company tax would not be in the national interest as it would lead to a sharp decrease in living standards by 2040.....

"It is national income, and not production, that provides an indicator of living standards. Overall we conclude that while a cut to company tax will boost domestic production, it will lead to a fall in real incomes in the range of $800 to $2000 per person in present value terms," Dr Dixon writes in The Australian Financial Review.

The Turnbull Government received an open letter on 13 April......

The Australia Institute, 13 April 2016:

Top economists and community leaders have signed an open letter calling on Prime Minister Malcolm Turnbull to not to cut taxes at this time - especially not on company profits.

The letter, published as a full-page newspaper advertisement, is signed by Former Reserve Bank Governor Bernie Fraser, ACTU National President Ged Kearney, Former WA Premier Carmen Lawrence, Uniting Church Australia President Stuart McMillan and Nobel prize winner Peter Doherty and a collection of economists are part of a list of 50 prominent Australians who are calling for prioritising services, not tax cuts.

The letter reads:

“Cutting programs which support needy Australians to give more tax benefits to companies is not fair. Collecting more tax, more equitably, will make Australia a better place to live and work.”

“Now is not the time to cut taxes. It would be fiscally irresponsible to lower the company tax rate in the current budget environment,” Executive Director of The Australia Institute, Ben Oquist said.

“Proponents of a cut to the company tax rate continue to promote claims of long-term, trickle-down benefits without identifying the immediate impact to revenue and in-turn essential services.

“In fact, a five-point cut in the company tax rate would deliver a projected $27 billion windfall over ten years for the four major banks alone. This simply makes no economic sense and would put Australia’s revenue base at risk. 

“Australia is a low taxing country, 6th lowest by OECD standards. We also have a clear revenue problem, which should be this priority for this budget,” Oquist said.

This was followed three days later by a breakdown of the taxation profiles of the Liberal-Nationals and Labor federal governments.....

THE 10 HIGHEST TAXING AUSTRALIAN GOVERNMENTS

2004-05  24.3% Liberal
2000-01  24.2%  Liberal
2005-06  24.2%  Liberal
2002-03  24.0%  Liberal
2003-04  24.0%  Liberal
2006-07  23.7%  Liberal
2007-08  23.7%  Liberal
1986-87  23.3%  Labor
1987-88  23.2%  Labor
2001-02  23.2%  Liberal

[Stephen Koukolas, 16 April 2016]

THE 10 LOWEST TAXING AUSTRALIAN GOVERNMENTS

1992-93  20.0%  Labor
1993-94  20.0%  Labor
2010-11  20.0%  Labor
2009-10  20.2%  Labor
1991-92  20.7%  Labor
2011-12  20.9%  Labor
1983-84  21.0%  Labor
1994-95  21.2%  Labor
2012-13  21.5%  Labor
2013-14  21.5%  Labor

And the source for these numbers are the MYEFO released by Treasurer Morrison and Finance Minister Cormann in December 2015: http://www.budget.gov.au/2015-16/content/myefo/html/index.htm [Stephen Koukolas, 16 April 2016]

Australian Federal Election 2016: is the country really going to the polls on 2 July?

On 18 April 2016 the Australian Senate again failed to pass the Turnbull Government’s Australian Building and Construction Commission (ABCC) bill - this time by two votes.

A fact which gave the prime minister the double-dissolution trigger he was hoping for and an apparently favoured poll date – 2 July 2016.

If this is indeed his preferred date, then the election writs need to be issued no later than 31 May, as there is a mandatory minimum 33 days between writs and polling day.

The 2016-17 budget speech is scheduled to be delivered on 3 May, the appropriation bills are then submitted to the House of Representatives later that same day or the next and read a first and second time.

With the Leader of the Opposition’s budget reply speech expected on 5 May, all appears well with Turnbull’s time table. He has twenty-six days up his sleeve before having to quit governing to enter the official election campaign period.

However…….

The debate on the second reading of Appropriation Bill (No. 1) is known as the ‘Budget debate’ and normally continues over a period of several weeks. The scope of discussion in the Budget debate is almost unlimited because the debate on the main Appropriation Bill is exempt from the standing order (rule) which requires the second reading debate on other bills to be strictly relevant to the bill. The standing order allows debate on appropriation bills to cover matters relating to ‘public affairs’. This is interpreted to mean any matters concerning government policy or administration. [Australian Parliament, Infosheet 10 - The budget and financial legislation]

In 2015 it took forty days for the House of Representatives to finish debating Appropriation Bill (No. 1) -  the bill covering money out of the Consolidated Revenue Fund for ordinary annual services of government.

Government has the numbers in the Lower House and can possibly truncate this debate – but not by much and not without alienating a substantial numbers of voters.

At this point Turnbull’s twenty-six day leeway may be dwindling down to less than 14 days. Still, getting to the 31 May writs deadline with the main appropriations bill passed looks vaguely possible.

But…….

Before they become law the three main budget appropriation bills must be passed by the Senate in the same way as any other bills. [ibid]

Two years ago the Senate took a mere two days to send the main appropriation bill back down to the House of Representatives. Last year the senators took only one day.

This year the 'reformed' Senate may just decide to debate this bill a good while longer and, it will serve the prime minister right if the cross-bench runs him down to the wire on this.

Of course Turnbull could go to an election without money from consolidated revenue being guaranteed for 1 July 2016 through to 30 June 2017.

It’s just that this would be such a slapdash look for a former investment banker who portrays himself and his government as good economic managers.

Australia Autumn 2016: The Emu in the Sky

The Emu in the Sky

CSIRO Australian Aboriginal Astronomy

Map of Australian sky in April here.

So Malcolm Turnbull wants to continue Tony Abbott's vendetta against the former Labor Government's industrial relations legislation

After Australian Prime Minister Malcolm Bligh Turnbull initially promised to abolish a road safety tribunal if re-elected, following the body's attempts to introduce a new minimum pay rate for trucking contractors, he then announced that the demolition process would begin in this week's special parliamentary sitting.

So what did he actually abolish on 18 April 2016 and why?

The Road Safety Remuneration Tribunal (RSRT) began operation on 1 July 2012.

The Tribunal makes road safety remuneration orders, road transport collective agreements, deals with certain disputes relating to road transport drivers, their employers or hirers, and participants in the supply chain and, conducts research into pay, conditions and related matters that could be affecting safety in the road transport industry.

One month after the last federal election which saw the Liberal-Nationals coalition win government, the Abbott Government announced a review of the RSRT as part of its election promise to review industrial relations law made since the abolition of Work Choices.

The Government’s pre-election Policy to Improve the Fair Work Laws (May 2013) included a commitment to review the operation of the Road Safety Remuneration Tribunal as a matter of urgency. [Review of the Road Safety Remuneration System, Rex Deighton-Smith Jaguar Consulting Pty Ltd, 16 April 2014]

This review was published on 16 April 2014 and, such was the alleged urgency of the matter that the government did not act on its recommendations.

On 11 December 2015 the Tribunal published its Contractor Driver Minimum Payments Road Safety Remuneration Order 2016 which was to take effect from 4 April 2016.

This was the second remuneration order it has made – the first being in 2014.

Subsequent to Remuneration Order 2016 the Abbott-Turnbull Government ordered a second review of the RSRT which was published in January 2016 – a year in which not so co-incidentally it faces a federal election.

On application by Australian Trucking Association (ATA) and National Road Transport Association (NatRoad) the Federal Court of Australia granted a stay on the remuneration order on 1 April 2016, which it later lifted on 7 April 2016.

This is where the matter stood on 18 April 2016 as to the continuing existence of the Road Safety Remuneration Tribunal and the validity of its remuneration orders relating to time and distanced travelled by contract drivers.

But what of the road safety issue? Many people on the NSW North Coast are concerned about their safety when travelling on routes used by heavy commercial vehicles. Anecdotes concerning near misses and reckless heavy vehicles are common when it comes to travel on the Pacific Highway between Coffs Harbour and the NSW-QLD border.

Heavy vehicles reportedly make up 3 per cent of all Australian road traffic and heavy vehicle speeding above posted limits is recognised by governments, the trucking industry and the community as a serious issue in Australia.

Although speeding is a significant risk factor for road crashes for all types of motor vehicles, it is generally considered to be a more critical factor in heavy vehicle crashes. This is because of:

longer breaking distances—heavy vehicles require between 20 to 40 percent more stopping distance;

shorter reaction times—reaction time is a smaller proportion of stopping distance;

greater instability—heavy vehicles are less stable than lighter vehicles, which makes emergency manoeuvres and loss of control on curves more likely; and

greater collision energy—due to their size and rigidity, heavy vehicles exert more collision energy and cause more damage on impact than do other vehicles (Bishop et al. 2008; Brooks 2002; NTC 2005). [Australian Institute of Criminology, October 2012, Trends & issues in crime and criminal justice no. 446]

The federal Dept. of Infrastructure and Regional Development publishes quarterly bulletins on fatal heavy vehicle crashes.

These following statistics are found in its December 2015 bulletin and accompanying tables.

During the 12 months to the end of December 2015, 210 people died from 187 fatal crashes involving heavy trucks or buses.

These included:

– 115 deaths from 102 crashes involving articulated trucks

– 79 deaths from 72 crashes involving heavy rigid trucks

– 20 deaths from 17 crashes involving buses.

Of those 58 fatal crashes which occurred in NSW:

* 31 involved articulated trucks (5 of which did not involve another vehicle) – resulting in 34 deaths of which 22 were drivers of either the heavy or light vehicle involved

* 22 involved heavy rigid trucks (1 of which did not involve another vehicle) - resulting in 24 deaths of which 16 were drivers of either the heavy or light vehicle involved

* 5 involved buses – resulting in 5 deaths of which 3 were drivers of the bus or light vehicle involved.

The correlation between truck drivers wages and safety has been drawn to the attention of the Turnbull Government.

The Conversation, 13 April 2016:

On the question of pay and road transport safety, the Pricewaterhouse Coopers report said:

directly comparing remuneration and safety does demonstrate statistically significant correlations. However, results vary substantially.

the four most recent papers range in conclusion from a) a very large effect, b) a U-shaped curve, in which a large positive effect of initial remuneration rises eventually turns negative, through to c) and d) with a very small effect

the literature is very limited in size and focuses on employee drivers

Drivers are likely to benefit the most [from tribunal orders] due to increased remuneration and fewer road accidents, followed by government and members of society who face costs following road crashes, and will therefore benefit from an improvement in safety.

You can read the full response from O'Connor’s spokeswoman here.

If you just read that Pricewaterhouse Coopers report excerpt above, you might think that the evidence is fairly mixed. In fact, the overwhelming weight of evidence supports Albanese’s claim: there is persuasive evidence of a connection between truck driver pay and safety. [my red bolding]

So there we have it.

The Turnbull Government ignored evidence and supported trucking industry calls to abolish the Road Safety Remuneration Tribunal and, with the assistance of Senate cross benchers on 18 April, set in motion the removal of a minimum wages award for contract drivers.

However, voters and other road users are being told ‘don’t you worry about that’ when it comes to the safety of themselves and their families when sharing roads with commercial heavy vehicle operators seeking to make profits under a no minimum wage, performance (time) based system.

First Dog on the Moon slyly put the case for the continuance of a minimum wage, without the ongoing political interpretive dance (left) being performed by Michaelia Cash in pursuit of the creation of Work Choices Mark II:

Click on image to enlarge

Australian Federal Election 2016: Ooopps!

Receiving an honourable mention on the slippery slope of media attention are; a missing rare coin, Liberal MP for Corangamite Sarah Henderson's election campaign corflutes, the Liberal Party of Australia, Liberal Senator for Victoria and Australian Minister for Vocational Education & Skills Scott Ryan, along with Prime Minister Malcolm Bligh Turnbull's failure to notice the homophobe and 457 visas.

Crikey.com.au, 14 April 2016:

It has the hallmarks of an episode of The West Wing: the Prime Minister was given a rare and precious artefact. The artefact went missing. And now the staffer who was supposed to have been looking after the artefact is gone.

Electrical Trades Union on Twitter, 14 April 2016:

Herald Sun, 12 April 2016:

ACCESS to a confidential database that holds federal Cabinet ministers’ personal contact details was issued to a non-government employee because he shared the name of a current political staffer.

In an embarrassing breach of the Liberal Party’s “secure” website protocols ahead of this year’s federal election, an adviser to a crossbench senator was issued with personal login details to the site that contains confidential internal government documents and policy briefing notes.

An email sent on behalf of Liberal Party federal director Tony Nutt provided Chris Evans, an adviser to independent Victorian senator John Madigan, with a password to the site while it also outlined security protocols around its strict access.

Government sources yesterday told the Herald Sun it should be viewed as potentially a “serious security breach” and labelled it “incredibly sloppy”.

Approved access to the site known as Jeparit Town, a reference to the rural Victorian birthplace of Australia’s longest-serving prime minister, Sir Robert Menzies, is reserved for “approved personnel” including Liberal MPs and senators, candidates and senior staff.

It is viewed as an important source of information that also includes “talking points” for media interviews, personal phone numbers of parliamentarians and staff, political artwork, and training materials.

The Canberra Times, 12 April 2016:

Vocational Education Minister Scott Ryan has been left red faced for giving a speech to a national training organisation that not only lifted – without attribution – quotes directly from the association's own journal, but also praised the "current" work of an entity that no longer exists.

Last Thursday Senator Ryan delivered the keynote address to Group Training Australia's national conference in Adelaide.

GTA is the body representing Australia's largest employer network of apprentices and trainees.

In his address the minister lauded the work of a Charters Towers based trainer Rural Industry and Extension, or RITE, for providing training right across northern Australia.

He spoke of RITE being both a Registered Training Organisation (RTO) and an official Group Training Organisation (GTO) "responsible for one of the largest regions in the world, extending across Queensland, the Northern Territory, Western Australia and South Australia".

By this point, eyebrows were already being raised in the audience…...

Geelong Advertiser, 11 April 2016:

A FORMER Victorian Liberal candidate who was once disowned by his party over homophobic comments has been awarded the party’s most prestigious award for young members.

Aaron Lane was given the meritorious youth award at the party’s state council in Victoria on Saturday.

The award was presented by Foreign Minister Julie Bishop and Prime Minister Malcolm Turnbull, who news.com.au understands was not aware of the 2014 controversy.

The honour comes less than two years after Mr Lane was forced to resign his candidacy in the upper house Western Victorian Region over a series of derogatory tweets.

Mr Lane published tweets including the word “faggot” and saying, “The problem is (IMO) many homos make their sexuality a defining aspect of their being.”

He also called Labor figures Simon Crean and former speaker Peter Slipper “a giant C”…..

7 News, 5 Februrary 2016:

7 News can reveal a truck driver who sparked traffic chaos, shutting down the M5 East on Friday, is here working on a 457 visa. The driver is so inexperienced that he couldn't reverse after realising his truck was too tall to enter the airport tunnel. Chris Reason reports.

UPDATE

https%3A//vine.co/033764db-60af-4224-b97f-499d87506030

18 April 2016

Global corruption of democracy in the 21st Century

The Guardian UK, 11 April 2016:

Because at root, the Panama Papers are not about tax. They’re not even about money. What the Panama Papers really depict is the corruption of our democracy.

Following on from LuxLeaks, the Panama Papers confirm that the super-rich have effectively exited the economic system the rest of us have to live in. Thirty years of runaway incomes for those at the top, and the full armoury of expensive financial sophistication, mean they no longer play by the same rules the rest of us have to follow. Tax havens are simply one reflection of that reality. Discussion of offshore centres can get bogged down in technicalities, but the best definition I’ve found comes from expert Nicholas Shaxson who sums them up as: “You take your money elsewhere, to another country, in order to escape the rules and laws of the society in which you operate.” In so doing, you rob your own society of cash for hospitals, schools, roads…

“Those who exited our societies are now also exercising their voice to set the rules by which the rest of us live”

But those who exited our societies are now also exercising their voice to set the rules by which the rest of us live. The 1% are buying political influence as never before. Think of the billionaire Koch brothers, whose fortunes will shape this year’s US presidential elections. In Britain, remember the hedge fund and private equity barons, who in 2010 contributed half of all the Conservative party’s election funds – and so effectively bought the Tories their first taste of government in 18 years.

To flesh out the corrosion of democracy that is happening, you need to go to a Berlin-born economist called Albert Hirschman, a giant in modern economic thinking. Hirschman died in 2012 at the age of 97, but it’s his concepts that really set in context what’s so disturbing about the Panama Papers.

Hirschman argued that citizens could protest against a system in one of two ways: voice or exit. Fed up with your local school? Then you can exercise your voice and take it up with the headteacher. Alternatively, you can exit and take your child to a private school.

In Britain and in America, the super-rich have broken Hirschman’s law – they are at one and the same time exercising economic exit and political voice. They can have their tax-free cake and eat it……