Beer, cigarettes and cruises – the government’s attack strategy

May 15, 2014

It didn’t take long for the implications of the Coalition government’s first Budget to sink in. Within moments of Treasurer Joe Hockey resuming his seat, representatives of every sector from community welfare to big business filed out to front the media. What they had to say came as no surprise to anyone – business liked the Budget. Almost no one else did.

Arguably, it’s the flagged changes to Medicare that caused the most outrage – the $7 ‘co-payment’ for GP, pathology and some Emergency Department visits, and the $5 increase to medicines. Deservedly so, too. The government would have us believe it’s about spreading the ‘heavy lifting’ in order to resolve the ‘Budget emergency’ and move us quickly back to surplus. The logic is inconsistent, though. If the GP charge is all about helping out the fiscal bottom line, why earmark $5 out of every $7 to go into a medical research fund? For that matter, why not just continue to fund the CSIRO?

The numbers are one thing. Consider this, though – the government is effectively asking every single Australian to make a decision about their own health, no matter how unqualified they are. Does your kid have abdominal pains that cause him to scream? Flip a coin – heads it’s wind, tails it’s appendicitis. How about this – it’s flu season. Pay for the FluVax now, or take the risk that you won’t need to see the doctor later for an antibiotic prescription?

Ludicrous? Yes. Dangerous? Absolutely.

Oh, but no one would be so silly, would they? Mr Hockey certainly doesn’t think so. He’s got it all worked out. You see, it’s about whether we’re selfish or sensible. Why, that $7 isn’t so much to ask. It’s the equivalent of giving up a couple of beers or a third of a pack of cigarettes. Really, who wouldn’t make that sacrifice for their own health, or that of their family?

See what he’s doing there? It’s a rather nasty piece of character assassination. In so many words, Hockey laid down a series of assumptions – that people on low incomes are not concerned for their health, that they’d rather spend their money on beer and cigarettes than on their families, and that they need to take a good hard look at themselves. He didn’t quite come out and call them ‘bogans’, but the inference was practically screaming to be made. And we all know that bogans are lazy, selfish dole bludgers, right?

On Tuesday night, Hockey gushed about how wonderful it would be for people to know that their contribution to the Medical Research Future Fund might one day save their children’s lives. Today, he’s playing hardball, running back to the tried-and-true formula of ‘blame the victim’. He wants to be able to argue that if people suffer as a result of Medicare changes, it’ll be their own fault.

Then there’s what on the agenda for the aged pension – including the family home in the assets test, indexation against inflation, and a rise in the qualifying age to 70. Seniors groups are up in arms. Every one of these changes is potentially destructive. The family home has historically been exempt from the assets test, and for good reason. It’s often not until near retirement that a housing loan is paid off, and in the current housing market, the value of any given house is likely to be considerably inflated from its original asking price. A house bought for under $100,000 thirty years ago could now – conservatively speaking – be worth more than $500,000. If that value is included in a person’s assets, it would render them ineligible for the pension. Their only option would be to sell that home, downsize, and invest the remainder. Even for those of us who are younger, that’s a hugely stressful undertaking, with no guarantee of a good outcome.

Raising the retirement age also places a burden on older people. The idea is predicated on the fact that we live longer. What it doesn’t take into account, though, is that we are not living better. Medical science has become very, very good at saving lives, but it’s still playing catch-up on how to improve the quality of life for people over 60. It shows in the strain on our aged care system, where there is a dearth of available medium-care facilities – and what there is often exists in an uncomfortable middle ground between low-care ‘retirement villages’ and high-care beds.

Again, though, the government’s got an answer to objections. According to Deputy PM Warren Truss, senior just want to have their cake and eat it, too. The argument goes like this: people retire, they cash in their superannuation, go on cruises and spending sprees, and when the money’s gone, cry poor and hold out their hands for welfare. They’re just sponges. They should ‘learn to live within their means’.

Well, of course. Heaven forbid that people who have worked all their lives and put as much money into their superannuation as they can afford be allowed to actually enjoy their retirement. And let’s not mention how they often use substantial amounts of superannuation to pay off debt.

What Mr. Truss deliberately didn’t say is that money put into superannuation is taxed going in and coming out, not to mention income tax over the years. People have already contributed three times over to their own retirements. There’s also the fact that many simply don’t have enough superannuation to see them through, whether as a result of being in low-paying jobs, or simply because Australia didn’t even have a compulsory superannuation scheme before 1992.

It’s niggling little details like this that the government wants kept out of public discussion. Every pensioner and every low-income earner with children who get their faces on The Project, A Current Affair or any of the morning shows, everyone who wants to know why they are being targeted for such draconian measures, is another slip in the polls. (Despite what any government MP says, they do watch those figures.)

This tactic – blaming those who will be worst affected – is nothing short of bluster and bullying. It’s Hockey and Truss working as a tag team to kick people when they’re down. And it’s a huge mistake. Had the government stuck to its original strategy of attempting to accentuate the potential for positive outcomes, it would still have been an unpopular Budget, but that’s all – and unpopular things go away in politics.

That opportunity’s been lost, however. The Budget is irrevocably cast as not merely strict, but outright vindictive. The government has a huge problem on its hands, now. Opposition parties have flagged their intention to block key legislation (notably, Medicare changes), and the Coalition may well find itself facing Hobson’s choice – to ride it out, and risk paralysing the government, or pull the trigger on a Double Dissolution, and risk losing government altogether.


Budget 2014 – heaviest lifting from the weakest Australians

May 13, 2014

Treasurer Joe Hockey has just handed down his first Budget, and it’s a shocker. Here are the highlights – or rather, the low-lights.


Commission of Audit hits those who are most vulnerable

May 1, 2014

The government’s Commission of Audit report was finally released today. It’s over 500 pages long, but already it’s proving to be targeted at those who can least afford it.

These are just some of the recommendations:

PENSIONS

Aged pension eligibility to be raised to 70 years old.

Pension eligibility criteria to be tightened.

The family home to be counted as an asset in means testing.

Pension payments to be gradually reduced to 28% of average weekly earnings.

Carer’s Allowance to be means tested.

HEALTH

NDIS rollout to be ‘slowed’.

GP visits to cost $15 in ‘co-payment’.

Those who turn up at an Emergency Department whose situations are deemed ‘less urgent’ to be forced to make a co-payment.

Everyone to pay more for medicines, including those currently listed under the Pharmaceutical Benefits Scheme. This includes medicines that are currently free.

In a rare recommendation not aimed at the poorest and most in need in Australian society, high income earners would be required to take out private health insurance in order to access Medicare. The Commission also recommended a 2% increase in the Medicare Levy surcharge to encourage the shift to private health insurance.

NEWSTART

Payments to young job seekers to be cut after 12 months.

Job-seekers between 22 and 30 be forced to relocate to take a job after 12 months, or lose benefits.

EDUCATION

Gonski reformed to be scrapped.

States to have full control of schools.

Higher education to cost more.

Students to start paying back their FEE-HELP debt earlier.

FAMILIES

The Commission recommended the Paid Parental Leave Scheme salary cap be scaled back to $57,000 per year.

Family Tax Benefit B to be abolished.

A new FTB A ‘supplement’ to be available to sole parents with children under 8 years of age.

INFRASTRUCTURE, INDUSTRY AND PUBLIC SERVICES

More road tolls.

Industry assistance, including to the car industry, to be slashed.

Seven Commonwealth bodies to be scrapped, including the Climate Change Authority and Clean Energy Finance Corporation.

Over 60 other departments to be merged; for example, Border Protection with Customs.

The Snowy-Hydro scheme, the Australian Submarine Corporation, Defence Housing, Australian Rail Track Corporation, Australia Post, Medibank, the Royal Mint and the National Broadband Network to be sold off over time.

The Commission estimates this will mean that 15,000 fewer public servants will be needed, especially in Canberra.

New targets for funding the ABC and SBS, while the Australian Broadcasting Network would be abolished.

The minimum wage case to be abolished, with a new benchmark of 44% of average weekly earnings.

It takes no special knowledge whatsoever to see that this report is a nightmare. It targets the weakest, poorest, least able to adapt to extreme changes in their fiscal circumstances. Now, Treasurer Joe Hockey has been at pains to stress that this is a report, not the Budget, but he’s not ruling anything out, either. Some of these recommendations have already been signalled as ‘under consideration’.

Take an ‘average’ family – one parent works, making about the average weekly age. The other parent stays at home with the kids, who are 14 and 10 respectively. If the Commission’s recommendations are adopted, they’ve just lost Family Tax Benefit B. They’re probably paying higher fees to send their kids to government schools than they were even one year ago. If the kids get sick, they not only have to find the money to see the doctor, but also the money to pay for whatever gets prescribed.

How about someone approaching 65, and thinking about retirement? Their superannuation funds aren’t great, because they’ve never had a high earning job. They won’t be able to even try for the pension for five more years, and even then there’s no guarantee. You see, they own their home, which they’ve paid off over decades. Thanks to gentrification in the area, it’s probably worth a fair bit now – almost certainly enough to exclude them from the pension.

Or someone leaving high school, wanting to go to university? Well, they’d have to pay more for their degrees, but hey, there’s always FEE-HELP, right? Except that debt will be higher, and they’ll have to start paying it back much sooner. They could always go on the job market and try to save money, but if they have trouble getting a job, they might well find themselves forced to move anywhere the government deems fit, or else be back where they started with no means of support.

Even a single, able-bodied, employed person doesn’t get off scott-free. They’ll be mostly okay – as long as they don’t get sick, require regular (or even semi-regular) GP visits and medicines, lose their job, drive to work, sign up for the NBN … you get the picture.

Amazingly, the government would like us to believe that this is all necessary. It’s all the previous administration’s fault, of course. The message is clear and consistent: the Coalition don’t want to do this, but they must. Why? Because, in Hockey’s words, ‘What this report proves is that we have inherited a mess’.

Really, Mr Hockey? Are pensioners out in the streets desperately trying to make their terrible circumstances known, as they are in Greece? Is our inflation rate at almost 60%, as it is in Venezuela? Is our debt as a percentage of GDP at 230%, as it is in Japan?

The short answer is NO. They’re not.

Our inflation rate is 2.9%.

Our debt as a percentage of GDP is 28$.

Yes, we have a deficit. Yes, if a completely unforeseen disaster happened right now, we would need to borrow more money to combat that. But that deficit came about as a result of spending designed to cushion us from the impact of the Global Financial Crisis. It was strategy – and it worked.

The government would have us believe this was ‘wasteful’. They prattle about pink batts and school halls, and just about turn themselves inside out trying to obscure the real effect of the Rudd and Gillard governments’ spending initiatives.

And yet the Coalition decided to increase the deficit by $8 billion ‘just in case’.

And yet the Coalition decided to spend $24 billion on buying Joint Strike Fighters in a highly questionable business deal.

The same people who even now wring their hands and all but confirm that their sights are squarely trained on the most vulnerable of us.

Hockey says the Commission’s recommendations are ‘courageous’.

No, Mr Hockey. What would be courageous would be your government refusing to kick people when they’re already down.

But what are the chances of that?

Guess it’s over to you, Labor, Greens, PUP. Anybody? Anybody?


Hockey fumbles the ball – again – on Coalition economic policy

May 20, 2013

Sometimes, I rather feel sorry for Shadow Treasurer Joe Hockey – and then I remember that this is the man who might well end up being responsible for the nation’s finances, come September.

After Abbott’s Budget reply speech last week – a speech for which he received a good deal of criticism, and (for once) a heck of a grilling from the media – someone was going to have to attempt some damage control. And that someone pretty much had to be Hockey. After all, if you don’t send out your nominee for controller of public revenue from time to time, it’s going to be hard to sell your plan. As a bonus, Hockey doesn’t look or sound like the stereotypical Liberal. No private school vocabulary, no plummy accent. There’s a bit of the bogan in ol’ Joe, and the party uses that to its advantage whenever it’s trying to ‘connect’ with the people.

Accordingly, Hockey fronted up for an interview on ABC1’s Insiders program yesterday. Generally, the Coalition get a fairly easy ride in most interviews (the notable exception being – sometimes – ABC 730). Hockey, arriving early on Sunday morning, apparently expected the same comfortable treatment.

Instead, he was metaphorically nailed to the wall by Barrie Cassidy.

Asked to justify why the Coalition insisted on using the phrase ‘budget emergency’, Hockey at first flatly denied ever doing so (even though Opposition Leader Tony Abbott is still using it as of this morning), then fell back on familiar talking points. The budget isn’t in surplus, it will never be in surplus under Labor, we’re vulnerable because we’ve borrowed money from overseas, etc. He claimed that the major reason Australia holds a AAA credit rating from all agencies was due to the Howard government – oh, and that it was ‘cute’ that we’d achieved the rating from Fitch. It doesn’t mean much, anyway, he argued, because everywhere else is so bad. Naturally we’d look good in comparison.

In one stroke Hockey dismissed the across-the-board AAA credit rating, and the agencies. He would have us believe that it’s ultimately meaningless, that it has nothing to do with our actual economic status, and the fact that countries in Europe are undergoing incredible economic stress is the only reason we have this rating. (And, in the case of Fitch, that it’s just ‘cute’.) Hang on a moment, though. Didn’t the Opposition pooh-pooh the idea that our high dollar (among other economic factors) was directly related to European circumstances? Oops, never mind. Little details like consistency aren’t important, right?

It’s all about stability, said Hockey. That’s what the Coalition was going to provide. That statement surely had Cassidy mentally rubbing his hands with glee as he invited Hockey to give some examples, and Hockey was happy to oblige. Delay the superannuation contribution increase (from 9% to 12%) for two years. Scrap Schoolkids’ Bonus. Scrap Lower Income Superannuation Contribution Scheme. Scrap 12,000 public service jobs via ‘natural attrition’ (which is a fancy way of saying, ‘we’ll merge various departments and restructure people out of existence without actually having to call it redundancy’).

I leave it as an exercise for the reader to determine exactly how these cuts provide any stability whatsoever.

The delay in implementing the 12% superannuation contribution was where Hockey really got lost. Cassidy was relentless, pushing for figures, and Hockey either couldn’t or wouldn’t provide them. ‘I don’t have the actuarial tables in front of me,’ he repeated. ‘It hasn’t kicked in …’ He ended up utterly tangled in his own argument, unwilling to admit that there would be any effect on people’s retirement savings. In fact, he said that the delay was effectively a good measure, since people would have ‘more money in their pockets rather than in superannuation for just a short period of time’.

This is flatly wrong, and a very disturbing error for the putative Treasurer of Australia to make. Compulsory superannuation contributions do not come out of your take-home pay. They are paid by the employer on top of your salary or wage. Delaying the increase to 12% will have no effect whatsoever on the ‘money in the pocket’. Hockey should know this. It’s simple. Even giving him the benefit of the doubt – that perhaps it was a simple slip of the tongue – it speaks volumes about his ability to think on his feet about financial matters.

The rest of Hockey’s interview only added to the impression that here was a man who just didn’t know why he was there, or what he should be saying. He fell back on talking points at every opportunity. Whenever Cassidy pressed him, he would interpret it as a ‘sanctimonious’ lecture from the government, and throw in an assertion that the Coalition was ‘honest’. Even then, he seemed unable to stop himself.

On the NDIS, he said that there was no possibility of delay – but in the next breath, hinted that it might not be implemented because he didn’t trust the government’s figures. That undermined Abbott’s Budget Reply, in which he not only supported the NDIS, but actually claimed it was as much the Coalition’s ‘achievement’ as the government’s.

On the Gonski reforms, he tried to say that the budget actually cut education spending, while being funded from the mining tax (it’s actually funded from general revenue). At the same time, he admitted, ‘I don’t know what Gonski looks like, what the whole education plan looks like’.

On the Coalition’s proposed tax review, he ruled out any change to the GST – then suggested they might, possibly, perhaps look at it. In a year or two. By the next election, certainly. Assuming ‘key stakeholders’ (read: big business) went along with it.

Overall, Hockey gave the impression that he really didn’t know what he was doing, or why he was even in front of the cameras. It might be poor preparation, but this isn’t the first time Hockey has given such a dreadful performance. He’s been caught out on the Reserve Bank cash rate, sources of funding for various programs, the difference between zero growth and low growth, unable to explain the Coalition’s own figures, and – famously – redefining the word ‘tax’ in order to criticise the government. These might explain why Hockey so rarely fronts the media without Abbott right there to step in, since Shadow Finance Spokesperson Andrew Robb is nearly as inarticulate as Hockey himself.

It’s really not a good look in an alternative Treasurer. But there’s this to consider. Polls have (inexplicably) shown that, after the Budget was handed down last Tuesday, Hockey is preferred Treasurer. As the election nears, Hockey will have to front the media more often. If he acts as he has until now – unable to provide figures, contradicting his own party’s stated aims and policies, and making glaring errors on the simplest of economic questions – the Coalition’s claim to be better at managing the economy will be seriously tested.

It needs to be. The Coalition rests on the laurels of Peter Costello’s work as Treasurer in the Howard government (glossing over the fact that it was a much higher taxing government than Labor under either Rudd or Gillard), tends to be long on rhetoric and short on policy detail, and has a history of not releasing its costings until so close to an election that Treasury and the Australian people cannot sufficiently scrutinise them. That’s if they give their costings to Treasury at all – remember back in 2010, when they got out of submitting their costings to Treasury byaccusing them of colluding with the government to ‘steal an election’? In fact, the Coalition’s had a ‘pass’ on the kind of scrutiny that is absolutely necessary, while feeding talking points on ‘Labor mismanagement’ to the media that, too often, are merely repeated.

Hopefully, Cassidy’s interview with Hockey is just the first hint that the tide may be turning, and we can look forward to seeing both major parties (not to mention the Greens, and newcomers like Katter’s Australia Party and Clive Palmer’s United Australia Party) subjected to real investigation and interrogation from the media – whether mainstream or independent.


The Budget Reply, 2013 (via Storify)

May 16, 2013

Opposition Leader Tony Abbott’s Budget Reply speech, with annotations from yours truly.


No, Nanna, your TV won’t kill you

May 12, 2011

In Tuesday night’s Budget speech, Treasurer Wayne Swan announced that the government would allocate funds that will assist pensioners to get ready for the switch-off of analogue television in 2013. Under this program, digital set-top boxes will be installed, pensioners will be taught how to navigate the new system, and twelve months’ technical support will be available if needed.

Sounds like a fine idea, right? You’d be surprised.

The Master Electricians’ Association warned yesterday that the government’s program might attract ‘shonky and shoddy’ operators who would risk the lives of young, unqualified workers. These evil businessmen, lured by the promise of a quick $300, would send our hapless children into roof spaces to get electrocuted. Twirling their mustaches, they would pressure our vulnerable pensioners to sign up for products they don’t need.

Then, presumably, they would lean back in their baby seal fur covered chairs, light a cigar with a page from the Constitution, prop up their feet on their piles of money and congratulate themselves on a job well done.

The Coalition, never slow to capitalise on a potential scare campaign, immediately jumped on this idea. Their original criticism – that the program was simply wasteful – was quickly shelved, and a new message, designed to strike fear into the hearts of the elderly, hit the airwaves.

Digital television will kill your Nanna! Your house will burn down while you’re watching Masterchef! It’s pink batts all over again! The sky is falling! Won’t somebody think of the apprentices?!

Okay, stop. Breathe.

Installing a set-top box is practically idiot proof. You can walk into a shop, buy one off the shelf, take it home and hook it up. Unless you’re stupid enough to try this while standing in a bathtub full of water, the direst consequence you’re likely to suffer is a headache from the sheer frustration of trying to work out which cable goes where.

Of course, if the irritation levels spike you may find yourself shelling out for another box, but that’s another story. But the point is, installing a set-top box is about as difficult as plugging in a DVD player. You don’t need any qualifications other than the ability to plug cable A into socket B.

Seems pretty straightforward – but surely that can’t be all there is to it? The warnings are so dire, there must be some hidden danger. Ah, I know! Maybe those pensioners will need new antennas! That must be it.

So I rang Nathan at New Image Antennas, and asked him. What qualifications do you need to install an antenna? Are there any electrical dangers?

He was, frankly, bemused.

To install a new antenna, you don’t need any qualifications other than the ability to not fall off a roof. Of course, it helps if you know exactly what kind of antenna to buy, and for that Nathan recommended hiring a technician. They’d get up on your roof using safety gear and wave a signal meter around to figure out the quality of signal you can receive, get the antenna for you and install it.

Electrical danger? None.

I queried Nathan repeatedly about this and he was absolutely sure that there was no electrical risk.

But surely it can’t be that straightforward?

Wait, how about this? Pensioners live in old houses, right? They’ll probably need their antenna cabling replaced! Yes, I know, that’s a ridiculous stereotype, but go with it for a moment. So, obviously you need a master electrician to do that, and this is why the Master Electricians Association is pounding the Drums of Doom. Mystery solved.

Except you don’t.

What you need is a Certificate II in Telecommunications qualification. That’ll teach you all the ins and outs (no pun intended) of laying cable, including how not to staple your fibre-optic, CAT5, coaxial or whatever cable to electrical conduits. If you want to be really picky, you can then specialise in a Certificate II in Telecommunications Cabling.

You do not need to be a fully qualified electrician.

It’s hard to find a real safety concern here. The fact that there is a huge number of antenna installation operators out there already, regularly performing installation tasks, begs the question: why on earth would the Master Electricians Association be so adamant now that Imminent Disaster Looms on the Horizon?

The possibilities aren’t comfortable to contemplate: they range from the venal to the political.

What it comes down to, though, is that a particular organisation took it upon themselves to push a panic button for reasons that appear to be utterly without foundation. And apparently, that panic button was just too Big, Red and Shiny for the Coalition to resist.

You see, people can only get worked up to a point about ‘government waste’. It’s familiar rhetoric, and it’s been over-used to the point where it degenerates into meaningless noise and people stop paying attention.

But ‘Nannas in danger’? ‘Our most vulnerable citizens at risk’? ‘Young lives endangered by shonky operators’? Well, the headlines just write themselves. You can almost hear them delivered in that stern, condemnatory voice-over while ads for A Current Affair or Today Tonight show footage of Evil Rip-off Artists running for cover away from the Crusading Reporter on the Case, can’t you?

It’s rubbish. It’s a tabloid headline – and like most tabloids, its factual basis is close to zero.

It’s an open question as to whether Opposition Leader Tony Abbott will try to push this scare campaign in his Budget Reply speech tonight. I’d like to think he’ll have more substantial criticisms of the Budget than raising the spectre of TVs lurking in the corner of the lounge just waiting to explode.

I’m not hopeful, though.

(Caveat: I am not an electrician. The information provided is from technicians and educational institutions.)


Open Thread – the Budget

April 21, 2011

We all know it’s coming. We all know it’s going to be ‘tough’ (to quote Prime Minister Julia Gillard, Treasurer Wayne Swan, Finance Minister Penny Wong and a host of others). Yes, Budget time looms again on the horizon – and it’s becoming a de facto election battleground.

Already we’ve seen both the Government and the Opposition in a race to the bottom on welfare. Opposition Leader Tony Abbott delivers a new ‘plan’ or ‘package’ almost every day, which – in his own words – is designed to be ‘a test for government’. All up, it’s a rather ridiculous competition on which side can claim to be fiscally tougher, while challenging the other to fund various areas of Australian life.

Most of this, of course, is simple posturing. We have no details. Oh, the occasional figure gets waved around in a vague manner, but that figure is so hung about with caveats and ‘I’m not playing a rule in, rule out game’ that frankly, it might as well have been pulled out of a hat. For all we know, that’s exactly what’s going on.

None of this is new. It’s almost an article of faith that as Budget time approaches, this sort of dollar-based manoeuvring and points-scoring dominates the political discussion. But it is frustrating. Government money is public money, and our job is to wait and see what they want to do with it. Little wonder, then, that polls fluctuate wildly.

With that in mind, it’s time for The Conscience Vote to put up another Open Thread, and here are some thoughts to kick that off.

What do you want to see out of the Budget?

The government’s promised to keep to its self-imposed schedule to bring Australia back into surplus. Given the terrible disasters that struck earlier this year, and the massive cleanup bill, should they consider moving that date back rather than cutting too deeply into public funds?

Are there any areas that need more funds, not less?

Are there any areas that are already overfunded, in your opinion – and what should the government do about that?

Most of all – why do you think these things should happen?

Go wild. Make a wish list. This isn’t about crunching the numbers – it’s about what you think Australia needs, right now, regardless of what either Gillard or Abbott say.


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