quote:

Why Australians must pay to plug Government’s budget hole
Jessica Irvine
News Corp Australia

Story summary:
Treasurer Joe Hockey must act
Howard government blew half of surplus
Then Labor could not stop spending
Vital Labor policies not fully funded
Three structural holes in the economy

THIS is not a drill: Australia faces its longest run of budget red ink in history unless urgent remedial action is taken in the May budget.

Incoming governments get only one chance to fix the books and spill some electoral blood.

Joe Hockey must go hard or go home in his first budget. Peter Costello did an admirable job in his first budget. That was before the urge to splurge — which eventually gets every politician — became too powerful to resist.

Remember the days when the budget was rolling in money? For almost a decade, Costello pulled bigger than expected budget surpluses out of his hat — much to the excitement of an admiring voting public who enjoyed pension boosts and tax cuts.

Those were the days when the mining boom was just getting started. China would hand us hundreds of billions of dollars of budget windfalls, of which the Howard government blew about half, and Kevin Rudd and Julia Gillard spent the rest. It’s a sorry fact that we’ve managed to come through the biggest mining boom since gold rush days and we’ve precious little to show for it.

Rudd came to power famously promising “this reckless spending must stop” before going on a blockbuster spending spree to protect Australians against the worst of the global financial crisis.

We should be glad he did. Action was needed. But with the benefit of hindsight, too much was spent.

Labor failed to reign in the worst of the Howard government’s budget excesses. In fact, it came to power matching dollar-for-dollar the multi-billion dollar tax cuts Costello announced on the eve of election in 2007 in a desperate attempt to neuter Labor.

Despite admirable savings drives led by finance ministers Lindsay Tanner and Penny Wong, Labor couldn’t stop spending. It introduced a carbon tax that cost more in compensation than it raised. It designed a mining tax that raised next to no revenue — but had plenty of big spending promises attached.

Worthy policies like a National Disability Insurance Scheme and the Gonski education funding boost were put on the table but never fully funded.

Sure, Labor used a type of budget hypothecation to claim new savings measures — such as increasing the Medicare levy surcharge and means testing the baby bonus — would offset the cost of the new spending.

But when you’re knee deep in debt, no policy is ever really fully funded.

ARE YOU WILLING TO SUFFER TO FIX THE DEFICIT? COMMENT BELOW

Remedial action to fix the budget was needed before these big spending promises. The task is now that much bigger.

You have got to have some sympathy for nice guy Joe Hockey whose job is now to be Edward Scissorhands in chief.

Hockey must fix the three structural holes in Australia’s budget left by a receding mining boom, an ageing population and expensive new social policies.
So, remember all those tax cuts and welfare cheques? Well, we’re going to need those back.

Bracket creep will do much of the hard work Hockey. Bracket creep is the phenomenon where every year more and more taxpayers get pushed into higher tax brackets thanks to their wage rises. Wages increase every year, but income tax thresholds are fixed. Earn just dollar more and boom, you’ve gone up a tax bracket.

Treasury says the average wage earner in 2024 will be paying an average tax rate of 28 cents in the dollar up from 23 per cent now thanks to bracket creep.

Not only will you be paying more tax, get set to work for longer before you are eligible for the age pension. Prepare to pay more to visit the GP and receive fewer family tax benefits as Hockey wields the knife.

Hockey has indicated he will try to spread the pain as much as possible. We’ll all have to do some heavy lifting.

And that’s fair enough too.

It’s time we stopped living in tax fantasy land, where we don’t have to actually pay for all those things we demand of government.

It’s time we all chipped in to fund the services for the disabled they deserve and the investments in human capital — that’s education to you and me — that will equip our young people with the skills they will need to survive in our new economy.

The pain starts in May.

Sir Coq of Nandos posted:

Which robot is Clive Palmer?

Cartoon posted:

Who voted for poo poo posting? You ask around but nobody owns up.

Ettin posted:

"Wages increase every year, but income tax thresholds are fixed. Earn just dollar more and boom, you’ve gone up a tax bracket."

Endman posted:

Milky postin'.

Ettin posted:

quote:

Interestingly, there are no boat Decepticons

SynthOrange posted:

http://www.abc.net.au/news/2014-04-02/students-killed-in-brisbane-since-november/5361056

QLD is almost up to one foreign student killed a month since November. Cmon Queensland!

Quantum Mechanic posted:

I love how this terrifying budget hole could be plugged by repealing literally two Howard-era tax cuts, but no we're all gonna have to FEEL THE PAIN.

SynthOrange posted:

http://www.abc.net.au/news/2014-04-02/students-killed-in-brisbane-since-november/5361056

QLD is almost up to one foreign student killed a month since November. Cmon Queensland!

adamantium|wang posted:

Remember Angry White Man on QandA? He's a Parramatta City Councillor.




e: this OP is more than meets the eye

Quantum Mechanic posted:

I love how this terrifying budget hole could be plugged by repealing literally two Howard-era tax cuts, but no we're all gonna have to FEEL THE PAIN.

quote:

TONY Abbott has established a covert political hit squad which is funded by taxpayers, operates outside parliamentary scrutiny and has a controversial leader.

The under-the-radar Coalition Advisory Service supplies Government backbenchers with media information and ammunition to aim at the Labor Opposition. It has offices in Parliament House.

The Government says it is there to "provide training support to Government members and senators and their staff to assist them in servicing their constituents and ensuring the efficient and effective operation of electorate officers".

But its detailed activities have been kept confidential — although it is known as CAS and has a sharply political role serving the Government.

It's head is Simon Berger, the former Woolworths executive who left the company after organising the auction of a "chaff-bag jacket" at a September 2012 Young Liberal fundraising dinner addressed by Sydney broadcaster Alan Jones.

The chaff-bag referred to on-air comments by Mr Jones that then Prime Minister Julia Gillard should be put in one and dumped at sea.

Under CAS, Mr Berger has a staff of at least six but a potential allocation of 10.

They are paid from $75,000 to $175,000 a year, news.com.au has been told, and so far have been issued laptops and mobile telephones worth a total of close to $22,000.

The Labor Opposition has been trying to get more details about CAS operations at Estimates hearings where ministers and their department heads are questioned about spending.

However, CAS is not the responsibility of a minister.

It operates under Government Whip Philip Ruddock who, as he's not a minister, does not have his spending examined at Estimates grillings.

Both Labor and the Coalition have set up offices similar to CAS when in government. That's one reason why the Opposition knows it has a largely political role.

One of the most controversial was Labor's National Media Liaison Service (known as aNiMaLS) in the 1990s.

Its Labor successors include the Caucus Communications Team (CCT) and under the Coalition, the Government Members' Secretariat.

Senior Labor senator John Faulkner wants these bodies to be subjected to scrutiny by being made the responsibility of the Special Minister of State, a job he once held.
However, the Coalition wants to keep it with the Chief Whip, the current Special Minister of State Michael Ronaldson said.

"I just want to be assured by you that there is no attempt to avoid transparency and accountability by having the employing parliamentarian be the Chief Whip in the House of Representatives, hence questions at Senate estimates committees become more difficult and more obtuse," Senator Faulkner said to Senator Ronaldson at an Estimates hearing in November last year.

Senator Ronaldson replied there were "two schools of thoughts" about the issue.

"There is a view in some quarters that the Whip is the appropriate employer in that situation and that you should keep it out of a minister's office because there may well be risks associated," he said.

"It will seem to be a political office. But I am not hung up on whether it is the Special Minister of State or the Chief Whip. I am sure that, if you ask questions about it, they will be answered."

Labor has had six questions about CAS listed for the past month without answers.

However, it is known that CAS has a staffing allocation of 10 with one chief of staff at level 2, one senior adviser at band 1, five advisers, two assistant advisers and one executive assistant/office manager.

Quantum Mechanic posted:

I love how this terrifying budget hole could be plugged by repealing literally two Howard-era tax cuts, but no we're all gonna have to FEEL THE PAIN.

BrosephofArimathea posted:

Option 1: marginal rates flat, don't index brackets - you pay more tax, but it's because you are a Totally Successful Self Made Man Climbing Teh Ladder Bootstraps (if you even notice your gross tax increasing, which 90% of people don't)

Option 2: index brackets, raise marginal rates - you likely pay less tax, but THE GOVERNMENT BASTARDS RAISED MAH TAXES

Of course, there are a bunch of things that Hockey could do but won't
- Implement a proper MRT/RRT - and maybe this time, don't be massive babbys about it when they bitch about it in poorly produced tv ads
- Implement a proper ETS, and maybe this time don't be massive babbys about it and overcompensate everyone who might have hurt feelings
- Reform FTB A & B, since they are clearly broken at this point and don't even have a clear purpose
- Maybe consider having a tiny peek at that $50bn pa superannuation black hole where the overwhelming majority of benefits go to those in the top two tax brackets. Ya know.
- Include the PPOR in the pension assets test to both decrease total pension spend and stop peverse malinvestment in overcapitalising a taxfree asset
- Income test health care cards for seniors, for the same reason
- ffs, it's time to go Negative gearing ZOMG LANDLORDS STRIKE
- Drop the CGT discount since it's totally failed in it's initial purpose to discourage short term speculation and lead to huge amounts of overcapitalisation and... medium term speculation.

Jumpingmanjim posted:

All of those are politically difficult, lets just kick the mentally ill off the DSP.

Also does anyone here work for the ATO I could use some help.

Les Affaires posted:

webmeister posted:

Who's the lady on the far right of that image supposed to be?