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Beer, cigs up

This thread is a work in progress. This evening and tomorrow, as time and energy allow, the moderators will put up excerpts and links to various leaks and predictions about Budget 2008. We will also, in due course, do likewise to Wayne Swan's budget speech, and to the commentary on it. Meanwhile, if anyone wants to start discussing budget-related matters, go for it...

UPDATE 1:00am, 13 May 2008

The first story to land, with an insinuation that the Murdochs picked up a copy from the printers, is of a revamp of some of Centrelink's more draconian practices. Goodbye work for the dole, goodbye three-strikes-out. Hello instead to greater incentives to job networks, greater assistanc to single mothers sent back to work. Goodbye to the baby bonus for those making more than $150 grand a year, despite Brendan Nelson's chiding that all babies should be treated equally. Will the expectant mothers of Point Piper, Toorak and Springfield have tear-stained pillows tonight?

Maybe they will. The cognac may not flow so freely this year, and perhaps the upgrade to the latest Beamer may have to wait if the increased tariffs on luxury cars hurt too much.

Nassim Khadem and Michelle Grattan report in The Age that

Means testing and tax rises will hit the rich, but battlers will be protected as the Government cracks down on inflation in a bid to avoid fresh interest rate rises. Election promises, most notably the $31 billion tax cuts package, will be delivered. The surplus for 2008-09 will exceed $17 billion and could be more than $20 billion. Around 650 cuts and redirections of spending will yield billions in savings.

It is to be hoped, though, that some of the budget revenues are better calculated than the benefit of the tax increase on "alcopops", the premix that has become the beer of many of the newest alcohol consumers. Forbes quotes an expectation of $500 million annually. But will the kiddies, who were enjoying one and a half drinks for the price of one, stick with the pretend stuff (have a look at a label sometime and see how much of the emblazoned spirit is in the bottle) or will they go to the true hard spirit?. If Treasurer Swan hasn't factored such a simple possible decline in income into his sums, does it mean he hasn't done enough homework elswhere?

On a more serious note, it was disturbing to see Nicola Roxon's blase attitude to the Rudd Government's leaking of Budget elements on the 7.30 Report overnight. She described the government's media management practices as "a bit like sausage making, some things you don't want to see behind the scenes"

So, what's for breakfast?

UPDATE 12:04pm, 13 May 2008

In a speech to the annual Australian Davos Connection Future Summit in Sydney on Sunday 11 May, Kevin Rudd warned that Australia is in danger of "waking up with the mother of all hangovers" because of the Howard government’s failure to deal with "a multitude of economic weaknesses" hidden by the mining boom. In a speech that outlined the strategy of this evening’s budget, Mr Rudd said:

The Government’s first budget, to be delivered on Tuesday, is one step in our program to transform the future competitiveness of the Australian economy.

For too long budgets have been an annual political give-away in which the government of the day serves up an array of handouts and quick fixes. That is no longer good enough. If Australia is to compete and succeed in a rapidly changing world we need a long-term approach to fiscal policy.

That is why I have said that this Budget won’t be another “one year wonder”. It will be a budget that sets a platform for long term growth. It will begin to prepare Australia for the future. It will build a strong foundation of economic stability that will benefit Australia for years to come.

That foundation is based on four principles. Our first priority is to build a strong economy through responsible economic management – a strong economy that also delivers for working families. Second, we are committed to honouring our commitments to help working families under financial pressure. Third, we will deliver on our commitments to prepare Australia for the great challenges of the future – acting on areas of long-term government neglect: in education, health, infrastructure, climate change and water, and the rise of India and China. Fourth, we will plan and provide for our nation’s long-term defence and security needs in a rapidly changing environment. These are the principles and priorities which have guided us in this Budget process, and they will be reflected in the outcomes on Budget night.

The Budget is a first step in the Government’s broader long term economic strategy. It is an opportunity for us to make a start on our long term vision for the nation.

UPDATE 2:00pm, 13 May 2008

Former Treasurer Costello has pushed Malcolm Turnbull out of the spotlight by giving a rare interview this morning.

[ABC extract]

He described Mr Swan as the "luckiest Treasurer in the world", saying he inherited an economy that is stronger than the major developed nations.

"We left a surplus of $15 billion, it would have been revised up closer to $20 billion," he said.

UPDATE 9:29pm, 13 May 2008 - an unashamed steal from Crikey - but then, I have been a loyal subscriber for years and years...

Bernard Keane: The first Swan budget -- how it rates The first Swan Budget does not take the promised meat-axe to Government spending but may be nearly enough to convince the Reserve Bank it is serious about restraining demand. Despite the big $21.7b surplus, this Budget spreads the pain across as many people and as few headlines as possible, but manages to slow the remorseless growth in Government spending since 2004.

But the real cuts are in the minutiae of the agency expense measures across the breadth of Government activities. The majority are relatively small programs where the pain will be muted due to the size of the sectors involved. The Advancing Australia and National Food Industry Strategy programs in AFFA. Advertising cuts. The previous Government’s PC filters program. Apprenticeship schemes. The Realising Our Potential education programs. Green vouchers for schools. A delay in the start of digital radio.

All these have kept real growth in spending to 1.1%. I despondently predicted 2.8% last week so have to acknowledge a solid effort, although it’s not in the league of Peter Costello’s first two budgets. Problematically, however, spending is forecast to rise back to 4% next year. While this partly reflects the impact of pushing a number of big expenditures in 2009-10 – spending falls back in 2.1-2.2% in the out-years – it suggests that Lindsay Tanner’s razor gang needs to keep chipping away at the Howard legacy of profligacy.

On the revenue side, a range of tax concessions and rebates will be removed in areas such as crude oil excise, FBT exemptions, depreciation and capital protected borrowings. Together with the alcopops excise increase, the luxury car tax increase, and an old-fashioned rise in the passenger movement charge, this will yield an extra $2.4b next year and more in outyears. However, that is dwarfed by the $8.8b increase in forecast revenue growth achieved in spite of the collapse of capital gains tax revenue.

The vast surplus racked up by Swan and Tanner will be directed into three new funds – a new infrastructure fund to invest in road, rail, ports and broadband, worth $20b over two years, an extension of the Higher Education Endowment Fund into a new $11bEducation Investment Fund, and a $10b Health and Hospital fund, all to be managed by the Future Fund. A COAG Reform Fund (more correctly, a State Bribes Fund) will also be set up to channel reform-related payments to the States.

...

Alan Kohler: The Budget that Tanner built

This is more Lindsay Tanner’s budget than Wayne Swan’s or Kevin Rudd’s.

There are no new spending measures, only new savings, and remarkably the Finance Minister has found $2 billion more in savings than Swan and Rudd are spending.

The first Swan/Tanner budget actually reconciles the irreconcilable: the need for fiscal restraint to fight inflation while fulfilling the Government’s election promises and not crunching the economy so hard that it risks exacerbating the coming slowdown.

And it had been done simply by carving into middle-class welfare and cutting out the fat left by John Howard’s profligacy.

When the former Treasurer Peter Costello said at a remarkable doorstop press conference this morning that Wayne Swan is the luckiest new Treasurer in history, he was absolutely right – but not for the reason he meant. It’s because there was so much fat left in Government expenditures that could be painlessly cut away.

The core of the budget – what it’s really all about - is contained at the back of budget paper No.2 - from page 361 to p.427. Here you will find 66 pages detailing 134 new savings measures, on top of the 46 cuts announced during the election campaign, totalling $1.6 billion in 2008-09.

The new savings total $5.7 billion in 2008-09, 11 dozen of them – big ones, small ones: nip cut slash.

The big picture of this budget is that the Rudd Government has announced $5.3 billion worth of new spending for 2008-09 leading up to it, and has now announced savings of $7.3 billion, increasing the surplus by $2 billion.

In addition to that there are a total of $5.4 billion in unexpected increases in tax receipts and other windfalls since the pre-election fiscal outlook (PEFO) that was issued by Treasury during the election campaign last year.

As a result the $14.3 billion surplus forecast in the PEFO has now turned into a $21.7 billion surplus ($14.3 billion plus $2 billion plus $5.4 billion).

So whereas the Howard Government spent every cent of the commodities boom windfall, the new Government has so far put it all into the bank, and added another $2 billion to it by cancelling some of its predecessor’s spending.

...

Robert Gottliebsen: Labor's attack on tall poppies

Treasurer Wayne Swan and Finance Minister Lindsay Tanner have unveiled a secret weapon to maul the finances of higher income families – and all in the name of tax "fairness". And their 2008 attack is only the first round because I fear there is more to come.

A large number of middle income families negatively gear property or shares and/or salary sacrifice into superannuation or into reportable fringe benefits with two objectives in mind. The first is to save tax and second to enable their families to receive education, and other allowances. It is also sometimes used to lower dependency payments. Losses on investments can have a similar effect

The tax deductibility of negative gearing and salary sacrifice has not been touched in the budget but from July 1 2009, in assessing means-tested income, the amounts salary sacrificed, the negative gearing benefits, the fringe benefits and the investment losses will all be added onto income. And so the new income test for the family tax benefits is to be calculated on the increased income. The same applies to education and many other allowances.

The caps on family benefits are stated as being subject to a $150,000 "income" limit, but for people with less than three children the cut off point is less than that and will be less again once the new definitions are used.

From July 1 2009, the medical benefit surcharge thresholds of $100,000 for singles and $150,000 for couples will be defined using the new calculations of income – effectively for many people the thresholds will be lowered.

There are other attacks on middle income Australia including subjecting "meal card" arrangements to FBT (where the employer pays for meals consumed by the employee on the premises as part of a salary package) and removing FBT exemption for work related items mainly used for private purposes such as laptops plus other FBT tightening moves. All of these items will cause major reviews of many current salary packages.

The second round of middle income blows will start with school fees. Middle income families in Victoria are going to be hit with much higher private school fees as a result as the big teacher pay rises in the state system spread to private schools, especially as there does not seem to be any provision in the budget for increased help to private schools to help pay for the rises. Those teacher pay rises are certain to quickly spread to other states and will present a major impost on those sending their children to private schools. This will multiply the effect of the reduction in Government help.

The (mainstream media) commentariat: early reactions to the Budget

An hour since the journalists were unleashed from the Budget Lockdown, and the early reactions are trickling in. Here's an early roundup.

Shaun Carney, The Age: "Those who were hoping for a major redirection of the economic and social course of this country under a new government will be disappointed. This budget reflects the gradualist nature of the Prime Minister, the Treasurer and most of the Government's leading figures. It's fair to say that the budget represents a tentative step towards a very mild form of modern social democracy, built on many of the precepts of the previous government, such as personal choice when it comes to the public/private split in health and education."

Paul Kelly, The Australian: "The budget reality dismisses the phoney symbolism of recent days. It is not a Robin Hood budget. It is not an attack on middle class welfare. It does not involve a major dismantling of Howard government programs. This trade off between beating inflation and backing working families will make or break this budget. It is highly optimistic. It is faithful to Labor's political pledges but tests the economic proposition that working families can be compensated at length from the inflation struggle."

Samantha Maiden, The Australian: Wayne Swan’s budget razor for families enjoying middle-class welfare, including the baby bonus, isn’t quite as sharp as it sounds. While the decision to ban the lump sum for the baby bonus and introduce a $150,000 means-test for both the bonus and family tax benefits is likely to capture the headlines, it also remains a small proportion of the $33 billion in savings measures the Rudd Government has announced. A tightening of exemptions for fringe benefits taxes, new taxes on crude oil condensate that will deliver a massive $3.5 billion over four years, increases to taxes on alcopops and a previously announced decision by Labor to slash tax cuts for people earning more than $180,000 delivers the lion’s share of the extra cash.

Colin Brinsden, The Daily Telegraph: The Rudd government's first budget is like going to the dentist. There has to be pain now or the future health of the economy is at risk. And like any dentistry, it comes at a price. Rich families, or those on $150,000 or above, will not like the decision to means test the baby bonus and the family tax benefit part B. The luxury car tax will increase to 33 per cent from 25 per cent and a loophole that governs the taxation of executive share schemes will also be closed. Twelve hundred public servants' jobs are also at risk as part of $33 billion worth of cuts in government spending.

Mark Hawthorne, Courier Mail: WEALTHY families are the losers under the first Labor federal budget in 13 years, with means testing and a tax crackdown helping to build a record surplus and three major new funds for future investment.

Scott Murdoch, The Sydney Morning Herald: Labor has delivered a moderate budget that it hopes will "build the nation" by dedicating spending on health care, welfare and infrastructure while winding back the direct benefits to the nation's well-paid. The first Labor budget in 13 years has maintained the tax cuts promised during the election and will now means-test welfare and the controversial baby-bonus which rises to $5000 from June.

The Daily Telegraph: "The opposition will no doubt point out that groceries and petrol will be no cheaper tomorrow morning than they were before the budget was handed down tonight. But it will be hard for them to punch holes in a budget which delivers a record $21.7 billion surplus - well above most predictions - and still cuts government spending."

Enjoy.

UPDATE 3:06pm, 14 May 2008 - grabs from the Budget 08 section of today’s edition of Crikey

Wayne Gump balances the soft and hard centres (Bernard Keane):

At Crikey we’ve been regularly asking whether the Rudd Government will be a State Labor-style bunch of spinners and shysters who will not lead but manage, and manage at best only competently, and possibly much worse. That question has now been answered – mostly, but certainly not entirely, in the negative. Swan had to get the right balance between a booming resources sector and a global financial crunch. Sure, he could’ve -- should’ve -- hacked into spending by another few billion, but we say that about 9 out of every 10 budgets anyway. The extent to which Lindsay Tanner’s ongoing review process will be allowed to cut the currently forecast 4% growth in real spending in 2009-10 in the next budget will demonstrate whether Rudd and Swan have retained what fiscal rigour they currently have.

Both the Prime Minister and his Treasurer clearly have a State Labor Premier’s terror of unpopular decisions -- but also have more vision and greater commitment to long-term change. In particular, it is clear that the Government’s rhetoric about a new approach to Federalism has real substance. For the first time ever, we have a Federal Government genuinely committed to urban infrastructure, hitherto regarded by both Labor and Coalition Governments as strictly the responsibility of State Governments.

Now, via Penny Wong’s $1.5b urban water initiative and the Building Australia fund, we have a Federal Government ready to undertake infrastructure investment in the places where it is needed most. Stephen Mayne today discusses the financial implications of these new funds, and the Building Australia fund is not without its political risks, as there’s always someone somewhere p-ssed off about new projects. But after generations of the Federal Government confining itself to rural and regional infrastructure as State Governments botched and buggered up our cities, this is a major and welcome shift in Federal focus -- as long as the allocation process can be kept free of political considerations and the intervention of Labor mates.

Swan delivers where it counts (Mungo MacCallum:

Modern budgets seldom contain any real surprises. Their economic significance is more about gathering up the outcomes from the year before and making invariably incorrect predictions about what they are likely to be in the year ahead. But if budgets have ceased to be pivotal economic occasions, they can still be important political turning points, and this applies particularly to the first budget of a new government.

What is expected from the incoming treasurer is a denunciation of the economic vandalism of his predecessor, who has left the place a smoking ruin, and a reconstruction plan that eschews short-term political advantage and stretches well beyond the next election, thus making the return of the government a patriotic duty for the conscientious voter.

Last night Wayne Swan showed that he had read the script, and if his delivery was plodding rather than dramatic, it did the job. Swan made it clear that there was a repair job to be done and that he was prepared to do it. At the same time the $40 billion investment in infrastructure, education and health showed vision for the future and the promise of better things to come. If he can report genuine progress in even one of those fields by 2010 the job will have been done.

Inevitably the gurus of the Murdoch press, who saw the budget as the Great Test for the Rudd government (Murdoch journalists love setting tests for politicians; it enables them to pretend that they have standards of their own), were dissatisfied. But while there was not enough pain, suffering and scorched earth to satisfy the more masochistic of the economic fundamentalists (the ones who complacently accepted the profligacy of the previous government for the best part of a decade) the punters would have felt a touch of the lash as well as the promise of good booty at the end of the race.

They have been enrolled as spear carriers in Rudd’s army, and their loyalty, if not absolutely assured, has at least been enhanced by the process. And that’s what the exercise was all about. Mission accomplished. The real work on the economy can now begin.

Kevin Rudd’s amazing iceberg budget (Possum Comitatus):

Hands up who’s thoroughly sick and tired of reading about how Kevin Rudd is John Howard lite, a bloke who substitutes spin for government activity in those times when he’s not actually doing the big “me-too”?

Finally, hopefully, we can all now put that piffle to bed.

The real Kevin Rudd has always been the Goss technocrat, the strategic policy wonk, the careful, cautious planner ad infinitum who draws policy threads together in a coherent broader tapestry, who melds electoral politics around concrete policy goals rather than wrapping convenient policy goals around base electoral politics. Last night the real Kevin Rudd became so obvious that even the laziest journalist should have been able to see it.

The future direction of health policy is a classic case in point. By doubling the threshold for the Medicare levy surcharge, not only will it start to dismantle the private health insurance gravy train as fewer people get penalised for not taking out private health insurance (becoming an effective tax break for those middle income working families to boot – the electoral politics), but it will to some extent increase the demand on public health resources in the future as a result, particularly the resources of the public hospital system. Yet Rudd has been banging on about reforming Commonwealth-State relations over health since he first achieved the Labor leadership. There’s the explicit threat for constitutional change to allow the Feds to take over hospitals if the States aren’t up to the job to implement reform, there’s the COAG health reform agenda and a bucket of upfront money being made available before the budget and now there’s a $10 billion health fund.

It’s not rocket science to see how it’s playing out – for those that say the budget lacked reform, open your eyes and stop looking at the world through a Howardian prism.

Rudd knows the demand shift consequences of moving the Medicare levy surcharge up the income ladder, he’s banking on at least the first tranches of reform, the low-hanging fruit – be it the increase in aged care beds to free up hospital beds, the construction of GP clinics to take weight off hospital emergency departments and the dozens of smaller front line reforms scattered through more than a dozen documents – to provide the hospital system with the increased capacity to absorb the consequences of this initial reshaping of how private health insurance works in practice. As time moves on, private health insurance will be further reformed with the broader health system as a whole – the scene has been set and the trajectory pretty much laid out.

Too often we all seem to expect reform to come in some big-bang document titled "Reforming Policy X" where we can all follow the flow chart. A sort of idiot's guide to policy change where winners are easily determined and losers are identified in bright red circles.

Undoubtedly there will be some of those in the future (the not quite so root-and-branch tax review springs to mind) but there’s a whole lot more going on in this budget below the headlines and the PR management. We might all need to start thinking in more complex ways on how government initiatives interact with one another if we are to get to the bottom of the deliberate, broader sweep of government policy direction because Kevin Rudd and his government certainly are. The Opposition is certainly not and governments need to be kept under credible scrutiny.

Budget plays Malcolm Turnbull for a fool (Bernard Keane – again):

Earlier this year, on issues like the apology to the Stolen Generations, and the 2020 Summit, the Prime Minister used declarations of bipartisanship to play Brendan Nelson off a break. For a long time, Nelson was wearing the fixed grin of someone who knew he was being treated like a mug, but didn’t have the faintest idea what to do about it.

Now the Government has used the Budget to hand out similar treatment to Malcolm Turnbull.

Turnbull has already demonstrated a willingness to take risks as shadow Treasurer. His whole "what inflation?" routine flies in the face of every credible economist in the country, not to mention the Reserve Bank and Treasury. So the Government gave him enough rope to hang himself with in its pre-Budget rhetoric. Rudd, Swan and Tanner endlessly talked about how tough the budget was going to be, and how unpopular many of their decisions would prove, and Turnbull took the bait, repeatedly warning against substantial spending cuts.

Now the Budget has delivered what Swan termed a "mild tightening" of spending – 1.1% real growth, well below the spending increases of recent Coalition budgets but still not the wholesale slaughter of the first Costello effort. The meat axe was nowhere to be seen – just a rather bloody scalpel which has been used to cut a few programs out of every portfolio.

Turnbull was left with nowhere to go. He’s been played for a mug. So, with nothing else to do, he turned on a dime last night and began criticising the Government’s profligate spending. You get the feeling that another billion or two in cuts and he would’ve been getting stuck in about that, in line with his original strategy.

Some Liberals are still adjusting to their changed circumstances. One backbencher yelled out "give them back" when Swan last night noted that the surpluses belonged to taxpayers, suggesting the Budget bribe mentality dies hard in Liberal ranks. There’s also press speculation about possible amendments to Budget measures in the Senate. If they have any brains, the Coalition won’t go near that. The Government would love to have a double dissolution trigger up its sleeve.

And we’ll be seeing a lot more of this "politics of envy" rubbish from the Opposition. It’s a ridiculous cliché, dreamt up by conservatives to demonise anything faintly progressive in government taxation and spending policies. Taken to its logical extreme, it means we should abandon progressive taxation and give everyone a set amount of Government payments, regardless of circumstances.

The electorate also reckons it's rubbish, with means-testing having widespread support – and at lower levels than $150,000.

Will the budget remake Howard’s Australia? (Clive Hamilton):

The budget, and the reaction to it, are a good test of the extent to which the Howard Government really did transform Australian society. Have Australians become less egalitarian? Do the middle classes have a new sense of entitlement? Has social justice been killed off?

Although the budget was not a serious attempt to choke off the rivers of revenue that flowed into middle-class welfare under Howard, the new Government had a plan to create the impression that that was what it was doing with its big leaks about changes to the Medicare Levy Surcharge, means testing the Family Tax Benefit Part B and raising the tax on luxury cars.

The Government clearly believes there is political mileage in projecting itself as taking back fairness -- "a Labor budget" the Treasurer intoned -- so they must have had polling and focus group research showing that most Australians felt the Howard Government had gone too far in molly-coddling the wealthiest third of the community.

Last week’s Newspoll results, showing that large majorities favour means-testing, with large minorities favouring it for anyone above quite modest incomes, were a reminder that Howard has been only partially successful in reshaping Australia on the American model. The survey indicated that he had been most successful with those who had grown up under his rule, respondents in their late teens and twenties.

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A Tale of Two Australias

I heard a sad tale of the other Australia yesterday, from the horse's mouth.

Mr and Mrs X have run a small business for some years - it provides a modest living and requires a lot of work and long hours.  At 67, Mr X, who started work at 14, and used his retrenchment payment from a bank to buy the business, does not feel able to take on  a new 5 year lease, which is now up for renewal.   The business has been for sale for 12 months, with no takers, so will close.  The business was intended to be his superannuation.   He has now applied for a pension.

Mrs X has some health problems, including cataracts and some physical problems.  She has not had them treated because she is needed daily at work;  but they are making her unable to continue.  She is 61, and has to go on jobsearch.

I expect that there are many such stories out there.  Hard workers, good citizens, a less than optimal decision, and.... ending your life in poverty.

You been reading my mail?

F Kendall, sounds like me!

Rudd and Swan overlooked struggling pensioners.

The National Seniors Association has slammed the Government for overlooking struggling pensioners in favour of working families.

Chief executive, Michel O'Neill, said older people entirely dependent on the single age pension - often women with no superannuation due to the circumstances of their times - represented Australia's most vulnerable seniors.

"These people who live off $273 a week while grappling with significant food, fuel and health cost increases are now starting to feel excluded under the Rudd Government's Working Families mantra," said Mr O'Neill.

While handing out billions in tax cuts to working families the Rudd/Swan budget overlooked people on the single aged pensioner. Australia is one of the richest countries in the world. We have a budget surplus of over 22 billion dollars. It is sad that we are also one of the meanest when it comes to the aged pension. How can anyone live on $273 per week? You would be lucky to find a rental property for that kind of money. The fight against inflation should not be at the expense of our most vulnerable.

Rudd the Dud

John, I told you not to vote for Rudd. Now you will have to live with these incompetents for a couple more years. As inflation climbs in the next 12 months the plight of the pensioners is going to get worse, and Swan and Tanner will just go on blaming the previous mob. Typical of union hacks when they cannot handle things.

Then we get this nonsense in the news today:

"Mr Moss's haul from the investment bank he joined three decades ago is made up of a $24.8 million pay packet for the year, a bonus of $24.8 million and more than $30 million in Macquarie-related shares he has bought over the years.

Macquarie Group recorded its 15th consecutive record annual profit under Mr Moss's leadership yesterday. Profit rose 23 per cent to $1.8 billion.

John Robertson, the secretary of Unions NSW, said Macquarie Group's pay for senior executives was "ridiculous in the extreme" at a time when workers were being asked to show wage restraint".

If union hacks and people like John Robertson had worked as hard, the unions would have a larger number of members instead of the pitiful state they are in. If Swan and Rudd were as smart as Mr. Moss maybe they could help the pensioners.

The Times They Are a'Changing

A very interesting article by Robert Gottliebsen in todays Business Spectator about where means testing et al are going in the next 12 months, and the changes that are coming.

http://www.businessspectator.com.au/bs.nsf/Article/New-tax-targets-ES9SM?OpenDocument

Tax is so much fun

Taking away the $8000 rebate for solar panel installation is interesting. It was hardly making a dent on the bottom line - and one would suspect making it more expensive is not going increase the take up rate.

Why would a government make a move such as this? Being the cynical type I think it's fairly easy to work out. The "want" for solar power will not eventuate until price dictates that it's economically viable. Now when do those massive revenue raising carbon taxes come in again? The ones that the average household (100K) will be paying triple prices for?

Just like the English government, I think it fairly easy to work out what "climate change" means for its Australian equivalent.

Desley Boyle and more ...

A riddle for the ageing and infirm: what’s the difference between partially superannuated, low income retirees forced prematurely from the workplace by ill-health or “early retirement,” and superannuants over 60 years of age?

Answer: the first group is income-taxed, the second not.

The first group was often savagely Medicare levied too, although receiving zero health coverage from private insurers which waxed as fat as private schools on government subsidy.

As our great and powerful friends might say, go figure.

Dr Woodforde, OAM

Is this possible?

How can we judge this budget in terms of measures to reduce Australia's emissions? The first word that comes to mind is generous: more than $2.3 billion to tackle climate change over four years is not to be sniffed at. Given the potential security implications of climate change, one could argue that $22 billion on defence is also helping the country respond to possible security threats. And $20 billion in new infrastructure funding could help alleviate congestion, greenhouse pollution and our reliance on the car as the primary means of transport. A federal administration focused on investing in modern public transport infrastructure will do more for the long-term emissions profile of our economy than doubling expenditure on eye-catching rebates and websites.

The real task is decarbonising our energy system, mandating greenhouse efficiencies in buildings and investing in alternatives to the archaic road-building mentality. The headline investments in the budget are $500 million over eight years for clean coal, and an equal amount over six years for renewable energy. Why should Australia spend such an inordinate amount on an as-yet-unproven technology of pumping carbon dioxide underground? Because we must remain fiercely pragmatic about which technologies and approaches are going to help achieve the emissions reductions that our long-term energy and climate security requires.

Given Australia's position as the world's largest coal exporter, one tangible way that Australia can position itself to tackle emissions in the countries where the substance is polluting our atmosphere, is to lead in the technologies that could ameliorate its effects. Is this possible? We will never know unless we invest in answering the question.

John, isn't it possible that we don't need to make it an "either/or" question when it comes to investment in various methods of tackling climate change?

Can you see that it doesn't have to be either renewable energy or "clean coal"?

Couldn't we have investment in both renewables and "clean coal" (and I do agree btw that "clean coal" is a misnomer, but saying "use of coal in an environmentally satisfactory and economically viable way" is cumbersome).

Couldn't we have a viable "both/and" solution if we set up the "either/or" another way: Either waste more money on getting ourselves involved in other countries' wars or invest in living sustainably and peacefully within our part of the world?

"Clean coal"

THE Rudd Government is believed to have earmarked $275 million for six new clean coal projects in its first budget next week, alongside similar funding for renewable technologies.

A clean coal council and a taskforce to develop storage options are expected to form part of its $500 million commitment to clean coal made during last year's election campaign.

These new funds for clean coal technology follow $350 million committed to technology development under the Howard government's Low Emissions Technology Development Fund.

Craig, a lot of the budget money is going to the coal industry to develop clean coal technology - a technology that is not a solution and will not reduce CO2 levels. The coal industry needs to pay for this technology, not taxpayers. Has any thought been put into the time frame needed to develop clean coal and the enormous cost of moving all coal fired power stations to clean coal? We won't see it in our lifetime. We need to put big money into renewable energy now.

Putting money into coal is like putting money into horse and carts at the begining of the 20th century. It is old technology and should be phased out.

The first commercial scale Carbon Capture and Storage (CCS) is at least five years away. We do not have the time.

Industry estimates suggest that the first commercial-scale CCS test plant will be running some time between 2012 and 2015, but the timetable has looked vulnerable after recent project cancellations in the United States, Britain and Canada.

If the plant is ready in 5 years time it may cost as much as a trillion dollars a year to roll out. Where is the money going to come from?

A rule of thumb suggests CCS would add half again, or about 500 million euros ($786.8 million), to the capital cost of an average-sized demonstration coal-fired power plant.

Multiplied across dozens or even hundreds of power plants that implies a market in the hundreds of billions of dollars.

"For 2030 we estimated it could be between 76 and 225 billion euros per year," said Societe Generale analyst Sarbjit Nahal. "Some people say as high as one trillion euros."

Clean coal technology will not be able to compete with renewable technology it is a waste of money and if it wasn't for the coal industry lobby we would not even consider it.

They're about as "Green" as me

I thought reading the budget papers the 100K was measured as a combined income. I don't think in Australia 50K is even the average wage, is it? Seems to me that apart from the mooted revenue raising carbon taxes (only so far alcohol can go I suspect) this green stuff seems a little, well, contrived.

A deeper social attack

Jenny Hume: "Paul, if they are so harmless one might ask why they are so popular with the young teens amongst whom there is a very big drinking problem in this country."

I'm not writing these drinks are "harmless". What these beverages are is a legal product,a product the law states should be consumed with age restrictions applying. If Australians find it so difficult to control their own laws,perhaps an executive from Bacardi or some such could be made head of state? The surplus could easily pay the wage.

The anti drug message has been class conscious ever since beer, and gin lane. Drugs of course are meant to be "fun" - that's why they're so popular. Raising the taxes isn't going to take that "fun" out of them - merely make it an exclusive part of "selected" people' lives.

Strange thing about it all is I can go to the area Dr Feelgood clinic (affordability of course makes us special) and receive any number of boxes of magic (any number of products and all very legal). Shoot, I can even get a highly qualified doctor to give me excuses (justification to myself) of how much need these things - of course, both he and I know it's all in the aid of being high - and of course I've earned that privilege. Think country club, private club, exclusive cocktail bar etc - makes no difference.

Work a shitty job, and live a shitty life, and you need to be socially controlled. Personally I think these people have earned the right to be high as much or even more so than any single one of us.

A person has a bar, and wine celler, and that's a person of class and grace. Drink a cheap drink with not much else going for you, and you are a social menace. Always been this way, and will always be this way. This current attempted social nonsense is about nothing more than control - control of people of course who easily controlled.

...ponders

There seemed to me to be quite a few small but worthwhile parties on the Senate ticket.  I wonder why they don't amalgamate with the Greens. 

Power struggles?  Narrow focuses? No doubt much else?

However, I would suggest that this budget had to trip the narrow road of fulfilling election promises such as tax cuts, while containing inflation in the face of rising interest rates, which would have been electoral poison;   therefore, although I don't like their choices, I will give them another year before damning* them.

*meant colloquially, of course.  I won't really wish them to hell.

Labor has lost its green credentials. I feel I've been conned

Labor's decision to means test solar-power rebates for houses has caused the Liberal Party and Greens to join forces behind an industry incensed at the change.

The budget stipulated that the $8000 grant for installing photovoltaic cells would be denied to households with an income of more than $100,000. A typical unit, which provides solar electricity for the home, costs about $20,000, meaning a householder still has to pay up to $12,000.

It seems Alan Curran and Eliot Ramsay have been correct all along - Rudd is a dud. This budget was a chance to change direction to take money from the coal industry and use it on renewable energy. I spent months helping to put Jim Turnour and Kevin Rudd into government because I believed they would do something on climate change. I feel I have been conned.

Fiona: Perhaps you should email both Turnour and Rudd, John.

Conned

John, I really feel sorry that you feel conned by Rudd the Dud, but I did warn you during the election that this would happen. The only ones who will benefit from a Rudd governement are Sharon Burrows and her union hacks. Just wait till they start flexing their muscles.

As inflation rises and we have more interest rises Rudd's "working families" are going to do it tough. Then of course if we factor in the rise in unemployment (certain under Labor) there are going to be tough times ahead. At least I was fortunate to be able to fireproof myself from the Rudd and his incompetents.

If you are looking to the Greens for help, thay will not be a viable party till 2060 and if your climate change predictions are right, it will not matter anyway.

Conned, why don't Labor and Liberals amalgamate?

Fiona, I will send an email to them. Although I did help Jim Turnour, on your advice I voted Green and I am glad that I did. Next election I may help the Greens. I just wish the Labor and Liberal parties would amalgamate. There is very little difference between their policies. The only difference seems to be a tax on alcopops. I wonder how many other Labor supporters feel they have been shafted.

If you have been conned it's due to misinformation ...

... by those cutting from media space any mention, John, that the Rudd Government allocated $300 million over five years to the Green Loans program, which will help households install solar, water and energy efficient products. 

Don't you think that for those with incomes of over $100,000 per annum a low interest loan to encourage making the investment to increase their property value (as well as enjoy the energy efficiency dividend) is more appropriate than a grant (i.e. a "freebie")?

"Climate change is the defining challenge of our generation."

Environment Minister Peter Garrett announced in the budget that from yesterday only households earning less than $100,000 would qualify for the rebate.

Energy Matters spokesman Markus Lambert said the means test would wipe out most of its solar-panel sales in the nation's biggest cities, saying more than 30 contracts had been cancelled after people were told of the change, with about another 20 considering whether to continue.

Without the rebate, the out-of-pocket costs to put in an average solar-panel system more than doubles from about $5000 to $13,000.

Craig, I think the people on less than $100,000 are not going to be able to afford a solar panel system. A $5000 outlay for them is a big decision. Should they put a solar panel on their roof or pay $5000 off the mortgage? For people who can afford it - those over $100,000 - the price has just trebled. Sales of solar panels are going to tumble. This is not about welfare, it is about bringing our emissions down. It is about giving support to a sunrise industry of solar power.

"$300 million over five years to the Green Loans program," This is a pittance, this is not taking climate change seriously. For a party the campaigned heavily on its green credentials this is a shame. Rudd says climate change is the defining challenge of our generation.

"They will set Australia firmly on the path of achieving our commitment of 60 per cent reduction in emissions by 2050.

"Climate change is no longer a distant threat, it is emerging reality. In fact what we see today is a portent of things to come.

"In Australia, our inland rivers are dying, bushfires are becoming more fierce and more frequent.

"Regrettably it is now an increasingly familiar story across the globe."

"Climate change is the defining challenge of our generation," Mr Rudd said.

Climate change the greatest threat to our nation and Rudd has done next to nothing. It is business as usual for the coal industry and a reduction in our roll out of solar panels. We should not be spending money on the coal industry that money should be use to develop renewable energy.

The other problem we face is peak oil. One of the big drivers of inflation is the cost of oil.

Oil prices have hit a record high above $US127 a barrel on fresh worries about global supplies.

US light sweet crude jumped to $US127.82 a barrel, ignoring a forecast from producers' cartel OPEC this week that the world will need less oil in 2008.

How much do you think we will be paying for oil this time next year?

The Rudd/Swan budget did nothing about the rising cost of fuel. Instead of giving money to the coal industry, how about reducing the taxes on fuel efficient cars? How about getting serious about manufacturing fuel efficient cars in Australia? How about giving us a financial incentive to buy Australian made fuel efficient cars?

This budget lacked vision and did nothing to protect us from Climate Change or the rising cost of energy. It could have been a Howard/Costello budget, what would have been different?

It is a shame on the Labor party and I am sure thousands of Labor supporters will like me, be very disappointed.

A copy of this will be sent to Mr Rudd and Mr Turnour.

 

 

 

Taking climate change seriously?

When the Howard government introduced the $8,000 solar panel rebate it said it expected 14,000 households to take up the grants.

Remember that? How many households actually did act seriously on climate change and take up those grants?

Here's something of substance not picked up and reported in the media:

Even without means-testing, the $8,000 rebate has only encouraged a little over 3,000 households to install solar panels this financial year (to the end of February).

With respect, John, your critique of the Rudd government for being "not taking climate change seriously" should logically be extended to all those households that could afford the investment and didn't take it up when the grants weren't means-tested. They were "not taking climate change seriously."

Your critique should also now be extended to the households with more than 100K income who'd choose to snub an investment in solar panels simply because ... boo hoo ... they're now only able to access government assistance in the form of a $10,000 low-interest loan (rather than take an $8,000 freebie).

Meanwhile, all the millions set aside for solar panel grant money remains available to thousands of those households with less than 100K income should they choose to take climate change seriously (and invest to gain an energy efficiency dividend in reduced energy costs year in and year out).

Oh ... and please let's not overlook the other couple of billion dollars allocated to tackle climate change just because we're upset about some people needing to take climate change sufficiently seriously to actually invest some of our own money should we bring in more than 100K a year. I mean if they took climate change seriously enough and made that invesment it's not like they'd be akin to alcopop drinkers just pissing their money away.

Hear, Hear John

Hear, Hear, John Pratt. 

Budgets always seem to be full of gigantic expenditures on the one hand, and miserable, niggardly little savings that keep some people in subsistence, penny pinching circumstances on the other.

I am offended that they talk of a budget "surplus", when there are so many unaddressed needs.  It seems to me rather like building a healthy bank balance by not feeding the children.

And, is means-testing the solar rebate such a good idea?  After all, each household that brews its own power advantages all of us.

Maybe next year.  If we pressure them.

Let older people work without losing their pension.

The Queensland Tourism Minister, Desley Boyle, wants pension rules relaxed, so that older people can work without losing their pension entitlements.

"If we could harness the skills, knowledge, and abilities of the retiring baby boomers it could contribute significantly to easing the regional shortages", Ms Boyle said.

"I have had people suggest to me that they would jump at the opportunity to work in regional Queensland, but current pension restrictions don't make it financially viable.

"A lot of people are financially limited by their pension situation and we may be turning our back on the perfect labour market if something is not done".

A good idea put forward by Desley Boyle. Our regional areas are suffering from labour shortages and often aged pensioners with 40 or 50 years of experience are sitting home because they are financially penalised if they work. As we are all aware we have an ageing population and we must make it easier for pensioners to contribute to our economy. It would be a win win for all. More tax for the government, more labour for suffering industry and more money for pensioners. It's a no brainer. It should have been brought up at the 2020 summit.

Humans are strange indeed...

I'm intrigued that raising the price of alcopops won't lower the consumption rate at all, whereas it seems to have been accepted for years that raising the price of cigarettes was a succesful way of curbing smoking.

There was, of course, the woman whose New Year resolution was to drink less, so she changed from pints to shots....hmmm, yes, probably quite irrelevant.

Alcohol costs $15.3 billion per year. We need more tax on it.

Brendan Nelson's answer to the budget is to oppose the increase on alcopops and give us a 5c cut on fuel excise. His idea that increasing the cost of alcopops will only shift the market to other alcoholic drinks or drugs is a joke. Surely he should have argued that the tax on all alcoholic drinks should be increased. The damage done to our society by abuse of alcohol is enormous and the people who over consume alcohol should be made to pay for it.

Of the total social costs of drug abuse in 2004/05 of $55.1 billion, alcohol accounted for $15.3 billion (27.3 per cent of the unadjusted total), tobacco $31.5 billion (56.2 per cent) and illicit drugs $8.2 billion (14.6 per cent). Alcohol and illicit drugs acting together accounted for another $1.1 billion (1.9 per cent).

With the Liberal mantra of user pays surely the tax on all alcohol needs to be increased.

To say we should reduce the tax on fuel by 5c is ridiculous. With the cost of fuel likely to be over $2 a litre by the end of the year, what difference would 5c make? We should be reducing the tax on fuel efficient cars and encouraging research and manufacture of fuel efficient cars that is what will bring down our fuel costs.

Alcocrap

Richard Tonkin: "There's a problem. Cure it. Or am I thinking too illogically here? It all depends on long-term agendas."

Nobody, anywhere, really wants to cure it - hell, we all use or have used these types of products (alcohol etc) from time to time - and the industry world wide is worth a pile of the good stuff. Similar to the environment it's a good issue for people to get some moralizing points on - for the government extra revenue (on further beverages) in the future.

The "fight" against "alcopops" (it's not just happening in Australia) relies on classic downward envy. The drinks themselves are a complete rip off. The alcohol content is low, and the price is high - and of course the country club type wouldn't be seen dead with them. That's for nascar dad, and trailer park mum.

As to appealing to children, huh? What fictionous nonsense - that's the reason for drinking age laws. Seriously, "alcopops" were first witnessed in the early 90's; there's a lot of people (including myself), whose first alcohol beverage was not an alcopop (like every generation before mine).

All societies have differences when it comes to alcohol - the USA for example is a lot tougher on what behaviour it perceives to be that of an alcoholic - a lot of Australians wouldn't pass the test. Of course the USA naturally forgets it's the world champion of drug abuse (both legal and illegal). Just subtle differences in culture I guess.

Al Sharpton once made a good point about drugs (about the only good point I think he's ever made). He asked why is it that the indictable offence for a quanity of cocaine was so much higher than for crack? I don't think anyone needs to think very deeply for the answer on that.

What the hell is it with Australians and love for being taxed anyway? In most places, continual government surpluses (when the government owes nothing), along with adding even further taxes, would be seen as the outrage that it most certainly is. Damn, Austalia, you're fast becoming an entire nation that reminds me of the story about the very liberal lady in the midst of passion: tax me, tax me, tax me.

Alcopops and solar hits

Paul, if they are so harmless one might ask why they are so popular with the young teens amongst whom there is a very big drinking problem in this country. Now some might disagree with that but that was the problem Rudd claimed the tax was designed to address. Could it be that he is just being dishonest here, seeing it as just a tax bonanza? What will he do if his plan comes off and the kids avoid the stuff in droves and the 3 billion becomes a trickle? Stand by Richard, all that chateau cardboard in your cellar might have to fill the gap. OK Ok you don't do CC, only the best of Margaret River - not that I could tell the difference mind.

If the alcohol in these drinks is so low then why put it in there in the first place? Because the kids won't buy it otherwise?

Of course the country club set would not be seen dead with them. So you would agree that certain alcoholic drinks are intended to target certain groups? So for the teens, get them started on the alcopops and future grog sales and profits are assured.

Now about solar. Rudd claims he is serious on climate change and then he goes and means tests people wanting to put in solar panels. Great. The very people who might be prepared to outlay the $12 000 net required to install the panels will almost certainly think again. Few with a mortgage or a family on under $100 000 would have been able to affford the things anyway. So there's one growing business that has just taken a big hit from Rudd. The coal industry chiefs will approve. The least he could have done was set the means test at something approaching a sensible base income figure.

Taxes? Well I guess this country will always have high taxes. The population is small and the country big as you know. So if we want a road from Sydney to Perth then 20 million people have to fund it, while over there you could call on how many - 300 million? Kinda makes a difference. But you know that.

Well, of course, I didn't actually watch the speech

why would anyone do that?

I just saw the clip on the 8:30ABC news, where the soundbite "parenting, where it involves young people" (I accept the irrelevant correction) jumped at me ...

It seemed more sensible, anyway, than getting irate about increasing tax on alcopops: what in god's name constituency does he think he's appealing to by getting angry over that and luxury car tax and medicare tax cuts. He's gained the votes of under-18s, those mercedes buyers who care and weren't already on his side, and senior managers in health funds. Probably will put his approval rating up from 9% to 9.01%.

Oh, and then he loses the votes of the half million people who lose their tax cut (insofar as any of them were on his side anyway). So maybe net net 8.99%.

Likewise, I didn't watch Swan's speech either, I read the Budget papers on the Treasury website - I prefer to get facts from the source.

Medicare tax cuts

Well David: Given the state of the public hospital system and the fact that the population is ageing, I think quite a few people will come to see that medicare tax cut as unwise in the medium term, and certainly in the long term.

There is enormous pressure already on the public health system. No doubt many thousands of young people will drop out of private cover and private fund premiums will inevitably rise. Such premiums are already very high and the likely fallout of hefty rises there will be that many older people will no longer be able to afford that cover and will be forced to drop out as well, and fall back into the public system.

Such is the pressure of the ageing population that it now takes several months under Medicare to even get a stress heart test done at the Canberra hospital. If you have private cover you can get that done in two weeks in the private hospital.

Not having private cover these days is taking a big risk with one's life. A blocked coronary artery does not like waiting for three months to be diagnosed. People drop dead in that time.

If a large number of people both young and old drop out of private cover albeit for opposite reasons, (one to save the tax, the other because of rising cost of cover) the public hospital system will be even more stressed, and people will die waiting even longer for the most basic diagnostic tests.

Yes I think the Medicare tax cut is very short sighted indeed.

'Parenting' & wall to wall babies

David,you obviously do not live in Sydney's Eastern suburbs or you would never have asked that question!

Take a walk through some time and you will see all those 'parents' out with their pampered 'offspring', clipped and coiffured, some elegantly clothed in jackets and ribbons . . .

Of course, had you been in Bondi Junction yesterday morning you would have ran into peak hour type, no room to move traffic ---- except that it comprised of a million prams, strollers and such with real little human inhabitants, with occasionally two to a conveyance.

I asked a young mother the reason. It seems that Bonds were looking for the summer baby!

Me, confronted with such a mammoth display of massed opposition would have given up and gone home!

Brendan's best line ...

... in his reply speech:

"Parenting, where it involves children ..."

As opposed to the other sorts of parenting? 

Best line

David Roffey, how about the number of times Swan said "Working families" in his speech, and I wonder how many of these will have jobs at the end of the year. Anyway you are wrong about what Nelson said, read the transcript.

Brendan's line

David, the closest thing I can find to that line in the copy of the reply speech online is this:

A real strategy to deal with alcohol abuse and anti-social behaviour demands an integration of education, prevention, policing, media, appropriate pricing measures and parenting where it involves young people.

Unless Dr Nelson fouled up the delivery - I didn't see it on video, only read the transcript - then it would seem to make perfect sense in the context of the sentence.

The first five measures he lists would seem to be general strategies in the fight against alcohol abuse and anti-social behaviour while the last one is specific to such abuse and behaviour amongst young people. The "it" would be the abuse and behaviour, would it not?

On Brendan's lines

I write the following as a swinging voter.

Being Opposition Leader is recognised as the hardest parliamentary job of all.  Apart from the political skills required, it needs the acting ability of a Larry Olivier or a Richard Burton (forget Mel Gibson; forget Harrison Ford) particularly when one is called upon to do 'indignation' and the daunting 'outraged indignation'; which is all too often.

Brendan Nelson began his exposition phase well, with some declamatory 'indignation'. Then he had to negotiate the minefield of alcopop, and in the process did 'sincerity' so well that there was not a single cry of 'hypocrisy!' from the stunned mullets on the government benches.  Next he moved into development and variation on his opening theme and announced how he would use the Senate numbers to counterattack. An opposition is always healthiest when it behaves like a government, and Nelson knows and said it: "we are not an opposition; we are the alternative government" or words to that effect.

As in a sonata, he had begun with exposition, moved in to development, and then finished with a recapitulation of his opening theme. It was in this third phase that Nelson sprang his biggest surprise and emerged as the consummate actor he clearly is. Instead of trying for uninterrupted ridicule as we would expect from The Smirk (who was sitting up there like a galah on a backbench, smirking away), or doing non-stop 'righteous indignation' as we would expect from Malcolm Turnbull, he lowered his voice and did the last part in something just above a stage whisper, so that all had to strain to hear him. At that stage you could have heard the proverbial pin drop.

I have seen a bit of parliamentary histrionics on TV, but that was the most accomplished example of the thespian's art I have ever seen delivered in the House.

Those in the Liberal Party who want to replace him are desperately in need of a brain transplant. Each.

What has Brendan been watching?

There's only one plausible explanation: Mr Nelson went to see Molière yesterday evening.

Mind you, I’d commend it to any interested Webdiarist.

I'd rank him with Dakota Blue Richards

In particular his surprising capacity to act in relationship to invisible bears and daemons.

PS: photo of Brendan being supported by Malcolm Turnbull here

Alcopop tax into Live Music.?

Trust me, you don't see much in the way of chug-a-lugging at gigs.  No Porshe in my driveway, QED.

Sorting out the social aspects of when and where these drinking binges are occuring and creating solutions would be a more humane approach than attempting to tax the problem out of existence.  It will fail.  Turps for burps, wasn't it?  It's not only love that will find a way.

There's a problem.  Cure it.  Or am I thinking too illogically here?  It all depends on long-term agendas.

I was out the front of the old Women's Temperance Union building the other day, thinking about how they marched to bring in 6 o'clock closing.  Remember the 6 o'clock swill?  The WTU did a great job, hey?

I was impressed

I was impressed with Nelson tonight. Nothing wishy washy there and I think the man is a genuinely decent person. He should be given a chance, instead he has been struck down from the day he stepped into the driving seat. I find Turnbull far less convincing and credible. 

There was as he says nothing in the Budget to help struggling rural and regional Australia and pensioners missed out altogether at a time of rising costs, while carers have been left up in the air. And families should look closely at the definition of income for the intended family allowance means test.

Nelson is quite right about the alcopops issue. It is just a cynical tax raising stunt. If the tax is destined to bring in around 3 billion then it is hardly a measure designed to cut the use of the drink itself.

As he says, it will take far more more than a revenue raising tax to deal with the social fallout of binge drinking by the young. And yes Dylan, I agree with your grammatical interpretation of the line that David queried. That was just nit picking anyway.

Those alcopops should never have been allowed on the market in the first place. Kids are now hooked on them and you only have to look at what kids would no doubt call the groovy design of the labels and the names to see that that was the intention. Lacing drinks with vodka and other spirits for heavens sake. No wonder the kids are off their faces.

Prohibition

Father has smelt it coming for some time.

and the mechanism for banning alcoholic drinks is ...

what?

Who should have "not allowed them on the market"? Oh, that would have been the government of the day when they arrived (Liberals, probably). But Mr Nelson is angry that they're going to be more expensive, and thus he wants the kids to keep getting their cheap alcohol fix (or they might resort to "drugs" instead of, er, the most dangerous drug of all), and he's going to vote his temporary Senate majority to keep those kids pissed throughout the winter. High moral stances to the gentry.

Seems to me a bit churlish

A bit of churlishness do I detect here David? Why? Because Nelson really did pick some rather neat holes in the Swan's song?

And what? Ban alcoholic drinks. No just those that are deliberately designed to hook in young teens in order to ensure the future profits of the liquor companies.

BTW: If you were asking me (as it seems you were while omitting the usual courtesy of addressing by name the person whose comments you are responding to), you can regulate to keep or take any product off the market. Products are withdrawn for all sorts of reasons all the time.

Oh but I forgot, that won't happen with alcopops because the kids have to be allowed to keep on bingeing, in order to provide the 3 billion for the Rudd Government. If Rudd were serious on this issue and not just concerned with the tax he sees he can raise here, he would legislate to have the stuff taken off the market altogether.

Maybe these kids that are clearly targeted with this stuff will in future, when they become alcoholics have a case at law against the liquor companies.

Not going back there

Fiona: "Paul, I studied Taxation Law in 1977 ... . Back then the ITAA was about 3 cm thick. These days the legislation is so vast and complicated that I doubt if even the top taxation practitioners in Oz would honestly say that they understand every nook and cranny of it."

I certainly wouldn't hold that against anyone. I did have a look over the budget - no problems there - Australian tax - far out!

The tax bit, is a big bit, to the point I think I'm making. So, yes, I could well be wrong. I did seriously attempt to decode that part of it (taxation) - ended with my best guess.

Yes, somebody should let the cat out the bag

Means testing and tax rises will hit the rich, but battlers will be protected as the Government cracks down on inflation in a bid to avoid fresh interest rate rises. Election promises, most notably the $31 billion tax cuts package, will be delivered. The surplus for 2008-09 will exceed $17 billion and could be more than $20 billion. Around 650 cuts and redirections of spending will yield billions in savings.

It's not a get the rich budget - that's only what certain sections of society are meant to believe - and it does appear up until at least this point it has been successful - getting those people to believe I mean.

1. Rich people get a tax cut along with everybody else.

2. The budget has not helped inflation at all. That means rich people get the advantage of higher interest rates. Due to inflation problems they will also NOT be overly punished for that windfall. It's about getting people to save, and all that stuff.

3. There is a reason the child bonus savings are not published - because the cuts affect hardly anyone (they're symbolic). The people that they do affect wouldn't care anyway - because tax cuts will be worth a lot more going into the future.

4. The types of luxury cars that people hope are affected are rarely owned in an individual's name. A car is a depreciating asset; thus it makes it tax effective for companies to have some depreciating assets (such as cars). Certainly I' am not an expert in Australian tax law (from my reading this does appear to be the case?). If so the tax paid would merely be returned over the period of depreciation (it becomes a part of that depreciation).

This leaves only large family cars (most aren't rich), and boy's toys (most aren't rich guys), being affected.

Tip: Avoid the taxes and buy a luxury car (personal car) traded in car (under a year old).

5. As a percentage rises in energy prices, and produce price affect poor people much more adversely. In turn these rises cause inflation, which in turn causes higher interest rates........

I can almost hear those rich Australians talking in hushed tones about keeping the secret. A good way of staying rich in a society of envy is crying poor.

The most interesting thing about the budget is the mooted future tax changes. The ones being touted as keeping, and getting high wealth individuals staying in Australia. I wonder if Robin Hood, and his merry man will be turning up at that conference?

Fiona: Paul, I studied Taxation Law in 1977 (and came surprisingly - to me - high in the class) in the final year of my law degree. Back then the ITAA was about 3 cm thick. These days the legislation is so vast and complicated that I doubt if even the top taxation practitioners in Oz would honestly say that they understand every nook and cranny of it. Same goes for our legislation about superannuation, corporations, social security ...

Forget the price of beer and cigarettes.

FORGET concerns about budget-induced inflationary pressures. Australia should have much bigger things to worry about: chiefly trying to sustain our standard of living, and that of the world, in the era of anthropogenic climate change.

As one of the world's highest per capita emitters of CO2, Australia disproportionately contributes to the problem. The irony could not be starker: the cause of much of Australia's CO2 emission is mining and processing, which is driven by insatiable demand for resources by China and India, in turn increasing their emissions and making Australia rich.

Rather than banking the profits from this environmental feedback catastrophe for a rainy day, Australia ought to consider investments that help break the cycle in the long term and make everyone better off.

Problems such as climate change have no easy solution. Indeed, they may not have a solution at all. With regards to energy generation, a chief culprit of climate change, the approach favoured by many is the wedge model, in which we try to do everything: improve energy efficiency, substantially increase renewable energy power generation, make more efficient and reduce the intensity of fossil-fuel energy generation, and consider the greater uptake of base-load, low-emission energy providers, such as nuclear power.

Matthew Hole is chairman of the Australian ITER Forum and a scientist with the Australian National University's research school of physical sciences and engineering.

Mathew Hole in today's Australian.

Forget inflation or the price of beer and cigarettes. Australia is facing a much bigger problem - anthropogenic climate change. We are fighting for our standard of living and the government both liberal and labor seem unable to comprehend the enormity of the problem. We have a huge surplus we could invest in renewable energy, we could be building renewable sources of energy but no, we are going to put the money into the bank. And some time in the future we may build more train lines for our coal exporters or roads for our trucking industry. Scientist all over the world are warning us every day and still we have fools who are afraid to make the necessary decisions.

Budgets like these will not prevent the climate crisis.

Budgets like these will not prevent the climate crisis. We need to go much further, and we need to get there much, much faster.

That's why today we're launching GetUp's Climate Action Fund to match the might and muscle of the well-resourced polluter lobby, and demand real political action right now on climate change. We're kicking off with a massive billboard outside the PM's lodge.

So if you'd like the PM to see it everyday as he heads to work, click here to send some of your tax cuts where you would have liked to see them go in the Budget - fighting climate change:

www.getup.org.au/campaign/ClimateActionFund

Getup is urging Australia to use their taxcuts to fight climate change. Today they have launced a climate action fund. A chance for all of us to put our money where our mouth is.

Sacred cows protected at all costs

“The review will look at measures to strengthen the integrity of the temporary skilled migration programme; the employment conditions that apply to workers employed under the programme; the adequacy of measures to protect 457 visa holders from exploitation; and the English language requirements for the granting of migration workers' visas,” says Darrell Todd.

- 14 April 2008  

 

LESS than a third of people from non-English speaking countries who migrate to Australia on skilled workers' visas are gaining work in their fields and many of them are adding to the skills crisis they were brought in to solve, a study has found.

- 29 April 2008

 

Australia will boost its skilled migrant intake 30 percent to record levels in a bid to overcome a shortage of skilled workers, the government said Tuesday.

- 13 May 2008

Rudd and Swan failed the energy test. It is full steam ahead.

The real problem with the Rudd/Swan budget is the complete lack of vision when it comes to the issues we will be faced with in the next five years regarding climate change and the increasing cost of fossil fuels.

With predictions of an oil price over $200 a barrel we cannot continue to ignore the problems we have with the use of fossil fuels.

In the budget the outlays for solar energy is $386.3 million over four years, for clean coal $380.7 million and for renewable energy only $227 million.

This is nowhere near the amount that we will need to change from fossil fuels to renewable energy. The Rudd government has failed to prepare Australia for the economic shocks ahead. A million dollars spent today developing renewable energy will save us $10 million dollars in ten years' time.

We must forget the dream of clean coal and leave the coal companies to pay for the research for its development. We need to be focusing on solar, wind, geothermal, and wave energy.

We are on the Titanic and Captain Rudd has just rearranged the deck chairs. His government is not listening to the warnings of icebergs ahead.

A 20% surge in farm production Mr Swan????

A 20% surge in farm production for 2008/9 is predicted in the budget, or at least that is the report. One is yet to see the full details.

So all the weather forecasts that tell us that La Nina is over and that much of eastern Australia is slipping back into drought (as any fool can see by just driving outside the urban sprawl) are wrong? When all the news coming out of the grain belt is that prospects for a bumper crop are falling rapidly as each sunny day passes?

An agriculture minister asleep at the wheel it seems.

Not enough in the budget for climate change and peak oil.

Stephen Campbell from Greenpeace says the Budget missed opportunities to invest more money in alternative energy.

"In its first budget, the Rudd Government had a golden opportunity to show that it was serious about dealing with climate change," he said.

"Instead it has let us down by failing to invest heavily in the solutions that we have at our fingertips - renewable energy such as solar, wind and geothermal."

One thing that was missing from the budget was any new spending on climate change or peak oil. Stephen Campbell is correct when he says the Rudd Government has missed a golden opportunity. The longer we wait to switch to renewable energy the more the cost will be. The oil price is skyrocketing and the world is being destroyed by disastrous levels of greenhouse gas. Future generations will have to pay for our lack of foresight.

Not enough

John Pratt, I keep on telling you Rudd is a dud. He signed Kyoto and Garrett and Wong think everything is done. I would not take much notice of the things that Greenpeace says. They will say anything, a bit like Bob Brown and his nutters.

The "Nutters" are the real opposition.

Alan Curran, you must be happy. Rudd is doing next to nothing on climate change, you say we should not listen to Greenpeace or Bob Brown and his "nutters. The ALP is obviously the party for you. As I have said before, the ALP and the Liberals should amalgamate and the true opposition would be the nutters.

Nutters

John Pratt, of course Rudd is doing nothing on climate change, he is all talk and I am afraid this will apply to most of the things that he promised during the election campaign. As for Bob Brown and his nutters, what a great opposition they would make, all four of them. It really is hard to take them seriously.

Foreign aid

To be honest, very little in the budget - if anything at all - will affect us. We don't pay tax on our Australian income, we don't plan to return to Australia soon and we'll be bringing the kids up somewhere else. I skimmed through the budget speech anyway, however, and one thing jumped out, if only because it is of some personal interest.

The thing that stood out to me was a short sentence in the national security section of the speech which read:

And we will increase overseas development assistance to around $3.7 billion in 2008 09, from about $3.2 billion. This is critical for alleviating poverty, and building security in our region. It is the first step in delivering our long standing commitment to increase Official Development Assistance to 0.5 per cent of Gross National Income by 2015 16.

Mr Swan needs a history lesson. Australia has already agreed to meet a 0.7% of GDP target. Indeed, we were meant to reach that target by 1975 and - of course - we failed. We've failed to meet that committment we made in 1970 on foreign aid for nearly 40 years and it seems now that the long standing goal of the ALP is to continue to fail for another half a decade.

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