Jenna Price August 18, 2014
"Ineffectual strategists": Joe Hockey and Mathias Cormann. Photo: Andrew Meares
For months and months, federal government ministers have been banging on about a budget emergency.
Every time Joe Hockey and Mathias Cormann open their mouths you can hear those dull slogans dreamt up by ineffectual strategists.
Debt and deficit disaster.
Budget emergency.
We know that’s what politicians do when they’ve run out of their own ideas. If they had any in the first place.
Of course, now we all know that there is neither a debt and deficit disaster nor a budget emergency. Except for the one of the government’s own making, borne of pigheaded attachment to the trough and icy disdain for the Australian people.
Now, in fact, by the hand of the Abbott government, we have a full-scale budget emergency, 11 months into the new government’s term.
Even one of their own number, Foreign Minister Julie Bishop, has called on her colleagues to make peace with others, to negotiate, to collaborate. She says it’s time. Sadly, if you’ve heard Mathias Cormann on the radio now – he’s using a new little slogan. An adjustment here and an adjustment there.
Adjustments. Like the ones you have from your health professional. Just a little click and push and everything will be right.
Nick Xenophon, independent senator for South Australia, is having none of that. His view of the budget?
“It needs a general anaesthetic and radical surgery . . . a mini budget is the only way to overcome what is intractable opposition.”
Xenophon has been an independent politician for 16 years and in all that time, including six at a federal level, he’s seen politicians blunder.
“I’m surprised as to what a mess they have made of it . . . there are too many own goals.”
Let’s not go over the Prime Minister for Cutting Corners or the Minister for Rich People Who Drive Cars. The Minister for Bigotry. The Minister for Ensuring Girls stick to Teaching and Nursing. The Minister for Science in the Fifties. The Minister for Ensuring Climate Change. The Minister for White Christian Migrants (not that there’s anything wrong with that).
Let’s just look at what the budget, as planned by the Abbott ministry, will do if it gets through.
First, even the tight response from Treasury tells us that we will all lose money. I don’t mind so much – I’m earning a comfortable middle-class income and so is my spouse. My children, at the minute, are independent. So if I lose $517 a year, I doubt I’ll notice.
But, regressively, those who earn less, will be hurt more. Lower-income families will lose $844 a year. That’s one family meal a week. Let’s see Abbott, Hockey and co make that kind of adjustment.
And when the National Centre for Social and Economic Modelling took a long hard look at the budget, the news was even worse. It showed that 1.25 million low- and middle-income families with children will be $3000 a year worse off (but, as with all things Abbott, the rich stay richer, because of the impact of the removal of the carbon tax – if consumers actually do get some kind of price cut).
Ben Phillips, principal research fellow at NATSEM, based at the University of Canberra, says that given more time he could also have modelled the impact of removing access to the dole for thousands of young Australians.
“So, in reality, the numbers will be worse than that . . . what we modelled was a best-case scenario.”
Again, those who are independent of government influence have the most incisive criticisms – this from “Sharing the Budget pain”, a budget response paper by Peter Whiteford and Daniel Nethery, from ANU’s Crawford School of Economics.
“We find that people on benefits do the heaviest lifting. An unemployed 23-year-old loses $47 per week or 18 per cent of their disposable income. An unemployed lone parent with one 8-year-old child loses $54 per week or 12 per cent. Lone parents earning around two-thirds of the average wage lose between 5.6 to 7 per cent of their disposable income. A single-income couple with two school-age children and average earnings loses $82 per week or 6 per cent of their disposable income.”
And the hard work of the Australia Institute underscores who gets punished. Its research shows that the co-payment will discourage the sick from going to the doctor. Pensioners will be hit to the tune of $1.9 billion. Apprentices will see government loans replacing government assistance. We’ll spend $10 billion a year on defence (where there is no real threat) but cut climate change programs.
The winner is business. But where will its customers be? Businesses can’t exist without consumers and consumers will be hurt, are already hurting.
I asked Nick Xenophon which government policies he thought were most likely to be scrapped after negotiations.
He said the Medicare co-payment, the changes to access to unemployment benefits, university fee deregulations, changes to the automotive transformation scheme which he believes would severely affect jobs, increasing the age pension.
He added others. And I asked him whether he thought a reshuffle would help.
“It’s a lemon. If you are still selling a lemon, a new salesman won’t help.”
Adjustments? Surgery. I’d say this budget needs euthanasia. To put us all out of our misery.
