Catallaxy Files

How could you say no to Veticare?

The Tasmanian Parliament has passed a bill (Reproductive Health (Access to Terminations) Bill 2013) which bans free speech within

a radius of 150 metres from premises at which terminations are provided

but could be far further since ‘prohibited behaviour’ includes

a protest in relation to terminations that is able to be seen or heard by a person accessing, or attempting to access, premises at which terminations are provided

A person exercising his or her right to freedom of expression and prosecuted under the bill could be fined up to $65,000 and / or imprisoned for up to 12 months.

This provision could well conflict with section 46 of the Tasmanian Constitution which states:

Freedom of conscience and the free profession and practice of religion are, subject to public order and morality, guaranteed to every citizen.

Now, from the Party that brought you Medicare, DisabilityCare and GonskiCare, the Gillard Government is proud to present its latest reform: Veticare.  Why should dog and cat owners be discriminated against when providing for the care of their loved and loving animals?

Veticare is the new universal scheme that provides:

• full health cover (including dental) for all pet dogs and cats including visits to veterinary surgeons and hospital care (which will include scheduled fees and bulk billing where available)
• paid leave to care for a sick dog or cat (up to three months a year of paid carer’s leave)
• paid leave to care for pregnant dogs and cats.

Working dogs will not be excluded either. They will be paid full sick and maternity (paternity) leave. Why should that hard working border collie or seeing-eye dog miss out on paid leave?

The Labor Party is proud of its affordable and caring programs. It is also justly proud of its sound management of the Australian economy during the most significant economic crisis the world has ever seen.

A new agency – Veticare Australia – will be established to administer the scheme. I have decided to appoint dog lover Kevin Rudd as the first Chief Executive of Veticare Australia.

To fund the new program, a 0.5 percentage point Vetilevy will be added to the Medicare levy. This will take the Medicare Levy to 2.5% from 1 July 2014.

Don’t let Tony Abbott hurt your pets – Vote Labor to get your dose of Veticare. We won’t sell you a pup!

Veticare: comprehensive, affordable and caring.

(HT: NC)

UPDATE: Noodle adds the following

We also need a non means tested Petcare rebate, so that people can be subsidised to put their cats and dogs in kennels when they go away on holidays.

Astounding that it might seem, the possibility of Barry O’Farrell actively and deliberately supporting the Gillard Government in its re-election quest cannot be excluded.

His behaviour and comments over the Gonski ’reforms’ indicate that he has either lost his mind or gone native. Can’t he see the forest (the Australian economy as a whole) from the trees (some ‘promised’ extra money from Canberra)? Does O’Farrell think that a Gillard Government is going to benefit NSW and the O’Farrell administration? Does O’Farrell think that Wayne Swan makes a better Treasurer than Joe Hockey? Can he believe promises of money long into the future? It seems that he does.

O’Farrell’s behaviour shows the importance of getting State revenue and expenditure to be more closely matched so that State Governments will be less in hock to the Federal Government. State governments should be fully responsible for the revenue they raise and the expenditure they decide and the administration of State functions such as education.

If O’Farrell thinks a returned Gillard Government will be helpful to him (as opposed to actively supporting the NSW Labor opposition), he has rocks in his head.

Perhaps it is time for Barry O’Farrell to be replaced in NSW just as Ted Baillieu was in Victoria and Terry Mills in the Northern Territory.

What was the total of Commonwealth Government grants provided last year? Don’t know? Nor do I. You see, there is no consolidated listing of grants – one needs to go through each Commonwealth Government agency and department to sum the grants. A friend in Finance once did this for research grants (not arts grants) and came to $9 billion.

Here is one grant from the Australian National Preventative Health Agency

Tracy Comans, Griffith University $463,442

The cost-effectiveness and consumer acceptability of taxation strategies to reduce rates of overweight and obesity amongst children in Australia

Childhood obesity is a health issue with serious co-morbidities and is increasing in prevalence in Australia. Whilst this issue has been recognised for some time, it is still unclear what the best solution to tackle it is. This research seeks to find the acceptability and cost-effectiveness of taxation of junk foods in halting and reversing the problem of childhood obesity. This study is unique in that it will directly involve consumers in identifying what strategies are likely to be effective and what conditions will be acceptable to the public in the fight against childhood obesity. The challenge of how to effectively gain community perspectives is a crucial consideration in public policy at the moment, and is addressed by this study. To guide the feasibility and successful implementation of effective population based approaches in the prevention of obesity in Australia, it is essential to gather information about how consumers will respond to large scale, yet sensitive, reforms. The information gained from this study will be invaluable to governments in determining the most feasible and publically [sic] acceptable strategies for confronting this issue.

Now the Health Minister Tanya Plibersek has ruled out a ‘fat tax’ saying

We have decided to actively educate and encourage Australians to adopt and maintain a healthy diet rather than to legislate.

I can’t imagine a Coalition Government introducing such a tax, so one wonders about the efficacy for a $0.5 million grant. These types of studies – asking people what they think about a tax – depend on the questions asked and usually are quite leading questions. As Peter Dutton has  said, the grant should be scrapped. Ms Comans must have better things to do than asking people whether they want to pay a fat tax.

More generally, though, I would like a Coalition government to greatly increase the transparency and accountability of government grants. In health, several agencies provide grants: the National Health and Medical Research Council, the Australian National Preventative Health Agency, the Department of Health and Ageing, the Health Communities Initiative, Health Care and Social Assistance grants and others, not to mention also those grants from State governments.

Then we have grants for community, culture and the arts. Grants for the social sciences (including political science) and so forth. And of course those related to climate change.

Personally I think we could slash many of these grants. If anything, government grants have caused a significant decline in the quality of Australian art and literature. Governments grants can’t create a Beethoven or Da Vinci.

But at the very least, we should have a consolidated listing of grants across categories.

It seems to me that the best response to the GST scare campaign by Labor (which is a repeat of Labor’s campaign in 1998 and 2001) include:

• Labor has had six years to repeal the GST. It promised to rollback the GST and has failed to act on that promise. A Labor promise is worthless.
• The will be no change to the GST  - either in rate or coverage – before the next (2016) election. We will commission a broad study of taxation – local, state and federal – which will inform the Coalition’s tax reform policies to take to the 2016 election.
• In principle such reforms could include changes to the GST. Such changes might increase or decrease the GST rate; or narrow or widen the coverage. It might involve leaving the GST unchanged. But whatever policy is decided by a Coalition Government will be clearly articulated to the electorate providing sufficient time for voters to consider the proposals and cast their vote.
• There is a solemn Coalition pledge: taxation will always and everywhere be lower under a Coalition Government than under a Labor Government. We favour less distorting and more efficient taxes. We are committed to reducing waste and the burden of government spending.

This survey is about the Whitlam Government and Blue Poles.

CLICK FOR SURVEY

CLICK FOR RESPONSES

On the Bolt Report today, in responding to questions about the budget deficit, Anthony Albanese (who at least should receive credit for turning up) said at least two things that are false.

• First, that the difference in the write down of $12 billion claimed by the Prime Minister before the budget and the close to $20 billion at budget is due to timing differences (ie: the former is from MYEFO and the latter from budget).
• Second, that the revenue writedown (misforecasting) was due to the ‘high Australian dollar’.

Let’s examine these claims. The reconciliation table for last week’s budget shows a parameter variation of negative $19.936 billion. This comprises $13.7 billion in overestimated revenue and $5.6 billion in underestimated expenditure. Importantly this is the variation since last year’s MYEFO, not last year’s budget. To compare with last year’s budget we would add the parameter variation between that budget and last year’s MYEFO, which is negative $1.7 billion.

I think that they (Gillard and Albanese) confused revenue write down (since MYEFO) of $13.7 billion with the forecast deficit. With Wayne Swan trying to explain things, I can excuse them for making that mistake.

On the second issue, the writedown due to the ‘high Australian dollar’ we only need to look at the exchange rate assumption used at last year’s budget, MYEFO and this year’s budget. In last year’s budget, the assumption used was for a USD exchange rate of 103 cents. For MYEFO it was 102 cents. For this year’s budget it is 103 cents.

Therefore it cannot be the ‘high Australian dollar’ causing the revenue writedown – the same exchange rate assumption was used in last budget as this budget.

More likely it is the carbon tax revenue estimates. Here the Government backcast the price (clearly way too high) to meet the expected abatement objectives. Then that price was used to estimate the revenue the government would receive. That’s why I think it is a bit rich for the Government to claim that the carbon price wasn’t a forecast – it was intrinsic to its economic forecasts.

Peter Costello is right with his analogy. The government can only jump 4 1/2 feet consistently in high jump. In a fit of ambition it ‘forecasts’ that it will jump 6 feet. When the jump is made, it makes 4 2/3 feet. Rather than celebrating the increase in the height jumped compared with the past, it despairs that it jumped 1 1/3 feet less than expected.

Finally in defending the appalling inaccuracy in the forecasts, Albanese stated

 Treasury figures that are done by the same people who did the figures for the Howard Government.

That’s wrong – I know the people who did the forecasting in Treasury under the Howard Government and they have long since left Treasury.

Budget Statement 4 (in Budget Paper 1) has traditionally been a ‘think piece’ by Treasury looking at contemporary economic concerns principally from a macroeconomic perspective, but also microeconomic.

The practice commenced in the 1997-97 budget as Budget Statement 3 (Structural Change: Recent Developments, Benefits and the Role of Policy)

The various topics since have been:

1998-99: The Current Account Deficit: Structural Improvements

1999-00: Economic Policy Reform and Australia’s Recent Economic Performance

2000-01: Maintaining Low Inflation and Strong Growth

2001-02: (Budget Statement 4): A More Productive Australia: Policy and Technology

2002-03: Australia’s Terms of Trade: Stronger and Less Volatile

2003-04: Sustaining Growth in Australia’s Living Standards

2004-05: Maintaining Low Unemployment in Australia

2005-06: Prosperity and Sustainability

2006-07: Australia in the World Economy

2007-08: Australia’s Labour Force Utilisation

2008-09: Boosting Australia’s Productive Capacity: the Role of Infrastructure and Skills

2009-10: Assessing the Sustainability of the Budget

2010-11: Benefiting from our Mineral Resources: Opportunities, Challenges and Policy Settings

2011-12: Opportunities and Challenges of an Economy in Transition

2012-13: Building Resilience through National Saving

A noticeable change occurred from 2009-10. The statements became far more polemics and political documents. Previous statements, including Swan’s first, were in the traditional analytical mould, eschewing partisan politics.

But starting from Swan’s disgraceful attempt to show faster spending growth under the Coalition in the 2008-09 Budget by using the CPI rather than the accepted non-farm deflator to calculate real growth in spending (which failed), Swan has moved to capture BS4 and turn it into a highly partisan and political document (he of course also started to refer to tax increase as ‘savings’.

So, for example, the 2010-11 BS4 was an attack against the mining sector in pushing for the RSPT. And the 2012-13 BS4 was to push for the increase in the superannuation guarantee from 9 to 12 per cent.

But the latest BS4 takes the cake in gutter politics. Titled “Fiscal Policy in the Current Economic Environment” it is an unashamed defence of Swan and attack on Costello and Howard.

There is no sign of humbleness when it comes to forecasting, or admitting any errors in the policy since the 2007 election.

Take for example

Australia is much better placed to achieve the right balance in setting fiscal policy, due to a track record of prudent fiscal policy, robust financial regulation and strong macroeconomic management and performance, in particular during and since the GFC.

…

In hindsight, while Australia’s fiscal position in 2007-08 was clearly strong by international standards, the structural position was less robust than the headline numbers implied as these were based on economic, commodity and financial market conditions that were not sustained and are unlikely to be repeated in the foreseeable future. Tax cuts and new spending, funded by temporary increases in the terms of trade and capital gains, led to deterioration in the structural budget position in the lead-up to the GFC. Moreover, by not allowing budget surpluses to increase significantly as revenues surged, government decisions prior to the GFC meant that interest rates had to be higher than otherwise to control inflation in an economy that was showing signs of over-heating.

…

Policy changes can also affect the tax-to-GDP ratio. One series of policy changes that is
having a particularly large impact on the tax share is the successive large cuts to
personal income tax rates implemented between 2005-06 and 2009-10. The average
personal income tax rate fell from over 23 per cent of taxable income in the early 2000s
to less than 20 per cent in 2009-10 — which meant that the personal income tax system
delivered around 15 per cent less revenue for each dollar of taxable income.
While personal income tax collections as a share of GDP are expected to return to early
2000s levels by the end of the forward estimates period, revenue forgone in the interim
will have been substantial. For example, tax receipts would have been $14 billion
higher in 2012-13 had the average personal tax rate remained at its 2005-06 level,
abstracting from any impacts the tax cuts may have had on the personal income tax
base.

Most of the statement attempts to justify the deficits and stress how important the present government’s efforts to fiscal sustainability have been – including the many ‘savings’ (ie tax increases such as the increase to the medicare levy).

This is a poorly written document with high-school level research and analysis. It will be a pleasure for Joe Hockey as the new Treasurer to order Treasury to write BS4 for the next budget. A title such as

Correcting five years of policy error

might be appropriate.

I won’t be rushing to buy this diatribe by one of Australia’s worst writers. But the title does lend itself to parody.