We know that Morrison and O’Dwyer took their riding instructions on imposing higher taxation on superannuants ( to the tune of an additional $6 billion over the forward estimates) from the taxpayer funded Grattan Institute on whose board the wife of the Prime Minister sits. (Call me a dumb blonde, but if that ain’t conflict of interest, I’ll go hee.)
Now we have come to expect the Grattan Institute to recommend higher taxes at every opportunity. But do we expect Morrison and O’Dwyer to take any notice? (Cats, perhaps you shouldn’t answer this.)
But following on from Grattan’s depiction of older people (hey, Daley is approaching that category) as swine with snouts in the trough, he now wants to go further and eliminate what he regards as unjustified tax breaks for older persons all the time failing to acknowledge the objectives of these tax provisions – encourage older people to stay in the workforce and to retain their private health insurance.
These two outcomes save the government many more billions than they cost, but hey, what would the Grattan Institute know – this is book keeping exercise not economic analysis. Its purpose is political, not about promoting good policy.
Mind you, those who have save very little will not be affected; only those who have worked hard and saved for their retirement will be affected. That’s what fairness means in the Grattan’s bizarro world.
The most depressing thing is that Morrison wouldn’t reject the advice out of hand, but I guess he doesn’t want to hurt Lucy’s feelings. But then again Morrison thinks that imposing a 95 per cent tax on the superannuation paid on the behalf of back packers is OK. Houston: we clearly have a problem.
Treasurer Scott Morrison has left open the door to considering a Grattan Institute proposal to curb or scrap three aged-based tax breaks that cost the budget $1 billion a year.
While he emphasised that the government already has a full program of savings measures it’s pushing hard to win Senate approval for, he didn’t reject the Grattan suggestions out of hand.
The institute on Monday called for government to remove a series of three perks it says are unjustified and flow primarily to people who are well off and over 65 at a time when younger households are carrying an ever-growing burden for budget repair.
With the government already cracking down on so-called middle-class entitlement to help repair the budget, the Grattan proposals are aimed at spreading to load to older Australians by bringing them into line with working-age households on lower incomes.
Asked whether the government would consider the ideas, Mr Morrison said his main focus was on ensuring an existing plan to impose savings on superannuation tax concessions that is currently before the parliament is passed.
“The Grattan Institute have speculated on any number of different types of measures that can be considered,” Mr Morrison told reporters in Canberra on Monday.
“There is no shortage of advice or suggestions provided to the government but our priority at the moment is there is already a fiscal consolidation plan before the parliament.
“It’s important the Parliament deals with that business and that business needs to be dealt with over the next fortnight and indeed in the autumn sittings of next year before we bring down the next budget.”
Fair for all
With the government already crunching working-age households by curbing benefits such as family payments and baby bonuses, the institute argues that keeping similar perks for older but very comfortable “taxed-nots” is patently unfair.
It warns that with the population ageing rapidly, government will need to act fast on curbing these breaks or face a growing block of older voters reluctant to help with budget repair.
The Grattan Institute has identified three measures that it says are particularly egregious examples of needless welfare flowing to categories of older people who are living “far from Struggle Street”.
Introduced over the past 20 years, the three measures that should be curbed or scrapped are the seniors and pensioners tax offset, a higher Medicare levy income threshold and private health insurance rebates set at a higher level than for younger workers.
“Essentially this a generation that is putting less into the tin than previous generations and is now taking a lot more out,” Grattan chief executive John Daley said in an interview.