Search This Blog

Saturday, May 5, 2012

Labor reality versus Liberal hyperbole

We are constantly told that the federal Australian Labor Party is 'on the nose' with the electorate. Certainly comments in the media, letters to the editor and even just general conversation with people would indicate that. Ask them why and of course they will trot out the usual criticisms, such as the BER, pink batts, boat arrivals, the deficit, carbon tax, mineral resource rent tax.

Yet is Labor as bad as they say? Labor has actually achieved a good deal for Australia. Labor's biggest problem is their self-marketing and their public infighting, coupled with the Liberal Party's exaggerated claims of doom and gloom.

Labor needs to start promoting themselves and explaining their achievements.  If the Liberal hyperbole is to be believed, Australia is on the brink of economic collapse, wallowing in debt and illegal immigrants. Yet the truth is far removed from the fear-mongering as can be seen in the following brief summary of Labor achievements:
  • Responsible deficit management.  In the 2012 budget, Treasurer Wayne Swan delivered a budget that will return Australia to surplus by $1.5 billion and build on that surplus of the next four consecutive years.  This surplus follows the deficit that Labor accrued as they rolled out policies that protected Australia during the GFC.  Having said that, is a surplus really necessary? Surpluses are over-rated, yet the opposition has convinced the Australian public that deficits are bad. Under Howard, Australia had a massive surplus which essentially saw minimal funding on infrastructure and key services.  The Australian deficit is manageable and needs to be balanced against the benefit that has been obtained from maintaining and improving infrastructure, services and the economy. Nonetheless, the strength of the Australian economy is such that it is now the time to take the country back into surplus and that is what Wayne Swan's responsible 2012 budget is forecast to do.
  • Economic strength. In May 2012 Australia's economic growth was close to average, while unemployment and inflation were still quite low. On 26 July 2012, Australia's inflation was at its lowest level in 13 years. 
    Additionally, Australia's cost of living was the lowest it has been in 20 years. Australia is one of eight countries which still has a AAA credit rating.
    The biggest threat to both growth and employment is consumer confidence.  A lot of this has been fuelled by negativity and fear-mongering by the federal opposition.
    Given the strength of the Australian economy, consumer confidence should be higher than it is and it is a rise in this confidence which will increase growth and employment, particularly in non-mining sectors such as retail, hospitality, tourism and manufacturing. Additionally, if consumer confidence wasn't being sabotaged by the opposition, we would also see growth in the residential real estate market.  Consumer confidence is being eroded by forces other than the true picture of the economy.
    The high Australian dollar is impacting on the economy (positively or negatively, depending on whether your importing or exporting), yet this is the trade-off for a strong economy in comparison to the collapses in other western currencies, particularly the US dollar.
  • NDIS/NAIS. Labor introduced the National Disability Insurance Scheme and National Accident Insurance Scheme to benefit people born with disabilities and those who are disabled through accidents.
  • Sustainability
    • Carbon tax. Labor introduced a carbon tax to encourage businesses to reduce their unsustainable reliance on fossil fuels and to develop and move to renewable energy sources. The coalition has fuelled fears that this tax will massively increase the cost of almost everything, yet as it is aimed at the top 500 companies (out of 3 million companies in Australia), the biggest threat is some businesses will take advantage of this alarmism and increase prices independently of the tax, that essentially they will price gouge even though the tax may have little impact on them.
    • Renewable energy programs. Labor has implemented other initiatives to assist in moving towards renewable energy sources, such as solar panels for households and schools. Labor invested $5.1 million in renewable energy, including solar, wind, geothermal and biofuels research. Regardless of whether or not you believe in man-made climate change, the fact is that our reliance on fossil fuels is unsustainable and pollutes the planet. 
    • Home Energy Saver Scheme. Labor introduced the Home Energy Saver Scheme to deliver energy efficiency services to around 100,000 low income families.
    • Mining resources rent tax. Labor introduced a mining resource rent tax to ensure that all Australians benefit from the mining of minerals and not just the mining companies. Minerals belong to the Crown, so why shouldn't the mining companies pay for them?
  • National Broadband Network. Labor introduced the National Broadband Network, an ambitious project which will future-proof Australia's communication network rather than reliance on 20th century technology.
  • Health. 
    • Labor increased health spending by 50%
    • increased training places for GPs and nurses
    • upgraded emergency rooms 
    • targeted teen dental health 
    • implemented health checks for 4 year olds.  
    • They also invested over $2.3 billion on cancer research and treatment centres, including the construction of two cancer research facilities in Sydney and Melbourne and established a network of cancer centres across regional Australia.  
    • Labor has increased funding of community mental health facilities. 
  • Aged care
    • 2012/13 budget includes $3.7 billion to reform aged care. 
    • Home care packages have increased by 60%, taking them to 100,000. Home care packages are a group of services that assist the elderly to continue living in their own homes and communities)
    • Aged pension increases. Labor has introduced the single biggest increase to aged pensions in 100 years, with more than $100 per fortnight for singles and $76 per fortnight for couples.
    • increased aged care places by 10,000.
  • Education and Training
    • National Workforce Development Fund which funds industry to support training and work-force development in areas of current and future need, particularly in relation to apprentices and mature age workers.
    • Training places. Labor has created 235,000 new training places to develop workplace skills and increase productivity, enabling more people to not just obtain a job, but have a career.
    • Trade Training in Schools Program. Labor delivered a key 2007 election promise through the Trade Training in Schools Program, which builds trade training centres in schools.  This program encourages students to stay in school longer as well as prepares them for trade-related careers.
    • Single National School Curriculum. Labor established the Single National School Curriculum in order to standardise english, maths, science and history curriculum throughout the country.
    • Laptops in schools. Labor delivered new laptops to all students throughout Australia in years 9 to 12.
    • Education Tax Refund has assisted families with educational costs such as laptops, software and text books.
    • School-kids bonus to assist parents to meet the cost of their children's education
  • Businesses
    • loss carry back - which allows businesses to carry back tax losses so that they receive refunds in subsequent years. This supports once profitable businesses to profit through a tax benefit of up to $300,000.
  • Tax cuts. 
    • The last three budgets delivered tax cuts to working families and low income earners. 
      • someone earning $30,000 p.a. pays $750 less tax than in 2007/8 (26% decrease in tax)
      • someone earning $50,000 p.a. pays $1,750 less tax than in 2007/8 (18% decrease)
      • someone earning $80,000 p.a. pays $1,550 less tax than in 2007/8 (8% decrease)
    • Supplementary allowance introduced for those on low incomes, including students, the unemployed and parents with young children. 
  • Tax free threshold. The tax free threshold has been tripled from $6,000 to $18,000 which presents significant tax benefits for people earning up to $80,000.
  • Infrastructure. 
    • Labor significantly increased spending on infrastructure such as roads, ports and rail networks.  For instance, 'Roads to Recovery' funded the upgrade of local, state, territory and federal roads, duplicating the Pacific Highway and funding of the Torrens and Goodwill rail projects.
  • Global Financial Crisis. 
    • Labor successfully navigated Australia through the Global Financial Crisis, arguably the biggest economic collapse since the Great Depression.  Australia was one of the few western nations which survived relatively unscathed and it was because of the nation-building stimulus packages which included the pink batts scheme, jobs stimulus programs, programs for health and education, small business tax breaks, and cash bonuses for every taxpayer.
    • An RBA report indicated that Labor's efforts during the GFC had saved up to 500,000 Australian jobs. Additionally, Labor guaranteed bank deposits which ensure that our banks maintained their strength and stability, while our savings remained protected.
    • ALP programs protected Australians from the most serious effects of the GFC, earning Wayne Swan the accolade of 'World's Greatest Treasure' by the respectable 'Euromoney' magazine.
    • Critics often raise the BER and pink batts as evidence of ineptitude, yet the BER was the responsibility of state education departments and a report found that the majority of projects benefited the school communities and were delivered within a realistic budget. The pink batts scheme had tragic consequences when unlicensed contractors took advantage of the grants, proving the need for greater government intervention of business activities through more rigid licensing and compliance audits.
  • Industrial Relations reform. 
    • Fair Work Australia. Labor over-turned the Liberals WorkChoices legislation and phasing out the Australian Workplace Agreements which had cost jobs, security and benefits in many sectors, most noticeably retail and hospitality.  Labor undertook the daunting task of standardising the industrial awards in Australia through the implementation of Fair Work Australia and reinstating unfair dismissal laws.
  • Federal-state relations. Labor committed to a more equitable distribution of federal-state funding which was in contrast to Howard's often devisive approach to federal-state relationships.
  • Same-sex relationships. Labor passed laws to recognise same-sex relationships in key areas including employment, superannuation, taxation and health.
  • The Apology. Kevin Rudd apologised to indigenous Australian's for the abuse that they suffered at the hands of previous Australian governments.
  • Kyoto. Kevin Rudd signed the Kyoto Protocol, committing Australia to reducing its emissions.
Australia may be the lucky country, but this 'luck' doesn't happen by chance. It happens through the concerted effort of government to maintain a strong and sustainable economy - this is what Labor has achieved.

Article updated 8 May 2012 following the federal budget announcement:

No comments:

Post a Comment