The Pencil Guy: Hourann's illogical blog

Swimming in the dollars!

So the 2007 episode of The Peter Costello Budget Show has aired, and my first impression is “wow! the spending’s not as irresponsible as I’d expected!”

Not to say that it is responsible, but I can at least detect miniscule grains of sense in pretty much everything that’s been put forward.

Perhaps because of this, Treasurer-man was at pains to tell journalists that he’s delivering “major reforms” — which is of course nonsense. For instance, rather than tax simplification, there’s a $30 billion tax cut aimed squarely at the voters who haven’t been all that well looked-after by Pete and Johnny thus far. Indeed, that’s the theme of this Budget: try to buy out voters who may be swaying from the Howard school of “keep interest rates low” due to traditional Labor concerns like the environment or education.

Universities get a reasonable boost in the form of a “Higher Education Endowment Fund” equating to about $100 million per campus (UWA’s existing endowment is $450ish million), along with promises of new management policies and more funding for Commonwealth scholarships, but this is relatively small change on the back of long-term declines. The story is likewise for vocational training: any extra funding is great, and this Budget delivers, but it falls far short of what is really needed.

There are a bunch of one-off bribes carefully structured so they’ll arrive right before the election, one of which is a doubling of the superannuation co-contribution for payments made last financial year. It must be said that this policy is a mostly good thing and thus worthy of funding, but a one-off top-up? in an election year? could it be any more blatant?!

On health and the environment, the offerings are pretty lame, apart from small policies like a doubling of the solar panel rebate. The documents quote nice big figures, but most of it was announced before and is spread over many years. Then again, who knows what the “real” election campaign will bring?

  1. Well, I guess I don’t OBJECT to a $500 per year tax cut. It’s not going to change my vote, though!

  2. I’d pay $500 MORE tax if it meant a change, ANY change, of government. Bring in the bleedin’ Greens as a majority party, I don’t care… anything!

  3. [...] Fund), Peter Martin (with a focus on Ken Henry’s views of productive capacity) and the Pencil Guy (with a focus on one-off election [...]

Care to leave a comment?