Progressive ideas

The Abbott Government has broken its promise not to cut hospital funding by slashing funding for Westmead Hospital by $100 million.

Treasurer Joe Hockey also slashed $12 million in funding for St George Hospital, $10 million in funding for Nepean Hospital and $6 million for a new MRI at Mount Druitt Hospital.

The $100m for Westmead Hospital was funding the first stage of redeveloping Westmead Hospital. The total redevelopment would include

a new six or seven story ‘stack’ to consolidate the complex and critical care unit;

  • an expansion of outpatient and ambulatory care;
  • refurbishment of existing infrastructure; and
  • the repositioning of the front of the hospital.

Tony Abbott’s broken promise will hurt families who rely on Westmead Hospital and the critical services it provides.

Before the election, Tony Abbott promised not to cut hospital funding – now he has cut $100 million from Westmead Hospital and other hospitals in Sydney.

These health initiatives were axed by the Abbott Government on Tuesday:

In yesterday’s MYEFO, the Abbott Government confirms the funding cut on page 104.

At a public meeting in Penrith last night, Western Sydney residents have expressed alarm at Barry O’Farrell’s decision to dump 5000 tonnes of radioactive waste at Kemps Creek – a stunning breach of his promise before the 2011 election.

“Barry O’Farrell is ploughing ahead with taking radioactive dirt from Hunters Hill and dumping it on the people of Western Sydney,” Shadow Environment Minister Luke Foley said today.

This is a broken promise of epic proportions.  Mr O’Farrell assured the community that this transfer would never happen – yet tonight he dispatched his bureaucrats as the fall guys for his broken promise.

  • “To dump it in Western Sydney is stupid, it’s a threat, and it’s not the way any government ought to be behaving.” Barry O’Farrell, October 2010

Last month, the O’Farrell Government issued its Final Environmental Assessment for the waste transfer – confirming local residents’ worst fears:

  • “During the proposed Remediation Works, there exists the potential for some groups of people to receive an increase in radiation exposure.” (page 124, 8.1 Radiological Hazards)
  •  ”The half-lives of the radionuclides present in the impacted soils at the site are long, and radioactivity may not attenuate for hundreds of years. As a consequence, any waste management solution would need to be effective in the very long term.” (page 148)
  •  ”In the short term there would be some environmental impacts which would require mitigation [including] …risk of ingestion/exposure to contaminated material containing radioactive tailings and chemical compounds.” (page 233)

“The Premier’s own experts have confirmed that this soil is so toxic it will need to be monitored for radioactive decay until at least the 24th century AD.  Mr O’Farrell is condemning the people of Western Sydney to 300 years of risk from radioactive material sitting within metres from streets and homes. This decision says it all about Barry O’Farrell’s real attitude to Western Sydney.”

Penrith Labor councillor Prue Car said: “Barry O’Farrell is putting the local community last. The Government can hold public meetings until it is blue in the face – the blunt truth is Mr O’Farrell misled us.
“If this soil isn’t dangerous why not keep it in Hunters Hill?  ”If it is dangerous – none of us in Western Sydney want a bar of it.”

 


A new report from the Grattan Institute’s Energy program, Putting the customer back in front: how to make electricity cheaper, presents a concrete set of proposals for substantially reducing the power bills of Australian households.

The main problem driving excessively high prices for consumers is that the regulation of electricity distribution networks is broken. Changes over recent years to the way distributors operate and charge customers have allowed them to make unduly high profits, given the relatively low level of risk they face.

Governments have also intervened to ensure that distributors deliver power at a level of reliability no serious cost-benefit analysis can justify.  Again, it is consumers who pay. To restore the balance, governments should:

  • Direct and empower the Australian Energy Regulator (AER) to set the parameters that determine customer costs and company profits, and ensure that the parameters are consistent with the low risks these businesses face.
  • Reduce the risk of political interference by transferring responsibility for setting reliability standards from state governments to the Australian Energy Market Commission (AEMC) and the AER, the national bodies that set and enforce the rules of the market.
  • Implement more robust corporate governance standards for government-owned businesses to ensure they operate as efficiently as those that are privately owned. Otherwise they should be privatized.
  • Prevent over-investment in the networks by empowering the AER to review the companies’ capital expenditure forecasts annually against credible market demand forecasts, and subject any over-expenditure to a rigorous cost-benefit analysis.

Recent rule changes proposed by the AEMC are going in the right direction, but are still too general to instill confidence that the desired result will be delivered.

Of course distribution companies should be allowed to make fair and reasonable profits. At the same time, regulators should not only have more resources and power – but should be directed – to act in the long-term interests of consumers.

The Report states the recommendations in this report could save customers about $2.2 billion a year, or $100 a year for every household, as well as creating a fairer, more efficient electricity distribution system.

Since taking office in March 2011, Barry O’Farrell and his Government have made a number of cuts to funding, jobs, workers’ rights and services. Here is an overview of what the workers of NSW have endured thus far.


Attacks on Workers’ Rights

Taken Control of IRC and Frozen Wages

-                   The Government passed the Industrial Relations (Public Sector Conditions of Employment) Act 2011. Consequently the Government has given itself complete power to determine wage increases (or not) and conditions for public sector staff through Regulations which do not have to pass any votes in the Parliament.

-                   The Industrial Relations Commission has had its power to arbitrate wage disputes removed.

-                   So far, the Government has frozen wage increases for public sector workers at 2.5%. Whilst the O’Farrell Government has claimed this will not leave public sector workers worse off, the University of Sydney’s Workplace Research Centre found that a nurse would be $12, 232 worse off and a teacher $14, 580 worse off each year had the O’Farrell policy been applied over the past decade.

Attacked Injured Workers

-                   Government amendments to the Workers Compensation Act saw significant cuts to the support and compensation provided to injured workers.

-                   The cuts to Workers Compensation means weekly payments will cease after 2.5 years and medical costs will stop being paid after 3.5 years for most injured workers.

-                   Additionally, workers will have almost non-existent coverage for accidents on their way to or from work.

-                   No lump sum payments can be made for pain and suffering, regardless of the severity of the injury.

-                   Changes to weekly benefits, medical costs and duration of payments are to apply as soon as possible to existing claims.

-                   The O’Farrell government attributed the needs for the cuts to a ‘deficit’ in WorkCover. The cuts have shifted the blame of the ‘deficit’ onto injured workers, with the Government hoping for a reduction in insurance premiums for employers.

 

Stripped Police of their Death and Disability Protection

-                   The Government’s Police Amendment (Death and Disability) Act 2011 severely cut the support and rehabilitation provided to police who are injured on the job, as well as support for families of police officers killed at work.

Attacked Workers’ Rights to Fairly Bargain Collectively

-                   Currently before Parliament is the Government’s Industrial Relations Amendment (Dispute Orders) Bill 2012. If this Bill is passed, it will increase fines for taking industrial action from $10,000 a day to $110,000 a day.

-                   It is also important to remember as mentioned above that unions no longer have the right to independent arbitration over wages and conditions and unlike the Federal industrial relations system have no legal right to strike through protected action.

No Consultation around Significant Industrial Changes

-                   By way of example The Technical and Further Education Commission Amendment (Staff Employment) Act 2011 saw 13,000 TAFE teachers transferred to the Federal industrial relations system where they now fall under the Fair Work Act

-                   No consultations with unions or teachers were attempted prior to the introduction and subsequent passing of this Act.

-                   Similarly, Government abolished the Transport Appeals Board with no discussion with unions.

Forcing Retail Workers to Work on Public Holidays

-                   The Retail Trading Amendment Bill 2012 presented by the O’Farrell Government will allow all retailers to trade on Boxing Day and Easter Sunday which will see employees being forced to work on what should be a day for families.

-                   The Bill will also lead to backroom staff and staff of retail businesses working on Christmas Day and Good Friday.

 No Support for Equal Pay

-                   The most recent State budget has not allocated any funding to equal pay for social and community sector workers in line with the recent Fair Work findings.

-                   There are 30,000 community and public sector workers in NSW. Without NSW funding these workers will not receive the awarded increases in full which range from 19 – 41 per cent.

-                   Prior to the election O’Farrell promised social and community sector workers a fair and equitable pay rise.

Slashing Public Sector Entitlements

-                   The O’Farrell Government has applied to the NSW Industrial Relations Commission to change 98 different Public Sector Awards and enact massive cuts to entitlements and benefit.

-                   Some of the cuts include: slashing annual leave loading, cutting penalty rates for shift workers, removal of additional sick leave entitlements and parental leave.

by Miranda Stewart

In January 2013, Mr Chris Jordan AO starts as Federal Commissioner of Taxation in charge of the Australian Taxation Office (ATO). He follows Mr Michael D’Ascenzo AO, who was not reappointed after his seven-year term.

Mr Jordan will be only the 12th Commissioner and only the second external appointment in the ATO’s history. All appointments have been male. The first Commissioner, George McKay, appointed from the New South Wales public service in 1910, seems to have died from overwork in 1917 after administering on a shoestring the federal land tax and income tax introduced in 1915 to help fund World War I. The next Commissioner, Robert Ewing, appointed an assistant commissioner to help. In his 22 year innings until 1939, Mr Ewing oversaw a new federal estate tax, payroll tax, and the turbulent time before World War II, when the federal government took over the income taxes of the States.

Mr Jordan is a former chairman of KPMG and company director. His appointment has been widely welcomed especially by business and professional groups. He has been on the Board of Taxation since its establishment in 2000 and was appointed chairman in June 2011. His early working life as a policeman may also stand him in good stead.

So what are the challenges facing Mr Jordan in his new appointment?

Today, the ATO is an organisation of 25,000 people that collected net tax of $273 billion in 2010-11. Mr Jordan will be responsible for the income tax, GST, fringe benefits tax, petroleum and mineral resource rent taxes, medicare levy, fuel taxes and higher education levies. The ATO also administers parts of the superannuation system, child support, the Australian Business Register and Valuation Office.

The ATO is under constant pressure to increase revenue collection. Most revenue is collected through its highly effective income tax and GST withholding systems. These ensure electronic transfers from taxpayers to government coffers throughout the year. The ATO manages these systems at a remarkably low administrative cost of a little under $3.5 billion a year, a cost to revenue ratio of about 1 per cent. This does not include compliance costs of taxpayers and business and we know that these are significantly higher than direct governmental costs of tax collection, and regressive in their impact.

Mr Jordan’s main responsibility – and biggest challenge – is to keep this efficient organisation running well. He will have to manage his staff so that sick days are kept to a minimum and make sure the next computer roll-out stays on budget. He has lost one valuable support in this task, as Jennie Grainger, former Second Commissioner in charge of Compliance, has just taken up an appointment in Her Majesty’s Revenue and Customs in the UK. Several other leading ATO staff are also retiring, including senior legal experts.

Some have suggested that Mr Jordan can – and should – lead a change in ATO culture, presumably to make it more business and taxpayer-friendly. One commentator, for example, suggests that he will better understand the plight of small business.

It is true that the ATO has a strong organisational culture. Being the subject of widespread popular dislike will do that. ATO staff also understand their importance to government. Still, caution is needed: that strong culture contributes to the morale of ATO staff, and that helps keep the revenue rolling in.

Mr Jordan has demonstrated his effectiveness in liaison with government and business. He will no doubt strengthen the work begun by Mr D’Ascenzo in engaging with taxpayers and the tax profession about most aspects of administration and interpretation of tax law.

But it is important that the Commissioner of Taxation is – and is perceived to be – absolutely independent both of the government of the day, and of undue professional or business tax influence.

Mr Jordan faces the challenge of handling revenue collection in relation to high wealth individuals, including investigations into international tax evasion started under Mr D’Ascenzo. He must oversee controversial large corporate audits that challenge cross-border transfer pricing activity and tax planning. He becomes Commissioner in an era of unprecedented and expanding inter-governmental tax cooperation.

Mr Jordan will be in charge of new risk-based audit, settlements, and real-time information disclosure arrangements with large business. UK Secretary of Taxation Mr Dave Hartnett was at the forefront of these developments. He recently retired amid public controversy that he took “enhanced relationships” with big business too far. Within limits, a prickly relationship between business, the profession and the Commissioner is probably healthy. It won’t be Mr Jordan’s job to be liked.

What of Mr Jordan’s role in tax reform? That is only a small fraction of the job. In 2002, Treasurer Peter Costello moved the tax legislation function into Treasury. Mr Jordan will keep his seat on the Board of Taxation, but only as an ex officio member. He may be able to strengthen the voice of the core administrator in Treasury’s tax law reform processes. That would be a good thing. But his main job is to keep that revenue – about $750 million per day – rolling in to fund government to do what the public wants it to do.

Miranda Stewart is a Professor at Melbourne Law School, University of Melbourne.

This article was first published at www.theconversation.edu.au

 


Progressing the Social Democratic Agenda