The Week in Politics
The government and the opposition squared off over inequality this week.
Last week the Opposition Leader delivered a headland speech to the Melbourne Institute’s Applied Economic and Social Research Conference in which he claimed that inequality has reached a 75 year high. He indicated that one of the problems was the tax system and that Labor would soon announce measures that moved in the direction of a single uniform tax system for everyone.
The media and commentators concluded that Labor would change the tax regime that applies to trusts.
The changes are expected to be announced at a NSW Labor conference this weekend. On Thursday Treasurer Scott Morrison gave a speech in Adelaide in which he said that Labor’s inequality argument was based on a myth. “The poorest 20% of households, on average, receive welfare payments and social services worth eight times what they pay in taxes,” he said. “This is the highest ratio in the OECD and about 50% more than the next most targeted country, New Zealand.” The Treasurer cited Productivity Commission analysis which found that 40% of Australian families pay no net tax.
The Treasurer argued in his speech that Labor’s policy is based on the politics of envy: it doesn’t want to grow peoples’ wages; it just wants to drag the top down so that society is more equal. On the other hand Labor argues that inequality is a brake on growth and that policies to overcome it will promote growth. Labor received some support from the Governor of the Reserve Bank, Dr Philip Lowe, when he spoke to an economists’ lunch on Wednesday. He said that inequality had recently risen slightly although it was more pronounced in the 1980s and 90s.
This contradicts analysis by Professor Roger Wilkins of the Melbourne Institute who found a recent 10% decline in inequality.
The political frontlines are now delineated and are likely to remain as they are up until the next election.
From the Gallery
• New One Nation Senator Peter Georgiou started the week in Greece as he put it “flying the flag for the Australian Senate”.During the Senators visit he participated in the World Hellenic Inter-parliamentary Association conference discussing Hellenic Issues and visited the Sounda Bay War Cemetery in Crete to pay respects to fallen ANZAC’s.
•Minister for Foreign Affairs Julie Bishop and Minister for Defence Marise Payne hosted their U.K Ministerial counterparts Foreign Secretary Boris Johnson and Defence Secretary Sir Michael Fallon. During AUKMIN there was a bilateral meeting between the Foreign Minister Bishop and Foreign Secretary Boris Johnson on Wednesday with the offical AUKMIN summit happening on Thursday followed by a joint media conference. Foreign Secretary Boris Johnson also delivered the Lowy Lecture in Sydney on Thursday evening and both Secretaries joined the Prime Minister for discussions.
• The revamped New Zealand High Commission is in operation. The Commission started off with a flag raising ceremony by the New Zealand Defence Force Warrant Officer Gary Clark to start their operations.
• The 2017 Financial Services Council Leaders Summit was held in Sydney from Tuesday to Wednesday at the International Convention Centre.The event was hosted by FSC CEO Sally Loane and heard from high profile guests the Future Fund chairman and former Australian Treasurer Peter Costello, Former Prime Minister of New Zealand Sir John Key, Shadow Treasurer Chris Bowen who has attended the forum for 10 years and Minister for Revenue and Financial Services Kelly O’Dwyer.
• Dr Gordon de Brouwer PSM advised the PM on Tuesday that he wishes to leave the position as Secretary of the Department of the Environment and Energy on the 8th of September 2017 to pursue other interests. The resignation was unexpected and the Prime Minster said he will announce a new Secretary in due course.
• The Samoan High Commission was officially opened at a ceremony in Canberra on Tuesday. The offical opening of the complex was presided over by H.E Mr. Tuilaepa Aiono Sailele Malielegaoi the Prime Minster of Samoa. The opening also celebrated 40 years of diplomatic relations between Australia and Samoa. The ceremony was attended by the Minister for International Development and the Pacific Senator Concetta Fierravanti-Wells.