Institute for Private Enterprise » NT Politics

GST Shares, Budget Strategy, NT Royal Cn

Des Moore — Fri, 19 Aug 2016 02:11:30 +0000

Turnbull’s Statement on WA’s Share of GST Revenue

In my Commentary on Tuesday I suggested that Turnbull’s announcement at the WA Liberal Party’s conference held last weekend that each State would now be guaranteed a minimum share of GST revenue was, once again, lacking in any serious analysis or any checking first even with senior ministers, let alone other states. It has subsequently emerged that the new arrangements, the calculation of which has not been stated, are first to be discussed with other states and that it is unclear when they might start (although WA Premier Barnett who has an election next March says he thought it would be this calendar year). The Australian also published an analysis on the assumption that the minimum share would likely be 75% and that WA (now receiving only 30%) might not receive any future benefit from any such arrangement. My letter to the Australian on the issue was published yesterday with four others (see GST Shares).

Turnbull’s Address to CEDA

It has been predicted in some quarters that Turnbull would give a major policy speech prior to the resumption of Parliament on 30 August. He gave what purported to be such an address yesterday (see Turnbull to CEDA) outlining what he described as the Coalition’s economic plan that “will ensure that Australia is more productive, more competitive, more innovative” and indicating that when Parliament resumes the government would introduce an Omnibus Bill that puts together all the Government’s savings measures that we understand from the election campaign the Labor Party is prepared to support”. Turnbull claimed that such savings amount to about $6.5 billion over the next four years, which compares with total estimated budget expenditure of $1,889 billion ie a miniscule reduction of 0.3%. The proposed savings cover a hotch-potch of items (see Budget Savings) and some dispute has already emerged as to whether Labor will accept them even though they had accepted them during the election campaign. The largest saving of about $1bn relates to the funding of the Australian Renewable Energy Agency and this seems to be particularly disputed by Labor. Of the $6.5 bn of savings items listed only about $6 bn require legislation to become effective.

Surprisingly, Turnbull gave no indication of whether he intended to seek further savings in spending or where such savings might even be considered. One would have expected that he would have at least indicated that, given the estimated deficit of $84.6 bn over the next four years, the Coalition intended to seek further savings in future budgets. But while he indicated that “good budget management is a vital component of our economic plan” and “a strategy to get the budget back into balance” is needed, apart from the $6.5 bn “agreed” saving he did not include any reference to possible areas in which the Coalition would also (even) consider reducing spending. Yet total spending is projected to increase by 13% over the next four years and would still then constitute 25.2% of GDP (compared with 25.8% in the current year). Could an actual total reduction ever be considered by a Turnbull government?

Outside the budget, Turnbull’s address to CEDA is also disappointing and largely consists of a repetition of previously stated broad objectives without giving any real indication as to how these might be achieved and with the inclusion of some objectives which are questionable, such as an Australia which has high wages and a generous social welfare safety net. As Judith Sloan suggests in today’s Australian, “the most disappointing aspect of Turnbull’s speech is the reinforcement of the thinness of the government’s economic agenda” (see “Sloan on Budget”). Her conclusion is spot on – “ the government needs to get real about economic management, not just spout slogans”.

Royal Commission on N Territory Treatment of Juvenile Delinquents

A major candidate for a reduction in budget allocations is the ABC, which appears to continue to distort the presentations on issues which it chooses to show on TV. Its new head seems to have made things worse and the only way it can be disciplined is to cut its funding.

The latest example of a serious distortion is its presentation in Four Corners on the Northern Territory’s treatment of juvenile delinquents. In an article published in the Herald Sun on 16 August, former Premier of Victoria, Jeff Kennett, pointed out that although the footage shown was almost six years old, viewers were not told of this, leaving the impression the incidents shown were the fault of the present government (which faces an election early next year) not the Labor government then in office. Nor did it say that the officers involved in taking disciplinary action had been cleared in a court action or why they had taken the action. No mention was made either of the reforms made in the NT prison system since the time at which the incident occurred. Kennett asked whether if the ABC had made an accurate presentation there would have been a Royal Commission appointed.

In this article in today’s Herald Sun, Andrew Bolt takes up from the Kennett article and refers to a letter written to the NT corrections Minister who implemented reforms by the Four Corner’s reporter who produced the program. That letter showed that the ABC knew that he had made extensive reforms and in fact acknowledged “Minister Elferink, this is a significant legacy. It is also your legacy”. Yet none of this was mentioned in the presentation. In fact the ABC presenter of the program, Sarah Ferguson, implied that the NT treatment of juvenile delinquents was similar to the torture inflicted on those at Iraq’s Abu Ghraib jail!

Bolt argues that Elferink was “tricked by the ABC” and that “Prime Minister Malcolm Turnbull was a fool to let the Four Corners report panic him into calling a royal commission only 10 hours later”. An agile PM might now cancel the royal commission and reduce the ABC’s funding.

Outcome in Senate, NT Royal Cn, Rudd, Bank Interest Rates, US Defence Policy, CFMEU Behaviour

Des Moore — Fri, 05 Aug 2016 02:42:17 +0000

Since the election on July 2, Turnbull has continued his record of mistaken decisions as to both substance and process, plus a failure to indicate what substantive policies will be pursued other than the legislation already foreshadowed to restore the Australian Building and Construction Commission and to make unions more accountable under the registered organisation arrangements. But unless the (recounted) loss of Herbet by 37 votes is successfully challenged and another election held there (which seems too risky a venture), he has a majority of only one in the Reps and a deficit of 16 in the Senate.This means that if the two houses sit together he would need 9 votes from cross benchers (who include no less than 4 from One Nation and 3 from Xenophon) to obtain a majority to pass that legislation, which is a possibility but clearly uncertain. It is of some importance to climate change and extremist terrorist policy that One Nation ended up with 4 Senate seats, including one held by a sceptic (Malcolm Roberts) on global warming who is well versed in the data.

The arithmetic indicates the ongoing difficulty of governing over the next three years under a government that has no mandate and is led by a PM who has shown no abilityto lead a party which has a strong group of small government supporters and no capacity to tackle the major policy issues. The possibility of Coalition members crossing the floor is enhanced and under Turnbull the Liberal Party membership may well decline. An indication of such a possibility is provided by the response to Senator Cory Bernardi’s invitation to join a conservative group, which has already attracted 50,000 members and has raised enough money to appoint a spokesperson (Liberal Party membership is said to be about 80,000).

Northern Territory Royal Commission

Turnbull decided to establish a Royal Commission on juvenile detention policy in the NT almost immediately after watching an ABC TV program which purported to show unjustified use of violence by staff to control aggressive Aboriginal juveniles. The program included the portrayal of a youth strapped to a chair and wearing a hood to prevent him spitting (see picture below). It appears Turnbull made this decision without any investigation of the accuracy of the ABC program and without checking on the causes and difficulty of controlling such delinquents. It is by no means clear that violent action is not justified in certain circumstances, such as preventing self harm.

With Attorney General Brandis’s agreement, Turnbull also appointed a Royal Commissioner without checking on a possible conflict of interest (which was pretty clear to almost anyone checking the Commissioner’s record). Fortunately the Commissioner himself decided to resign one day later. But Turnbull then agreed, with Brandis, to appoint two Royal Commissioners of whom one is Aboriginal. This decision appears to have been made in response to complaints (including by Shorten) that without an Aboriginal a decision by a Royal Commissioner would not be accepted by the Aboriginal community. However it was apparent that the appointment has been made despite a prior public statement by the Aboriginal that the NT Government should be sacked. Although he subsequently retracted the statement, it must affect the credibility of the RC report.

Below is an article on this incident by Andrew Bolt, who argues that either Brandis or the Aboriginal must go. My view is that Turnbull has not only botched this decision and should be the one to retract.He saw it as an opportunity to become involved in an issue for which he would be praised. He could have simply asked his relevant Minister (Scullion) to investigate.

Rudd & UN Sec General

Turnbull’s decision not to support the appointment of Rudd as UN Secretary General was warranted even though he might have been a better candidate than the others who are seeking the appointment. The UN should not be regarded as an important body (rather the contrary) and Australia is better placed to be able to readily attack or praise its decisions with a foreigner appointee. That is not to rule out the support of an appointment of a former Opposition leader to an international body: if Rudd had been a more “sober” candidate he could have been “acceptable”.

However, Turnbull’s handling of the Rudd issue appears to have been faulty in having given the impression some time ago that he (Rudd) at least had a chance of being given Australian support.

Bank Interest Rates

Another example of poor performance by Turnbull is his too-quick decision to call on the banks to explain why they have not passed on the full amount of the Reserve Bank’s 25 basis points cut in official rates. Turnbull also ran a different line to that by Treasurer Scott Morrison, who had commented initially that “it’s for the banks to explain, not the government”. There has not necessarily been full pass-ons for some time and the banks quickly responded by pointing out that other costs have not come down. Once the banks had made that point Turnbull changed his position and “ordered” the banks’ executives to appear once a year before the Reps committee on Finance. (See this article from AFR).

Again, Turnbull’s handling of this issue appears to reflect an attempt to present himself as on top of policy matters when in fact he went off half cocked.

US Defence Policy

As Obama suddenly decided that the US would start air strikes against IS in Libya, the Syrian government under Asaad has continued to conduct its air strikes against “rebels” in Aleppo with support from Russia. According to one report 300,000 are now trapped in the Aleppo“city” (or what little of it is left) and Asaad will in effect take over Syria and Russia will have established a secure foothold in the Middle East. The West will have vacated, thanks mainly to Obama’s decision not to involve the US after initially threatening to do so. (See this article on Russia in Mid East). The US should at least conduct air strikes against Assad’s air force.

Meantime, the US has condemned the latest North Korean launch of ballistic missiles, as has Japan. One such missile landed 250km off the Japanese coast (for the first time inside Japan’s EEZ) and N Korea claims it has miniaturized a nuclear warhead for the missile. The US installation of an anti-missile system in S Korea is not scheduled for completion until the end of next year.

CFMEU Behaviour

This is an excellent OpEd article in the AFR by the executive director of the HR Nicholls Society on the Federal Court handling of CFMEU disruption of the site of the Gold Coast Commonwealth Games stadium.