You win some, you lose some: The Abbott Government has copped a battering this week.
It hasn’t been the best week for the Federal Government – behind in the opinion polls already and copping plenty of unfriendly headlines. It must be of little comfort to think those headlines were the result of policy that was at least half-right.
For example, moving to ditch the previous Labor’s peculiar wage supplements for a minority of childcare and aged care workers certainly made for bad press – stripping pennies from the lowly-paid while looking after rich mates. That actually is what the government is doing with its superannuation reversals, but it’s not that simple with the child and aged care workers.
The previous policy was dodgy. It was a partial Band-Aid for a select few that didn’t address the bigger problem of low wages in two difficult policy areas. And there’s some truth in the Liberal Party’s allegation that it was designed with union membership numbers in mind. Union membership, especially of the right unions, is a predictable undercurrent of an ACTU-sponsored party.
So it’s not wrong to drop bad policy, but it’s only been half right for two reasons: glaring inconsistencies and the failure to address the bigger issue. That makes the moves smell of the coalition’s abiding hangover from its opposition performance – it’s more about being anti-Labor than pro-Liberal.
It’s reasonable to hope, however naively, for a degree of consistency in government. Thus, if you’re scrapping the wage subsidies, the bad policy of salary packaging fringe benefit tax breaks for employees of charities and hospitals also should go. Instead, the coalition tried to use charity workers’ access to cheaper cars as a reason for maintaining the FBT/novated lease rort.
My suspicion is that the average nurse and charity worker can’t afford to buy a new car every few years – and thus a minority obtain a benefit while the rest effectively subsidise it. An easy test of the integrity of the promised taxation review is whether it recommends reinstating the car FBT reforms the government has just scrapped.
The bigger issue though is what, if anything, the government intends to do about the problem of finding more and quality aged and child care staff at low wage rates. As the government heavily subsidises such care, it has an interest in keeping wages down, but the existing problems in aged care facilities plus the approaching demographic tsunami mean that’s not sustainable. Saying the child care money will instead go to something as nebulous as “professional development” means nothing.
In the absence of sustainable policy then, it’s easy to be left suspecting there will be a push for much greater use of 457 visas, that Australian cities could end up mirroring Hong Kong on Sundays, where there is something ineffably sad about the legions of Filipina and Indonesian maids gathering cheaply on their one day off in parks and footpaths to share stories of home and families.
And then there’s the Holden thing. The government also was right to make obvious that subsidising unprofitable car manufacturing cannot be open ended. At some stage enough, say $2 billion over ten years, is enough.
Too bad it was handled so poorly.
Public threats and dares aren’t a sensible way of handling anything, let alone big business. And leaking damaging and false stories to a Murdoch tabloid is plain stupid. Again, it’s that problem of attack being the coalition’s default setting after the past four years of mad dog opposition.
Most of what can be written about the Holden case has been, but here’s a challenge to the government’s anti-Labor fixation: There’s lots of hot air being spoken about encouraging unspecified “other” manufacturing to replace Holden. A key part of that could be to keep the Clean Energy Finance Corporation chaired by Jillian Broadbent. It’s actually making money – but it was a Labor/Greens initiative.
So what matters most, Tony and Joe, political retribution or the good of the country?
Michael Pascoe is a BusinessDay contributing editor