Aid an investment, not discretionary charity

By Canberra Times
Updated April 23 2018 - 10:36pm, first published July 6 2014 - 7:25pm

Harold Macmillan once famously criticised a successor British Tory prime minister over the privatisation of public assets for selling the family silver to pay for the grocery bill. He was not, as some seem to think, criticising policies of returning to private ownership that which had been controlled by state capitalism. He was objecting to a tendency to regard the money coming back from such sales as income, able to be spent on the ordinary outgoings of government rather than to retire public debt. Australian governments typically, but certainly Coalition ones, have not usually made that mistake. They have self-consciously used the proceeds of asset sales either to retire public debt, or, in certain cases, to create capital funds for particular purposes, including future superannuation liabilities, funds for university capital expansion and for medical research. Each is well capable of being described as an investment for future generations of Australians. This is good policy. Over recent months, Prime Minister Tony Abbott has repeatedly referred to the former Labor government raising debt on the national credit card, and of the problems caused for ordinary operations of government when one has to find a billion dollars a month in regular payments, as it were, on that credit card.

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