Another week in which the BludgerTrack aggregate has essentially shrugged its shoulders in response to a headline-grabbing opinion poll surprise, in this case the narrow 51-49 lead recorded for Labor by Newspoll. With Roy Morgan and Essential Research both going fairly solidly the other way, the Coalition records a gain of only 0.3% on two-party preferred, yielding a dividend of one seat in Western Australia on the seat projection. The Coalition and Labor are both up on the primary vote at the expense of the minor parties, with Palmer United notably hitting a record low in the wake of Glenn Lazarus’s resignation. Interestingly enough, both Labor’s two-party vote and seat projection are exactly as they were at the 2007 election.
Newspoll provided a new set of numbers for the leadership ratings, and as usual the trend reading is highly responsive to the latest seat of results. That means another improvement for Tony Abbott’s net approval rating, which is now back to what had previously been his career-worst result before the Prince Philip knighthood. Bill Shorten is down too, and it’s now clear that the change in dynamics after the Liberal leadership spill vote has taken a bite out of his approval rating. On preferred prime minister, Tony Abbott is now rating very slightly better than he was prior to Australia Day. Full results on the sidebar, further down from the very similar looking display for the New South Wales state election.
http://www.macrobusiness.com.au/2015/03/finally-super-concession-rort-gun/
are we expecting an Essential today?
calling 53-47
trand @2449:
I think Abbott actually believes that there are jobs out there, if only the shiftless dole-bludgers would look for them. The reality (that if every job opening were filled tomorrow, 80% of unemployed people would still be unemployed) means nothing to him.
You have to remember that he’s been insulated from the realities of the job market for most of his adult life: the last time he had to compete for a job was in 1988, to become a concrete plant manager.
He lasted less than two years before being plucked up by his political connections to act as Hewson’s press secretary, then got parachuted into an ultra-safe Liberal seat, where he’s stayed ever since.
Tony Abbott knows nothing about what people needing work face; all he has to inform him is his ideology, which is worse than nothing at all.
Added to that, he’s a bully, a thug, a liar and quite possibly (given his demonstrated lack of concern for others both in the abstract and when he faces them) a sociopath.
briefly @2451:
After seeing how the word’s been prostituted out, I’m leery of anything called “reform” until I get to see the details.
Betty Churcher was a great Australian. RIP
On our cricket team, they are a superb team but would be better liked and more respected if they weren’t such ugly winners and losers. They have no class. They are the Real Madrid of the cricket world. 😀
Matt
And so say all of us.
I should add they are the Real Madrid under Mourinho, not Ancellotti who is a decent guy.
briefly@2451: Terrific! A bunch of politicians and senior public servants who mostly have wonderful, untouched superannuation nest eggs courtesy of defined-benefit schemes are poised to make the crappy accumulation schemes that younger Australians are forced to use even more inadequate.
We are talking the sorts of super arrangements that Jay Weatherill was railing against for SA parliamentarians as being so inadequate as to provide a disincentive against people standing for Parliament.
Yes, get the over-60s to pay a bit of tax: I reckon 15 cents in the dollar is fine. And perhaps scrap the stupid system of annual reasonable benefit levels (currently $30k for under-50s and $35k for over-50s) and go back to an absolute reasonable benefit level per person.
But it would be an intergenerational inequity to leave the annual limit system in place and then crunch the limits down further: as some lefty commentators (who are probably all members of defined-benefit schemes) are calling for. That would be particularly harsh on some people, eg women – especially single mothers – who have come into the workforce in their 40s and 50s who are trying to save as much as they can for retirement in an accumulation scheme. These women are often schoolteachers or nurses on reasonable incomes but who have bugger all superannuation saved because they didn’t work while their children were young. And there are other people who have lost much of their super in divorce settlements or who have not been able to save much when younger, etc, etc.
I reckon a fair system for taxing super in accumulation schemes would be to have an absolute accumulation limit per person beyond which full marginal tax rates would apply – say something between $1 and 2 million seems appropriate – and also an annual limit with a sliding tax scale: eg, 15 cents in the dollar for the first $20k per annum, 30 cents for the next $20k (and maybe for $10k more if you are over-50), and the top marginal rate payable beyond that. It would keep the subsidies down, but still help people who are approaching retirement age and need to save something.
And then I will risk incurring the wrath of those Poll Bludgers who will be affected (despite their being ostensibly far to the left of me) and suggest a tax free threshold for all withdrawals from super funds/super pensions for over-60s of $50k per annum, with 15 cents in the dollar payable over that and 30 cents payable above a $100k threshold (and perhaps more at higher thresholds still, although this will affect a minimum number of people).
As I recall it (I’m not 100% sure of the details), one flaw in the Labor proposal that was scrapped by Abbott was that the tax on withdrawals only applied to funds with more than $2 million in them. It should apply to a withdrawal from a fund of any size, as a disincentive against lump sum payments.
Personally i can afford to pay more tax on my super.
Matt
it’s like Joe’s endless ‘if only women would work, productivity would improve’ — ignoring the fact that women can find it very difficult to re enter the workforce if they’ve taken time off for family.
Or the ‘instead of retiring, keep working if you want to’ – which is a slap in the face for anyone over fifty who is desperately looking for work and can’t get it.
Lots of nominally ‘retired’ people would be quite happy to work.
I was chatting to a friend of mine a day or so ago. He’s a winemaker, which means that from around February to the end of March he works up to 20 hours days, with no days off full stop. Understandably, as he’s getting older, he’d like to slow down. He’s eminently qualified (a former electronic engineer, now a qualified wine maker) but he can’t even get an interview.
Pollies chatting as if work’s out there, all you need to do is rock up and ask for it, insults everyone who is out there looking for a job and can’t even get a nibble.
http://www.crikey.com.au/2015/03/31/essential-what-voters-want-on-tax-reform/
meher baba – given that we haven’t seen the actual detail of any side’s proposed changes for super perhaps we should wait and see what makes it out of the negotiations before jumping the gun on railing against what might or might not be in the package.
As for your suggestions – super in general has managed to become so complicated that I simply cannot follow all the ins and outs of the system anymore, but what you suggest sounds mostly reasonable to me (acknowledging the fact that I can’t seem to focus on how super actually works/should work).
From what Bowen was saying on 7.30 last night there does seem to be a consensus around properly establishing exactly what the aims of the super system are and then properly targeting the tax treatment to ensure it is doing what we have agreed we want it to do.
trand@2452
Well done.
The super system needs to be tilted so it advantages accumulation by low-middle income earners while they are able to work. This will add to the pool of savings available to support retirement incomes. That is the main purpose of providing a tax shelter for savings.
I agree the annual limits are self-defeating and should be replaced by an aggregate cap. On the other hand there’s no reason that tax rates should be related to age. They should be indexed to income, no matter the age of the taxpayer.
mb @ 1458
I’m on a defined benefit scheme and I’m about to get an extra taxation benefit courtesy of John Howard just for surviving until the age of 60. I’m happy to take it, but I cannot see any justification for the policy.
As for what should be done, the problem is that the objectives of Government support for superannuation are unclear. I cannot comment on the specifics of your proposals, because there are great complexities (loopholes opening and closing) with any proposal. But I can comment on the general principle.
And the only principle that I can see should apply is that the whole superannuation system should be designed around maximising the number of people who have sufficient superannuation savings to be not dependent on a welfare pension on retiring from the workforce.
And the further one’s super savings and current income get from that objective, the more any incentives to put money into superannuation should be wound back.
One thing that is absolutely outrageous, it seems to me, is that someone with spare income above the top marginal bracket who puts $10,000 into superannuation saves at least 15c in the dollar more than someone on average income putting the same amount into superannuation. Same problem with negative gearing, where the biggest financial advantage (and revenue foregone) goes to those with the highest marginal income and the most disposable income to save, invest or spend. Ironically, this group is the most disadvantaged when it comes to saving, given that bank deposits are taxed at full marginal rate.
It seems to me that the first step in a taxation shake-up should be to convert tax deductions to fixed value rebates for a number of areas. Obviously, not where the deduction relates directly to earned income, or where there is a clear public interest (such as donations to charity) in encouraging people on higher incomes to incur the deductions.
But, really, there is absolutely no public interest in some of the tax arrangements that are directed nominally at those saving for a moderate lifestyle in retirement most advantage those who are aiming to maximise a glamorous lifestyle in retirement.
Good to see potential for bi-partisanship on the need to improve the super system, one thing which I would like to see come out of this process besides re-balancing the system, would be for an agreement to refrain form any further changes to Super for a period of five years or so.
Sounds to me like the voters are giving a big tick to most of what Labor is proposing. The Liberals have got some very big problems coming up policy wise I would say.
Darn
That doesn’t surprise me, we do seem to get bogged down on the GST, when as you point out there are other areas in need of looking at.
On the earlier discussion about Iron Ore and the actions of BHP and RIO hurting the budget, the government could do one of two things, either reinstate the mining tax or increase the corporations tax on the mining sector.
TPOF@2465: As applied to superannuation, the idea of fixed value concessional rates seems fine to me: say a flat 15 cents off your top marginal tax rate up to a $50k per year limit or some such.
What we don’t want is to kill off all the incentives in the tax system to invest in equities such as super funds. Because, if that happens, you know that high income earners are just going to go out and borrow more money and do more negative gearing. And if that loophole is going to be closed off as well, they are going to set up their own private companies and trusts and god knows what.
When people have lots of surplus income subject to the top marginal tax rate, they are going to try to save/invest it in ways that reduce their tax burden. I cannot imagine that a tax system can possibly be devised that would eliminate this opportunity entirely without creating all sorts of undesirable consequences.
If high income earners were given a flat 15 cents in the dollar – or even perhaps a 10 cents in the dollar – tax benefit for investing in superannuation up to a reasonably high amount, many of them would choose that simple option over negative gearing and all sorts of other investment strategies. This would mean that a lot more tax is collected from these people than is currently the case, and also that their savings would be more secure than they would be in many of the dodgy tax effective investment schemes (including negatively-geared property: not everybody makes a motza on that).
Maybe there’s something wrong with my logic here, but it seems to me to be a good half a loaf approach.
But I’m worried that they might go the other way and impose an unduly harsh tax burden on people in accumulation schemes. As has been pointed out by others, most of the decision-makers in this process own negatively-geared assets. And the majority of them (both politicians and public servants) are also in defined benefit super schemes.
Well, just when you thought that things couldn’t get sillier the Fifteenth Annual Weblog Awards come out.
To give you some idea of their credibility, note the winner for Best Australian or New Zealand Weblog.
The Pickering Post.
Call me cynical but i suspect that there was a bit or organised encouragement for the local RWNJobbies to vote early and often.
For Zoomster, the knowall, from Crikey:
“NSA doesn’t want phone records. While Australia’s major parties have embraced mass surveillance, the evidence continues to accumulate that it’s useless at preventing terrorism or solving crime. As we’ve explained until we’re blue in the face, we know from Germany, Denmark, the USA and the Netherlands that various forms of data retention (involving, in some cases, even more extensive data collection than Australians will be subject to) don’t help security agencies do the job they profess to do of protecting the public. Moreover, as we saw in the Charlie Hebdo attack, France’s extensive mass surveillance laws did nothing to prevent attacks by terrorists already well known to authorities. But now comes possibly the best evidence of the pointlessness of data retention of all — from the National Security Agency itself. America’s PBS yesterday revealed that key figures within the NSA planned to advise the then-head of the NSA that data retention of phone records should be scrapped. NSA staff were concerned not merely that the program of storing fixed line phone data was illegal — not something that overly concerns the NSA, admittedly — but that the benefits were meagre. This was the same conclusion reached two years earlier when the NSA had decided to stop collecting email metadata — that the expense of collecting it was unjustified by the benefits. Phone and email metadata will both be collected under Australia’s mass surveillance scheme. It’s one thing to adopt stupid, draconian policies. It’s quite another to do so after it’s become obvious from overseas experience that they don’t work.”
Expensive, ineffective stupidity. Backed by our ALP.
I know, nobody has shown you any evidence against it. That you are actually prepared to read and absorb. None so blind as those that refuse to see!
Briefly@2464: I understand that the reason that the concessional tax rates are related to age rather than income is with the aim of helping people like those I mentioned before: women who entered the workforce later in life and have high incomes now, but haven’t accumulated much superannuation earlier in their lives.
Why is this not a legitimate policy objective?
If we base the limits on taxable income, a lot of these women would miss out, but a lot of much wealthier people who are able to reduce their income through investments would also be able to put more into super. “Taxable income” is a very poor indicator of total wealth: apparently most of the people on the BRW rich list have an annual taxable income that is less than the dole.
There was an idea a while back about having a higher concessional limit for people whose total superannuation assets were less than a certain amount. But I am told it would be an administrative nightmare for various reasons that I could go into if anyone really wants to know.
A solid and highly readable article by Ben Bernanke on the setting of interest rates by the US Fed. I commend it to the Bludgers:
http://www.brookings.edu/blogs/ben-bernanke/posts/2015/03/30-why-interest-rates-so-low
Essential Fed Poll: TPP ALP 53 (-1) L/NP 47 (-1)
Primaries ALP 40(-1) L/NP 40(0) GRN 10(0) PUP 1(0) OTH 9(+1)
http://essentialvision.com.au/documents/essential_report_150331.pdf
Note the supplementary questions on Economics, Finance, and if Abbott will still be PM in 2016.
Is there a link to the latest Essential?
Doh!!!
I see that Leroy has just posted the link. At ease everyone. As you were.
Wow, yabba, timing.
It took you THAT long to come up with something?
mb @ 2469
I totally agree and I’m certainly not advocating a purist approach. The problem is that the current set of incentives are no longer fit for purpose. Every tax benefit or concession changes behaviour. And the interaction of existing benefits, concessions and charges with changes in society or other imposts also changes behaviour.
I don’t think the Howard changes were ever good -I recall that even at the time economists were warning of structural problems in the years to come and now all those chickens have come home to roost. Negative gearing is more complex. Opponents fail to recognise that sufficient investment in property is necessary to ensure that there is a well-balanced rental market for those who are not in a position to buy or who are transient. In the past NG and the CGT discount has been reasonably effective at achieving this outcome, but the current design is clearly failing now, especially in the largest cities.
As for super concessions generally – I go back to my previous comments that the first objective is to ensure that the design is focussed on ensuring that as many people as possible have an objectively fair income in retirement that negates the need to rely on welfare. Above that people can, and do, look after themselves.
Bombers drugs bust ends in whitewash.
Zoomster, you dill, that quote appeared in my inbox 5 minutes ago. Provide a rebuttal, or a justification for your opinion. Anything rather than your usual feeble, utterly meaningless abuse! And the spooks pushing for more power and money is not a justification, its just their reason for wasting more of our money on them, and on making ISPs carry out pointless and expensive non-work.
Nauruan kids have to go to Nauruan school Lizzie that’s how it works.
They don’t get to go to Australian schools.
If they don’t like the school on Nauru they can always go to Cambodia
But not Malaysia cos that would make Joe cry
He didn’t close the school in Nauru, please stop making stuff up.
He is closing the Nauru detention centre classes because the place is close to being empty. Isn’t that a wonderful thing? Soon we will be back to the Howard days in 2007 when there were a grand total of 4 people in detention, not the 30,000 Labor left us with.
Pyne’s ed reforms dead as a doornail. Complete fail.
It now enjoys no support whatsoever in the sector.
http://www.smh.com.au/federal-politics/political-news/group-of-8-withdraws-support-for-further-compromise-on-university-deregulation-20150331-1mbjwy.html
Malaysia is not a Refugee Signatory country.
Apparantly this was very important for Gillard at the 2010 election that she only send people to a Refugee Signatory country. You remember that one right?
Would expect ASADA to appeal – if so bombers to remain firmly under a cloud! Couldn’t have happened to a nicer bunch.
Does the appeal venue have wider powers of compulsion (there were from memory very very relevant witnesses who didn’t voluntarily appear and couldn’t be compelled
He’s fixed it, see?
Liberals opened Nauru detention centre in 2001? Nauru signed refugee convention in 2011? Bit rich of the Libs to cry about refugee conventions.
Bit rich for Gillard to cry about not sending people to a non-refugee signatory country at the 2010 election and then immediately after the election try and send people to the only non-signatory in the region.
Anywhere but Nauru. Anywhere but Manus. That’s all that Gillard cared about. It was all spin, she’d have sent them to a craggy outcrop if it meant avoiding admitting the Pacific Solution worked.
Shame the punters weren’t fooled.
Gillard should have picked up the phone to the president of Nauru the day they announced they would sign up for the refugee convention if she had any real morals.
paap @ 2482
😀
paap @ 2482
Don’t get trolled by potato head’s monkey.
Children’s situation in Cambodia http://resourcecentre.savethechildren.se/start/countries/cambodia
2471
Yabba88
There it is. It just doesn’t work. What more fatal a flaw can it have?
We are handing an extraordinary power to our overlords, just oozing the potential for serious abuse, for no good reason, and during the reign of King Tony.
Why?
Not happy, Labor. You are going to have to revisit this one before too long.
🙁
Yabba
I guess you won’t see the irony there.
Adults in Malaysia can be caned for breaking the law = Liberal tears.
Children in Cambodia can be caned for displeasing teacher = Libs want to send children there.
A final post from me on the taxation system generally.
Obviously the main aim of the taxation system is to raise enough money to undertake the functions of government, as determined by the elected government of the time. If the policy of that government is directed towards redistribution of wealth through the welfare system or other means, then the taxation system needs to take account of that, but I don’t think that redistribution of wealth should be seen as a goal of the taxation system per se. (I suspect that puts me to the right of many public commentators and posters on here.)
And that’s where the concept of a “progressive” taxation system has never made much sense to me. I certainly think that we should raise more money for undertaking the functions of government from those who can afford to pay more. But what we have had throughout my lifetime is a system in which PAYE taxpayers are asked to pay an escalating amount of their income in tax as their income increases, but then there are an incredible number of ways in which they can “opt out” of actually paying those punitive amounts: negative gearing, family trusts, setting up private companies, superannuation, etc, etc.
In our modern globalised economy and with the wide availability of cheap loans, the avenues for “opting out” of higher marginal tax rates are so multifarious and easy to access that, in the average water cooler discussion, those taxpayers who actually pay the higher rates are made to feel like complete mugs.
This doesn’t seem like a good system to me. I would have thought that a flatter tax scale, with far fewer options to “opt out” would be far more equitable. I would also have thought that a higher take through GST – which is largely unavoidable – and a reduced take through income tax for lower income earners plus adequate welfare compensation – would be a fairer arrangement. As I heard Labor yesterday, they were completely ruling out any consideration of extending the GST to cover private school fees and private health costs, but couching this in terms of an argument that this would be a “regressive” form of taxation. What a complete crock of BS!
The opting out arrangements would be much targeted towards socially- and economically-beneficial investments and away from artificial tax minimisation arrangements and, perhaps, negatively-geared existing properties (I still remain to be totally convinced about that idea). There should be a particular crack-down on family trusts and private businesses that are not making a convincing effort to engage in commercial activity, particularly where the main revenue of the company is an income payed in relation to the services of an individual. (To be fair, Treasury and the ATO have made efforts to crack down on the most egregious cases of this form of tax minimisation, but there is a lot more to be done).
If we have a higher GST and far fewer opportunities for PAYE earners to minimise tax other than through straight-out investment in super up to a limit, you can have flatter tax scales. Perhaps we could have a flat amount all the way up to $200k or so. This flat rate could be as low as 15 cents in the dollar if we really closed off opportunities for people to “opt out” of paying it. We could also move towards replacing the tax free threshold with some sort of “negative income tax” arrangement targeting tax free status at those on the lowest incomes.
Obviously my vision won’t appeal all that much to the remaining fervent apostles of a Robin Hood-style “progressive taxation”
system, whose most extreme manifestations have been found in various European countries which have had top marginal tax rates of 90% or more which virtually nobody actually paid.
Some sort of flat rate system of the type I have put forward (I don’t pretend to be enough of an expert to have designed it properly) seems to me to be much fairer than the system we have now, in which those who have access to the worst (or most scrupulous) lawyers, accountants and financial advisers are the biggest losers.
despite my comment @ 2491 potato head’s monkey did get me thinking about how perverted its values are and the party it supports.
According to the monkey and the Coalition, it is so much better to be raped or forced to sell your body for basics on Nauru, because Nauru is a party to the Refugee’s Convention, than it is to get guaranteed work and freedom in Malaysia, because it isn’t.
Not to mention how lucky Berati was to be beaten to death in Convention party PNG rather than having to risk falling foul of the law in convention non-party Malaysia and possibly beaten with a cane after legal proceedings were completed. If he were still alive I bet Berati would be so grateful to the Coalition he would freely take part in advertisements paid by us extolling the virtues of Operation Sovereign Borders. Maybe the guy who only lost an eye could front up for the ads.
As someone who does support offshore processing and the need to stop uncontrolled unauthorised arrivals of asylum seekers, nothing disgusted me more at a moral level than Abbott and Morrison’s opposition to the Malaysian people swap. I disagree with the Greens position on this, but at least they were honourably consistent.
But Abbott and Morrison actively condemned more people to die, not to mention being raped and beaten and traumatised, while pretending to be concerned about their welfare.
I doubt if I’ll ever let go of my disgust and the moral corruption of Abbott on this matter.
What a farce. Three years of headlines, getting kicked out of the finals, suspensions and court cases and it’s not guilty.
Essendon should take the AFL to the cleaners in compensation or ASADA should appeal. Absolute joke.
Of course…I agree the system needs to work around capped accumulation limits.
ABC report on Queensland:
http://www.abc.net.au/news/2015-03-31/speaker-peter-wellington-lashes-out-over-billy-gordon-furor/6361480
Some interesting points. First, Wellington’s clear fury at how he is being treated by the conservatives means they now have no chance of forming government even if the Katter boys support them:
Secondly, I never fail to be amazed about how much Liberals seem to know for certain what happens in the ALP but never coughs up the evidence:
And finally there is no end to the extent that LNP will talk out of both sides of their mouths at the same time:
Looks like it could be the same compassion and support that Mal Brough and co offered James Ashby.