Ideas@TheCentre brings you ammunition for conversations around the table. 3 short articles from CIS researchers emailed every Friday on the issues of the week.
This week’s final budget outcome report for 2017-18 is the best a federal treasurer has been able to present in 10 years, but the success story is qualified.
The government can point to a deficit that’s only a third of the estimate made when the budget was tabled in May 2017. It is the smallest of the long stream of deficits that started in 2008-09. In a budget of $450 billion the deficit of $10 billion is small enough to be characterised as close to balance.
Last year is likely to have been the year of peak debt, with net debt at 18.6 percent of GDP — similar to the previous peak in 1996 — although gross debt is higher, and the highest in 47 years of budget results. This gross debt burden stands as the stark legacy of an era of fiscal laxity.
The budget is close to balance, but it has taken too long to reach this point. Eight years have passed since the peak deficit, compared with the five years it took to reach a similar point in the 1990s episode.
The slow unwinding of the deficit in this episode has been due largely to spending remaining well above the pre-GFC level (even though it shrank as a share of GDP in 2017-18). Not only have governments failed to pursue budget correction vigorously through expenditure savings, there has also been a lot of spending on new programs.
Although tax revenue is still lower than before the GFC, it is lower by a smaller extent than spending is higher. The surprise narrowing of the deficit in 2017-18 owed much to a surge in tax revenue.
Looking ahead, although the budget is likely to improve further, we may have seen most of the improvement already. New spending on programs such as the NDIS and ‘Gonski’ school funding is largely ahead of us. In the shorter term, fiscal discipline is hostage to the political imperatives of vote-buying in the run-up to the election.
All this suggests that if the budget goes into surplus this year or (as planned) next year, it will struggle to remain there.
It’s time to cool off the rising heat about religious freedom.
It has been four months since the report of the Ruddock Expert panel of religious freedom was handed to the then Prime Minster. Given the new PM Scott Morrison’s recent remarks, its release and the government’s response are still a way off. However his stated guarantee to all Australians is that “their religious freedoms will be protected by law if necessary” has caused alarm in some circles; despite nothing being known about what — if anything — is proposed.
Morrison hasn’t helped by some off-the-cuff remarks about children in public schools being able to do Christmas plays, giving the quite misleading impression that this had something to do with religious freedom. As the recent CIS Policy Paper argued, protecting religious freedom is not about guaranteeing any particular religion’s place in our culture.
However, the lack of any actual proposals hasn’t stopped opinion writers weighing in, for example, with the claim that the whole exercise is nothing more than compensation to the hard right for losing the same sex marriage survey. Or that what is proposed is “legislated homophobia” which “only contemplates protection of narrowly defined Christian beliefs.”
Such claims trivialise and misrepresent the issue. Yes, religious freedoms are in general not under immediate threat in this country. But neither are they effectively protected. We need to be open to the possibly of increasing protection of existing rights to religious liberty without winding back any existing legal rights for others.
When a respectful email to your staff encouraging a no vote in the postal plebiscite can still get you an appearance before the Queensland Industrial Relations Commission it is clear all is not quite as fine as it should be in this country.
Prime Minister Scott Morrison’s decision to deal with internal Liberal party bickering ahead of major Indigenous issues is a sign that the recent leadership spill and ongoing bullying allegations are set to claim an increasing number of policy victims.
The Closing the Gap Refresh, the government’s cornerstone review of previously failed strategies to eliminate the vast health, educational and economic disparities between Indigenous and non-Indigenous Australians, appears to be one such policy consigned to the backwaters.
Due to be a major agenda item at the now cancelled COAG meeting in October, the finalisation of new frameworks, targets and indicators for the Refresh will likely not be addressed until December — at least two months behind schedule.
However, there is a significant chance that they may not even be finalised during the next meeting. A whole host of issues, including power prices and public hospital funding, were meant to be discussed in October. Most will now likely be shifted to the December gathering.
With this being the case, it appears that Closing the Gap might fall out of focus. Even if the strategy is discussed, the packed agenda will mean there is limited time available. Given the enormity of the task – 23 preliminary targets have been proposed – many parts of the Closing the Gap review could remain unresolved well into 2019.
If this were the case, it would make for a sombre occasion when the Prime Minister delivers the annual Closing the Gap update in February. Four key target indicators will have expired, with nothing to replace them. This situation will be far from the positive picture the government offered in announcing the review.
Unfortunately, this is the very real side effect of our leaders placing too-great a focus on politicking in place of genuine decision making. While Scott Morrison seeks to address issues around gender, bullying and intimidation in an attempt to shore up his party ahead of the next election, genuine policy issues have fallen by the wayside.
So while politicians continue to quarrel in Canberra, Closing the Gap will remain helplessly dormant. Meanwhile, Indigenous people from Cape York to Kununurra will continue to wait in hope that their problems will eventually get the attention they require.