Labor’s dodgy plan to spend billions it doesn’t have

April 29, 2019

It was only a matter of time before Labor announced its plans to spray around the extra tax revenue it expects to reel in as result of its multitude of additional tax imposts.

The Conservative Party strongly opposes the swag of Bill Shorten’s already-promised tax rises for businesses and individuals and rule-changes for retirees’ savings and will vote to block them in the Senate. That’s why you need to vote “1” Australian Conservatives on your white Senate ballot paper.

An opinion piece in today’s The Australian warns: the additional revenue is not in the bag, both because some of the measures may never pass the Senate and the inherent uncertainty of Labor’s revenue projections.

Who can forget Wayne Swan’s assumptions about the revenue that was going to be achieved from the mining tax, revenue that was spent several times over?

In the end the mining tax actually cost the government more than any revenue received.

It was always odds-on that Labor would commit more to childcare subsidies as well as directly fund higher wages for childcare workers.

Actually, there was an attempt by Labor’s former hapless childcare minister, Kate Ellis, in the dying days of the previous Labor government, to boost the wages of some childcare workers, but it was so badly executed it’s not clear what happened to the money.

There is no reason to think Labor’s extra $4 billion in childcare subsidies over four years will result in a different outcome, given the history of the commonwealth government’s involvement in childcare.

The end result will be higher fees, with the gains mainly snaffled by centre owners. 

All that stuff from Labor about the Australian Competition & Consumer Commission getting involved won’t really do anything.

The commonwealth will outlay $8.3 billion in childcare subsidies in 2019-20. According to the budget papers, the outlay for childcare subsidies will rise to $9.6 billion in 2022-23. This is the figure before the turbocharging proposed by Labor.

The commonwealth also has control of regulation of the sector, with costly and difficult to justify impositions in relation to staff-to-child ratios, the qualifications of staff and the quality of the childcare centre premises. As for Labor’s proposal to increase the wages of childcare workers — these costs make up the majority of centre costs — by an average of $11,500 a year over an eight-year period, how are other workers delivering human services going to react?

There will be a lot of hands up for this same deal. This is surely another instance of Labor trying to usurp the role of the Fair Work Commission in setting minimum award wages and conditions of workers.

Childcare is a beautiful industry for centre owners, including the large corporate groups. With the government picking up most of the tab for parents, there is really nothing much that can go wrong. And over-regulation of the sector plays into the hands of bigger operators while forcing out the smaller ones.

Labor’s electoral pitch is based on offering more free stuff, using other people’s money, and ignoring the unintended consequences.

Expect further announcements of more free stuff.

To read Judith Sloan’s full article, click here.

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NO B.S.

NO B.S. Bring Back Common Sense to Australia - we must block Bill Shorten's plans to destroy jobs, bankrupt the economy, unleash political correctness and reward Labor's political comrades. Add your name if you agree.
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