The main game

Like many, it broke my heart when Labor lost the Federal election in 2019. There were so many bold policies that spoke to me about what should be at the core of the Labor project, not least the redistributive tax policies regarding negative gearing and dividend imputation. 

I worry, as Labor looks to 2022, that we will move away from policies that call out, and try to fix, the fundamental injustices in our society. Surely that’s what Labor must always try to do. 

The scale of this work at times feels overwhelming. So much injustice. So little time. We need to focus on guaranteeing the basics: somewhere to live, personal safety, enough food, clothing, transportation, education, healthcare and work. These basics are elusive for far too many. 

As it looks to 2022, Labor needs to devise policies that focus on delivering these basics for everyone. 

Policies like calling for massive investment in social and affordable housing. It may sound ABC TV Utopian’ but the investment needed is of a nation-building scale. That investment should come from both public and private spheres facilitated by funding models such as government housing bonds and utilising the vast resources of the superannuation sector. The bonus from such a scheme, in addition to curbing homelessness that is on the rise – especially among older women – would be to boost construction jobs and stimulate the economy. 

We need policies that create greater safety for women, by increasing investment in the supports that allow women to leave abusive relationships like shelters, community legal centres and domestic violence leave. We also need to invest in the policy levers that will change gender dynamics. Women are being killed, and the violence directed at them has its roots in the gender inequity in our society. We need “use it or lose it” parental leave, so caring roles become genuinely equal. We need improved access to long day care. We need to target direct and indirect sex discrimination in everything from pay to sport to boardrooms to school uniforms and more.

We need policies that ensure people can afford food, clothing and transportation. That means increasing social security and pegging it to a proportion of the minimum wage. It means changing our industrial relations system so everyone who works gets a reliable job that delivers a living wage. Our industrial relations system is too narrowly cast around the concept of an “employee” and needs to be recast to provide protections for all workers including compensation for working unsociable hours and the other standard features of our industrial relations system won by generations of unionists.

We need policies to equalise our education system. Parents who choose to send their children to elite private schools have no right to expect any government funding for that school. End of story. The argument that the contribution the government would have otherwise made to educate that child should somehow flow to that elite private school is ludicrous and not consistent with the way we approach other decisions people make freely, such as not smoking (all those saved health dollars), or being law abiding (all that money saved from the criminal justice system). These dollars should be invested in our public education system, particularly in our lower socioeconomic neighbourhoods.

We need policies to truly deliver on the promise of Medicare. That means access to doctors that bulk bill, ready access to necessary medication, free hospital care when needed (including to promote quality of life as well as saving life) and a free dental service for all. While our public health system is good, too many diagnostic tests require substantial co-payments, wait lists are way too long and preventative healthcare is not commonplace. Instead of funding private health insurance, we should invest in the public health system. It’s that simple. Two-tier health care for those with means will always be a reality, but it shouldn’t be subsidised by the government. Just like funding elite private schools with dollars “saved” from the public education system, funding people’s choice to bypass the public health system is not sound policy. Lift the standards of healthcare (and education) for the masses and let those with means create their own self-funded path.

We need policies to create quality jobs. Jobs with a future. Jobs in renewable energy and battery production for example, jobs in mining to dig up the minerals those industries need. We need well-paid and respected caring jobs for our children and elderly, and not insignificantly, jobs in industries that supply our National, State and Territory Governments, which should proudly buy local.

Finally, while some of these policy shifts will actually go a long way to paying for themselves, we need to reform our broken tax system. We know the system is broken because our first world country can no longer deliver the basics to everyone who lives here. 

Every change to the tax system in recent years has been piecemeal: the GST; the Medicare levy; the election-focussed tax cuts; the foreshadowed reduction in tax brackets; tax free super and so on. The OECD tax principles – neutrality, efficiency, certainty, simplicity, effectiveness, fairness and flexibility are strangers to Australia’s tax system. 

The system is not neutral when it favours various methods of self employment (through extensive availability of deductions and income splitting) over traditional employment relationships. 

The system is not efficient when compliance costs are exorbitant for businesses and people alike. 

The system is not certain or simple given the complexity that drives aggressive tax minimisation with staggering losses to revenue. 

The system is not effective or fair because it doesn’t generate enough revenue to fund essential government services and it doesn’t avoid double taxation or unintentional non-payment of tax. Pay as you go taxpayers live with double taxation every day when they pay GST to purchase goods and services with income on which they’ve already paid tax, when they pay stamp duty to buy a house from income on which they’ve already paid tax.  And one in five of Australia’s largest companies pay no tax at all. 

The system is not flexible. It allows people to exploit avoidance loopholes but does not have the reactive capability to promptly cauterise these leakages. 

We need to redesign the tax system from scratch around the principle that everyone pays their fair share.

We need the tax system to be right, now more than ever, because fiscal policy is the only policy lever of government that actually seems to work at the moment. Monetary policy may make a come back, but for now, it’s a dead dog.

There are so many important policy areas I haven’t touched and I hope people will be kind when they rightly call them out. But surely if we focus on getting the basics right, the other stuff will follow.