Malcolm Turnbull has raised the prospect of personal income tax relief to help middle-income earners, saying he is “actively working” on it.
As the government is still trying without success to get the remaining part of its company tax plan through parliament, which would deliver lower tax to big companies, Turnbull has moved to hold out the prospect of relief for individuals.
Speaking to the Business Council of Australia on Monday night, he noted the government had already lifted the second-highest income tax bracket threshold from A$80,000 to A$87,000, keeping some half-a-million people from moving into a higher bracket. It had also spared people facing a permanent top marginal rate of 49.5% by not making the temporary deficit levy permanent.
“You know our plans on corporate tax,” he said. “In the personal income tax space, I am actively working with the treasurer and all my cabinet colleagues to ease the burden on middle-income Australians, while also meeting our commitment to return the budget to surplus.”
He said his commitment to all Australians was: “Whether you are starting out in your first job, a worker providing for their family, or a business hiring staff, our goal is always to leave more money in your pocket, not in ours.
“Higher taxes penalise people who are trying to get ahead. But when you reward hard work and enterprise, you encourage hard work and enterprise.
“It’s pretty simple – more investment, more jobs. That’s the key.”
He recalled that his earliest foray into the personal income tax debate in 2005 as a fairly new MP was not uniformly welcomed. He did not spell out that then-treasurer Peter Costello was furious.
But the concerns that underpinned a report he released then still existed: “The tax system remains complex and compliance is a burden, our marginal tax rates are high, bracket creep is a constant challenge that needs to be addressed”.
Turnbull said that “just because we’re in challenging fiscal times doesn’t mean we should raise the white flag on making the tax system work better”.
A Treasury analysis showed Australia risked being left behind by the rest of the world in the competitiveness of its business tax, he said, citing in particular the US and the UK.
“If we don’t reduce our corporate rate to 25% as planned – in our Enterprise Tax Plan – over the coming decade, the only advanced nations that will exceed Australia’s tax rate are Japan and Malta.”
Malcolm Turnbull’s tactic of cancelling the House of Representatives’ sitting next week – because his numbers are depleted and the government is nervous – is a short-sighted decision that smacks of lack of nerve.
Undoubtedly it would have been a rough week in the lower house. But refusing to face it looks panicky, just when Turnbull is trying to convince people that he and the government are in control.
The government is desperate to keep the lower house agenda narrow and as tightly managed as its unfortunate circumstances permit. It declares the rest of the parliamentary year will be confined to legislating for same-sex marriage and considering which citizenship cases should be referred to the High Court.
Monday’s cancellation wasn’t Turnbull’s only ploy to avoid being embarrassed in the lower house’s final sitting days of 2017. When he recently met Bill Shorten to discuss citizenship disclosure, he tried to win agreement to confine the coming period to non-controversial legislation. Labor naturally wouldn’t play ball.
The cancellation has nothing logically to do with the timetable for the same-sex marriage bill. Consideration of that legislation was always to continue in the Senate next week, moving to the House of Representatives for debate the week after. Meanwhile, the lower house next week would have dealt with other legislation.
Nor is Leader of the House Christopher Pyne convincing when he claims this is just a routine change, and that there was no need for the lower house to meet next week because there was nothing urgent for it to do.
In truth, the government fears what trouble Labor games and rebels in its own ranks might cause, and is desperate to limit the time available to them. The latter, spearheaded by Nationals Barry O’Sullivan in the Senate and George Christensen in the lower house, are planning to try to force the issue of a commission of inquiry into the banks and other financial institutions.
O’Sullivan is preparing a bill for the banking commission and claims up to four lower house members could cross the floor. The O’Sullivan commission would report to the parliament; it would be distinct from a royal commission, which only the government can set up.
This bill was never going to get to the lower house next week; it’s not even clear whether it will be debated there when the lower house does sit the week starting December 4. But Christensen says he will vote for a commission or the like “in whatever guise it comes up and I definitely expect it’s going to come up”. Something will certainly “come up” if Labor can make it do so.
One big question is why the government has let this bank issue fester. It has been very critical of the banks, slapped a hefty tax on them, and moved to impose a tough regimen on their executives. But it has fought trenchantly against the royal commission that Labor advocates.
Given the strength of anti-bank feeling in the community, and within some of its own ranks – based on the banks’ bad behaviour – the government should have long ago cut its losses and set up a broad-ranging inquiry.
An important aspect of the rebel Nationals’ push is that they are referencing the precedent of the Liberals rebels’ success on same-sex marriage.
O’Sullivan told the ABC the government’s facilitating Liberal backbencher Dean Smith’s private member’s bill (now a crossbench bill) provided “a new pathway for backbenchers to be able to pursue matters of importance to them, and I’m just simply following along in his footsteps”.
The Nationals remain deeply out of sorts about the marriage debate sucking oxygen, as they see it, from other issues for months.
Beyond that, the rebels have taken from the marriage story the lesson that what’s good for the goose should be good for the gander. If a group of Liberal rebels – the “famous five” who put same sex-marriage back on the government agenda – can break ranks and end up getting what they want, why not a group of Nationals, with their issues?
And the win – and praise – scored by the Liberal rebels has meant the Nationals leadership and whips have reduced authority to keep their own rebels in line.
On Monday night Labor was seeking crossbench support for a proposed joint letter to put pressure on Turnbull to reverse his decision to cancel next week’s lower house sittings, but there’s no chance of his doing that.
Turnbull had raised the possibility of deferring the start of the House sitting at his meeting with Shorten. Shorten gave it short shrift at the time, and said so publicly, but Turnbull has rashly chosen to have the last word.
Turnbull told a business audience on Monday night: “In times of uncertainty, the nation needs calm and measured leadership, a steady hand at the helm”. His earlier action suggested a touch of the tremble.
The Queensland election will be held in five days, on November 25. There has been no statewide polling from either Galaxy or Newspoll since an early November Galaxy. These two pollsters have given Labor higher primary votes than ReachTEL, and assume One Nation preferences will not favour the LNP as strongly as ReachTEL, which uses respondent-allocated preferences. As a result, Labor has led by about 52-48 in Galaxy and Newspoll, while they have been behind 52-48 in ReachTEL.
A Queensland ReachTEL poll for the parent advocacy group The Parenthood, which was conducted on November 13 from a sample of 1,130, gave the LNP a 52-48 lead by respondent preferences. This is unchanged from a late September media-commissioned ReachTEL. Primary votes were 32.7% Labor (down 2.1), 32.2% LNP (down 1.0), 17.7% One Nation (down 1.9) and 9.5% Greens (up 1.4).
A second ReachTEL poll, for the left-wing Australia Institute, which was also conducted on November 13 from a sample of almost 2,200, gave the LNP a 52-48 lead from primary votes of 34.0% Labor, 32.3% LNP, 17.9% One Nation and 8.3% Greens.
These two polls show One Nation in decline since the September ReachTEL, but this decline has gone to “Others” instead of the major parties.
Despite being a little behind Labor on primary votes, the LNP leads by 52-48 in both polls. Respondent preferences from non-major party voters flowed to the LNP over Labor at a 56-59% rate. If Greens preferences are going to Labor at a 75% rate, preferences of One Nation and Other voters are favouring the LNP at a near 70% rate.
At the March Western Australian election, One Nation preferences flowed to the Liberals at a 60% rate, according to the ABC’s Antony Green. In that case, there was a preference deal between One Nation and the Liberals, whereas in Queensland One Nation is putting most sitting members second last ahead of the Greens, irrespective of party.
If ReachTEL’s strong preferences from One Nation to the LNP occur at the Queensland election, it would be bad news not just for state Labor, but also federal Labor. Most federal polls assume One Nation preferences split evenly, as they did in 2016.
In an additional poll question released November 18, presumably from the early November Galaxy, voters opposed the proposed A$1 billion Commonwealth loan for Adani by a 55-28 margin.
Newspoll conducted six seat polls on November 15-16 from samples of 500-700 per seat. The seats surveyed were Mansfield, Whitsunday, Gaven, Ipswich West, Bundaberg and Thuringowa. There was a large swing against Labor in Thuringowa, with One Nation leading 54-46. In Bundaberg, the LNP led by 53-47, after Labor won by 0.5% in 2015.
In the other seats, Labor’s vote was holding up better, with small swings to Labor in Whitsunday, Mansfield and Gaven. A ReachTEL poll in Maiwar for GetUp! had a 50-50 tie, a three-point swing to Labor.
According to Kevin Bonham, the average of 11 Galaxy/Newspoll seat polls in Labor vs LNP contests is a 0.9 point swing to the LNP. However, seat polling has not been accurate in past elections.
Where the election will be won or lost
After being reduced to just seven seats at the 2012 election, Labor won 44 of the 89 seats at the 2015 election, forming government with the support of independent Peter Wellington. For most of the last term, Labor relied on the support of Labor defector Billy Gordon, who had won Cook. Labor’s Cairns MP Rob Pyne also defected in 2016.
After a redistribution, there will be 93 seats at this election. From the ABC’s pendulum, Labor would win 47 seats on 2015 results, the LNP 41, the Katter party 2 and there would be three defectors – two from Labor and one LNP. If the defectors are assigned to the party that would win the seat on 2015 results, Labor has 48 seats and the LNP 43. Labor can afford to lose one net seat without losing its majority.
At this election, One Nation’s vote is likely to be in the high teens, and they will do better in regional Queensland than in south-east Queensland. Galaxy seat polling indicates that regional Queensland is swinging against Labor, but polls of Glass House and Bonney, both in southeast Queensland, recorded small swings to Labor.
Labor is likely to have trouble holding regional seats such as Bundaberg (Labor by 0.5%), Maryborough (1.1%), Burdekin (1.4%) and Mundingburra (1.8%). The question is whether they can make up for any losses in regional Queensland by winning south-east Queensland seats such as Everton (LNP by 2.0%), Bonney (2.2%), Maiwar (3.0%) and Aspley (3.2%).
Labor could gain these LNP-held southeastern seats on a backlash against the LNP’s preference recommendations favouring One Nation in 50 of the 61 seats it is contesting. The last time One Nation was a force was at the 1998 and 2001 elections, before the LNP was formed. In 1998, the Liberals lost five seats, all to Labor, to fall to nine. In 2001, the Liberals were reduced to just three seats.
Galaxy and Newspoll seat polls have only shown One Nation winning Thuringowa, and in contention to win Logan, but the LNP’s how-to-vote cards are favouring Labor in Logan. Pauline Hanson almost won Lockyer at the 2015 election, so it is a prime target for One Nation. In 1998, One Nation won 11 seats on 22.7% of the statewide vote, but current polling has them well short of 1998, and they are unlikely to win more than a few seats.
Greens gain Vic seat of Northcote from Labor at byelection
A byelection in the Victorian seat of Northcote was held on the weekend, due to the death of Labor incumbent Fiona Richardson. The Greens’ Lidia Thorpe defeated Labor’s Clare Burns by a thumping 55.6-44.4 margin, a swing of 11.7 points to the Greens since the 2014 state election. Primary votes were 45.3% Greens (up 9.0) and 35.4% Labor (down 5.6). The Liberals did not contest, and the Liberal Democrats won only 4.1%, well below the 16.5% the Liberals had won in 2014.
Labor put in a strong effort to retain Northcote, yet they were still thrashed, losing a seat they had held at every election since it was created in 1927. The inner-Melbourne seats are trending towards the Greens, and Labor should probably focus their resources on the conservative parties, rather than spend money in seats that are likely to be lost anyway.
A ReachTEL poll, conducted for the CFMEU on November 9, had a 54-46 Labor lead – a large miss. This is not the first time ReachTEL has grossly underestimated the Greens in an inner city seat. At the 2015 NSW state election, ReachTEL gave Labor a 56.5-43.5 lead in Newtown, which the Greens won by a crushing 59.3-40.7.
The Bennelong byelection will be held in four weeks, on December 16. With Barnaby Joyce almost certain to retain New England, Bennelong will decide whether the Coalition regains its parliamentary majority. Labor’s candidate is former NSW premier Kristina Keneally, while John Alexander will recontest for the Liberals after the possibility that he held British citizenship was renounced yesterday.
A Galaxy poll, conducted on November 15 from a sample of 579, had a 50-50 tie, a ten-point swing to Labor from the 2016 result. The only primary votes released so far are 42% for Alexander and 39% for Keneally. 42% thought Keneally had done a bad job as premier, while 37% thought she had done a good job. As Keneally led a government that was smashed in 2011, this negative assessment is to be expected.
A ReachTEL poll, conducted 16 November from a sample of 864, gave Alexander a 53-47 lead, a seven-point swing to Labor since 2016. Primary votes were 41.6% Alexander, 34.5% Keneally, 5.9% Greens, 5.4% One Nation and 8.3% undecided. Undecided voters in ReachTEL polls can be pushed into saying which way they lean, but this information is usually omitted by media sources.
Alexander had a 51% favourable, 15% unfavourable rating, and Keneally a 42% favourable, 28% unfavourable rating. In the last ReachTEL national poll, in late October, Malcolm Turnbull had a 51-49 better prime minister lead over Bill Shorten. In Bennelong, Turnbull had a much larger 60-40 lead.
These polls vindicate Labor’s selection of Keneally. Although Keneally has a somewhat controversial past, she has a high profile. A lower-profile candidate would have had difficulty overcoming Alexander’s advantage as the sitting member. With Turnbull’s big lead over Shorten, Keneally is performing well to be six points behind in ReachTEL.
In past elections, individual seat polls have performed much worse in predicting results than using statewide or national polls. The ReachTEL One Nation vote of 5.4% in Bennelong appears too high, as One Nation won just 1.4% for Bennelong in the NSW Senate in 2016, compared with 4.1% for the whole state.
The national swing to Labor is currently about 4.5 percentage points since the last election. An average of ReachTEL and Galaxy would have Alexander ahead by 51.5-48.5, an eight-point swing to Labor, so the swing is larger in Bennelong than nationally. Swings against governments are usually larger at by-elections than general elections.
Given the inaccuracy of single seat polls, Labor could be ahead, or Alexander could have a larger lead than in ReachTEL.
Liberal senator-designate Hollie Hughes disqualified by High Court
Nationals Senator Fiona Nash was disqualified on October 27, as she was a British citizen. Liberal Hollie Hughes, next on the joint Coalition ticket in NSW, took up public service work following her failure at the 2016 election, and was disqualified on 15 November under Section 44(iv) of the Constitution. With Hughes disqualified, Liberal Jim Molan is next on the Coalition ticket. The High Court could also declare this seat a casual vacancy, to be filled by the party that previously held the seat.
Hughes had missed out in 2016, and the High Court could have shown leniency as she did not knowingly hold a public service job while contesting an election. This decision is a clear warning that the High Court will not tolerate any breach of Section 44.
Right now there are around 21,000 artificial objects being tracked in Earth orbit (and many millions too small to be tracked). Only about 1,750 of these are functional satellites.
If we don’t adequately manage the traffic of objects in outer space, many services on which we depend will no longer be available.
I argue that Australia should step up and fill this role. “Space traffic management” could be an enduring, national beacon project to inspire and galvanise the Australian space industry. This will be particularly important as the prospective Australian space agency builds momentum in 2018.
Right now, the US Air Force is trying to divest itself of the space traffic management role – a responsibility that it has previously assumed for the world by default. The US Federal Aviation Administration has said that it is willing to take this on, but there are many issues to resolve, including control over assets, finances and human resources.
The Australian space industry, facilitated by the prospective Australian space agency, can seize this opportunity. We are well suited to play a role that will be valuable from a commercial perspective, and that will place us in a strong strategic position in the future global space industry and its governance.
where orbiting objects are, in as near to real-time as possible
whether they pose any risk of damage, such as a future conjunction between two objects, or interference, such as between the frequencies on which they transmit.
It could also encompass an advisory, or even directive, service to satellite operators to avoid collisions and avoid contributing to the existing space debris population. That implies that space “rules of the road” may be established.
Of course, satellites cannot physically stop at “intersections”, like we see in traffic management on Earth. But we could see development of means to actively prevent collisions, for example, by changing the orbit of space debris. That might be by another space object capturing and physically moving the space debris, or it could be done remotely, such as by a ground-based laser using photon pressure.
Australia is qualified
While Australia already has an active space industry, it is thinly spread. Government departments and agencies, universities, contracted aerospace companies (mostly large and foreign), local start-ups (mostly small) and some established Australian companies, all currently make up Australia’s participation in the space industry.
The Space Industry Association of Australia presented a case for an Australian space agency in its March 2017 White Paper. From the current 0.8% share of a US$340 billion global space industry, the Australian space industry is forecast to grow to 4% within 20 years. That calculation assumes that the efforts of the Australian space industry can be coordinated and facilitated by an Australian space agency.
In respect of managing space traffic from Australia, here are some capabilities we already have.
Tracking sensors. Australia has a growing number of sensors for tracking objects in space, including C-Band radar, Space Surveillance Telescope and space object laser tracking. Australian companies such as Saber Astronautics have been developing the means to “mine” the enormous amount of space-related data from radio astronomy sensors, notwithstanding that these were not originally designed with space traffic management in mind.
Moving debris. The Space Environment Research Centre is exploring how lasers for space object tracking based in Australia could be used for moving space debris at risk of colliding with active satellites. It also conducts other research to improve the quality of orbital predictions.
Historical and positive role in space. Australia has been active in the Committee on Peaceful Uses of Outer Space since its inception in 1959. Australian initiatives are given serious consideration by the international community, without the political polarisation that our superpower ally, the USA, can draw.
Australia is therefore not only well suited to contribute to space traffic management in a physical sense, but also in a regulatory sense – including facilitating the establishment of an appropriate regulatory regime.
Australia can benefit
Both myself and others have advocated for the global strategic importance of normalising the space environment. This involves establishing regular and predictable patterns of behaviour through legal rules and less formal practices and procedures. It is also a matter of national strategic significance.
An international space regulator is almost certainly going to emerge in the next decade and is likely to have some sort of gatekeeper function, including ensuring safety and sustainability in space through effective space traffic management.
Whichever nations play an active part in this role stand to gain significant international influence, and also significant commercial opportunities. This is particularly important with the impending launches of mega-constellations whose operating satellites must be protected.
Australia can and should have a key part in global space traffic management.
Are we going to see an Amazon or Apple remake of Crocodile Dundee, Blinky Bill, The Magic Pudding, The Castle or Picnic at Hanging Rock? Should we restrict overseas exploitation of such icons of Australian identity? Should we not bother, on the basis that Australian content doesn’t work in Mumbai or Belgrade or Boston?
This week has seen controversy over Amazon’s plan for a Lord of the Rings series, feeding what it hopes is an insatiable appetite for hobbits. It’s part of Amazon chief executive Steve Bezos’s ambition to offer a global one-stop shop for culture and other consumables. Amazon aims to be a universal service provider in a landscape where broadcast tv, cable tv and traditional retailers wither and die.
The plan tells us something about culture: it’s for sale. It also tells us about franchising content for global markets: media executives are risk-averse and unimaginative. It leaves unanswered questions about taking Australia’s content to the big screen (and importantly little screens) across the world.
Recycling popular culture
Recycling popular culture, very profitably, isn’t new. We can see it with the many iterations of Batman and Superman videos, films, t-shirts, books, posters and toys since the original comics. We can see it with more than 160 years of remakes of Sweeney Todd. Think Frankenstein and Dracula or Godzilla or Sherlock Holmes.
There’s money to be made from recycling and authorised spinoffs, duly policed or contested by copyright and trade mark lawyers – the gatekeepers of the information economy.
On that basis, Amazon’s vision is unsurprising. Billion-dollar deals in recent decades have involved media groups buying comic publishers such as Marvel, on the basis that the publishers managed to get the vital intellectual property rights. Other big-ticket deals involve Peter Rabbit, Thomas the Tank Engine and Hercule Poirot. That means there’s yet another Murder on the Orient Express on the big screen, with big actors, big moustaches and – the producers hope – big box office.
There’s nothing to stop such recycling and the proliferation of products such as Peter Rabbit or Darth Vader figurines, plates, lunchboxes, t-shirts and sheets apart from intellectual property rights. Rights owners are free to licence, gift or simply sell their creativity. Contention has usually centred on whether they sold too cheaply or unwisely – one claim with the Agatha Christie and Tolkien estates – or whether the value of the ‘brand’ was eroded through too many tasteless products.
On that basis we can expect to see an ongoing proliferation of products and a recycling of “classic” works ranging from Casablanca to The Empire Strikes Back. Marketers will respond to what they perceive to be market demand. Recycling will occur because the managers running the large media groups – which will increasingly include businesses such as Apple, Amazon and Microsoft – are risk averse. It is safer and easier to refashion existing content than develop truly new content.
Safety reflects a lack of imagination: your peers are making money by bringing comic book heroes to the big screen, so you can too. A global distribution system – one reason why the big companies remain important – means that you can sell other-worldly content across the globe. No worries that audiences in Karachi or Shandong or Harare or Melbourne will reject a tale about purdah or genocide in Bosnia or colonisation on the US frontier. Hobbits and R2D2 and Spiderman are universal.
Protecting the ‘Australian identity’
Is this good news for Australian creators and for people who think about protecting the “Australian identity”? The answer is yes and no.
Australia doesn’t have law prohibiting sale to an overseas buyer of rights in iconic works such as Dot & the Kangaroo, The Muddleheaded Wombat, Possum Magic, The Magic Pudding, Johnno, The Man Who Loved Children or Wake in Fright. It doesn’t restrict licensing of those works. Despite the Prime Minister’s recent foray into populism about Ugg boots, it is difficult to see any government establishing credible restrictions.
The bad news is that overseas marketers appear to believe that Australian content doesn’t travel. We are accordingly an importer rather than a major exporter of literature and film. That is an issue in debate about copyright changes. It may reflect stereotypes – Nordic noir, English bluebloods, quirky New Zealand, Indian Bollywood, Australian deserts and men with dresses or Dundee knives.
The state governments have been enthusiastic about establishing Brisbane, Sydney and Melbourne as “film cities”. Major overseas productions, including Thor and Pirates of the Caribbean, have used Australian infrastructure and skills. We haven’t however seen many distinctively ‘Australian’ works go global. Works such as The Slap have been refilmed with offshore settings and offshore accents.
Sassy koalas and talkative flying kangaroos might make a breakthrough into the the global market. We want that because it encourages emulation rather than just enriches the creator and creator’s estate.
If we are concerned about national cultural policy we might controversially put less taxpayer money into support of the local arms of overseas media groups, all of which pay very little tax, and instead foster local production and global distribution.
Queensland election campaigns often focus on bigprojects for the regions, such as for roads, power plants and mines. But research suggests that mega projects, such as in gas and coal, have not transformed skills or improved employment prospects in regional Queensland.
Take away the temporary booms from construction and other short-term jobs, and employment growth overall is no better than before the global financial crisis. Certainly Queensland’s regions are no more resilient. Instead of these mega projects, what’s needed are new sources of economic value in knowledge, services, and technology.
These projects fell far short of generating new skills and enduring businesses in the regions. Continuing dependence on resources and agriculture also creates its own vulnerabilities, as both are challenged by market and investment volatility, and increased climate risk.
Overall the focus on mega projects has weakened social and economic resilience in communities across Queensland. Resilience refers to the capacity of regional communities to handle risks and manage change. Resilient regions deepen and diversify their economies.
Megaproject sugar highs
Annual construction spending in the resources sector peaked at A$36.6 billion in Queensland in 2013-14, and has dropped by 70% since. Unemployment has doubled in Queensland’s northern, central and outback regions.
The impact is seen in Townsville, Rockhampton, and Gladstone, who are now pitching to become bases for “Fly In Fly Out” workers. Rather than drive their own local economic development, these cities are punting on the next big mining project.
Gladstone is already the pin-up of the construction boom-bust development model. The port city boasts a highly trained workforce in alumina and aluminium processing, cement, liquid natural gas and chemical manufacturing. Still, it waits on the next big mining construction boom.
What regional Queensland really needs is politicians to abandon short-term economic fixes, in favour of a sustainable long term vision. Policies would have greater impact if they focused on skills and enterprise training. Stronger regional collaboration to broker opportunities for smart businesses is essential.
Just north of Brisbane, Moreton Regional Council is showing the way by transforming a former industrial site into a university campus. Tertiary education will come to the fast growing region along with a research and technology park, creating the jobs of the future.
Regional Queensland can also learn from the European Commission’s “smart specialisation” structural assistance programs that help regions build knowledge-based competitive industries through strategic public funding and support for research and development etc.
Integral to the European strategy is strong collaboration between the research and university sectors, and regional industries. Strong cooperation between levels of government is key to the success. The industries are as varied as cheese manufacturing in Spain, new transport systems in Finland, and materials manufacturing in France.
The Europeans have found that changing business culture and boosting entrepreneurship are just as important to creating opportunity as large infrastructure projects.
What Queensland should do
Queensland should rethink its big projects for a big country approach. Regional jobs that depend on project investment without generating local income are not sustainable. Small business and community must be restored to centre stage in development strategy.
Small and medium businesses collectively account for more than 99% of all business in Queensland, and three times as many people work in the state’s A$20 billion manufacturing sector (169,000) as work directly in the resources sector (48,000).
But small and medium businesses lack the profile of the “big end of town”, and the large resources companies have been effective at selling the narrative that they are central to the A$300 billion Queensland economy.
The priority for developing Queensland’s regions should be investment that generates small business growth, local income, new skills and communities. Particular emphasis has to be given to attracting and retaining talented people.
The state government can best help regional Queensland by heeding the Productivity Commission’s call to help regional Australia adapt and exploit the opportunities of ever present change. This requires greater local initiative, making the most of competitive strengths, and training people to better engage with the world.
The global services sector is a $US47 trillion industry. For regional Queensland to tap into this sector will require skills in fields as diverse as big data, biotechnology, genetics, robotics, communications, and digital manufacturing.
This approach challenges the current politically dominated top down model of regional development. It’s a vision for regional Queensland that extends beyond resources, agriculture, tourism and construction to the people themselves.
It is time to accept that Section 44 of the Australian Constitution is irretrievably broken. In its current form, it is creating chaos that is consuming our politicians. This presents a rare opportunity for constitutional change. A referendum could address not only the citizenship issue but the entirety of Section 44, which no longer looks fit for purpose.
The “brutal literalism” adopted by the High Court means that there can be no quick or stable resolution to the citizenship saga consuming the national political class.
Even a thorough “audit” of current politicians, such as the deal announced this week by Prime Minister Malcolm Turnbull, will offer only a temporary respite. Not only can it be extremely difficult to determine if someone has foreign citizenship, the agreed disclosures will not capture all potential issues (for example, it only extends back to grandparents).
Moreover, as foreign citizenship is dependent on foreign law, a foreign court decision or legislation may subsequently render a person ineligible.
This issue will continue to dog all future parliaments.
The idea that the Constitution provided a “flashing red light” on this issue is mistaken. The dual citizenship problem has long been an open secret. It has been the subject of numerous parliamentary reports over the last 40 years, the most recent in 1997.
A royal commission was once suggested to audit all politicians. This has been a time bomb waiting to go off, but one that stayed strangely inert for more than 100 years.
Moreover, no-one really knew how the High Court would resolve the “citizenship seven” case. Turnbull was widely mocked for his initial certainty about Deputy Prime Minister Barnaby Joyce’s eligibility.
Following the High Court’s unexpected same-sex marriage decision, few commentators felt any confidence in predicting how it would decide the “citizenship seven” case. The result could easily have gone the other way.
More significantly, the court has imposed a far harsher test than expected. Not only is knowledge of potential ineligibility irrelevant, it is not sufficient that a person takes “reasonable steps” to divest foreign citizenship. Unless a foreign law would “irredeemably” prevent a person from participating in representative government, the fact of dual citizenship will be sufficient to disqualify a person.
It is this strict new interpretation that has cast doubt over the eligibility of politicians such as Labor MP Justine Keay. Keay had renounced her British citizenship prior to nomination, but did not receive final notification until after the election.
Prospective politicians would be required to irrevocably rid themselves of dual citizenship early enough to ensure this is confirmed prior to nomination. The Bennelong byelection provides a graphic illustration of the issue – the ten days between the issuing of the writs and the close of nominations would be far too short for any effective renunciation.
Serious unresolved issues remain, even before we get into the difficulty posed by the “entitled to” restriction in Section 44. This provision could, for example, render Jewish politicians ineligible under Israel’s “right of return” laws.
Section 44 is not only unworkable, it is undesirable. The spectre of Indigenous leader Patrick Dodson being potentially ineligible, or Josh Frydenberg facing questions after his mother fled the Holocaust, reveal the moral absurdity of this provision. In a modern multicultural society, where citizenship rights are collected to ease travel and work rights, a blanket prohibition is archaic and inappropriate.
Perhaps by giving us an (unnecessarily) unworkable interpretation, the High Court has unwittingly provided the impetus to reform the entirety of Section 44.
That section is concerned with more than just citizenship. Disqualifying attributes including jobs in the public service, government business ties, bankruptcy and criminality.
In disqualifying Senators Bob Day and Rod Culleton earlier this year, the High Court again interpreted the provisions unexpectedly strictly. Again, this strict interpretation has invited challenges to other politicians.
Under the current law, it seems a potential candidate must irrevocably rid themselves of all (potentially valuable) disqualifying attributes prior to nominating, on the chance they may be elected.
Jeremy Gans, one of the most vocal critics of the High Court’s decision, has described this as “one of the Constitution’s cruellest details”. Moreover, as Hollie Hughes’s case illustrates, a defeated candidate may need to avoid these activities even after the election on the off chance of a recount.
Constitutional change offers a chance to break this deadlock. The process does not need to be long and convoluted. We already have a draft text. The proposal suggested by the 1988 Constitution Commission scrapped all disqualifications except the prohibition on treason, and offered a reworked restriction on employment. Other matters would be left to parliament
This well-considered proposal is compelling. We could have an act passed by Christmas, and a referendum early in the new year. The same-sex marriage survey, a matter that will affect many more people far more substantially, has been organised and executed in a far shorter time.
This is a technical issue, but it is consuming vital public resources and distracting our politicians from the role of governing Australia. Changing the Constitution is the only way to draw a line under this chaos.
Our Constitution was never meant to be a static document. It is now more than 40 years since we successfully amended the Constitution, and nearly 20 years since a referendum was even held. Both of these are record periods of time for our Federation.
This has perpetuated the myth that constitutional change is effectively implausible. A referendum on Section 44 would re-engage the Australian people in this vital process. This will, in turn, make it easier for other causes, including Indigenous rights and the republic, to be taken to referendum.
The Royal Commission into the Protection and Detention of Children in the Northern Territory’s final report, which was handed down on Friday, revealed “systemic and shocking failures” in the territory’s youth justice and child protection systems.
The commission was triggered following ABC Four Corners’ broadcasting of images of detainee Dylan Voller hooded and strapped to a restraint chair, as well as footage of children being stripped, punched and tear-gassed by guards at the Don Dale and Alice Springs youth detention centres.
The commission’s findings demonstrate the need for systemic change. However, the commission will not, in itself, bring about that change. Its capacity to make lasting change lies with the government implementing its recommendations.
What did the commission find?
The commission found that the NT youth detention centres were not fit for accommodating – let alone rehabilitating – children and young people.
It also found that detainees were subjected to regular, repeated and distressing mistreatment. This included verbal abuse, racist remarks, physical abuse, and humiliation.
There was a further failure to follow procedures and requirements under youth justice legislation. Children were denied basic human needs, and the system failed to comply with basic human rights standards and safeguards, including the Convention on the Rights of the Child.
The commission also found that the NT child protection system has failed to provide appropriate and adequate support to some young people to assist them to avoid prison.
Importantly, the commission found that isolation “continues to be used inappropriately, punitively and inconsistently”. Children in the high security unit:
… continue to be confined in a wholly inappropriate, oppressive, prison-like environment … in confined spaces with minimal out of cell time and little to do for long periods of time.
What did the commission recommend?
Based on these findings, the commission recommended wide-ranging reforms to the youth justice and child protection systems.
Not surprisingly, a central focus of the recommendations relate to detention. They ranged from closing the Don Dale centre to significant restrictions on the use of force, strip-searching and isolation, and banning the use of tear gas, spit hoods, and restraint chairs.
There is a focus on greater accountability for the use of detention through extending the Commissioner for Children and Young People’s monitoring role. Recommendations also cover health care (including mental health and fetal alcohol spectrum disorder screening), education, training, and throughcare services for children exiting detention.
Among its suite of proposed reforms, the commission recommended developing a ten-year strategy to tackle child protection and prevention of harm to children, and establishing an NT-wide network of centres to provide community services to families.
Youth justice reforms include improving the operation of bail to reduce the unnecessary use of custodial remand; expanding diversionary programs in rural and remote locations; and operating new models of secure detention, based on principles of trauma-informed practice.
Adequate and ongoing training and education for police, lawyers, youth justice officers, out-of-home-care staff and judicial officers in child and adolescent development is also recommended.
The commission also emphasised the importance of developing partnerships with Indigenous organisations and communities in the child protection and youth justice systems. Several organisations in written submissions to the commission identified the importance of appropriately resourcing community-controlled, and locally developed and led, programs for Indigenous young people.
Increasing the age of criminal responsibility a good place to start
One of the commission’s most significant recommendations is to increase the minimum age of criminal responsibility to 12 years, and only allowing children under 14 to be sentenced to detention for serious offences.
If this recommendation were to be implemented it is likely to have far-reaching implications across Australia. Currently, the minimum age is ten years in all states and territories.
Of particular relevance to the commission is the adverse affect of a low minimum age of criminal responsibility on Indigenous children.
The majority of children under the age of 14 who come before Australian youth courts are Indigenous. In 2015-16, 67% of children placed in detention under the age of 14 were Indigenous. This concentration is even higher among those aged 12 or younger.
Nationally, 73% of children placed in detention and 74% of children placed on community-based supervision in 2015-16 were Indigenous.
Raising the minimum age of criminal responsibility opens the door to responding to children’s needs without relying on criminalisation, given its short- and long-term negative impacts.
It enables a conversation about the best responses to children who often – as the commission’s findings acknowledged – have a range of issues. These can include trauma, mental health disorders and disability, coming from highly disadvantaged backgrounds, having spent time in out-of-home care, and – particularly among Indigenous children – being removed from their families and communities.
A positive outcome from the commission will require political will and leadership to respond effectively to broader systemic issues. Raising the minimum age of criminal responsibility is a good place to start.
Vital Signs is a weekly economic wrap from UNSW economics professor and Harvard PhD Richard Holden (@profholden). Vital Signs aims to contextualise weekly economic events and cut through the noise of the data affecting global economies.
This week: Australia continues to grow jobs, but wages aren’t keeping up and policymakers are running out of options.
Let’s begin with an economy that is doing relatively well.
In the US, the data were both predictable and moderately positive.
Consumer prices (as measured by the CPI) were up only 0.1% in October, but this was in line with expectations. Recall that two major hurricanes drove up gasoline prices in September, and those increases rolled off (they were up 13.1% in September and fell 2.4% in October). The year-on-year CPI increase was 2.0% – again, in line with expectations.
The Producer Price Index (PPI) rose by a healthy 2.6% on a year-on-year basis – despite a drop in gasoline prices for producers of 4.6% (note the difference between wholesale and retail price changes). Perhaps most importantly, there were relatively strong increases in elements of the index that the US Federal Reserve cares most about (as they are less cyclical than, say, energy prices), like healthcare costs.
Less expected, but happy news, was the 0.2% rise in retail sales. That puts retail sales up 4.6% on an annual basis. This is further evidence of the solid rebound in the US economy.
But the continued depressing news is about wages. The wage-price index was up 0.5% for the third quarter, below market expectations of 0.7%. That puts annual wages growth at 2.0%. With inflation running at 1.8%, that means real wages growth is effectively zero. And it has been like that for a long time.
This is causing enormous problems for Australian households and policymakers.
Recall that Australian households are among the most highly leveraged in the world – with debts at around 190% of GDP. So what is going to reduce that debt?
There are two possibilities: more inflation or more income. Inflation helps reduce the debt in real terms, and income helps for obvious reasons. Right now, both avenues look shaky.
That leaves us with heavily indebted households, with no obvious way out. This, of course, puts a strain on consumer spending, which in turn affects business investment and employment, and the whole (vicious) cycle loops back on itself.
What is the cut-through for policymakers?
The RBA could drop interest rates from their current 1.50% level – and increasingly some economists are suggesting that. The worry is that a rate cut might further fuel housing prices, making the problem worse, not better.
Federal income tax cuts would be another avenue, but with the budget in structural deficit, and with an economically illiterate crossbench, that looks unlikely.
The government could embark on a major infrastructure spending plan, which could rejuvenate regional employment in areas hit by the forces of globalisation. With interest rates at very low levels, for very long maturities, this seems like a good idea, as long as the projects are assessed on a rational basis.
The concern in this regard is politics. Both major parties have their predilections and bases to pander to. A bad outcome would be, for example, a big coal mine investment by the Coalition, and some uneconomic green-energy boondoggle by the opposition.