Homeless numbers will keep rising until governments change course on housing

Gavin Wood, RMIT University; Guy Johnson, RMIT University; Juliet Watson, RMIT University, and Rosanna Scutella, RMIT University

Ten years ago the Australian government launched a National Partnership Agreement on Homelessness (NPAH). It injected A$800 million into homelessness services and A$300 million to build 600 new homes for people experiencing homelessness. It was later announced that another A$400 million would be available under the National Affordable Housing Agreement (NAHA) to build new housing and supported accommodation for the homeless. Total recurrent expenditure (at 2016-17 prices) on homelessness services has increased by 28.8%, from A$634.2 million in 2012-13 to A$817.4 million in 2016-17.

But despite this, the number of people experiencing homelessness and the rate of homelessness have both increased. Our research points to problems in the public housing system as one of the more important causes of these increases.

According to census figures released on Wednesday by the Australian Bureau of Statistics (ABS), the number of homeless people in Australia has risen by 14% to 116,427. The rate of homelessness has increased from 47.6 people per 10,000 of the population in 2011, to 49.8 per 10,000 now. (The ABS defines homelessness here.)

There is some good news: the numbers of Indigenous homeless and homeless children and youth (aged 12-18) have declined by 26%, 11% and 7% respectively since 2011. But on the downside, increases are particularly pronounced in New South Wales (where the homelessness rate rose by 27% and among people aged over 65 (by just over 30%) and overseas-born migrants (by 40%).

Read more:
More and more older Australians will be homeless unless we act now

Why are we still going backwards?

Changes in Australian housing and welfare systems and wider social and economic developments appear to have more than offset any benefits from the NPAH and NAHA. Our research sheds some light on the role played by Australia’s housing system. Using the internationally recognised and unique Journeys Home longitudinal survey, we find that public housing is the most important factor in preventing homelessness among vulnerable people.

Public housing is particularly effective because it is affordable. It has also traditionally offered a long-term refuge for precariously housed people. This is because public housing leases provide the benefits of security of tenure commonly associated with home ownership.

It is perhaps no accident that NSW was one of the first states to introduce fixed-term tenancies in public housing. This eroded one of the major attributes of tenure, in a state that has seen relatively large increases in homelessness numbers.

The empirical evidence also suggests that community housing fails to provide the same protection for people at risk of homelessness. While community housing is affordable, the security of tenure is weaker, which may explain these findings.

Despite such evidence, the stock of public housing continued to decline between the 2011 and 2016 censuses. State government-initiated transfers of stock to the community housing sector accelerated this trend. In 2013 Australia had a public housing stock of 325,226 dwellings. This declined by 3.2% to 314,864 usable dwellings in 2017.

Read more:
Australia needs to reboot affordable housing funding, not scrap it

Where are the additional homeless coming from?

One of the more alarming changes is a sharp increase in the number of homeless people over 65. This partly reflects Australia’s ageing population. However, the increase is such that the elderly’s share of the total homelessness count has also risen.

Furthermore, our research suggests that this trend could become protracted. This is because the homeless elderly have much less chance of escaping into formal housing than younger people experiencing homelessness. We have little understanding of the reasons for this, but gaps in service provision to the aged could be partly responsible.

The other group who feature prominently among the homeless are overseas migrants. They now make up 46% of the homeless, despite representing just 28% of the Australian population. The number of homeless overseas-born migrants has soared by 40% since the 2011 Census, from 38,085 to 53,606 people.

It turns out that homeless overseas-born migrants are concentrated among those living in severely overcrowded dwellings – a little over half of those living in these conditions were born overseas. We know little about these homeless people. Discrimination could be a factor, though some characterise this group as students living in group households who should not be considered homeless. But this is speculation and further study is certainly required.

Read more:
Ghost-hunting: will the census reveal the true scale of homelessness in Australia?

In view of the latest census results, it is clear to us that governments need to reassess their approach to what is turning into an intractable social problem.

We do not deny that situational factors, such as drug abuse, domestic violence and so forth, are important here. But equally, there is strong evidence that structural problems in our housing market are a significant cause of growth in the numbers of homeless people.

The ConversationUntil these problems are resolved, service provision and support will remain a band-aid masking deeper social and housing system issues.

Gavin Wood, Emeritus Professor of Housing and Housing Studies, RMIT University; Guy Johnson, Professor, Urban Housing and Homelessness, RMIT University; Juliet Watson, Lecturer, Urban Housing and Homelessness, RMIT University, and Rosanna Scutella, Senior Research Fellow, Centre for Applied Social Research, RMIT University

This article was originally published on The Conversation. Read the original article.


How the government can pay for its proposed company tax cuts

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The government is still attempting to lower the corporate tax rate to compete globally.
Ben Rushton/AAP

David Ingles, Crawford School of Public Policy, Australian National University and Miranda Stewart, Crawford School of Public Policy, Australian National University

There are ways the government can pay for a cut in the company tax rate. In a recent working paper, we worked with researcher Chris Murphy to model three different options: reforming Australia’s system of giving shareholders tax credits, allowing less tax deductions on interest for companies, and introducing a tax on the super-profits of banks and miners.

After taking economic growth into account, the budget cost of the tax cut could be net A$5 billion a year.

Read more:
Race to the bottom on company tax cuts won’t stop tax avoidance

In the US, a company tax cut to 21% continues an inexorable global trend of cutting rates, making international tax competition even more pressing. As our working paper noted, Australia’s rate is now higher than most other countries, making tax avoidance even more attractive and deterring inbound foreign investment.

A cut in the Australian company tax rate to 25 or even 20% is important because it will attract foreign investment, boosting wages and the economy in Australia.

Remove dividend imputation

Australia has an unusual system of integrated company and personal tax, called dividend imputation. It has been in place since the 1980s.

Australian shareholders receive franking (imputation) credits for company tax. If shareholders are on a personal tax rate less than 30%, they receive a refund.

The company tax cut could be financed by removing dividend imputation. Our modelling indicates a company tax rate of 20% would mean the government breaks even, while halving imputation could finance a 25% rate.

It would be simpler to abolish dividend imputation and replace it with a discount for dividend tax, at the personal level.

Read more:
Qantas and other big Australian businesses are investing regardless of tax cuts

Dividend imputation only makes sense if we assume Australia is a closed economy with no foreign investors. In reality, Australia depends on inflows of foreign investment. About one-third of the corporate sector is foreign owned.

The likely source of additional finance, especially for large Australian businesses, is a foreigner who does not benefit from dividend imputation. So the company tax pushes up the cost of capital and domestic investors benefit from franking credits for a tax they don’t actually bear.

But the politics of making a change to the system are difficult, because domestic investors, especially retirees on low incomes and superannuation funds would lose out. But this approach could benefit workers, jobs and Australian businesses.

Broaden company tax by removing interest deductibility for companies

Another approach is to remove or limit deductibility of interest for companies. This can raise the same revenue at a lower rate, by allowing less deductions. Excessive interest deductions are used by multinationals to reduce their Australian tax bill, as shown in the recent Chevron case.

This would be like imposing a withholding tax on interest paid offshore. We explore a comprehensive business income tax on all corporate income. Modelling shows that this tax would finance the rate cut to 25%.

The comprehensive business income tax raises some difficult issues for taxing banks. This is because their profit is interest income less interest expense.

But there are numerous policies to restrict interest deductions already in place, here and around the world. These restrictions could be expanded. For example the thin capitalisation rules limit of the amount of loans a business can have relative to equity.

We still need anti-abuse rules because businesses can use other methods to minimise tax, as canvassed by the OECD in its Base Erosion and Profit Shifting project, including transfer pricing, and deductible payments offshore for intellectual property fees.

A rent tax or allowance for equity

A third option for a company tax cut is to change to a tax with a lower effective marginal rate. This means that the return on a new investment is taxed less heavily than under a company income tax.

We could introduce an allowance for corporate equity, or corporate capital, which provides a deduction for the “normal” or risk-free return for capital investment. This is also called an economic rent tax because it only taxes the above-normal profit.

Modelling shows that the allowance for corporate capital encourages new investment, which helps economic growth, but there is a large budget cost. The extra deduction reduces the overall tax take and so a higher rate is needed for the same revenue.

It is unlikely Australia would want to maintain or increase our company tax rate, as this directly contrary to the global trend and can lead to even more tax planning by businesses.

For Australia, a supplementary rent tax aimed at the financial and mining sectors – where above-normal returns are known to occur – could be combined with a lower company income tax. Modelling this option for the finance sector shows a large welfare gain and sufficient revenue to fund the rate cut to 25%.

The government has a lot of choices

We show that the government has many options available to finance the needed corporate rate cut and improve efficiency of the company tax.

Policymakers could mix and match these options. Dividend imputation could be replaced with a discount and combined with a comprehensive business income tax. Limits on interest deductibility could be combined with a part allowance for corporate capital.

The ConversationReplacing dividend imputation with a dividend discount at the personal level could be the best initial step. Other options for major reform of Australia’s company tax need to remain on the table, as company taxes drop to a new low and systems are reformed around the world.

David Ingles, Senior Research Fellow, Tax and Transfer Policy Institute, Crawford School of Public Policy, Australian National University and Miranda Stewart, Professor and Director, Tax and Transfer Policy Institute, Crawford School of Public Policy, Australian National University

This article was originally published on The Conversation. Read the original article.

Hodgman rides Tasmanians’ disdain for minority government to a second term in office

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The Tasmanian election result was an emphatic win for Will Hodgman, but he lost a fair bit of skin along the way.
AAP/Julian Smith

Richard Eccleston, University of Tasmania

In an era of single-term governments and growing electoral volatility in Australia, the return of Will Hodgman’s Liberal government at Saturday’s Tasmanian election with more than 50% of the primary vote is significant – and will have national implications.

The Turnbull government will take comfort from a result that demonstrates voters – even in left-leaning Tasmania – are prepared to re-elect a competent Liberal government that has delivered strong economic and employment growth.

It was a strong result for the Liberals. However, the outcome was shaped as much by Tasmania’s distinctive political practices and local issues as it was by national trends.

Pokies, housing, hospitals, and – at the 11th hour – watering down gun laws might have been the specific issues that dominated the campaign, but the decisive factor was Tasmanians’ enduring apprehension about minority government.

The legacies of Labor-Green minority government of the early 1990s and between 2010 and 2014 cast a long shadow during the 2018 campaign. Both periods are associated with economic decline, rising unemployment, and budget cuts.

While there is little evidence to suggest minority government has been a cause of poor economic outcomes in Tasmania – it is more that these governments were unlucky and found themselves in charge after national downturns – the fact remains that Tasmanians have a strong preference for majority government.

Given this history, undecided Tasmanian voters tend to back the major party that’s most likely to form majority government. This was evident in both 2006 and 2014, and was always going to be a feature of the 2018 campaign given memories of the 2012-13 recession in Tasmania are still fresh in voters’ minds. And the Liberal government, which was elected in 2014, has delivered strong economic growth.

It is this bandwagon effect that helps explain why support for the government increased by ten points over the course of the campaign, rather than going to minor parties – as has been the case elsewhere.

Read more:
Liberals romp to emphatic victory in Tasmanian election

What now for the Liberals?

The final result was an emphatic win for Hodgman. But it is also fair to say he lost a bit of skin along the way, due to the Liberals’ big-budget, brutally effective advertising campaign seeming to have been funded by gaming interests.

The reality is that Tasmania remains deeply divided on pokies and the means the gaming industry uses to protect its interests.

Tasmanians voted for political and economic stability on Saturday, but an overwhelming majority support Labor’s policy of phasing pokies out of pubs and clubs over a five-year period.

Read more:
Removing pokies from Tasmania’s clubs and pubs would help gamblers without hurting the economy

The pokies debate is far from over. Hodgman must commit to open and transparent government, and subject his gaming policies to full parliamentary scrutiny in an attempt to regain the electorate’s trust. Opposition parties also have a role to play, and must be willing to compromise to find some middle ground.

The election’s losers

The result wasn’t a disaster for Labor.

Rebecca White, after securing the Labor leadership only a year ago, performed strongly during the campaign and has consolidated her credentials as a future premier. That she will be leading a stronger opposition bolstered by handful of up-and-coming new MPs also bodes well for Labor’s future.

The real losers in the election were the Greens and Jacqui Lambie.

In contrast to their success in inner-Melbourne and Sydney, the Greens have been struggling in Tasmania in recent years. The explanation for their decline in their former heartland can be attributed to the legacies of the last government, the absence of a high-profile local environmental issue, and that Labor, under White, has championed many of their core progressive causes.

Lambie and her party could have been the wildcard of this election, but she has had a tough summer and will have to fight hard to salvage her political career. Had Lambie herself run as a candidate on Saturday, it’s likely she would have been elected – and could have held the balance of power in the lower house.

Strangely, given that personalities and name recognition are so important in Tasmanian elections, she ran a ticket of grassroots candidates under her Jacqui Lambie Network banner that, as expected, failed to secure any serious support.

Lessons for the future

As the dust settles, we can draw a few conclusions from the Tasmanian election result.

Above all else, Tasmanians are a pragmatic bunch and are prepared to reward a government that delivers political stability and good economic outcomes.

The campaign also highlighted the power of sectional interests – be they mining, gaming or other actors – in Australian politics. The collective health of our democracy depends on curbing the influence of these groups at both the state and federal level.

The ConversationGiven the distinctive dynamics of Tasmanian politics, not too much can be read into the swing away from minor and protest parties and back to the majors. Perhaps the real test of the national political mood will come in South Australia on Saturday week.

Richard Eccleston, Professor of Political Science; Director, Institute for the Study of Social Change, University of Tasmania

This article was originally published on The Conversation. Read the original article.

Federal government’s foreign donations bill is flawed and needs to be redrafted

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The only effective way of destroying the undue influence of large foreign donations is by placing a cap on all donations.
AAP/Lukas Coch

Anne Twomey, University of Sydney

Preventing foreign influence over Australian elections is important. It is also important that legislation designed to achieve this is effective and does not impose collateral damage or leave itself open to constitutional challenge.

How well does the Turnbull government’s foreign donations bill stack up? Does it achieve its aim of preventing foreign donations from affecting Australian elections?

Not at all. It permits foreign citizens to make as many political donations in as large amounts as they wish, if it is done by a permanent resident or a foreign-owned company that is incorporated in Australia.

To be fair, there are constitutional reasons for this. It is unlikely that a ban on donations from permanent residents or companies incorporated in Australia would survive a constitutional challenge. But it also means any foreign government seeking to influence Australian elections can still easily do so.

The only effective way of destroying the undue influence of large foreign donations is by placing a cap on all donations, as occurs in New South Wales. But the federal government has chosen not to go down this path.

Read more:
Ban on foreign political donations is both too broad and too narrow, and won’t fix our system

It is ironic, then, that Special Minister of State Mathias Cormann says exempting charities from the bill would render the ban on foreign donations “entirely ineffective”. It is ineffective at preventing foreign influence anyway, so excluding charities could hardly make any difference to achieving that aim.

Meanwhile, Prime Minister Malcolm Turnbull argues that only seven out of 55,500 registered charities reported political expenditure last financial year, and that the bill “has no effect on foreign funding for charities’ non-political activity or charities’ political campaigning where it is funded by Australians”.

This is misleading for two reasons.

First, the bill relies on a greatly broadened definition of political expenditure. It now includes any expenditure on the expression of public views on an issue that is “likely to be before electors in an election”, regardless of when the election is held. This could include anything from expenditure on ads supporting same-sex marriage to books on climate change and websites supporting Indigenous constitutional recognition. Given the wide range of issues that may be before electors in an election, the bill is likely to catch a large number of charities, along with universities, corporations and others.

Second, it does not matter whether a charity actually receives any foreign donations or not. It may only receive donations from Australian sources and still be seriously affected by the bill. This is because onerous reporting obligations attach to bodies deemed to be either a “political campaigner” or “third party campaigner”.

For example, spending as little as A$14,000 on the public expression of views on an issue that is likely to be before electors is sufficient to be categorised as a third party campaigner, regardless of whether or not the person or body receives any foreign donations.

A third party campaigner must lodge annual reports detailing:

  • its political expenditure
  • its senior staff and any membership by them of political parties
  • any grants, contracts or payments from Commonwealth, State or Territory governments
  • a signed statement by its financial controller that it has complied with the rules about receiving gifts, such as charitable donations.

If a third party campaigner has received gifts that allowed it to engage in political expenditure, and the amount of at least one such gift (or cumulative gifts from the same donor) was above A$13,500, then it also has to provide an annual return that sets out the amounts of such donations, the date they were made and the name and address of each donor.

Most burdensome of all is the requirement to identify the source of every gift it receives. This includes very small donations, as it has to be able to identify whether the gifts from any single donor cumulatively exceed A$250. It then has to obtain a statutory declaration from each donor of more than A$250 that they are an “allowable donor”, such as a citizen, a permanent resident or a body incorporated in Australia. The penalty for breaching these requirements is up to 10 years imprisonment for the financial controller of the third party campaigner.

If you were a charity, which only collected donations from within Australia, and you wished to spend money on advocacy about government policies on homelessness, what would you do? Would you send lawyers out to accompany every door-knocker when you collect donations? Would you risk insulting your donors by requiring them to sign a legal document declaring that they are citizens or permanent residents?

Would you spend a considerable portion of the donations you receive on administering a complex reporting system, with the risk of imprisonment if you breach the rules? Or would you decide that the only rational solution is not to spend any money on advocacy about homelessness?

Read more:
Green groups and charities could be collateral damage in government’s foreign donation ban

If the purpose of this bill is to prevent foreign donations from influencing elections, it manifestly does not achieve that outcome. Foreign citizens can still donate as much as they like to Australian political parties by donating through a company they have incorporated in Australia.

But if the purpose of the bill is to deter charities and other third parties (regardless of whether they have received a single cent of foreign money) from spending money on the public expression of views that might entail criticism of government policies, then it would very effectively achieve that outcome.

This disconnect between the bill’s claimed purpose and likely effect may cause problems for the government if the legislation is passed and then challenged before the High Court. The Court has already held that limiting the sources of political donations imposes a burden on the constitutionally implied freedom of political communication.

Such a law will only be valid if it passes a proportionality test. That is, the law must be reasonably appropriate and adapted to achieve its claimed legitimate purpose. If its effects go far beyond that purpose, are unnecessary to achieve that purpose and disproportionately damage political communication, then the law will be held invalid.

The ConversationOn that basis, this bill is highly vulnerable to a constitutional challenge and needs to be redrafted so that it achieves its aim but does not impose unnecessary collateral damage on charities and other bodies.

Anne Twomey, Professor of Constitutional Law, University of Sydney

This article was originally published on The Conversation. Read the original article.

As Tasmania looks likely to have minority government, the Greens must decide how to play their hand

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Tasmanians Greens leader Cassy O’Connor (centre) on the hustings.
AAP/Rob Blakers

Narelle Miragliotta, Monash University

According to Tasmanian Greens leader Cassy O’Connor, “minority government is government for grown-ups”, whereas “majority government is government for vested interests, corruption and corporate deals”.

The Greens’ pitch to voters at Saturday’s Tasmanian state election is not being couched in policy terms alone. It is also based on a vision of a more desirable governing context for Tasmania. But is minority government good for the Greens?

The likelihood of minority government

There is a high probability that the Greens will get their wish and a minority government will be returned at this election.

Tasmania elects its lower house using a form of proportional representation known as the Hare-Clark system, where parties are awarded seats roughly in accordance with their levels of support within the electorate. Unless a party can win an overall majority of votes, it will not attain the necessary majority of seats to form a government in its own right.

In recent decades, the two major parties have struggled to secure governing majorities. In the eight Tasmanian elections since 1989, majority governments have been elected on only five occasions.

Read more:
Tasmanian election likely to be close, while Labor continues to lead federally

There is general agreement among commentators that a majority government at this election is far from certain. The Liberal Party attained 51.22% of the vote in 2014, and lead Labor in most polls. However, according to analysis by Ben Raue, the Liberals polled above 40% in just one of five polls held in the last year. If these figures are translated into actual votes, minority government is inevitable.

One might think that the possibility of minority government would render the major parties open to working with the Greens to form government. Yet the incumbent premier, Will Hodgman, has already declared that the Liberals “will govern alone or not at all”.

Likewise, Labor leader Rebecca White has also confirmed that her party “will not govern in minority”.

Much of this talk should be taken seriously but not literally. The major parties will be under pressure to negotiate an agreement of some description in the likely event of a hung parliament.

Any party that seeks to govern without the support of opposition forces will be perpetually at risk of defeat on the floor of the lower house. This reality is likely to weaken the resolve of even the most stubborn party leader – even more so once Governor Kate Warner makes the necessary entreaties.

However, it is not certain that the Greens will be the only parliamentary grouping in the mix to form a minority government. The most recent polling data (based on a MediaReach internal poll commissioned by the Liberal Party) has the Greens’ statewide primary vote at under 13%, which may not prove sufficient to secure the all-important “hinge seat” in each of the five multi-member electorates.

One of the particular challenges the Greens are confronting in 2018 is Labor’s capacity to outmanoeuvre them. As psephologist Kevin Bonham has observed, the Greens are being squeezed by the appeal of Labor’s “left-wing leader”.

Labor has also stolen the Greens’ thunder on the pokies issue, and its energy policy – complete with 120% renewable energy target – is likely to find favour with environmentally concerned voters.

Adding to the uncertainty is the prospect – albeit faint given recent polling – of the Jacqui Lambie Network (JLN) electing one, possibly two candidates. The JLN might make more attractive legislative partners for the major parties than the Greens.

Is minority government good for the Greens?

There is a deeper question that the Greens must ask: whether it is prudent for them to enter into any kind of formal arrangement with either major party.

There are advantages in the short term, such as policy concessions and even the possibility of executive office. But the longer-term consequences are far less clear.

Read more:
Tasmania the first test in an election-laden year

The Tasmanian Greens suffered swings against them following the three previous occasions that they entered into some form of agreement to support a minority government: -3.9% in 1992, -2.1% in 1996, and -7.8% in 2014.

Though there were unique circumstances surrounding each of these agreements, it is unclear if the benefits outweigh the costs for the Greens. One international study concluded that participation in government “is not necessarily bad for Green parties”, which falls well short of a ringing endorsement.

If, following this election, the Greens are needed to form a stable government, then the party will have to think strategically about the terms on which it does so. Is participation in executive office a higher prize than consistency of electoral performance?

The ConversationIf the Greens value the former, then securing a formal agreement is the best way forward. But if they value the latter, then a “confidence-and-supply agreement” is their best option. This would allow the Greens to demand additional parliamentary resources and to shape the fate of legislation, without having to shoulder responsibility for government failures at a critical time in the party’s development.

Narelle Miragliotta, Senior Lecturer in Australian Politics, Monash University

This article was originally published on The Conversation. Read the original article.

Strong US economy boosts Trump’s ratings, as Democrats shut down government for three days

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Before the government shutdown, Donald Trump exceeded a 40% approval rating for the first time since May 2017.
Reuters/Carlos Barria

Adrian Beaumont, University of Melbourne

On January 20, 2018, exactly one year after Donald Trump was inaugurated as president, the US government entered a partial shutdown for three days – the first shutdown since 2013. This is the second shutdown that has occurred when the same party controlled the presidency and both chambers of Congress; one agency was shut down for one day in 1980.

While Republicans hold a 51-49 majority in the Senate, it usually takes three-fifths of the Senate (60 votes) to invoke cloture and prevent filibustering of legislation. In the House of Representatives, Republicans have a 238-193 majority, and a bill that funded the government passed 230-197.

In the Senate, the same bill won the vote 50-49, but was short of the 60 votes needed for cloture. Five Democrats, all representing states Trump won by at least 18 points in 2016, voted in favour of this bill, and five Republicans voted against, though Senate Majority Leader Mitch McConnell’s “no” vote was technical, to allow him to reintroduce the same bill.

The reason Democrats denied supply was a dispute over “Dreamers” – children who came to the US illegally. Under President Barack Obama, the approximately 800,000 Dreamers were eligible for renewable two-year non-deportation periods, and work permits. Trump rescinded this program in September 2017, but Congress was given until March 2018 to legislate an alternative.

Four months since Trump’s rescission, no legislation on Dreamers has been voted on by either chamber. On January 11, Trump reportedly said “shithole countries” in reference to immigrants from Haiti and some African countries. Democrats clearly believe Trump and Republican congressional leaders will do nothing to stop the Dreamers being deported, so they blocked Supply to try to force action.

On 22 January, the shutdown ended with Democratic support after McConnell promised the Senate would vote on action for the Dreamers. However, the government’s funding expires on February 8. If McConnell fails to honour his promise, it is likely there will be another US government shutdown.

The funding bill agreed to also funded the Children’s Health Insurance Program for six years – a key Democratic priority.

Even if a bill that stopped the deportation of Dreamers passed the Senate, the House of Representatives is more difficult, as there is a large bloc of hard-right Republicans who would detest leaders bringing any pro-Dreamer legislation to a vote. Trump can veto legislation, and it requires a two-thirds majority in both chambers to override his veto.

The strong US economy has improved Trump’s ratings in the last month. According to the FiveThirtyEight poll aggregate, Trump’s ratings were 36.4% approve, 57.5% disapprove on December 16, but they are now at 39.1% approve, 55.9% disapprove.

Before the shutdown, Trump exceeded 40% approval for the first time since May 2017.

The strong US economy also appears to be helping Republicans in the race for Congress. A month ago, Democrats led Republicans by 50-37, but that advantage has shrunk to 46-39 in the FiveThirtyEight aggregate.

Republicans may also be benefiting from a lack of media focus on the controversial bills they had passed or attempted to pass, such as the corporate tax cuts or Obamacare repeal.

The shutdown was not long enough to have a large impact on Trump’s ratings or the race for Congress. According to FiveThirtyEight analyst Harry Enten, the previous two long shutdowns – in 1995-96 and 2013 – had a large negative short-term impact on the Republicans, who were blamed for both. However, once the shutdowns were resolved, voters quickly forgot about the disruption.

Midterm elections will be held this November, in which all 435 House of Representatives members and one-third of the 100 senators are up for election.

Owing to natural clustering of Democrats in cities and Republican gerrymandering, Democrats probably need a high single-figure lead on the popular vote to take control of the House of Representatives. A seven-point lead for Democrats would give Republicans some chance of retaining control.

Commissioned Tasmanian polls stronger for Liberals than December EMRS

The Tasmanian election is expected to be called soon for either March 3 or 17. Tasmania uses the Hare-Clark system for its lower house, with five five-member electorates. A December EMRS poll gave the Liberals 34%, Labor 34% and the Greens 17%.

There has been no media-commissioned polling since this poll, but the Liberals released a MediaReach poll last week that gave them 41.1%, Labor 34.3%, the Greens 12.8% and the Jacqui Lambie Network (JLN) 6.2%.

A ReachTEL poll for the left-wing Australia Institute in the seat of Bass gave the Liberals 49.4%, Labor 27.6%, the Greens 10.5% and the JLN 10.1%.

MediaReach has previously only taken polls in the Northern Territory, so it does not have a track record. ReachTEL’s Tasmanian polls were biased against Labor at the last two federal elections, but the Liberals performed better than ReachTEL expected at the 2014 state election.

Essential 53-47 to federal Labor

The first federal poll of 2018, an Essential poll, was released last week. Labor led by 53-47, unchanged from the final Essential poll of 2017 five weeks ago.

Primary votes were 38% Labor (steady), 37% Coalition (steady), 9% Greens (steady) and 6% One Nation (down one). This poll was conducted on January 11-15 from a sample of 1,038.

According to the Poll Bludger, Essential will be a fortnightly poll this year. Previously, Essential polled weekly, with a rolling two-week sample used for voting intentions.

Malcolm Turnbull’s net approval was minus seven, down four points since December. Bill Shorten’s net approval slumped to minus 17, down eight points since December.

By 44-29, voters would support Australia becoming a republic with an Australian head of state (44-30 in January 2017). By 53-38, voters would support a tax on sugar-sweetened drinks.

More than 50% thought all types of crime had increased in the last few years, including 70% who thought youth gang crime had increased, and 76% who thought drug-related crime had increased. 53% and 40% respectively thought drug crime and youth crime had increased a lot.

The ConversationI expect the first Newspoll of 2018 when federal parliament resumes in early February.

Adrian Beaumont, Honorary Associate, School of Mathematics and Statistics, University of Melbourne

This article was originally published on The Conversation. Read the original article.

As costs mount, the government should abandon the Cashless Debit Card

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The Cashless Debit Card trial disproportionately targets Indigenous people, despite what the government says.
AAP/Richard Milnes

Elise Klein, University of Melbourne

A Senate inquiry has recommended that trials of the Cashless Debit Card be continued and expanded to new sites in other states next year. This is despite Labor and Greens senators providing separate dissenting reports that rejected the recommendation that legislation for the bill should pass.

The majority report’s proposal dramatically contrasts with most of the submissions accepted by the inquiry raising significant concerns and arguing against the trials. These submissions outline a variety of serious issues that have been largely overlooked.

What is the card?

The trials for the Cashless Debit Card began in early 2016 in Ceduna, South Australia, and the East Kimberley in Western Australia.

The card quarantines 80% of social security payments received by all working-age people (between the ages of 15 and 64) in the trial sites. It attempts to restrict cash and purchases of alcohol, illegal drugs and gambling products.

The card compulsorily includes people receiving disability, parenting, carers, unemployed and youth allowance payments. People on the aged pension, on a veteran’s payment or earning a wage are not compulsorily included in the trial, but can volunteer to take part.

The issues left unanswered

The trial disproportionately targets Indigenous people, despite the government claiming the card is for both Indigenous and non-Indigenous welfare recipients. This is disingenuous, given the card was first proposed as a key recommendation in mining magnate Andrew Forrest’s Review of Indigenous Training and Employment.

This recommendation followed various other forms of income management, including a program that was part of the Northern Territory Intervention in 2007.

The Intervention required the suspension of the Racial Discrimination Act to explicitly target all Indigenous people on welfare. Concerns about human rights breaches continue, and most were overlooked by the Human Rights Joint Committee’s commentary on the Cashless Debit Card bill.

The trial of the card has increased hardship in people’s lives. This is not only because of the experiment’s disorganised and ill-conceived implementation, but also due to the trial’s design.

People are being compulsory included because there is an assumption that they engage in problematic behaviours, such as the over-consumption of alcohol, gambling, or the use of illegal drugs. But this is not the reality for most people.

Being put on the card has made people’s lives harder because limiting cash restricts people’s ability to undertake day-to-day activities to help their family’s wellbeing. This includes getting second-hand goods, paying for transport, and buying gifts.

This hardship is reflected in the final evaluation of the trial, in which 32% said their lives were worse since being on the card (only 23% said their lives were better).

Further, 48% of participants reported that the card does not help them look after their children better. This is concerning, as recently completed research into income management programs indicates a correlation with negative impacts on children – including a reduction in birth weight and school attendance.

Getting the assumptions wrong has pushed already vulnerable people into even more vulnerable situations. Medical specialists have raised concerns with the card being used to treat addiction.

Both crime and domestic assaults increased under the card in the East Kimberley. Superintendent Adams of the Kimberley Police District told the Senate inquiry that in the 12 months to June 30, 2016, there were 319 domestic assaults in Kununurra, but in the 12 months to June 30, 2017 (and the time of the trial), this figure had increased to 508.

Flawed evidence

The government used both the interim and final evaluations as key evidence to justify extending the trials.

Both evaluations have been severely criticised as being methodologically and analytically flawed: from the way interviews were conducted, to having no baseline to test government claims of success, through to an over-emphasis on anecdotal improvements and discarding important issues such as the increase in crime and domestic violence.

The decision to implement the card was not a community decision that represents the regions’ diverse interests or population. And some have had more say than others.

For example, the Miriuwung Gajerrong Corporation noted that, although the:

… Department of Social Services states that the Cashless Debit Card program was co-designed with local leaders in Kununurra … in reality, only four local leaders were consulted in relation to the introduction of the [card] in Kununurra.

Consultations themselves have not been about co-design, but have been tokenistic to convince people to support the card.

In a perverse twist, the only way people can get themselves off the trial is to get a job. Yet in both Ceduna and the East Kimberley, the biggest cause of unemployment is the lack of formal, dignified and secure jobs. Linking to unemployment, some people included in the trial are also subjected to the punitive Community Development Program. This compounds poverty, as the program’s nature induces high breaching rates.

Even if a few support the card, many more have suffered material and emotional hardship. The community has been fractured through such heavy-handed intervention. And the A$25 million spent on it has demonstrated no credible evidence of sufficient benefit to justify an ongoing rollout.

That the card continues to be pursued by government exposes its dogged obsession with implementing neocolonial and punitive policy for some imagined political gain at the expense of vulnerable people.

The ConversationThe author would like to thank professor Jon Altman and Sarouche Razi for comments on earlier drafts.

Elise Klein, Lecturer in Development Studies, University of Melbourne

This article was originally published on The Conversation. Read the original article.

Instead of rebuilding stadiums, the NSW government should focus on local sport and events

Chris Gibson, University of Wollongong

The New South Wales government’s argument for spending A$2 billion rebuilding stadiums is that Sydney is losing flagship events to other state capitals, leading to fewer tourists and less media exposure. But large investments in transportation and venues are a significant drain on the public purse, often for economic returns that rarely break even.

Our research suggests that the NSW government should invest in smaller community events and sporting organisations that make use of existing facilities. We tracked 480 community events across Australia and found that they generated A$550 million in revenue.

These events also contribute more than A$10 billion a year to their local communities, support 100,000 jobs, and help build local business networks and skills.

Parkes Elvis Festival.
John Connell and Chris Gibson (2017) Outback Elvis: The story of a festival, its fans & a town called Parkes. Sydney: NewSouth Publishing

The benefits of grassroots events

In contrast to major, one-off events that require large infrastructure and marketing budgets, there are thousands of small community events across Australia every month. Each might only attract a few hundred people, but the revenue adds up.

Places that have consciously fostered grassroots community events, such as Ballarat and Hobart, enjoy healthy visitor numbers year-round, without overwhelming the local infrastructure.

Smaller community events make good use of existing facilities such as RSL clubs, showgrounds and parks. They tend to hire labour, PA systems, portaloos and catering from the local community, keeping dollars in circulation locally.

In contrast to mega-events that subcontract management to large firms, community events integrate more participation from their local communities. This not only improves local business networks, but also enhances local skills and leadership.


The economics of large events doesn’t stack up

The evidence also overwhelmingly shows that public investment in major events isn’t worth it. Promised benefits are often exaggerated, and in the words of a recent review of the international research:

…any increased economic activity resulting from the event is routinely dwarfed by additional public budgetary commitments.

Read more: Suspended reality: the ins and outs of Rio’s Olympic bubble

Sydneysiders may have enjoyed the experience of hosting the 2000 Olympic Games, but increases in tourism and business investment failed to materialise. Rio de Janeiro is struggling with recession in the wake of its 2016 Summer Olympics. The money spent on the Olympics would probably have been better spent upgrading hospitals and other infrastructure.

This is partly why cities are backing away from hosting major sporting events. When the International Olympic Committee opened the bidding for the 2024 Summer Olympic Games, all but two cities – Paris and Los Angeles – withdrew their bids.

The fact that no other city was prepared to bid shows that the justifications for lucrative mega-events are wearing thin, both financially and politically.

Misleading numbers

The NSW government recently defended its plan to rebuild stadiums by arguing that the revenue generated by major sporting events will easily pay for itself within a few short years. Economists beg to differ.

Such estimates are typically based on conducting visitor surveys at events and asking punters to estimate their total spending. This is not good research methodology.

For one, people are consistently inaccurate at estimating their spending on the spot, only discovering the actual amount when they open their credit card statements.

It can also be hard for visitors to differentiate between money spent while at a specific event, and their spending elsewhere on their holiday.

Visitors complete surveys at the Daylesford ChillOut Festival.
Chris Gibson

We also need to subtract all of the money that would have been spent whether or not a major event takes place. This includes spending by people who live in the area, those who rescheduled travel plans to coincide with the event, and those who would have done some other activity (also known as “time-switching”) instead of going to the event.

Read more: Sydney’s stadiums debate shows sport might not be the political winner it once was

In other words, take all the Sydneysiders, casual visitors and time-switchers out of calculations of, say, weekly NRL game revenue at the Olympic or Sydney football stadia. The actual amount of “new” revenue for Sydney is much less impressive.

This is why a sober analysis of the true costs and benefits, and actual revenue numbers, are needed before governments rush to invest in major sports and event infrastructure.

The ConversationIf NSW truly wants to foster the events economy, the evidence suggests that money would be better spent on local community events and sporting organisations.

Chris Gibson, Director, UOW Global Challenges Program & Professor of Human Geography, University of Wollongong

This article was originally published on The Conversation. Read the original article.

Queensland finally has a government, but the path ahead for both major parties looks rocky

File 20171208 11331 cgymw4.jpg?ixlib=rb 1.1
This is not the clear-cut election result Annastacia Palaszczuk and Labor hoped for.
AAP/Glenn Hunt

Chris Salisbury, The University of Queensland

After going to the polls on November 25, Queenslanders finally have a state election result as Liberal National Party leader Tim Nicholls conceded defeat on Friday.

Following a four-week campaign, votes were counted for almost a fortnight until Annastacia Palaszczuk’s Labor Party was confirmed the victor. Palaszczuk is the first female premier to win back-to-back elections. In 2015, she’d become the first woman at state or federal level to lead her party to government from opposition.

But it’s not the clear-cut result Palaszczuk desired. Labor appears to have won 48 seats in the 93-member parliament to the LNP’s 39. This leaves Palaszczuk’s returned government with a slim majority and a diverse crossbench.

A complex contest

With a record field of candidates in an expanded number of electorates – many with redrawn boundaries – this shaped as a complicated election. Adding to its unpredictability was the reintroduction after 25 years of compulsory preferential voting.

Further reading: With One Nation on the march, a change to compulsory voting might backfire on Labor

While two-party-preferred swings were generally not as large as at the last two state elections, overall figures showed a fragmented statewide vote. More than 30% gave their first preferences to minor parties and independents. This exceeded the One Nation-driven protest vote in 1998.

This continues the trend of a declining primary vote for the major parties. Combined with compulsory preferencing, several electorate contests duly developed into three- or even four-horse races, extending the time needed to correctly distribute preferences and declare results. Some seats were decided only after the arrival of postal votes, up to ten days after the polling date.

Like the previous Queensland and federal elections, a close and protracted count left the government in extended caretaker mode. Voters in Queensland and the rest of Australia may need to accustom themselves to a new norm of tight, drawn-out contests, where party leaders’ election night speeches might be obsolete.

Winners and losers

Labor went into the election with a notional seat count of 48 following the redistribution. Despite a 2% decline in its statewide vote, it emerges with little change in its electoral stocks.

Gains in the state’s southeast corner at the LNP’s expense offset a few seat losses in central and north Queensland, where persistent unemployment has been a worry.

To the government’s relief, every cabinet member held their seat. Deputy Premier Jackie Trad survived one of the stronger challenges, a 10% two-party-preferred swing to the Greens in South Brisbane. Brisbane’s inner suburbs, as in other state capitals, are now highly vulnerable to a rising green tide.

The LNP suffered a negative swing of almost 8% – and even higher in parts of the southeast. High-profile casualties included shadow frontbenchers Scott Emerson, Ian Walker, Tracey Davis and Andrew Cripps in the north falling victim to erratic preference flows.

Emerson has the distinction of losing the newly created seat of Maiwar in inner Brisbane to Queensland’s first elected Greens MP, Michael Berkman.

In other firsts, Labor’s new member for Cook in far-north Queensland, Cynthia Liu, is the first Torres Strait Islander elected to any Australian parliament. Innovation Minister Leanne Enoch becomes the state’s first Indigenous MP to be returned at an election.

One Nation’s Stephen Andrew, who defeated veteran Labor MP Jim Pearce in Mirani in central Queensland, becomes the first descendent of South Sea Islander labourers to enter state parliament.

Decisive issues

Besides bread-and-butter issues of job creation, power prices and transport infrastructure, neither Palaszczuk nor Nicholls could escape the dominant themes of this election. The proposed Adani coal mine project animated voters in different parts of the state for different reasons, as did the spoiler role that Pauline Hanson’s One Nation was presumed to play.

Together, these factors reinforced an impression of “two Queenslands” in contention during the campaign.

Further reading: Adani aside, North Queensland voters care about crime and cost of living

Protests against the Adani mine’s environmental impact – and questions over its long-term economic benefit to regional communities – featured regularly once the election was called. Palaszczuk succeeded in defusing the issue to some extent early in the campaign with an abrupt declaration that she would veto federal infrastructure funding for the mine’s construction.

Further reading: Why Adani may still get its government loan

A feared backlash in places of regional discontent and high youth unemployment, like Townsville, didn’t entirely materialise, with Labor incumbents holding seats against expectations. But these concerns, in tandem with uncertainty over the Adani project, saw Labor lose Bundaberg and nearly lose the traditionally Labor-voting Rockhampton to independent candidate and former mayor Margaret Strelow.

The LNP’s position on supporting the Adani mine with public funds, and Nicholls’ prevarication over dealing with One Nation, appear to have hurt the party in Brisbane especially. But so too did Labor reminding voters of Nicholls’ role as treasurer in the Newman government.

As the election neared, Nicholls was swamped by constant questioning about cosying up to One Nation.

While always difficult to quantify, the federal Coalition government’s woes amid the same-sex marriage debate and citizenship fiasco likely did the LNP few favours.

Role of the minor parties

The Greens and One Nation capitalised on the dip in major party support, gaining significant vote shares of 10% and almost 14% respectively. However, each party won only a single seat.

Critically, both parties stripped valuable primary votes from Labor and the LNP, especially the latter’s vote in the regions. This will furrow the brows of federal Coalition MPs through this term of government. For good measure, One Nation preferences likely helped unseat some LNP MPs in the southeast.

The party’s state leader, Steve Dickson, lost out to the LNP in Buderim, while Senate outcast Malcolm Roberts didn’t present a serious threat to Labor in Ipswich.

Despite its failings, One Nation attracted more than 20% in the seats it contested and finished runner-up in two dozen of them, perhaps largely down to Hanson’s constant presence throughout the campaign.

Katter’s Australian Party (KAP), though standing candidates in only ten seats and not making much impact on the campaign, might have done best of all the minor parties. Its primary vote improved to more than 2%, gaining it another seat in Hinchinbrook on Labor and One Nation preferences.

KAP’s targeted approach might prove unwelcome news for the federal Coalition, which can expect similar levels of focused disaffection from conservative regional voters elsewhere. But a fragmenting primary vote spells trouble for all the major parties.

What next for Queensland?

Queensland now enters its first fixed-term period of government. The next election is due on October 31, 2020, with four-year terms following that.

Labor holds only 13 of 51 seats outside the Greater Brisbane area. With all seats decided, factional negotiations will now unfold to determine the make-up of Palaszczuk’s new cabinet. It’s fair to assume it will be Brisbane-centric.

With such a concentration of government MPs in the capital, Palaszczuk’s team will presumably clock up many kilometres – and spend some political capital – reassuring the regions they’re not forgotten.

In the wake of an underwhelming result for the LNP, Nicholls announced he is stepping down as party leader and won’t contest a leadership ballot early next week. The likes of David Crisafulli or Tim Mander, or potentially Deb Frecklington, loom as Nicholls’ likely successors.

Party insiders have complained that the election result proves the marriage between the formerly separate Liberal and National parties in Queensland has failed and should be broken up.

Further reading: Queensland Liberals and Nationals have long had an uneasy cohabitation, and now should consider divorce

The ConversationThe road ahead for both major parties will be anything but easy.

Chris Salisbury, Lecturer in Australian Studies, The University of Queensland

This article was originally published on The Conversation. Read the original article.

Dastyari demoted again – but government demands he leave parliament

Michelle Grattan, University of Canberra

Bill Shorten has forced Labor senator Sam Dastyari to quit as opposition deputy whip in the Senate – but the government is demanding he quits parliament over his dealings with a Chinese national of interest to Australian security agencies.

Prime Minister Malcolm Turnbull accused Dastyari of a “failure of loyalty” to Australia and said he “should get out of the Senate, full stop”.

“Dastyari has shown he does not put Australia first and he does not owe his first loyalty to Australia,” Turnbull said.

Shorten’s move against Dastyari followed the media on Wednesday revealing audio of his 2016 remarks to a local Chinese media news conference supporting China’s position in relation to the South China Sea and contradicting Labor policy.

The audio made it clear his comments were deliberate; previously he had downplayed them when a fragment was reported.

On Wednesday, it was revealed Dastyari had told business figure and political donor Huang Xiangmo that his phone was likely tapped, and they should go outside Huang’s house to have their conversation.

Dastyari has said he went to the house of Huang – who had been at his side at the news conference – to say they should not have further contact, after the controversy over money Huang provided Dastyari and the policy comments. The controversy had cost Dastyari his frontbench position.

In a statement to the Senate on Thursday morning Dastyari, who also loses his position as chairman of a Senate committee, said he had been called by Shorten on Wednesday night and “asked to resign from my position in the Labor Senate organisational leadership”.

He insisted that he had “never had a briefing by any Australian security agency ever. I’ve never passed on classified information and I’ve never been in the possession of any. As I’ve repeatedly said, if I was ever given any security advice from any agency, I would follow it to the letter.”

Dastyari said he found “the inferences that I’m anything but a patriotic Australian deeply hurtful”.

Shorten shows no sign of seeking to have Dastyari leave parliament. He could not force him to do so – all Labor could do would be to expel him from the party.

Shorten said he had not taken the decision to demote Dastyari lightly. “I told senator Dastyari that his mischaracterisation of how he came to make comments contradicting Labor policy made his position untenable.

“I also told him that while I accept his word that he never had, nor disclosed, any classified information, his handling of these matters showed a lack of judgement.

“I know that senator Dastyari will learn from this experience.”

The government is homing in particularly on Dastyari’s advice to Huang about his phone being likely tapped, and how to avoid surveillance of their conversation.

Turnbull also contrasted his behaviour with the situation of those who have had to resign because of their dual citizenship.

Senators had resigned who had no allegiance to any country other than Australia but because of a foreign law of which they weren’t aware, he said. “This is a senator who has made it abundantly clear that his first allegiance is not to Australia.”

He had taken money to pay his personal debts “from a foreign national who is very, very close indeed to a foreign government.

“Now we learn – and he has not denied it – that he has been providing counter-surveillance advice to that foreign national in order, presumably, so that what he assumed were the operations of Australia’s security agencies could be frustrated.

“Sam Dastyari has shown that he is not on Australia’s side and it’s time he got out of Australia’s parliament,” Turnbull said.

Attorney-General George Brandis told the Senate: “It is not good enough for Mr Shorten to think that he can overcome this latest embarrassment merely by, once again, temporarily benching senator Sam Dastyari.

“It is not good enough because senator Dastyari has not only compromised himself – he has compromised his office and he can no longer remain.”

The ConversationShadow Foreign Minister Penny Wong said Dastyari had done the wrong thing, but questioned how information from national security agencies had become public. She said she hoped Brandis would be “as persistent and determined to find out how that has occurred as he has to point the finger at senator Dastyari”.


Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.