36. Red Tape Reduction (Again)

Hi. I am Greg and I want to grumble about red tape reduction (again).

I recently grumbled about the government’s “bonfire” approach to red tape reduction, but fortunately the national charity regulator, the ACNC has been saved at least temporarily from the bonfire and there is a now a Senate Committee review.

I suspect the Committee will simply hear again that most charities like the notion of a purpose-built, independent regulator and don’t wish to be returned to the regulation by the tax collector.

But if the government really wanted to reduce red tape for the charitable sector, it would pick up recent recommendations from the Not-For-Profit Reform Working Group about changes to tax deductible gift giving.

Currently, most charities get tax basic concessions by virtue of being charities. But if you want donations to you to be tax deductible, you need a whole separate process. In many case you need to establish a separate Gift Fund in your constitution with its own bank account and management committee. And if you’re an environmental, arts or harm prevention charity you then need to apply to the relevant Minister to be placed on the appropriate register of organisations.

The Minister may sit on an application for years, or grant it as if it was a piece of political largesse for supportive charities.

However, there are also charities who are exempt from such Ministerial whim – those who because of some historical accident or political deal are listed in legislation as being deductible gift recipients.

It’s stupid and it’s dodgy.

A good piece of red-tape reduction would be to abolish the need for a separate Gift Fund and the various Registers, and repeal the separate parliamentary listings and then simply extend tax deductible gift recipient status to all charities.

This would increase donations to charities, remove the implicit notion that some charities are more worthy than others, and be a direct assistance to thousands of organisations who are doing good work in the community.

It should be simple – if you are a not-for-profit organisation with a charitable purpose, you should get all the same tax charity concessions. Full stop.

If the government is not prepared to embrace this really good piece of red tape reduction for the charitable sector, we might just begin to suspect that their red tape reduction is really about something else – which is where I finished my previous grumble.

I am Greg and I am still grumbling.

This Grumble can be heard online or by podcast.
First Broadcast: 15 April 2014

35. Age Pensions

Hi. I am Greg and I want to grumble about proposals to raise the pension age.

I am not necessarily against changing the pension age, or tightening some of the restrictions so that we are not subsidising relatively wealthy people, but it is such a mono-dimensional debate.

“Be prepared to work until your 70” the headline says – but what does it mean for people who aren’t working? We already have a real problem of mature age unemployment – people who may have worked for 30 or 40 years, but who find themselves out of work and facing age discrimination in the employment market.

Sure, if you are a CEO, an academic or a highly paid consultant there might be jobs for 60 year olds which value that lifetime of experience, but for many people, if you are made redundant or out of work in your 60s it might be near impossible to get another job.

For those people, raising the pension age is not about the inconvenience of staying in work longer, but living for longer on the much lower unemployment income support rather than getting the higher benefits of the age pension. The difference is about $120 a week in the base rate, so raising the pension age may sentence older unemployed workers to another 1, 2 or 5 years of living below the poverty line.

If we are going to have a conversation about raising the pension age, can we have a real discussion which includes:

• how we are going to change workplace cultures to provide job possibilities for older employees;
• whether we can create a part-time job pathways for older workers to ease into retirement, or to just share work more fairly; and 
• how we can index pensions so that pensioners do not begin to slip backwards relative to the rest of the population – in the same way that those on CPI-indexed benefits like Newstart and Austudy have been left behind.

And finally, if we keep people in work longer, who is going to do the vast amount of volunteer caring and community work that younger retirees do – because there is no doubt that retirees care for grandchildren, aging parents and siblings, and are the backbone of many community organisations?

These are genuinely hard issues. Much easier to just cut benefits to vulnerable people in order to fill a revenue hole at the same time as we cut mining and pollution taxes.

I am Greg and I am grumbling.


This Grumble can be heard online or by podcast.
First Broadcast: 15 April 2014

34. Taxes and GST

Hi. I am Greg and I want to grumble about taxes. It’s a familiar theme – in fact, my first Grumble here was that constantly cutting taxes erodes the revenue base and leads to cuts in vital services.

But since then the political debate has moved. The Federal Treasurer is now saying taxes will never cover projected levels of spending, the Head of Treasury is openly canvassing increasing the GST and the Governor of the Reserve has also weighed in on the tax reform.

Of course this is a bit weird when the government is pursuing the abolition of the mining super-profits tax and pushing to sell-off assets like Medibank Private – which, while boosting the coffers in the short term, would leave a revenue hole over time.

However, at least we are beginning to have a debate about how we fund services, without pretending there is a magic pudding that can provide comprehensive government services with low taxes.

But I am still grumbling because it remains an economists’ debate – devoid of analysis of power and the impacts on real people who will lose income support or services.

At least many business groups have moved on from dreams of low or no taxes and are calling for a comprehensive overhaul of the tax base. But hey surprise, they favour increasing the main tax that business doesn’t pay – the GST.

But if we were to increase the GST, who would be most affected? Generally consumption taxes impact most on the lowest income earners as a larger proportion of their household budget goes on consumption, rather than savings or investment.

However, it is not that simple.

GST revenue could be increased simply by raising the rate – say from 10% to 12%. Or it could be increased by extending the range of items it applies to. One option mooted is to extend it to health costs. This would impact disproportionately on people living with chronic health conditions, many of whom are on low incomes.

By contrast, extending the GST to education would be progressive as those who can afford private education would pay more than low income households in the public school system.

And there could be other suggestions – what about increasing the GST rate but removing it from necessities like utilities. That would ease the burden on low income households.

But I suspect that progressive tax change is still not really on the agenda.

I am Greg and I am grumbling.


This Grumble can be heard online or by podcast.
First Broadcast: 8 April 2014

33. Knights and Dames

Hi. I am Greg and I want to grumble about knights and dames. Yes, it is predictable, and in the week since Lord Abbott’s non-surprise policy, there has been much derision of the re-introduction of imperial-style honours.

And rightly so. But do such things really matter?

It is a bit pathetic, slightly embarrassing, but mostly it is just funny.

But what I actually want to grumble about is who gets the titles of Sir and Dame. Any honours, whether they are Australian or British imports, are supposed to be about recognising great service to the community, but do the retiring or incoming Governor-General really qualify?

I don’t mean personally, but I thought the position of Governor-General was itself a sort of recognition of service, and a very well paid one at that at around $400,000 per year. Do we also need to knight them?

Quentin Bryce’s career before being Governor –General included being a successful barrister, a CEO, a senior government official and Governor of Queensland. All well remunerated. Similarly, the new resident of Yarralumla has been well recognised and rewarded for his high-profile military career.

Both G-Gs have contributed community service beyond their careers, but mostly their qualification for honours are their career achievements. Well, I am sorry, that is just their day job.

Lots of people make enormous contributions in their day jobs - creating the infrastructure, goods and services that we all use, and they are rewarded and recognised far less than those most likely to be knighted.

So, if we are going to have a system of honours, could we recognise people who make a contribution to our community beyond their day job?

There is no shortage of them – volunteers who keep community groups of all sorts running; those who care for relatives, neighbours and sometimes strangers; and activists who spend their lives being ostracised for trying to make the world a better a place.

All these people give up time and money to make their contribution. No wages, no social recognition, no rent-free cottages by the lake. And no knighthoods. 

Of course sometimes these community contributors (usually the safer, more conservative ones) get minor honours, but as we have seen with our be-knighted governors-general, the big honours are reserved for those who have already been recognised and rewarded.

To those that have, shall be given. It is called a class system.

I am Greg and I am grumbling.

And vale Tony Benn – a champion, but not a knight or Lord of the realm.


This Grumble can be heard online or by podcast.
First Broadcast: 1 April 2014