Andrew Leigh

KEEPING TABS ON PRICES HAS NEVER BEEN MORE IMPORTANT

The Canberra Times, 18 August 2022

Twelve dollars for an iceberg lettuce. Eleven dollars for a punnet of strawberries. Cooking oil prices boiling over. KFC putting cabbage in its burgers. After decades of stable food prices, suddenly inflation is on the front page of the paper.

Addressing price rises involves government working with industry to fix supply chain issues, reducing the backlog in visa processing for skilled migrants, and pressing the Fair Work Commission for a pay rise for minimum-wage workers and aged care workers. The independent Reserve Bank has also raised rates to contain the demand-side pressures. Both the Reserve Bank and Treasury are currently forecasting that inflation will be back inside the target band of 2 to 3 per cent by 2024.

But if we’re to address inflation, it’s vital to understand it. In most countries, inflation is reported monthly, providing a regular update on price pressures. Of the 20 largest economies that make up the G20, Australia is the only one that doesn’t produce monthly inflation estimates. Instead, Australia produces inflation figures every three months.

CASE OF CAUSE AND EFFECT

The Daily Telegraph, 17 August 2022

In recent weeks, we’ve learned two troubling facts about young Australians: the prevalence of mental disorders has hit a new high, and the rate of volunteering has plumbed a new low.

According to the surveys, young Australians are more likely to be experiencing anxiety or depression. At the same time, this cohort is less likely to be joining with others to help their local community. With charities in desperate need of new helpers, many are pulling back from the civic work that is so vital to a strong society.

To get a sense of the scale of the problem, let’s look at the numbers.

Among young women, an extraordinary 47 per cent have experienced a mental disorder in the previous year – up from 30 per cent in 2007. Among young men, the rate of mental disorders has grown from 23 per cent to 31 per cent. Among young people, rates of depression have doubled, rates of social phobia have tripled, and rates of panic disorder have increased nearly four‑fold.

In terms of community involvement among 18‑24 year olds, the volunteering rate is now 25 per cent, down from 30 per cent in 2006. Many remarkable young Australians still give their time and energy to help out in their local community, but the net effect is that for every five young volunteers today, we would have had six young volunteers if the rate had remained as high as in 2006.

POLICY BANNING UNFAIR CONTRACTS WILL SHIELD SMES FROM EXPLOITATION

Joint opinion piece with
Julie Collins MP
Minister for Housing
Minister for Homelessness
Minister for Small Business

The Australian, 9 August 2022

The cleaning companies were multi‑billion‑dollar firms, but most of their customers were small businesses. So the big firms wrote contracts that allowed them to increase their prices. To make things worse, the contract said that if the small businesses didn’t like the price rises, they had to pay huge penalties to cancel the contract.

Small companies often lack the resources and bargaining power to negotiate terms in standard form contracts. Existing laws haven’t stopped the use of unfair terms, which are hurting small businesses across Australia.

Right now, contract terms found by a court to be unfair are unenforceable, but they’re not illegal. That’s why we’ve announced that the Albanese Government will outlaw unfair contract terms. If companies put unfair terms in their contracts and a court finds they are unfair, then they can cop a penalty from the court.

LABOR WANTS TO WORK WITH BUSINESS IN A RACE TO THE TOP

Australian Financial Review, 9 August 2022

With an area of around 700 square kilometres, Singapore is about 1/10,000th the size of Australia. Not surprisingly, it doesn’t have much of a mining industry. But starting around 2006, Singapore suddenly began to play a key role in Australian commodities exports. From 2006 to 2014, BHP sold $US210 billion worth of resources to its Singapore subsidiary. They then marked it up by 10 per cent and sold it on. The iron ore never went near Singapore – it was shipped out of Western Australia to the final buyers in Korea, China, India and Japan. Yet somehow a chunk of the profits landed in Singapore.

The creation of Singapore marketing hubs isn’t the fault of the Singaporean government, which has a long and distinguished tradition of welcoming traders and financiers from around the world. It arose because some clever accountants at BHP and Rio decided to play a thimble-and-pea trick with their profits. Some called it ‘the Singapore Sling’, but while the cocktail is a deliciously sweet gin drink, these tax tactics left a sour taste in the mouth of Australian taxpayers.

TAKING ACTION TO STOP TAX TREATY SHOPPING

The Australian, 25 July 2022

At first blush, treaty shopping might sound like a fun excursion to the gift store with your primary schooler. Yet far from being a pleasant way to spend a Sunday afternoon, treaty shopping is a worrisome lurk that undermines the tax system.

On July 20, the tax office released an alert about a high-risk activity that has been observed and will be subject to increased scrutiny: companies restructuring their tax affairs to take advantage of reduced withholding tax rates under a tax treaty in relation to royalty or dividend payments from Australia. As the it noted, such a restructure might involve creating a new entity in a favourable treaty jurisdiction, interposed between the foreign parent and the Australian operation in order to access the reduced tax rates under the tax treaty.

E&OE TRANSCRIPT

E&OE TRANSCRIPT

RADIO INTERVIEW

ABC BRISBANE DRIVE

WEDNESDAY, 29 JUNE 2022

SUBJECT: Census.

STEVE AUSTIN, HOST: What is an Australian today? What do we look like? What do we present as, given the census data? I want to do this with my guest who is, as a result of the federal election, now an Assistant Minister. Andrew Leigh is Assistant Minister for Competition, Charities and Treasury. That's not the real reason why I wanted to speak with him. He's also a prolific writer of honest and interesting books, and most recently wrote the book ‘What's the Worst That Could Happen? Existential Risk and Extreme Politics’. Andrew, thanks for joining me today. Have any of your scenarios in that book come true yet?

ASSISTANT MINISTER FOR COMPETITION, CHARITIES AND TREASURY ANDREW LEIGH: Pleasure, Steve. It’s fortunate to say that the world has not ended yet, and long may that continue.

AUSTIN: Give me your just general overview, first of all. What stands out to you? What do you think, Andrew Leigh, as someone who's got a PhD in economics and writes prolific, as a prolific book writer, what stands out to you in the census data about who we are?

LEIGH: Two big things, Steve. One is that almost half of Australians have a parent born overseas, and it really does speak to the multicultural success story that is modern Australia. The other is the significant decline in the share of Australians expressing a religious affiliation. There's now almost as many people who profess to having no religion as there are Christians in Australia. So a big change in the way in which the nation engages with religion.