Inequality: still a fair way to go, The Australian, 29 May
If you returned from work one day and found your home flooded by a gushing faucet, the first thing you’d do is turn off the tap. But once you’d stopped the water rising, could you then go about your evening as though nothing else was amiss? Only if you’re willing to overlook the rather pressing problem of everything you own being underwater.
This is the misguided approach we’ve seen recommended by some commentators recently in response to a new OECD report on inequality. The report shows that the gap between the rich and the rest has been relatively stable in Australia in the period 2006 to 2012, even as it has continued to rise in other countries like America.
Importantly though, the report also shows that Australia remains a very unequal place. On the OECD’s figures, the richest tenth of Australians now own 45 per cent of this country’s wealth. The top twentieth have nearly ten times the wealth of the typical household. There are 50 people living amongst us who together have more wealth than the poorest 2 million Australians.
Australian Bureau of Statistics figures tell a similar story. Since the mid-1970s, earnings have grown three times as fast for the top tenth than the bottom tenth. If cleaners and checkout workers had enjoyed the same percentage wage gains as surgeons and financial dealers, they would be $16,000 a year better off.
Inequality may not have risen in the six years between 2006 and 2012, but it remains a pressing problem that should concern anyone who is interested in maintaining Australia’s strong traditions of opportunity and fairness.
LAUNCH OF THE FINANCIAL SERVICES COUNCIL NATIVE TITLE STANDARD
PARLIAMENT HOUSE, CANBERRA
Thank you to Aunty Matilda House for that very fitting welcome to country, and thanks to Sally Loane and the Financial Services Council for inviting me to share in today’s launch. I acknowledge the Minister for Indigenous Affairs Nigel Scullion, and also my counterpart and occasional sparring partner, Assistant Treasurer Josh Frydenberg. All political sparring gets put aside when we come together to mark worthwhile initiatives like the one the Financial Services Council is launching today, and particularly when we do so during National Reconciliation Week.
A little while ago I was reading some research done by the Australian Institute of Aboriginal and Torres Strait Islander Studies, on the experience of Indigenous communities managing their native title rights once these have been recognised in Australian law.
ANDREW LEIGH MP
SHADOW ASSISTANT TREASURER
SHADOW MINISTER FOR COMPETITION
MEMBER FOR FRASER
ED HUSIC MP
SHADOW PARLIAMENTARY SECRETARY
TO THE SHADOW TREASURER
MEMBER FOR CHIFLEY
ENTREPRENEURS TO KEEP AN EYE ON ESS CHANGES
Labor will task our recently announced Treasurer’s Entrepreneurial Council with an ongoing responsibility to recommend improvements to the employee share scheme changes introduced in Parliament today.
Employee share schemes are a vital support for start-ups seeking to attract the best talent in their early days.
That is why in March 2014, Bill Shorten called on the Government to consider changes to the scheme to encourage entrepreneurs to do what they do best.
A true tax package would tackle profit shifting on all fronts, Australian Financial Review, Wednesday 27 May
Imagine, for a moment, that Bill Shorten had fronted up to announce Labor's multinational tax package back in March, and told the assembled media it would add a grand total of $30 million to the budget bottom line. Imagine he'd said that he hoped this figure would turn into billions, but he didn't have enough confidence in the estimates to count on more than $30 million.
If Labor had presented a package of this kind, we would have been laughed off Capital Hill, and rightly so.
RADIO NATIONAL DRIVE
TUESDAY, 26 MAY 2015
SUBJECT/S: Marriage equality; GST on sanitary items; Budget fairness
PATRICIA KARVELAS: In the studio with me I have Shadow Assistant Treasurer Andrew Leigh, representing the Labor party - hello Andrew.
SHADOW ASSISTANT TREASURER ANDREW LEIGH: G'day Patricia.
KARVELAS: And also Liberal Senator Arthur Sinodinos, welcome Senator.
SENATOR ARTHUR SINODINOS: Representing the Liberal Party.
KARVELAS: Representing the Liberal Party! Well, let's hear about that. Let's go to an issue which is just breaking. It is going wild on social media and no-doubt, I think, leading news bulletins as well: Bill Shorten wants to bring on the marriage equality debate. He is tabling his own bill in the lower house next week, bringing it on. Arthur Sinodinos, I'll start with you: does this mean that next week the Liberal party room will finally discuss this issue?
TUESDAY, 26 MAY 2015
SUBJECT/S: NATSEM modelling on Budget unfairness; Marriage equality
MARIUS BENSON: Andrew Leigh, the Prime Minister has called on Labor to release the research on which you are basing your claims that the Budget is going to damage low income families in particular. Are you prepared to release that research?
SHADOW ASSISTANT TREASURER ANDREW LEIGH: Marius, the model that we're using for this is the same model that the Government has used when it has asked NATSEM to do work for the Treasury and the Department of Social Services. It's the same model, indeed, that the Liberal Party had NATSEM use when NATSEM did work for the Liberal Party a couple of years ago, leading the PM to call them Australia's top modeller. So I'm really not sure what the puzzle is out of this. Labor has had to do this research because the Family Impact Statement that had been in the Budget going right back to Peter Costello's time was taken out of the last couple of budgets.
With taxes, we build society
Speech to the Deloitte Tax Symposium
Eight score years ago, about 45 kilometres south-west of where we meet today, people gathered for a conversation about tax. Many of the features of that conversation would be familiar to us here today. Fairness was a key theme, passions were running hot and the debate was political at its core. Not everything was the same though, at the end of my remarks we’ll conduct a civil question session, and have a chat over pastries and coffee. The earlier conversation ended quite differently, with gunfire, bayonets and the death of at least 27 people.
I’m talking of course of the Eureka Rebellion of 1854, the ground zero of Australian tax debate. The source of the anger that led to the Eureka Rebellion was the taxation of miners through a licence, levied regardless of the profitability of a claim. The licence fees were collected by an often corrupt and brutal police force, representing a government that in the view of the miners was failing to provide the infrastructure to support a booming population.
So while I’m sure that Deloitte probably had the boutique spas, fine restaurants and local wines more at the top of mind when they chose Daylesford for this conference, it is apt that we’re meeting here in the heart of the Victorian goldfields for the Deloitte tax symposium.
We’re often tempted into lazy nostalgia for an era of easy reform in Australia that never was—a wonk arcadia where tax policy is made with bipartisan support and electoral glee. It’s good to remind ourselves that tax has always been controversial and that while the dispassionate practitioners in this room might wish it were different, tax is political.
I’d like to speak briefly today about where I think tax reform is up to currently in Australia, my views on ways forward and finally an update on the opposition’s tax policy process. I’m going to keep my remarks relatively free of political commentary, but tax is inherently political. I trust you’ll understand if at times I sound a little less like the economics professor I once was, and a little more like Labor’s Shadow Assistant Treasurer.
Remarks to the 2015 NATSEM Post-Budget Forum
Parliament House, Canberra
It's a real pleasure to be here with some of my favourite economics thinkers – Michelle Grattan, Saul Eslake, Ben Phillips and Arthur Sinodinos - and at an event organised by NATSEM at the University of Canberra. Some of you may know that last year, perhaps due to an unfortunate printing error, the Family Impact Statement was left out of the Budget. That meant that we couldn't observe some of the analysis that had been possible going back to Peter Costello’s era. Fortunately, Australia had NATSEM and they were able to conduct some vital analysis on the distributional impacts of last year's budget which made up for the accidental printing error, and helped spark a national debate around fairness.
I wanted to speak firstly today about the things I like in the Budget. Given that there's no person I like more on the Coalition side than Arthur Sinodinos, it seems churlish to start a conversation about the Budget without talking about the things that I think are good in the package. There is the National Disability Insurance Scheme IT upgrade. There’s investment in the Australian Bureau of Statistics which will be going towards an IT upgrade there as well. So long as that isn't accompanied with cuts to the bureau's surveys, that will be important too. I also like the instant asset write-off. It's a policy that aims to encourage investment, recognising that what you want to do with tax cut that change behaviour is to work on the margin. We had an instant asset write-off under the previous government which was scrapped for by this government. My only concern about the new one is that it's only there for two years. What will happen when it suddenly finishes?
Why should we care about inequality?
The 2015 Economic and Social Policy Public Lecture
University of Wollongong
Dutch economist Jan Pen once suggested a simple way of visualising the extent of inequality in a society. Imagine, he suggested, a parade, in which each person’s resources were represented by their height.
Suppose we were to conduct such a parade in Australia. People of average wealth would be average height. Those with half the average wealth would be half the average height. Those with twice the average wealth would be twice the average height.
Let’s suppose the parade took an hour to pass you. What would you see?
For the first half a minute, people would be literally underground. These are the people with more debts than assets. Perhaps they are homeless, but have credit card debts. Or they are a business owner about to go bankrupt.
Then would come the little people. For the first few minutes, they are no bigger than lego figures. They might have some clothing and a television, but little else. By the ten minute mark, people are the size of a child’s doll. They might own an old car.
Twenty minutes have gone by, but still the marchers are no taller than a newborn baby. Most probably don’t have regular work – they might have odd jobs, or be reliant on the pension. Few would dream about them – or their children – breaking into the central Sydney property market.
It’s now half an hour. The watchers are getting bored. Heights aren’t rising much. Are we really only halfway through the parade?
UNIVERSITY OF WOOLONGONG
WEDNESDAY, 20 MAY 2015
SHADOW ASSISTANT TREASURER ANDREW LEIGH: I'm here with my colleagues Stephen Jones and Sharon Bird, and we've just been touring the iAccelerate building at the University of Wollongong. Learning about their programs to encourage women entrepreneurs; engaging with companies producing 3D printers and pop-up ergonomic desks and potentially game-changing medical technology. It's really impressive to see the range of technologies and the extent to which firms are looking towards the future. It's exactly that future that Bill Shorten was looking to build towards with Labor's announcements in the budget reply about investment in science, technology, engineering and maths, and supporting Australian students to learn coding. I might just throw now to my colleague Sharon Bird to make a couple more quick comments.