Andrew Leigh

This week I was fortunate enough to be invited to speak at the OECD-NBER Conference on Productivity Growth and Innovation in the Long Run in Paris. My theme was the relationship between inequality and social mobility; here's the details.

DOES TOO MUCH INEQUALITY PREVENT SOCIAL MOBILITY?

 OECD, PARIS

FRIDAY, 26 SEPTEMBER 2014

For much of the time we’ve been on the planet, humans have led a static existence. We lived where our parents lived. We did the jobs our parents did. The chances of moving up or down the ladder were limited.

 Indeed, that era was so recent that most of us still carry the mark of it. Most Anglo-Saxon surnames denote occupations (Smith, Archer, Miller) or places (Marsh, Hill, Lake), reflecting a time when few left their village or rose above their station.

 There’s nothing wrong with living in the same town as your parents, or following them into the same career. But for many of our forebears, this wasn’t a choice: it was a necessity. As recently as a few centuries ago, virtually everyone on the planet was consigned to a caste system.

 The lack of mobility wasn’t just unfair – it was extraordinarily inefficient. Imagine how many talented youngsters from poor backgrounds lived and died without a chance to use their skills. How many potential Mozarts were lost because they never got to hold an instrument? How many would-be Darwins were denied a decent schooling? How many budding Bill Gateses languished because they couldn’t get financial backing for their entrepreneurial idea?

Curtin University has just released the most comprehensive study of the Australian not-for-profit sector ever. The research tells us plenty that is useful about how the sector works. But if Kevin Andrews gets his way in scrapping the Australian Charities and Not-for-profits Commission, we'll lose that opportunity again.

MEDIA RELEASE

CHARITIES COMMISSION REVEALS MORE ABOUT NOT-FOR-PROFITS THAN EVER BEFORE

Thanks to the creation of the Australian Charities and Not-for-profits Commission, we now know that the charity sector generates income of around $100 billion a year and employs over 900,000 Australians.

These findings are detailed in the first comprehensive report on what makes Australian charities tick, released today by Curtin University.

The report was made possible because in 2013 the charities commission began collecting Annual Information Statements from every registered not-for-profit detailing their finances and operations. 

I'm looking for a full-time electorate officer to join my team, working out of my electorate office in Braddon. The job entails lots of community engagement and solving local problems. In a typical day, you might be helping someone at the front counter with a Centrelink issue, assisting with a 2000-letter mailout, or arranging a community forum at the local football club. 

Fraser is not only the most populous electorate in Australia (with around 140,000 electors), but also one of the most engaged. One of the great things about Fraser is that people are keen to write in about issues big and small, from climate change to the local postbox. But it means that I need hardworking electorate staff to manage it all. 

The electorate team consists of 4 full-timers, plus a bevy of part-timers, volunteers and interns. There's a good sense of camaraderie, and it's a great way to help the community. 

If you're interested in grassroots politics, community organising and love Canberra, this job is likely to be a good fit. It won't involve policymaking or speechwriting, but a lot of writing, problem-solving, and digital engagement. 

The current incumbent is Damien Hickman, who is off to do great things with the National Rural Health Alliance. If you have queries about the job, you can call him on 6247 4396. 

The salary range is $48,017 to $64,532 (EO-A in the parliamentary jargon). 

Applications close Sunday 28 September. If you're interested, please send a covering letter, a CV and a writing sample (100-800 words) to [email protected]. 

The OECD has released an important report on action to tackle multinational profit shifting and tax avoidance. It's a welcome step forward, but now we need the Treasurer to step up and get its recommendations delivered both in Australia and around the world.

MEDIA RELEASE

OECD TAX PLAN MEANS CRUNCH TIME FOR HOCKEY

With the release overnight of a pioneering report on tackling multinational tax avoidance, it is time for Treasurer Joe Hockey to stop talking big and start taking real action.

The report outlines the first set of concrete multilateral initiatives to block base erosion and profit shifting. It has been prepared by the Organisation for Economic Co-operation and Development in consultation with representatives of more than 110 tax jurisdictions globally.

The release of these initiatives comes ahead of the G20 Finance Ministers meeting this weekend in Cairns. At that meeting Joe Hockey will have a much-needed opportunity to show he can deliver more than rhetoric when it comes to making major companies pay their fair share of tax.

To date, the Coalition’s only real actions on this have been to walk away from closing $1.1 billion in tax loopholes, and to stall on signing Australia up to new bank transparency measures.

Today I've got an opinion piece in The Australian, supporting Chris Bowen's call for the independent Parliamentary Budget Office to be tasked with preparing budget forecasts and figures. 

The Coalition has already shown a worrying tendency to cook the nation's books, so it's time that power was taken out of the hands of governments altogether. 

Treasurer Joe Hockey trashes economic forecasts, The Australian, 16 September 

THEY called it “political monetary policy” — the tendency for interest rates to be cut in election years, fuelling a bubble that then had to be contained. In a series of important research papers in the late 1980s and early 90s, Harvard’s Alberto Alesina and co-authors showed that allowing politicians to set interest rates was causing a political business cycle.

Research such as this has underpinned the move across the developed world — including in Australia — to have interest rates set by independent central banks rather than by politicians.

Alesina argues that having an independent agency set interest rates and keep an eye on inflation brings two important benefits. First, independent central banks are less sensitive to sudden and short-term political pressures than elected governments. As a result, they tend to behave far more predictably — something that promotes economic stability. In particular, central banks have no incentive to manipulate monetary policy in the run-up to an election. They also don’t alter policy dramatically in the way that often happens after a change of government.

With news that Australian troops are headed back into Iraq, I joined Chris Hammer and Andrew Laming on Breaking Politics to talk about the humanitarian importance of their mission. Here's the transcript:

E&OE TRANSCRIPT

ONLINE INTERVIEW

FAIRFAX BREAKING POLITICS

MONDAY, 15 SEPTEMBER 2014

SUBJECT/S: Australian military involvement in Iraq; Joe Hockey dragging his feet on multinational tax avoidance; Indigenous affairs

CHRIS HAMMER: Prime Minister Tony Abbott has announced that some 600 Australian military personnel will be deployed to the Middle East as part of a coalition combating ISIL in Iraq and Syria. Joining me to discuss that and other issues is Andrew Leigh, the Labor member for Fraser here in the ACT and also the Shadow Assistant Treasurer. And from Brisbane, Andrew Laming, the Liberal MP. Andrew Laming, where are you?

ANDREW LAMING, MEMBER FOR BOWMAN: I'm in the black swamp, the home of the famous flying foxes up here in Southeast Queensland so hopefully I won't be dodging any guano by flying foxes this morning.

HAMMER: Ok, Andrew Laming to you first: Australia is deploying troops to the Middle East, what do you understand their mission is and what do you understand the timetable is?

LAMING: Well it's very clear to everyone that ISIL is an emerging threat and that standing by and doing nothing will only guarantee the further movement of this group. I think Tony Abbott is absolutely right to commit Australia to this coalition; there is a reason for joining this coalition. We have high-level partners supporting us and finally there really are no voices proposing that we do anything else. I mean to sit by and allow what we're seeing in Northern Iraq to continue, we simply cannot contemplate that.

Despite trumpeting a newfound commitment to international banking transparency in today's papers, Joe Hockey is leaving Australia to lag behind other countries on tackling multinational tax avoidance. Here's my thoughts on what he needs to do ahead of this week's G20 Finance Ministers meeting in Cairns:

MEDIA RELEASE

HOCKEY STILL HEDGING ON INTERNATIONAL BANK TRANSPARENCY 

Treasurer Joe Hockey must clarify whether Australia is joining the Early Adopter Group of nations tackling multinational profit shifting, following news he has seen sense on signing Australia up to international bank transparency measures.

After months of stalling and pussy-footing, Mr Hockey has finally confirmed that Australia will implement the Common Reporting Standard on financial account information. The standard is an important measure for cracking down on international tax avoidance. It allows authorities to automatically exchange information about the contents of company and individual bank accounts held overseas.

Labor has repeatedly called for Australia to join a group of more than 40 Early Adopter nations which will start preparations to implement the standard in 2016.

At the moment there is a public appeal underway to raise funds for a National Peacekeeping Memorial on Anzac Parade, in my electorate of Fraser. Over the weekend I was fortunate enough to join servicemen and women from across Australia at the future site of that memorial to mark the 67th anniversary of Australian peacekeeping.

MEDIA RELEASE

67th ANNIVERSARY OF AUSTRALIAN PEACEKEEPING

Today, Australians came together at the future site of the national Peacekeeping Memorial on Anzac Parade in Canberra to celebrate the servicemen and women who have helped foster peace and stability overseas.

14 September marks the 67^th anniversary of the departure of the first contingent of Australian peacekeepers.

On this date, we pay tribute to the service of the tens of thousands of Australians who have since served overseas in fragile nations like Timor-Leste, the Solomon Islands and Sudan.

As the G20 meetings in November edge closer, it's time to get serious about Australia's response to issues like multinational tax avoidance. But so far all we've seen from Treasurer Joe Hockey is empty rhetoric. In this release I argue that it's time for the Treasurer to do more than talk:

MEDIA RELEASE

HOCKEY MUST SIGN UP FOR MORE TAX TRANSPARENCY

Treasurer Joe Hockey is procrastinating and prevaricating on a key measure to stop multinational companies shifting profits offshore.

The Common Reporting Standard provides for the automatic exchange of financial account information between banks in different countries. It is designed to make it easier to track how money moves around the world so that governments can ensure companies pay their fair share of tax.

In August, over 40 countries joined an Early Adopters Group and committed to fast-tracking implementation of the standard from January 2016. Despite Treasurer Joe Hockey endorsing the standard after the G20 Finance Ministers meeting in February, our name was conspicuously absent from that list.

One of the more exciting new developments in Australian media has been the launch of The Mandarin - a news service dedicated to in-depth coverage of the Australian public sector and policy making. I recently sat down with one of their reporters, David Donaldson, for a chat about using randomised trials to help guide better policy development. Here's a summary:

The case for randomised trials in policy development, The Mandarin, 10 September

Governments should use more randomised trials in policy development, according to federal Labor frontbencher and former economics professor Andrew Leigh.

Randomised trials are used extensively in the private sector — “you are having randomised trials done on you every time you enter a supermarket or every time you use Google”, Leigh told The Mandarin at his Parliament House office recently.New South Wales has been conducting randomised trials with letters asking people to pay fines and tax, among other things, building on the work of the British government’s Behavioural Insights Unit.

A recent NSW trial found the number of citizens paying overdue land tax jumped from 27% to 39% by introducing greater personalisation and a statement that “8/10 people pay their land tax on time” in legal notices. Other trials have included six or eight possible alternatives in the layout of websites, for example, allowing exact measurements of how customers responded to the inclusion of a photo, a logo or different text.