Posts Tagged ‘Carbon tax’

EYE-BALL’s Herman on – Gone – Ski Part II (Gone is Gonski)

Links to Previous ‘Herman’ Posts:

– 27th June – Gone-Ski: Prime Minister Julia Gillard

– 24th June – The Ashes

– 21st June – The Senate

– 5th June – Zombies

– 1st June – Canberra – and black holes

-30th May – What is an adequate Contrition?

– 24th May – Simplex

– 19th May – The Tears of a Prime Minister

– 24th Mar – An Example of bureaucracy gone mad

– 10th Mar – The Carbon Tax – Post Election …

– 7th Mar – Wayne Swan – Please Stop

28th Feb – The Australian Labor Party View

– 6th Feb – Corruption

– 25th Jan – Anti Discrimination

– 17th Jan 2013 – Atheism

– 12th Nov – Hegemony

– 2nd Nov – A March early Federal election

To see more EYE-BALL ‘Herman’ posts:

click here …

Gone – Ski Part II (Gone is Gonski)
| Author: EYE-BALL’s Herman O’Hermitage | 5th July 2013 |
In the last week, much has unfolded. Simon Crean has announced his retirement, so has Greg Combet, Stephen Smith has taken as respectable a retirement as circumstances will allow. Federal ALP has intervened in the NSW State branch. Dead wood is being pruned. Backyard blitz takes on a new meaning.

The makeover is starting to take shape. Tony Burke attempted to resign, and his resignation was not accepted. Tanya Plibersek is still Minister for Health. Jenny Macklin is still there and ministerial positions are musical chairs (deck chairs on the Titanic). Can these weeds be realistically controlled or made useful?

What really matters is policy, and why do we forgive them now? They created this mess so why should we believe they will really fix it, can fix it.

For a start, this parliament has only run it’s course through the support of amongst others Craig Thomson. Had Thomson been forced to vacate his seat 18 months ago at a by election Dobell would have gone Coalition. Therefore Tony Abbott would be PM today. Windsor and Oakeshott both former Nationals but now independent have played their part. They are both not contesting their seats and that means a notional 76 (tiny majority) to Coalition as things stand.

Then comes the question why did Rudd not challenge sooner?

If Rudd had have stood last March, he would have had 3 months more to turn things around. As policies change, why did he leave it until there was no apparent parliamentary sittings to debate these shifts in policy. It is left to journalists to get admissions of culpability over matters like the shift in immigration?

Why is Rudd scared of the opposition on the parliamentary floor?

He keeps taunting Abbott with debate me on Prime Time TV. Abbott is saying I won’t play the game. But at some stage he needs to play the game. He needs to give the electorate time to develop belief in the team he leads.

To find any rationality in all that is now upon us we have to go back further in recent history. Exactly how Rudd was overthrown in June 2010 and what were the real motives and who were the real players?

When Rudd and Gillard first came together as a leadership team, both were considered young and neither more chance. Rudd was prepared to serve under Gillard but Rudd was the better spokesperson. The ALP was desperate to end the Howard reign. Rudd had no factional allegiances, and Gillard was all things to all people. Rudd due to his diplomatic background won over.

Roll on to November 2007, they did the unbelievable, they won. Queensland turned a narrow victory into a massive one because for the 1st time there was a Qld Prime Minister. A golden period ensued. Costello retired. Howard was defeated in his own seat. Some was attributable to Workchoices other decisions were just human frailty.

Brendan Nelson was anointed Liberal leader. He said he would have a go. There was no heir apparent beyond Costello. There was Kyoto and Sorry and Rudd was walking on water, metaphorically. Nelson called a leadership contest, he was happy to get out. The Liberal party’s electoral stocks were atrocious.

The leadership was given to Turnbull. He wasn’t ready. Then came Godwin Grech and Utegate. Turnbull had no traction. Then came Carbon Tax and Copenhagen. Abbott took over, in a contest that included Hockey. The Liberal party was happy with 2nd best.

After Copenhagen Rudd was petulant. He spat the dummy.

The fools got in the way. Rudd dropped Carbon Tax cold and switched to a mining super profits tax.  Some virtual unknown announced the coup on ABC TV by the name of Paul Howes, of the AWU. By the time that was decided Rudd was the first 1st term prime minister knifed by his own party. Gillard spoke of a good government who had lost their way.

Australia was in shock. Leaks were everywhere. All scuttlebutt. What was the truth? Arbib according to Wikileaks had been informing Washington what was really happening. Shorten and Howes were spokespersons. Richardson claimed a part, and implicated the Victorian right. All was based on gossip and leaks. The ALP went ever so close to losing the unlosable election. Gillard formed a minority government. Abbott had brought the Coalition back from the grave. Gillard show her real chameleon persona, she was simply do what it takes. In her words “the Little Doer” in public perception, power is everything. Australia gave her a very good go. Abbott acted as if he was just waiting for government to fall to the Coalition. The broken promise on Carbon Tax was just the beginning. The Coalition played it like a broken record.

The shambles that parlayed from there on in was just too hard to believe. HSU, Slipper, more broken promises, parliamentary salary increases, a budget surplus set in stone, oops an $18bn deficit, Eddie Obeid. When it was first announced on Christmas Eve that the guaranteed surplus was abandoned, because jobs matter, the death knoll had rung for the last time. Maybe not, maybe it was the NSW ICAC enquiries into Tripodi, Obeid and McDonald. Nothing will save the Gillard government. Don’t put away that gong too fast. The death knolls just get louder.

By the May Budget there was a massive disconnect. Coming from Caucus was this nonsense of a j curve. Sell our positive agenda, harp on about the Coalition negative agenda. But no one is listening.

The ALP needed desperately a circuit breaker. The only one was Rudd. Rudd the Dud according to prominent front benchers. They lined up to tell us what a dud he was in 2012. Those who spoke most freely and at length are all gone now. Those that spoke less candidly, knowing how foolish they looked, have survived, just.

Gillard had to find a way out, the ALP had to find a face saving exit. Shorten switches to the Rudd forces.

Was Rudd guaranteed an open mandate to fix the underlying issues? Please be clear on what issues.

We now wait.

Intervention in NSW ALP. ASIC claims the banks are gauging on term deposit rollover rates.

Hang on ASIC is a government agency but they have been silent for far too many years on the banks not passing on full interest rate cuts. Why is that pitched at the retiree sector rather than the mortgagee belt? Where is Glenn Stevens and the RBA or APRA. Oh investments! Australian Securities and Investments Commission!

So Rudd has got a friend, one at ASIC.

Rudd does a flying visit to Indonesia. Carbon tax moving to Emissions Trading System. Nothing is firm, not even the election date. Wow this is much more the opening lines of Macbeth than Act V Scene II.

Bubble, bubble, toil and trouble. Eye of newt & and toe of frog, Wool of bat, and tongue of dog, Adder’s fork, and blind-worm’s sting, Lizard’s leg, and howlet’s wing, For a charm of powerful trouble, Like a hell-broth boil and bubble. Double, double, toil and trouble; Fire burn and cauldron bubble. [Macbeth Act I]

What is left?

A 2nd string (journey man) Coalition leader. One that is easily labelled negative, and having little by way of policy. A closer run race where confusion reigns. He though he was MacDuff, but it was always Rudd, the understudy who was going to play the part.

Where and How will the ALP secure not only seats to counter New England and Lyne, but hold Dobell and Robertson and many many more. I can now believe that some seats like Kingsford Smith will be a stronger majority to the ALP. Garrett has gone. But winning 5 seats is different. Safe seats like Batman or Lalor, Melbourne or maybe even Denison don’t change the scenario.

They won’t. They can’t.

What will happen is that the Coalition will form government and be on the back foot from day 1. The Greens will struggle to win a senate seat but will still be the balance of power in the Upper House. Going for a double dissolution will not achieve anything. They might well lose the lot. Opposition leader Rudd could well be in a position to take back the government benches. No initiative allowing them to expunge the Carbon Tax will be possible. Only waiting until 2016 will see the Greens finished. It will be very difficult for the Coalition to make any significant difference.

The best thing about Shakespeare is that it does have an ending. How surreal!

Believing in sanity is indeed insanity.

Please – if you found this story to your liking and would like to promote it to your social media contacts – i.e. Twitter, Facebook, or other icon linked account below – please click your favoured Icon(s) to promote the story.Thankyou.

Have your say where it counts: – contact your Local Federal Representative via the links below and let them know how you feel about this, or any other topic that you feel strongly about – or you can just post a comment below and let off some steam.

Links to Australian Parliamentary Website – MP’s

EYE-BALL’s ‘Herman’ …


EYE-BALL’s Herman on – Political Double Speak

Links to Previous ‘Herman’ Posts:

– 27th June – Gone-Ski: Prime Minister Julia Gillard

– 24th June – The Ashes

– 21st June – The Senate

– 5th June – Zombies

– 1st June – Canberra – and black holes

-30th May – What is an adequate Contrition?

– 24th May – Simplex

– 19th May – The Tears of a Prime Minister

– 24th Mar – An Example of bureaucracy gone mad

– 10th Mar – The Carbon Tax – Post Election …

– 7th Mar – Wayne Swan – Please Stop

28th Feb – The Australian Labor Party View

– 6th Feb – Corruption

– 25th Jan – Anti Discrimination

– 17th Jan 2013 – Atheism

– 12th Nov – Hegemony

– 2nd Nov – A March early Federal election

To see more EYE-BALL ‘Herman’ posts:

click here …

– Political Double Speak –
| Author: EYE-BALL’s Herman O’Hermitage | 28th June 2013 |

hile the dogs may have been called off on Wednesday and tethered or kennelled on Wednesday night, newly installed PM Rudd would do very well to remember what he has been forced to endure during his hiatus.

On Yom Kippur;

Those of the Jewish faith, rarely vote in person on polling day at a polling station. Saturday is their Sabbath. They can and do vote postal, or pre poll. Postal and pre poll numbers grow at every election. In this modern era of communication most people do not understand why voting takes place only on the Saturday, and do not understand why fines are issued when you fail to vote. Many believe getting your name marked off and going to a cardboard screen and using a blunt pencil to mark a valid voting paper is not just archaic it is beyond pre historic. There are so many diverse opinions, it is hard to condense, but those of the Jewish faith routinely vote pre poll or postal. So do many others.

The AEC makes extraordinary accommodations to attempt to uphold compulsory voting. You might find the occasional officer who takes himself just a little too seriously. For every one of those you will also find one equally lackadaisical.

The real reason you intend to re address September 14 as polling day is because you intend to get as much mileage from G20 in Moscow on September 7th as is possible, and ideally you would return from Moscow to conduct the official launch of the ALP election launch thereafter.

Nothing has changed. On September 21 football finals are at fever pitch. September 28 is worse. On October 5th you not only encounter football finals (NRL) but long weekend in NSW (Labour Day) and Sydney spring carnival horse racing. Any date after that means the scheduled sitting of Parliament in late August will proceed due to the fact that the electoral writs have not been issued.

This comes back to going to the polls in August. The electoral writs need 32 (or 33) days. You want to be in Moscow on September 7th and not let Tony Abbott have that honour. If you go in August can you guarantee that? August 3rd means you need to dissolve parliament by July 1st. By Monday you will not be ready. How many weeks do you need to get ready? Hmmm?

We are watching you clearly. We know you and the way you work.

On Electricity, Gas, GST and Carbon Tax.

David Murray said the Carbon Tax was an extremely inefficient tax. I cite him as a respected business leader. I absolutely agree.

Too many have forgotten, that GST was applied to electricity and gas in 2001 while not on water and other domestic services such as rates to address the concept of externalities (pollution). No steps were taken at that time with those revenues to force cleaner energy.

GST applies to domestic and commercial vehicles. In petrol there is double edged sword in the petrol excise.

A small part of domestic budget stress comes from electricity and gas prices. There are other factors. It also manifests in industrial competitiveness. There should be a proper rationalisation.

Tony Abbott has promised to not only remove the carbon tax, but have a white paper on tax reform, and move Deregulation out of Finance and put it into Department of Prime Minister and Cabinet. To say that the coalition does not have clearly elucidated policies is a furphy. It is more than that, it borders on contempt. We are sick and tired of being told what to think.

On the Australian Dollar;

The very core of this issue is the inflation target of the RBA. It is always in the too hard basket.

In the SPC Ardmona v tinned tomatoes dispute, we are now starting to address tariffs and restrictions again. In the J R Simplot talk of closing canneries in Tasmania the issues are similar. It keeps going, education sector decimated (foreign students), tourism at a competitive disadvantage. Shell closing first Clyde then any thoughts over Geelong. Caltex at Kurnell then at Lytton. Ford and more. Bonds closing manufacturing in Australia. Target and Rivers buying in Bangladesh without any conscience. We the consumer not caring nor knowing what we are buying. Labelling.

SPC is owned by Coca-cola. Simplot is American, must I go on.

Why is it mandatory for Australian commercial TV to have local content? That extends to BHP Billiton, or Rio.

Why are we subsidising production of petrol cars when we export so much gas.


Cut the double speak. As a child I always laughed in westerns when apache accused white man of speaking with a forked tongue. We are sick of being the play thing of foreign interests, and government being complicit. Ignorance or apathy or base stupidity.

Why are 2,000,000 Australian not participating in employment sufficiently? They are unemployed, not participating or want more hours.

Basic truth is a very rare commodity. We all must play our part, and our leaders must play their part.

Believing in sanity is indeed insanity.

Please – if you found this story to your liking and would like to promote it to your social media contacts – i.e. Twitter, Facebook, or other icon linked account below – please click your favoured Icon(s) to promote the story.Thankyou.

Have your say where it counts: – contact your Local Federal Representative via the links below and let them know how you feel about this, or any other topic that you feel strongly about – or you can just post a comment below and let off some steam.

Links to Australian Parliamentary Website – MP’s

EYE-BALL’s ‘Herman’ …

EYE-BALL’s Guru on – Wayne Swan’s “Treasury Mistakes” – The Evidence of Incompetence – a Ponzi expert in the making.

May 12, 2013 6 comments
Latest GURU Posts:

– 10th May – Wayne Swan’s “Treasury Mistakes” – A Follow-Up

– 29th Apr – Wayne Swan’s “Treasury Mistakes” – Heads must roll – Swan and Bradbury must accept responsibility’ –

– 23rd Apr – Wayne Swan’s – “Investment pipeline” – disappearing before his eyes – where does he go for his next ‘bunny excuse’ –

– 21st Apr – Wayne Swan’s legitimacy – He Says … ‘high A$ causes $7.5b hole since Oct ’12’ – He’s a unique type of idiot  –

– 14th Apr – The Debt Clock ticks … Tic Toc … – Gillard just spent another $3,000 – counting the real cost of this ALP Disaster –

– 5th Apr – Superannuation 2013-14 –  the Government’s new Slush Fund – Proposed Changes show SWAN and SHORTEN’s stupidity –

– 4th Apr – Australia’s Parliamentary Remunerations –
– Part III – Superannuation – The Future Fund –

– 3rd Apr – Government not happy about its tax collect – Claims Tax Minimisation deserves ‘Naming and Shaming’ –

– 31st Mar – The Cyprus Bail-out

– 31st Mar – Australia’s Debt – and the idiots Managing the Treasury –

– 20th Feb – Australia’s Parliamentary Remunerations – Part II – Entitlements and Allowances –

– 13th Feb – Australia’s Public Sector Remunerations Part I – Parliamentarians “Base-Salary” and “Additional” entitlements –

– 31st Jan – The Devil is in the Detail, there is none – Gillard chooses shock, awe & Spin over Policy –

– 23rd Jan – The Turmoil is Already here – We just have to accept what is coming –

– 22nd Jan – The Turmoil is beginning – Japan’s Economic Stimulus to tip the scales –

To see more GURU posts: – click here …

– Wayne Swan’s – “Treasury Mistakes” –
– The Evidence of Incompetence –
– A Ponzi expert in the making –

| Author: EYE-BALL Guru | 12th May 2013 |
Link to all Post in Series:

This post has been edited 13th May 2013.

The RBA produce a spreadsheet of Federal Budget expenditures and revenues  on both a monthly, and annual basis.  Link to these spreadsheets provided here.

Extensive extraction of the data allows a full disclosure of the 2012-13 Swan budget.  That research is further produced below.

Financial analysts working for media outlets have the same information as do the countless Bank and other Financial Institution Economists.  These ‘plebs’ or would be discoverers number crunch every day looking for the dark holes in financial reports.

The Federal Budget is the biggest game in town – and yet the void of challengers prepared to call Treasurer Swan out as fraud and liar number so few.

The collective voice has been to allow the Government to sell its ‘revenue write-down’ message whilst those who would and should oppose appear content.

As with the 2013-14 and every other Budget before, Journalists are locked away in the days before the Budget speech with their expert number crunchers and given free rein to do their analysis ahead of the Treasurer speech.

Nobody pays any attention to the full Financial statements – all the attention is on the cash flows and the bottom headline line number outlining whether it be a surplus or deficit.   The tweaks within the budget impacting taxpayer ‘gives and takes’ are the other half of the story.

This author has skills in this type of research and the data represented hereto is an honest appraisal of the facts available, and with the use of some basic logic, and applying some human instinct, and behavioural expectations, the summaries and outcomes made hereto have foundation.

Up first – Treasurer Swan deliberately mislead the House in his 2012-13 Budget forecasts.   He stood and announced a set of numbers he knew to be false – i.e. revenue expectations, and all to a purpose to allow the Government to live the fantasy they delivered on the 2010 promised budget surplus for 2012-13.  The House jeered Mr Swan when he made his speech – see YouTube link here.

Treasurer Swan gave an increased revenue forecast of 11.23% over the previous years than unconfirmed growth of 9.11%.   The 2010-11 forecast number was an overreach as well missing its target by some $12 billion – see Revenues Table below.

Trend growth before these numbers and since 1997 was 6.6%.   Why would Mr Swan predict revenue growth year on year above a 15 year average trend growth?

The only other time since 2000 where revenues have increased anywhere near or above the forecast 9.11% predicted in 2011-12, happened in Howard’s term during 2005-06 when the forecast was 10.48%, and again in 2007-08 when it was almost 27%.

That 27% remains double any previous years best performance.  See link here to see Table to prove these numbers.

New Revenue and Expenditure Tables below compare ‘actuals’ and ‘forecast’ budget numbers.


[Note – the 2012-13 ‘Actual’ number – i.e. $17,000 – is derived from Finance Minister Penny Wong’s statement during last week that the budget revenues will be down by $17 billion. This has been taken at face value and used to provide a 2012-13 number for the series.]

This Table presents Forecast Budget Revenues as declared every May for the following Financial year, and then measures that forecast against the actual reported result.  These results report from 2001.

As can be seen, under Howard revenues always exceeded forecast, but under Labor, revenue forecast always exceeded actuals except for the 2009-10 year.

In fact – during the Howard years the forecast verses actual provided windfall revenues of $88.8 billion from 2001 to 2008.  Yet – the ALP record since 2009 shows revenue shortfalls in the same context of  $59.2 billion.

Swan has overestimated revenues every Budget he has delivered and wants us all to believe the 2012-13 failed surplus is yet again because of revenue writedowns because of the high $A and the effects of the GFC.

Mr Swan excels in his magicians ‘rabbits in a hat’ and ‘jokers’ he pulls from his deck of card trick.  He often confuses himself with his interchangeable reasoning.


Under this ‘Expenditure’ Table extraction – both Howard and the ALP Government’s allowed actual expenditures to exceed their forecast values.

In Howard’s era from 2001 the total spend excess value was $56.7 billion, and under the ALP since 2009 the value is $46.5 billion to the end of the 2012 year.  The 2012-13 number is not available but according to announcements, it is expected to be near forecast values.

The Carbon and Mineral Rent Resources Taxes:

Carbon Tax:

The Carbon Tax came into law as the Clean Energy Future Legislation in Dec 2011.   See Legislation link here

This new Tax had the following agenda – and as paste from – [Note … this resource has publicly advised that it is closing down and all links used from the source will be broken.  In that light, the text in the above link is pasted below. The media statement referred to is no longer available on the Greg Combet Media Release statement library.]

Carbon Tax Legislation Becomes Law Dec 09, 2011

Royal Assent has been given to the Gillard government’s Clean Energy Future legislation.

The legislation, a package of 21 bills, introduces a carbon tax and associated measures.

Text of media release from Treasurer Wayne Swan, Climate Change Minister Greg Combet, and Families Minister Jenny Macklin:

Clean Energy Reforms Receive Royal Assent

The Gillard Government welcome the Royal Assent of a further 21 bills of the Clean Energy Future Legislative Package and the proclamation of their commencement dates.

The completion of this process means that the Government has the central legislative pieces in place to deliver a clean energy future for Australia.

The Clean Energy Act 2011, Clean Energy (Household Assistance Amendments) Act 2011, Steel Transformation Plan Act 2011 and Australian Renewable Energy Agency Act 2011 and 17 related bills have all now received Royal Assent.

The Carbon Farming Initiative and Australian National Registry of Emissions Units commenced operation yesterday, after those acts received Royal Assent in September of this year.

The administrative provisions of the Clean Energy Act 2011 will commence on 2 April 2012, meaning that the Clean Energy Regulator can start operations to prepare for the introduction of the carbon price on 1 July 2012.

These laws will drive a fundamental transformation of the Australian economy and provide support to low and middle income households as we cut pollution and continue to grow our economy.

With the formal commencement of the national registry, Carbon Farming Initiative and the certainty provided by these acts, clean energy investment and the further development of carbon markets in Australia can begin in earnest.

Australia’s Clean Energy laws will deliver the following:

  • A carbon price of $23 per tonne will apply to around 500 of the nation’s biggest polluters from 1 July 2012;
  • The carbon price will transition to a flexible price cap-and-trade emissions trading scheme on 1 July 2015, linking Australia to international carbon markets;
  • The tax free threshold from 1 July 2012 will be tripled from $6,000 to $18,200, freeing up to a million people from having to lodge a tax return;
  • There will be payment increases for pensioners, equivalent to a 1.7 per cent increase in the maximum rate of the pension. There will also be similar increased payments for other government payment recipients, including eligible families, self-funded retirees, students and job-seekers. These payments will total around $7 billion in the period to 1 July 2015;
  • The Jobs and Competitiveness Program will support our emissions-intensive trade-exposed industries and help them to reduce their carbon and energy intensity;
  • The $300 million Steel Transformation Plan will support our steel industry;
  • The Energy Security Fund will provide assistance to the most emissions-intensive coal-fired generators, support energy security and help transition to cleaner energy;
  • An independent Climate Change Authority will be established on 1 July 2012 to advise on pollution caps and climate change policies, taking into account Australia’s legislated reduction target of 80 per cent below 2000 levels by 2050.

These measures will drive substantial reductions in the carbon pollution of the sectors they cover. The Government expects reductions by 2050 of 90 per cent of expected waste emissions, 76 per cent of expected electricity emissions, 62 per cent of expected fugitive emissions and 53 per cent of expected industrial process emissions.

The first household assistance payments will be made in May and June 2012, to help households get ready for the modest impact of a carbon price.

The initial Clean Energy regulations covering the landfill waste prescribed distance and applications for the Energy Security Fund have now been made.

The provisions of the Climate Change Authority Act 2011 to formally establish the Land Sector Carbon and Biodiversity Board commenced today.

In 2012, the Government will add the Clean Energy Finance Corporation (CEFC) to this legislative framework. The $10 billion CEFC will invest in commercialising clean energy projects, unlocking significant new private investment in renewable energy, low pollution and energy efficiency technologies.

… can still be read on-line at: Wayne Swan’s Media Release library

Noise … Noise … Noise …

You read the ‘Clean Energy’ promised spends right … Greg Combet believed in everything he was saying on that night and would never have entertained a view would turn out to be mostly fairy tales, all made up to sell a new tax to create a revenue illusion.  A tax that has no direct benefit in the global warming hoax,  a tax that was hatched on the back of the alarmist theory to the global climate change phenomena engulfing the globe.

Combet is now knee-deep in his own ICAC inquiry into his relationship to disgraced former NSW Resource Minister Ian MacDonald.   Combet’s demons are coming back to haunt him.  see story here …

The forecast Carbon Tax  revenues were estimated as: Source linked here

  • 2012-13 = $4.010 billion
  • 2013-14 = $6.640 billion
  • 2014-15 = $7.340 billion
  • 2015-16 = $6.750 billion

The forecast revenues from the Carbon Tax across the forward estimates amount to almost $21 billion from 2013-14.   Mr Swan is now using these numbers to justify revenue writedowns across the forward estimates.   Talk about floating a boat …

The forecast MRRT and PRRT revenues i.e. Resources Rent taxes were estimated as:  Source linked here

  • 2011-12 = $1.463 billion
  • 2012-13 = $5.400 billion – MRRT commenced.
  • 2013-14 = $6.400 billion
  • 2014-15 = $5.630 billion
  • 2015-16 = $6.620 billion

These forecast revenues from the Rent Resources taxes across the forward estimates amount to almost $18.5 billion from 2013-14.

Combined with the Carbon Tax forward estimates, this makes a total of $40 billion of lost revenue across the forward estimates.   That represents 50% of the $80 billion Mr Swan claims has gone missing across the forward estimates.

Can it be said that the forward estimates were inflated in the first place?

That Mr Swan was creating a false set of numbers so he could deliver a promised budget surplus?

And if that be so – that then leads to the allegations that Mr Swan mislead the House on Budget night in his Budget estimates and deliberately so… the only other explanation can be that gross incompetence was involved – and yet he is still the Treasurer.

The Carbon emissions trading scheme was to be introduced with a floor carbon price of $23/tonne.  In the last week Combet announced the abolishment of the promised tax concession worth $1.4 billion that came attached to this scheme.  Link to media release

All the future promises made as outlined in the Clean Energy Bill media released published above are all now doubtful, with exceptions for those already paid, and/or already locked into future benefits payments.

With all the ‘mendacious’ pomp and ceremony Combet used to promote the Carbon Tax and its Emissions Trading scheme, and the ‘mud-in-you-eye’ slurs aimed at the Opposition, will Combet now eat his ‘humble-pie’ and line up for the free shots aimed at him?

Budget Forecasts:

Let’s face it – crystal ball forecasting is all Treasury estimates can offer given the global economic turmoil we and the rest of the world are dealing with.

That is not to diminish the Government’s responsibility in any way to deliver honest Governance.  How dare they hide behind what they do not know.

If the future is uncertain on any scale where revenues are circumspect, surely the prudent and responsible thing to do is the practice restraint and try to encourage the same with the electorate.   You do remember the 40% pay increases the Federal Government all voted themselves after Gillard ousted Rudd in 2010?

Previously Rudd had imposed a freeze on Parliamentary pay increases.

Decades of Government’s getting into power based of election promises and once there,  applying a different set of policies and rules to stay in Government is the cause of the GFC in the first place.

Prime Ministers come and go as do Treasurers and the like, their mistakes remain for the next lot to fix and the likes of Gillard and Swan get to walk off into the sunset on lifetime pensions we can only dream about.

If the Government were to have the same accounting and prudential standards as public listed companies, and the electorate were the shareholders, the shareholders would have receive no dividends since Labor took office.  In addition they would have had to top up their shareholdings with new equity to cover the ‘deficit(s)’ and the new debt created  as a result.

Under Howard’s 11 years in office – those same shareholders would have received dividends each and every year.

This is the measurement of the competence of this ALP Government in a business like assessments.  They SUCK!!! 

In fact – the laws Swan and his minions have broken in corporate fraud terms would see them off to serve some serious time.   The reality – $300 billion of gross incompetence … that’s 300 times what Madoff ripped from his clients.

Many of the projected offsets from the Carbon Tax have been implemented before the revenues came home or were verified.

The same with the MRRT and as those mistakes came home to roost, and became a reality for Gillard and Swan to deal with, all that could be done was to inflate the revenue numbers as a fraud to cover up the broken promise of a budget surplus for 2012-13.

Those who understood what was afoot mostly stayed silent or were no heard, and that would have included many Treasury bureaucrats who were a part of the number output.  They would have known every time Swan fronted the media he told porkies, as did every other Minister, MP, and Senator trying to sell Swan’s fanciful reasoning about revenue writedowns.

Technically – to say there were revenue shortfalls as measured against the forecast revenues is correct – but in the context of a larger responsibility, a forecast revenue inflated so as to justify expenditures, and election promises,  is as big a fraud as there is.   Swan has facilitated a climate where they have run the Nation into the ground with expenditures they knew could not be paid for from existing revenue collections.


See ‘Guide to MRRT’ published by Hawker Britton here.

Treasurer Swan and his fellow Ministers have presented the shortfall in tax collections from the MRRT as a result of an economic slowdown.  He claims that the tax is a ‘profits based tax’ and that the mining industry is facing harder times then the Government expected.


The MRRT was a tax grab to fund expenditures – the States own the mining royalties and the Federal Government wanted a slice of the pie.   There is still a legal challenge before the High Court on the validity of the MRRT and whether it has purchase up against the States constitutional entitlements.

The forward estimates from this Tax have been shown to be a sham from the first quarter collect in Sept 2012.   Already this year,  [2012-13] the shortfall looks like being $2-3 billion against the budget estimates.

It has been revealed that to placate the Mining Industry campaign against MRRT mark 1 under Rudd, Gillard used the issue to oust Rudd and did a deal with the miners that made the tax collect impotent.   It was doomed by the Legislation from the outset yet the Government kept the forward estimates in place.

What would be the Government’s Motives to lie:

The revenue table above proves that the ALP have overstated their budget and forward estimates well above trend growth of 6.6% for the period 1996-2008.

The reasons are obvious – from 2010 Gillard and Swan made promises about returning the budget to surplus by 2012-13, and when the new Carbon and MRR taxes failed to provide the forecast buffer revenues needed to fulfil those promises – they had to make a decision to either come clean about the promised 2012-13 surplus, or fudge the revenue numbers to create the illusion of a budget surplus.

This is evidence by the increased revenue forecast growth year on year from 2011-12 at 8.74%, itself well above the trend growth of 6.6%, to 11.23% for 2012-13.   With this growth forecast, Swan was able to announce the small $1.5 billion surplus in May ’12.

That decision created a fraud about the budget revenue position and the Government used this lie to cover its promised budget surplus for 2012-13.  It was a fraud upon the Australian people.  That fraud is still on-going today and more will be added on Tuesday during Treasurer Swan’s 2013-14 Budget speech.

Some further evidence to support this theory is provided below.

The 2012-13 Budget Speech May 2012:linked here

Spending Savings:

A headline feature in Swan’s Budget preamble for the 2012-13 Budget was a forecast savings in expenditures across the forward estimates.  The chart used to highlight these savings in the Budget Papers appears below:

The commentary produced with this chart can be read in full here – but states in part:

Targeted spending cuts

In returning to surplus the Government has ensured the budget is in good shape over the long term while maintaining our commitment to fairness and improving skills, health and education services.

Ensuring balance

We are returning the budget to surplus through targeted spending cuts, which retain fairness, place the budget on firmer ground and achieve better value for taxpayers’ money.

Over $33.6 billion in saves have been identified in this Budget with less than half being tax. This builds on the over $100 billion of savings we identified over the last four Budgets.

In making these decisions we have applied our core values of protecting the most vulnerable in our community and the frontline services Australian families rely on.

We remain committed to providing the skills for tomorrow’s workforce and continuing to improve our health and education systems.

By focusing on fairness and value for money the Government has been able to prioritise spending to people most in need… continues …

Nothing in this statement makes any sense when comparisons with the forecast numbers produced in the 2012-13 budget are analysed.

If Mr Swan claims to have made $33.6 billion in saves … would that not generate an expenditure downgrade of a similar amount in the forward estimates?

The forecast expenditure growth for 2012-13 over the 2011-12 Financial years only reduced by 0.39%, or $1.466 billion.  That would mean that after having trimmed/identified $33.6 billion in savings, the Government went and spend all but $1.466 billion on other new policy initiatives.

What creditability can Swan claim after finding savings but decided to spend it elsewhere?

2012-13 Budget Overview:  linked here

This Overview is 40 odd pages of expenditure highlights and one or two pages of revenue explanations – a summary where revenues have been tweaked to pay for the expenditures.

This again provides evidence that Government’s focus is all on the expenditures trying to sell the electorate about the extra ‘goodies’ they will receive in their pay packets.

The ‘bad’ news in how those ‘goodies’ are to be paid for is something all Government’s want to play down.  This is the politics and as a factor in any equation, the factor used is what makes the formula look good or bad.

In this instance that factor used is the propaganda and it has become of greater importance than any reality attached to the hard numbers.

Tax Revenue as a % of GDP:

In the 2012-13 budget papers a chart was used to show Australia’s low rate of tax revenues to GDP ratio.  Linked here …

The linked chart appears below: – [click to enlarge in a new window.]

What the chart does not tell you is that all State and Local taxes imposed in this Nation are not included in this chart, a propaganda mis-direction that works every time because nobody asked the questions.  See reference here …

Nobody is ever going to paint themselves or use data that portrays them in a bad light.  One has to go looking for the mistakes, the holes, the cover-ups and that is what our Media are charged with.

We are a Nation of blind idiots and continue to accept what our Leaders tell us all the time.   Those who should know better have become apathetic to their responsibilities. This allows the likes of Swan and Bradbury to roll out their agendarised version of what the Government wants us to believe.

We deserve every thing that a Government does during its term in office – when is the watchdog watching the watchdog, who in turn is also watching the watchdog so to speak, going to expose the truth.

GDP Growth:

Another angle or perspective is to look at long-term GDP growth – see chart pack below – Source Trading Economics[click on charts to enlarge in a new window.]

Between the 1990 figure of $305 billion, and the 2004 number of $455 billion, we see a growth rate of near 50% over 15 years.   By comparison, we’ve seen GDP grow to $1.37 billion by 2012 according to ‘Trading Economics’ updates, and we know that the RBA has the GDP number at $1.45 billion at the end of 2012, that represents some 300% growth in the last 8 years.   That growth had to come from somewhere!!!

The only economic events of importance during that 2005-2013 period were the continuing resources boom, the GFC, and the stimulus supplied by the Federal Government post GFC.  Look to the growth acceleration post 2008 when the Governments stimulus started.

On this basis alone – it can be argued that this GDP growth as another example of how Government spending influences crucial and relevant economic indicators.

By comparison, the USA and other Trading partner GDP growth rates for the same period are exemplified in the following chart pack:



About the only Nation with a similar chart structure, if not the same growth percentages.

The UK:



By far a chart with extraordinary growth numbers. No wonder Australia survived the GFC and then that poses the question – why the continued stimulus spend into 2010 and beyond?


These comparisons re all Northern Hemisphere verses Southern hemisphere, and explain the reasons how Australia survived the GFC – China’s growth alone provided us with GFC insulation.

No other western Nation has GDP growth like Australia and it is hard to fault the Government on that point.

Given the cost of the high A$ and its impact on revenues and economic downturns in all Industry, jobs, and infrastructure, where does one look to find reasons for the exponential GDP growth?

It can only be Government debt induced – and that is not what an economist would call genuine growth.

Inflation Index:

It’s been a long-held belief that the ‘inflation’ index as used to spike annual Government budgets,  is also used to ensure the economy moves forward in GDP terms.

Yet the inflation CPI index is the barometer used to measure the strength of the economy and what feeds from that drives every other economic indicator.

In other words it’s a ‘loop’ equation, without one i.e. the positive CPI – the economy would stall and all Government revenues would also stall and fall away – commonly referred to as ‘deflation’…

All commerce is a supply and demand equation – inflation indexing just gives the right to increase as a part of the loop equation.  If supply is abundant you would think prices would come down – this happens in produce in seasonal terms, yet in Labour terms when unemployment grows, the response should be cheaper labour costs.

When Government services are cut and staff laid off, those staff without jobs would surely work for the Government at a lesser cost then the staff who were not laid off.  This should bring wage cost dow in a true and free market.  But – the Unions enter the equation here and in coming years you can expect immense pressures on wage costs as Australia’s competitiveness with the rest of the world erodes further – another by-product of the high A$ policy.

The point being – the inflation index is not a true nor realistic economic indicator in free market terms.  Yet – the Government’s use of it to frame year on year Departmental Budgets creates the illusion they have to increase budgets, pensions, and the like in tandem to the CPI increases.

This view is truly a black and white view and not so much applicable or tried in any modern economy.     Modern economics is in disarray because of the GFC and its destruction to forecast modeling.

If the revenue side of Governments budget is derived from a multiplier of the targeted inflation forecasts,  then again multiplied out across the forward estimates using a variable multiplier, how can a forecast be treated with any accuracy?

Any public listed Company, or medium to small business who produced budgets like this would have their shareholders and Bankers sacking CEO’s and the Board.

Revenues are where all profit based business’ operate from.  Why is it different for Governments?

Opposition Creditability:

The research on display hereto is available to anyone interested in exposing Swan’s Budget lies, and to that point, why is the Opposition spokesperson Joe Hockey,  unable to land any real blows against Swan.

Me thinks that the Opposition Treasury understanding and knowledge base is challenged in theory and conditioned by the same Treasury modelling in trying to find real fault with Swan and his Treasury performance.

It might be because they don’t what to discredit Swan too early before the election and let some new Treasurer they don’t know run the show – hardly.

I can advise the Opposition there is nobody on the ALP side who could do the job, and if Swan is the best of them,  Australia deserves everything Swan leaves as an aftertaste when he exits.

Best Treasurer in the World – ha … a gong awarded by overseas investors who have had their siphon hoses plugged into Australia’s wealth for the last 10 years.

Swan lives in a fantasy land:

Swan gave an interview with Laurie Oakes Sunday morning.  That interview can be read in full here… and in part Swan responded as pasted below:


But a year ago you budgeted for a surplus of $1.5 billion.


That’s right.


Now wwe are now facing a massive deficit, rather than a surplus. The Fin Review says $17 billion. Is that close?


Certainly $17 billion [write-down] in 2012-13, and the nature of the revenue write-downs do spread across the forward estimates. But I was faced with a choice, the government was faced with a choice. We could turn around in the face of those revenue write-downs and cut to the bone, slash spending right now and hit jobs, and push up unemployment. Or, stand up and explain to the Australian people that our number one priority is to support jobs and growth, and that’s what I’m doing…


Just about everybody said a year ago that you were mad, that you couldn’t achieve it.


I’m sorry, that’s not right. There is no credible economic forecaster who predicted this nature of revenue write-down for this year, or across the revenue estimates. Can I just explain why? What we have had happen in our economy in the last three quarters of last year is that nominal GDP growth for the first time in 50 years has fallen below real GDP growth [for three quarters]. We also had a situation where the Australian dollar remained high, when the price of our exports fell – something that has never happened before. The combination of those factors is what has hit all of the profit-based taxes in our revenue lines, and are resulting in these revenue write-downs. And Laurie, that wasn’t predicted by any serious economic forecaster last year.


Joe Hockey predicted it.


Well Joe Hockey’s always always out there preaching doom and gloom…


He’s been proved right.


No, he hasn’t been proven right. Our economy is among the strongest in the developed world. But what has happened in the past year is that our revenues have been hit. The responsible course of action when faced with that is to support gobs and growth. So I stood up last December and said it would be unlikely that we would come back to surplus in 2012-13. At that stage, the revenue write-down from the mid-year budget update of $4 billion had been achieved over the first four months of the financial year. And as we’ve gone through this year, the revenue write-downs have got larger and larger, and at every stage of that process I’ve informed the Australian people about what has been happening, and I have taken the responsible course. I’ll take my medicine; I’ll accept the politics of this are very uncomfortable. But getting the big economic decisions right to support Australian jobs is what people expect of me, no matter how uncomfortable that is politically.

… continues …

Oakes nailed him, skinned him, all but pissed on him … and Swan sat there and kept telling lies … and they say there is no crime in a Politician telling a little white lie …  Oakes … you are over and need to get a new gig …


To offer up some mitigation – Gillard and Swan did try to plug the revenue gap with the Carbon and MRR Taxes.   Neither came near forecast predictions and are now in tatters with the collapse of the Carbon Price in Europe, and the end to the mining boom from Australia’s perspective upon us.

Swan and the Treasury should have known tax collections would be down after the GFC because of the equity and other GFC writedowns carried forward.  Also the property investor with negative gearing assets has been able to offset their payee tax with property writedowns because of the lackluster property markets.

All the revenue forecasts took none of the GFC aftermath into account. That is all on Swan.

Next Tuesday 14th May ’13 is Budget night and Swan will put on his magicians cloak yet again and try to mesmerize Australia with his own brand of magic numbers.

Unfortunately – this little Aussie battler will have to be content with throwing rotten tomatoes at the TV because he can’t be at Parliament House to do it personally from the public gallery.

Believe what Mr Swan has to say at your peril …

Please – if you found this story to your liking and would like to promote it to your social media contacts – i.e. Twitter, Facebook, or other icon linked account below – please click your favoured Icon(s) to promote the story.  Thank you

Have your say where it counts: – contact your Local Federal Representative via the links below and let them know how you feel about this, or any other topic that you feel strongly about – or you can just post a comment below and let off some steam.

The EYE-BALL Guru …

EYE-BALL’s Guru on – Wayne Swan’s “Treasury Mistakes” – A Follow-Up –

May 10, 2013 6 comments
Latest GURU Posts:

– 29th Apr – Wayne Swan’s “Treasury Mistakes” – Heads must roll – Swan and Bradbury must accept responsibility’ –

– 23rd Apr – Wayne Swan’s – “Investment pipeline” – disappearing before his eyes – where does he go for his next ‘bunny excuse’ –

– 21st Apr – Wayne Swan’s legitimacy – He Says … ‘high A$ causes $7.5b hole since Oct ’12’ – He’s a unique type of idiot  –

– 14th Apr – The Debt Clock ticks … Tic Toc … – Gillard just spent another $3,000 – counting the real cost of this ALP Disaster –

– 5th Apr – Superannuation 2013-14 –  the Government’s new Slush Fund – Proposed Changes show SWAN and SHORTEN’s stupidity –

– 4th Apr – Australia’s Parliamentary Remunerations –
– Part III – Superannuation – The Future Fund –

– 3rd Apr – Government not happy about its tax collect – Claims Tax Minimisation deserves ‘Naming and Shaming’ –

– 31st Mar – The Cyprus Bail-out

– 31st Mar – Australia’s Debt – and the idiots Managing the Treasury –

– 20th Feb – Australia’s Parliamentary Remunerations – Part II – Entitlements and Allowances –

– 13th Feb – Australia’s Public Sector Remunerations Part I – Parliamentarians “Base-Salary” and “Additional” entitlements –

– 31st Jan – The Devil is in the Detail, there is none – Gillard chooses shock, awe & Spin over Policy –

– 23rd Jan – The Turmoil is Already here – We just have to accept what is coming –

– 22nd Jan – The Turmoil is beginning – Japan’s Economic Stimulus to tip the scales –

To see more GURU posts: – click here …

– Wayne Swan’s “Treasury Mistakes” –
– A Follow-Up –
| Author: EYE-BALL Guru | 10th May 2013 |
Link to Previous Post in Series:

The media cycle has become polarised around the ‘BUDGET’ black-hole … and the Government’s inability to sell the message that it is not to blame.

Common … nominal GDP verses real GDP … we’ll get to that a bit later …

Then there was the ‘Citizen John’ example Gillard used in her own budget write-down explanation whilst trying to sell another Government mis-direction.

When stupidity and ignorance combined it makes for a special kind of dumb.  Gillard, Swan and all the other Team Gillard neanderthals have constantly shown their preponderance to change their stories to suit the moment.

Australian’s are not buying the excuses for the revenue shortfalls – and they have every right to think that way.  Everybody is looking at this from the wrong angle – the Government has been selling the message that it is revenue writedowns as the reason for the widening deficit.  Every economist out there has happily jumped on board and supported the claims with facts against forecasts and actuals.

If they were good at their job rather than follow the scent laid down by the Government, if they had a ‘light-bulb’ moment and look at the flip side, a place the Government does not want anyone poking around – you will see where the carnage really is.

The Table and Chart presented in the previous post, and again displayed hereto – shows the expenditure growth from 2007-8 and paints a clear picture of how the Rudd and then Gillard Government went on their spending sprees.

[Click on Image below to enlarge Table and Chart in a new window.  The 2013 figures are from latest estimates.]

It’s quite simple really – Rudd came to power in late 2007 – and the 2007-08 budget set under Costello was on target for a monster surplus.   That surplus ended up being $28 billion – by far the largest surplus of any Government in Australia’s history.

From that $28 billion surplus in ’07 – ’08, to a $32 billion deficit in ’08 – ’09 is some sort of crazy madhouse spending spree.  This was still Rudd and we know about GFC educed:

  1. the ‘School Building program’,
  2. the ‘Pink Bats’,
  3. the $1000 cash handout just before Xmas 2009 to all pension recipients, and then there was the,
  4. the second $1000 cash handout to families a few months later.

To get your head around a $60 billion single year increased spend:

  • the total Defence budget has averaged $15 billion per year since 1996 –
  • the total Education yearly spend average over that same 17 years is $17.5 Billion,
  • Health has averaged $36 billion, and
  • Welfare averaged $84 billion since 1996 and the 2009 spend was $124 billion – an increase of $27 billion over the 2008 number.

This was in the middle of a GFC panic and it was global – some four years later the Central Banks spend has proved crippling to all across the Nth hemisphere – Australia claims to have escaped the worst and that optimism is about to crumble.

Rudd’s GFC panic has amounted to short-term gain for a long term pain.  Whatever Rudd’s agenda was to reign in the budget spend was superceded when he was booted in a night of back room deals and Union movement and all to a plan.

Gillard’s appointment gave he and her backers the socialist platform and the stage from where they could execute their agenda.  The spending would not stop and the evidence is there.

To placate alarmist economists the 2012-13 budget was promised to be in surplus and still the new policies and their expenditure rolled out.  Nobody minded because Gillard sounded sincere about the surplus budget in 12-13 … and it was so up until Dec ’12 when the Government came clean and announced it was abandoning its surplus target.   That surplus has now been revise several times i.e.

  1. Nov ’12 from 1.5 billion surplus to $.5 billion surplus,
  2. Dec ’12 from a small surplus to a small deficit,
  3. Feb ’13 due to revenue writedowns looking like a $5 billion deficit,
  4. Apr ’13 due to further revenue writedowns it looks like being $12 billion,
  5. May ’13 revised again when Finance Minister announced that writedowns now look like being $17 billion.

The true is they have no idea … they have put in place irreversible policy spending and the revenues have increased well above trend/average as the table above shows – but the problem the forward estimates created has come back to haunt Gillard, Swan and the Gillard sideshow of Ministers.

None of them can explain because none of then knew from the outset how bad a Treasurer Wayne Swan really was.   Spending is easy when all you have to do is ask … is just plain crazy to believe that in a GFC impacted world  – finding new revenues to fund new spending will happen without cuts in other areas and restraint.

The writedowns from the equity markets since 2008, the property market flatline,  the interest returns in a low-interest rate environment,  whoever did the forecast numbers on forward estimates for:

  • corporate tax revenues,
  • the property negative gearing impact,
  • the increased pension payouts to self funded retirees when their investment income fell off a cliff,
  • the high A$ impact on tourism, trade, manufacturing, retail, agriculture, mining, and
  • the increased subsidies – i.e. the car manufacturing industry

… had to have some idea what was going to happen.

These writedowns should have been obvious to Treasury, the RBA, and Government advisors in economic terms, and the advice would have been given up the chain.

The issue then becomes why did the Government and its policy advisors ignore the obvious downstream impact issues that would arise if they continued with their spending programs?

There was a magnificent opportunity offered up when the A$ v US$ fell from parity to below A$0.50c in the turmoil of the GFC in late 2008 and early 2009.  This happened as off-shore investors pulling their funds out because they saw the end of the resource ‘cash and carry’ trade.

A decision was made then and there that off-shore capital was more important to the Nation than a devalued currency.   Having got the monkey off our backs in that A$ sell-down,  the RBA and Swan invited the carpetbaggers to hop on board again, and that saw the A$ rise just as quickly, retracing all it’s lost value and more within the next 8 months.

Glen Stevens has to wear the ‘dunce-hat’ on this one along with Wayne Swan – why did the Government allow the off-shore investors to return without a levy?

They should have known what a high A$ would mean in terms of long-term trade and labour costs, and was the reason why the Australia’s resources had lifted the value of the currency in the first place.

This mistake has cost the Nation A$trillion’s in lost trade, industry, labour force, and other domestic revenues, and will continue to harm all Australian industry well into the future as we will continue to export jobs offshore.

We are not in the same position as Spain, Greece or any other members of the P.I.G.S – but give us time.

Our real unemployment number is well above 10%, and perhaps as high as 20% if the measure was against those seeking full-time work.  The 960k jobs Swan boasts about having created is made up of near 55% part-time jobs … see Guru post here – the table data to prove these facts is reproduced at right – [click to enlarge.]

The boasts about our 5.5% unemployment is really ‘sock-in-mouth’ stuff … why highlight a weakness and promote it as a strength.   For many years long-term unemployed have been shifted off the number and parked in some other category … the ABS numbers come from sampling and have done so for many years.  If anyone understands the sampling methodology then you know that the error margin in regional areas is very high.

This all gets us to the Welfare spend – the ‘third-rail’ of all politics – you ride it at your own peril as President Jed Bartlett put it – [West Wing] …

Yet a most interesting stat revealed has the ALP government Welfare spending reduced signficantly as a % spend of all expenditures – look at the Welfare spent Chart at right to get an appreciation of the difference – [again – click to enlarge.]

Crazy to believe right – how can an ALP Government spend less on Welfare than Howard did?

To get to that answer,  the Budget Accounts requires a lot more research.  Where else could the Rudd/Gillard tenure spending be hidden in the accounts … that and more information will be forthcoming in another post.  Now to the nominal GDP verses real GDP explanation.

Nominal GDP v Real GDP:

Who out there understands Treasurer Swan when he gets a ‘gimmick’ study from his Treasury baboons to explain away the point he is trying to make. read what Wikipedia has to say about Nominal GDP

Nominal GDP and adjustments to GDP

The raw GDP figure as given by the equations linked here is called the nominal, historical, or current, GDP.

When one compares GDP figures from one year to another, it is desirable to compensate for changes in the value of money – i.e., for the effects of inflation or deflation. To make it more meaningful for year-to-year comparisons, it may be multiplied by the ratio between the value of money in the year the GDP was measured and the value of money in a base year. For example, suppose a country’s GDP in 1990 was $100 million and its GDP in 2000 was $300 million. Suppose also that inflation had halved the value of its currency over that period. To meaningfully compare its GDP in 2000 to its GDP in 1990, we could multiply the GDP in 2000 by one-half, to make it relative to 1990 as a base year. The result would be that the GDP in 2000 equals $300 million × one-half = $150 million, in 1990 monetary terms. We would see that the country’s GDP had realistically increased 50 percent over that period, not 200 percent, as it might appear from the raw GDP data. The GDP adjusted for changes in money value in this way is called the real, or constant, GDP.

The factor used to convert GDP from current to constant values in this way is called the GDP deflator. Unlike consumer price index, which measures inflation or deflation in the price of household consumer goods, the GDP deflator measures changes in the prices of all domestically produced goods and services in an economy including investment goods and government services, as well as household consumption goods.

Constant-GDP figures allow us to calculate a GDP growth rate, which indicates how much a country’s production has increased (or decreased, if the growth rate is negative) compared to the previous year.

Real GDP growth rate for year n = [(Real GDP in year n) − (Real GDP in year n − 1)] / (Real GDP in year n − 1)

Another thing that it may be desirable to account for is population growth. If a country’s GDP doubled over a certain period, but its population tripled, the increase in GDP may not mean that the standard of living increased for the country’s residents; the average person in the country is producing less than they were before. Per-capita GDP is a measure to account for population growth.

Here is a YouTube clip to help you understand –

In Principal it’s part of a card shuffle number crunchers use to confuse the audience when numbers don’t give you the answer you want.

This was Wayne Swan’s explanation … [the GDP explanation begins near the 5min 30sec mark.]

I counted 50+ outright lies Swan told to cover his mistakes and incompetence. The lies are subjective if we use the ‘nominal’ verses ‘real’ argument …

Blaming the high A$:

Swan uses the high A$ value as a reason for revenue writedowns – yet the A$ has been well – some 40%-50% above its mean average – [A$0.75c v US$] since the float in 1983. No Government has used the value of the A$v as a reason previously – yet it has been at these levels for over 10 years … it is desperate in the extreme to blame revenues when they have actually grown at 7%+ in 2012-13 and above trend of 6% since 1996. The 2012-13 forecast revenue growth at 25% to cover the expenditure that had to be funded to allow the Government to bring its forecast budget surplus in when they announced the 1012-13 budget in May ’12.

Blaming the Treasury Forecasts:

Yes – that’s right – the Government knew in May ’12 that it was selling a budget that misrepresented the facts. The Nov ’12 review revised it ever so slightly – and four months later is was a $12 billion budget hole, and now it is a $17 billion budget hole.

Treasury don’t make these mistakes – or are we to believe that the $11 billion black hole they found in the Coalition’s 2010 election policy initiative might have been equally wrong. It raises more questions then it answers.

Are the Treasury ALP stooges … are they prepared to ‘cook’ the books for political outcomes?

Truly legitimate questions now that the modeling used to predict the surplus has proved to be so horribly wrong.

No matter who the Government, i.e. Swan, Wong, Bradbury, and any other MInister or spokesperson sent out to sell and gift the media the next story in this crumbling facade – the reality is that Government’s lock in spending via policy’s they make to win elections.  Been happening for 40 plus years.

The revenue side of the equation comes after the fact and if they screw-up the economy then we get to where we are now.

The high A$ has cost Australia $trillion’s in trade, revenue, GDP growth, and many other connective opportunities over the last 10 years or so … yet no one thought to think about currency intervention to protect the economy – hell they still think it is wrong to do so despite RBA Governor Glen Stevens comments made when he announced the .25% interest rate reduction this week – see comments here.

For the educated observer and some who understands logical argument – Swan has no creditability, nor any entitlement to be a Treasurer.   His baboons beneath him are appointed on the basis that are not allowed to be any smarter than Wayne Swan.  In fact that type of hiring mentality is across all the public service hiring policy.  It’s the reason the asylum has been taken over by nutjobs – nobody has a clue from the top down.

Abbott and Hockey have their work cut out because in matters of finance – they hold no better credentials that Swan or any other of the current bushranger pack.

You have to be able to trust the Treasury modeling if in fact it is not doctored for political outcomes.  For Treasury to have got it so wrong creates a smell that just won’t do away.

Was Gillard’s forcefulness and commitment to her agenda of spending – when stacked up against a choice for the bureaucrats to either do what I tell you to do, or find another job, the reason they are being blamed for getting it so wrong?

Support argument comes in the fact that the Public Service offers very generous perks and the like – and rather than lose those benefits, senior bureaucrats and the like shut their mouths and do as they are told.

It would seem that integrity, or the standing up for what you believe in is no longer regarded as a personal quality required to work in Government anymore.

Another piece of advice for Mr Abbott – sack every Department head and three rungs down when you take office – hire people from the private sector on MP parliamentary ‘base salary’ levels and offer a bonus to those who get the job done.   Use the – ‘Serve your Country’, or ‘your Country needs you’ motif to sucker some high flyers in to give back.   I don’t see it happening – but you can only try to improve the collective brain value of so-called experts in the Treasury.

The next Guru post will be about the Budget Expenditure breakdowns …

Please – if you found this story to your liking and would like to promote it to your social media contacts – i.e. Twitter, Facebook, or other icon linked account below – please click your favoured Icon(s) to promote the story.  Thank you

Have your say where it counts: – contact your Local Federal Representative via the links below and let them know how you feel about this, or any other topic that you feel strongly about – or you can just post a comment below and let off some steam.

The EYE-BALL Guru …

EYE-BALL’s Guru on – Wayne Swan’s “Treasury Mistakes” – Heads must roll – Swan and Bradbury must accept responsibility’ –

April 29, 2013 3 comments
Latest GURU Posts:

– 23rd Apr – Wayne Swan’s – “Investment pipeline” – disappearing before his eyes – where does he go for his next ‘bunny excuse’ –

– 21st Apr – Wayne Swan’s legitimacy – He Says … ‘high A$ causes $7.5b hole since Oct ’12’ – He’s a unique type of idiot  –

– 14th Apr – The Debt Clock ticks … Tic Toc … – Gillard just spent another $3,000 – counting the real cost of this ALP Disaster –

– 5th Apr – Superannuation 2013-14 –  the Government’s new Slush Fund – Proposed Changes show SWAN and SHORTEN’s stupidity –

– 4th Apr – Australia’s Parliamentary Remunerations –
– Part III – Superannuation – The Future Fund –

– 3rd Apr – Government not happy about its tax collect – Claims Tax Minimisation deserves ‘Naming and Shaming’ –

– 31st Mar – The Cyprus Bail-out

– 31st Mar – Australia’s Debt – and the idiots Managing the Treasury –

– 20th Feb – Australia’s Parliamentary Remunerations – Part II – Entitlements and Allowances –

– 13th Feb – Australia’s Public Sector Remunerations Part I – Parliamentarians “Base-Salary” and “Additional” entitlements –

– 31st Jan – The Devil is in the Detail, there is none – Gillard chooses shock, awe & Spin over Policy –

– 23rd Jan – The Turmoil is Already here – We just have to accept what is coming –

– 22nd Jan – The Turmoil is beginning – Japan’s Economic Stimulus to tip the scales –

To see more GURU posts: – click here …

– Wayne Swan’s “Treasury Mistakes” –
– Heads must roll –
– Gillard, Swan and Bradbury must accept responsibility’ –
| Author: EYE-BALL Guru | 29th Apr 2013 |
We all remember the emphasis Swan and the rest of the Government placed on “Jobs – Jobs – Jobs” in the 2009+ era.

The Government made a conscious decision in the aftermath of the GFC and took liberty with fiscal policy and used employment as the trigger to allow themselves to let debt escalate.

The Nation has not arrived at it’s current financial abyss without a collective brain’s trust failing.

Working in the background feeding the Budget forward estimates up the ladder to their political masters are the Treasury bureaucrats and their yuppy underlings – all with starts in their eyes and willing to do the bidding of any taskmaster.

The question has to be asked about in the way these subordinates go about their business and do their best for the Nation – which came first – ‘the chicken of the egg’.

This is the crux – who feeds the pony?

Do the bureaucrats have a responsibility to the Nation that separates them from the political will of their masters – or do they protect their careers and appease the political masters at the expense of the Nation – The forward estimates have been way off target for years … who fudged the forward estimates based on a dodgy MRRT revenue expectation?   Who relented under Gillards pressure to spend her way to her own agenda?

Politicians formulate policy and throw the ball to the Treasury to find ways to fund and cost the policies and deliver accurate forward estimates.  It is only then that a Government should consider the policy and its impact on the economy.  The question is not whether the Treasury fudges the forward estimates to give the Government the news it wants to hear – it’s about Treasury staff being incompetent to understand the modern variations of economic measurements and not understanding the MRRT policy impact, or the Carbon Tax forecast against a carbon price underpinned by the European carbon price.

Sadly – this Gillard led Government has had stars in it eyes from the get-go … Gillard was in a rush as all Labor Government’s tend to be.   Gillard had the Rudd GFC response to build upon and she and Swan continued to use the GFC excuse to push new expenditure policies believing the Debt/GDP ratio comparisons allowed Australia to continue with the spending.

History has now shown us that that spending was not needed as China handed Australia an economic lifeline.  If the truth be told – Australia’s GFC fallout was postponed and awaits us downstream.   China will not be there to bail us out a second time as resources are now off the boil and aplenty, other Nations are coming on stream and are much more competitive than Australia – China will do what is best for China.

The $300 billion debt created by successive ALP Government’s since 2009 have fueled GDP growth and propped up the private sector. The single reason for Australia’s uncompetitiveness has been the continue lack of response for the RBA and Government to enact measures to weaken the high A$.   So much so that the damage done to our export industries has been by and large overlooked.

The high A$ is the sole reason  for our nightmare if anyone is looking for a pivot.  Swan thinks it a good thing, but then he does not understand the $trillions of lost export revenue over the last 10 odd years.

This single offset to what should have been Australia’s most profitable mining boom was diminished because the rest of the world invested in Australia and took all those profits offshore.   Only idiots could allow this to happen and Howard and Costello were equally ignorant of the undercurrent happening in global investment from the early 2000’s.

Treasury and RBA are the most to blame because they serve all Masters – they should have been advising and readjusting the forward estimates on growth and reduced export earnings all as a result of the hig A$.   They were grossly incompetent and deserve every criticism they have coming their way.

Treasury created a complete misread on revenues and expenditures right across all the forward estimates.  The Government also allowed itself to use it’s own policy expectations of forecast revenues from the ‘Carbon Tax’ and the ‘MRRT’ to hedge their bets on continued spending for their new policies.

In real terms – the Government spent before it could confirm the tax collect.  This was a decision Gillard and Swan made as a collective to initiate policy’s that would paint them in a better light.  Gillard gambled again and has been caught out – just as she has gambled on the AWU scandal never coming back to haunt her.

Since that abandonment in Dec ’12 – the excuse used has been reduced revenues.  Any economist or financial commentator can used the budget numbers and extract the hard data and disprove this Government excuse.  See the table and chart below to help … or click here to see Table and Chart in a new window now.

In recent weeks Swan tried to change the excuse – he changed the message and it became about the high A$ and its direct responsibility on the revenues.  This was a more plausible argument and should have been where Swan and Bradbury and all the other Cabinet minions went with their message last December.  But alas it did not gain traction and the original ‘revenue writedowns’ has again be installed as the excuse message.

Confirmation of this came overnight when the Government leaked there has been a $12 billion ‘black-hole’ caused by revenue writedowns.  Hockey explained later that the $39 billion increased revenue over and above the 2011-12 number will now be a $27 billion increase – still an increase of 7.6% and well ahead of the average year on year increase in revenues since 1996-97.

This leak followed up by an official media address is a deliberate and well-tried strategy to soften the media and electorate.  We can expect more of this in the lead up to the budget speech due in a fortnight [14th May].   The tactic is predictable – if its bad news – deliver it in small doses, if its is good news – do it with panache and flash …

A full text of Gillards speech today is produced below: [critiqued with Guru comments …]

MON 29 APRIL 2013

Prime Minister, Canberra


It’s a great sign of the growing recognition of Per Capita’s work that your Executive Director David has been in such good company at the international Policy Network’s Progressive Governance and Global Progress conference in Denmark.

Congratulations to you on the fine contribution Per Capita is making in the world of ideas.

With the Federal Budget just fifteen days away, I thank you for this opportunity to share with you the clearest possible picture of the purpose and context of our Budget deliberations.  … bullshitttttt …

This year’s Budget will be about a national challenge – and a national plan.

A challenge for Australia: to respond to the huge reductions in revenue growth over the next four years.

A plan for Australia: to make necessary investments in the nation’s future, to ensure that none of our people is left behind.

Tuesday 14 May will be no old-fashioned pre-election Budget night.

What the Treasurer will deliver will not be a political pamphlet – he will outline an economic program.

The Budget will outline the fiscal path for the coming four years, one designed both to take account of the nation’s current circumstances and to shape the nation’s future.   … we heard this three years ago predicting a surplus in 2012-13 …

Our key long term objective, the progressive purpose of this Government’s fiscal policy is enduring.

It is:

  • to maximise jobs and economic growth;
  • to ensure sustainable funding over the long-term for the investments that strengthen our economy and the services our whole community relies on; and
  • to keep inflation in check and give the Reserve Bank maximum opportunity to keep interest rates low.

The Government’s medium-term fiscal strategy – to deliver fiscal surpluses on average over the economic cycle – is designed to give effect to this purpose in practice.

It commits us to support jobs and economic growth when private sector demand is weak.

This is what we did so successfully during the Global Financial Crisis and, as a result, we kept around 200 000 more Australians in work. … bullshitttttt …

It commits us to making Budget decisions so that in the good times and the hard times, through the inevitable variations in economic activity and Government revenue from year to year, we can afford the investments and services that make our nation stronger, smarter and fairer.

It also ensures that we don’t simply “chase revenue down” – we don’t cut to the bone and spurn wise investments, damaging jobs and growth now and in the future.

Instead our fiscal strategy responds to the economic cycle.  … bullshitttttt …

In the language of economists, we allow the Budget’s automatic stabilisers to do their work as well as actively controlling spending to reach surplus at the right part of the economic cycle.  … don’t use terms you don’t understand … it makes you look more stupid …

That means for the coming Budget, we must fund new initiatives by making savings.

This is a necessary discipline.  … it would be a better discipline if you stopped spending …

This need for balance over the cycle has been summed up nicely by the Treasurer many times: if we are Keynesians on the way down, we have to be Keynesians on the way up – Keynesians right through the economic cycle.

The need to understand how the cycle is changing is summed up best in the remark so famously attributed to Keynes himself:

“When the facts change, I change my mind – what do you do, sir?”  … a comment for all people who can’t keep a promise … and misused in this context …

In the face of the challenges we now face as a nation, this is what any smart leader, any forward-looking government, must be prepared to do. ... smart leader … you oversell yourself …

So today I want to set out the facts that underpin the decisions our nation faces as we approach this year’s Budget.

First, the good news, the shared achievement that we should never take for granted.

Unlike so many nations, Australia’s economy is stable and resilient. … bullshittttttt … three years after your 2010 forecast – your predictions for the future are as poor now as they were then …

Our economic fundamentals are sound. … bullshittttttt … the high A$ has killed our competitiveness and in the next two years the reality of our high labour costs will cost 10,000’s jobs.

We have contained inflation, low interest rates, low public debt.  … bullshittttttt … the rest of the world have has 0% interest rates and inflation has not impacted – why do we have a 3% higher interest rate differential with the rest of the world … interest rates could be 2% lower and there would be no impact in inflation … the RBA are stuck in a late 80’s early 90’s inflation mentality – the world has moved on … the RBA have not …

We are one of only eight nations in the world to have a triple-A rating with a stable outlook from all three major ratings agencies – something Australia has never previously achieved. … not because we are getting better, but because the others are failing the benchmark tests and we are headed that way as well …

Our economy is now more than thirteen per cent larger than it was in December 2007.  …. when a Governemnt spends $300 billion growth in the economy can not truly be measured … this number is misleading on a grand scale … and cannot be used to accredit the Government with economic growth …

We have bounced back from the Global Financial Crisis better than any major advanced economy.  … no-no-no … China saved us …we did nothing but ship the resources whilst others purchased A$’s and transferred wealth offshore …

If we had made the wrong decisions during the Global Financial Crisis our nation could easily be struggling with recession today.   … you made several … currency, trade, interest rate policy, inflation targeting, bank guarantees, industry subsidies targeted wrongly and so on …

Instead, Australia is now the twelfth-largest economy in the world – when Labor came to Government we were fifteenth.  … this is a cheap grab and total crap … attrition does us nobody any good in the end …

Unlike the rest of the world, we have very modest debt – because we have borrowed in the right way and at the right time, to support growth during the global financial crisis.   … subjective … and what happens when our GFC does hit …

Our level of debt is the same as a person earning $100,000 a year with a $10,000 mortgage.

Millions of Australians with mortgages and personal loans would love to be in a position where their only debt was equal to ten per cent of their income.

Similarly, countries around the world would love to be in Australia’s debt position and have an unemployment rate as low as ours.   … amounts to spitting in the eye of those less fortunate than ourselves … when our once only resources are done and gone … what will save us then …

Indeed, the fundamental proof of our resilience is our ability to create and support jobs.

Since 2007, we have created almost 900 000 jobs in this country, in a period when twenty eight million new people joined the jobless queues world-wide.   … now this is provable … 500,000 of that 900,000 figure are part-time jobs … see here ..

Our national prospects in the Asian Century are bright.

As the centre of global economic gravity shifts east, it shifts towards Australia.

Our diplomatic and trade successes in China last month, our improved relationship with India, our strengthening economic ties with Indonesia and our flourishing alliance with the United States – these are all proof that our plan to be one of the winners in the Asian Century is bearing fruit.

However – and this is key – while Australia is stable, resilient and close to centres of growth, the wider world economy is quite a different story.

There is serious, persistent weakness in global growth – and continued volatility in the global economy.

To take one example, a resource-rich nation like Canada has only grown by five per cent in total over the last five years.

The advanced economies grew at only 1.2 per cent last year and global growth reached only around 3 per cent.

This global weakness creates important economic pressures in Australia.

The contrast between our stability and resilience and the volatility and fragility of so much of the rest of the world is a reason for the continuing strength of the Australian dollar –consider this.

Today over 30 central banks around the world hold Australian currency in their reserves. … this is nothing to brag about as the returns on those investments harm us and benefits them …

The increasing importance of our currency for central bank reserves worldwide is recognised by the International Monetary Fund.  … this is ego stuff and underpins just how much Swan and his goons don’t understand …

Later this year, the IMF will begin quarterly reporting on central bank holdings of seven currencies and the Australian dollar will be one of them.

This shows we are a great investment, but that comes at a price.

The dollar’s strength puts pressures on our economy, particularly our trade-exposed industries.   … what a trade-off … prosperity for Australians in lieu of a stake at the world table where MP’s and diplomat’s can party all night on the taxpayers dime …

It would be irresponsible simply to wait in hope for these pressures to ease.

So the Government has a plan to create and support jobs, based on our five pillars of productivity, designed to seize the opportunities that proximity to Asia creates.

This back drop to our Budget decision making – Australia’s resilience, global weakness, a persistently high dollar – have been known for some time.

What is new is how strong the revenue pressures on the nation’s Budget are.

We must plan for these strengthening pressures – and that is a key part of preparing our Budget for this year.

The persistent high dollar, as well as squeezing exporting jobs, also squeezes the profits of exporting firms: with lower profits for these companies comes lower company tax going to Government.

We can’t assume this will change soon.

The high dollar is also placing competitive pressures on firms here, who face new pressures from cheaper imports – holding down prices across the board, with the high dollar making it hard for these firms to pass on price increases, holding down profits – and in turn holding down company tax.  … hells bells … someone gave her a quick class in reality … but does she understand all that it means …

Consumers do benefit, but many businesses are doing it tough.

All this means the data on our economy now reveals a significant new fact.

This is the striking and continuing divergence between what economists refer to as real GDP growth and nominal GDP growth.

My best shorthand description of those terms is this.

Real GDP growth is growth in the volume of the economy.

The actual activity in the economy, how many jobs there are, the quantity of infrastructure we build, the amount of goods and services we export – how many tonnes of coal, how many international students pay for a course here, how many houses are built.

Nominal GDP growth counts this growth in volume and it also counts growth of the prices of all these things.

Today, real GDP is growing solidly – we’re creating more jobs, exporting more goods and services and buying and selling more from each other, just as we planned.   … all underpinned by the creation of new debt to fund new policies introduce over the last few years …

However prices are growing at a slower rate than is usual for this stage of the economic cycle, a slower rate than was forecast – and so nominal GDP growth for this current year is significantly slower than was forecast and we expect nominal GDP growth for future years to be revised down.

The current data shows nominal GDP growth after the first half of the 2012-13 year was an annual rate of two per cent.

At Budget last year, we had forecast nominal GDP to grow at five per cent.

What’s changed?

While the prices of our exports continue to be lower than their recent peaks because of weak global demand and increasing global supply, the prices of imports are now lower than forecast because of the strength of our dollar.

The prices of goods produced at home are also lower than forecast because competition from imports is so fierce.

This is now putting so much downward pressure on prices that growth in nominal GDP is actually lower than growth in real GDP.

What’s more, this has now been true for nearly an entire financial year – since the beginning of the June quarter last year.

This has never happened for such a long period in the whole half a century and more of the National Accounts.

Not during the global financial crisis, not during the 1991 or 1982 recessions.

Not even during the Menzies “credit squeeze” of 1961, which was effectively a deliberate policy attempt to slow price growth, do we find a similar effect.

Now, that’s a long explanation of a pretty technical fact.  … so – all this confirms is that the modelling the RBA and Treasury have been usuing is out of date and not upgraded with new thinking …

But for the Budget bottom line, it’s a very meaningful fact – because, naturally enough, companies don’t pay tax on volume, they pay tax on value, which is driven by price.

The Pharaoh might have kept one fifth part of the grain from the field but the Tax Commissioner collects in dollars and cents.  … fanciful commentary – not serious enough …

So even if the economy is growing as much as expected, when prices are growing much less than expected, tax grows much less too.

The “bottom line for the Budget bottom line” is this: the amount of tax revenue the Government has collected so far this financial year is already $7.5 billion less than was forecast last October.   … that just proves the point – the forecasts were wrong …

Treasury now estimates that this reduction will increase to around $12 billion by the end of the financial year.   … can you believe this number … it changes every month … the real numbers released on the monthly Dept Finance and Deregulation point to a deficit between $15-$20 billion … the $12 billion is not trustworthy …

This unusually low revenue, which wasn’t forecast even a few months ago, creates a significant fiscal gap over the Budget period.

Put simply, spending is controlled but the amount of tax money coming to the government is growing much slower than expected.

Inevitably, confronted with the facts, the economic simpletons and sloganeers will squirm and throw in arguments to distract.   … no-no-no … economic simpletons … that is the pot calling the kettle black …

First, you will be told that revenue for the next financial year is still expected to be more than this financial year. That’s true – at the same time our population will be larger, more people will be on the age pension, health costs will continue to rise.   … the forecasters predicted revenue growth from the MRRT and Carbon tax and it did not eventuate – that was the first of many errors that concertina themselves into this train-wreck …

Indeed the growth in health and in the age pension will be far higher than the growth in tax money. … that’s because you handed out carbon tax refunds and pension increased based of bad forecasts …

So revenue growth will be less than natural growth in key areas of expenditure and is spectacularly lower than reasonably predicted.   … blah-blah-blah … waffle at best …

It is the failure of growth in tax money to match reasonable predictions that creates the Budget challenge.   … unreasonable more likely …

Second, you will be told it isn’t about less tax money in but about spending.   … you know its coming and using the double negative argument to try to lessen the impact is about as foolhardy as you can get ….

However, as informed commentators like Tim Colebatch pointed out last week, excluding east Asia, total government spending in Australia is already the second lowest in the developed world. … is that just Federal, or does it include State and Local …

Of the advanced Western economies, only Switzerland spends a smaller share of its economy on government than does Australia.

The total size of government here is less than the US, less than the UK.

Not as measured in revenue either, measured in spending.   … is that per capita or gross numbers …

And let me reiterate, for the future we will continue to match new spending in the Budget with savings.

Given all this, tax money down, spending controlled, the question for Budget planners is difficult to answer, but simple to state: how, and how fast, to fill that significant fiscal gap?

Some of the above factors will return to trend – overall, revenue is being revised downward over the coming four years, not permanently.

However in part, this is a return to normality – returning to long-term averages.

Australia will not go back to the extraordinary revenue peaks of “mining boom mark I” from 2002-03 to 2007-08.  … I give up … just accept there is little that you can believe in anything Gillard has said here …

While we should expect revenue to improve as we move to the production and export phase of the current mining boom, it’s clear that the extraordinary revenue peaks of the mid-2000s won’t be repeated.

The overall story: by 2005-06 the share of the economy taken in tax reached a peak of 24.2 per cent – compared to 22.4 in 1996 and 22.2 as we reported in our last update in October.

The huge profits of that time meant that company tax revenue reached an astonishing 5.3 per cent of GDP in 2006-07 compared to a share of 4.5 per cent of GDP last financial year – a fall of around $10 billion in company tax a year.

Capital gains tax was 1.5 per cent of GDP in 2006-07 – last financial year it was 0.4 per cent.

We collect less than one-third of the amount compared to seven years ago and in dollar terms the drop in tax collection is around $15 billion a year.

Quite apart from any other factor, remaining competitive in the contemporary global economy doesn’t allow us simply to turn back time on tax collection by dialling up tax revenue to these levels.

If I can summarise a complex picture in a few brush strokes, it’s these:

The prices for what Australian companies sell overseas are lower, imports are cheaper, local competition is fierce.

Those things add up to business making less profit than planned.

That puts pressures on our stable and resilient economy and it is one reason businesses and workers still need to work so hard to get ahead.

When businesses make less profit than planned, it also means Government gets less money in tax than expected.

That’s the big challenge for the nation in this Budget – and it defines the decisions the Government’s confronting as we put the Budget together.

Once again, to break this complex picture down in to a personal story.

Imagine a wage earner, John, employed in the same job throughout the last 20 years.

For a period in 2003 to 2007 every year his employer gave him a sizeable bonus.

He was grateful but in his bones knew it wouldn’t last.

The bonuses did stop and John was told that his income would rise by around five per cent each year over the years to come.

That’s the basis for his financial plans.

Now, very late, John has been told he won’t get those promised increases for the next few years – but his income will get back up after that to where he was promised it would be.

What is John’s rational reaction?

To respond to this temporary loss of income by selling his home and car, dropping his private health insurance, replacing every second evening meal with two-minute noodles.

Of course not.

A rational response would be to make some responsible savings, to engage in some moderate borrowing, to get through to the time of higher income with his family and lifestyle intact and then to use the higher income to pay off the extra borrowing undertaken in the lean years.

Running a nation is always more complex than running a family budget and analogies only work so far.

But I trust the nature of the challenge we confront is now clearer, understood within the framework of the purpose of our fiscal policy and the detail of our medium-term fiscal strategy – and I trust that all would acknowledge the Government has some serious decisions to make and announce in the coming two weeks.

As we make those decisions let me be crystal clear about what we will and won’t do.

We won’t, during this time of reduced revenue, fail the future by not making the wise investments that will make us a stronger and smarter nation.

Better school funding and school improvement will not be jeopardised.

Our nation cannot afford to leave children behind or to leave our nation’s future economy limping behind the pack, unable to attract the high wage, high skill jobs of the future.

To return to John, you would not expect him to stop funding his son’s top quality schooling or his daughter’s university studies.

He would know that to do so would be to condemn his family to a poorer future.

And we won’t fail to make the wise investments that make us a fairer nation.

DisabilityCare must not be jeopardised.

A fragmented, unfair, inefficient system hurting 400 000 Australians with disability and their families and carers – and putting at risk anyone who could acquire a disability – cannot be left in place.

Once again, we wouldn’t expect John to deal with his temporary loss of income by failing to properly support the care of his wife, who has a profound disability.

What is more, these necessary investments are affordable if we make smart decisions.

So the way we proceed with these investments is to fund new structural spending with new structural savings.

But, because we now are confronted with new facts and far more significant reductions in tax money than was expected, we are going through the process now of making decisions to spend less in some areas than we had hoped, to raise more in revenue in some areas than we had planned.

Guiding us as we make these decisions is the key principle of burden-sharing.

Because I lead a Labor Government, I lead a Government which understands that the whole of society benefits from the services Government provides.

In turn we believe that the whole of society should carry a fair share of the burden of funding Government, that the whole of society shares the burden of these saving decisions.

The more who share the work, the lighter the load for all.

Business, families, institutions.

Everyone benefits – so everyone contributes.

In the national interest, for the common good.

Now, there are no easy choices.

Of course as a Labor Prime Minister, I find these decisions both urgent and grave.

This revenue discussion is not historical, it’s very contemporary.

There is new news here compared to six months ago – and new news here compared even to three months ago.

Therefore, I have expressly determined we need to have every reasonable option on the table to meet the needs of the times, even options previously taken off the table.

The nation and the Government must have maximum flexibility to deal with these complex – and rapidly changing – events.

That is my approach.

In the Budget, the Government will do the right thing by the nation, the right thing for the long-term.

We will save responsibly, even when that means spending less on things which are important and valuable.

We will invest wisely for the future.

No one will be singled out, the burden of our decisions will be shared across the whole Australian community.

We will not cut to the bone.

That is the Government’s approach – and it is a bright dividing line in Australian politics today.

I began by saying that this Budget will be about a challenge and about a plan.

It will also be about a choice.

Our opponents and their friends crudely flaunt the bitter language of the cut throat and the brandished axe.

We govern for all Australians, we govern to strengthen the economy and to spread the benefits to all.

Those values illuminate modern Labor every day we govern.

I thank you for the opportunity to discuss them with you today.

It was lengthy and I apologise about that – but you had to get the bullshit context in the message and I did not want to allow for ambiguity.  If one was to go trough paragraph by paragraph, point by freakin point, lie by lie – we’d be here for a long time as critiqued above.

However – Opposition Treasury spokesperson Joe Hockey came out and gave one of his best response comments ever – watch video of his response here[A full transcript of speech is not yet available.]

One cannot count the lies masked throughout Gillard’s lengthy address – the biggest lie was again the reason for the revenue shortfalls.

If a Government uses forward estimates based upon unproven new taxes – [i.e. the MRRT and Carbon Tax] – and uses that forecast to spend in the current and next years budget, the Government deserves to be punished for the fallout.   More importantly – the people need to know the truth.

Gillard has not had reduced budget revenues – she has over the last three years had revenue increases year on year amounting to:

  1. 2010-11: – 5.9%,
  2. 2011-12: – 9.1%,
  3. 2012-13: – 10.5% [Budget Forecast as at Feb 2013.]

This is against an average of 6.98% growth in revenues year on year since 1996-97.

Any attempt to tell it different is criminal in its intent.   Company Directors would face court and jail terms if that tried to hoodwink shareholders with a lie and misrepresentations like this.

This outrage once again shows how Members of Parliament are at the bottom end of regulatory policing – it shows just how little private sector experience they have and how that inexperience gets the Nation to the position we are now in.

Gillard used a illusionary man named ‘John’ to help paint her analogy to explain the Government’s predicament – it was all spin and polish based on a cover-up to blame the economy and GFC for the reduced revenues.   Her speech writer is a novice and also does not understand what it is they do not understand.

In an exhaustive extraction of RBA Budget data the following Table with Chart provides hard data of revenue and expenditure growth (%), and in $dollar terms since 1996-97.   [Click on Image to enlarge in a new window.]

In coming days economists will all have their say – and they have their political sway that will dictate what they write – what is published here is done so without such malice but an exposed truth.   Gillard is a criminal and that is my gripe – how she became the Prime Minister is what I want someone to explain given her history … Australia needs to know that truth as well …

Please – if you found this story to your liking and would like to promote it to your social media contacts – i.e. Twitter, Facebook, or other icon linked account below – please click your favoured Icon(s) to promote the story.  Thank you

Have your say where it counts: – contact your Local Federal Representative via the links below and let them know how you feel about this, or any other topic that you feel strongly about – or you can just post a comment below and let off some steam.

The EYE-BALL Guru …

EYE-BALL’s Harry’s Growl on – Election 2013 – Growl No: 21 – Gillard is the Dumbest … i.e. – 457 Visa’s –

March 10, 2013 Comments off
Latest ‘Harry’s Growl’ Posts:

– 10th Mar – Election 2013 – Growl No: 20 – The ALP Brand – a Catharsis of toxicity  –

– 18th Feb – Election 2013  – Growl No: 19
– The Sham Marriage between the ALP and Greens –

– 18th Feb – Election 2013  – Growl No: 18 – Paul Howes – AWU National Secretary – standing under the crap flow leaking from above –

– 18th Feb – Election 2013 – Growl No: 17 – Wayne Swan’s ‘Sarah Palin’ Moment –

– 17th Feb – Election 2013  – Growl No: 16 – Gillard Blunder’s Again – Draws a line under Age Pensions –

– 16th Feb – Election 2013 – Growl No: 15 – The Devils Brew: who’s left, Gillard, Swan, Shorten, and who else

– 15th Feb – Election 2013 – Growl No: 14 – The ALP tinkering and staring at the abyss …

– 10th Feb – Election 2013 – Growl No: 13 – The Obeid Dynasty Profile –

– 9th Feb – Election 2013  – Growl No: 12 – Dunce Hat’s sit firmly on Gillard and Swan’s noggin’s –

– 8th Feb – Election 2013 – Growl No: 11 – Parliamentary remuneration – Peter Slipper in Profile –

– 8th Feb – Growl No: 10 – Parliamentary remuneration – Peter Slipper in Profile –

– 7th Feb – Election 2013  – Growl No: 9 – Gillard in Focus –

– 6th Feb – Election 2013 – Growl No: 8 – Obeid has decided to take a few with him –

– 4th Feb – Election 2013 – Growl No: 7 – ABC’s “Q&A” proves none of them have a goddamn clue

– 4th Feb – Election 2013 – Growl No: 6 – Gillard in Cartoon Form –

– 4th Feb – Election 2013  – Growl No: 5 – Poll Results,  Senate Leadership, & Pyne’s Hitler Gibe –

– 2nd Feb –  Election 2013 – Growl No: 4 – Craig Thompson’s Bankruptcy revisited –

– 1st Feb – Election 2013  – Growl No: 3 – Roxon’s Rocky Status as the AG  –

– 31st Jan – Election 2013 – Growl No: 2 – Gillard lifts her skirts to thrill the Media  –

– 28th Jan – Election 2013 – Growl No: 1 – Senator Penny Wong … policy exposed –

– 18th Jan – Hedley Thomas and Larry Pickering – – Resume their AWU crusade against Gillard  –

– 1st Jan 2013 – Jenny Macklin – Joins Swan as another ALP Fu_kwit – Claims she can live on the Newstart allowance –

– 20th Dec – Wayne Swan – His backflip on the 2012-13 Surplus – Makes him the Fu_kwit of all Fu_kwits –

– 16th Dec – Lenore Taylor – Chief Political Correspondent for the SMH  – Part II – – A correspondent pushing her own political agenda  –

– 15th Dec – Lenore Taylor – Chief Political Correspondent for the SMH  – A correspondent with her own political agenda  –

– 14th Dec – Gillard’s Gutter Mouth – The dishonour she does to the office of the Prime Minister –

– 3rd Dec – The GREENS – Leader Milne has her head in the sand –

To see more EYE-BALL Harry’s Growl posts: click here …

– Election 2013  – Growl No: 21 –
– Gillard is the dumbest … i.e. – ‘457 Visa’s’ –
| Author: EYE-BALL’s Harry’s Growl | 10th Mar 2013|

Latest Pickering images added – 10th Mar 2013 – see end of text linked here

The question is obvious – how much longer will Gillard survive?   The chant all across the Nation is – “How Dumb is Gillard” in that she does not understand she is no longer a people’s choice or wanted as our PM.

In the week Gillard spent hiding in Western Sydney – all under a disguise to give some of her marginal lap-dog MP’s a chance at the next election – but really to hide out the WA election week she was refused entry to – was described on the ‘Bolt Report’ this morning as – ‘Ruling from a Bunker’ – almost Hitler like in his last days.

“457 Visa’s”

How dumb is Gillard to think that her appointment of John McTernan as her Media Advisor under the terms of a ‘457 visa’ would not come back to bite her on the ass?

In her address to open the ‘Rooty Hill’ week delivered at the Western Syd University a week ago – her closing comments included the following comments – [PM Press link here]

… “To stop foreign workers being put at the front of the queue with Australian workers at the back.” …

… this comment led to the ‘457 Visa’ debate that exploded later in the week.

Nothing comes forth from Gillard unless it has been given the OK by her new Media advisor.

Gillard used her position of influence as the PM to hire McTernan on an overseas ‘457’ visa.  She used her office to avoid the ‘National Security’ issues in hiring a foreigner who will have access to the highest level clearance on matters of National Security and Secrets.

To have access to all the information that comes across the PM’s desk, and under a ‘457 visa’ raises all types of questions – and there is a need to know whether the relevant background checks were done.

Who’s judgement was it that no other Australian could perform the job Mr McTernan was hired for?

Her previous Media Advisor – Tony Hodges – resigned amid the uproar he caused when he tipped off the crowd that initiated the race riots Gillard had to flee from in Jan 2012 – see that story here with video …

It would appear that Gillard is a fan of the ‘political stunt’ opportunity – and after reading McTernan’s Wikipedia profile – and the story on the sacked Tony Hodges, you will understand the ‘political stunt’ profile Gillard likes and is drawn to.

McTernan’s Wikipedia profile highlights some of the stunts Some of the stunts attributed to McTernan’s influence include –

  1. Slippers appointment as Speaker – termed a masterstroke on his page,
  2. The ‘misogynist’ debate Gillard introduced on the floor of the House has been attributed to McTernan.

To quote directly from the page …

… McTernan has been referred to as ‘Gillard’s Brain’. As Chief Media Advisor/Communications Director, reminiscent of Karl Rove, who as George W. Bush’s chief strategist became known as ‘Bush’s brain’. McTernan, keen to repeat the success of his strategy in the UK is believed to be using similar tactics to coach the Australian PM and her ministers in media situations. He is believed to be the brain behind a central media narrative for Labor to frame the Opposition as ‘negative’. …

Gillard wanted this McTernan as her closest advisor – and to think that he was the best person for the job is only a part of the qualification for a ‘457 visa’.   Read the basic conditions  below – [linked here]

The subclass 457 visa is for skilled workers from outside Australia who have been sponsored and nominated by a business to work in Australia on a temporary basis.

A business can sponsor a skilled worker if they cannot find an appropriately skilled Australian citizen or permanent resident to fill a skilled position listed in the Consolidated Sponsored Occupations List.

The information on this page provides an overview of the sponsorship – nomination – application process. Read the following information before starting any process under this visa:

  • Sponsoring – how to become a sponsor
  • Nominating – how to nominate a skilled worker
  • Applying – how to apply for a visa
  • After applying – waiting for a decision
  • Obligations – the conditions and obligations of sponsors and skilled workers under the subclass 457 visa program.

Also – there are other specifics mentioned in the Dept Immigration page re ‘457 Visa’ applications. – [altered in Nov 2012 to appease the ‘boat people’ problem.]

The text of the alteration reads –

The Australian Government has reviewed the 457 skilled immigrant visa and has made some provisions that will fast track the transition to permanent residency starting on July 1, 2012. Starting in July 1, 2012, non-resident workers on the 457 skilled immigration visa will be able to transition to permanent residency if they have 2 years with the employer who has sponsored them and if the employer provides a full-time position in the 457 visa holder’s nominated occupation.

Furthermore, the Australian Government has recognized that 457 visas deserve priority in review as they are highly responsive to the needs of the market.

Ok – who did the background check on McTernan?  Because it is such a sensitive position, the extent of the background checks should be made public – i.e.

  1. Does he have a criminal past,
  2. What are his political persuasions,
  3. What does he bring to the table that a similarly qualified Australian can not provide to the position being filled

Other Immigration Act specifics include:

McTernan’s Wikipedia page gives his history in politics back to the late 80’s. He was born in 1959 – what did he do in his previous 30 odd years?  What of his affiliations and associations before then? Did the background check extend in the same context as refugee backgrounding?

Despite this issue Gillard claimed in her WSU address – predominately Union supporters – that she now wants  –

… “To stop foreign workers being put at the front of the queue with Australian workers at the back.” …

… the double standard is obvious – Gillard flounders and sinks to a level hypocrisy that demands she and McTernan must go … yet who amongst her caucus will be the first to shift and lead the path to a mass exodus that would surely follow?

Odds on a new PM by Tuesday are shortening …

Larry Pickering’s Political Take:

To bring some much-needed levity – there is always the Larry Pickering Cartoons … below is a sample of his summer offerings – his images page can be access here[click on image below to enlarge] … enjoy and don’t hurt yourself with the belly laughs …

Larry Pickering also writes some very intelligent blogs including many on the AWU scandal.  Whilst not as regarded as Hedley Thomas in journalistic circles – his penmanship and his heady wit give him a take on things not easily publishable in mainstream media.  None the less … his take on events cuts to the chase and he does not mince words … his Facebook page can be accessed here

Added 18th Feb 2013:

To see all of Pickering’s Political cartoons – use this link

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EYE-BALL’s Herman on – The Carbon Tax – Post Election …

March 10, 2013 Comments off
Links to Previous ‘Herman’ Posts:

– 7th Mar – Wayne Swan – Please Stop

28th Feb – The Australian Labor Party View

– 6th Feb – Corruption

– 25th Jan – Anti Discrimination

– 17th Jan 2013 – Atheism

– 12th Nov – Hegemony

– 2nd Nov – A March early Federal election

To see more EYE-BALL ‘Herman’ posts:

click here …

The Carbon Tax – Post Election …
| Author: EYE-BALL’s Herman O’Hermitage | 10th Mar 2013 |
The Australia Industry Group (AIG) now favours converting our Carbon Tax to an Emissions Trading System (ETS). That means to allow the electricity producers to buy carbon credits on the world market to satisfy their tax liability and thereby offset.

Carbon Credits sell for 20% of Australia’s existing tax in Europe.This is several things. Tony Abbott has promised to get rid of the tax. What does that mean? Would adopting the AIG recommendation represent a broken promise, to keep the tax but allow ETS offset?

The way things are going the coalition will have such a large majority in the lower house, it will not matter much, and Christine Milne’s promise “over my dead body” may well be her epitaph. The state results in WA overnight simply highlights how the ALP will struggle to realistically expect to win a single seat from the opposition, and their losses will be massive. The electorate wants to expunge the last 3 years as fast as possible

For me, it is only about the micro economic reform that is required to attract manufacturing sector back to Australia. In a perfect world industry should expect to pay closer to 20c a kilowatt hour for energy, rather than closer to 30c. The wage structure is a secondary problem. And as for the currency, that stays in the too hard basket. It should not stay in the too hard basket, but we are a function of free markets and that means Quantitative Easing in both Europe, USA and don’t forget good old Japan. China are currency manipulators (but for that matter what is Quantitative Easing)? Maybe Quantitative Easing is a nice way to call Currency Manipulation by our NATO allies.

From the ALP perspective, they just need revenues to fund their wanton spending program. There truly is a “Goddess of Size” or “Recklessness of Large Numbers” about this government. The Minister for Health is simply incapable of quoting any programme as a per annum cost. The politician requires her to talk about a 10 or 5 year programme costing essentially 5 times or 10 times as much.

The Treasurer too loves to talk in “over the Forward estimates”. The treasury project forward estimates over 4 years. Forward estimates can be very confusing, it means several assumptions like constant GDP or inflation or unemployment. Shift one by a modicum, and what is the outcome? A 1% fall in Government revenues has led to a $22 billion change in deficit this year, so far. Extrapolate that over 4 years.

This is the very essence of what most current debate misses. What does any spending programme really mean to tax take, and will it further erode incentive? The Business Council of Australia (and their fraternal twin Deloitte Access) are all about the road to fiscal repair. I too think that is truly great. I tend to think of it as the Scottish Rite. Waste not! want not!

This comes to the nonsense of costing of programmes. To say that wiping out Carbon Tax and MRRT will leave a hole in the revenue side is fair enough, but when it comes to finding savings that is a work in progress, and simply can’t be costed until it is fully project scoped. What will 20,000 jobs in Canberra save? In the first year not much after paying for redundancy costs. Moreover it does not happen overnight. The way it rationally might occur is finding recurring savings of 10% per annum until efficiency is truly obvious.

This is where NSW State is currently at. In the first 12 months, there was a bit of crumbling at the edges, selling surplus assets (like surplus Roads and Traffic Authority land), attacking volunteer fire fighters Workers Comp, draconian tightening in health budgets, so more beds were closed, but now larger strides are occurring in bureaucracy. Flatter command structures, wholesale layoffs.

Queensland are a year behind NSW. We await details on Costello’s audit where so far predictably all we know is sale of assets to cut the interest cost fiscal drag of accumulated deficit is the way forward to regaining their AAA rating.

Despite what occurred in Victoria this week, should Geoff Shaw cross the floor and bring down the government would a resultant poll see a change of government. It is hard to imagine, but he has already guaranteed to support both supply and confidence. Enough said.

Reverting back to my original posit, if the Carbon tax stays with ETS offset would that be a breach of Tony Abbott’s promise? It is a flawed question! It is only about integrity. Therefore Mr Opposition leader you might think to address this before going to the polls. What do you mean?

Please – if you found this story to your liking and would like to promote it to your social media contacts – i.e. Twitter, Facebook, or other icon linked account below – please click your favoured Icon(s) to promote the story.Thankyou.

Have your say where it counts: – contact your Local Federal Representative via the links below and let them know how you feel about this, or any other topic that you feel strongly about – or you can just post a comment below and let off some steam.

Links to Australian Parliamentary Website – MP’s

EYE-BALL’s ‘Herman’ …

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