Election offers are a stitch up
CRISPIN HULL COLUMN
We got two tinkers when we needed a tailor. Labor and the Coalition laid out their “grand plans” for Australia this week but for the most part they tinkered around the edges of tax, housing, and cost of living instead of laying out a design to deal with the fundamental and structural inequities which have been building for more than a quarter century.
The Coalition’s cut to fuel excise is risible. A key feature of any good tax system is to discourage bad spending habits. That’s why we tax tobacco. Carbon emissions are as toxic to the health of the planet as smoke is to the health of the body.
Having added fuel-excise cuts to the fire, the Coalition wants to add tax-deductible mortgage interest to the over-heated housing market. That with the asinine policy to allow home-buyers access to $50,000 of their super will just increase prices.
On the demand side, Labor is doing nothing. The Coalition, meanwhile, says it will cut immigration by 100,000 having hypocritically knocked back Labor’s legislation to cut international-student numbers in the Senate.
Immigration is out of control in Australia. That was demonstrated after the legislative and legal barriers during the Covid pandemic were lifted. We returned to a system under which if an immigrant or student ticks the right boxes they have a legal right to residence, irrespective of any notional target for the overall number coming in or the economic and environmental conditions in the country.
The Greens are equally hopeless on this. They are scared that calling for lower immigration leaves them open to a charge of racism. It is nonsense, of course. Australia has had a non-racial immigration policy for more than 50 years. “Race” is simply not one of tickable boxes. If you reduce immigration, it is automatically done in a non-racial way.
The 2024-25 Budget forecast of 250,000 for net migration was a double joke. First, it was too high in any event. Second, the actual number is going to be way higher – perhaps nudging 400,000.
Meanwhile, the housing targets and actual construction simply cannot keep up. And that is assuming Australians wants the destructive inner-city density, outer-city sprawl, congestion, loss of agricultural land, and infrastructure backlog that comes with the increase.
Labor’s National Housing Accord called for 20,000 new dwellings a month for 2024-25. We are 3400 behind target now. At this rate it will be 36,180 behind by the end of the financial year.
Labor has promised to underwrite mortgage insurance so first-home buyers need only a 5 per cent deposit. Well, it has some merit, but it will be more fuel to the fire driven again by the fear of missing out.
Of course, the demand side is made worse by negative gearing and capital-gains concessions that make housing a great big tax-reduction scheme for investors, rather than a sector that provides a roof over people’s heads.
If we must have those concessions, why not restrict them to the share market where the investment will at least not deprive people of owning a roof over their head.
Unless these fundamentals are dealt with, politicians are just tinkering ineffectually. But nearly every federal politician is hopelessly conflicted because nearly all of them own investment properties.
High immigration has also reduced competition for labour and so dampened wages, productivity, innovation, and skills training because it is easier to import labour. So, we have an artificial “labour shortage” which employers argue can only be met with higher immigration. But that is just a vicious circle which can only be broken with more and better training, investment, and innovation.
That is the tragedy: this crushing of the home-ownership dream was not done by international, technological, or other economic factors out of our control. It was done by the deliberate policies (or lack of them) of the major political parties, most egregiously by the Howard Government.
They created the mess. They should fix it. They can, but they won’t.
Housing side, tinkering with small lollies for the voters abounded during this campaign. The Coalition has tax-deductible business lunches and a one off $1200 cost-of-living tax offset.
Labor proposes a standard work-expenses deduction of $1000. Again, designed as an election sweetener. If should have been designed to eliminate the need for millions of people to do tax returns. But that would have offended the accounting profession and would have required dealing with other deductions – particularly gifts to charity.
Neither side addresses the tax inequities of relying too much on taxing labour and giving too many concessions to coporations.
The piecemeal sweeteners, however, have unfortunately distracted attention away from this election’s two long-term policies of the major parties that really should be decisive: the Coalition’s nuclear policy and Labor’s battery policy.
The Coalition’s nuclear vision has been so blurry with no detail on costings or realistic timeframes that there is really nothing to see. Every energy expert and economist with an ounce of objectivity knows no nuclear power stations will ever be built in Australia. And every day, more, cheaper, efficient renewables are being added to make nuclear an even sillier white elephant.
It can only be rationalised as a means to keep fossil-fuel profits higher for longer.
Labor’s battery policy, on the other hand, will go a long way to plugging the renewable power-generation gap at night and on windless days. Equally importantly, it will reduce the need for extra transmission lines.
Rather than promoting fossil-fuel vehicles with fuel subsidies, Australia should be electrifying the whole fleet as quickly as possible and replacing fuel taxes with a road-user tax using the sort of telematics common in the trucking industry that require payment according where, when, and how far you travel.
It should also do a lot of industrial development based on our renewables advantage – especially smelting and refining metals.
These tasks are probably more important than fixing housing or cost-of-living mini-crises. If we want to prevent a real trade-induced cost-of-living crisis, Australia will have to almost eliminate its $300bn worth of annual fuel imports when the world decides it no longer needs our $300bn worth of the thermal coal in the next decade or so.
Australia also has to join the world in cutting carbon emissions to net zero. If not, the real housing crisis will be climate-change-aggravated floods, fires, and coastal erosion making dwellings uninsurable at best or uninhabitable at worst.
Ah, but that is in a different timeframe than the electoral cycle so expect the tinkering to continue.
This article first appeared in The Canberra Times and other Australian media on 15 April 2025.
*Crispin Hull is a distinguished journalist and former Editor of the Canberra Times. In semi-retirement, he and his wife live in Port Douglas, and he contributes his weekly column to Newsport pro bono.
- The opinions and views in this column are those of the author and author only and do not reflect the Newsport editor or staff.
Support public interest journalism
Help us to continue covering local stories that matter. Please consider supporting below.
Got a news tip?
Send a news tip or submit a letter to the Newsport Editor here.
Comments
Comments are the opinions of readers and do not represent the views of Newsport, its staff or affiliates. Reader comments are moderated before publication to promote valuable, civil, and healthy community debate. Visit our comment guidelines if your comment has not been approved for publication.