Aged care crisis a clue we’ll be paying higher, not lower taxes

Do you like paying tax? No, I thought not. With so many other calls on our pockets, it’s easy to tell ourselves we’re already paying enough tax – probably more than enough.

Trouble is, our reluctance to put more into government coffers doesn’t stop us demanding the government spends more on additional and better services.

This presents a problem for politicians on both sides. They solve it by ensuring that, particularly in election campaigns, they tell us what we want to hear, not the unvarnished truth.

They’re often promising a tax cut sometime after the election, but also telling us their plans to spend more on this and more on that. What they don’t mention is what might have to happen after the election to ensure the tax cuts and spending increases don’t add too much to government debt.

But we’ve become so distrusting of our politicians that, in more recent years, they spend less time telling us how wonderful their own policies are and more time telling us how terrible the other side’s policies would be. Fear works better than persuasion.

Scott Morrison won the last federal election partly by claiming the Liberals are the party of lower taxes, whereas Labor is the party of “tax and spend”. It worked so well he’s bound to say it in this year’s election campaign.

So, it’s worth examining the truth of the claim. It strikes a chord because it fits voters’ stereotypical view that the party of the bosses must surely be better at running the economy and managing the government’s budget than the party of the workers.

But just because it fits our preconceived notions doesn’t make it true. It’s true that Labor’s record shows it to be a party that spends more on public services, and so has to tax more. What’s not true is that the Liberals are very different.

The record simply doesn’t support their claim to be the lower taxing party. If you look at total federal tax collections as a proportion of national income (gross domestic product) – thus allowing for both inflation and population growth – over the past 30 years, taxes have been highest under the Howard government and the present government.

Most of this has happened without explicit increases in taxes and despite governments usually having tax cuts to wave in our faces as proof of their commitment to lower taxes.

So, what’s the trick? An old one that all of us know about but few of us notice: bracket creep. It works away behind the scenes slowly but steadily increasing the proportion of our incomes paid in income tax. This usually ends up increasing tax collections by more than governments ever give back in highly publicised tax cuts.

Now, however, the aged care sector’s inability to cope with the additional pressures from the pandemic – where they’re so desperate for workers they even want help from the Army’s clodhoppers – offers a big clue about the tax we’ll be paying in the coming three years: more not less.

Ever since the public rejected Tony Abbott’s plans for sweeping spending cuts in 2014, the government has been trying to keep a lid on government spending in areas where there wouldn’t be much pushback.

By this means the Libs have had remarkable success in limiting the growth in government spending overall but, as the Parliamentary Budget Office has warned, they’re holding back a dam of spending. They can’t keep it up forever.

Eventually, problems and pressures from the public get so great, the government has to relent and start catching up. You can see that in this week’s election-related decision to reverse some of the cuts in grants to the ABC.

But a more significant area where the government’s been trying to limit the money flow is aged care.

It’s clear the sector’s problems getting everyone vaccinated and coping with COVID-caused staff shortages have just piled on top of all its existing problems.

The longstanding attempt to limit costs by moving the sector to for-profit providers has failed, with businesses making room for their profit margin by cutting quality. The aged care workforce is understaffed, underqualified, underpaid and overworked.

Most jobs are part-time and casual; staff turnover is high. When a work-value case before the Fair Work Commission is decided, hourly wage rates may be a lot higher.

After the royal commission’s shocking revelations, the government had no choice but to ease the purse strings, spending an additional $17 billion in last year’s budget. But it’s already clear a lot more will need to be spent to get the care of our parents and grandparents up to acceptable standards.

Turn to the national disability insurance scheme and its problems, and it’s clear we’ll end up having to spend a lot more here, too.

And that’s before you get to the failure of the job network – “employment services” – and the chaotic understaffing of Centrelink.

We have a lot of repressed government spending to catch up with. Don’t let any pollie tell you they’ll be putting taxes down.

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Abused public servants help bring Turnbull down

There's no clearer sign that the Turnbull government is in deep political trouble than the never-ending saga of the Centrelink robo-debt stuff-up.

A well-functioning government would have closed down the controversy more than a month ago. If the relevant senior or junior minister hadn't had the wit to do it himself, the Prime Minister would have told him to.

Instead, the controversy's been allowed to roll on, while the junior minister, Alan Tudge, and more particularly the man allowing himself to be described as general manager of Centrelink, Hank Jongen, have repeatedly denied that there's any problem with the automated debt recovery system that's been making life miserable for many Centrelink "customers", including many who, in truth, owe the government nothing.

To broaden the focus, this is the story of how a highly class-conscious government – which sides with the well-off "lifters" against the less fortunate "leaners" – has come adrift from political reality and is using and abusing its public servants to prosecute its war on those unfortunate enough to need to deal with Centrelink.

Its lifters-class sympathies have included the public service among the leaners-class, meaning it's been at war with its public servants, while using them to harass presumed welfare cheats.

Its class consciousness has blinded it to such simple truths as that, while you can always bully the top public servants into covering for you, when you mistreat the servants they stop warning you about the hazards you face and, ultimately, indulge in schadenfreude when you fall over the cliff.

As a class, public servants are not held in high esteem by the public. That's why the government has thought it safe to mistreat them, while also allowing the quality of service provided to the public to decline and using public servants to get tough with the many thousands of leaners imagined by the lifters to be ripping off the system.

Trouble is, when you oblige the public servants to deliver bad service to the public – phones that go unanswered, long waiting times, websites and phones that keep dropping out (not you, Tax Office) – or treat the public unreasonably, the punters blame the government.

As they should. Centrelink and Tax Office "customers" have votes, and their family and friends have votes, too. That counts treble when the "customers" are on the age pension.

First proof the government's at war with its public servants is that its determination to limit public service wages means it's failed to reach enterprise bargains with up to three-quarters of its staff.

One of the first acts of the Abbott government, like the Howard government before it, was to sack a bunch of department heads.

Nothing could be better calculated to make the remaining department heads fear for their jobs should they do anything to annoy the government.

Is it any wonder that when the bureaucrat really responsible for Centrelink, Human Services Department secretary Kathryn Campbell, who'd been refusing to speak to the media for weeks, had no choice but to front a Senate committee, she was full of denials and obfuscation?

No boss enjoys receiving frank and fearless advice, but only the dumb ones take steps to ensure they're surrounded by yes-persons.

The other way ministers limit the ability of their departments to pass on unwelcome advice is to interpose a bunch of young punks and political wannabes between them and their senior bureaucrats.

Successive governments' desire to avoid confronting unpleasant truths has prompted them to fill their departments with armies of public relations people – people who'd be of greater service to the public if they got behind a counter or answered a few phones.

It turns out that Jongen, the man who's happy to leave the public with the impression he's the general manager of Centrelink, has no responsibility for running it. He's just the department's "official spokesman".

He's the chief spin doctor – meaning when he knowingly misleads the public he can do so with a clear conscience. That's what he's paid to do. Apparently, the department has more than 30 people with "general manager" in their title.

The government's contempt for its public servants is reflected in the repeated rounds of "efficiency dividends" it imposes on its agencies.

These far exceed the improvements in labour productivity the private sector's able to achieve, and have become a euphemism for annual rounds of forced redundancies.

The public service union's claim that the 5000 jobs lost do much to explain the poor quality of Centrelink's service, as well as the government's mindless rush to use robots instead of humans, isn't hard to believe.

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