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April 21, 2005
I was having a coffee in Adelaide this morning on the way to work and I glanced through today's AFR. Bob Hogg, a former national secretary of the ALP, has an op.ed which outlines a bold new reform agenda that he reckons the Howard Government should adopt.
I'm always interested in the policy advice the ALP's ex-movers shakers offer to their political enemies. Peter Walsh and Gary Johns come to mind.
Hogg says that his reform agenda is one that requires a lot of political courage, but the country requires it. The opportunity to implement the tough new reform agenda has arrived as the control of the Senate passes to the Howard Government this July.
That caught my eye. What then is the agenda? No no, it's not about Australia going nuclear to ensure sustainable energy. Hogg's concern is state taxes and the GST. Hogg's policy advice is:
Howard should increase the rate [of the GST] to 12.5% and seek to make it variable by plus or minus 1 per cent. Food should be included in the GST regime, with an appropriate compensation package. In return, the states would have to agree to to either remove or substantially reduce stamp duties on housing, as well as removing other inequitable taxes.
Wow! An ex-ALP national secretary is saying that? That makes him such a good neo-liberal bedfellow with Senator Minchin, the Finance Minister. Nay, Hogg is further to the right than Minchin in defining what 'economically responsible' is.
Now this is not a clever way to help defeat the Howard Government by raising gungho reform expectations within the Government that would then be difficult for Howard to manage. Hogg actually believes this approach to tax reform is the right and proper thing to do for the country.
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Scary stuff. It's a worry that Howard has something of a blank cheque in the Senate come July 1.
There is a real possibility that all (or at least some of) the draconian reforms rejected by a hostile Senate during the last several years will come back in a more mean-spirited form.