Greens’ Janet Rice says ‘poverty is a political choice’ and Labor must scrap stage three tax cuts
The Greens senator Janet Rice has responded to the indexation increases, in the context of the government not moving on raising the jobseeker rate this year:
Today’s indexation is a less than $2 a day increase for someone on jobseeker. This doesn’t even get payments close to the poverty line, let alone make them enough to live on.
This comes in the same week the RBA is expected to again increase interest rates, making the cost of living even higher, and pushing basic items like food, medicine and rent further out of reach.
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Labor is insisting that they need to spend $244bn on tax cuts for billionaires and the ultra-wealthy. This will see people earning over $200k getting an extra $24 a day.
Poverty is a political choice, and this government is choosing to leave people without heating or food as they struggle to pay the rent. Labor must scrap their stage 3 tax cuts for billionaires and the ultra-wealthy and lift income support rates above the poverty line.
Key events
Paul Karp
The independent senator, David Pocock, has called on the government to bring forward childcare subsidies, due to start in July 2023, and to extend paid parental leave.
Pocock told reporters in Canberra:
We’ve heard … a lot at the jobs and skills summit and over the last hundred days about seeking consensus around issues. It seems like there’s a lot of consensus around child care and increasing shared parental leave leave and things that will help [cost of living]. And I think we should be looking to to bring them forward. Yes, they are costs but they’re also huge benefits.”
Pocock noted there are some “serious disagreements when it comes to industrial relations” when asked about Labor’s other proposed reforms, but did not directly endorse Jacqui Lambie’s conclusion it will be impossible for Labor to pass a bill this year. He said it will depend what the government proposes.
Pocock also described climate negotiations with the government as “lukewarm”. Pocock said his proposed amendments would strengthen the bill – but the government has not been “massively receptive” to making any changes.
Scott Morrison sits down for interview with Paul Murray
Continuing the tradition he set while prime minister, Liberal backbencher Scott Morrison has decided to have a sit down with Sky News’s Paul Murray (the only Australian journalist given the opportunity to speak to Donald Trump during a Morrison visit to the US and asked if he had a “good day with your Aussie mates” and “what do you want to say to your many, many Australian supporters who wish you nothing but the best on November 20”, Scott Morrison’s smile when Trump was bemoaning the ‘fake news media’, why he preferred Morrison to Malcolm Turnbull and “what’s the best thing you’ve ever had from the kitchen downstairs”) tonight at 8pm.
Morrison held a press conference on his secret ministries, which raised more questions than answers, and then made some jokes on Facebook about it, but other than that has been quiet on the topic.
Josh Butler
MPs’ first speeches in parliament
With parliament’s resumption, we again return to the first speeches made by new politicians. Fowler MP Dai Le spoke passionately and emotively about her family’s settlement in Australia as refugees, and the strict lockdown conditions her western Sydney community was placed under last year, likening it to a “communist dictatorship”.
Le, wearing a bodysuit emblazoned with the Australian flag, claimed her community were “the forgotten people”. Her speech was greeted with supporters in Parliament House’s public galleries clapping, shouting and chanting her name.
Labor MP Alison Byrnes, representing the Wollongong seat of Cunningham, said her area was keen to participate in the jobs opportunities presented by clean energy, even as coalmining and manufacturing jobs may be on the decline:
I support action on climate change structured to create jobs while reducing emissions. The Illawarra has long been a place of steel, mining and heavy industry. Our deepwater port and world-class university provide enviable connections to the globe. We stand ready to be leaders in achieving net zero emissions by 2050.
We stand ready to use our skills to produce high quality steel in a more sustainable way. It will be used to build the renewable energy and transmission infrastructure we need to power homes and industries.”
Byrnes said there was “a skills crisis in renewable energy”, and that Wollongong locals and businesses could play “a major role in supplying that highly skilled workforce.”
Labor MP for Chisholm, Carina Garland, is up next. Later today we’ll also hear the first speeches from Liberal MPs Keith Wolahan and Henry Pike, as well as senators Linda White and Ross Cadell.
Wages v profits
Peter Hannam mentioned the difference in wages compared with profits in his last post.
This graph shows exactly how wide that gap is:
Antipoverty Centre: ‘maximum rent assistance of $72 a week a pittance compared with median rent of $508 per week’
The Antipoverty Centre has also responded to the indexed social security increases (which come in, as usual, on 20 September).
From its statement:
$1.78 a day indexation for the base jobseeker rate offers no relief for the millions of people subjected to poverty payments and the treatment we receive in the media. Indexation is designed to ensure that payments do not fall behind CPI, however CPI is an inadequate measure of rising living costs for people on low incomes in urban areas – it doesn’t even attempt to measure the pressures facing those in remote areas.
The reality is that people on welfare are suffering each and every day and we will continue to suffer unless politicians stop justifying cruelty and stop forcing us to try and survive in poverty. People are being forced into homelessness, with the maximum rent assistance of $72 a week a pittance compared to median rent of $508 per week. Some properties have increased by $100 a week between tenancies.
More people will starve themselves, more people will become homeless, and more people will die for as long as the government refuses to spend money and use its vast resources to help us.
Peter Hannam
More on the economy
As noted in the earlier post, ABS data would add a few more of the missing pieces to the June quarter puzzle.
After the bumper earnings season that just concluded (particularly if you were a fossil fuel exporter, as we noted here) it isn’t a big surprise that corporate profits posted a notable jump in the quarter.
Still, the 28.5% annual pace of profit growth compared with 6.8% for salaries might have disturbed the harmony that otherwise characterised last week’s jobs summit.
Inventories, another contributor to GDP, rose at an annual rate of 4.2% in the June quarter – the fastest pace in at least six years (although that would not have been high on the summit agenda).
The number of job ads, meanwhile, continued to hold up, ANZ reported this morning. It had been expecting March to be the peak in the current cycle but labour demand remains high even as those RBA rate rises start to sap some of the sentiment in the economy.
Also of interest is news from the Federal Chamber of Automotive Industries that showed car sales topping 95,000 for August, or 17.3% than a year earlier.
Sales of electric vehicles reached 4.4% of the total, with Tesla also selling 3,397 vehicles.
This is the highest market share for pure battery electric vehicles ever recorded in a single month in Australia,” FCAI head Tony Weber said.
Taking into account hybrid vehicles, such cars now make up more than 10% of the market.
Speaker rules against debate on Scott Morrison referral for multiple ministries
Paul Karp
The Speaker of the House of Representatives, Milton Dick, has just said he will not grant precedence for a debate about whether to refer Scott Morrison to the privileges committee over his multiple ministries.
As Guardian Australia reported in August, Dick was not persuaded by the Greens MP Adam Bandt that a prima facie case has been made that Morrison deliberately misled the house when he failed to notify it he had been appointed to administer five other portfolios.
Dick said that he “understands the concerns of the member” (Bandt). While he cannot give precedence to a motion to refer Morrison “it is still open to the House to determine a course of action in relation to this matter”, he said.
Simon Birmingham quizzed on what to do with the fuel excise pause
Simon Birmingham stopped by doors this morning (doors is when politicians choose to enter the parliament by one of the main two entrances for MPs – they know journalists are there, so enter via those doors when they have something to say – there are plenty of areas we are not allowed to interview people in, which is why when politicians want to avoid us, they can, because under the DPS rules, we are not allowed to have cameras in certain areas).
Birmingham was asked about the fuel excise pause expiring and said:
Well, the policy to cut the fuel excise was put in place by the previous Coalition government at a time when oil prices were very, very high and it was done so to address that particular cost of living pressure. We’ve seen some of those oil prices come down a bit and stabilised over time. But we’ve seen other inflationary pressures rise. So with this reduction in fuel excise coming to an end, it is for the government to explain what else they are going to do to actually help Australians with the cost of living pressures they now face and that they’re facing in a range of other ways beyond those in fuel excise alone.
Q: If you were still in government, would you be recommending that this be continued?
Birmingham:
Well, we’re not in government unfortunately. We no doubt would have continued to put a strong emphasis on helping Australians with cost of living pressures. It’s what we did in government, what we would have continued to do. But it’s now for this government, the Albanese Labor government, to explain what is it they are going to do to help Australians with the cost of living, given they seem to be letting this fuel excise cut come to an end.
Which is not an answer – so the opposition is happy to slam the government for allowing the fuel excise to expire, but can’t actually say whether or not it would have extended the pause itself.
Sydney traffic diversions after accident involving tram
(If you are reading the blog in Sydney I am including this traffic update because it is a fairly major one).
Pitt St is closed in both directions at Eddy Ave due to a crash involving a vehicle and a tram. There’s no access into Eddy Ave from Elizabeth St. Northbound traffic is being diverted into Quay St and southbound traffic can use Elizabeth St or George St.
Jobseeker rise ‘does not deliver a real increase’
And before anyone gets too excited about the increase to jobseeker, it is not going to make a material change to beneficiaries’ lives.
As Acoss’s acting CEO Edwina MacDonald said:
We regularly speak to people who cannot eat three meals a day, who cannot afford essential medication and who are in debt with their utility provider because they cannot cover the cost of energy.
While an extra $1.80 a day will help, [the] jobseeker payment remains grossly inadequate to cover essentials.
Youth allowance, the unemployment and student payment for young people, is just $38 a day and won’t be indexed until January. Young people will somehow have to cope with skyrocketing cost of living on a payment that doesn’t cover average rents let alone everything else.
Indexation of jobseeker happens twice per year in line with the consumer price index. The 20 September rise reflects the CPI increases from December to June 2022. It does not deliver a real increase – an increase above inflation – and that is what people on jobseeker and other payments need to keep a roof over their head and put food on the table.
The federal government must urgently increase jobseeker, youth allowance and related payments in the October budget to address the acute crisis facing people on the lowest incomes. Jobseeker and related payments must be at least $70 a day so that everyone can cover the basics.
Peter Hannam
The week to come economically
It’s been quite a big week economically, which we can expect to “inform” or “inflame” debate in parliament over cost-of-living pressures.
Before May, the monthly Reserve Bank board meetings were mostly dull affairs since the cash rate had been sitting a record low of 0.1% since November 2020.
That was then. The RBA now seems to be fairly set on lifting its key interest rate every month and is now in the midst of its most aggressive tightening phase since 1994.
Tomorrow we should see another increase from the 1.85% level, with the guessing game settling on whether a 40-basis-point rise to 2.25% would be neater than a fourth hike in a row of 50bp to 2.35%.
Ahead of Tuesday’s expected RBA board meeting investors are rating likelihood of a 50 basis point increase to 2.35% as more than a 4-in-5 chance. For now, they’re tipping cash rate peak in a year’s time at just under 4%. (Economists: ‘hard landing’ ahead if that’s the outcome.) pic.twitter.com/ksDawn3WFr
— Peter Hannam (@p_hannam) September 5, 2022
Come Wednesday, the ABS releases GDP data for the June quarter, and the sentiment is for another solid three months of growth to be reported.
There will be a few more stats out before then that economists will plug into their models to fine-tune forecasts, but our $2 trillion a year economy will be growing at levels that might be about their peak.
More data out today and tomorrow, but for now economists are expecting GDP growth in the 2nd quarter to show an uptick. @WestpacMacro are among those, predicting an acceleration to 4.5% growth from a year earlier, and 2% vs the March quarter. pic.twitter.com/CG6wGYIff9
— Peter Hannam (@p_hannam) September 5, 2022
For one thing, the effect of the current spate of interest rate rises is still to work its way through to consumers.
CBA puts that delay at about three months – and as it issues about one in four mortgages in Australia it has a wary eye on “hip-pocket” pain.
The coming slowdown, though, is mostly about a question of how much. While a lot of attention is placed on the federal budget – which the treasurer Jim Chalmers will release on 25 October – it’s worth keeping an eye on how states are faring too.
Moody’s has an interesting report out today that looks at how debt loads are rising almost everywhere, while revenues will likely ease off as property prices (and therefore stamp duty) drop.
@MoodysInvSvc has an interesting report out today about rising state debt in Australia. Revenues dependent on the property sector face being squeezed while the cost of repaying the mounting debt will likely go the other way… pic.twitter.com/tBDN7i9aBr
— Peter Hannam (@p_hannam) September 5, 2022
“Global credit conditions are weakening and a slowdown in growth lies ahead,” Moody’s says. “We expect rising inflationary pressures – compounded by energy supply issues (and prices), rising debt servicing costs, softer consumer and business sentiment and increased capital market volatility – to ultimately constrain revenue growth.”
In its not very cheery assessment it also notes: “States continue to face physical climate risks and may require extensive capital spending to build long-term resilience, although direct economic impacts from recent flood events in Queensland and NSW have been modest.
It’s a point worth highlighting as we head into another likely wetter-than-average spring and summer (including a third La Niña event in as many years) and possibly a more active than usual tropical cyclone season.
Sales of electric cars hit record levels
AAP has an update on electric vehicle sales – turns out that we want to buy them. Huzzah – the weekend has been saved!
The Australian vehicle market has posted its best August result for five years, with a 17% surge in demand as sales of electric cars hit record levels.
The Federal Chamber of Automotive Industries says 95,256 new vehicles were retailed last month, up from 81,199 in the same month last year, the best August result since 2017.
FCAI chief executive Tony Weber said sales of electric cars accounted for 4.4% of total demand, the best monthly result for battery-powered vehicles in Australia.
We have seen strong sales of battery electric vehicles in August, with Tesla alone selling 3,397 vehicles.
Year-to-date EV sales are 2% of the total market, hybrids are 7.6% and plug-in hybrid vehicles are 0.6%.
Combined electrified vehicles are now just over 10% of total sales in 2022.
Weber said the overall August result was also a positive sign for the industry after two years of constrained supply, due to both the Covid-19 pandemic and a shortage of computer chips.
This gives hope that the supply of vehicles to the Australian market is beginning to show signs of improvement.
The August result took total sales so far this year to 717,575, still down on the 732,828 sold at the same time in 2021.
Toyota was the market leading company last month, selling 20,616 vehicles ahead of Mazda on 8824, Kia (6780), Hyundai (6643) and Mitsubishi (6380).
The Toyota Hi-Lux was the top-selling vehicle with 6214 ahead of the Ford Ranger with 4497, Toyota’s RAV4 with 2482 and Tesla’s Model 3 on 2380.
Context …
This is correct, but it is because of indexation.
Context is important.
From this month, millions of Australians will see the biggest increase to their pension in 30 years.
— Anthony Albanese (@AlboMP) September 5, 2022
José Ramos-Horta to visit Australia
Anthony Albanese has just announced the president of Timor-Leste, Dr José Ramos-Horta, will be visiting Australia from tomorrow:
I am delighted to announce I will meet with His Excellency Dr José Ramos-Horta, president of the Democratic Republic of Timor-Leste, during his Guest of Government visit to Australia from 6 to 11 September.
His Excellency General the Honourable David Hurley AC DSC (Retd), governor general of Australia, will host President Ramos‑Horta. The president will visit Government House for a ceremonial welcome and state lunch and will lay a wreath at the Australian War Memorial.
Australia and Timor-Leste enjoy a close relationship based on our shared history, mutual interests and strong people-to-people links. The president’s visit reflects the deep ties between our two countries.
Australia is committed to supporting Timor‑Leste’s economic development. This visit will be an opportunity to further deepen this relationship, and explore avenues for strengthened cooperation both bilaterally and in the region.
I look forward to welcoming President Ramos-Horta to Australia.
Josh Butler
Senate debate starts on territory rights bill
The Senate debate on Labor’s “territory rights” bill around voluntary assisted dying has begun, with already two Coalition senators supporting the push and one Labor senator raising doubts about it.
The bill, which would allow the Australian Capital Territory and Northern Territory to make their own laws on euthanasia – which they’ve been blocked from doing for 25 years – passed the lower house last month by a resounding 99-37 margin, but the Senate vote is expected to be much closer.
🔔 Debate started this morning in the Senate on the Territory Rights Bill 🔔
It’s been a long journey to get here and now that the Bill has passed the House of Reps for the 1st time ever, we have our best chance at repealing the Andrews Laws once and for all.#auspol pic.twitter.com/zHcfzgP6Lp
— Katy Gallagher (@SenKatyG) September 5, 2022
Finance minister and ACT senator Katy Gallagher, supporting the change, said it was a chance to “right the wrong”. Coalition senator Simon Birmingham, who backed a similar change that was ultimately unsuccessful in 2019, said it was wrong for the federal government to block the territories from making euthanasia laws in the first place.
Voluntary assisted dying makes the kinder pathway of avoiding prolonged pain, suffering or loss of dignity,” he said.
ACT senator David Pocock has campaigned strongly on the change, and will support the bill. He said he was mindful of strong moral opposition to voluntary assisted dying, but noted strong public support for the change.
Labor senator Deb O’Neill, who opposed the 2019 push, described herself as a “garden variety Catholic” and said it was important to have a “faith perspective” in the debate. Recounting her father’s experience with palliative care after diagnosis with a brain tumour, O’Neill spoke about palliation and pain management, and access to health services.
Nationals deputy leader Perin Davey said she saw the change as being about democratic freedoms, not euthanasia, indicating she would support the move.
We either support the territories making laws … or we don’t,” she said.
I don’t think it’s fair that the territories always have this hanging over their heads, that if we [federal parliament] don’t like their laws, we’ll come into this place and work against them.”
Greens’ Janet Rice says ‘poverty is a political choice’ and Labor must scrap stage three tax cuts
The Greens senator Janet Rice has responded to the indexation increases, in the context of the government not moving on raising the jobseeker rate this year:
Today’s indexation is a less than $2 a day increase for someone on jobseeker. This doesn’t even get payments close to the poverty line, let alone make them enough to live on.
This comes in the same week the RBA is expected to again increase interest rates, making the cost of living even higher, and pushing basic items like food, medicine and rent further out of reach.
Labor is insisting that they need to spend $244bn on tax cuts for billionaires and the ultra-wealthy. This will see people earning over $200k getting an extra $24 a day.
Poverty is a political choice, and this government is choosing to leave people without heating or food as they struggle to pay the rent. Labor must scrap their stage 3 tax cuts for billionaires and the ultra-wealthy and lift income support rates above the poverty line.
Half of Australia’s GDP is generated by industries that rely on nature – report
Michael McGowan
Half of Australia’s gross domestic product is generated by industries with a “moderate to very high” direct dependence on nature, according to a new study that argues for a stronger suite of environment laws to protect the economy.
Co-authored by the Australian Conservation Foundation, the report found $896bn of the country’s economy – or roughly 49% – is dependent on the natural environment.
Using the same modelling as the World Economic Forum’s landmark report that found US$44tn trillion of global GDP is dependent on nature, the report found sectors such as agriculture, forestry, fisheries, food manufacturing and water generate some $293bn per year, or roughly 16% of the country’s economic output.
Others with a moderate or high direct dependence on the natural environment – such as mining, real estate, accommodation and hospitality – contributed $602bn per year, or about 33% of GDP.
“Every Australian business depends on nature, whether they make things out of steel, build houses, grow food or trade stocks,” ACF chief executive Kelly O’Shanassy said.
For some industries the dependency is direct and obvious, but indirectly, there is not a dollar exchanged in the economy that does not depend on nature. Every worker and consumer needs clean air and water, food, their health and a safe climate.
And nature is in trouble, which spells bad news for the economy if we don’t reverse nature destruction and halt the extinction crisis.
The ACF used the report to argue that Australian businesses should consider the risk of the destruction of the natural environment into their practices. It argues businesses not only risk their reputation and financial blowback from damaging the natural environment, but also “material inputs”.
Josh Butler
Pocock says he got ‘lukewarm’ response from Labor on climate bill amendments
ACT senator David Pocock claims he got a “lukewarm” reception from the Labor government when proposing amendments to the climate bill that would bring more transparency to the federal stance on emissions reduction.
Pocock and fellow independent Jacqui Lambie have proposed the Climate Change Authority be obligated to publish the advice and recommendations it gives to the climate change minister, and explain how that fits with latest scientific advice.
Lambie has been upset the government hasn’t responded positively. Pocock said he was disappointed.
The reception has been lukewarm. We’ve been putting forward our case, they’ve made it pretty clear that they feel like they’ve given some amendments in the lower house and they’re keen to see it pass,” he told a doorstop interview in Parliament House this morning.
For me it really is about transparency, integrity and accountability … I’ve said I’m happy to vote for a bill that the target probably isn’t where it needs to be, definitely isn’t where it needs to be, but if that actually has integrity as a starting point and we can ramp it up over time, then it’s a good start.
Pocock admitted he wouldn’t stand in the way of the bill passing, but said it has to be “a target with integrity”.