Policy Snapshots

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This week’s picks:

The cost of living: land and homes

The Property Council of Australia has released its recommendations for improving housing affordability in Sydney, where housing prices are more expensive than in New York or London. At the bottom end of the market, ‘housing stress’ figures in many people’s lives: 13 houses are being repossessed every day in Sydney. More broadly, 37 per cent of family income is required to pay the average Sydney mortgage.

The report’s recommendations include that the First Home Owners Grant be targeted to the needy and that the federal government re-instate the housing ministry — positions that make the Property Council an unusual bedfellow of community and advocacy groups.

Less surprising are the recommendations that new land releases be fast-tracked; and that public housing be transferred to the private sector, which would be charged with managing and redeveloping declining public housing stock.

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Earlier this year, Kim Carr outlined the parlous state of public housing, arguing that ‘we must…get more affordable housing stock on the ground — through public housing and innovative partnership arrangements with the community and private sectors’.

This year’s State of the Regions report, commissioned by the Australian Local Government Association, also considers the implications of the 1996-2005 land boom. Homeowners received ‘gratifying capital gains’ over the period, but they came at a cost. As well as producing the housing affordability crisis, the land boom has increased costs to business; heavy mortgage indebtedness has reduced disposable incomes; and while land values jumped threefold in some areas, other areas missed out entirely.

Blue denim in his veins

When he took centre stage at the G yesterday, many hoped for a rendition of Barnsey’s ‘Working Class Man’. The week preceding, Greg Combet delivered the ninth annual Bob Hawke lecture in which he rubbished the idea that prosperity and fairness are mutually exclusive: ‘The national interest does not require that some should prosper at the expense of others.’

Combet calls for a new consensus — akin to what Paul Kelly describes as ‘the Australian settlement’. He articulates the need for a flexible industrial relations system, based on collective bargaining and underpinned by a safety net, and identifies key policy priorities: investment in national and local infrastructure and education; addressing climate change; and external security.

Growing gaps

In August, John Quiggin, the ‘economist who looks remarkably like Ned Kelly’ (an epithet proudly displayed on his own website) considered ABS data that showed increasing inequality in both wages and disposable income since the mid-1990s. Quiggin attributed the data to three trends: inadequate investment in education, resulting in the demand for educated workers outstripping supply; a decade of IR reforms and dwindling union membership; and because while ‘tax-welfare policy under the Hawke-Keating government generally offset the effects of increasing inequality in market incomes, the reverse has been true under Howard’.

This month, the Canadian Centre for Policy Alternatives launches its first report in a series which addresses growing inequalities in Canadian society. ‘Growing Gap, Growing Concerns’ charts Canadian perceptions of the widening gap between rich and poor. The economy is booming, the unemployment rate is low, and the federal budget is in surplus. Yet, ‘the rising tide has not lifted all boats’. Extensive public opinion polling, spanning 16 years, shows that 76 per cent of Canadians believe that the gap between rich and poor is increasing. There is no significant variation on this question across income groups. Many are worried about the potential social effects of a divided society, such as increased crime and the Americanisation of Canada. And, many worry about their own financial security: half of surveyed Canadians said that they themselves were only one or two missed pay-cheques away from poverty.

Uranium trade

A group of senior academics have prepared a detailed report that examines Australia’s uranium export deal with China. Marko Beljac is one of the report’s authors; last fortnight on the Centre for Policy Development, Beljac argued that the debate on domestic uranium enrichment must include wider strategic considerations. As Nobel Prize winning physicist Hannes Alven puts it, the peaceful and military atom are ‘Siamese twins': nuclear power capabilities can lead easily to nuclear weapons development programs.

Prepared for the Australian Conservation Foundation and the Medical Association for the Prevention of War, the report explains the international safeguards regime which arises from the nuclear Non-Proliferation Treaty (NPT). Australia has its own system of safeguards, which arise from the 1977 Fox Report, the integrity of which has been progressively eroded by successive federal governments.

Australia’s bilateral agreement with China is scrutinised, and the application of agreed safeguards to the Chinese nuclear industry is deemed ‘more symbolic than real’. For example: the IAEA will monitor an equivalent amount of uranium, rather than Australian uranium. That means, ‘Australian uranium can be used in Chinese nuclear weapons without breaching the agreement, despite statements to the contrary from the Australian Government’. As Julie Macken says on the Centre for Policy Development this week ‘The debate about Australia’s engagement with nuclear power needs the utmost transparency’. At present, we’ve much smoke and mirrors to contend with.

CFMEU on climate change

‘The world needs Australia’s coal. But emissions from its use are contributing to climate change.’ Herein lies the CFMEU’s dilemma. The CFMEU Mining and Energy division has released a discussion paper about addressing climate change. It states that the union has responsibility to protect its members, most of whom rely on the coal industry for their livelihood, and that union members are also members of broader Australian and global communities affected by climate change.

The discussion paper argues that Australian coalmines and/or companies should not be held accountable for the emissions of the countries that consume their coal: accountability for emissions should lie at the point of energy use.

The paper proposes a range of measures to mitigate climate change. Firstly, that coal-fired power generation become more efficient via the use of new technologies. Secondly, that governments commit to the development and commercialisation of carbon capture and storage technologies. Thirdly, that renewable energy technologies should be developed, and required to become commercially viable and cost-effective: the union supports an extension of the Minium Renewable Energy Target, from 2 per cent to at least 5 per cent. Other proposals are canvassed in the paper, and the CFMEU invites interested parties to respond to the suggestions.

PLUS:

Terence Cole’s ‘report of the inquiry into certain Australian companies in relation to the UN Oil-for-Food Programme’ is available here.

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