On 10 May 2018, CPD and ANU invited leaders from government, business, civil society, academia and the media to reflect on the mid-term implications of the federal budget and to discuss how Australia’s fiscal priorities and processes stack up against the rest of the world.
Our Policy Dialogue was hosted by ANU Chancellor and former Foreign Minister, the Hon Gareth Evans AC QC and moderated by CPD Board Member, Sam Mostyn. Our three kick-off speakers (who spoke in a personal capacity) were:
- Greg Smith (Chairperson at Commonwealth Grants Commission, member of the Henry Tax Review, and former CPD Treasurer)
- Miranda Stewart (Professor, University of Melbourne Law School and former Director of ANU Tax and Transfer Policy Institute)
- Peter Whiteford (Professor, Crawford School of Public Policy at ANU and CPD Fellow)
The key points at heart of our Dialogue were:
- International economic drivers of budget forecasts;
- Changes on the tax and revenue side, including anticipated changes to personal income tax rates;
- Changes in large social security programs and likely distributional impacts; and
- Significant omissions from the budget.
“Hidden in every budget is a strategy”, Greg Smith reminded the group at the start of his remarks, differentiating the budget measures from the budget parameters and outlining the major economic drivers behind the budget forecast. Miranda Stewart followed with her perspective on the tax to GDP ratio and so-called “budget rules”, the income tax reforms, and their combined effect on future tax reform. Peter Whiteford, Australia’s leading expert on social security and taxes-and-transfers policy, took a longer view on where this might head, and the implications of a “hard cap” on tax/GDP. Peter reminded the group how lean Australia’s social security system is, and how 70% households have passed through it at some point over the past decade.
The opening remarks were followed by a wide-ranging discussion with a diverse and expert audience. Participants included: Conny Lenneberg (CEO, Brotherhood of St Laurence), Daniel Gradwell (Senior Economist, ANZ), Emma Dawson (CEO, Per Capita), Gareth Evans AC QC (Chancellor, ANU and former Foreign Minister), Greg Smith (Chairperson, Commonwealth Grants Commission), Janine Dixon (Economist, Centre for Policy Studies), Kelly O’Shanassy (CEO, Australian Conservation Foundation), Lynne Haultain (Executive Director, Victoria Law Foundation), Megan Flynn (Group Manager Environment and Carbon Strategy, Qantas), Mike Fitzpatrick (Former Chairperson AFL Commission), Miranda Stewart (Professor, University of Melbourne Law School), Misha Ketchell (Editor, The Conversation), Paul Orton (Global Head – Project & Export Finance, International & Institutional Banking, ANZ), Peter Binks (CEO, Business/Higher Education Round Table), Peter Whiteford (Professor, Crawford School of Public Policy at ANU), Rachel Ball (Head of Public Policy and Advocacy, Oxfam Australia), Sam Hurley (Policy Director, Centre for Policy Development), Sam Mostyn (Non-Executive Director and CPD board member), Shelley Mallett (General Manager, Research and Policy, Brotherhood of St Laurence), Terry Moran AC (Chair, CPD and former Head of the Department of Prime Minister and Cabinet), Travers McLeod (CEO, Centre for Policy Development).
Much of the discussion focused on what was not in the budget, as opposed to what was in it. For example:
- Investment in APS capability and human services;
- A broader tax reform agenda;
- Clarity on Australia’s strategic position in the region and ways to boost trade competitiveness;
- Broader measures for the new, clean economy and a sustainable finance agenda (in addition to those for the black economy); and
- A push to run the economy ‘hotter’ and get unemployment below its stubbornly high rate (compared to developed economies like the US, Japan and Canada).
Two decades on from the Charter of Budget Honesty Act, and with the Thodey Review into the APS underway, the group also considered whether it might be time to rethink the way the budget process runs in Australia
CPD would like to thank Gareth Evans and the team at ANU House for hosting the event, and all the participants who contributed to another engaging ANU-CPD Policy Dialogue.
Budget Forum 2018: Tax Caps and Tax Cuts: Good for Australia?, Miranda Stewart, Austaxpolicy, 14 May 2018.
How Australia fared in the 2017 Open Budget Survey.