Services for all or tax cuts for the few

by Peter Symon

The revelation that the Federal Government budget has a $7.5 billion tax 
surplus shows conclusively that the savage cutbacks that the Howard 
Government has made to public health, education and many welfare programs 
cannot be justified. The money was there to finance these government 
responsibilities. The cutbacks were driven by the Howard Government's 
ideological agenda, their hostility to everything that is publicly owned 
and that benefits the ordinary working people and their families.

The budget income and expenditure is not audited by any outside body and 
the surplus may be much more than has been revealed.

It has not been achieved as a result of "good management" by Howard and 
Costello but by the millions of dollars cut from the proportion of 
government expenditure going to health and education and other welfare 
programs.

Other contributing factors are the imposition of the GST by the Howard 
Government that has taken billions from the pockets of mainly working 
people. Over $31 billion was collected from the GST in the last financial 
year and it has been rising by about $3 billion each year.

Bracket creep

Another factor is "bracket creep" that pushes some wage and salary earners 
into more highly taxed brackets. There is a justified argument that tax 
brackets should be adjusted to take account of the increase in wage levels 
for some categories of workers.

There has been a massive assault on the unemployed, disabled persons, carer 
allowances and those receiving other necessary welfare benefits.

The Howard Government is the most destructive of essential services that 
Australia has ever had. At the same time it has imposed on working people 
the heaviest tax regime of any in the developed industrialised countries.

The statements by Howard and Costello following the announcement of the 
budget surplus clearly indicate their cycnical preference for tax 
concessions to middle income earners in the hope that this will win their 
vote for the present government in the next Federal election.

Priority

The priority must now be established by a massive public demand that the 
monies cut from health, education and other social welfare benefits be 
restored and that this BE GIVEN PRIORITY over tax cuts to only a few. This 
provides benefits to all and particularly to low and middle income earners 
to pensioners and other welfare beneficiaries.

The fact that the Government has been forced to suspend the health 
insurance levy imposed on doctors as a result of the threatened resignation 
of specialist doctors shows that decisive action by sections of the 
community can force a retreat by the government.

* The budget surplus must be used to increase the rebate paid to doctors so 
that Medicare bulk-billing can be maintained as a service to every member 
of the community.

* The free public dental service destroyed by the Howard Government should 
be re-established.

* Some of the surplus could be used to re-establish government insurance 
offices so that the huge costs imposed on doctors by way of insurance 
premiums could be scaled back and contained. The policy of privatisation 
should be reversed.

* Millions are available to properly fund universities and to wind back the 
new impositions recently forced on the public education system. HECs fees 
should be completely abolished. (In the 1970s it was possible to have free 
tuition in universities but 30 years later universities are being starved 
while huge debts are being forced on students).

* Any government concerned for the Australian people and the future of our 
country should reestablish free public education from kindergarten to 
university.

Who pays?

A basic question concerning taxation is, who pays? While company tax has 
been reduced from 47c in the dollar to its present 30c in the dollar — and 
many companies pay much less than this requirement, with some paying no tax 
at all — tax paid by working families has gone up, particularly as a 
result of the GST.

The CPA remains adamantly opposed to the discriminatory GST. It should be 
replaced with a progressive tax system based on earned income, particularly 
by tax paid on company profits.

The fact that many families are vastly worse off is revealed in the figures 
for household debt which has risen from $290 billion in 1996 (the year the 
Howard Government was first elected) to $660 billion now. This situation 
demands that the financial policies being pursued by the government are 
forcing many more to borrow to keep going. The debt on credit card 
borrowings is now substantially over $20 billion — over $1000 for every 
man, woman and child in Australia.

Another source of budget income could be that from the profits earned by 
publicly owned enterprises. The stupidity of the privatisation of public 
enterprises and facilities such as the sale of Qantas, airports, Telstra, 
the sell-off of buildings previously owned by governments, is now apparent.

Kenneth Davidson writing in the Melbourne Age writes, ".the 
dividends forgone from the sale of half of Telstra are greater than the 
interest saved on the retirement of debt. The leaseback arrangements from 
the sale of Government property such as the Foreign Affairs headquarters 
are far more expensive than the previous situation in which the Government 
owned the buildings".

He writes, "an extra billion dollars a year put back into public hospitals 
and universities would generate jobs and take pressure off household 
debt".

Letters carried in daily newspapers and the response on talk-back radio 
indicate that many people do not support tax cuts while allocations to 
public services such as health, education and welfare are further attacked 
and neglected.

Public pressure demanding that these services be given priority needs to be 
built from now until the next election as part of the campaign to 
decisively defeat this most conservative and anti-people government that 
Australia has ever suffered. Letters to newspapers and participation in 
talk-back radio session, writing to your local Federal member and Senator 
will all help to build the campaign.

Vital statistics:

Foreign debts has grown from $190 billion when the Howard Government was 
elected to $360 billion now.

Commonwealth taxation has increased from 23.5 percent of GDP (1996) to 25.4 
percent of GDP in 2003.

Household debt is up from $290 billion in 1996 to $660 billion now.

The Federal Government's GST rip-off increased from $27 billion when first 
introduced in 2001 to $341.25 billion in the last financial year.