Thursday, February 02, 2006

Naked self interest

The SMH a couple of days ago had a story about Australian Business Limited's suggestion of how the NSW state government should cut spending, improve efficiency and cut business taxes. OK so far, so good. I tend to agree that the NSW state government hasn't exactly spent its money wisely in the last few years - just look at our train system, and our education results. So I wouldn't be surprised to see a business proposal to spend the money more wisely on (say) infrastructure or better training for apprentices, that kind of thing.

But this proposal appears to be naked self interest. They've gone through the NSW budget with a fine tooth comb for cuts to things that won't hurt businesses - "under the plan, students would pay an $80-a-year levy for school travel passes, Sydney Water pensioner concessions would be halved and public housing rents would rise. The group wants the $50-per-child back-to-school allowance abolished along with the program to reduce class sizes for children in kindergarten, year 1 and year 2, pending an evaluation... It also proposes cutting disability services, TAFE spending and road maintenance, and abolishing the NSW Film and Television Office, the Privacy Commission and the Office of Women."

And what do they propose to spend the money on? Snuck into the end of the story is "It also proposes cutting payroll tax in NSW from 6 per cent to 5.25 per cent by 2008-09 ($1.5 billion)."

To me, this would have a lot more credibility if it spend valuable analytical time on the things the state government does badly that create headaches for business. My examples would be things like improving the TAFE system to help employers train employees, improving the public transport system so that employers wouldn't have employees being late for meetings all the time (and could actually use trains instead of taxis to get to meetings), facilitating the provision of childcare places where they are needed instead of in areas that tend to have lots of stay at home parents...

But all these are complex, require complex solutions, and might even require funding in the short term. But instead the ABL proposes cutting TAFE spending and road maintenance, the kinds of things that are an investment in our future and would improve the balance sheet of the state. Much easier just to ask for a reduction in payroll tax, and continue to run down the infrastructure of NSW so that future generations of taxpayers will have to pay for our lack of maintenance.


At 9:23 pm, Blogger phil said...

I'd agree with you, but it does kind of raise the question of how you define 'economic conservative'. I reckon I'm one also, but it still causes me grief: see 'a question of balance' and 'oh baby it's a wild world' on my own blog.


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