Budget response to my local member

The Hon. Paul Fletcher MP

Member for Bradfield

Dear Paul

I write in response to the recent Federal budget.

While I do not accept that we face a budget crisis I do accept that currently we are spending more than we are earning and that if action is not taken to address this imbalance the crisis will become a reality. This fact was highlighted by different commentators in the lead up to the last election when both parties were promising not to increase taxes.

For this reason I acknowledge the courage of the current government to address the issue. What I object to is the inherent unfairness of the strategy proposed.

My mother is a pensioner approaching her 90th birthday. My parents were farmers until they sold the farm and retired. It was a small family farm and the price they got for it when they sold it was less than one would get for a lot of homes in the more affluent parts of Australia. Until they retired they paid tax every year that they earned enough from the farm to do so but, as you will be aware, not every year is a good year on the land. They received few, if any, benefits from the Government. Now Mum faces a co-contribution for her first seven visits to the GP plus other increased costs and changes to pension indexation.

Regarding the pension, I support philosophically the move to increase the retirement age to 70. We have better health care, education etc than that which was available when the 65 was determined as the retirement age and we do live longer. We have greatly improved work health and safety standards, and most people start work at an older age than was common even in the 1960s when I entered the work force. We should be able to work longer. But there may always be those hard physical tasks or tasks that involve permanent shift work or other factors that will make it very difficult if not impossible for people to work through to 70 - or 67 - and still enjoy a reasonable quality of life. Fairness dictates there must be some strategy to support these individuals.

Another factor that I would like to see addressed in the discussion on retirement ages is the value to the community of volunteer work done by younger retirees. If we lose this pool what impact will that have on the community, either in terms of replacing this contribution by government funded services or in terms of loss to community?

If an individual is able to work and work is available yet makes no effort to seek employment I fully support that person being taken off benefits. There are however many Australians who have been given a real kick in the guts by life - the disabled, accident victims, those unable to find work despite their best efforts, those who have given up work to become full time carers for family members thus saving the community the cost of caring for those who need it. Now it seems they are being belted again.

What about young people like my daughter? Half way through next year she completes her teaching degree. Now, if I understand the budget correctly unless she is able to find work or continue to learn she will not be entitled to any benefits for six months as she will only be 23. Am I expected to support her at the time I am planning to retire? What about other young people from low income families? Again, I support incentives to encourage people to find work or to improve skills, but this seems harsh.

The Prime Minister tells us that in order to correct the budget imbalance it is necessary for everyone to make a sacrifice. Nice words, but the 'heavy lifting' is not evenly distributed. High income Australians will be required to pay a 'deficit levey' for two years. Pensioners and low income people will be required to pay a co-payment for the rest of their lives. It seems there are other options the Government could have looked at, such as family trusts and tax concessions available to those on higher incomes. Could you please tell me how much tax the Government forgoes as a result of richer Australians maximising their superannuation arrangements, options that are not available to workers on lower incomes?

I do believe we need a system that rewards effort. In other words, an individual who takes some risk, demonstrates some initiative and reaps a reward for that effort should enjoy the fruits of their labour. But inherited wealth is not the same as earned wealth, and the wealth earned by the parents can be used to give the children opportunities that are not available to other Australians. I believe Government should look to limit inherited wealth with  the aim of avoiding and increasing gulf between the top and bottom ends of society in terms of wealth distribution.

We do need a national discussion regarding taxation. I am aware that some other nations have a much higher tax take than we do but in return their people enjoy free education, health care and the like. And why are changes to the GST off the agenda?

Finally, this is 'our land'. It belongs to the Australian people, not individuals or corporations. The wealth of the land in terms of natural resources belongs to us all. Again, there needs to be some reward for taking the investment risk to extract this wealth. But there needs also be an obligation on those to whom we give the right to extract this wealth to share that wealth fairly with the rest of the community, not just be providing retirement. Any system that allows the accumulation of vast wealth by the few needs fixing.

I see a nation that is growing more and more divided. We seem to have a growing problem with alcohol and drug fuelled violence, increasing intolerance to immigration and resentment in general. Political debate appears to becoming more divisive and intolerant of alternative views. I have real concerns about the legacy we are leaving our children and grandchildren.

Paul, please take time to consider my comments. I look to our political leaders to give us a vision for the future of this nation - one based on reward for effort, concern for the less well off, where all contribute as they are able, and all share in the wealth of the land.

Yours Sincerely

Ken Marsh