Tuesday, June 21, 2016

NSW Budget 2016: Winners and Loser

If any one fail to meet a claim for debt, and sell himself, his wife, his son and daughter for money or give them away to forced labour: they shall work for 3 years in the house of the man who bought them, or the proprietor, and in the fourth year, they shall be set free.
~ Code of Hammurabi, King of Babymon, c 1750 BC [ Spector of Vaclav Havel and Naked Capitalism: How financial crises produce political polarization]

NSW has complained it is a "victim of its own success" because its surging economy will reduce its share of the GST pie to a record low, creating challenges for its budget in the next few years.
In a budget with few surprises, Treasurer Gladys Berejiklian on Tuesday promised a surplus of $3.7 billion in 2016-17 which is $1.2 billion higher than forecast in the half yearly update just six months ago. The state is expected to stay in the black for all of the next three years but in the latter two years surpluses have been revised down by almost $2 billion since the half-yearly review and will fall to around $1.3 billion.  Ms Berejiklian blamed this on an expected slowdown in revenue growth especially from stamp duty as the property boom fades.
There will also be a dramatic decline in the state's share of GST, which is now expected to be $1.3 billion lower than six months ago.
"Ironically we are the victims of our success when it comes to GST."
The state's economy leads Australia with growth of 3 per cent forecast next year thanks to government-led infrastructure spending and a housing boom.
Terminating redundancy entitlements of public serfs

Post Budget:
"Mike Baird talks a lot about integrity but actions speak louder than words"
Opposition Leader Luke Foley will pledge to restore millions of dollars in funding to the NSW corruption watchdog cut by the Baird government as part of a package of measures to "integrity and transparency to NSW politics". The Opposition Leader will also promise more support for the electoral commission to investigate political donations via a "flying squad" in his budget reply speech in NSW Parliament on Thursday Lukas aka Luke Foley: Budget in reply speech pledge to restore ICAC funding

Budget: it looks rosy now but there is a sting coming ...


Google on NSW Budget 2016
Duties to be abolished and foreign investor surcharges introduced in NSW Budget 2016/17
The NSW Government has announced that it will abolish mortgage duty, share transfer duty and non-real transfer duty and introduce foreign investor surcharges on stamp duty and land tax on residential real estate in the NSW Budget to be handed down on 21 June 2016.
Source: NSW Treasurer media releases,  13 June 2016 and  14 June 2016 June 2016

Wow! The NSW Liberal Treasurer has refused to rule out campaigning for a 50% increase in the GST during question time.
All predatory systems of power seek to mask their ultimate aims. As they become more repressive, they become more deceptive. They silence dissidents and bombard the airwaves with lies. Those who effectively resist have to peel back the layers of deceit to understand the intentions of the elites.
We must understand corporate power Fight ... 

Tory MPs always get jittery when the talk turns to selling the family silver. Harold Macmillan famously likened Margaret Thatcher’s privatisation policy to doing just that.
His implication was that it was not something a gentleman would ever do – or not until his creditors were mustering like vultures and he had already sold the horses, the Rolls-Royces and the Canalettos. To this day, the family silver analogy comes up whenever privatisation is discussed. What's wrong with selling the family silver?

Democratic Audit UK, 12/6/16. The key terms that I believe best describe the spirit of the book emerge as ‘targeted expertise’, ‘crowdsourcing’, ‘experimental governance’ and ‘citizen engagement’. Instead of the traditional advisory committee model that mainly relies on stakeholder representation (missing the epistemic value of committee membership) and typically produces a report or a set of recommendations over months or even years, Noveck suggests that new technologies should allow us ‘to make consultation on a day-to-day basis and to strive for constant conversation with an engaged and knowledgeable public’.
Book Review: Smart Citizens, Smarter State: The Technologies of Expertise and the Future of Governing by Beth Simone Noveck

The Financial Price of Forgetting Bad Times:
Interesting age-related differences emerged when the scientists looked at how well young and old people remembered gains and losses. While the young undergraduates were most likely to remember big losses, the older cohort—the group had an average age of 78-—did relatively better when shown faces paired with large gains.

In the 2016 State Budget, the NSW Treasurer has announced the introduction of a surcharge for Duties if a foreign person purchases residential land in NSW and Land Tax where a foreign person owns residential land in NSW.
The budget includes changes to the Jobs Action Plan Budget 2016 NSW

NSW Budget 2016: More cuts to government agencies

NSW Budget 2016: Sydney entrepreneur school hunting for unicorns

Budget repair' brings record surplus  


NSW Budget 2016/17
The New South Wales Treasurer, Ms Gladys Berejiklian, handed down the NSW Budget for 2016/17 on 21 June 2016. The Treasurer announced the following tax and related measures:
(1) A 4% stamp duty surcharge will apply on the purchase of residential real estate by foreign purchasers, to commence on 21 June 2016.
(2) Foreign investors will no longer be entitled to the 12-month deferral for the payment of stamp duty for off-the-plan purchases of residential property.
(3) A 0.75% land tax surcharge on residential real estate, including on a principal place of residence, owned by foreign persons commencing in the 2017 land tax year (from 1 January 2017).
(4) Foreign persons will not be provided with a tax-free threshold for the land tax surcharge.
(5) For new applications from 31 July 2016, the value of the Jobs Action Plan payroll tax rebate will be increased from $5,000 to $6,000. The payroll tax rebate is available to businesses with 50 or less full-time equivalent staff.
The Treasurer also confirmed that the government will abolish duty on business mortgages and unlisted securities, and transfer duty on non-real business assets from 1 July 2016, as previously announced in the 2014/15 Budget.
The State Revenue Legislation Amendment (Budget Measures) Bill 2016 containing the following budget measures has completed its passage through the NSW parliament and awaits assent:
(a) amending the Duties Act 1997 (NSW) to impose a surcharge duty of 4% in relation to the acquisition of interests in residential land by foreign persons and to remove the off-the-plan duty concession in the case of foreign persons
(b) amending the Land Tax Act 1956 (NSW) to impose surcharge land tax of 0.75% on residential land owned by foreign persons, and
(c) amending the Payroll Tax Rebate Scheme (Jobs Action Plan) Act 2011 (NSW) to increase the payroll tax rebate for new jobs from $3,000 to $4,000 for the second year of employment and to restrict the rebate applying to those new jobs to employers who have 50 or fewer full-time equivalent employees.
Sources: NSW government budget website; Budget 2016/17 Overview, 21 June 2016..
Note: for a useful summary of the changes to State taxes associated with the Budget, see the NSW Office of State Revenue website.

NSW budget 2016: commissioning, savings and service delivery 

Poole, and Reason, have actually claimed that Poole coined the term “privatization.” This is disputed, but no one doubts the fact that Poole’s thinking has had a major impact on policy, not just in the United States, but throughout the world. A former adviser to Margaret Thatcher explained how Poole’s writings from the 1970s supplied a blueprint for wresting control from the government:
“The intellectual case for ‘contracting out’ came from an American MIT-trained engineer turned policy wonk, Bob Poole, head of the Reason Foundation in Santa Barbara and author of a little book called Cutting Back City Hall. In this book he explained how all you needed to run a city was a CEO, a lawyer to review contracts and a secretary. Everything—literally everything—could be outsourced and he littered his book with examples and figures….[Thatcher adviser Michael Forsyth] translated Poole’s work into an English context and, led by the Westminster City Council, ‘contracting out’ spread like a contagious disease throughout the country.”

  TSA as Example of Privatization Playbook: Make an Agency Perform Badly By Underfunding It….
The TSA is a perfect target for privatization, since even at the best of times, it is not well liked. Who wants to be subjected to security theater like taking your shoes off? But this article provides an important overview of how various government functions are made incompetent by cutting their budgets without reducing their duties. That plays into the popular narrative that of course the private sector would be more “efficient” when the evidence is strongly supports the view that private sector contractors treat privatization as an opportunity for looting (contracting in the Iraq War was an extreme case, but there are plent of others, such as privatization of parking meters in Chicago and toll roads). Socialising Losses and Privitising Profits

Free Meals Influence Doctors’ Drug Prescriptions, Study Suggests Wall Street Journal. As we’ve said repeatedly, gifts as small as a can of soda will predispose the recipient to a sales pitch.

George Osborne has a fairy godmother who, with a wave of her wand, showers money over much of the population. It hardly seems possible in this age of austerity, but it happens all the time and soothes the anger of many who might otherwise protest at the closure of local amenities and cuts to welfare budgets.
This godmother comes in several guises, but essentially always does the same thing: she steals from the future to pay for things today.
And Osborne is not a bystander in this. He has created the conditions for this heist and in some cases become the fairy godmother himself – helping to soften his image and create millions of mini-lottery winners he hopes will vote for him in 2020.
Last week we heard from the insurer Legal & General how the “Bank of Mum and Dad” will help finance 25% of UK mortgage transactions this year. It said parents could find themselves lending their children as much as £5bn to help them on to the property ladder, providing deposits for more than 300,000 mortgages. Osborne’s fairy godmother can’t make debts vanish forever 

“The possibilities that exist between two people, or among a group of people,”Adrienne Rich wrote in her beautiful 1975 speech on lying and what truth really means“are a kind of alchemy. They are the most interesting thing in life. The liar is someone who keeps losing sight of these possibilities.” Nowhere is this liar’s loss of perspective more damaging to public life, human possibility, and our collective progress than in politics, where complex social, cultural, economic, and psychological forces conspire to make the assault on truth traumatic on a towering scale.
Crises of the Republic

We held our fire on the progress of California Assembly bill AB 2833, a private equity fee transparency bill, in the hope that its sponsor, Treasurer John Chiang, who sits on the CalPERS and CalSTRS boards, was acting in good faith. In fact, AB 2833 was amended on Wednesday so as to be so pointless that we oppose the bill and urge California readers to call and write their representatives to urge them to vote against it in its current form Banana Republic California Treasurer Chiangs Private Equity Transparency Three Card Monte

FutureNet Sydney - Politics in the Pub (Budget Briefing) Thursday, 23 June 2016 to Thursday, 23 June 2016

How voters’ personal suffering overtook reason — and brought us Donald Trump WaPo. “The white working class differs in a significant way from the people who have discovered it.” Interesting dichotomy.

Post Script:
20 July 2016: Big victory for Baird mergers as Woollahra Council loses court challenge