July 07 Edition.
Election Outcome.
I deliberately deferred writing the blog until today – confident that we would have an election result and that I would be in a position to comment.
To catch me out – this is definitely not the case! As everyone knows we are not there yet and as of 1:30pm we do not have a result.
Looks like 74 / 71 / 5 or 75/ 72 /5 will be the outcome. With the order being Coalition /Labor / Others according to the ABC Election Computer. Namely a hung parliament with all that comes with that!
This is a good link to watch for the next day or so!
To also just shake things up a little we have also had this happen.
S&P adjusts Australia's credit outlook to negative
Ratings agency S&P has revised its ratings outlook for to negative from stable on Thursday.
In a statement, the agency said it had also affirmed a AAA long-term and A-1+ short-term unsolicited sovereign credit ratings.
At the same time, S&P revised its outlook on Export Finance & Insurance Corporation to negative from stable and affirmed its AAA long-term and A-1+ short-term issuer credit rating on the wholly owned government company.
"The negative outlook on Australia reflects our view that without the implementation of more forceful fiscal policy decisions, material government budget deficits may persist for several years with little improvement," S&P said in a statement.
"Ongoing budget deficits may become incompatible with Australia's high level of external indebtedness and therefore inconsistent with a AAA rating."
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Needless to say this has set off a lot of discussion – and concern to just what it means!
Since the election there have been some interesting articles – which I have linked below – but the most interesting little factoid I noted were a number of suggestions that the Health Minister had really done badly failing to counter Labor on health and was at risk of being re-located. Maybe a new minister might see what nonsense the myHR is????
Sadly another major macro issue has also emerged!
Forget Brexit -- Italy is poised to tear Europe apart
Jul 6, 2016, 6:45 AM
Italy is on the cusp of tearing Europe apart but the economic and political crisis brewing in the nation is largely going unnoticed.
All eyes have turned to Britain’s vote to leave the European Union as having the most drastic political and economic impact onto the 28-nation state but if you look at the country’s economic data, bank issues, and the impending constitutional referendum coming up, Italy is like a bomb waiting to explode.
The Italian financial system, to put it gently, is in a major state of flux right now. While Britain’s EU referendum in June was seismic in terms of having economic and political repercussions across the bloc, there is another referendum of equal importance, coming up in Italy in October, and the result could fundamentally alter the state of the already delicate Italian economy.
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What a mess!
General Budget Issues.
Hello, Pauline, Derryn, Nick, Jacqui, let’s negotiate: why the budget is toast
All those nice shiny figures in the May budget showing a path back to surplus are now just figments of Scott Morrison’s imagination
‘While the old Senate was tough enough, the likelihood is that the LNP will need nine extra votes to get legislation passed in the new Senate.’ Pictured: Jacqui Lambie and Nick Xenophon Photograph: Mick Tsikas/AAP
Monday 4 July 2016 09.32 AEST Last modified on Monday 4 July 2016 17.17 AEST
It is entirely apt given the government used the budget as its de facto election campaign launch that we now find after the election result that the budget is completely trashed.
Launching the campaign so closely after the budget meant none of the key measures contained in it have been presented before parliament. That budget included a large number of spending cuts which failed to get through the old parliament; they have even less of a chance now. In the old parliament, the issue was the merely the Senate, now there is a strong possibility the cuts wouldn’t even pass the lower house.
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Health Budget Issues.
Federal Election 2016: Voters tell Turnbull to leave Medicare alone
July 3, 20168:45pm
Election 2016: Turnbull confident his government will be returned
VOTERS have told politicians to keep their hands off Medicare and medical groups say billions of dollars in cuts must be reversed after health emerged as the key issue in the election.
Acknowledging a powerful Labor Party “Mediscare” campaign could have cost him the government Prime Minister Malcolm Turnbull said he wanted a criminal investigation into Medicare text message to voters on Saturday.
The Australian Federal Police confirmed on Sunday they had been asked to investigate the texts.
“The Australian Federal Police (AFP) can confirm it received a referral on Saturday 2 July 2016 in relation to the receipt of text messages allegedly sent from Medicare,” a spokeswoman said.
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Federal election 2016: How Labor’s Mediscare plot was hatched
- The Australian
- 12:00AM July 4, 2016
Pamela Williams
With the temperature outside fit to freeze, Malcolm Turnbull arrived at the Coalition’s campaign headquarters in Canberra at close to 1.45pm last Thursday. He had wrapped up a successful speech to the National Press Club and now he would thank excited campaign staff for their hard work.
They would win “with the luck of the gods”, he told the crowd as it gathered in a bland room adorned with a few posters on the wall. It was now up to the judgment of the Australian people. He added optimistically: “I think Labor’s lies have started to wear thin.”
Turnbull did not reveal the bad news he had just received. In a private office, party director Tony Nutt had walked the Prime Minister through the numbers. It was not a happy picture. The Coalition’s recovery in the polls had stalled. The advertising blackout had begun. They could not counter Labor’s ground campaign with mass union volunteers. And with seats up-ended by the exodus to independents, the outcome was unclear.
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Election 2016: 'Mediscare' campaign worked because voters were already scared
Date July 3, 2016 - 6:39PM
Peter Martin
Economics Editor, The Age
COMMENT
Scare campaigns only work when they reinforce or add to what is already known.
The scare campaign worked because Medicare's supporters were already scared
Within weeks of its election in 2013 the Coalition entertained a proposal from a former advisor to Tony Abbott as health minister to end free visits to the doctor by requiring a mandatory co-payment of $6. Anyone who didn't like it would be invited to take out private health gap insurance.
Its Commission of Audit recommended a co-payment of $15 per visit and $5 per concession card holder, and then its first budget announced that "previously bulk-billed patients can expect to contribute $7 towards to cost of standard consultations." Medicare Rebates would be cut by $5 and bulk billing incentives would "only be paid to providers when they collect the $7 patient contribution". It encouraged public hospitals to charge public patients who walked in off the street in order to stem the leakage from doctors.
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The real winners of the Mediscare campaign are doctors and the medical industry
Date July 6, 2016 - 12:00AM
Ross Gittins
The Sydney Morning Herald's Economics Editor
The success of Labor's "Mediscare" in this election is worrying - but not for the reason you may imagine. Its greatest effect may be to fatten the incomes of medical specialists and corporate medical suppliers.
Scare campaigns are often effective politically, but they can impose a high price on the country's good government.
Scare campaigns are often effective politically, but they can impose a high price on the country's good government.
Tony Abbott's highly successful scare about depredations of the carbon tax at the last election has left us bereft of an effective and relatively low-cost means of reducing our greenhouse gas emissions at a time when climate change is worsening and we've been obliged by international pressure to agree to a tighter target.
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Federal election 2016: Medicare can’t be a ‘money pit’
- The Australian
- 12:00AM July 7, 2016
David Crowe
David Uren
Malcolm Turnbull and Scott Morrison are staring down Labor demands for a spending splurge on Medicare as the nation faces a $93 billion bill for the universal health service over the next four years, prompting the Treasurer to warn it cannot become a “money pit” for taxpayer funds.
Medicare is the third-largest government cost behind payments to the states and the Age Pension and has also been one of the fastest growing. The Medicare levy, which extracts 2 per cent from all income, only covers just over half the cost of the scheme, with the remainder financed by taxes and government borrowing. The total cost for each taxpayer is $1850 a year.
The Coalition is mobilising against Bill Shorten’s campaign for higher Medicare spending in a renewed political fight that will decide whether the vast health system is locked away from major reform despite concerns about whether its costs can be sustained.
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Health Insurance Issues.
Tax not the big driver for health insurance
- The Australian
- 12:00AM July 5, 2016
Sarah-Jane Tasker
The fight to form government in Australia continues but one message from both major parties that cut through was “buyer beware” on health insurance, with fewer policies taken out to avoid tax.
Financial research and comparison site Canstar has reported a significant drop in the number of Australians shopping for cheap health insurance policies specifically to avoid additional tax.
Canstar editor in chief Justine Davies said usually there was a build-up at the end of the financial year in the proportion of visitors to the website looking for a health policy in order to avoid tax.
The figures normally peaked in June, with 8.45 per cent of visitors to the site last year looking for a health insurance policy just to avoid tax.
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Craig Drummond has problems to fix at Medibank Private
- The Australian
- 12:00AM July 6, 2016
John Durie
Craig Drummond faces a monumental task to get Medibank Private into shape amid falling market share and what promises to be a regulatory overhaul no matter which team takes government.
The private health insurance sector is over-capitalised and in the process of being hit with a digital revolution, which should remove the fundamental imbalances that limit consumer choice and inhibit competition.
Drummond started his new job on Monday, replacing 14-year veteran George Savvides, who left earlier than the market was expecting, less than two years into life as a listed company.
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Superannuation Issues.
Australian federal election 2016: Malcolm Turnbull faces superannuation backlash as postmortem begins
Date July 3, 2016 - 12:46PM
Michael Gordon
Political editor, The Age
Malcolm Turnbull is coming under massive pressure from within to recast the superannuation changes he took to the election amid widespread anger and despair in Liberal ranks over his election campaign.
My phone hasn't stopped ringing this morning from people saying it serves them right.
Insiders are convinced the superannuation changes contributed to the loss of so many Coalition seats and the prospect of a hung parliament.
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Federal election 2016: Morrison urged to retreat on super changes
- The Australian
- 12:00AM July 4, 2016
David Uren
Scott Morrison is under pressure from conservatives within the Coalition to roll back the budget changes to superannuation taxation, with former minister Eric Abetz claiming they contributed to the loss of three Coalition seats in Tasmania.
Super fund members affected by the budget changes can expect months of uncertainty as whichever party is able to form government reaches a final position to be negotiated with a difficult Senate.
The most controversial of the changes, the lifetime $500,000 cap on non-concessional super contributions, took effect on budget night, May 3, and covers contributions backdated to July 2007.
Anyone who was about to breach that threshold would not know their position. Both Coalition members and many sectors of the super industry contend that the changes breach the principle that new regulation should not affect the treatment of investments that have already been made. Senator Abetz said this principle was “very dear to the core base of the Liberal Party”.
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I look forward to comments on all this! It really is a bit of a mess for all of us!
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David.
