Tuesday, October 4, 2011


Wayne Swan's ideal moment - everyone focussed on him.

But don't expect anything will actually happen. That would mean doing something and risk changing the status quo.

The trouble is that by doing nothing we actually are making decisions, because of the flow on effects. If you want to spend money on the CDF's salary there won't be enough to pay for musical instruments for military bands, as this column suggests . . .


There's no need to be alarmed. Or even alert. Although the Tax Summit begins today, the cautionary instincts of our vacillating, nervous Treasurer can almost certainly be guaranteed to ensure that this opportunity to recast the nation's tax system is squandered. The nations happy trajectory, with the rich getting richer, will remain untroubled. At one time Wayne Swan was so outraged about the inequitable division of wealth that he wrote a scathing book decrying this unfair situation. That was when he was in opposition. Now, somehow, it's all become so different.

Over the next two days Swan will struggle hard to ensure that nothing is done to change the situation. The Treasurer appears determined to forego the opportunity for any wide-ranging reform – no matter how desperately it's needed. The problem is that tinkering around the edges will no longer suffice. The way wealth is distributed in Australia is the direct outcome of our tax system. And it stinks.

It's difficult to understand why Swan is so reluctant to act. After all, even though the crisp, rustling notes of his own $288,865 pay-packet might hardly appear modest to the average worker on $67,116 (including overtime and bonuses), it's hardly enough to insulate him from the increasing disparities around him. Incredibly, ridiculously, and stupidly, the Treasurer earns less – far less – than most of the people that work for him; even though he has no job security and has to put up with being the butt of disparaging ridicule such as the bile informing this column. Even Julia Gillard receives (just) $366,366, although her two houses, domestic staff, and never having to put a hand in her pocket to pull out a wallet must help to balance the household budget.

And that's as it should be. Because of her position she's required to entertain. She needs support to do her job because, after all, she is the Prime Minister and so earning somewhere between 5 and 6 times the average salary seems about right. But that's when you compare downwards and nobody is doing that any more. It's far more interesting to look at those ahead of you, to work out where your aspirations might take you or stroke your envy with a bit of rightful indignation at waste and mismanagement.

That's the fun game we've all been playing with Defence. Earlier this year there was a day or two of confected outrage that the Service Chiefs still possessed batmen (or "soldier-servants" in the old parlance). There were immediate public demands (followed within seconds by political edicts) for such antique reliquaries of a bygone age to be dispensed with. Presumably the idea was that, because he'd already practiced spit-polishing his boots for decades, General David Hurley would be able to do without someone who could ensure his brass and buttons are shiny whenever he is called upon to review a ceremonial parade.

That notion is rubbish of course, but this strange attempt to shoehorn the military way of life into a civilian template persists. Last week saw two examples of such stupidity. The first was the announcement the Remuneration Tribunal will enquire into what it obviously considers an outrageous anomaly that has been allowed to develop in the pay of top public servants, like Hurley. It appears he's to be granted an urgent “one-off" catch-up pay rise of about $300,000 (providing a total income of around $800,000) to provide parity with other “senior decision-makers in the corporate world".

The politicians will waive this increase through, because it will, inevitably and swiftly, flow through to them. After all, they are also “people of capacity and standing", are they not? It appears, however, that unless they receive sufficient remuneration they'd never be attracted to the job.

And there’s the flow on. It hardly appears appropriate for Defence’s Vice-Chief to remain on $380,880, even though his salary was boosted to that level just four months ago. After all, this is a gap of nearly $400,000 with his superior. Better boost his pay, too.

As long as we continue to be excited by upward envy this corrosive desire for more and more money (simply to maintain relativities, of course) will eat away at the fabric of society. It makes far more sense to fix remuneration by looking at the relativities downwards. Try valuing General Hurley's contribution against that of a soldier putting his life on the line in Afghanistan rather than weighing it up against the pay of an accountant, even one working for a top 500 company.

Surely it's far more appropriate to try and decide, first, just how many multiples of the average income anyone should receive. Let them keep that amount and then tax the rest.

It's not his fault, but Hurley's pay rise provides an example of the sorts of choices the government is making about how it’s spending our money.

As a young Captain, Hurley was posted to Sydney University Regiment, a reserve unit with a smartly kilted bagpipe band. The skirl of its pipes and the beat of the drums regularly added tradition and spirit to parades throughout the state. That was until last week. HQFORCOMD/OUT/2011/X2304104, is a minute that purports to eliminate official support, “effective immediately", to the three regular and 14 reserve regimental bands.

It is perhaps unsurprising that the Colonel under whose name this particular document was released was apparently too ashamed to sign it. The shoddy thinking behind the instruction is, unsurprisingly, reflected in its composition: it can't even get the names of the affected regiments correct. It refers to 1/15 RNSWR, a mysterious unit that's never graced our order of battle. Perhaps he means 1/15 Lancers, the RNSWL?

The army trades on an enormous amount of freely devoted personal effort to generate the goodwill provided by these ceremonial units. All this is to be brushed away and dispensed with as part of a continuing drive for savings. And what’s the money re-invested in? Bigger salaries for the fat cats.

Once, a very long time ago, Swan actually stood for genuine reform. It will be interesting to see if by this evening Labor has managed to make more than a token effort to stop the obscene greed on display across the country.

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