AUSTRALIAN GOVERNMENT DEBT

In just 13 of the past 40 fiscal years have Australian Governments spent less money than what they have generated as income through tax receipts and other income sources. Since 1975, budget deficits have occurred 68% of the time but whenever the topic is reported in the media, it is typically the most current fiscal year end performance that receives the most attention and whether it’s a Deficit or Surplus.

Seldom, does the running debt amount in total dollars receive the attention it deserves. Most analysts refer to total debt as a percentage of GDP…. How convenient, that the Government’s mishandling of the public purse is measured against the output of all businesses and all individual PAYG taxpayers.

Percentage Debt of GDP dilutes the size of the total debt (risk) against an enormous number which in turn implies that total government debt is comparatively low when compared to other countries/governments across the globe, who incidentally use the same measure to gauge their levels of debt.

Any Australian wanting to borrow money from a bank to buy a House, Car or other item of significant value, must undergo financial institution scrutiny on how much money is earned as an individual/couple to justify the loan amount. Australians are not allowed to ‘pool’ their income across siblings, parents, grandparents, cousins, aunts & uncles, just their own income.

If borrower income is not within an acceptable range, loans will not be approved and herein lies the understanding of responsibility and accountability to spend or borrow within one’s means.

The Australian Government, specifically its ministers, are not held accountable for excessive spending that contributes to a higher annual debt amount because the scrutiny is not based on Government income but on the income of the entire nation. On top of that, if there isn’t enough money available to borrow, all the government has to do it to pass legislation that increases the nation’s debt ceiling, so that it can continue borrowing.

Government ministers are all about self-preservation no matter what the cost, so long as they get to keep their jobs, their titles and above all else, their salaries & benefits, they will promise whatever to whoever, whenever, if it secures them the votes they need. Irrespective of how high the debt amount is, all previous and current prime ministers, treasurers and other ministers are not lying awake at night worrying about the legacy of burden they’re leaving for the years ahead, they couldn’t care less. They’re gouging Australia’s wealth for themselves.

It’ll be someone else’s problem to handle when it all comes crashing down. That’s when the ‘executive powers’ will come into play, where the Government will be able to ‘freeze’ bank withdrawals, prevent retirees retrieving funds from their Superannuation, introduce new taxes and remove tax deductibility on a swag of items all for the sake of the National Interest.

The Government can’t lose, but all Australians will.

1. Percentage Debt of GDP Measure to be replaced with Percentage Debt of Federal Government Receipts
2. Total Federal Government Debt must not exceed 150% of Federal Government Receipts ($610 Billion)
3. All Government Ministers from the Prime Minister down must be held accountable for the budgets they are responsible for.

This means that overspends are no longer tolerated and any incumbent front/back bench ministers that fail to deliver balanced budgets will:

• Lose their overseas study tour travel allowances
• Forfeit their Life Gold Pass of Free Business or First Class travel within Australia with their spouse (or for ministers who don’t qualify for a Life Gold Pass where the
  severance travel package provides up to 50 flights in 5 years after they have left Parliament)
• Have a 50% Salary Reduction (until the deficit is restored to balanced)
• Incur fines in the hundreds of thousands of dollars including personal asset sequestration

Being held accountable means that there are penalties for the misappropriation and/or failures to deliver reduced budgetary deficits and possibly even more surpluses.

More of the same so don’t expect any change on this front until the next Global Financial Crisis. Successive Australian governments have demonstrated that they can’t be trusted with money as they continue to spend whatever it takes to win office or to remain in government.

Real change on this front can only come from ……a Revolution……………

Australian Government – Archive of Budgets
Australian Government – National Archives of Australia
Australian Government – Finance
SMH Full List of Federal MP Entitlements