Correction:

Crikey writes: A story on newspaper circulation figures on in Crikey Friday reported Sydney’s Sunday Telegraph “shed a large 4.8% in the quarter”. The correct figure was in fact half that at 2.4%. We apologise for the error.

Tax:

Dr Stephen Kirchner, School of Finance and Economics, University of Technology Sydney, writes: Re. “Our tax expenditures are world-beating, but are they effective?” (Friday, item 9). Bernard Keane wrote: “Every year the government forgoes more than $100 billion in tax revenue courtesy of exemptions and concessions in the tax system.”

This is an all-too-common journalistic error that stems from a misreading (or failure to read) the Treasury’s Tax Expenditures Statement.

Here is how Treasury describes its methodology:

“The estimates of tax expenditures in this statement are prepared under the ‘revenue forgone’ approach which calculates the value of tax expenditures in terms of the benefit to the taxpayer of the tax provisions concerned…

Revenue forgone estimates differ from budget revenue estimates because they are estimated relative to different benchmarks … It does not necessarily follow that there would be an equivalent increase to government revenue from the abolition of the tax expenditure.

…the revenue forgone approach requires only a single consistent assumption regarding behavioural responses to removing a concession (no behavioural change) which allows the value of a tax concession to be based on the actual (or projected) level of transactions.”

The critical assumption of no behavioural change invalidates Keane’s inferences about the implications of various tax expenditures for budget revenue.

Recruitment freezes:

Niall Clugston writes: Re. “Liberal savings initiatives — Abbott rediscovers old-time religion” (Friday, item 8). Recruitment freezes are even worse than Bernard Keane says.

At face value, they create random staff shortages, regardless of how important the vacant positions are. But in the long term the effect is worse than random. The more skilled and experienced employees tend to be the ones who leave, especially now they face a frustrating work situation and no opportunity for promotion, leaving the organisation with those staff who have nowhere else to go.

Then you have the possibility of vicious cycles. Workers in sections hardest hit by staff shortages suffer greater stress and are more likely to leave, sending their workplace in a downward spiral of fewer and fewer employees.

But governments love recruitment freezes because they’re “painless”.

Funding our athletes:

Arley Moulton writes: Re. “As athletes, we’re grateful for extra pocket money from Budget” (Friday, item 18). I’m so glad we’re spending $195 million in new funding so that I get a warm fuzzy feeling once every four years when some guy I’ve never heard of spins around and throws a dinner plate the longest distance for a gold medal.

If we’d instead pump all the money into local community sports then we might not be a country full of obese people. Sports such as discus doesn’t encourage me to get off my ass. And wrestling makes me feel dirty. And taekwondo? Come on! Or how about kayaking! Do we really need to spend this much money on these sports?

Watching Gary Ablett hold a premiership cup and making sure that the NRL clubs can pay our real athletes a fair days wage is a thousand times more important to me than Steve Hooker’s gold medal. I can’t remember who else has gold medals because I don’t care!

News Ltd:

John Memma writes: Rupert really has upped the ante in his war against the ALP — his Saturday papers carried little or no coverage of Abbott’s cringe worthy “wimp” admission (from the ironman who would be PM), nor did they highlight the fact that Abbott was rolled by his own party room on a big economic measure he wanted to adopt.

In fact, if you missed Friday’s TV or radio news and relied on The Australian or Rupert’s other Saturday dailies, you might not be aware that even Abbott’s own party room is rejecting his hare-brained policies — which is a huge story for the obvious reason that if his own party colleagues don’t trust Abbott with the economy, why should voters?

Of course, the Saturday News Ltd papers were loaded up with the usual attacks on Rudd and Labor policies. It seems “News” is now openly operating as Abbott’s PR and spin machine.

Thomas Kossmann:

Sports Physician John Orchard writes: Re. “Trial by media goes for the doctor: come up empty handed” (11 May, item 17). Much of what Greg Barns has written about Thomas Kossmann is fair comment. A surgeon who was leading in his field had his clinical competence publicly questioned and with the passage of time, many of these accusations have been shown to have been unfair.

However, there was a aspect of the Kossmann affair which the media appears to have gotten right and the regulatory bodies appear to be deficient. Kossmann was accused of gross over-billing and seemed to have only one defence against this accusation — that such practices were rife within the surgical profession and he was only following standard practice of his colleagues.

These apparently included billing for operating on multiple patients at the same time, for dozens of procedures on the same patient at the one sitting and even billing for operating on patients in Australia whilst out of the country. If the regulatory bodies have not taken firm action on this conduct then it appears they are toothless. It is obviously a problem that extends far beyond Kossmann and it should be a big issue for the government and private insurers as to how to end this endemic fraud without losing too many surgeons from the profession.

In a situation where the regulatory bodies are impotent or corrupt then it is only the media that can drive reform.

Naplan:

Marcus L’Estrange writes: Re. “Tips and rumours” (Friday, item 6). Your tipster asked “Who’s sitting out the NAPLAN tests? ” A good question, but much of the comment about Naplan test shenanigans has missed a key point and that is all the state governments policy of automatic promotion of students from one year to the next.

Students don’t have to pass any exams, do any work or behave in order to go from one year to the next or to their next level of incompetence. In my Yr 11 class last year I had many students who were really at the Yr 6/7 levels standard.

Mixed ability/motivation/behaviour classes are a disaster for those who want to learn. Having Yr 6/7 level students mixed in with say a Yr 11 level class which is very common the poor teacher is then supposed to run up to 4- 5 different classes within a 45 minute class with each student receiving about a minute of individual tuition, if that. If all classes had students of the same standard all students would then get 45 minutes of tuition vs. one minute at present.

This is the key reason why many students are encouraged to stay home and not do the Naplan test. Some Principal’s don’t want the full story of how bad things really are and that 46% of students are functionally illiterate. It is also the real reason why Naplan faced so much AEU opposition and why the very idea of real transparency horrifies many in the industry.

Bruce Guthrie:

Liz Johnston writes: Re. “Guthrie wins out in unfair dismissal case, judge slams Harto & Blunden” (Friday, item 1). Three cheers for Bruce Guthrie and Justice Kaye on behalf of all those who have been bullied, belittled, lied to and sacked by News.

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