It was as good an example as you’ll get of how the Prime Minister is damned if she does and damned if she doesn’t. Having resisted the very kind offer of Liberal premiers to commit to a tax rise in order to fund the National Disability Insurance Scheme — a move that would hand Tony “great big new tax” Abbott a handy campaigning tool — Julia Gillard is under fire from some commentators for failing to deliver. It’s not hard to imagine what those same critics would have been complaining about if she had committed to a rise in personal income taxes.
The Productivity Commission recommended the Scheme be funded from general revenue but, sensing a lack of political will on either side for the sort of deep, politically brave cuts that would deliver the $6-7 billion a year needed for a fully effective NDIS, the PC had a fallback position: a Medicare-style personal income levy. Other types of taxes were rejected as too inefficient — especially payroll tax (urged by Deloitte Access Economics earlier this year) and company tax.
One of the most efficient options would be to overhaul the GST by removing some of the sillier exemptions to it that cost $4-5 billion a year. The political will there, however, is even less than for big spending cuts.
There are politically unpalatable options all round for funding the NDIS. At some point a politician will have to tell voters they can’t have everything they want, and they need to pick and choose what services or handouts they want cut if, as everyone seems to agree it must, the dignity and security of disabled Australians and their carers becomes the priority for our governments they should always have been but never have.
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