uni cuts budget 2017

If you missed it, the Financial Review‘s Phil Coorey had one of the more remarkable political stories of recent years on Friday. He revealed why the government is about to pump at least $1 billion into the Melbourne-Brisbane Inland Rail, a boondoggle that has been spruiked by the Nationals for 20 years or more, and which the government itself admits, even under optimistic assumptions, will barely produce as many benefits as costs. According to Coorey, funding was to assuage the Nationals who were upset because regional aviation to Sydney is likely to be forced out to the new Badgerys Creek Airport, whenever that gets going.

Regional aviation is a huge problem at Sydney’s main airport in Kingsford Smith; small regional flights take up slots that could be used by much larger aircraft on domestic and international flights, dramatically increasing the costs of congestion at the airport. Worse, regional aviation doesn’t have to pay full price for slots, meaning they’re cross-subsidised by the rest of us (you can bet the gouging, rapacious Sydney Airport Corporation makes sure of that).

The Nats know that once Badgerys Creek is built, there’ll be no excuse for allowing regional aircraft to use up the slots of commercial aircraft at Kingsford Smith. But the old white men of the Nationals hate the idea of having to travel from Badgerys Creek into Sydney. Indeed, efforts to expand Bankstown Airport (the second-biggest airport in Sydney after Kingsford Smith) used to be opposed because of complaints about having to travel from there — so Badgerys Creek is far worse.

So, because the Nationals don’t want to have to sit on a train or drive on the M7 into the Sydney CBD in the 2020s, the government is going to waste $1 billion on a train line to nowhere. It could be the most absurd piece of pork-barrelling in the sordid history of that practice in generations — quite a feat.

And while the government is wasting $1 billion on stroking the Nationals’ sense of entitlement, it is returning to the scene of one of the major defeats of the Abbott government: its higher education “reforms” that failed to pass the Senate and gave Labor and the Greens ammunition for a remorseless attack on “$100,000 degrees”.

[Super for housing: the latest example of our war on the young]

Education Minister Simon Birmingham is going to have a go at attempting what predecessor Christopher Pyne failed to do — although unlike Pyne, Birmingham won’t be springing changes as a complete surprise on the sector like Pyne did. After heavily foreshadowing another go in recent weeks, Birmingham will today reveal a cut-down version of the same package: funding cuts for universities (to be termed an “efficiency dividend” — remember when Tony Abbott insisted cuts to the ABC weren’t cuts, but an “efficiency dividend”?), higher fees for students and a more draconian student loan repayment regime. Universities, we’re told, are rolling in money and don’t need any more.

How much will be saved? It’s not yet clear, but one figure in the media is around $1 billion. It’s possible that the government’s attack on higher education will be effectively paying for the inland rail boondoggle.

What is clear is that next week’s budget looms as a continuation of this government’s war on young people. They will face higher education fees and higher education loans debts, receiving an education in more poorly funded institutions the government sees primarily as degree factories for the valuable export of international students (who, coincidentally, make for a great source of exploitable labour). And what was once to be the centrepiece of the budget, housing affordability, has been shelved except for, perhaps, the restoration of an unsuccessful Labor program to encourage saving and transferring yet more money from young people to baby boomers by allowing the use of superannuation for housing. Meaningful reform, which even if the government rejected negative gearing changes, could involve reductions in the capital gains tax concession for housing investors, looks to have been ditched.

Instead of housing affordability, infrastructure is now being sold as the budget centrepiece (there’ll also be the now-standard “welfare crackdown”, the fourth or fifth of this government alone; crackdowns on the poor, like the poor themselves, will apparently always be with us).

The inland rail route has long been touted as “visionary”. Likely, that word will be dragged out again in relation to any PR for the wasting of government funding on it. But the vision at the heart of the budget seems, for young people, a quite different one: a future in which they carry high five-figure or six-figure education debts into their careers, then need to take on seven-figure debts to find somewhere to live even vaguely close to economic centres where they can use their skills. This is an economic war on our youth, and one they should never forgive us for.

 

Peter Fray

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