30 Apr 2013

But the government spends too much in Australia

The government spends too much.

Edited Tim Colebatch Article

 All of us can think of areas where we think it should cut spending. Equally, we can all think of areas where it should spend more.
The International Monetary Fund estimates that, excluding east Asian countries where welfare is left to the family, Australia already has the second lowest spending of any Western country, behind only Switzerland.

We will have to spend more in future, as our population ages, and more of baby boomers are supported by taxpayers for healthcare, age pensions and nursing homes, while paying little or no tax.
We will have to spend more, one way or other, if we are to get the transport infrastructure we want.

The Gillard government has been financially game in hoping or pretending that our current tax base can support our current spending, even though a year ago it probably would have, now it is not so.

There are looming increases in spending for the aged, then money for the Gonski reforms to school spending (I'm sure this could be phased in over a longer period)and the national disability insurance scheme, both are very important but the time frame is the problem.

Something's got to give. We cannot support this level of spending while this is the level of revenue is being raised.

Whether you support deep spending cuts or serious tax rises, or a combination of both, is a matter of political preference. We should look for both.

In the end, it's not the deficit that matters, it's the economy which in its self is still strong.

Britain's new Tory government has put its economy into recession by trying to get rid of a budget deficit at any cost.

Let's hope the Coalition doesn't go down that path and over react. We won't know until it lays out what it would do.

Their parental leave scheme is ridiculously generous and I am sure they are kicking themselves for ever mentioning it!

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