Media Release - Trainee Treasurer and rookie Committee Chair give up on governing

The Liberal Party has given up on governing.

That’s why the trainee Treasurer has defied all Parliamentary conventions by asking the House of Representatives Economics Committee to solely focus on Labor’s proposed reforms to the Howard-era dividend refund scheme.

These proposed changes to the only fully-refundable imputation system in the world were announced by Labor in March.

Since that time, the chaos in the Liberal Party has resulted in no new ideas or policies to tackle stagnant wages growth while they are in Government.

Instead, Josh Frydenberg and the rookie Chair of the Economics Committee are playing silly and shallow political games by focusing on what will happen after the next Federal election.

It shows just how out of touch this Government is with the key issues facing our national economy. The House Economics Committee has a serious remit to inquire into Australia’s economic management and key regulatory entities like the Reserve Bank, APRA, ASIC, and the ACCC.

The Economics Committee should be focusing on why many costs for households and small businesses are going up and yet wages are going nowhere.

The Committee has previously written to the former Treasurer (now Prime Minister) explaining its priorities. These include looking into low wage growth and the effect on households and the Australian economy.

This important issue was raised 15 times when the Reserve Bank Governor Dr Philip Lowe appeared before the Committee recently:

“I have certainly been talking for a couple of years about the benefits of stronger wages growth” - Dr Phillip Lowe, Transcript of RBA Hearing, 17 August 2018.

The Committee also requested an enquiry into the whole Australian insurance industry, a call Labor renews in the wake of the appalling stories that continue to be told daily during the Royal Commission.

On Tuesday, the rookie Chair advised the Committee that the trainee Treasurer had requested an inquiry into dividend imputation reforms. This is a topic that has never been raised with the Committee by the Reserve Bank or any regulatory agency.

The vast majority of working Australians do not receive cash refunds for excess imputation credits. Analysis from the PBO shows that 92% of taxpayers in Australia did not receive any cash refunds for excess imputation credits in their 2014-15 tax return, while the majority of refunds go to wealthier households.

On figures costed by the Parliamentary Budget Office (PBO), Labor’s reform will save Australian taxpayers $10.7 billion over the forward estimates and $55.7 billion over a decade.

Labor will also ensure that all pensioners will still be able to access cash refunds from excess dividends imputation credits. Charities and not-for-profit institutions are excluded from the change.

The Parliamentary Committee system is an important feature of our system of governance. It should not be used for political stunts.

Australia faces a number of significant economic challenges including the persistence of wage stagnation at a time of weak consumer demand, record high household debt, and increasingly limited fiscal and budgetary capacity to respond to the next economic crisis.

Morrison and the Liberals have had five years to develop a plan to help reform and grow our national economy. Only Labor is ready to govern with positive policies to help all Australians. 

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