One of the problems of election campaigns is that politicians promise to do things. Much of the time those promises involve spending taxpayers' money on projects in marginal seats that provide marginal benefit to the community.
A promise not to do something can be as bad as a promise to do something. The phrase "over my dead body" is politically expedient, and it fulfils the immediate objective of getting either elected or re-elected. It is also one of the more irresponsible things to say.
Circumstances change and policies need to take account of that change. The problem is that if a politician doesn't absolutely and categorically rule something out, then inevitably their opponents raise the spectre of them having a "secret plan".
During the 1996 federal election campaign Ralph Willis, the then Labor federal treasurer, refused to guarantee that he would not raise taxes. He said he had no intention of doing so but he couldn't commit to what would happen in the future. His statement was entirely reasonable. In the context of an election campaign it was portrayed as "gaffe" and proof that Willis was a political ingenue.
While we haven't yet reached the halfway mark of the 2007 campaign we've already had one big promise on what won't happen. Both the coalition and Labor have said they won't review the GST rate or the way GST revenue is distributed to the states.
At the federal level the government and the opposition have been happy to castigate the states over service delivery, particularly in health. They haven't been willing to admit the current fiscal arrangements between the commonwealth and the states are a large part of the problem.
State governments have little financial incentive to improve their performance. And when they do improve they get criticised. For example, on most measures Victoria has the best public hospital system in Australia. Yet in its "report card" released a few days ago the Australian Medical Association complained that Victoria had the country's lowest per person recurrent expenditure on public hospitals. The reason that Victoria spent the least was because it was most efficient -- a relevant point which the association chose to ignore.
Any potential plan to overcome the "blame game" between the commonwealth and the states must inevitably include a consideration of the way the GST is collected and spent.
On Tuesday Treasurer Peter Costello and shadow treasurer Wayne Swan had their debate -- although to call it a debate is something of a misnomer, given that a debate normally requires some measure of disagreement. In that regard the debate followed the pattern of the campaign so far.
The best line of the day came from Costello: "Sometimes I wonder why Kevin wants to be elected when he wants to be so like John Howard".
Costello and Swan were in furious agreement on the issue of whether the allocation of GST funds between the states should be altered. Both said they would not change either the GST rate or the existing Grants Commission formula used to distribute the GST revenue. What both the coalition and Labor are saying is that the populations of NSW and Victoria will be required to continue subsidising the populations of Western Australia and Queensland, regardless of the economic performance of the latter two states.
The Labor MP for the NSW seat of Robertson, Belinda Neal, was right last week when she said a future ALP government should reconsider the way the GST is allocated.
A commitment from Labor to review the operation of the GST would be one of the more forward-looking promises of the campaign.
If the GST base was broadened, and if potentially the GST rate was increased, there would be scope to do what should have been done when the GST was first introduced, which is to substantially cut personal income tax rates. But Neal quickly withdrew her comments after the Prime Minister said that any change would inevitably lead to a higher GST rate.
In her retraction Neal said that: "Labor opposes any increase in the GST rate, expansion of the GST base or changes to the process for distributing the GST".
For good measure Kevin Rudd added that any increase to the GST would be "over my dead body".
It's a pity he was so unequivocal. One can only hope it is not a promise he lives to regret.
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