Wry & Dry

Napoleon Turnbull decides something!

W&D calculates that it's 177 days since Napoleon Turnbull became Australia's 29th Prime Minister.  And until Wednesday his government had made zero important policy decisions.  

Consider this.  It costs we-the-taxpayer some $1.1 billion [3] each year to run Planet Canberra.  W&D's abacus calculates that is about $62m per day.  Ideally, we would want PC to do less.  Not more.  But sometimes, governments have to do stuff.  And we-the-taxpayer expect them to do stuff, given the declining economic well-being of this blessed plot [4].

And so W&D was delighted to see the smiling dial of Assistant Treasurer, Kelly O'Dwyer on the front page of the Financial Review, as she announced that the government had decided on an 'objective' for superannuation.

As mandatory superannuation became law in Australia in 1992, it's taken governments of all persuasions a mere 24 years to decide that 'superannuation' needed an objective.  The government's proposal is that superannuation's primary objective be: 'to provide income in retirement to substitute or supplement the age pension.'

Sort of obvious.

But W&D's capacious nose sniffs more.  Read what Ms O'Dwyer next said, "No-one has a right to a super tax concession.  It is a gift that the government should only provide when it makes sense."  

Aside from Ms O'Dwyer's laziness in using the word 'super' when she should use 'superannuation', W&D senses two outcomes.

Firstly, a warm-up to a decision to reduce some superannuation tax concessions.   

Secondly, and something W&D has not seen elsewhere (come to expect that), a very clever move.  All the faffing around that we have seen about changes to superannuation tax rates, etc has mostly come from the industry and think-tanks.  The government has allowed the chooks [5] to run around.  

chooks

It can now, following O'Dwyer's announcement, say clearly that one cannot consider changing the tax regime of superannuation until it is clear what the objective of superannuation is.

That is, only by firstly making it clear the function of superannuation can the government then consider an appropriate concessional taxation regime.  

Perhaps Ms O'Dwyer is smarter than some think.