Page 1233 - Week 04 - Wednesday, 9 April 2008
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limited fixed income, people employed on low to middle incomes living in the private rental market and especially people with families and couples with children buying their first house. The notion of the working family leaps to mind here.
The evidence is continuing to accumulate that things are getting harder for quite a number of Canberra people. No matter how they manage their affairs, if they use power or the telephone, they will be carrying the burden. People on low or limited incomes find that power and phone bills are a higher proportion of their revenue than those of us, such as politicians and public servants, who earn significantly more. Furthermore, the costs of rent or mortgages and of transport have also increased at a significantly greater rate than, say, pensions have.
I am aware that the ICRC, the pricing regulator, explicitly mentioned a commitment by the ACT government to ensure that people on low incomes would be compensated for the impact of this tax. The ACT government has failed to deliver on that commitment. I note, however, that the ACT government has finished a review of concessions. Since it was my motion in the Assembly which produced that review, I am extremely interested in its outcomes.
I anticipate a more comprehensive and robust approach to providing concessions for people who are disadvantaged due to income levels, health status or disability or are otherwise in need. I imagine that we will see that emerge in the next pre-election budget. Perhaps the promised compensation for this unfair and regressive extra tax will be tucked into that response, but I do not think that is good enough.
I am also aware that the Essential Services Consumer Council has written to the Attorney-General asking him to recommend that the tax be abolished. The Essential Services Consumer Council made the same points about the inequity of the tax that I have already pointed to. It emphasised the impact of the tax on electricity price rises in the past year and the overall increase in the basic cost of living for people on limited incomes as opposed to the average increases in their income. It also made the point that people on controlled or regulated electricity contracts could be assured of having the cost reduction passed on to them. The Independent Competition and Regulatory Commission could and would simply require the utilities to direct the savings to customers.
If we were to abolish or reduce other taxes and charges that might or might not be equitable, the savings may not flow back to the worst affected consumers. Nonetheless, in a more thoughtful environment we would see an integrated and more considered approach to changing the revenue mix.
I have the same criticisms of this initiative now as I had of the ACT government when it first introduced the tax. At that time, I argued that income and revenue measures ought to be designed to have a progressive impact on ACT residents and on our environment. Rather than simply restructuring or introducing new revenue measures, a plan based on a social environmental impact analysis needed to be prepared. Similarly, in this case, rather than simply abolishing a tax, a more sophisticated look at how to put some charge on utilities who use ACT government resources might have been investigated.
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