The Australia Institute Feed Items

Key Points:

• Expenditure caps should account for the taxpayer-funded incumbency benefits MPs enjoy that their challengers do not:
  • Parties that run candidates in most or all seats and in both houses of Parliament can “pile in” funding to target areas, effectively allowing them to exceed the spending cap.
  • New entrants have fixed costs that established parties can spread across many seats, meaning new entrants must spend more to catch up to a major party rival.
• If parties are to receive administrative funding from the taxpayer, it should be based on the actual costs of running a political party – not how many MPs a party has.
• In South Australia, major parties are less dependent on political donations than new entrants because the parties receive significant public funding:
  • Premier Malinauskas has flagged changes to public funding to make allowances for new entrants, who under current laws cannot access public funding until the election is over.

“It is heartening that Premier Malinauskas has identified a level playing field for new entrants as the number one concern of political finance reform, even ahead of a possible High Court challenge,” said Bill Browne, Director of the Australia Institute’s Democracy & Accountability Program.

“South Australia has a proud history of electoral reform, including universal suffrage and preferential voting. The Malinauskas Government’s new bill could follow that legacy, but only if it safeguards diverse voices.

Isn’t a surplus in the current economic climate a good thing? What causes productivity growth? And how do other nations measure unemployment? On this episode of Dollars & Sense, Greg Jericho answers your questions and explains why some commentators are getting giddy for Canadian rate cuts.

Greg Jericho is Chief Economist at the Australia Institute and the Centre for Future Work and popular columnist of Grogonomics with Guardian Australia. Each week on Dollars & Sense, Greg dives into the latest economic figures to explain what they can tell us about what’s happening in the economy, how it will impact you and where things are headed.

Host: Greg Jericho, Chief Economist, the Australia Institute and Centre for Future Work // @GrogsGamut

Producer: Jennifer Macey // @jennifermacey

Theme music: Blue Dot Sessions

To hear Machiavelli tell it, 16th century Italy was plagued by expensive, flashy contractors who bled the public, failed to deliver what they promised and then turned around and robbed the ones who paid them.

Those faults will ring a bell for those who have followed the consulting firm scandals exposed over the past year, including misusing government secrets and taking money for buried reports. With the inquiry into the NSW Government’s use and management of consulting services releasing its damning findings earlier this week, and the Senate inquiry into consulting service integrity due any day now, fresh light has been cast on the behaviour of these large, well-paid government contractors – and the picture is no prettier than it was in Machiavelli’s day.

Of course, by contractors Machiavelli meant the mercenary captains whose private armies did most of the city-states’ fighting, but the word, condottieri, literally means contractors, and the parallels are remarkable.

Like the mercenaries, today’s consultants favour style over substance. Academics Mariana Mazzucato and Rosie Collington call this “the Big Con”: the undeserved confidence of consultants tricks clients, journalists, politicians and the public into placing more trust in their words than they deserve. The Renaissance equivalent was for mercenary companies to fight flashy but ineffectual battles. A colourful, if apocryphal, tale has it that at the 1440 Battle of Anghiari mercenary companies fought round the clock with only one death: when a soldier fell off his horse.

This American presidential election will be unique for many reasons, not the least of which is Donald Trump becoming the first American president to be found guilty of a crime. So what impact – if any – will that have on the outcome? Is Biden going to be able to mobilise enough support in key states to win a second term? And what might another Trump presidency mean for Australia? On this episode of Follow the Money, the Australia Institute’s Emma Shortis joins Ebony Bennett to discuss US politics after her recent trip to Washington DC.

This discussion was recorded on Tuesday 11 June 2024 and things may have changed since recording.

Guest: Emma Shortis, Senior Researcher in International & Security Affairs, the Australia Institute // @EmmaShortis

Host: Ebony Bennett, Deputy Director, the Australia Institute // @ebony_bennett

Producer: Jennifer Macey // @jennifermacey

Theme music: Pulse and Thrum; additional music by Blue Dot Sessions

The report shows superannuation tax concessions help high income earners avoid tax, exacerbate income and gender inequality and come at a huge cost in foregone revenue, and recommends ending or at least limiting superannuation tax concessions for the top 10% of earners and those whose high super balances do not meet the asset criteria for the part pension.

Key findings:

• Super tax concessions cost $54.56 billion in foregone revenue during 2022-23, and disproportionately benefit the wealthy:
  • The top 20% of income earners receive more than 50% of superannuation tax concessions.
  • The share of Australian workers with a super fund above $1 million is just 2.5%, but those people made 20.1% of all personal super contributions in 2020-21.
• Removing the tax concession for both super contributions and earnings from the top 10% of earners would save more than $12 billion every year.
• Women retire with a super savings gap of nearly 25% compared with their male counterparts.
• Australia still experiences above average rates of poverty in retirement (6th highest rate of retiree poverty in the OECD)
• Superannuation tax concessions are forecast to overtake the cost of the age pension in 2045-46.

“While super tax concessions are designed to help all Australian workers saving for retirement, the distribution of these benefits is incredibly unequal,” said Dr Minh Ngoc Le, a postdoctoral research fellow at the Australia Institute.

In the latest Labour Accounts released today by the Bureau of Statistics a record, 1.106m jobs held in Australia are being worked by someone who has another job.

The more than 5% fall in real wages over the past 3 years as inflation has soared above wage growth has meant that a record 7.1% of all the jobs in Australia are someone’s second or third (or more) jobs. In the March quarter some 974,000 Australians were working in more than one job. This disparity between the number of employees working multiple jobs and the total number of “secondary jobs” implies that there is now a record number of people as well working more than 2 jobs.

This is not a sign of a healthy labour force.

While it is good that Australians are able to find work, that nearly 1 million are clearly needing to seek more hours form a secondary job suggests that there has been growing problem of working poor.

In the past year, 13% of the new jobs created have gone to someone who already has a job. Until wages consistently grow fast the prices, this trend of ever-increasing proportion of workers taking on another job to make ends meet will continue.

Particularly concerning is the increase in multiple job holders is occurring among older workers. Historically younger workers are more likely to work more than one job, but over the past year, the percentage of workers aged 35-44 holding more than one job has risen from 6.7% to 7.2%.

Since the Intergovernmental Panel on Climate Change (IPCC) released their First Assessment Report in 1990, the Australian Government has subsidised fossil fuel consumption through the Fuel Tax Credits Scheme to the tune of over $200 billion. This year, the OECD called for an end to this long-standing fossil fuel subsidy.

Australia charges a fuel tax (also called a fuel excise) of around $0.49 per litre for common fuels like diesel and petrol. The Fuel Tax Credits Scheme (FTCS) offers a refund of this tax to certain fuel users.

The FTCS meets the World Trade Organisation’s criteria for a subsidy, as it involves government revenue that would otherwise be due, but is foregone or not collected.

The WTO is not alone in viewing the fuels tax credits as a subsidy. As our recent report highlighted, the OECD, the International Energy Agency (IEA), the International Institute for Sustainable Development (IISD), Overseas Development International (ODI) and Oil Change International all recognise the FTCS as a fossil fuel subsidy.

But more importantly, not only is it recognised as a subsidy, it is also recognised as a subsidy that should end.

While it is true that the super scheme helps many people save for their retirement, the scheme disproportionately benefits wealthier Australians. Superannuation tax concessions come at a huge cost in foregone revenue that is growing so quickly they will soon become more expensive than the age pension. In coming years, the solution will become worse than the problem.

Reform is needed to ensure these concessions are limited to those who really need them. The income level or super balance at which tax concessions cut out should be lowered. This would lead to significant savings in forgone revenue, reduce inequality, and significantly increase the ability of the Commonwealth Government to properly fund the age pension system.

The post Who benefits? appeared first on The Australia Institute.

The Wrap with Ebony Bennett

Senator David Pocock made headlines last week when, in a press conference at Parliament House, he called gas companies “leeches” that are getting away with “state-sanctioned daylight robbery”.

As Dr Monique Ryan said, “We are allowing multinationals to take our oil and gas and sell it off overseas at massive, massive profits and not pay tax.”

New Australia Institute research shows that governments charge no royalties on 56 per cent of the gas that’s exported from Australia.

Gas companies are getting away with state-sanctioned daylight robbery.

The value in Australian gas should be used to build a better future for Australians, not to inflate the profits of multinationals. pic.twitter.com/wD5XU5WG0N

— David Pocock (@DavidPocock) May 30, 2024

This means that Australians have missed out on at least $13 billion in royalties over the last four years.

Remember that figure next time governments tell you that they can’t afford to spend more on social housing, increasing Jobseeker or supporting victims of domestic violence.

Treasurer Jim Chalmers said “any growth is welcome” at his recent press conference on Australia’s March quarter economic performance.

But the Treasurer was surely hoping to welcome a little more than the 0.1 per cent gross domestic product (GDP) growth we got.

“It’s really hard to sugar coat this,” said Australia Institute Chief Economist Greg Jericho.

“It’s a rounding error away from nothing.”

The story gets worse when you exclude population growth, with GDP per capita falling 0.4 per cent in the March quarter.

“That was the fifth quarter in a row that our economy has contracted on a per capita basis,” Jericho said.

“The last time that happened? Ah, it’s never happened before…”

Treasurer Chalmers described the weak growth as “the inevitable consequence of these rate rises which are in the system.”

Apparently the RBA thinks there is too much demand in the economy. Have they seen the latest GDP figures????

My column. https://t.co/qKdhTKzKXr

— Greg Jericho (@GrogsGamut) June 5, 2024

• The final report of the Robodebt Royal Commission was delayed in order to allow the Royal Commissioner to refer individuals to the NACC.
• The NACC’s decision to not investigate these public officials means further details about how Robodebt happened and who was responsible may not come to light and preventative measures may not be implemented.
• Gaps in government accountability in Australia include that:
  • The NACC can only hold public hearings under “exceptional circumstances”.
  • Whistleblowers in Australia are vulnerable to retaliation and prosecution, hampering anti-corruption investigations.
  • According to the APS Employee Census, 3,800 public servants witnessed potential corruption last year, and two-thirds of them did not report it.

“The NACC’s decision to not investigate Robodebt makes the Public Service Commission responsible for investigating these alleged wrongdoers and addressing the broader cultural problems exposed by the Royal Commission,” said Bill Browne, Director of the Australia Institute’s Democracy & Accountability Program.

“Australians will wonder why there is a disconnect between the Royal Commissioner, who delayed her report so she could refer potentially corrupt conduct, and the NACC, which decided that it was not in the public interest to investigate that conduct.

Across the country, house prices have skyrocketed, putting the prospect of buying a home well out of reach for too many people. Rents have also soared, placing huge financial pressure on people and pushing many into homelessness. On this episode of Follow the Money, housing advocate and creator of shitrentals.org Jordan van den Berg, Maiy Azize from national housing campaign Everybody’s Home, and Australia Institute Senior Economist Matt Grudnoff examine how Australia got itself into this situation – and how it can get out of it.

This discussion was recorded on Tuesday 4 June 2024 and things may have changed since recording.

Guest: Jordan van den Berg, Lawyer and Founder of shitrentals.org // @purplepingers

Guest: Maiy Azize, National Spokesperson, Everybody’s Home // @MaiyAzize

Guest: Matt Grudnoff, Senior Economist, the Australia Institute // @MattGrudnoff

Host: Ebony Bennett, Deputy Director, the Australia Institute // @ebony_bennett

Producer: Jennifer Macey // @jennifermacey

Additional editing: Emily Perkins

After multiple interest rate increases in recent years, it’s the economy – not inflation – that’s slowing, with the latest figures showing that the Australian economy grew just 0.1 per cent in the last quarter. So why is gross domestic product (GDP) growth so hard to come by at the moment? On this episode of Dollars & Sense, Greg Jericho discusses Australia’s fragile economy and how governments – and the Reserve Bank – can respond.

Greg Jericho is Chief Economist at the Australia Institute and the Centre for Future Work and popular columnist of Grogonomics with Guardian Australia. Each week on Dollars & Sense, Greg dives into the latest economic figures to explain what they can tell us about what’s happening in the economy, how it will impact you and where things are headed.

Host: Greg Jericho, Chief Economist, the Australia Institute and Centre for Future Work // @GrogsGamut

Producer: Jennifer Macey // @jennifermacey

Theme music: Blue Dot Sessions

On paper, the Australian Government’s Future Made in Australia plan is a great idea, making Australia a renewable energy superpower, with more capacity to make clean energy at home and for export.

But simultaneously, the Government is planning for “gas to 2050 and beyond“.

It’s a contradiction that has the potential to undermine our aspirations to become a renewable energy superpower.

Polly Hemming, Director of the Climate & Energy Program at the Australia Institute, unpacks the words and actions of the Government to paint a full picture of the plan for Australia’s energy future.

“Gas Industry Leeches”

We recently held a press conference with independent MPs David Pocock and Dr Monique Ryan, launching a new report showing that 56% of gas exported from Australia attracts zero royalty payments, effectively giving a public resource to multinational gas corporations for free.

The anti-siphoning laws, Communications Legislation Amendment (Prominence and Anti-siphoning) Bill 2024, currently before Parliament give free-to-air broadcasters the first opportunity to acquire broadcast rights for sporting events such as the AFL and the Olympic Games, however are currently limited to aerial coverage only (i.e. does not cover broadcasters’ digital streaming services.)

Key Findings:

• Majority of Australians (56%) support extending anti-siphoning laws to cover digital rights as well as aerial rights, with one in five (21%) Australians voicing strong support for extending the laws (only 12% oppose).
• Sports currently on the anti-siphoning list include the AFL, the Melbourne Cup and Australian Open, Test cricket, and the Olympic and Commonwealth Games.

“Sport plays an important role in Australia’s social fabric, and it’s clear Australia’s anti-siphoning laws need to be updated to keep pace with modern viewing habits,” said Rod Campbell, Research Director at the Australia Institute.

“Given the rise of digital streaming, Australians rightly expect free-to-air sport to be available in the manner which they consume it. It is nonsensical in this day and age to differentiate between free-to-air television broadcast via aerial and free-to-air television broadcast by digital app.

The results show that most Australians support extending anti-siphoning laws to cover digital rights as well as aerial rights.

The post Polling – Anti-siphoning laws appeared first on The Australia Institute.

Australia’s addiction to consultants extends from the public sector to public universities. The final report of the NSW Government inquiry into the use of consultants was released last week. The number one finding is that there is no clear and readily available public record of exactly how much the NSW Government spends on consultants – far from encouraging. If this is the situation for the NSW Government, then what does it look like for Australia’s public universities?

Public universities in Australia spend big on consultants. In 2023, universities in two states alone spent $209 million on consultants – Victorian universities spent at least $72 million while Queensland universities spent a whopping $137 million. Compare this to 2022, when just ten universities across the country spent $249 million on consultants. With amounts like these, is it any wonder then that universities have been accused of being captured by private consultancies? In the meantime, consultancy companies are increasingly partnering with universities to deliver programs, making their continued use more likely.

Oil and gas lobby group Australian Energy Producers (AEP) has published a media release claiming “record” government payments, with “industry expected to pay $17.1 billion in taxes in 2023-24”.1 This briefing note provides context for the AEP claim, and makes other criticisms such as the conflation of royalties and taxes and the unreliability of lobby group data.

The post Gas industry claims debunked appeared first on The Australia Institute.

Over the last four years, $111 billion worth of liquefied natural gas (LNG) was exported from WA, derived from royalty-free gas.

Key Findings:

• Around 90% of gas produced in WA is exported as LNG, mainly extracted from Commonwealth waters.
• No royalties are paid on 73% of the gas that is exported from Western Australia.
• No royalties are paid by Chevron’s Wheatstone and Gorgon LNG, Woodside’s Pluto LNG and Shell’s Prelude LNG.
• LNG worth $111 billion was exported from WA, royalty-free, over the past four years.
• Royalties are only paid on gas from the heavily-subsidised North West Shelf and onshore fields.
• At least $9.6 billion in revenue could have been made if royalties had been charged on royalty-free gas over the last four years.

“Many Western Australians will be shocked to realise that a large portion of WA’s gas is given away, essentially for free,” said Mark Ogge, Principal Advisor at the Australia Institute.

“In the words of WA Treasury, ‘a royalty is the purchase price for a community-owned resource,’ and ‘the community expects a fair return for its petroleum resources’.

“However, in many cases Western Australians are getting no return at all for the sale of their gas.

“This is a narrative that Trump has been running for a long time, saying that the Department of Justice is in particular, but the entire security state is completely corrupt.”

“Trump has been really effective at weaponising that narrative and in galvanizing his base in particular.”

– International & Security Affairs Senior Researcher Dr Emma Shortis on ABC News

The post Trump Already Weaponising Guilty Verdict | Video appeared first on The Australia Institute.

Inflation is stubbornly staying above the Reserve Bank’s target, but it’s not because Australian consumers are flush with cash, according to Australia Institute Chief Economist, Greg Jericho.

In fact, retail spending figures suggest that people are struggling and further suppressing consumer demand by increasing interest rates could have a detrimental effect on the economy, Jericho said on the latest episode of Dollars & Sense.

“Pretty much since December, inflation has been stuck at that 3.5, 3.6 per cent area.

“Whereas, before that, it had been coming down fairly steadily.

“And so, some economists are getting rather panicky about the fact that inflation is ‘sticky’.”

But that’s not the full picture, Jericho said.

“What I care about as an economist is: are consumers out there spending like mad? And, as a result shop owners are going ‘wow, I’ve got lines around the block – I can raise prices’.

“But what we see in the retail spending figures is that we are not buying much at all.

“That is a real sign that we are not flush with cash, we are not doing well – households are really struggling.”

Among many landmarks was the 1995 establishment of the National Competition Council (NCC) by the Commonwealth and states and territories. At this time there was broad consensus between these governments that more competitive markets would benefit Australia and its citizens.

However, over the last three decades initiatives to deliver competition and contestability to public services, namely through privatisation, outsourcing and deregulation, have repeatedly failed both economically and socially.

This submission, using a framework built on neoclassical economic principles, demonstrates how each failed attempt to add ‘competition’ and ‘contestability’ to a traditionally public service could have been predicted and avoided.

The post Privatised Failure appeared first on The Australia Institute.

In light of reports that the Victorian Government is considering privatising the Registry of Births, Deaths and Marriages, the Australia Institute – in a submission to the Productivity Commission’s National Competition Policy Analysis inquiry – recommends an urgent review of outsourced critical services such as electricity, aged, disability and childcare.

Key Findings:

• Despite the establishment of the Productivity Commission and National Competition Policy in the 1990s, growth of GDP per hour worked has declined over the past three decades.
• Neoliberal economic theory does not support the general conclusion that private ownership delivers lower costs, higher quality, or greater productivity than the public sector.
• The report advocates for a comprehensive inquiry into the performance of privatised and outsourced public services.
• This will likely involve bringing many services back into public control.

“The privatisation and outsourcing experiment of the past three decades has clearly failed,” said Richard Denniss, Executive Director of the Australia Institute.

“This failure is obvious to any Australian family paying for critical services like electricity, disability care, aged care or childcare.

However, it barely keeps up with inflation and fails to repair the loss in real purchasing power experienced by most Award-covered workers in recent years.

The price of necessities such as housing, energy and food have increased faster than average inflation, causing real incomes for low-wage workers – who spend more of their income on those essentials – to fall further.

Research from the Centre for Future Work shows the real value of most Award wages has lagged behind inflation since 2021 – losing about 4% of purchasing power in that time. It also found an increase of between 5% and 10% was required to keep up with current inflation and undo that past damage.

“Today’s decision, in light of current inflation forecasts, means real wages for Award-covered workers will not change much in the year ahead,” said Dr Fiona MacDonald Policy Director, Industrial and Social at the Centre for Future Work.

“It locks in the recent decline in living standards for Award-covered workers, making it harder for them to manage the challenges of housing prices, insecure work and a weakening economy.

“While the painful reality of lower real wages was acknowledged by the Fair Work Commission in announcing its wage award, its decision does not begin to repair this problem.

The ongoing incarceration of Julian Assange is a case of “punishment-by-process”, said his long-term legal advisor, Jennifer Robinson.

The United Kingdom High Court’s decision to an allow an appeal against his extradition to the United States is a welcome one, said Robinson. But 14 years after Wikileaks published confidential American military and government documents, Assange – the website’s founder – remains in legal limbo.

This uncertainty and the five years he’s now spent in London’s Belmarsh Prison are having a serious impact on Assange’s health, Robinson said on the latest episode of Follow the Money.

This ordeal is the result of a Trump administration decision to indict Assange for publishing material connected to the Afghanistan and Iraq wars, including the notorious Guantanamo Bay detention centre and the killing of journalists and civilians.

“We will be looking at the impact of this material for decades and generations to come.

“And yet, the person responsible for making this available to the public – with hundreds of media partners around the world – is in prison.

“We’ll look back on this time and think ‘how on earth did it take so long? How could we have allowed an award-winning publisher to sit in a British prison?’.”

“The Australian public thinks the gas industry should be paying for the gas.”

“We can keep doing dumb things if we want to. But if this Government wants to have more money for schools, more money for hospitals…there is a simple tax reform opportunity here.”

– Executive Director Richard Denniss on ABC The Business

The post Majority of Offshore Gas Projects Paid ZERO Royalties | Video appeared first on The Australia Institute.

An hour or so before Trump was due to take the stage at the Libertarian National Convention last Saturday evening, National Chair Angela McArdle appeared at the lectern. McArdle drily observed that the crowd, full of MAGA cap-wearing Trump supporters, was occupying seats clearly reserved for Libertarian Party delegates. McArdle asked them to move, even going so far as to warn them not to make her come down there and “start a chair fight”.

The atmosphere was tense, and felt close to cracking, but McArdle deftly held things together. The Trump supporters moved for the Libertarians, eventually.

Trump was, as McArdle pointed out, there to speak to them, not the adoring fans who had tried to pack out the event. The former president had accepted the invitation in an effort to convince libertarians to vote for him in November – the first time a former president has ever graced them with his presence.

But the libertarians are a skeptical bunch; it was never going to be an easy task.

McArdle was followed by favorite Libertarian comedian David Smith, who reminded the restless audience that “we are not a bunch of college leftist sissies. We believe in free speech, so be respectful…the message that we are sending to the world is not that we can’t handle ideas we disagree with.”

Gas companies are meant to pay royalties for the right to extract and sell Australian gas. But no royalties are paid on 56% of gas exported from Australia. Report author Mark Ogge joined ABC News to discuss.

A new report from the Australia Institute, Australia’s Great Gas Giveaway, shows that over the last four years, multinational companies made $149 billion exporting royalty-free gas.

Australians have missed out on at least $13.3 billion in revenue that could have been raised over the last four years had royalties been charged on royalty-free gas.

The post “Extraordinary” No royalties paid on 56% of gas exported from Australia | Video appeared first on The Australia Institute.

With interest rates refusing to fall below three per cent, some analysts are making dire assessments of the Australia economy. But while so-called ‘sticky’ inflation isn’t great, it’s better than risking a huge drop in demand and a deep recession, according to Greg Jericho. On this episode, Greg examines why inflation is refusing to budge and what policymakers can do about it.

Greg Jericho is Chief Economist at the Australia Institute and the Centre for Future Work and popular columnist of Grogonomics with Guardian Australia. Each week on Dollars & Sense, Greg dives into the latest economic figures to explain what they can tell us about what’s happening in the economy, how it will impact you and where things are headed.

Host: Greg Jericho, Chief Economist, the Australia Institute and Centre for Future Work // @GrogsGamut

Producer: Jennifer Macey // @jennifermacey

Theme music: Blue Dot Sessions

Australia Institute research has found that 56% of gas exported from Australia attracts zero royalty payments, effectively giving a public resource to multinational gas corporations for free.

Around 80% of Australia’s gas is exported as liquefied natural gas (LNG). Most of this gas is extracted from gas fields in Commonwealth waters, but the Australian Government has failed to levy royalties on gas feeding six of the seven offshore gas LNG export terminals operating in Western Australia and the Northern Territory.

Overall, this means over half the gas exported from Australia is royalty free.

Press conference at Parliament House featuring:

• Senator David Pocock – Independent for the ACT
• Dr Monique Ryan MP – Independent Member for Kooyong
• Dr Richard Denniss – Executive Director, the Australia Institute
• Mark Ogge – Principal Advisor, the Australia Institute

Recorded 11:30am, Thursday 30th May

It’s been 12 years since Julian Assange has been free – but is the fight to keep him from a life in an American prison finally coming to an end?

United States President Joe Biden told reporters he’s considering Australia’s request to drop charges against Assange for publishing thousands of sensitive military and government documents, but the fight to free the Australian whistleblower isn’t over.

This episode was recorded on Tuesday 21st May 2024 and things may have changed since recording.

australiainstitute.org.au // @theausinstitute

Guest: Jennifer Robinson, international human rights lawyer and legal advisor to Julian Assange // @suigenerisjen

Host: Ebony Bennett, Deputy Director, the Australia Institute // @ebony_bennett

Producer: Jennifer Macey // @jennifermacey

Additional editing: Emily Perkins

Theme music: Pulse and Thrum; additional music by Blue Dot Sessions

Around 80% of Australia’s gas is exported as liquefied natural gas (LNG). Most of this gas is extracted from gas fields in Commonwealth waters, but the Australian Government has failed to levy royalties on gas feeding six of the seven offshore gas LNG export terminals operating in Western Australia and the Northern Territory. Overall, this means over half the gas exported from Australia is royalty free.

Key Findings:

• No royalties are paid on 56% of the gas that is exported from Australia, including 73% of gas exported from WA.
• Over the last four years, multinational companies made $149 billion exporting royalty free gas.
• At least $13.3 billion in revenue could have been raised over the last four years had royalties been charged on royalty-free gas.
• No royalties are paid on gas supplying major facilities owned by Chevron, Woodside (Pluto), Shell, Inpex and Santos
• Royalties are only paid by the heavily subsidised North West Shelf and onshore fields.

“Many Australians will be shocked to realise that a large portion of the nation’s gas is given away, essentially for free,” said Mark Ogge, Principal Advisor at the Australia Institute.

“In the words of WA Treasury, ‘a royalty is the purchase price for a community-owned resource,’ and ‘the community expects a fair return for its petroleum resources’.

“However, in many cases Australians are getting no return at all for the sale of their gas.

In view of this, many Australians might be surprised to learn that a large amount of the country’s gas reserves are essentially being given away for free.

Australia has ten facilities that export gas as liquified natural gas (LNG). Six of these projects—four of the five operating in Western Australia, along with both of the Northern Territory’s facilities—pay no royalties, either state or federal. These facilities represent 56% of Australia’s gas export capacity. This means that more than half the gas exported from Australia is given for free to the companies exporting it.

The monetary value of this gas is enormous. The total value of LNG exports over the last four years is estimated at $265 billion. Exports of LNG based on royalty-free gas were valued at a total of $149 billion. To put this another way: in the last four years alone, Australians have given away the gas that made $149 billion worth of LNG, for free. $111 billion worth of this royalty-free LNG was produced in Western Australia.

The billions of dollars in forgone revenue each year from effectively giving away Australian gas for free could be invested in a sovereign wealth fund (as it is in Norway) or used to raise productivity and increase living standards of Australians by funding schools, hospitals, renewable energy, and other needed public infrastructure.

The gas industry does not make a fair contribution to the community. The Australia Institute recommends:

When US President Joe Biden said that this year, “democracy is on the ballot”, he was more on the money than he possibly knew. But while we could be forgiven for thinking 2024 will be all about American democracy, this year is in fact a big one for democracies across the world. Depending on how you do the maths, somewhere between two and four billion people will head to the polls.

So according to Vox, 2024 will be “the biggest election year in history”; according to Time Magazine, it’s “a make-or-break year for democracy worldwide”; and according to the Economist, it will be “a nerve-wracking and dangerous year.” You get the picture!

From Algeria to Venezuela, democratic and not-so democratic countries are holding elections. Many of them will have critical implications for Australia, our allies, and our region.

It is a dismal document. Defence argot and clunky phrases present what is little more than portentous persiflage – where it is not just self-serving.

The breathless opening ­sentence tells us that there is no greater responsibility for the government than defending Australia.

But what does that mean?

The second sentence explains it: the government is committed to “deploying all elements of national power” to protect our security, interests and way of life.

Nowhere are any of these concepts explained. What is national power? How much of it does Australia have? How does Australia use it? Is it just armed force? What is security? What are our interests? What is our way of life? Did anyone ask the First Peoples? What about climate?

The document ends with the same sort of logorrhoea. It announces a biennial NDS cycle that “provides a structured basis to regularly evaluate and prioritise efforts to maintain a more lethal ADF that is capable of credibly holding potential adversaries at risk – including as military forces modernise and strategic challenges continue to evolve”.

So there you are: everything’s quite clear! And we know where the next iteration of Australia’s defence strategy might take us. The US now talks about “integrated deterrence” (whatever that means). It is just a matter of time before the Australian echo sounds. We are already on the way to an “Objective Integrated Force”, whatever that might be.

Every year, over 300,000 tonnes of clothing is either sent to landfill or exported from Australia.

To respond to the growing textiles waste problem, the Commonwealth has proposed policies intended to create a ‘circular economy.’

However, a genuinely circular economy depends on drastically reducing the rate at which textiles are produced and consumed, banning the export of textiles waste, and investing in Australia’s capacity to manufacture and recycle better alternatives domestically.

This paper discusses how textiles waste is generated and discarded in Australia, and the policies needed to create a ‘circular economy’ for textiles. Australia’s addiction to cheap textiles, many of which are derived from fossil fuels, has global consequences. The rapid production and overconsumption of textiles – particularly ‘fast fashion’ – creates obstacles to the reuse and repair of textiles, and our inability to reuse or recycle them domestically means we continue to rely on exporting textiles waste to landfills, waterways and beaches far from Australian shores.

The post Textiles waste in Australia appeared first on The Australia Institute.

The analysis shows Australia has surpassed the US as the world’s biggest consumer of textiles per capita, much of which is fast fashion that ends up in landfill.

Key findings

The oil and gas industry loves to tell Australians that they pay a lot of tax, but the evidence says otherwise.

Not only has the Australian Taxation Office (ATO) described the oil and gas industry as home to “systemic non-payers” of tax, but new Australia Institute research shows that Australia’s teachers pay twice as much tax as the oil and gas industry.

Read that again if you have to. Teachers pay more in personal income tax than the entire oil and gas industry pays in company tax and Petroleum Resource Rent Tax (PRRT).

Over the last ten years, ATO data shows that all of Australia’s school teachers paid $95 billion in personal income tax, an average of $9.5 billion per year.

By contrast, the oil and gas industry paid $12.5 billion in PRRT and $33 billion in company tax over the last ten years, or an average of just $4.6 billion per year.

In May 2024, the Australia Institute once again surveyed a nationally representative sample of Australians about whether they support, for their own state or territory, each of those 10 policies.

The results show that most of these policies have widespread support across Australia.

The post Polling – Australian attitudes to ACT policies appeared first on The Australia Institute.

Indeed, its decision to spend $3.5b on an Energy Relief Fund is an innovative, and likely effective, policy response to current idiosyncratic and challenging economic circumstances.

Jim Chalmers’ use of new policy tools to solve new kinds of inflation has enraged many commentators, but the anger of those stuck in the past doesn’t mean we shouldn’t be looking to the future.

For many of the loudest voices in Australia’s economic debate, it is a truism that public spending causes inflation. Public funding is simply fuel for the inflationary fire that they fear more than anything, including recessions and climate change.

For these ‘inflation hawks’ the idea that increasing public spending could lower inflation is simply absurd. But just because powerful people believe something doesn’t make it right.

In Australia, the most common measure of inflation is the CPI.

The CPI represents an incredibly large ‘basket of goods’ that captures the price of pretty much everything a consumer might spend money on.

Of course, it includes the price of bread and milk and petrol. But it also includes the price of building a new house, private health insurance, private school fees and even HECS fees.

Obviously not everyone buys the same things each week and in turn the ABS tries to identify a ‘representative household’. Understandably, that’s not really possible, as most people spend zero dollars per year on private school fees while some spend $100,000 per year keeping their kids away from the masses.

The ACT goes to an election later this year. During the campaign, what bold policies will candidates and parties propose?

100% renewable energy by 2020 target

In 2019, the ACT became the first Australian state or territory to transition from fossil fuel to 100% renewable electricity, and just the eighth jurisdiction in the world to do so – and the first outside of Europe.

The ACT’s transition to 100% renewable has reduced emissions by 40%, secured $500 million in local investment and economic benefits and kept energy prices low as prices in the rest of the country soared. The ACT is now looking to build the Big Canberra Battery, to provide energy storage and help meet the ACT’s net zero emissions by 2045 target.

Earlier this month, the Australia Institute polled a nationally representative sample of Australians – and found 71% support a 100% renewable energy policy.

According to the Productivity Commission, wealth inequality declined during the COVID years due to boosted government support payments. And when those payments finished, predictably inequality went back up.

The overwhelming majority of gains from economic growth since the GFC have gone to the wealthiest people. On this episode, Greg Jericho discusses inequality, poverty, and government support.

Greg Jericho is Chief Economist at the Australia Institute and the Centre for Future Work and popular columnist of Grogonomics with Guardian Australia. Each week on Dollars & Sense, Greg dives into the latest economic figures to explain what they can tell us about what’s happening in the economy, how it will impact you and where things are headed.

australiainstitute.org.au // @theausinstitute

Host: Greg Jericho, Chief Economist, the Australia Institute and Centre for Future Work // @GrogsGamut

Producer: Jennifer Macey // @jennifermacey

Theme music: Blue Dot Sessions

The Wrap with Richard Denniss

Money can’t buy everything, but it may buy this government a reduction in inflation ahead of the next election.

As I wrote in the Nine papers this week, the government’s $3.5 billion Energy Bill Relief Fund is an innovative response to the unusual and challenging economic times we’re experiencing.

By reducing everybody’s energy bills by $300, they will lower the consumer price index (CPI) – and so are quite literally buying a reduction in inflation.

For 46 years, Meredith Stanton has lived on a small bush block at Clouds Creek, near Dorrigo in NSW.

It’s surrounded by forest, much of it within the planned Great Koala National Park: a vast nature sanctuary the NSW Government is promising to create.

In 2019, as terrible bushfires ravaged the region, flames licked the boundary of Ms Stanton’s property.

“All the forest 360 degrees around me burnt,” she recalls, “some of it severely, some of it slowly.”

Millions of creatures perished in the fires, including significant numbers of koalas and other endangered species such as the greater glider.



The Great Koala National Park, promised by the NSW Labor government over a decade ago, is meant to protect forests that are home to nearly one in five of the state’s wild koalas.

But the NSW government is yet to set a date for the park and is allowing native forest logging within the proposed park boundaries to continue ravaging critical habitat for the endangered greater glider and koala.

A video report presented by Stephen Long, Senior Fellow, and Contributing Editor at the Australia Institute on Gumbaynggirr land.

Featuring:

• Mark Graham, Ecologist
• Meredith Stanton, Environmentalist
• Uncle Micklo Jarrett, Gumbaynggirr man

Learn More

Read more from Stephen Long: “Smash and Grab”: Backwards Carbon Credits Logic Incentivises Native Forest Logging 

A series of recent high-profile incidents has thrust the national crisis of domestic violence into the spotlight. Clearly the current approach to violence against women isn’t working, so what can be done?

1800RESPECT is the national domestic, family and sexual violence counselling, information and support service. Call 1800 737 732, text 0458 737 732, chat online or video call via their website.

This episode was recorded on Tuesday 21st May 2024 and things may have changed since recording.

australiainstitute.org.au // @theausinstitute

Guest: Jess Hill, investigative journalist, educator on coercive control, and author of See What You Made Me Do. // @jessradio

Host: Ebony Bennett, Deputy Director, the Australia Institute // @ebony_bennett

Producer: Jennifer Macey // @jennifermacey

Additional editing: Emily Perkins

Theme music: Pulse and Thrum; additional music by Blue Dot Sessions

As a “snapshot”, the report is just presenting the current situation rather than offering solutions. But unfortunately, it also perpetuates the lie that inequality and poverty is beyond our ability to fix.

It took only two paragraphs for warning bells to start ringing in my ears. On the opening page, the commission notes “the initial period of the pandemic saw an unprecedented fall in income inequality”. This of course did not happen by accident but “as a result of the significant increase in support payments from the Australian Government”.

These increases “included the Coronavirus Supplement, which was paid to income support recipients, such as those receiving JobSeeker and Youth Allowance”.

The budget reveals what governments actually care about. And Labor has chosen to keep jobseekers in poverty
Greg Jericho

All good so far. The government increased payments $550 a fortnight and it caused “an unprecedented fall in income inequality”.

But then comes the kicker.

The Productivity Commission states with a misguided certainty that only comes from a lifetime of adherence to the God of small government and market forces that these payments were “not fiscally sustainable in the long term”.

Excuse me?

Not fiscally sustainable? Sorry, but that is just flat out wrong. And irresponsibly so.

“Reporting on a crime should not be a crime. Assange’s case is a political one – he continues to be punished for embarrassing the United States by drawing attention to possible war crimes by its military forces. Australia, in contrast, has acknowledged war crimes perpetrated by its soldiers,” said Dr Emma Shortis, Senior Researcher at the Australia Institute.

“Assange, an Australian citizen, is being pursued by Australia’s most trusted and important ally for publishing the truth. The US-Australia relationship is supposedly based on ‘shared values’ – that is evidently not the case.

“The fact that the US is continuing with this case despite direct appeals from the Australian Government should be understood as an appalling show of disrespect for a critical security ally.

“This is especially true as it is happening in the shadow of the AUKUS pact – a deal in which Australia will hand over $368 billion and likely a significant portion of our sovereignty.

“Assange’s case reflects the alliance as it stands today – anti-democratic, secretive, and militarised.

“The Australian Government has repeatedly made it clear that Assange should be allowed to return to Australia. It is crucial that this diplomacy continues loudly and unapologetically.”

The post Assange Verdict Sees Punishment-By-Process Continue appeared first on The Australia Institute.

This means by 2027-28 Western Australian motorists will pay 6 times more in vehicle registration than the gas industry pays in royalties.

Key Findings

• In 2022-23, royalties from WA’s gas exports were $1.5 billion and made up just 3.4 % of WA Government revenue
• In 2023-24, royalties are expected to drop to $647 million (just 1.4% of revenue), falling again to just $258 million (0.6%) by 2027-28.
• By contrast, the vehicle registration fees paid by WA motorists will exceed $1.3 billion in 2024-25; double the value of oil and gas royalties.
• In 2027-28 the $258 million in forecast oil and gas royalties will equate to:
  • Just 5% of forecast iron ore royalties ($5.7 billion).
  • 1/6 of forecast vehicle registration revenue ($1.6 billion).
  • Less than half the value of forecast lithium royalties ($623 million).
  • Half the value of forecast gold royalties ($526 million).

“The return to the WA community from oil and gas production is tiny, and set to shrink further,” said Mark Ogge, Principal Advisor at the Australia Institute.

“This is shocking given that WA is one of the biggest LNG exporters in the world and both state and federal governments are planning on expanding gas production.

“Vast amounts of gas are exported from WA, but this doesn’t benefit Western Australians. It’s multinational gas corporations that make enormous profits while paying little in return.

It is expected to halve again by 2028, reaching just 0.6% of revenue, meaning WA’s motorists will pay 6x more in vehicle registration than the oil and gas industry pays in royalties.

When considering WA’s tiny and shrinking revenues from oil and gas, it is important to remember that WA is an internationally significant gas producer. If it were a country, WA would be the world’s third largest exporter of liquefied natural gas (LNG), behind only the USA and Qatar. The multinational companies that export LNG from WA made revenue of $56.3 billion in 2022-23, more than WA Government revenue ($43.6 billion in that year).

Despite the volume of gas produced and the huge export revenue, WA Government figures show that the WA community sees very little in return.

The gas industry has ripped of Western Australians for too long. The WA and Australian governments have an opportunity to raise far more money from oil and gas production

The post Budget revenue from WA gas exports appeared first on The Australia Institute.