Tony Abbott is back this afternoon demanding more from the Government on funding the NDIS:
Opposition Leader Tony Abbott says the government needs to reveal how it will fund the entire national disability care scheme and not just half of it.
Prime Minister Julia Gillard today announced the Medicare levy would be lifted from 1.5 per cent to two per cent to raise around $3.2 billion towards the $8 billion a year scheme.
…”If I thought it was responsibly funded, yes (the coalition would vote for the laws),” he said.
…”I think there are other measures which are probably more obviously productivity measures, such as the paid parental leave scheme, but nevertheless over time a national disability insurance scheme will certainly help with productivity,” he said.
…The scheme would pay mothers taking six months leave up to $75,000.
It’s a more than fair question that Gillard should answer. But the line about a parental leave scheme being a productivity raising policy is questionable. How does an expensive new scheme that raises business costs in the name of sending workers on holiday for longer (albeit for good reason) increase productivity? I imagine there would be a lowering of staff turnover and hence a reduction in training costs (if that outweighed the cost of the scheme). And maybe parents would be happier and more productive upon their return. But it’s far from clear that the scheme is a productivity slam dunk as claimed which is probably why many in the LNP hate it.
Assuming the NDIS is a better way to manage disability care then it has a direct productivity payoff in lifting the participation rate of both the disabled and their carers. That has a flow on effect to greater labour availability and output.
I checked the Productivity Commission wish list of measures and an NDIS-like scheme is on it. So are Gonski-like reforms (as are a bunch of performance related teacher reforms that Labor has ignored).
There is no mention of generous parental leave schemes, though the PC head admits that a:
workplace regulations list has not been required to provide advice about this,so there is no formal list of recommendations from which I can confidently draw.
My guess is that that a parental leave scheme is a Catholic oriented reform about family integrity. A very good rationale but not the one being cited, nor one that allows us to assess whether or not we can afford it.
That is not to say that any of these policies are the most productivity enhancing available to the budget. The PC finishes:
So, where should today’s priorities lie? How can governments best advance Australia’s productivity performance by spending and regulating ‘better’?
For a start, spending more no longer represents the line of least resistance in promoting productivity. Indeed, the importance of making room for increased expenditure on key human service reforms, and notably disability support (PC 2011g), increases the need to spend less in other areas. The list under the ‘incentives’ heading provides several ‘win-win’ options (reforms that would lower budgetary outlays while lifting productivity).
In the regulatory area, the structural pressures of the ‘multi-speed’ economy have lent particular importance to the need to enhance flexibility and adaptability within enterprises and across industries and regions. This will remain the case as our economy changes gears again during the post-boom phase. It suggests that items on the ‘flexibility’ list should for the present generally take precedence over those on the ‘capability’ list, reversing recent emphasis.
The full wish list is provided below.
