Invest
Is it time for a Rudd-style stimulus package?
A think tank has called for the government to unleash a Rudd-style fiscal stimulus, as withdrawing government support now could further damage the economy.
Is it time for a Rudd-style stimulus package?
A think tank has called for the government to unleash a Rudd-style fiscal stimulus, as withdrawing government support now could further damage the economy.
The Blueprint Institute wants the government to immediately distribute $1,000 to every adult in Australia who has an income of less than $100,000 for the 2019-20 financial year, plus $500 for each dependent.
Under the plan, another $750 would be distributed to the one in four Australians receiving government assistance, costing the treasury department $4 billion.
“These payments, targeted at lower-income households, would significantly stimulate aggregate demand,” Harry Guinness, CEO and co-founder of Blueprint Institute, said.
“The Treasurer’s announcement that the government may begin cutting spending or raising taxes once unemployment reaches 6 per cent is premature and has the potential to threaten the recovery. But we can and should be prudent with further stimulus, allocating resources to the areas most likely to boost activity, provide additional social benefits and minimise waste.”
The think tank also called for personal income tax cuts to be brought forward and the extension of the instant asset write-off scheme through to 30 June 2021, as well as strengthening “medium-term fiscal discipline” through tax reform.
“A ratcheting up of net debt over time would pose a risk to financing critical spending during a future crisis,” Blueprint said.
“Even if that risk is remote, its consequences would be so dire that we must take it seriously. Past prudence (alongside a good dose of luck) paid dividends in the last two crises – future discipline will be needed to confront the crises that lie ahead.”
To that end, the think tank also wants to formally separate economic forecasting from the political process, as is the case in the UK, in order to avoid the politicisation of debt and deficits that could “constrain the government during a crisis”.
“The government must re-establish a rigorous and independent Intergenerational Report,” the think tank said.
“The report was due to be released in June 2020, but has been delayed indefinitely. We cannot allow a short-term crisis to distract us from addressing longer-term structural challenges.”
About the author
About the author
Economy
5 ways the election could impact your US investments
With the Biden v Trump election just around the corner, investors in the US market need to watch out for a host of possible scenarios in the event of a changing government, an industry expert has flag...Read more
Economy
Lots of ammo, wrong target: Budget fails to hit its mark
The latest Treasury budget is the right size but is poorly targeted, with the focus on supply when a lack of demand is the real issue, according to an expert. ...Read more
Economy
Administrations rise as zombie firms accept reality
Business administrations have started to rise for the first time since June, with Victoria and Queensland recording the biggest spikes, new data from CreditorWatch has shown. ...Read more
Economy
Does the central bank favour the rich?
Current monetary policy strategies, including slashing cash rates and quantitative easing, are inflating asset prices and creating a greater inequality gap, an industry expert has said. ...Read more
Economy
Renewable energy, childcare subsidiary to kickstart the economy
Opposition Leader Anthony Albanese has promised childcare subsidies and an overhaul of the energy system as part of his plan to kickstart the economy. ...Read more
Economy
Rate cuts possible on Melbourne Cup Day: expert
The Reserve Bank of Australia could be looking to adjust official interest rates on Melbourne Cup Day for the first time in more than a decade, according to mortgage aggregator Finsure Group. ...Read more
Economy
Super fund CEO slams economic weaknesses
One of Australia’s biggest super funds has called the 2020 budget a “missed opportunity” to address the systemic weaknesses in the economy which have been exposed by COVID-19. ...Read more
Economy
Budget 2020 unveiled: The path out of the pandemic
Seven months overdue, the long-awaited federal budget has been delivered, setting out a much-anticipated plan for economic recovery post-COVID-19. Here’s what this might mean for you. ...Read more
Economy
5 ways the election could impact your US investments
With the Biden v Trump election just around the corner, investors in the US market need to watch out for a host of possible scenarios in the event of a changing government, an industry expert has flag...Read more
Economy
Lots of ammo, wrong target: Budget fails to hit its mark
The latest Treasury budget is the right size but is poorly targeted, with the focus on supply when a lack of demand is the real issue, according to an expert. ...Read more
Economy
Administrations rise as zombie firms accept reality
Business administrations have started to rise for the first time since June, with Victoria and Queensland recording the biggest spikes, new data from CreditorWatch has shown. ...Read more
Economy
Does the central bank favour the rich?
Current monetary policy strategies, including slashing cash rates and quantitative easing, are inflating asset prices and creating a greater inequality gap, an industry expert has said. ...Read more
Economy
Renewable energy, childcare subsidiary to kickstart the economy
Opposition Leader Anthony Albanese has promised childcare subsidies and an overhaul of the energy system as part of his plan to kickstart the economy. ...Read more
Economy
Rate cuts possible on Melbourne Cup Day: expert
The Reserve Bank of Australia could be looking to adjust official interest rates on Melbourne Cup Day for the first time in more than a decade, according to mortgage aggregator Finsure Group. ...Read more
Economy
Super fund CEO slams economic weaknesses
One of Australia’s biggest super funds has called the 2020 budget a “missed opportunity” to address the systemic weaknesses in the economy which have been exposed by COVID-19. ...Read more
Economy
Budget 2020 unveiled: The path out of the pandemic
Seven months overdue, the long-awaited federal budget has been delivered, setting out a much-anticipated plan for economic recovery post-COVID-19. Here’s what this might mean for you. ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.
