13 January 2010

Senior Liberals Divided Again on Economy

More division and confusion has emerged in the Coalition on economic policy, with its most senior leaders at loggerheads on means-testing of the private health insurance rebate and tax policy.

Opposition Leader Tony Abbott has clearly indicated the Coalition will oppose the Government's moves to means-test the private health insurance rebate, with this position confirmed yesterday by a spokesperson for Mr Abbott, according to a report in The Age today.

Shadow Health Minister Peter Dutton also clearly indicated the Coalition will oppose means-testing, saying yesterday: "We won't be voting in favour of the Government's changes. We'll oppose it again."

However Shadow Finance Minister Barnaby Joyce has split from his leadership colleagues, declaring: "we should have an open mind to the consideration of the rebate".

Senator Joyce said yesterday that: "If there is a net saving you would have to positively consider it."

Either Senator Joyce, Mr Abbott or Mr Dutton need to retract their comments so as to give the Australian people some clarity about the Coalition's position on this important issue.

The Government is seeking to means-test the private health insurance rebate because we don't believe low and middle-income Australians should be subsidising the health insurance of millionaires.

Mr Abbott's efforts to oppose means-testing are preventing a budget saving of almost $2 billion over four years, blowing a huge hole in his claims of fiscal responsibility.

Further divisions have also emerged among Senator Joyce and Shadow Treasurer Joe Hockey on tax policy.

Mr Hockey told The Australian online on 4 January that: "if there are to be business tax cuts, they must be aimed at small business and not at the big end of town."

However Senator Joyce yesterday contradicted Mr Hockey by calling for a cut to the corporate tax rate, saying there needed "to be a plan to reduce it slightly" to keep Australia internationally competitive.

It is this type of confusion and ill-discipline that has come to characterise the Coalition throughout the global financial crisis, starting with its monumental misjudgment in opposing the stimulus measures that kept Australia out of recession.

A party that cannot manage a coherent and consistent position on key economic issues is utterly incapable of managing Australia's economy in still difficult economic times.