Opinion: Public service is Labor’s ultimate Ponzi scheme
Opinion: Public service is Labor’s ultimate Ponzi scheme

Public service is ultimate Ponzi scheme

It was former US Republican president Ronald Reagan who nailed it about public servants.

He said: "Public servants say, always with the best intentions, "What greater service we could render if only we had a little more money and a little more power. But the truth is that outside of its legitimate function, government does nothing as well or as economically as the private sector.''

Smart guy Reagan. In Queensland, though, they've got the double whammy. More money, more power. The bloated, corpulent bureaucracy is soaring to new levels under Treasurer Cameron Dick, the man who would be premier, if only he was in the Left faction. Dick is borrowing record levels of money - it's called debt - to cover day-to-day expenses, instead of pumping it into infrastructure.

 

Treasurer Cameron Dick should be borrowing money to pay for infrastructure, not public servant wages. Picture: NCA NewsWire/Dan Peled
Treasurer Cameron Dick should be borrowing money to pay for infrastructure, not public servant wages. Picture: NCA NewsWire/Dan Peled

 

It's an extra $28 billion. Rolls off the tongue quite easily. Economists call this "bad debt''. Reserve Bank Governor Phillip Lowe urged states and territories to borrow to fund infrastructure, but not to put on more public servants.

As former Commonwealth Treasury official, Joe Branigan, said last week:

"Perhaps the Treasurer misheard the advice from the RBA Governor. When the governor said "more bitumen'' the Treasurer heard "more bureaucrats''. And when the governor said "concrete and steel'' the Treasurer thought he said "tea rooms and coffee machines''.'

This fiscal ineptitude is reckless and unsustainable and the Labor Party knows it. But they have fooled the electorate three times on fiscal responsibility since 2015, so why not give it another shot? After all, they can just blame it on COVID-19 when it all goes pear shaped. Then when the LNP starts exposing the economic malaise, they can tell voters it would be worse under the Tories because that bad man Mr Crisafulli will do what he did in the Newman Government and "sack, cut and sell''.

Putting on extra civil servants is the ultimate Labor Ponzi scheme. They vote Labor, tick, the unions levy them with fees, tick, and then the unions use those fees to donate money to Labor headquarters so that they can be re-elected. Big tick.

Leading economist Dr Marcus Smith says up to March this year, there were 232,554 public servants on the books, up about 35,000 since 2015, or about 15.5 per cent. Let's put that into perspective. This government has increased the public service in the past five years by the same amount as the population of Gladstone - every man, woman and child. And now it's borrowing tens of billions of dollars to put on more.

 

Public servant numbers have increased by more than 15 per cent under Annastacia Palaszczuk’s Labor government. Picture: Annette Dew
Public servant numbers have increased by more than 15 per cent under Annastacia Palaszczuk’s Labor government. Picture: Annette Dew

 

When it took over in 2015, the Labor Government said it would not increase the public service beyond the percentage increase in population. Queensland's average population growth rate has been 1.1 per cent a year during that period. The public service has grown by 3.1 per cent per year in that period. The budget numbers show that employee expenses are anticipated to climb by $3.3 billion or 13 per cent over the four years to 2024.

That puts us on track for a debt of $129 billion by 2024. The "bad debt'' component of that $129 billion is $88 billion, or 68 per cent. These are borrowings to run the public service. There are no dams, schools, roads or hospitals in that figure.

Of course, the other problem for this government is the staggering drop in mining and gas royalties and land rents. Much of the rebound is predicated on a vaccine being rolled out early next year and the economy growing significantly. Big jumps in coal production are factored in, yet the government can't or won't approve the Acland Stage 3 mine.

"It's important to note that the Queensland economy has a very different industry composition than NSW and Victoria,'' said Dr Smith.

"The Queensland Government is banking heavily on a rebound to the economy in 2021-22, including a substantial increase in GST receipts of $1.1 billion.''

It's hard to get economists to agree on anything, but they all say last week's budget places Queensland's precarious AA credit rating under renewed scrutiny by ratings agencies. A further downgrade would mean a higher interest bill for Queensland taxpayers. The government's likely response?

We'll just borrow more. After all, when it comes to voters, debt is not a dirty four letter word anymore.

TROUBLE IN PARADISE

Ular readers will recall a yarn from a few weeks back where it was revealed that the Chinese head lessee of Keswick Island was making life extremely difficult for the 50 or so local families who reside on the Great Barrier Reef island.

 

The State Government is refusing to step in over the dispute between the Chinese lessee of Keswick Island and local residents.
The State Government is refusing to step in over the dispute between the Chinese lessee of Keswick Island and local residents.

 

There are several other islands in that vicinity, including Lizard Island, which is controlled by Chinese interests. In the wake of the ongoing row with China, we pose this question - if Australian-owned interests controlled a few islands in the South China Sea, would the Communist China government be having a look at those lessee contracts? My belief is absolutely, but of course the Chinese would never allow a foreign entity to risk its sovereignty by acquiring control of an island. The Queensland Government's official response is it's a matter between China Bloom Pty Ltd and the locals, despite the government retaining ownership.

LEGEND DUMPED

ABC broadcasting doyenKerry Lonergan has been shafted after 35 years with the national broadcaster. He was the face of Landline and it now looks like that show is on its last legs. Remember when the ABC cared about the bush?

DUEL WITH TYSON

Mark "Chopper'' Burgess, 60, could fight Mike Tyson, 54, in Brisbane next year if local heavy hitters get their way.

Burgess said he was keen. "I'd knock him out … pure and simple,'' Burgess said.

Tyson foughtRoy Jones Jnrin an exhibition bout, which the judges gave as a draw. Most experts thought Tyson won the bout easily.

 

Mark 'Chopper' Burgess.
Mark 'Chopper' Burgess.

 

SPIN AND HUBRIS

Queensland Labor's boast about its performance in the Groom by-election was typical spin and hubris. They claimed an 8.4 per cent primary swing to Labor, but the Greens didn't run. Guess what the Greens got last time? Yep, 8.4 per cent.

'BONK' BAN

Will Premier Annastacia Palaszczuk follow the LNP's lead and introduce a "bonk'' ban among MPs, staff and the bureaucracy? Might cause some nervousness, right across the board.

MP IN HOT WATER

A Labor state MP in trouble with the tax office for not paying child support. Watch this space.

BID A SIDESHOW

China's bid for the 2032 Olympics is a sideshow. Having had the summer Olympics in 2008 and the Winter Olympics in 2022, the International Olympic Committee will not grant China the 2032 Olympics.

It's still very much Queensland's to lose. Remember, the corruption and vote-stacking has been consigned to the past under new IOC president Thomas Bach.

GOLF FACILITY

Royal Queensland golf club members are considering whether to turn a large portion of their land holdings into a Top Golf enterprise.

The facility would be built on the vacant land underneath the Gateway Bridge. The project involves borrowing significant funds, which makes some members nervous. If the Top Golf project is hit out of bounds, it will likely be turned into another nine holes.

SUCCESSFUL REIN

The Albion Park Harness Racing Club is going from strength to strength under the leadership of new CEO Scott Steele. The summer racing series is proving a big success.

 

 

 

Originally published as Public service is ultimate Ponzi scheme


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