Australia keeps getting the sort of problems that other countries would pay good money to enjoy. Today’s it’s the discovery that, oops, we’ll actually have 6.5 million more people in the country in 2049 than the last time Treasury had an educated guess.
What would the Japanese, the Italians and the Russians give to have an expanding population! They’ve started shrinking, or soon will, and lack the sort of well-developed retirement savings policy that Australia acquired from Paul Keating.
Extra population, if we get our infrastructure and environmental settings right, is always good news. Those are big ifs, admittedly. We don’t charge properly for infrastructure usage; investment decisions are too politicised, and our politicians are incapable of agreeing on an effective greenhouse emissions trading scheme.
Wayne Swan’s (carefully-leaked) speech at the new and very specifically-titled “Australian Institute for Population Ageing Research” flagged the arrival ahead of schedule of the third Intergenerational Report, one of Peter Costello’s better initiatives. There’s some more good news in it. The population in mid-century will be bigger, but younger, courtesy of both immigration and a slightly higher domestic fertility rate. That’s not to say the demographic time bomb of an ageing population has been statistically defused. Rather, to labour the metaphor, the explosion will be slightly less powerful because there’ll be a higher proportion of the population under 65.
Further, with a modicum of policy gumption or, perhaps, the Prime Ministership of Tony Abbott, we’ll have increased the pension age to well over 70 by that time and ploughed billions more into superannuation by getting rid of commissions and other dodgy fees by financial planners.
I referred to the “ifs” of getting our infrastructure and environmental settings. Swan’s address emphasises getting fiscal settings right. Swan has flagged that there’ll be no new spending without offsets from existing spending. Sounds tough, but the Howard Government notionally had exactly the same policy as spending haemorrhaged to obscene levels in its final terms. It’s also the policy that was in place for the last Budget, when we were promised a bloodbath and ended up with a couple of paper cuts.
Nevertheless, the Government continues to shift its rhetoric toward that of fiscal responsibility, an approach that I appear to be alone in thinking will be the key to the Government’s election year strategy. The Henry Review and the looming superannuation inquiry will complicate matters, most likely serving up a number of reforms guaranteed to yield long-term benefits but short-term losers. Combined with a tough budget and without deft handling, the lead-up to the next election could be dominated by angry interest groups offended that they’ve been singled out to take a hit in the cause of a more efficient economy. “We’re taking the tough decisions” could quickly become “sh-t, we’re under fire from all directions”.
I can’t recall disagreeing with Bernard Keane before but on this issue I wonder where his understanding of ecologically sustainable development or ecological footprint has gone? People like Tim Flannery (and many others) have been pointing out for years, that if Australia wants the present lifestyle then this country could only do it by reducing its population to about 10- 12 million. If Bernard is so keen to endorse an increase in population (solely it seems for ecopnomic reasons) he has blundered in not considering the other two factors of society and the environment. Australia’s ecological footprint is what – 28 times above the average needed for a sustainable planet? It is the government’s refusal to even start a discussion on a Population Policy for Australia that allows erroneous descisions relating to the long term sustainabilty to go unchecked. At 65 I want to work longer, especially if it means delaying the pension and buiulding a better society for my children and grandchildren – after all, these people that I know personaly will be around to pick up the mess of an Australia with an increasing population rathre than a sustainable one.
True, but I agree with Keane that the Rudd Government is preparing to campaign for re election on being fiscally conservative, which is either ironic in view of its big stimulus or truer than they mean since they have just implented good ole Keynesianism. And, of course, the Libs are setting them up beautifully for it by making such a fuss of wasteful government spending. Labor has to include cuts to some middle class welfare either in a budget next year or in its election platform and the embarrassment of the Libs will be complete.
On this analysis I don’t see how it makes any difference whether the ‘fiscal conservative’ measures are included in a budget or an election platform. So I don’t see why the Coalition is convinced that Rudd is keen to go to an election before having to bring down the 2010 budget. This would matter only if you were Howard who sought to win elections with budget prolifigacy.
D J Hunwick’s got it right. We won’t reach that projected population, because the ecology will collapse long before that (cf Murray-Darling salinity and water shortage problems).
We don’t need more young people to support us in our old age, as long as we look after ourselves and keep our health as long as possible. I’m 70, and still working.
Like the previous Treasury guestimate, this piece of fluff is a valuable as anything else from experts without the slightest undertstanding of the real world. In general terms, 2049 is TWO generations hence – compare what you were doing/thinking/expecting then.
As if the remnant Boomers won’t be getting antsy enough in the next decade, their fecund offspring will be asking, “WTF were YOU thinking, if anything, for the last 20yrs to leave us this steaming pile…???”.
Without wanting to go all mad Mark Steyn, ” bigger, but younger, courtesy of both immigration and a slightly higher domestic fertility rate.” ignores the ethnic elephant in the stats.
Sorry, Hermitage strikes again – “..then” being 1969.