Small government philosophy? Then cut the waste


Taxes (Photo credit: LendingMemo)

If there is one thing that irritates me about governments it is their propensity to introduce additional administration for what seems like the sake of it. Perhaps due consideration is not given to streamlining an existing system, who knows. Certainly there is not much of a Lean approach taken in most cases.

Back in April 2012 I made the following observation about expensive government systems.

Then let us look at the wonderful Tax Benefits A and B.  Back in the day, if we had dependents, we claimed them on our tax.  If we had dependents, less tax was taken out of our pay each pay period.  A simple and relatively inexpensive system.  Now?  Heaven help me!  We have a whole Family Assistance Office managing a massive system where I ended up getting TWO (wouldn’t one have been enough) direct credits to my bank account each fortnight.  The whole process of even applying was a nightmare.

So scrap the whole damn system and go back to people simply claiming on their tax.  Far cheaper to the taxpayer.  We could even use the saved funds to provide some more tax relief for families, one would think.


I cannot tell you the number of letters I have received from this marvellous system. There are the stationery and postage costs, not to mention all the other associated costs. Who pays for all this? The taxpayer. Not only that, the taxes used to manage this system could SURELY be better used in other areas, like education and health! Reduce the subject levies at public schools, provide class sets of text books to reduce the costs of education for those living in poverty.

Then we have the round robin exchange of money for first home buyers. Pay transfer of land duty out of one hand and receive a first home owners grant with the other. Expensive financial exchange if all the costs are considered.

Today we have a new announcement of a proposal for bulk-billed patients visiting their general practitioner to pay a co-payment of $5 (some reports say $6). From what I understand so far, people with a health care card are exempt and families are granted twelve free visits a year. Is this per person or per family? What of single people, don’t they get any free visits? While I have major health related concerns over this proposal, this article is about wasting money.

My first reaction when I heard this was people will put off going to the general practitioner, potentially delaying diagnosis and early treatment, leading ultimately to higher costs of care later on. Seems like false economy on that basis alone. Men in particular are renown for waiting too long to go to the doctor, this may well exacerbate an existing health issue in this country. A sick parent, forced to decide between a loaf of bread to feed the kids or seeing about that cough will likely choose to feed the kids.

How much is this scheme, if it goes ahead, going to cost to run? Not only for the taxpayer but for the general practitioners. There will be reports to be made, returns to be submitted, who is tracking the twelve visits per year? The costs of compliance will be high, further pushing up the cost base of running a medical practice. That in turn will push up the doctors’ consultation fees.

What is the value add here to the end consumer (us) for their tax dollar? I don’t see one, but I’m open to considering proof such as an accurately costed proposal. I think it would show the costs might outweigh the revenue to be collected.

The current government has a philosophy of small government. Small government seems to mean, to them, limited interference in an individual’s life by way of “controlling” legislation, such as Section 18 C of the anti-discrimination legislation (pity protection is not such a high priority!). In my view “small” should also cover reducing the number of systems in place so we have a cost efficient public service. I am NOT suggesting a reduction in service provision, I am suggesting a rethink about how we do things. The cost savings might just allow the government to provide more and/or better services to the individuals in this country.

I am sure many readers will have their own experiences of what seem like ridiculous and COSTLY processes. For example I recently heard of someone having to repeatedly attend Centrelink to prove eligibility for a disability pension.  This sounds fine in principle, but for one small consideration. The person has a physical condition that will never change. NEVER. Not today, next week or next year. NEVER. How many dollars could be saved during that person’s life by marking the file “No reassessment required”, I wonder. No more interviews, no repeated medical assessments and reports to be submitted and reviewed. I am positive that person is not the only one in this situation.

Another interesting report I noted today was Bob Hawke calling for the abolition of states. This isn’t a new idea. I recall reading eons ago something about Australia being (at the time) one of the, if not the most, over governed country in the world per head of population. Can’t say I am overly keen on the idea of the winning party hand selecting people to sit in parliament as members of the ministry though. While the concept has the merit of being able to select a great scientist for the position of Minister of Science (which we currently don’t have), there is also the risk of “jobs for the boys”. That aside, what a wonderful way to streamline the cost of government!

Yes, I accept that the employees of the state system would lose the job they currently hold, but with all the work we could generate with the extra funds available they could be re-employed in hopefully much more rewarding jobs in, say, education and health! There would also need to be some increase in the federal public service. We might even be able to increase the New Start allowance to enable people to better equip themselves for job hunting.

I hope in the case of the co-payment commonsense prevails.

11 comments on “Small government philosophy? Then cut the waste

  1. […] – unemployment benefits and family assistance, aged pensions etc – absorbed into Human […]


  2. […] written before about the money carousels we have in Australia, all of which cost money, taxpayers’ money, to run. There is a big […]


  3. […] the #CashVows as Noely affectionately calls the $200 Marriage Counselling vouchers! There are lots of improvements that could be made BEFORE savaging the poor and vulnerable in […]


  4. […] looked at this question when the co-payment was first mooted. I thought it was ill-conceived then. It is still an […]


  5. […] Listen, love, I think we need to have a chat about the family budget. I know you are just learning the ropes with this money stuff and all, but you need to look at the basics. Basics always come first. I was actually rather impressed when you said the “age of entitlement” was over back in April 2012. I thought you were going to cut the frills, get back to basics and improve government efficiency. […]


  6. […] 1.7 million people in 2012 (Source: DSS Paper, Table 52). Robyn has written a great article “Small government philosophy? Then cut the waste” which looks more closely at the Family Tax issue. Thank you Robyn for the […]


  7. Who, if anyone, has proposed the $6 charge?

    It was a submission to the Commission of Audit. Not a Government proposal. Nobody in the media is saying who actually wrote the submission. Anyone can write a submission.


  8. Same as with most ideologically driven decisions – like if they did reduce the gst threshold for online sales. Cost more to collect than you get. Or axing/curtailing/getting tough on support payments – cost more in crime, health, & other areas.

    They don’t think these things through. Or worse still, they do, and the deleterious effects are part of their Machiavellian plan to achieve some ideological outcome.


    • Seems to me they all do it, both sides. Someone comes up with an idea, it gets approval, then implementated on top what ever other systems might be in place. No-one considers looking at what is already there and modifying/enhancing or even retiring somthing old and replacing. Just whack in some new, possibly bandaid, idea.

      All your examples are typical of the money ideas. Sad.


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