06-25-2019, 06:14 PM
(This post was last modified: 06-25-2019, 06:34 PM by thorn bird.)
To follow on from the above post this comment made interesting reading from the Australian newspaper.
Cut red tape and keep investment in the black
DANIEL WILD
12:00AM JUNE 25, 2019 COMMENTS
Scott Morrison’s vision to cut red tape will allow more Australians to reach their potential and for the Australian economy to flourish.
In an address to the Chamber of Commerce & Industry of Western Australia yesterday, the Prime Minister highlighted the need to “bust regulatory congestion” to remove “obstacles to business investment”.
His announcement that Assistant Minister to the Prime Minister Ben Morton will lead a review of red tape is an excellent first step. This move, along with Josh Frydenberg’s commitment to driving productivity growth, is the beginning of an ambitious third-term agenda for the Coalition.
It is right for the government to focus on regulatory reform and cutting red tape.
Red tape is the biggest barrier to economic opportunity and prosperity in Australia. Research by the Institute of Public Affairs estimates red tape reduces economic output by $176 billion a year, the equivalent to 10 per cent of gross domestic product. This makes red tape Australia’s biggest industry.
The lesson from the US under President Donald Trump is that cutting red tape and lowering taxes lead to an economic boom, and not just in terms of profits to businesses.
Since Trump came to office in January 2017, the unemployment rate has dropped to 3.6 per cent; the lowest rate since 1967; unemployment for minorities reached its lowest levels ever recorded; the unemployment rate for women has fallen to 3.1 per cent, which is the lowest since 1953; 422,000 jobs have been added in the manufacturing sector; and private sector business investment has increased from 17 per cent to 18.1 per cent of GDP.
This has led to the US labour market gradually tightening, which has placed upward pressure on wages and put workers in a stronger bargaining position.
The centrepiece of the reduction of red tape in the US has been a one-in-two-out approach, where two regulations are eliminated for every one introduced. Last year, 12 regulations were repealed for each new regulation introduced, resulting in a $US23bn reduction to regulatory costs.
The result is that in Trump’s first full year as president in 2017, total pages of legislation passed dropped by 36 per cent.
This is the largest reduction since records began in 1936.
In Australia, red tape affects every sector of the economy, from multi-billion-dollar projects in the resources sector to small shops on the local high street. The Roy Hill iron ore mine in the Pilbara in Western Australia, for example, required 4967 licences, permits and conditions for the pre-construction phase alone; and a contravention order was recently issued by a local council in NSW to a small food shop whose bottle of hand soap in the bathroom was less than 50 per cent full.
These examples demonstrate why business investment in Australia is just 11.8 per cent of GDP, which is lower than during the business-hostile Whitlam years. Low rates of business investment truncate the nation’s capital stock, which reduces productivity growth, and holds down real wages growth in the private sector.
As well as dragging down productivity and wages, red tape is pushing up the cost of living.
IPA research last year found that consumer prices in sectors with heavy government intervention have risen far faster than sectors with minimal intervention.
Across 20 years from 1997 to 2017, the cost of housing increased by 330 per cent, childcare by 310 per cent and electricity by 215 per cent.
But cutting red tape is not just an economic issue. It is a profound moral issue: red tape is disempowering. It prevents Australians from starting their own business, winning a pay rise and following their dreams.
Every hour spent on complying with red tape is an hour less dedicated to business expansion, in the community or helping the kids with their homework.
It is inherently undignified for an entrepreneur, a farmer, a prospector or a small-business owner to seek the permission of bureaucrats to start or expand a business or take on a new project that will employ more people and create greater opportunities. The disposition of a risk-averse bureaucracy will always clash with the entrepreneurial flair of hardworking Australians who are willing to take a risk, often putting their family home on the line, for the betterment of our nation. What have bureaucrats and regulators ever risked for Australia?
The exciting policy agenda of the Morrison government to cut red tape, along with reforming industrial relations and cutting income taxes, will help reverse the decline of small business, boost investment and allow the Australian middle class to prosper.
Daniel Wild is director of research with the Institute of Public Affairs.
Daniel Wild
Contributor
QUOTE:
"It is right for the government to focus on regulatory reform and cutting red tape.
Red tape is the biggest barrier to economic opportunity and prosperity in Australia. Research by the Institute of Public Affairs estimates red tape reduces economic output by $176 billion a year, the equivalent to 10 per cent of gross domestic product. This makes red tape Australia’s biggest industry."
General Aviation in Australia, considering how small it is as an industry, compared say with the US, attracts a rather disproportionate amount of red tape. With a page count running to over thirty thousand pages of regulation, with tens of thousands more in the pipeline one must wonder just why a tiny industry needs that amount of bureaucratic largess to control it.
By comparison the USA regulations run to around one thousand pages total, New Zealand much the same.
The GA Industry in the USA is still small in comparison with the other power houses of the USA's industrial complex, but nevertheless contributes billions to their GDP.
There is ample evidence that red tape is strangling the the life blood from the GA industry in Australia, being so small, it is particularly sensitive to price pressures from compliance with over-enthusiastic over-regulation.
Australia's Regulator CAsA, regulates from a whole of Aviation perspective. That is it regulates the regular Public Transport sector as well as all the other aspects that make up the whole Aviation Industry. The RPT side is by far the biggest sector of the whole industry. They have a captive market, devoid of any real competition. The regulations apply to them all, so the playing field is level for them all. Economy of scale means compliance costs can be more easily absorbed, a few bucks on a ticket price don't signify to their customers, though we are seeing a certain amount of push back from some regional areas where ticket prices are almost double that a comparable ticket would cost in the US. There is also the fact that regional towns who used to receive air services no longer do. Providing such a services is just not cost effective given the huge costs of gaining an Air operators certificate to do so, along with the attendant massive costs of maintaining it, even before capital is expended on a suitable aircraft to do it in.
To be fair CAsA is following the ethos developed in Europe where EASA promulgated a one size fits all approach to regulation. The folly of this approach lead General Aviation businesses in Europe to almost disappear except for corporate, who promptly registered their aircraft in tax havens outside Europe and carried on as usual without oversight.
For EASA the penny finally dropped and they are frantically writing new regulations that are inclusive of General Aviation. CAsA unfortunately are slow to keep up, a new tranche of regulations under their "reform" banner will force the commercial side of GA into the untenable position of having to operate as an airline with all the attendant costs tacked on. This will be the end game for general aviation in Australia as it was in Europe.
In Australia aviation and its regulation is a bureaucrats wet dream.
They have an airline industry which largely, thanks to advances in technology is inherently safe and it can be left to regulate itself.
On the GA side, a diverse, fractious, scattered industry, financially fragile, with little ability to politically mobilise to oppose impositions placed upon it, nor garner much attention from lazy unsympathetic media, except on the rare occasions an aviation incident or accident can be sensationalised into terrifying headlines, which feeds the publics perspective, heavily promoted by the regulator, that aviation is inherently unsafe.
A politically imposed ethos that safety must be its only consideration, thus creating a never ending make work program of Regulatory Reform.
A highly technical industry which few outsiders understand and can therefore be easily bamboozled with bureaucratic spin.
The Myth of safety is a very powerful tool to frighten off any political interference or oversight.
CAsA has promoted this Myth as the reason it must promulgate rafts of regulation to control an industry which is inherently safe despite anything that they do. CASA promotes they must regulate to protect Australia's reputation as a world leader in Aviation safety, which is another Myth. Australia is in fact no safer than any other ICAO compliant nation, around the world from my experience CAsA is a bit of a joke.
There was absolutely NO need for CAsA to expend hundreds of millions of dollars of taxpayers money on its make work reform program. New Zealand reformed their aviation regulations by copying the best most balanced in the world the US FAR's. Their success has lead to a healthy, vibrant, growing and safe GA industry, their regulations considered so balanced and effective that virtually the whole pacific region has embraced them.It cost New Zealand less than five million dollars and a couple of years to produce them. Australia has spent almost thirty years and half a BILLION dollars to destroy a whole industry. WHY?
If Australia's regulations are so safe, who in the world has adopted them?
In truth CAsA's reform program has not and will not provide the nivana of safety that CAsA extolls.
Its a MYTH.
Cut red tape and keep investment in the black
DANIEL WILD
12:00AM JUNE 25, 2019 COMMENTS
Scott Morrison’s vision to cut red tape will allow more Australians to reach their potential and for the Australian economy to flourish.
In an address to the Chamber of Commerce & Industry of Western Australia yesterday, the Prime Minister highlighted the need to “bust regulatory congestion” to remove “obstacles to business investment”.
His announcement that Assistant Minister to the Prime Minister Ben Morton will lead a review of red tape is an excellent first step. This move, along with Josh Frydenberg’s commitment to driving productivity growth, is the beginning of an ambitious third-term agenda for the Coalition.
It is right for the government to focus on regulatory reform and cutting red tape.
Red tape is the biggest barrier to economic opportunity and prosperity in Australia. Research by the Institute of Public Affairs estimates red tape reduces economic output by $176 billion a year, the equivalent to 10 per cent of gross domestic product. This makes red tape Australia’s biggest industry.
The lesson from the US under President Donald Trump is that cutting red tape and lowering taxes lead to an economic boom, and not just in terms of profits to businesses.
Since Trump came to office in January 2017, the unemployment rate has dropped to 3.6 per cent; the lowest rate since 1967; unemployment for minorities reached its lowest levels ever recorded; the unemployment rate for women has fallen to 3.1 per cent, which is the lowest since 1953; 422,000 jobs have been added in the manufacturing sector; and private sector business investment has increased from 17 per cent to 18.1 per cent of GDP.
This has led to the US labour market gradually tightening, which has placed upward pressure on wages and put workers in a stronger bargaining position.
The centrepiece of the reduction of red tape in the US has been a one-in-two-out approach, where two regulations are eliminated for every one introduced. Last year, 12 regulations were repealed for each new regulation introduced, resulting in a $US23bn reduction to regulatory costs.
The result is that in Trump’s first full year as president in 2017, total pages of legislation passed dropped by 36 per cent.
This is the largest reduction since records began in 1936.
In Australia, red tape affects every sector of the economy, from multi-billion-dollar projects in the resources sector to small shops on the local high street. The Roy Hill iron ore mine in the Pilbara in Western Australia, for example, required 4967 licences, permits and conditions for the pre-construction phase alone; and a contravention order was recently issued by a local council in NSW to a small food shop whose bottle of hand soap in the bathroom was less than 50 per cent full.
These examples demonstrate why business investment in Australia is just 11.8 per cent of GDP, which is lower than during the business-hostile Whitlam years. Low rates of business investment truncate the nation’s capital stock, which reduces productivity growth, and holds down real wages growth in the private sector.
As well as dragging down productivity and wages, red tape is pushing up the cost of living.
IPA research last year found that consumer prices in sectors with heavy government intervention have risen far faster than sectors with minimal intervention.
Across 20 years from 1997 to 2017, the cost of housing increased by 330 per cent, childcare by 310 per cent and electricity by 215 per cent.
But cutting red tape is not just an economic issue. It is a profound moral issue: red tape is disempowering. It prevents Australians from starting their own business, winning a pay rise and following their dreams.
Every hour spent on complying with red tape is an hour less dedicated to business expansion, in the community or helping the kids with their homework.
It is inherently undignified for an entrepreneur, a farmer, a prospector or a small-business owner to seek the permission of bureaucrats to start or expand a business or take on a new project that will employ more people and create greater opportunities. The disposition of a risk-averse bureaucracy will always clash with the entrepreneurial flair of hardworking Australians who are willing to take a risk, often putting their family home on the line, for the betterment of our nation. What have bureaucrats and regulators ever risked for Australia?
The exciting policy agenda of the Morrison government to cut red tape, along with reforming industrial relations and cutting income taxes, will help reverse the decline of small business, boost investment and allow the Australian middle class to prosper.
Daniel Wild is director of research with the Institute of Public Affairs.
Daniel Wild
Contributor
QUOTE:
"It is right for the government to focus on regulatory reform and cutting red tape.
Red tape is the biggest barrier to economic opportunity and prosperity in Australia. Research by the Institute of Public Affairs estimates red tape reduces economic output by $176 billion a year, the equivalent to 10 per cent of gross domestic product. This makes red tape Australia’s biggest industry."
General Aviation in Australia, considering how small it is as an industry, compared say with the US, attracts a rather disproportionate amount of red tape. With a page count running to over thirty thousand pages of regulation, with tens of thousands more in the pipeline one must wonder just why a tiny industry needs that amount of bureaucratic largess to control it.
By comparison the USA regulations run to around one thousand pages total, New Zealand much the same.
The GA Industry in the USA is still small in comparison with the other power houses of the USA's industrial complex, but nevertheless contributes billions to their GDP.
There is ample evidence that red tape is strangling the the life blood from the GA industry in Australia, being so small, it is particularly sensitive to price pressures from compliance with over-enthusiastic over-regulation.
Australia's Regulator CAsA, regulates from a whole of Aviation perspective. That is it regulates the regular Public Transport sector as well as all the other aspects that make up the whole Aviation Industry. The RPT side is by far the biggest sector of the whole industry. They have a captive market, devoid of any real competition. The regulations apply to them all, so the playing field is level for them all. Economy of scale means compliance costs can be more easily absorbed, a few bucks on a ticket price don't signify to their customers, though we are seeing a certain amount of push back from some regional areas where ticket prices are almost double that a comparable ticket would cost in the US. There is also the fact that regional towns who used to receive air services no longer do. Providing such a services is just not cost effective given the huge costs of gaining an Air operators certificate to do so, along with the attendant massive costs of maintaining it, even before capital is expended on a suitable aircraft to do it in.
To be fair CAsA is following the ethos developed in Europe where EASA promulgated a one size fits all approach to regulation. The folly of this approach lead General Aviation businesses in Europe to almost disappear except for corporate, who promptly registered their aircraft in tax havens outside Europe and carried on as usual without oversight.
For EASA the penny finally dropped and they are frantically writing new regulations that are inclusive of General Aviation. CAsA unfortunately are slow to keep up, a new tranche of regulations under their "reform" banner will force the commercial side of GA into the untenable position of having to operate as an airline with all the attendant costs tacked on. This will be the end game for general aviation in Australia as it was in Europe.
In Australia aviation and its regulation is a bureaucrats wet dream.
They have an airline industry which largely, thanks to advances in technology is inherently safe and it can be left to regulate itself.
On the GA side, a diverse, fractious, scattered industry, financially fragile, with little ability to politically mobilise to oppose impositions placed upon it, nor garner much attention from lazy unsympathetic media, except on the rare occasions an aviation incident or accident can be sensationalised into terrifying headlines, which feeds the publics perspective, heavily promoted by the regulator, that aviation is inherently unsafe.
A politically imposed ethos that safety must be its only consideration, thus creating a never ending make work program of Regulatory Reform.
A highly technical industry which few outsiders understand and can therefore be easily bamboozled with bureaucratic spin.
The Myth of safety is a very powerful tool to frighten off any political interference or oversight.
CAsA has promoted this Myth as the reason it must promulgate rafts of regulation to control an industry which is inherently safe despite anything that they do. CASA promotes they must regulate to protect Australia's reputation as a world leader in Aviation safety, which is another Myth. Australia is in fact no safer than any other ICAO compliant nation, around the world from my experience CAsA is a bit of a joke.
There was absolutely NO need for CAsA to expend hundreds of millions of dollars of taxpayers money on its make work reform program. New Zealand reformed their aviation regulations by copying the best most balanced in the world the US FAR's. Their success has lead to a healthy, vibrant, growing and safe GA industry, their regulations considered so balanced and effective that virtually the whole pacific region has embraced them.It cost New Zealand less than five million dollars and a couple of years to produce them. Australia has spent almost thirty years and half a BILLION dollars to destroy a whole industry. WHY?
If Australia's regulations are so safe, who in the world has adopted them?
In truth CAsA's reform program has not and will not provide the nivana of safety that CAsA extolls.
Its a MYTH.