Showing posts with label rorts. Show all posts
Showing posts with label rorts. Show all posts

Thursday, 22 March 2018

The tweet Malcolm Bligh Turnbull thought it was wise to delete from Twitter

On 22 March 2018 Australian Prime Minister Malcolm Bligh Turnbull deleted this tweet.

The video this tweet contained survives for a limited time elsewhere.

The reason why this tweet came and went so swiftly? Because many of the people with speaking parts are not low-income aged pensioners who just happen to have shares.

They are former business owners who are now self-funded retirees and, a least one of them structured his superannuation now in the pension phase on the premise that he would be receiving a taxpayer-funded cashback payment for unused franking credits - that is cash handouts for tax he never paid - for forever and a day.

One suspects that Turnbull suddenly realised that the video was not the tearjerker he originally thought it was.

Thursday, 15 March 2018

Let's talk about excess franking credits and why they have been money for jam for the last 17 years

This is what the Australian Taxation Office (ATO) states about imputation:

Dividends paid to shareholders by Australian resident companies are taxed under a system known as imputation. This is where the tax the company pays is imputed, or attributed, to the shareholders. The tax paid by the company is allocated to shareholders as franking credits attached to the dividends they receive.

Dividends and franking credits

If you receive franking credits on your dividends, you need to let us know your:

* franked amount
* franking credit.
If you are an Australian resident, we will use this information to:
* reduce your tax liability from all forms of income (not just dividends) and from your taxable net capital gain
* refund any excess franking to you after any of your income tax and Medicare levy liabilities have been met.

You are eligible for a refund of excess franking credits if all of the following apply:

* You receive franked dividends, on or after 1 July 2000, either directly or through a trust or partnership.
* Your basic tax liability is less than your franking credits after taking into account any other tax offsets you are entitled to.
* You meet our anti-avoidance rules, which are designed to ensure everyone pays their fair share of tax.

If you have received a dividend that has Australian franking credits attached from a New Zealand franking company, you may be eligible to claim the Australian sourced franking credits.

The policy of giving cash back for unused franking credits was introduced in 2000 by then Howard Government treasurer Peter Costello and for the last 17 years it has been systematically rorted by superannuation funds, private corporations, trusts and individuals - to the point where Treasury pays out an est. $6 billion per annum under this scheme.

With one individual whopaid no income tax reportedly received millions claiming cash for unused franking credits and the average unused credits cash back payment for people in the top 1% of self-managed super funds being est. $83,000 a year.

In March 2018 Federal Labor announced a policy effective January 2019 which removes claims for franking credits - but only in those years that the prospective claimant has no income tax liability payable.

So ending taxpayer-subsidised money for jam for around est. 9 per cent of the population who were receiving cash refunds for tax they had never paid .

Turnbull, Morrison & Co then came out fighting – accusing Opposition Leader Bill Shorten of robbing low income self-funded retirees and aged pensioners.

At that point, somewhat predictably, embarrassment for the Turnbull Government began…..

What Treasurer and Liberal MP for Cook Scott Morrison considered low income retirees was elucidated.

The Australian, 14 March 2018:

A retired couple living in a $2m house, with $3.2m in super, are classified as ‘‘low income’’. They have no income tax liability. They could also have an investment property and still wouldn’t have a tax liability because of the bizarre “senior and pensioners’ tax offset”, which lifts their effective tax-free threshold to about $58,000.

Turnbull & Co were accused of telling political lies.

The Guardian, 14 March 2018:

You won’t have missed the foghorn blast from the Turnbull government and its media amplifiers that has accompanied Labor’s latest bold foray on tax policy.

Scott Morrison has declared Labor is stealing tax refunds from pensioners and low-income retirees, and Malcolm Turnbull says Bill Shorten “is going after the savings of your parents and their friends and their contemporaries”.

So how do these terrifying-sounding claims stack up?

Let’s bring in the respected economist Saul Eslake, who has no political dog in this race. Eslake is blunt. He says the government’s posturing is “misleading in the same way that most of what Scott Morrison said about Labor’s policy on negative gearing was misleading”.

To understand precisely what is misleading – the first thing to know is when we are talking about Australian retirees having low incomes, often what that means is people have low taxable incomes.

Income from superannuation funds is tax free once people turn 60. Eslake says the decision to make income from super tax free is “top of my list of the dumbest tax policy decisions of the last 25 years”.

It means people with substantial assets, and big super balances – millionaires in fact – are in a position to report low taxable income, and in fact structure their affairs to ensure they have low taxable income.

They were also quite rightly accused of knowing that dividend imputation à la Costello is an expensive rort.

The Sydney Morning Herald, 13 March 2018:

Treasury considered dividend imputation reform in the lead up to Treasurer Scott Morrison's last budget, creating a dossier entitled "Tax Policy - Dividend Imputation" more than a year before Labor announced it would target the tax refunds of more than one million Australians on Tuesday.

The confidential file itemised in a list required to be disclosed by departments as part of freedom of information requirements was opened by Treasury in the first-half of last year.

Fairfax Media understands Treasury has been examining withholding dividend cheques from non-taxpaying shareholders ahead of this year's May budget.
Investigating potential savings needed to fund budget initiatives such as personal income tax cuts is normal practice in the pre-budget period.

Mr Morrison said on Tuesday the "government has never entertained" changes to the way it gives cash back to shareholders in response to a policy he described as a "cruel blow for retirees and pensioners," but his predecessor Joe Hockey first asked how dividend imputation could be improved - not replaced - three years ago. 

A white discussion paper on tax reform commissioned by Mr Hockey and completed by Treasury in 2015 found "there are some revenue concerns with the refundability of imputation credits," indicating the department was receiving lower tax revenues than it expected. 

"It provides a greater incentive for shareholders of closely held companies to delay distributions until a time when individual owners are subject to a relatively low tax rate, to receive a refund of tax paid by the company." 

The list published by Treasury shows the department's work on dividend imputation policy continued after Mr Morrison became Treasurer in 2016…..

Labor, which has not released Parliamentary Budget Office costings of its policy, said it planned on cancelling an average cash refund of $5000 on share dividends from 8 per cent of taxpayers, including 200,000 voters who self-manage their own super funds and 1 per cent of full pensioners..….

Image found on Twitter

"Rethink: Better tax, better Australia" discussion paper information here and submissions here.

Tuesday, 13 March 2018

Only a handful of NSW landowners to face court over Murray-Darling Basin water theft allegations?

ABC News, 8 March 2018:

The NSW Government will prosecute several people over alleged water theft on the Barwon-Darling, eight months after Four Corners investigated the issue.

WaterNSW has named the people it is taking to the Land and Environment Court over alleged breaches of water management rules.

They are prominent irrigator Peter Harris and his wife Jane Harris, who own a major cotton farm near Brewarrina in the state's north-west and were named in the Four Corners story.

The couple have been accused of taking water when the flow conditions did not permit it, and breaching licence and approval conditions.

Three members of another prominent family are also facing charges: cotton grower Anthony Barlow from Mungindi near Moree and Frederick and Margaret Barlow.
The Barlows have been accused of pumping during an embargo and pumping while metering equipment was not working.

WaterNSW gave false figures: Ombudsman

WaterNSW announced the prosecutions an hour before the NSW Ombudsman released a scathing report saying the agency had given the Government incorrect figures on its enforcement actions.

The state's ombudsman, Michael Barnes, found WaterNSW gave incorrect figures when it provided statistics that showed there had been a significant increase in enforcements between July 2016 and November 2017.

"The information provided to us indicated that the updated statistical information from WaterNSW that we'd published was significantly incorrect," he said.

"There had, in fact, been no referrals for prosecutions and no penalty infringement notices issued in the relevant period."

Mr Barnes said he initiated a separate investigation after his office received complaints about the figures, and he found WaterNSW had inflated the statistics.
"As part of our investigation, we confirmed with Revenue NSW that no penalty infringement notices were issued by WaterNSW in the relevant period," he said.

The ombudsman said he raised the issue with WaterNSW, which has admitted to the mistake and apologised.

Mr Barnes also said he believed the error was unintentional.

The agency's CEO, David Harris, said staff have now manually reviewed all actions taken.

"Some of the detail WaterNSW provided was incorrect and, although it was revised, it is not acceptable and we are acting to ensure it does not happen again," he said……

Tuesday, 27 February 2018

The mess that Barnaby left

EDO NSW, on behalf of its client the Inland Rivers Network, has commenced civil enforcement proceedings in the NSW Land and Environment Court in relation to allegations of unlawful water pumping by a large-scale irrigator on the Barwon-Darling River.

The two water access licences at the centre of these allegations allow the licence holder to pump water from the Barwon-Darling River in accordance with specified licence conditions, as well as rules set out in the relevant ‘water sharing plan’. The conditions and rules specify – amongst other things – how much water can be legally pumped in a water accounting year (which is the same as the financial year) and at what times pumping is permissible (which depends on the volume of water flowing in the river at any given time). 

Our client alleges that the holder of these licences pumped water in contravention of some of these conditions and rules, thereby breaching relevant provisions of the Water Management Act 2000 (NSW) (WM Act). The allegations are based on licence data obtained by EDO NSW earlier in 2017 from Water NSW, a state-owned corporation charged with the responsibility of regulating compliance with the WM Act. 

Analysis of this data, along with the relevant rules and publicly available information on river heights, indicates that the licence holder may have pumped significantly more water than was permissible on one licence during the 2014-15 water year, and taken a significant amount of water under another licence during a period of low flow when pumping was not permitted in the 2015-16 water year. Despite being made aware of these allegations by EDO NSW on two occasions, in April and August 2017, and having had access to the data since at least July 2016, Water NSW has not provided any indication that it intends to take compliance action against the licence holder.

Both allegations concern the potentially unlawful pumping of significant volumes of water, which may have had serious impacts on environmental flows in the river and downstream water users. However, our client is particularly concerned by the alleged over-extraction in the 2014/15 water year, as this period was so dry that the Menindee Lakes – which are filled by flows from the Barwon-Darling River – fell to 4 percent of their total storage capacity. This in turn threatened Broken Hill’s water security and led the NSW Government to impose an embargo on water extractions during part of that year in order to improve flows down the Barwon-Darling into the Lakes and Lower Darling River. 

In these proceedings, the Inland Rivers Network is seeking, amongst other things, an injunction preventing the licence holder from continuing to breach the relevant licence conditions. In addition, and in order to make good any depletion of environmental flows caused by the alleged unlawful pumping, our client is also asking the Court to require the licence holder to return to the river system an equivalent volume of water to that alleged to have been unlawfully taken, or to restrain the licence holder from pumping such a volume from the river system, during the next period of low flows in the river system. Failure to comply with a court order constitutes contempt of court, which is a criminal offence. 

EDO NSW is grateful to barristers Tom Howard SC and Natasha Hammond for their assistance in this matter.

Brendan Dobbie, Senior Solicitor at EDO NSW, has carriage of this matter for IRN.

In 2008, then Senator Joyce criticised the Labor government’s purchase of water in the Warrego valley: that is going to have no effect whatsoever in solving the problems of the lower Murray-Darling, and especially the southern states.

Despite the now Deputy Prime Minister and Water Minister’s own fierce criticism of that purchase, he approved the $16,977,600 purchase of another 10.611 gigalitres of water in the Warrego valley in March 2017 at more than twice the price paid by the Labor government. Questions should be raised about what changed the Deputy Prime Minister’s mind and whether that purchase was value for money.

This purchase also has serious implications for the recent amendments to the Basin Plan that was disallowed by the Senate on 14 February 2018.

This purchase was not required to meet the water recovery target in the Warrego under the Murray-Darling Basin Plan. Instead, it was intended to count towards the water recovery target in the Border Rivers. This swap required an amendment to s6.05 of the Basin Plan, which was tabled in parliament and disallowed by the Senate. Yet, the Warrego purchase was not reflected in the Sustainable Diversion Limits (SDLs) put to Parliament as part of the amendments.

Murray-Darling Basin Authority (MDBA) is required to base its recommendations to change SDLs based on best available science, but the proposed amendments allowed MDBA and States to subsequently change the SDLs in a valley without any consideration of the science.

While MDBA was seeking public submissions on changes to valley SDLs, based on science; the Department of Agriculture and Water Resources (DAWR) was in negotiations to change those valley targets, not based on science.

Parliament was asked to pass an amendment to the Basin Plan with SDLs that would have been changed based on a deal agreed over a year earlier, if the amendment had passed.

Given that the new SDLs were known and agreed by governments, it is not apparent why the MDBA did not include the new SDLs in the amendment put to parliament.

Tuesday, 20 February 2018

So will the Turnbull Government come clean about ministers' VIP travel over the last eighteen months?

It would appear that Australian federal politicians have a long history of using RAAF VIP jets in an extravagant manner.

Take current Deputy Prime Minister and Nationals MP for New England  Barnaby Joyce as an example. 

News Mail, 28  December 2012:

One Coalition heavyweight, Queensland Senator Barnaby Joyce, racked up one of the highest percentages of ghost flights among non-government parliamentarians.
Senator Joyce’s travel bill totalled some $47,955 for 10 taxpayer-funded flights, primarily between Melbourne or Canberra and St George.
But he was only on board for three of those flights, with the remaining seven costing nearly twice as much as the flights he was on board for - racking up $31,395 worth of ghost flights.

BuzzFeed, 28 July 2017:

BuzzFeed News has confirmed the deputy prime minister billed taxpayers almost $9,000 for "special purpose" defence force charter flights on the same day he attended a rugby league game with his family……
On Mother's Day last year, the Royal Australian Air Force (RAAF) was charged with collecting Barnaby Joyce and Nationals deputy leader Fiona Nash from two regional NSW towns, and flying them to Canberra ahead of the first day of the federal election campaign…..

The RAAF's logs revealed that the first flight on May 8 [2016], from Canberra to Tamworth with no passengers, cost $3,348. The second shows Joyce was picked up in Tamworth and flown to Parkes for $2,930.

The Daily Telegraph, 13 August 2017:

In March that year [2016], the empty VIP plane flew from Canberra to Melbourne, at a cost of $4604, to collect Deputy Prime Minister Barnaby Joyce and fly him to Tamworth at a cost of $5441. The plane then returned to Canberra without any passengers, at a cost of $4185.

Herald Sun, 2 January 2018:
RAAF planes took nine trips [in last half 2016] without passengers between Tamworth and Canberra to provide chartered flights to Deputy Prime Minister Barnaby Joyce, with each flight costing more than $4000. 

The New Daily, 18 February 2018:

Barnaby Joyce charged the taxpayer to stay overnight in Melbourne after attending an AFL game last year [2017], before chartering a $6000 “special purpose” defence force flight back to Tamworth the following day…..
Parliamentary documents show Mr Joyce claimed $442 in travelling allowance on May 13 last year for an overnight stay in Melbourne, citing “official business” as Deputy Prime Minister.
The Nationals leader declared in his register of member’s interests that he was a guest for the City vs Country at the May 13 AFL night match between Geelong and Essendon at the MCG, with the gift including “hospitality in the form of food and drinks”.
The New Daily can also reveal Mr Joyce was then the sole passenger on a Royal Australian Air Force (RAAF) flight from Melbourne to Tamworth the following day, which was Mother’s Day.

Defence Department documents show the cost to the taxpayer for the charter flight was $6440.

So it is no wonder that questions are being asked at this particular time.

Australian Parliament Senate Hansard, 14 February 2018:

Senator Kitching to move on the next day of sitting:
That there be laid on the table, by 5 pm on 15 February 2018, by: (a) the Minister for Defence, details of any Special Purpose Flights taken by members of the executive in 2017, noting that no reports on the use of Special Purpose Flights since 3 July 2016 have been tabled.

Thursday, 25 January 2018

Preying on the vulnerable the Centrelink way

The Guardian, 17 January 2018:

Centrelink has given companies accused of exploitation and misconduct direct access to welfare recipients’ money through its automated debit system.

The companies were granted access to the Centrepay system, which allows Centrelink to deduct money from welfare payments to pay approved businesses early.

The system is designed to ensure rent and power bills are paid by giving government-approved real estate agents and electricity retailers the first bite of social security payments.

But the federal government has long faced criticism for opening up Centrepay to household appliance rental companies, which rent out white goods, mobile phones, laptops and furniture.

A 2015 report from the corporate regulator found the sector was targeting Centrelink recipients and charging exorbitant prices, often more than five times the retail price of the leased goods – the equivalent of a 248% interest rate.

An independent review of Centrepay in 2013 warned the government that lax oversight was giving unscrupulous operators access to the system, raising the risk of exploitation.

More than four years on, those risks appear to still be materialising.

Guardian Australia has found at least four appliance rental companies were granted approval to use Centrepay, despite previously being punished by the corporate regulator or placed on binding agreements to rectify potential legal breaches.

One of the businesses, Amazing Rentals, continued to hold Centrepay approval for more than two years after the Australian Securities and Investments Commission (Asic) raised concerns it had failed to comply with responsible lending obligations. Most of the customers of its Darwin store, including many Indigenous Australians, received government benefits as their only source of income.

The company was renting white goods to people who could not read the contracts and did not understand what they were signing up to.

The corporate regulator accepted an enforceable undertaking from the company in June 2015, which forced it to shut down the store for 12 months, refund customers,

“We had examples of consumers who were on disability pensions or Newstart allowance where they were literally running out of money at the end of the month because of the impact of the repayments that were being made for those consumer lease products,” Asic senior executive Michael Saadat told the ABC at the time.

Amazing Rentals was eventually stripped of Centrepay approval in September last year, about the same time it became embroiled in a massive data breach, which exposed 26,000 documents with the personal details of 4,000 people in the Northern Territory and Queensland.

Other companies still approved for Centrepay include franchise Rent the Roo, which was fined $27,500 by Asic for breaching responsible lending laws in 2013; and Mr Rental Australia, which was found to have imposed a potentially unlawful early termination fee, and was forced by the regulator to refund about 1,560 consumers more than $300,000 in total.

Centrepay approval is also still active for The Rental Guys, a company found to have failed to meet responsible lending obligations to customers mainly from regional Indigenous communities, and not verifying their ability to make the rental payments. The company also placed vulnerable customers on new contracts that imposed higher fees and removed the right to own goods once the rental period was finished.

Rent-to-buy companies approved for the Centrepay system sign contracts with customers knowing they are living on welfare payments.

Friday, 11 August 2017

Water rorting continues in the Murray-Darling Basin aided and abetted by the NSW Nationals

And local government and commercial interests in the Murray-Darling Basin have the hide to cry that they are water deprived and should be allowed to dam and divert water from the Clarence River catchment until that coastal system is a pale shadow of its vibrant self.

The Guardian, 4 August 2017:

The New South Wales regional water minister, Niall Blair, has quietly granted himself the power to approve illegal floodplain works retrospectively.

A Wentworth Group scientist, Jamie Pittock, has accused the NSW government of actively undermining the Murray-Darling basin plan as revelations have continued about the state government’s management of the river system.

Since Four Corners report raised allegations of water theft and secret meetings between a senior NSW water bureaucrat and a small number of irrigators,Blair is under increasing pressure over his water responsibilities.

This followed Daily Telegraph reports that the Nationals MP had been urging his Liberal colleague, the environment minister, Gabrielle Upton, to change the Barwon-Darling water-sharing plan retrospectively to favour large irrigators. He said the change was needed because of an error in the rules.

It has now come to light that Blair gazetted a Barwon-Darling valley floodplain management plan which gives him power to approve flood works built illegally even if they do not comply with requirements prior to the plan.

Under clause 39 of the new Barwon-Darling valley plan, a flood work that does not comply can be approved if “in the minister’s opinion” it is for an access road, a supply channel, a stock refuge or an infrastructure protection work
A spokesman for WaterNSW said three relevant applications from the Barwon-Darling region had been received since the change but none had yet been approved.

The NSW Greens MLC Jeremy Buckingham called on the NSW premier, Gladys Berejiklian, to remove the water portfolio from the National party after the regulation changes came to light.

“This is disgraceful example of the National party giving away free water to their big irrigator mates,” Buckingham said. “Many of these areas are so flat that even a 10 to 20cm bank can divert a huge amount of water into an irrigation dam and away from natural waterways.

“It’s a massive gift of water to the big irrigators. If we want to recover the water in the future then taxpayer will have to hand over huge amounts of compensation for what were illegal constructions.”

A spokeswoman for Blair said the gazettal was a “significant legacy issue” required to create a process where unapproved works could be properly and transparently assessed. She said to be considered, works must not have been previously refused and would still need to be assessed under certain criteria.

“Supply channels are one of the types of existing works that clause 39 indicates that we will accept application for,” the spokeswoman said. “Just because they are existing, doesn’t mean that they will be approved, just that they can apply. This approach is being rolled out through all floodplain management plans.”

Pittock, an associate professor in the Fenner school of environment and society at the Australian National University, said the revelations showed NSW was systematically white-anting the Murray Darling plan.

“The ‘rule error’ and other questionable dealings between wealthy irrigators, government officials and politicians in NSW highlight how the intent of the basin plan can be frustrated by those hostile to its implementation at the state level,” he told Guardian Australia.

“Changes of regulations in NSW have allowed irrigators to take erstwhile environmental flows by allowing greater pump capacity and earlier extraction based on river heights such that commonwealth-purchased environmental water in Queensland in not ‘shepherded’ through New South Wales to the lower Murray.

“Consequently towns like Broken Hill, pastoralists and Aboriginal communities, as well as the environment, have been starved of water.

Thursday, 2 March 2017

How major electricity suppliers take advantage of rural and regional customers

This is what NSW Dept of Industry, Resources and Energy advises owners of roof top solar power previously covered by pre 31 December 2016 feed-in tariffs:
It is up to individual customers to decide what metering arrangement will best suit their property, system and budget. You may wish to refer to the fact sheet Small Scale Solar PV Generators.
Generally if you do not receive a feed-in tariff, or if your feed-in tariff is lower than the price you pay for electricity, you are likely to be better off with a net meter. Under net metering, electricity from a solar PV system is first used to meet any consumption that takes place at the time of the generation. This means that for each kilowatt hour you consume of your own generation, you save the retail price that would otherwise be paid for that consumption.
Customers are encouraged to contact their distributor or accredited service provider to discuss their metering options before making a final decision.
Endeavour Energy customer contact number 131 003
Ausgrid call centre number 131 535
Essential Energy contact number 13 23 91

The writer of this letter to the editor, published in the Clarence Valley Independent on  22 February 2017, appears to be currently exporting all his solar power to a residential energy supplier for a pitiful return.

This is occurring because the power supplier (which based on stated costing is likely to be Origin/Essential Energy) is refusing to install a net meter function for the solar power system because of alleged deficiencies in mobile coverage.

Mobile cover is required as the digital net meter in question is to be read remotely and, apparently existing NBN satellite or fixed wireless cover in the Braunstone area is not considered satisfactory by the energy company's representative.

I'm sure there are more than a few Northern Rivers residents in the same situation as Mr. Philipse and, I rather suspect that residential energy suppliers are quite content to have it continue that way. As the est. $18 cents per kwh hour net profit earned from a customer's rooftop solar power output by charging top price of 24.2 cents per kwh for that same solar power as residential supply back to that customer, is money for jam for these companies.

Saturday, 9 April 2016

A topical tee shirt

Found on Twitter this week.....

This post is dedicated to Malcolm Bligh Turnbull's investment portfolio.

Wednesday, 22 January 2014

A Clarence valley voice in a wider forum

Clarence valley resident Charles Lincoln hold strong views on how the Abbott government regards pensioners. Mr Lincoln voiced his opinion in a contribution to the letters section of The Sun Herald (January 19).

Pension fears

 We have returned the Conservatives to power and as pensioners it appears that we may have done the wrong thing, as we now find that this government has openly stated that the pensioners are rorting the system with regards to concessional rebates on council rates (''Retirees furious over rate rort claim'', January 12).

This concession has not been raised with regards to the cost of living adjustments for seven decades.

So if this concessional rebate is a rort, in the eyes of the Federal Government, does it mean that all of the other pensioner concessions such as chemist prescriptions, doctor visits, transport and many more are also rorts?

Pensioners and all self-funded retirees must watch closely to make sure that the concessions that they have at present are not further eroded to improve the bottom line of the government, because increases in pensions are only 28 per cent of the average wage and each time that the CPI is increased we get further behind. 

Charles Lincoln, Gulmarrad