Our fearless leader

Whilst the Rudd government continues to proclaim the success of their stimulus package the reality is not so pretty;

Official figures show business spending on buildings and equipment fell by almost 9 per cent in the March quarter to $23 billion.

That is worse than the 6 per cent fall economists had been expecting.

The outcome has heightened expectations that next week's GDP data will show that the economy has now gone backwards for two consecutive quarters, which is the technical definition of a recession.

The Australian dollar fell slightly just after the news.

A 50% anomaly indicates a dismal failure of Treasury modeling particularly after Secretary Ken Henry had recently defended the Rudd Government's robust growth projections included in the 2009 budget.

..Mr Henry was responding to critics who dismissed as "heroic'' the government's budget projections showing the Australian economy, after shrinking 0.5 per cent in 2009-10, would jump to 4.5 per cent in 2011-12 and 2012-13.

..This budget is telling a big story,'' he said today during a speech on the 2009/10 federal budget, which was released a week ago.

Unfortunately the story tellers don't believe that cutting payroll taxes is in the best interest of their constituents, the taxpayer

An analysis of the Tasmanian Chamber of Commerce and Industry study suggests a federal takeover and suspension of payroll tax would be a cheaper, quicker and more efficient method of saving jobs than components of the Rudd stimulus packages.

"The two stimulus packages worth a combined $52 billion will save 200,000 jobs, leading to an average cost of $260,000 for each job saved," TCCI chief economist Richard Dowling told The Australian. "The total cost of payroll tax nationally is $14 billion. Based on our data, the payroll tax stimulus would cost $150,000 per job saved."

..."An extrapolation of this sample indicates that a temporary suspension of payroll tax in Tasmania would save 1393 (vulnerable) jobs," the study concludes

The ALP Government in Tasmania has again found itself on the back foot with Treasury leaking documents like the proverbial sieve

The document indicates departmental fees and recoveries such as driver licences, land title and vehicle registration charges, will almost double next financial year.

The Premier, David Bartlett, has told Parliament he stands by previous statements that there will not be any new taxes, other than increases in line with inflation.

He is also defended a potential increase in funding for his own agency.

"The Department of Premier and Cabinet is in fact the conductor of the orchestra of the public sector," he said.

Over to you, maestro

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