Book Review: GAME OF MATES - How Favours Bleed The Nation by Cameron K. Murray and Paul Frijters

• James Beatson

This book provides the evidence that underlines a popular belief that corruption by our politicians is endemic. ABC News reports that in poll after poll popular satisfaction with our political system has plunged to unprecedented lows.

This clever, short, easy to read book by two Queensland University academics, Lecturer Cameron Murray and Professor Paul Frijters, provides a forensic study of corruption in Australian politics.

The chapter titles give it away: The Great Property Development Game; The Transportation Game; The Superannuation Game; The Mining Game, etc.

Symbolically the book commences with the first parcel of land granted by Governor Arthur Phillip to an Australian convict, James Ruse, in February 1790 as Ruse switched from being a convict to supporting the government.

The Transportation Game and The Great Property Development Game are emblematic of The Game.

The authors describe young future land developers, getting jobs in politics, business or the public service where they enjoy regular contact with senior politicians and industry leaders. Creating friendships that can create changes to zoning and planning rules, and to political campaign contributions.

While community members are able to give written and verbal inputs to public planning panels, such panels do occasionally oppose developments over environmental, traffic or other elements.

But there’s a twist! Developers can appeal such decisions through state’s Land and Environment Courts, and typically win, since only government development laws are considered.

Local government is not written into our Constitution where local councils are just State government sub-sets.

The authors explain The Transportation Game works on the principle that “To own roads and other infrastructure would be worth a lot more than they cost to build, preferably paid for by government as well".

How? “The myth in this sector, and in so many others, is that the government budget is like that of a household, and that ‘governments must live within their means’ by cutting back spending and no longer borrowing to pay for new road and rail construction. Their story is that government debt would have to be paid by future generations, and future generations should be free of such obligations.”

“The solution that accompanies this myth is to let the private sector fund costly infrastructure projects and in return give them ownership for many decades with the right to charge tolls. It was the political mantra of debt-free government coupled with community misinterpretations as to how government debt functions.”… “What if the developer could bind governments into contracts where the developer would pay almost nothing, but make it appear on the government books that the developer was paying for it, allowing politicians to brag that they were investing in large infrastructure projects without paying for it? If mates in government could keep to the story that they were doing the public a favour, they thought they could get away with it. And they did.”

“The basic strategy is to keep the costs of building infrastructure from appearing as public debt.”…” For example the New South Wales government granted a $223 million loan for the Sydney Harbour Tunnel that was never paid back."

The authors explains the one key ingredient are “grey gifts” given to project-aligned politicians, sub-contractors and bureaucrats, a process endemic in Australia.

The underlying reason? Running television and internet advertising campaigns in Federal and State elections costs millions. In the pre-electronic media-era of generations ago ‘pollies’ addressed large public meetings across our vast land, extensively covered by scores of regional daily newspapers and radio stations.

Today, unless you're playing the game of mates, or you’re Clive Palmer, it's just too expensive - a reason why small party’s important policies don’t receive significant media examination. Independents can do better, because actual knowledge of local candidates, can overcome big spending LNP and Labor campaigns.

The book can be borrowed at Gympie Library or bought on line. The book draws on many Queensland examples, with parallels federally and in all states.

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 Sizing Up Federal MPs Part 2 – Investment Properties and Skills

Another important aspect of Australian MPs income can also have an untoward influence of their decision-making. Investment properties: of course they are legal, but MPs have a relationship with these controversial assets.

Four years ago the Sydney Morning Herald published an exhaustive study into MPs’ investment properties (www.smh.com.au/politics/federal/houses-of-parliament-politicians-own-an-estimated-370m-of-property-20170420-gvp2g5.html). At the time, Australia's 227 federal politicians had hundreds of millions tied up in the property market.

I am including information from the SMH article, since I have only had one response to questions I put to 10 MPs with the largest numbers of investment properties. Most MPs don't like talking about their property portfolios. When the SMH sent out questions about MP’s property holdings, the Chief Government Whip sent all Coalition MPs an email instructing them not to respond.

At the time the SMH reported on “a conservative estimate based on the assumption that each of their 561 declared properties is worth the average Australian dwelling price of then $656,800”. The largest property portfolios are owned by Coalition MPs, accounting for 14 portfolios of the top 18MPs and nine of the top 10. Retired National, Senator Barry O'Sullivan, then owned 33 properties while current NSW Nationals MP, Dr David Gillespie, owns 18. Local MP, Llew O’Brien, reports he only owns one second home – his former Sydney family home.

The same article noted that in both absolute and proportionate terms, Coalition politicians largely oppose any crackdown on negative gearing and capital gains tax concessions. The Coalition's 105 MPs and their spouses own 315 of the declared properties - 56 per cent of the total number. Labor MPs declare 198 properties and minor party and independent MPs declare 48.

The SMH article noted “Then there are those properties we don't know about: concealed through companies, trusts and self-managed super funds. Or kept out of the public gaze through the clever use of parliamentary rules. So let's say the true figure of the total value is somewhere between $370 million and $500 million. Nearly two-thirds of MPs - 144 of them - own more than one property, a rate more than three times the national average. That's 64 per cent of MPs, compared to less than 20 per cent of Australians.”

So, while earning from different income streams, what skills do MPs bring to Parliament?

A vital practical skill would be the engineering - these decisions cost taxpayers from millions to billions of dollars. Currently there are only two federal MPs qualified as engineers, both women: the LNP’s Karen Andrews and the Green’s Mehreen Faruqi.

Mehreen Faruqi believes “Parliament is grossly unrepresentative of the wider community - with a lack of MPs with real-world experience and technical expertise. Sadly, parliament is stacked with career politicians who make decisions with no regard to evidence and which end up harming and costing all of us. They are decisions that suit only vested interests and bankrupt neo-liberal ideologies.”

And congratulations to local Federal MP, Llew O’Brien, who recently used the very old fashioned skill of integrity to gain a political win. Although previously the government resisted moves for a Royal Commission into Veteran Suicides, preferring to establish a permanent national commissioner for veteran suicides. But Tasmanian Independent Senator, Jackie Lambie, organised a Senate motion for a Royal Commission which passed in the Senate. Llew had notified Prime Minister Morrison “that I had formed a view and changed my position to support this motion” in the upcoming House of Representatives debate. And if the government didn't support this legislation in the Parliament he would cross the floor and vote with Labor and the Crossbenches. Later Llew met with the PM to discuss the upcoming vote, and shortly after, with Coalition support, the motion was passed unanimously.

Corrections: Last month article I reported our MP Lew O’Brien, receives an annual salary of $331,975, excluding super and unreported entitlements. When Llew become Deputy Speaker he forfeited chairing two Committee. This cut his salary by 2%. Like all MPs, he receives an Electorate Allowance of $32,000pa tax free, paid monthly. So his annual take home pay is now $317,975, excluding super and other unreported entitlements, or $6,105per week. Also, MPs previously could claim a first class round-the-world study tour. Plus they automatically benefited from an old superannuation retirement scheme. Both of these are closed to new members, and removed before Llew entered Parliament.  

James Beatson

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Sizing up Federal MPs Part 1 - Pay Packets

By Jim Beatson

Everyone is interested in the size of pay packets. What’s it like in federal government? Let’s start with the top end, Prime Minister Scott Morrison.

Morrison rates as the fifth highest paid head of a country on our planet. His gross pre-tax salary, is $549,250 per annum or $10,562 per week or $1,505 a day, excluding legal perks. The current global top of the tree is Lee Hsien Loong, Prime Minister of Singapore, on $AUD2,082,583 pa.

Salaries of our Prime Minister, Ministers and all federal members, are a complex mix made up of a base salary, plus loadings as a percentage of their base salary, perks not included.

All our Federal and State pollies are well paid. So I have chosen to look in detail at our local Federal Member for Wide Bay, Llew O’Brien, just because he is ours. Llew was elected at the 2016 Federal Election, and re-elected in May 2019. Before entering Parliament, Llew served as a police officer in the Wide Bay region for 16 years and specialised in criminal intelligence and traffic accident investigation.

As at 1 July 2020, the base salary of all our Federal MPs, like Llew, is $211,250 per annum. But Llew is the Deputy Speaker in the House of Reps, so he gets an additional 20% of his base salary (i.e, $42,250). And as Chair of both the House Petitions Committee and the Joint Select Committee on Road Safety he receives an additional 11% of base for each position (i.e. 2 X $23,237.5 = $46,475). And all MPs receive an annual electoral allowance of $32,000 for memberships of sporting clubs, community groups, essential public duties, etc.

So Mr O’Brien, annual take home pay is $331,975, excluding super and other unreported entitlements. That pre-tax is $6,384 per week.

Perks: Most MPs, who are not residents of Canberra, also receive $294 for each night they are required to stay overnight. In 2017, the last year reported in Parliamentary legislative papers, attendance was for 64 days with the sum paid per Federal Member being $18,816 pa. To save on costs, some Members share accommodation.

All MPs get the cost of up to two fixed telephone services (one of the two lines may be an internet service) plus installation, maintenance, rental, transfers, calls and data costs. If they have a second residence, they may elect one service to be reimbursed for their second residence.

After three years in office, MPs get the equivalent of an around-the-world first class airfare for overseas study tours as well as generous internal work-based flights

MPs get a private plated vehicle (luxury cars excluded), which operates like a salary sacrifice system: the government purchases and the user pays fees. Fuel/servicing costs are covered by taxpayers. MPs not choosing a plated car, receive an electorate allowance of $19,500 per annum for their own car.

When a member leaves politics, former MPs get three return trips to Canberra or the location of their former office per year, plus a complex travel allowance. Former members of Parliament who served more than three years of continuously, who wish to re-train for future employment, may receive six months of their base salary ($105,625).

As an MP Lew’s Super will be 2.3  times the contributions paid by him during his period of service or, if that period exceeds 8 years, during his last 8 years.

And income for the rest of us? According to Living-in-Australia.com “the national average wage is $89,122” pa. SalaryExplorer.com says the spread is from $23,000 pa (lowest average) to $405,000 pa (highest average, although actual maximum salary is higher)”. The Parliamentary web-site sets average Aussie wage at $65,540 with MPs salary 3.2 times greater. And that’s excluding all the perks listed above.

Note - Researching disclaimer:

It's not been easy researching these figures, as each figure appear comes from one of three categories of payments, each appearing in a different, almost incomprehensibly complex Parliamentary websites. Despite a multitude of phone calls to multiple Parliamentary staffers I only found one who could actually answer some of my questions in normal language. My best informant was a well-known Parliamentary journalist, who suggested that they were so flat out, all they could do was to just point you at one of the three websites.

REVEALED: Gifts, houses and assets held by Qld MPs

https://www.couriermail.com.au/subscribe/news/1/?sourceCode=CMWEB_WRE170_a&dest=https%3A%2F%2Fwww.couriermail.com.au%2Fnews%2Fqueensland%2Fqld-politics%2Faircraft-racehorse-footy-tickets-among-politicians-assets-gifts-on-latest-register-of-interests%2Fnews-story%2Ffe31819663f8ed30c73a454e677e00c1&memtype=anonymous&mode=premium&nk=f4529a5b842ca6ab2ea72d2402f6155f-1624346406

https://www.couriermail.com.au/news/queensland/qld-politics/politicians-perks-criticised-by-information-commissioner/news-story/5442a89d230df55ea74aea9ec736e11b

 

 

Since I moved to Kandanga in Dec 2020, 30 minutes from Gympie in Qld I have been writing a story for each month's Gympie Living. 

Here is my first story starting in March 2021:

Book Review: The Carbon Club by Marian Wilkinson, Allen & Unwin

HOW AUSTRALIA BECAME AN INTERNATIONAL PARIAH ON CLIMATE CHANGE. By Jim Beatson

Marian Wilkinson’s new book explains how huge oil and coal interests in the United States and Australia cooperated for over 20 years to prevent successive Australian Governments effective action on climate change. Today these interests hold majority control of the federal Liberal and National parties. How? By influencing in candidate pre-selection contests, funding and organising support for hard right candidates, including social media postings, all supported by Murdoch’s media commentators.

Investigative Journalist, Marian Wilkinson, is a giant of Australian journalism. She won two Walkley Awards for her work as reporter and producer of ABC's Four Corners program. Her meteoric rise started as reporter for community radio 4ZZZ, Brisbane, leading to New York and Washington correspondent for both ABC and Fairfax newspapers. In 2018, she was inducted into the Australia’s Media Hall of Fame.

The Carbon Club started years ago as a UK-funded TV documentary. Then Wilkinson was told by the film company, “Kevin Rudd's been elected…that's all dead now, you've got big climate action in Australia. Well, of course, you know, 13 years later, we're still waiting. And when I left Four Corners at the beginning of 2018, a lot of people were pressing me to write a book, and I was equally determined.”

The book works through the obvious villains: Abbott, Murdoch, Morrison, media shock jocks and social media. But Wilkinson introduces equally important but obscure players like Hugh Morgan, the principle owner of Western Mining, and Sen. Cory Bernardi.

“Hugh Morgan,’ Wilkinson writes “is a fascinating character, his real power came through the [dominant] Victorian state branch of the Liberal Party… and that power then emanated out from there [with Morgan] Chairman of its cash cow, the Cormack Foundation, … one of the most important funders of the Liberal party federally and of its Victorian and Western Australian divisions."

“[Morgan] would later say “ deep connections between the Australian and US climate-sceptic movements created the deluge of emails and calls had swung the vote [for Tony Abbott] against Turnbull...This was the first time in Australian political history that a political leader has been deposed by the rank and file of the party."

Wilkinson describes the rise Cory Bernardi. “He got his place in the Senate thanks to his mentor, Nick Minchin...he became a vocal defender of Australia's climate sceptics. Morgan's factotum was Ray Evans, still Australia's most influential campaigner against climate science...”

Impressed by Evans and Morgan’s apparent effectiveness, Bernardi left a position in Prime Minister Howard's office, moved to the US in 2008 and “met with a whole range of different organisations over there, the activist organisations in the tax space, in the freedom space, in the smaller government space, in leadership development. I kind of became their go-to person in Australia”.

Bernardi signed up for a training course with the Leadership Institute in Virginia where he learnt about using what he described as "voter databases and online technology to mobilise grassroots campaign...These tools would prove vital in the fight to block Labor’s climate change policy."

Bernardi watched the billionaire fossil fuel barons, the Koch brothers and their billionaire allies, poured hundreds of millions of dollars into countless Political Action Committees and lobbyists. They finally took over the Republican Party, its membership, and through preselection contests, determine Republican candidates in state and federal elections.

On returning to Australia, Bernardi’s influence on Minchin, and later Andrew Robb, made opposition to action on climate change a defining Coalition policy.

Wilkinson equally examines all the compromises and divisions between Labor and the Greens over climate change policy options. She presents a brilliant forensic examination of the dysfunctionality of Australia's federal political system.

For anyone interested in the backstory of Australian government processes, Marian Wilkinson’s analysis is a must read (including 101 pages of Chapter Notes)

Marian Wilkinson is speaking about her book and joining a Q & A at the Maleny Community Centre, 23 Maple Street, Maleny on Thursday 8 April 2021 at 6:00 PM to 8:00 PM. Event organised by www.outspokenmaleny.com. Book tickets online fast.

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From the period August 2020 until December 2021 I resumed being a Radio Journalist at my local radio station, Bay FM, Byron Bay, (where you will find my stories appearing in the Community Newsroom section of ​http://programs.bayfm.org/community-newsroom) serving New South Wales Northern Rivers region, and still contributing the odd story the The Byron Echo.

In December 2021 I moved to Kandanga, just 20ks south of Gympie in Queensland and commenced writing for Gympie Living, a local monthly magazine where I cover major political issues at a local, state or national level.