Putting a family member at the heart of your pitch for a new tax is a high-wire political strategy.
Scott Morrison chose to take that risky approach in last year’s budget, introducing the nation to his brother-in-law Gary Warren, who is a firefighter suffering from multiple sclerosis.
“I don’t know a finer man than Gary,” a choked-up Treasurer said on the day after delivering his budget, which included a Medicare levy increase to fund the National Disability Insurance Scheme (NDIS).
Mr Warren was in his wheelchair among an audience of journalists when Mr Morrison called on Australians to “chip in for this compassionate cause”.
To manage the political danger of announcing a new tax, Mr Morrison explained it as an insurance levy.
“All of us, but for the grace of God, could find ourselves in that situation, and we’d be expecting and hoping that our mates would be looking after us,” he said.
Sense of betrayal among people with disabilities
The Treasurer has climbed down — or perhaps taken a tumble — from the high-wire, and is instead arguing that the levy is no longer needed.
That has damaged the trust he had built with disability organisations whose members rely on the NDIS.
“It makes sense that the costs of the NDIS are shared by everyone,” Disabled People’s Organisations Australia, an alliance of four disability groups, said last year.
They had urged the Parliament to pass the levy as one component of a sustainable funding base for the NDIS.
“People with disability feel betrayed and ambushed by this decision and are left wondering what else is in this year’s budget,” the alliance’s Therese Sands said on Thursday.
Mr Morrison has insisted the Government is now able to fully fund the NDIS without the levy, the claim that Labor has been making since it set up the scheme.
To try to cover the dramatic flip in his argument, he says that better-than-expected tax receipts and a strong economy make the levy increase unnecessary.
“It is good news. A stronger economy is what guarantees essential services,” he insisted, in a direct contradiction of his own words a year ago.
Disability advocate and former discrimination commissioner Graeme Innes is not convinced, calling it a win for uncertainty.
“This scheme is not appropriately funded,” Mr Innes said.
Dropping the levy hike makes for an easier tax cut
Labor had opposed the levy and argued that when the scheme was originally designed, under their government, it was fully funded.
Mr Morrison has spent a year denouncing that argument as irresponsible and wrong.
It appears clear that this radical shift is to clear the way for an income tax cut in the May budget.
Mr Morrison argued to the National Press Club last year that even if the Government later decided to cut income tax, then the Medicare levy increase meant the NDIS would still be secure.
“Whatever happens with the tax rates in the future, the NDIS is guaranteed,” he said.
But it will be simpler for him to announce a tax break in this budget without the pressure of having to explain why he was also implementing a tax rise in the form of a higher Medicare levy.
Dumping the argument for a levy a year after making it and without testing the support in the Senate exposes the riskiness of using a family member to make the original case.
“I spoke to him last night and he is very pleased — Gary did not want to see people pay more taxes either,” Mr Morrison told AM.
Mr Morrison said his brother-in-law accepts the view that the NDIS will be fully funded.