Queensland Nationals senator-elect Barnaby Joyce and Queensland colleagues have suggested their own long-term solution: generous tax concessions in regional Australia to attract infrastructure investment.
The Queensland Nationals, who will play a crucial role in the Senate from July 1 after helping deliver the Coalition a majority, say flat and favourable tax rates in depressed rural areas would breathe new economic life into the bush.
Mr Joyce, who is championing the "zonal taxation" proposals, argues the tax initiative would be cost-neutral because it was the fastest way to turn welfare recipients into working taxpayers.
The proposal continues in a long tradition of the city subsidising the country. Many of the beneficiaries of this proposal - and the current 'drought rescue' package going through Cabinet - are farmers who have seen many good harvests in recent years, yet have set aside insufficient funds to cope with tough times. In the same way that businesses in the city need to plan ahead for uncertain times, bush dwellers can't expect to be bailed out because the sun shines too much. Besides, many of these farmers are working in highly wasteful and unprofitable fam sectors, and there would be little lost if they were to leave farming and use their resources more productively in other ways.
There is the small problem, of course, that the Joyce proposal might not be consitutional (Section 51 - The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to:- (ii.) Taxation; but so as not to discriminate between States or parts of States). But never fear, the Queensland Nationals were never too phased about Constitutions, the separation of powers, that sorta thing. Right, Sir Joh?
This proposal is a dud, but at least it's an innovative dud.
BJ: Now we know why he's smiling.