THE COALITION GOVERNMENT has squandered hundreds of billions of dollars through either incompetence or, worse, deliberate intent to enrich its foreign mates. Most of the frittered funds are gone forever. But maybe not all.
The vast wealth and income lost over the last eight years through export corporations that pay little or no tax may actually be traceable and recoverable, in part at least. This will require an investigation with the powers of a royal commission and broad terms of reference. It will also require a change of government.
Exhibit A before this proposed commission is data from the Australian Bureau of Statistics (ABS) showing that merchandise exports have boomed since 2015. The value of all goods bought just by China last year was 2.4 times higher than in 2015. See green chart below.
This surge has generated phenomenal wealth. If 2015 export levels had just been maintained for the following six years, total sales would have been $451.2 billion — almost half a trillion dollars. That is extraordinary treasure for a country of just 25 million people.
But 2015 levels were not maintained. They were exceeded by a whopping $320.1 billion. Revenue over the last six years just from exports to China was $771.6 billion.
That is a fair slice of Australia’s gross domestic product (GDP). See green and red chart, below. Exports to China in 2015 were valued at 4.14% of GDP. By 2021, they had more than doubled, to 8.66% of GDP.
But did these exports actually contribute significantly to Australia’s GDP? That is the question.
Taxes not collected
Evidence is scant that Australians have derived much benefit at all from this phenomenal boom in export volumes and values.
Whereas exports to China have gone from 4.14% of GDP in 2015 to 8.66% in 2021, company taxes collected have shifted over that time from 3.73% to just 4.90%.
Exhibit C will be the Tax Office’s annual transparency reports which show that most large exporters of Australia’s immense minerals and energy wealth pay little company tax, if any. Since Tony Abbott became Prime Minister in 2013, they have not been required to.
Total exports also booming
Although this analysis focuses on China, there is a pattern. Exports to Japan have increased 57.8% since 2015, to France by 67.3%, to India by 88.2%, Germany by 90.8% and Indonesia by 101.8%. Overall, exports have risen 83.9% since 2015. See blue and green chart, below.
Quite clearly, if the Government was retaining a fair share of this extensive wealth sent offshore, there would be plenty of revenue to increase pensions, benefits and wages, to catch up on infrastructure long overdue, then to balance the budgets and repay the debt stacked on unnecessarily since the end of the Global Financial Crisis.
Of these 38 wealthy, developed OECD nations, 11 have reduced their debt through that period of global good times. But not Australia.
Questions for a commission to explore
Among the many questions arising from the disappearing export revenue are these:
- Former Trade Minister Andrew Robb resigned from Parliament soon after completing Australia’s ill-fated trade deal with China. Virtually the day he left, he started working for the Government of China on a reported $880 thousand per year. What was the relationship between Mr Robb and China’s Government before leaving Parliament? What has it been since?
- Several other former Coalition ministers now work for foreign interests. What are the relationships between other cabinet members and the governments of those countries which have benefited most from buying Australia’s exports?
- What export companies have evaded company taxes due and payable in Australia over the last eight years? What are the mechanisms for recovering these losses?
- Have there been any flows of funds from the foreign corporations profiting mightily from the current regime back to politicians or political parties in Australia? Are these funds recoverable?
- What has been the role of Australia’s statutory authorities in facilitating this loss of Australia’s wealth and income? These include Treasury, the Finance Department, the Taxation Office and others. (The one department which bears no blame is the Bureau of Statistics which has faithfully recorded all the data which shows vast wealth sent offshore for meagre return to the people of Australia. How the other departments can have read this data but done nothing must be investigated.)
- What has been the role of the big, foreign-owned media corporations in concealing this massive fraud from the general population?
Did we mention that convening this royal commission and recovering these hundreds of billions will require a change of government? Please share this wherever possible.
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