The OECD ‘advice’ the PM didn’t want

The $1m-plus of taxpayer money spent on getting Mathias Cormann the top job at the Paris-based OECD will have no benefit for Australia.

Mathias Cormann was appointed Secretaty-General of the Organisation for Economic Co-operation and Development earlier this year.

The OECD report on Australia blows out of the water the claim by Prime Minister Scott Morrison that spending well over $1m – that’s at least ‘200 Cartiers’ on his own measure of taxpayer waste – to get former finance minister Mathias Cormann the OECD top job, was worth it to give Australia a voice at the very top of such an important international grouping.

Heck, it couldn’t even get Cormann himself such a voice, far less either the politics or the policies, such as they are, of the Morrison government – or, more idealistically whatever ‘Australia’ represents these days. Far from Cormann having the slightest influence on the Eurocentric Brussels-style focus of ‘the markets you have provided they are controlled by our bureaucrats’ – if you think that’s a contradiction, well, that’s what Europe is – the opposite was always going to be the case.

Secretary General of the Organisation for Economic Cooperation and Development (OECD) Mathias Cormann looks on during a press conference in Berlin, Germany. (Photo by Clemens Bilan - Pool/Getty Images)

Cormann was always going to be a mouthpiece for that European command and control and above all pompously virtue-signal approach to political economy. Let me quote you some of the things that the OECD demands we should be doing – instructions dressed up as recommendations – that for some reason treasurer Josh Freydenberg ‘omitted’ in his comments on the report.

Under the heading “Climate change policy needs to be strengthened” – oh yeah? - the OECD wants us to commit to net zero 2050 carbon (sic) emissions.

And what’s the best way to get there? “A national carbon price (otherwise known as a carbon tax) would be the most efficient means of achieving this.”

Nice of the OECD to remind us all of Cormann’s life-time campaigning for net zero and a carbon tax. Or am I confusing him with Bob Brown? That was only the start in the Cormann-lite report.

The OECD wants the government to increase the GST or broaden its base – like, taxing fresh food – to finance income tax cuts.

Gee, I can see a current Treasurer thanking a former finance minister for that inspired advice for what could be the central plank in the government’s coming election campaign. Not.

The OECD does seem dimly aware that all the GST revenue goes to the states; so if the government actually did increase the GST and cut income taxes, it would be free money to the states and a bigger federal budget deficit.

Australian Prime Minister Scott Morrison Picture: NCA NewsWire / Gary Ramage

So it talks vaguely about the GST hike might “be best pursued through the National Federation Reform Council”. That’s to say, advice to the federal government to embark on a pointless vote-losing campaign.

The OECD wants the government to include the entire value of the family home in the age pension means test.

That’s another vote-winner from Europe-central which will be embraced by the pollies on both sides of the political divide like an armful of month-old unrefrigerated fish. I have to say I’m surprised the OECD wimped out on taking that recommendation a step further – to remove the family’s home’s exemption from capital gains tax.

But never fear CGT didn’t miss out: the OECD does want the CGT discount reduced. The OECD recommends increasing taxes on super. Gee, just like Labor proposed in 2019.

Now to be fair, Cormann as secretary-general could not have been expected and never was going to personally re-write this sort of report. But that’s entirely the point. He could not be expected and never was going to change the entrenched Eurocentric Brussels-bureaucratic (even though the OECD is in Paris: it’s the same thing) mindset and direction on anything.

The only thing the $1m-plus of taxpayer money bought was a $360k a year job potentially for the rest of his working life for Cormann. Most OECD heads get 10 years, his immediate predecessor had it for 15. ‘Ironically’, given the taxpayer spend, the $360k a year is tax-free for Cormann. Plus perks

Originally published as The OECD ‘advice’ the PM didn’t want