A bumpy 2017 ride awaits the Turnbull government

Given its crazy approach to pension and super reforms, the government’s poor standing could fall even further next year.

Australian Prime Minister Malcolm Turnbull during House of Representatives Question Time yesterday. (AAP Image/Lukas Coch)

If the 45th Parliament passes the Australian Building and Construction Commission act, and particularly if the ABCC code is linked to the unfair contracts act (Crossbenchers can transform the ABCC bill into something wonderful, November 23), then government politicians and the Senate crossbenchers will enjoy a well-deserved Christmas break.

But the good times will not last because the 2017 calendar year is not going to be an easy one for Government politicians.

The bad news starts on January 1 when some 300,000 Australians discover that their pension entitlements have been slashed.

Accountant Robert Parry tells me that a couple with $600,000 in total assets who currently have a pension of $22,546 will see it fall to $16,832 in January ---- a loss of $5,714.

The people who framed the new rules inserted a great incentive for them to end their formal relationship and split their assets down the middle. A single pensioner with $300, 000 in total assets (half $600,000) will receive a pension of $18,904 in January.

Therefore if the couple is treated as two singles, their post January pension will be $37,808 — a whopping $20,976 more than they get as a couple. They simply can’t afford to stay together. Wait until the popular press gets onto that.

As I have written before, the whole scheme was written by a group of public servants who, having feathered their own nests, could not care less about the community and are forcing people to either split or shed assets at a fast pace because every dollar of assets spent (or invested in the family home) receives a 7.8 per cent return.

In other words, if pensioners in the right bracket reduce their assets by $1,000, then their pension goes up by $78 (7.8 per cent). I have rarely seen anything so stupid.

For about three years this silly legislation will raise money but the angry pensioner market will respond quickly and the 46th Parliament will see the pension bill go through the roof.

In other words, we are swapping short-term savings for long-term pain (Savage pension swipe will come as a Christmas surprise for many, October 26).

I suspect that the people who designed this pension craziness also had a hand in the incredibly complex superannuation legislation. And, so, as 2017 proceeds, those analysing what the government has actually done will come up with crazy after crazy.

For opposition Treasury spokesman Chris Bowen (who is an expert on superannuation) it will be like having Christmas dinner every day.

And all this will happen as we watch Donald Trump create jobs in the US while we decimate one of our largest private sector employers, the automotive industry.

During the last election campaign, Bill Shorten was scared to go south of the Murray because as soon as he crossed the river, CFA trucks would shadow him. It cost him the election.

In 2017 and 2018, every time Malcolm Turnbull ventures south, a Holden car badge will follow him.

Australia’s big chance to develop a new manufacturing industry based on robotics and artificial intelligence was lost when the government took a $50 billion submarine tender that was about designing a new vessel rather than the $20bn tender that gave us Australia-wide manufacturing capacity and saved $30bn.

The Americans under Obama were aghast at the long delays and huge outlays but were diplomatically silent. Trump will not be so diplomatic.

Then we have the end of the apartment boom and a possible loss if our triple A credit rating.

Don’t forget lots of good things will also happen but they will need to or else the Government’s current bad standing in the opinion polls will fall a lot further and by the end of 2017 we will be preparing for PM Bill Shorten.

The government therefore has a lot of work to do in 2017, starting by ending duplication with the states, which will help slash medical and educational costs and boost infrastructure spending. We need to find a way to use the submarine and other defence contracts to restore our industrial base.