Australia news live: gambling lobby attacks Labor’s ‘moral judgment’ after $90m tax breaks for research abolished

Caitlin Cassidy

University bodies have welcomed the federal government’s additional $2.5bn commitment in the Myefo to establish a new managed growth funding system and introduce needs-based funding for universities.

Universities Australia chief executive, Luke Sheehy, said the commitments recognised the “vital role” the sector played to “drive prosperity and tackle workforce shortages”.

He said:

From helping more Australians from disadvantaged backgrounds access higher education to creating a funding framework that supports long-term sustainability, these investments will strengthen our universities across cities and regions, benefiting the entire nation.

Sheehy also welcomed the establishment of the Australian Tertiary Education Commission (ATEC) to provide independent advice and sector reform, announced in a release by the education minister today. The body will operate permanently from 2026.

The release also hinted at the removal of Ministerial Direction 107, which has been operating as an effective international student cap. Sheehy said certainty and stability were now “urgently needed” to ensure the continued global competitiveness of Australia’s international student sector and stabilise numbers.

The Australian Technology of Universities executive director, Dr Ant Bagshaw, said the body could now see a “path forward” which could support growth ambitions of the sector.

Caitlin Cassidy

Budget update a ‘missed opportunity’ to better fund public schools – union

The Australian Education Union has labelled the federal government’s Mid-Year Economic and Fiscal Outlook (Myefo) as a “missed opportunity” to fully fund public schools.

The Myefo confirmed there would be no additional funding or agreed school reforms for public schools in Victoria, New South Wales, Queensland and South Australia, which remained in a standoff over who would front a 5% gap in school funding.

Data from the Australian Curriculum, Assessment and Reporting Authority (Acara) shows that 98% of public schools are underfunded and the majority of private schools are overfunded.

Union head Correna Haythorpe said the gap would “deeply impact” public schools’ resources and leave them underfunded until at least the end of 2025:

This is money the federal government is quite literally leaving on the table.

The opposition’s education spokesperson, Sarah Henderson, said Labor had failed to deliver “full and fair funding” as the education minister, Jason Clare, had promised. The Coalition, when it was in power, capped Commonwealth funding for public schools at 20%, leaving a shortfall of 5%.

Henderson said:

After nearly three years, Jason Clare has shown he is not up to the job of supporting Australian schools including delivering explicit instruction, the Year 1 phonics and numeracy test, performance targets and other evidence-based teaching reforms to ensure every child can reach his or her best potential.

Clare said the government had reached agreements to increase funding to public schools in Western Australia, Tasmania, the Northern Territory and the ACT

He said:

Our offer to the remaining states remains on the table.

Gambling lobby hits at Labor’s ‘moral judgment’ after $90m tax breaks for research abolished

Henry Belot

The gambling industry’s lobby group has criticised the federal government’s “moral judgement” after confirming bookmakers would no longer receive tax breaks for research on wagering.

The federal government’s mid-year economic update (Myefo) confirmed gambling companies would be stripped of their access to the tax concessions, after Australian Tax Office figures showed they had claimed almost $90m in a single year.

The treasurer, Jim Chalmers, described the use of the tax breaks by bookies as “problematic” in October.

Today’s Myefo papers said research and development for gambling could “exacerbate addiction and associated harms, while activities related to tobacco can increase health risks”.

The Myefo said:

Excluding these activities will ensure that the government is not subsidising this type of research and development.

Kai Cantwell, the chief executive of Responsible Wagering Australia, attacked the decision and said it “opens the door to tax policies becoming a tool of moral judgment rather than a driver of economic growth”.

He said:

Our industry was not consulted by the government on this decision – this is not how governments should engage with industry and it’s not the way to achieve effective policy outcomes.

The government’s announcement sets a dangerous precedent for how tax policy could be misused in the future – today it’s gambling companies being targeted, but any industry could be next if it’s used as a bargaining chip or horse-traded in future political deals.

If I represented fast food, alcohol, fossil fuels or any other industry that face similar criticisms, I’d be worried. This cherry-picking approach undermines the neutrality of the tax system and leaves businesses guessing who will be targeted next.

Budget update a missed opportunity to address key issues: Saul Eslake

Peter Hannam

Investors don’t appear to have been very moved by the federal government’s mid-year economic and fiscal outlook (Myefo).

Stocks will probably end the day little changed and the Australian dollar was pretty flat (although it has lately extended its retreat against the US dollar at least).

Bond yields were also little moved, implying little joy in a smaller than expected budget deficit this fiscal year nor little extra concern that the budget deficit will be $23bn-plus worse in the subsequent three years.

Saul Eslake, a seasoned commentator on the economy, isn’t convinced about the government’s claims of additional “unavoidable” spending.

Eslake said:

I’m not saying they are bad decisions – but they aren’t ones that absolutely had to be taken.

Unavoidable isn’t a synonym for politically difficult. What the government has avoided is making any decisions as to how this additional spending should be paid for.

It has been clear for some years now – since before this government came to office in May 2022 – that government spending is permanently on a higher plane of about 26.5% of GDP, which is about 1.75 percentage points of GDP higher than the average between the mid-1970s and the onset of the Covid-19 pandemic.

Eslake has said the public wants more spending on health, the NDIS and childcare, but it will get more spending on defence (“whether the public ‘wants’ that or not”), and there’s the increase of $500bn in federal government net debt since the global financial crisis (circa 2008), which brings a big interest cost.

Eslake said:

Neither side of Australian politics has been willing to have an adult
conversation with the Australian people about how all this additional
spending should be paid for.

Pesutto says Deeming’s return to Liberal fold a matter ‘for party room’

Benita Kolovos

Pesutto was also asked about the upcoming vote on Moira Deeming’s return to the Liberal party room, which will take place on Friday.

On Monday night, Liberal MPs Chris Crewther, Renee Heath, Joe McCracken, Richard Riordan and Bill Tilley revealed they had signed a petition to hold a special party room meeting to reinstate Deeming.

Deeming was expelled from the party in 2023 after she attended a rally that was gatecrashed by neo-Nazis.

A federal court judge last week found Pesutto defamed Deeming by falsely implying in comments he made after the rally that she knowingly associated and sympathised with neo-Nazis. The judge ordered Pesutto pay Deeming $300,000 in damages.

After the judgment, Deeming said it was her expectation to be let back into the party room.

Asked whether he would welcome Deeming back, Pesutto said:

They’re matters for the party room, and they’ll discuss those on Friday morning.

On his leadership, Pesutto said he was getting “positive feedback” from his colleagues but admitted “we’re a broad party room, so not everybody’s going to agree on every issue”.

He said:

I work every day to earn the trust and confidence of my colleagues, and I’ll continue to work every day. I never take my roles and responsibilities for granted.

I know that every day, I get up and I do the very best I can for the people I’m here to serve, and that’s ultimately the Victorian people. But I also need to show my colleagues every single day that I’m worthy of their trust.

Pesutto says Victorian government’s CFMEU report a ‘whitewash’

Benita Kolovos

Victoria’s opposition leader, John Pesutto, has responded to the CFMEU report that the state government released earlier this morning, describing it as a “whitewash”.

He said the report’s terms of reference were narrowly set by the Victorian government to “avoid responsibility and accountability”.

Pesutto told reporters at parliament:

This report is pathetic. It is a hopeless attempt to address a very serious problem affecting not only the delivery of major projects but our economic performance as a state and our soaring debt levels, but it’s precisely what premier Jacinta Allan wanted.

This was not a serious report that took evidence, held public hearings, investigated criminal allegations, actually enabled proper submissions to be made that the Victorian people, businesses and households could actually read.

Rafqa Touma

Thanks for tuning into today’s live blog. Handing over now to Catie McLeod, who will keep your news rolling into the evening.

Peter Hannam

NSW’s midterm budget points to short-term deficit increase variance

Apart from the Commonwealth’s mid-year update (see here and also my takeaways here), New South Wales has also taken today as a good time to release its half-yearly review.

While the Albanese government is claiming this year’s deficit will be $1.3bn better than projected in its May budget, the Minns NSW counterparts are projecting a $1.35bn negative “variance” from the 2024-25 year compared with its budget.

That seems to imply NSW will post a deficit this year of about $5bn since the previous shortfall was an estimated $3.6bn.

Unlike the federal budget, though, treasurer Daniel Mookhey and finance minister Courtney Houssos are predicting improvements in the subsequent three years to the tune of about $1.1bn. The fourth of the forward estimate years, though, has a $240m worsening – although the further into the future, the lighter the “pencilling in”.

Anyway, the decline for the current year is blamed on extra insurance expanse, and more costly debt repayments. There’s also a drop in state tax and a curious $440.8m reduction in revenue from Sydney Water “due to a reporting error”. (Surprising that didn’t leak, I guess.)

Perhaps a bit of a surprise too that the $6.6bn “public sector wages investment” (AKA higher salaries) can be “accounted for by offsets and productivity gains, creating no additional debt”, or so the government says.

Unlike the federal government, though, the Minns Labor government doesn’t have to go to the polls soon, with the elections not scheduled until March 2027.

The opposition’s Treasury spokesperson, Angus Taylor, says the midyear economic update (Myefo) shows “red ink as far as the eye can see”.

Taylor held a press conference in Canberra a short time ago, where he criticised the Albanese Labor government for the results of the midyear economic update (Myefo).

Released today, the Myefo shows Australia’s federal budget is on-track for a deficit of $26.9bn this financial year and is not projected to return to balance until 2034-35.

The update breaks Labor’s streak of two full-year budget surpluses with a deficit in its third year, albeit one that is $1.3bn smaller than projected in May.

Responding to the update, Taylor said:

This is not free money. This is the biggest-spending government we have seen outside of wartime or crisis, the biggest-spending government outside of wartime or crisis.

And there is absolutely no pathway in this update to a restoration of Australians’ standard of living.

Taylor said that in the past 2.5 years, Australia had for the first time experienced seven consecutive quarters of household recession, with GDP per capita going backwards.

Kelly Burke

Sydney’s Museum of Contemporary Art will begin charging an entry fee in 2025 for the first time in more than two decades.

Free general admission was introduced in 2000 under the directorship of Elizabeth Ann MacGregor with the aid of a Telstra sponsorship.

But stagnant government funding has forced the museum’s hand, with the introduction of a $20 entry fee from 31 January. That fee will rise to $35 if visitors want to also see its major summer or winter exhibitions.

Concession tickets will be priced at $16 and $28 respectively, however visitors under 18 and students will continue to have free entry.

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