Last week we went through my wish list for the RBA to action!
This week I want to talk about our economy and how we can make it more efficient so that we can employ more people. If you have worked your full hours for the week according to your award and you have been asked to work more hours you are entitled to time and a half and then when due, double time etc. However, if you are only employed one or two days a week, those days in the week are immaterial and you start out on normal hours. Why?
Why should working on Saturday or Sunday, if they are the only days you are working, be regarded as any different to working Monday and Tuesday? I used to like working Saturday and Sunday and having Tuesday and Wednesday off in lieu. My "weekend" didn't have peak-hour queues on the road or at restaurants, cinemas and other entertainment venues. It was great!
So now those that are unemployed can manage to get a job on Saturday and Sunday - a time when those that are employed full-time are off. Many a part-time jobs have grown into a full time job from this small start. What is the benefit to consumers? The price isn't loaded up to cater for time-and-a-half, double-time or triple-time - like what happens in the rest of the world.
Next let's look at Government greed - taxes from local, state or federal sources.
Remember when we had high inflation in the Hawke years? These very authorities announced that taxes would "only" increase by inflation. They rubbed their hands with greed and glee. So now, all these authorities can only increase charges by inflation. This means we would only see 1.5% increases across the board. Let's have them working within their budgets like you and I have to.
A significant boost to the economy is to help those who have retired on good assets or intend retiring on good growing assets. Currently the law forbids them to borrow against these assets. The law is framed for those who own shares, of course. Here a part of the shares can be sold off to live on for a year or two watching the balance of the portfolio increase - hopefully!
Those retiring on safe bricks and mortar can't do the same. They can't take the front door down to the supermarket. They can't sell of one of the bedrooms to buy a new car. They have this wealth that should be slowly consumed creating jobs in the community. Currently with banks prevented from lending to self-funded retirees with great assets, these assets must be sold.
Bring back the simple asset lend! This is a safe lend up to 60% of the value of the asset. There is no serviceability because the person has retired. It is like a form of wealth tax. People get their cash, they go and spend it and create jobs in the economy reducing the inheritance that their offspring will receive. They won't fritter away their wealth by having to sell it and watching the new owner benefit from the increase in value. They won't spend the money and end up on a taxpayer- funded pension.
Bring back asset lending to self-funded retirees!
Well, that's my view of a more efficient and prosperous Australia. What is yours?
Kevin Young Club Founder of Property Club