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March 2015

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I want to briefly follow my piece, in part, decrying the lack of values-based policy debate in Tasmania.   

This week has further highlighted the issue.

The cost of connecting your new home to ‘stuff’

In principle, the State and Federal Liberal Governments are dealing with basically the same issue in two completely contrasting ways.

Water and Sewerage connection

Headworks charges are payments for defined costs of new or existing water and sewerage assets deemed to be attributable to the new development (i.e. to purchase capacity in the system).

In his State of the State address, Premier Will Hodgman claimed the Government has ‘abolished’ headworks charges in Tasmania. 

It hasn’t.

It has socialised them.  Instead of the developer paying the charges, the cost is now ultimately borne by taxpayers – the vast majority of whom have nothing to do with the development. 

Is that fair? No.

Is it efficient?  Absolutely not. 

The cost of connecting new developments to the water and sewerage network is a legitimate cost that should be borne by the property developer.  If Government wants to reduce the cost of new development, it should focus on conveyance stamp duties which are economically inefficient according to the Henry Tax review.

NBN connection

At the same time as the State Liberals are socialising the cost of headworks charges, the Federal Liberals are doing the opposite with the cost of connecting new premises to the NBN.

Developers will now pay $600 and new home owners will pay $300 to connect new homes to the NBN.  So the Federal Government is reversing the socialisation of the cost of connecting new homes to the telecommunications network.

My Point

How can the same political party act in completely contrasting ways on the same basic issue:  the cost of connection (of stuff) to new homes?

What are the principles that underpin this political party?

How can two opposite policy positions both be consistent with the values of the Liberal Party?

I’m no expert on Liberal Party beliefs, but I’m pretty sure it’s the Federal Liberals who are acting in accordance with the values of the party.

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