Melbourne needs Choo Choos!
The Victorian Government wants to, needs to, spend billions on Melbourne transport to catch up with the city’s explosive growth.
As John Legge kindly points out in a must-read at The Age: “The affluent have crossed the Yarra and now colonise almost all of the zone-one public transport area, delighting in the benefits of the public transport system built by our ancestors. They enjoy frequent tram services and fast and comfortable trains.”
All Melbourne should enjoy high transport service standards – this is a prosperous country and we glory in our ‘Most Liveable City’ status.
Citizens in freshly minted suburbs are screaming for the rail lines, freeway interchanges and bus routes the developer’s salesman told them about. And those long work commutes are highly correlated to divorce.
Victoria prizes its AAA credit rating, so big loans are out. Meanwhile, the steep fall in conveyancing Stamp Duty is tearing a big hole in current revenues. The L/NP coalition would love to announce city-making infrastructure projects, but haven’t got the money. Our poor Premier must plant trees, plant trees, plant trees, while a narrative builds that he is a ‘Do Nothing’ leader and his popularity sinks.
Legge is not just a carping critic. He kindly offers a solution, a property tax, saying: “A rate of 0.1¢ in the unimproved capital value dollar would raise about $1.7 billion per year, while half of all households would pay no more than $11 a week.”
I want to let you in to a secret: this tax base already exists. It is called State Land Tax. In 1998, L/NP Premier Jeff Kennett exempted the principal place of residence from this tax with a stout yeoman cry about ‘The Family Home!’
And now government can’t afford to provide the family home with transport.
From time to time, you will hear about the ‘vertical fiscal imbalance’, whereby the states’ expenditure responsibilities vastly exceed their own revenue-raising powers. Yet here is a tax base prized for its efficiency and fairness that Victoria declines to collect.
If it did, and invested the money in transport infrastructure, our quality of life would rise. Isn’t that what government is for?