Increasing unemployment, soaring living costs and the environmental and social impacts of unexpected severe rains and flooding in parts of NSW are impacting on more poor and working-class people and extending into sections of the middle class. But the pro-capitalist policies of the NSW O’Farrell Coalition government, carrying on from its Labor predecessor, are providing no relief.

The O’Farrell Liberal-National Coalition easily defeated Labor at the March 26 state elections last year, winning 69 seats in the 93-seat lower house. The anti-Labor vote by the majority of working people came on the back of 60% increases in public transport fares and electricity prices over Labor’s 16 years of corrupt and right wing governments, which financed corporate tax breaks, particularly for property developers who made up the bulk of donations to Labor – more than $14 million since 2001.

Labor prepared the way for the Coalition to deepen its big business polices. Labor supported big business by handing over public assets to profit-oriented state government corporations or to fully privatised companies via public-private partnerships. Their profit-gouging meant substantially increased costs of living for millions of people as essential public facilities like schools, hospitals, public transport, housing and basic infrastructure seriously deteriorated, and bills rose for electricity, gas and water services.

Business agenda

A year on and six months after the O’Farrell state government’s first budget, big business is urging it to remove “impediments to productivity”, cut workers’ wages and conditions, sell more public assets and improve their ability to increase profits, while describing the state government budget “reforms” as too slow. Placating business and with an eye on the next state election in three years, O’Farrell said in March that the creation of the mega-agency Transport for NSW, the overhaul of RailCorp, the looming privatisation of Sydney Ferries and setting up Infrastructure NSW, were significant reforms.

But debt is increasing, which the recent natural disasters have exacerbated. Bankruptcies driven by credit card debt and chronic unemployment have increased. The Insolvency and Trustee Service Australia revealed that the top six areas for bankruptcies were in the Sydney areas surrounding Mount Druit, Campbelltown and Liverpool, with a total of 453, followed by the Central Coast area with 300 bankruptcies in the last financial year. The more wealthy areas of Sydney, Mosman and Spit Junction, had 22 debtors file for bankruptcy, followed by 19 in Dover Heights and Vaucluse, reported the April 11 Sydney Morning Herald.

The state government described its first budget in September as “cautious”. Treasurer Mike Baird announced $8 billion in cuts over four years for a budget deficit of $718 million in 2011-12 (mainly from a collapse in revenue including stamp duty and GST payments of more than $900 million since March 2011). This is a strong indication that people have less to spend. But the government expects to squeeze out a surplus from the majority of working and poor people totalling $600 million over the next three budgets.

The budget cuts included 5000 public sector jobs through voluntary redundancies; privatisation of Port Botany and the Sydney Desalination Plant to pay for road infrastructure; restrictions on first-home buyer stamp duty exemptions to newly constructed homes; and increased household power bills. The budget entrenched more disadvantage for poorer families, with all publicly owned preschools, including 24 in Aboriginal communities, now charging fees, the same as community-run preschools, of $40 to $50 a day. Education minister Adrian Piccoli said that “the most needy families and parents doing it tough’’ would receive fee relief after fees were introduced, but Labor opposition education spokeswoman Carmel Tebbutt pointed out that some parents could not afford to pay fees in the first place.

The state government claims a $1.9 billion budget shortfall in the Department of Family and Community Services will need to be clawed back over four years, but says this will not affect caseworkers. The minister for family and community services, Pru Goward, hypocritically stated in the budget debate last year that the well-being of children and young people depended on the department being financially viable.

Children lose out

There are more than 43,000 people on the Housing NSW waiting list, and 17,400 children now in out-of-home care. The Coalition government has also hit single age, disability and carer pensioners with higher rents in public housing (taking $11.90 from the $17.65 in pension increases).

The state government will transfer foster care to non-government welfare agencies. Goward told ABC radio’s The World Today on April 11 that the transfer would take five years, with the first 400 files of non-Aboriginal children being handed over to NGOs by mid-year. Goward said 35 out of 37 NGOs have signed contracts and will be paid $37,000 per child. This is a massive pay cut, said Patray Moncacha, president of the NSW Foster Carer Association, from the $60,000 that was paid previously.

Steve Turner, the assistant general secretary of Public Service Association (PSA) of NSW, said that the government is responsible for children assigned to it by the courts, and Community Services carries out that responsibility.

The government has also excluded surrogate parents and foster carers from paid parental leave. “Clearly, regardless of how a baby comes into a person’s care, that parent deserves equal rights to paid parental leave”, said Turner on February 2. “The PSA is particularly concerned that exclusion of paid leave for foster carers is hitting Aboriginal communities. Babies are placed into kinship foster care arrangements in Aboriginal communities at a higher rate than the non-Indigenous community. The status quo requires Aboriginal women to take unpaid leave in order to care for the baby – this is clearly an unacceptable situation. The NSW government should be supporting foster carers in the public service, not discriminating against them.”

The government pushed through 2.5% annual wage caps for public servants, and cuts to the police death and disability scheme despite large union protests and mass meetings in June and September 2011.

But O’Farrell backed down under pressure from his own MPs, the solar industry and consumers on retrospective cuts to the feed-in-tariff on the solar bonus scheme. Environment minister Robyn Parker last year faced calls for her sacking over the handling of a series of chemical leaks from Orica’s Newcastle plant.

Transport minister Gladys Berejiklian delayed a planned light rail extension to Dulwich Hill and mothballed the Greenway cycle and walking path plan alongside the light rail.

Pushing privatisation

According to Australian Bureau of Statistics data, NSW lost 31,200 jobs in the year to February, but the government claims 20,000 jobs have been created since it got in. Mining areas such as the Hunter are booming, while other areas such as Canterbury-Bankstown and Fairfield-Liverpool have reached 8.3% and 7.3% unemployment respectively.

A carefully constructed campaign to convince the majority of workers that they will get much needed infrastructure only by selling off more public assets to the private sector, already partly under way under Labor, is in full swing under the Coalition government. The NSW Business Chamber said it wants the state’s power assets fully privatised, after O’Farrell announced in the September budget that the generators would be sold off, but the poles and wires held in public hands.Former Liberal NSW premier Nick Greiner was appointed chair of Infrastructure NSW and is helping the state government break down public resistance to the privatisation of more public assets by saying that there are no operating surpluses to fund new infrastructure. High state debt levels, he added, made it more difficult for the government to borrow for new infrastructure projects. “That really leaves you, in terms of new money, with two areas: asset recycling or private funding”, said Greiner in the April 7 Australian.

Developers are complaining about the government’s popular measure of abolishing the Part 3A approvals process for major developments, which could be approved by the ministers and bypassed local councils. But the O’Farrell government has not supported farmers in their campaign to stop mining on agricultural land and forcing miners to face scientific panels to gain approval to mine such areas.

The Greens uranium spokesperson in state parliament, Jamie Parker, has condemned the government for overturning the 26-year moratorium on uranium exploration on April 3, saying the government has no mandate for uranium mining.

And women have gone backwards, said the NSW opposition in its March 8 report on the first year of the O’Farrell government. The Coalition has failed to deliver on a number of promises including to create statistics on the status of women, downgrading women’s policy; it is making trade-offs that adversely impact on women, not supporting equal pay for social and community service workers; making nurses pay $10,000 to re-enter the workforce and introducing preschool fees and cutting funding for IWD events.

Infrastructure

The scale of long promised (but never delivered) infrastructure projects by successive NSW governments have awakened even some capitalist politicians to the need for some sort of long-term plan, which the O’Farrell government is pushing. But its priorities are not what is clearly needed, e.g. large scale and sustainable public transport. Real democracy is not the farce of parliamentary elections every four years. Decisions that affect the vast majority of people are decided only by small groups of capitalists in the pursuit of increasing profits.

The international rating agency Standard and Poor’s has warned the state government that its budget aimed at reaching a surplus before the next state election is “too ambitious”, meaning that more attacks on workers wages and conditions are needed. Underpinning the O’Farrell government’s policies is the expectation that there will be improvements in the state's economy driven by private spending, including business and housing investment. The Coalition budget also optimistically predicted “continued improvement in export growth”.

But the forecast growth of state product for 2011-12 has been downgraded from 3.5% to 2.5%, increasing to 3% in 2012-13. Employment growth is expected to fall from an estimated 3.1% in 2010-11 to just 1% in 2011-12.

The defeat of one big business parliamentary party by another doesn’t change the underlying system of exploiting workers’ labour and shifting the effects of the global economic crisis onto the working class.

Direct Action – April 15, 2012