Raise tax to fund reforms

Labor senator Doug Cameron has declared it is “inconceivable” Prime Minister Julia Gillard will be able to fund the planned reforms of aged care, education and disability services from existing revenues, calling on the government to raise taxes by $11.5 billion a year to pay the cost.

Senator Cameron challenged the view that Labor must move to the right to increase its appeal, urging his party to dedicate itself to "a new social contract" built on full employment, decent living wages and a social safety net.

“When did it become wrong to raise sufficient tax revenue to ensure a good society?" Senator Cameron asked.

"When did we start trading off decent aged care, a great education system for all, and care and compassion for those with a disability in return for the boast that we are one of the lowest-taxing countries?”

Labor's hopes for re-election partly rest on the trio of big-spending reforms, including a $15bn a year National Disability Insurance Scheme, a $3.7bn increase in aged care funding and a $5bn a year boost in education spending in line with the landmark report by David Gonski.

“There wouldn't be enough public servants to sack, there wouldn't be enough government programs to cut without significantly affecting services to the public,” he said.

"But if taxes were raised for the specific purpose of paying for the services, Australia's ration of tax to GDP would increase by just 0.75%.

“We would retain our ranking as the fifth-lowest taxing country in the OECD, and we would have a world-class aged care system, a world-class disability insurance system and a world-class public education system.”

He added that building “a good society cannot be done on the cheap”.

“I am convinced that with proper explanation to the public and courage from government we can deliver for those who need our help and support.”