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Sir Lunchalot Dutton and some uncomfortable truths

by Michael Pascoe | Jan 21, 2025 | Comment & Analysis, Latest Posts

Opposition Leader Peter Dutton is pulling level with Anthony Albanese as preferred Prime Minister, using the opportunity to launch his free lunch policy. Michael Pascoe explains how dud policy maketh the man.

“Sir Lunchalot” was a title given to crooked former NSW Labor minister and guest of Her Majesty’s, Ian Macdonald. Now Peter Dutton is taking the title.

Seeing the latest polls from AFR/Freshwater Strategy ($), you can almost hear the hamster wheels turning in whatever excuse for an inner cycle Peter Dutton employs to come up with an idea like making lunch great again: “Ask yourself who the media turn to for expert commentary on the economic health of the nation. Café and restaurant owners! If we can capture them, we own the economic debate!”

And so they did.

Australian politics really might be that easy. Given the obscenely cozy relationship the pokie machine monster (alias the pubs’n’clubs industry) already enjoys with both sides of the duopoly, only the cafes and restaurants were up for grabs.

That Dutton is promising tax-deductible feeds for Australia’s 2.5 million small businesses has all the economic responsibility of his nuclear power fantasy is irrelevant. Like the nuclear gambit, it’s the sizzle that counts, not the sausage.

That the Sir Lunchalot title is uncosted is a given. Details, mere details, the last thing the LNP ever wants in this age of impressionism politics. Somewhere, somehow, a consultant will be found to dust off his Trickle Down Economics manual and trot out a spreadsheet showing taxpayer-subsidised lunches could overtake iron ore’s contribution to the Commonwealth, but that doesn’t matter.

Such a thought bubble isn’t about thinking, it’s about the immediate feeling.

I actually did the now-standard full journalist-at-the-coalface extensive research on this topic and asked a local café owner what he thought.

“That’s a good idea, it would certainly get things moving,” he said.

Case closed.

Sir Lunchalot to the rescue

Sir Lunchalot has ridden to the rescue after some years of disaster stories about the hospitality industry. It’s a very tough game, always has been.

Some businesses fail. They always have. Some of the failures were delayed by the COVID assistance, particularly the ATO holding off collecting debts.

Some businesses do well, but they’re not the ones on the 6 pm news.

Higher costs have squeezed margins, and some customers are resisting higher prices. That is what is supposed to happen when the central bank is trying to reduce inflation.

It’s hard to get staff – it’s always hard to get good staff. That’s also an indication of a low unemployment rate, which means the economy isn’t doing too badly.

Spending driving inflation

The repeated cry from the LNP and newspapers about government spending worsening inflation applies doubly to Sir Lunchalot’s plan. A tax deduction is not “free”. It ends up costing as much as the government giving cash. 

A moment’s thought tells us that increasing demand for cafes, restaurants, and clubs’n’pubs will increase prices. The couple of million small businesses won’t resist those higher prices if they think they’re actually paying 25 or 30 per cent less than what it says on the menu.

And the overall “mass bankruptcies” story beloved by the LNP and most media is something of a beat-up ($) anyway. 

Last year, the AFR’s economics correspondent, Michael Read, did as good a job as anyone demolishing ($) the “insolvency Armageddon” story last year.

Cumulative insolvencies are actually running below the pre-COVID trend – it’s the zombie businesses that are fuelling the headlines.

And there’s that bigger productivity story, if anyone was really interested. A key way productivity improves is via the least productive enterprises failing, freeing up resources for the more productive.

For all the headlines about failures, more businesses are starting than are failing.

But Sir Lunchalot doesn’t care about that. The café and restaurant owners certainly don’t.

The one certainty, as survivors of the great long lunch days before FBT was introduced will know, is that

a lurk like this will be exploited left, right and centre.

The LNP’s nuclear policy is working just fine

 

Michael Pascoe

Michael Pascoe is an independent journalist and commentator with five decades of experience here and abroad in print, broadcast and online journalism. His book, The Summertime of Our Dreams, is published by Ultimo Press.

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