Money has run articles by Noel Whittaker in three consecutive weeks criticising Labors policy to remove cash payments for excess imputation credits where the individual involved has not paid income tax. Unfortunately, these articles have contained several errors or assumptions that mean his conclusions are just plain wrong.

First, Mr Whittaker claims the budget savings are calculated on policy settings that exclude the Turnbull governments 2016 budget superannuation measures, including the $1.6 million tax-free superannuation balance cap. Wrong. Labors policies have been fully costed by the Parliamentary Budget Office, which is independent and legally obliged to cost our policies taking account of government policies - including the $1.6 million superannuation balance cap, and other potential behavioural changes.

Second, in his most recent article, he states that this policy is not a tax on the wealthy, it is a tax on widows. This is not only patently wrong, its offensive. The fact is, the largest beneficiaries of the refundable imputation credit arrangements are higher wealth individuals with large self-managed superannuation funds. In fact analysis by a former senior Treasury official shows that for people of retirement age, 95 per cent of the losses will be borne by the wealthiest 20 per cent. This means that wealthier people will shoulder the majority of the burden of the new policy settings. To suggest that widows will bear the brunt of the policy flies in the face of reality.

Here are a few actual facts: Australia is the only country in the world with fully refundable imputation. Dividend imputation will remain, but cash payments will no longer be made to people who have managed to reduce their tax rate to zero or have paid no income tax. Double tax will continue to be avoided under Labors plans.

As Mr Whittaker notes, Australias interest bill is more than $1 billion a month. Very true. He goes on to claim that policies should encourage people to become self-sufficient and get off welfare. Becoming self-sufficient and not having to rely on welfare is an admirable objective, but this claim misses the point.

Labor is removing the ability to claim cash refunds for excess imputation credits because of its $6 billion annual cost to the budget. To suggest that people receiving the pension are somehow a drain on the budget, while self-funded retirees who access some of the most generous tax concessions in the Commonwealth Budget are not, is just plain wrong.

Labors reforms to excess dividend imputation credits will remove a fiscally unsustainable tax arrangement that is seeing billions of dollars in lost revenue, making it harder for the government to fund important services and return to surplus. Dividend imputation worked perfectly well between 1987 and 2000 when cash refunds werent sent to people who didnt pay income tax. Labor will return to that system. While I understand not everyone will like it, it is necessary and Labor is prepared to be honest about our plans in advance of an election and not surprise people afterwards.

As the Grattan Institute has observed: Generous super and other age-based tax breaks have been funded by deficits. The accumulating debt burden will disproportionately fall on younger households. People in retirement pay less income tax now than they did two decades ago, this despite the increasing demand for more and better services. Even editor of Money,Caitlin Fitzsimmons, when asking whether Labors policy meets the fairness test, her answer was fundamentally, yes.

Given that pensioners refunds will be unaffected, Labors policy ensures that vulnerable people are protected from any impact. Budgets are about priorities. And to get the budget back to surplus difficult decisions need to be made. And yes, making the public case to take something off someone can be difficult, but federal Labor believes that the policy case for reforming refundability and excess imputation credits is a strong one, that its absolutely the right thing to do.

This opinion piece was first published in the Sydney Morning Herald on Sunday, 15 April 2018.