Last night’s Federal Budget drew a line in the sand. It could be seen as the last big roll of the dice for the Gillard Government in its hope to be re-elected in September. It could also be viewed as a Budget that goes to the heart of Labor values – perhaps in the hope of maintaining as much of its heartland as possible.
The question for voters is whether the longer term national interest – of the ‘Gonski’ school funding reforms and the national disability insurance scheme – outweighs individual interest. Treasurer Wayne Swan said the budget was “about the Australia we want to leave our kids and our grandkids”.
It is a budget that places education as the key to economic and intellectual fulfillment for an individual and ensures that, as a society, in a financial sense we have a responsibility to look after those who are amongst the least fortunate in our community. The various savings measures outlined contribute $26 billion towards Gonski and $52 billion towards the national disability insurance scheme (NDIS) over ten years.
But if you believe that individuals, families and business are the key to achieving national economic prosperity, you won’t like it.
For a start, the Baby Bonus introduced by John Howard has been abolished for higher income earners and is replaced by a reduced payment to be rolled into Family Tax Benefit A. That’s a saving of $1 billion over four years. There is also a reduction in the time allowed to claim family tax benefits and child care assistance.
Personal income tax cuts that were expected in July 2015 – yes, that’s two years away – have been deferred based on the carbon price reaching $25.40. It’s estimated to be less than half that by then.
If you’re a small business, as many mum’s are, PAYG will move to a monthly payment rather than the quarterly payment currently permitted in some circumstances.
The rebate for Medicare will be “realigned” by eight months – to use the budget parlance – but deferred in the eyes of affected GPs, saving $670 million over four years. It is unclear what impact this will have on individual health consumers and the rate of bulk billing.
And one strange one was a saving of $1 billion in asylum seeker costs, with savings to start in future years. It's almost an admission that a Tony Abbott government may have success in 'stopping the boats'.
There are some small and welcome ‘goodies’.
Cancer research and services will receive $65 million next year, with $29.5 million for chemotherapy, $12.5 million for extending breast cancer screening, $4.5 million for the McGrath Foundation and $4 million for prostate cancer.
Sport has managed to secure a further $39 million for extension of the Active After Schools program, although it should be noted that it is a program with mixed reviews in respect of increasing participation in sport of children from lower socio-economic groups.
$24 billion is to be spent on national road and rail infrastructure with big ticket items including Melbourne Metro rail, the F3-M2 link in Sydney and the Brisbane River rail project.
Despite the protests of yesterday at some universities around Australia at the cuts announced a few weeks ago, universities will receive a funding boost for research infrastructure and Commonwealth-supported university places for people from lower socio-economic backgrounds.
And, in good news for older Aussies, they will be able to downsize and sell their home without it affecting their pension for 10 years.
Mr Swan identified $121 billion in savings over the next decade and said that the Budget would return to surplus in 2016-17 with a deficit this financial year of $19.4 billion. If the political opinion polls are accurate, he is unlikely ever to be called to account for it one way or the other.
__small.png)
