It may be Stockholm syndrome, or possibly the subliminal messaging of about 12,000 pages of budget documents, but I feel an overwhelming urge to tell you that the Budget will return to surplus “on time and as promised”. The government keeps its promises. As promised. They promised a surplus. You’ve got a surplus. As promised.
The surplus will be an itty bitty $1.5 billion dollars at the end of the 2012-13 financial year (as promised). Hopefully. So long as we don’t have any natural disasters or another GFC. In which case, all bets are off.
You see, things can go awry over the course of a financial year. Last year, Wayne Swan forecast that by June this year, Australia would have a deficit of $22 billion. It’s now sitting at $44.4 billion. Tiny blow out.= display_ad('x18', 'hidden-xs hidden-md mm_incontent', 'MM In Content'); ?>= display_ad('x20', 'visible-xs mm_mob_incontent', 'MM In Content (Mobile)'); ?>
As the Treasurer told journalists (captives) this afternoon: “You can’t freeze an economy in time.” He says the instability in Europe, along with the natural disasters of 2011 put unforeseen pressure on the budget. So the sigh of relief from some in the Labor Party may be premature. They’ve delivered the surplus – or at least the projection of a surplus. Now we all have to wait until next year to see if it eventuates.
But there’s no denying, Treasury has done some artful slicing to find $33.6 billion in savings.
SLASH AND BURN
Businesses will miss out on a promised one percent tax cut. The cut was part of the mining tax package, but the government has abandoned it because it was too hard to push through the parliament because the Coalition and the Greens opposed it. Instead, they’ve accepted defeat, and the $4.7 billion windfall that comes with it.
Defence also cops it, with $5.4 billion saved through ‘reprogramming and efficiencies’ – which means, ‘putting things off ’til later’.
The government also found $2.9 billion by delaying foreign aid increases for a year. A further $2 billion has been saved by scrapping a plan for simpler ‘tick and flick’ tax returns, previously promised.
This year, the Treasurer says he’s ‘gone into bat for working families’. The budget has a heavy focus on “cost of living” and “spreading the benefits of the boom”. The mining boom that is. Black gold. Texas Tea… wait, this is Canberra, not Beverly Hills. Shame.
Mums and Dads should be happy with the ‘family’ theme: Child care, family payments, schoolkids … they’re all winners in this budget, courtesy of the mining boom.
- The Family Tax Benefit A from July 2013 will get a boost, giving eligible families up to $600 a year extra (for those receiving the maximum rate with more than one child) [a cost of $1.8 billion]
- A new Supplementary Allowance has been created. The unemployed, students and parents with young children, on income support, may be eligible for a payment of $210, (couples will get $350) starting March 2013 [costs $1.1 billion over four years]
- A new Schoolkids Bonus has been created, giving a lump sum payment of $820 for secondary schools and $410 for primary students, which will be paid automatically to eligible parents (those who receive FTB A), with no need to save receipts or wait for tax time. It will replace the Education Tax Refund and will ensure that parents who haven’t been claiming their entitlements will now get it. [$2.1 billion dollars over 5 years]
- Parents of young children will have more help getting back into the workforce. $225 million over four years has been set aside to help cover the cost of childcare so parents can go to work, look for a job or get extra training.
There are, of course, a couple of stings for some welfare recipients.
- Single unemployed parents will lose their parenting payments when their youngest child turns 8. [saves $685 million]
- If you receive income support or family assistance and want to travel overseas, your payments will be suspended after 6 weeks (reduced from 13 weeks). Students on exchange will still receive their study allowance. [saves $178 million over four years]
- Family Tax Benefit Part A – the maximum age of eligibility has been reduced from 21 to 18, unless the person is in full time secondary study. [saves $360.9 million over 4 years]
The happy story out of this year’s budget is the National Disability Insurance Scheme. Wayne Swan calls it “the most fundamental social policy reform since Medicare.”
One billion dollars has been set aside for the program over the next four years. By July 2013, 10,000 participants will start being assessed for the scheme; that will increase to 20,000 by mid 2014.
$515.3 million for dental health to address immediate dental care needs for low income earners, including $345 million on a “waiting list blitz” to try and get rid of the backlog of people on public dental waiting lists.
$3.7 billion has been dedicated to give older Australians more choice around staying in their own homes as they age, and to making the transition to aged care easier.
There’ll be a tax cut for everyone earning less than $80,000 and from July 2012, the tax free threshold will be tripled which means a million more people won’t have to lodge a tax return.
The Treasurer seemed curiously coy about his big spend on mums and dads. When asked “why the ‘cost of living’ focus?” he spoke about surpluses and global conditions. I suspect it’s because he didn’t like the cheeky second part of the journalist’s question, “are you trying to buy votes?”
So there you have it ladies and gents. Was there anything for you? Does it make you think differently about the government?
And here’s what it looks like in budget lock down.
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Evan Williams is a writer for the daily satirical news bulletin The Roast News Update on ABC2 and The Comedy Channel.
They’ve released a sketch about the budget where one of their reporters tries to explain what EVERY Australian social group thinks of the budget… in 30 seconds.
– Here’s some more details on the carbon tax for those playing along at home. It starts July 1.