Gutsy budget built around icons

16 May 2013

This is a legacy budget. The further into history it recedes, the better it is going to look in terms of economic management.

From the perspective of community services agencies, it's a budget framed around three icons: a national disability insurance scheme, education reform, and welfare to work focused welfare spending.

The jewel in the crown has to be the Australian Government committing to ten years of funding for DisabilityCare, which once rolled out will make a significant difference in the daily lives of nearly half a million Australians who will be better able to participate in their community.

The budget maintains $3.7 billion for the Living Longer, Living Better aged care package.

It's a gutsy budget in a challenging economic environment and an election year.

UnitingCare advocated for business tax loopholes to be closed, and this budget delivers on that, albeit in a relatively modest way, with savings of $4.1 billion over the forward estimates. I say relatively modest, but that's not the message around Parliament from business representatives. They are not happy.

Another $1.5 billion will be saved through limiting open ended personal income tax concessions related to education and medical expenses.

Some modest steps were taken to rein in middle class welfare, with the baby bonus being scaled back from $5000 to $2000 for the first child and better targeted by being tied to Family Tax Benefit A.

Given that monies saved through these measures are directed to DisabilityCare and education reform in the main, these initiatives are progressively redistributive.

However, the heralded superannuation reform will deliver only $720 million over the forward estimates which annually is less than one per cent, or four dollars in every thousand, of superannuation concession by 2016–17.

For the first time in our nation's history, in the forward estimates super concessions will top $50 billion a year. $50 billion is fifty thousand million dollars. That's a lot of money, 80 per cent of which goes to the wealthiest 20 per cent of superannuants.

It's hard to believe that if we sat down with tens of billions of dollars to allocate to social priorities we would choose to fund the retirement of very wealthy Australians. It's a very poor use of public money.

It is not surprising, but is very disappointing, to see no direct increase to unemployment benefits. While three measures totalling $300 million will assist unemployed people transition to work through lifting and indexing in the tax free threshold, extending the pensioner

AUSTRALIA

Gutsy budget built around icons

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