Budget 2014

Dr John Hewson on ABC TV – The Drum

The Budget – Simon Benson

TREASURER Joe Hockey has vowed to future-proof Australia’s prosperity, with dramatic cuts to welfare spending to create the ­largest medical research fund in the world as an ­insurance policy against the cost of paying for the ­nation’s ageing population.

Bludgers would be put to work, family payments cut and welfare concessions means tested or axed in an effort to repair the budget damage Mr Hockey has blamed on six years of Labor government.

However, Mr Hockey has revealed, in one of the few surprises in what was billed a document of spending cut horrors, that much of the pain would go towards creating a $20 billion medical research endowment fund which would one day dwarf the Bill Gates Foundation.

The Coalition’s first Budget, handed down yesterday confirmed a $7 Medicare ­co-payment to be introduced for GP visits, effectively ending Australia’s universal free healthcare system, would be redirected to this medical ­research fund.

Video – Terry McCrann – click his image below

Business commentator Terry McCrann says Joe Hockey’s serious cuts will see him eventually balance the Budget’s bottom line

“If we all contribute now we will build the biggest medical research endowment fund in the world within just six years, a fund that will underpin the health system,” Mr Hockey said.

Mr Hockey’s “human ­infrastructure investment’’, as he described it, was pitched as the second element of a growth drive which included a $39 billion capital infrastructure program which he hoped would generate $125 billion in future investment.

The Treasurer admitted to The Daily Telegraph he could not go as hard in the Budget as he would have liked for fear of having a negative impact on the economy.

He said he had also been “straightjacketed” by the Prime Minister’s election promises, with much of the pain to come in later years and after the next election.

High income earners will be hit with a 2 per cent levy on salaries over $180,000 which would kick in from July 1 this year and last for three years. Families will also be struck, with the first phase of a winding back of the family payments system which would save $380 million off the budget in the first year but dramatically scale up to save more than $4.5 billion a year by 2017-18.

Joe Hockey’s Budget means working families are protected from the biggest hip-pocket hits

The overall savings booked over the next four years will total $36 billion. Foreign aid will also be cut by $8 billion and industry assistance cut by almost $1 billion.

The Treasurer declared the age of entitlement over, with indexing arrangements slashed for pensions and the disability support pension.

Instead of being tied to the average male wage, they would be linked to CPI; but not until 2016-17.

Seniors card and concessional card entitlements would also be scaled back.

“We must always remember that, when one person ­receives an entitlement from the government, it comes out of the pocket of another Australian,” Mr Hockey said.

“These changes will build a more sustainable welfare system, with more household income coming from personal effort rather than the government.”

He conceded some would accuse the government of breaking promises, namely the lift in fuel excise to pay for infrastructure and the debt levy. But the Budget was not without its sweeteners.

Low income earners who lose some of their family tax payments will be protected with a special $750 payment and a new loans system will be created to help young people seeking a trade by providing a $20,000 HECS style loan. Shadow Treasurer Chris Bowen last night said the budget was “built on the wrong choices and wrong promises for Australia’s ­future”, accusing Tony Abbott of “mass deceit’’ at the last election.




Words source: Simon Benson article, Daily Telegraph 14 May 2014