Budget Night 2009

[weemadando]

I'm sitting here right now just going:

shutupshutupshutupshutupshutupshutupshutupshutupshutupshutupshutupshutupshutupshutupshutup

Wayne Swan is not:
a) Confidence inspiring
b) Making sense

This Budget is going to take a long time to get over for all the wrong reasons.

[weemadando]

*cries*

Why announce a permanent yearly bonus for Carer Payment? Why increase all welfare benefits and especially the Pensions?

We were just getting somewhere with our backlog from the October stimulus packages and now this.

People at work tomorrow are going to be suicidal/homicidal depending on what announcements we get from management about coping strategies.

[Archaic`]

From the little I read on my phone on the bus ride home...how can Swan seriously claim that the Liberals would have given a budget with as bad a deficit as this? Not even including the clusterfuck the two stimulus packages we've already had have been, Swan is once again essentially borrowing money to give to consumers for them to go out and spend more, despite the fact that the root of this entire economic crisis lies in the massive rise in household debt to fund our consumerist lifestyles (which is primarily due to wages being flat and not rising in proportion to productivity in the 1st world since the 70's, but that's another whole kettle of fish). Throwing more money at people to try and stimulate the economy hasn't worked to counter-act any recession or depression in the history of capitalism, and they're already mentioning a potential third stimulus package? Is this some kind of long term political strategy or something, screw future budgets so much by increasing national debt that the Liberals will be forced to increase taxes and cut spending to fulfill their goals of surplus budgets and non-existent debt? Other than the blind pursuit of ideology in the face of an unkind reality, I can't think of any other reason for them to pursue this.

[mr friendly guy]

http://www.abc.net.au/news/stories/2009 ... 568487.htm

Budget 09: Swan puts nation to work

By Online parliamentary correspondent Emma Rodgers

Posted 2 hours 43 minutes ago
Updated 38 minutes ago

Treasurer Wayne Swan is banking on massive investment in infrastructure to keep Australia's economy afloat as he deals with a record $57.6 billion deficit and unprecedented revenue losses.

All single pensioners have got their wish of a $32 a week rise, but by 2023 Australians will have to wait until they are 67 to retire.

Without major surprises, Mr Swan detailed a turnaround in the nation's bottom line of almost $80 billion.

Close to one million Australians are also expected to be jobless by next year as the economy contracts by 0.5 per cent.

At a glance - savings and spending

* $22 billion on roads, rail, ports and clean energy
* A single-aged pension increase of $32.49 a week for singles and $10.14 for couples
* A paid parental leave scheme of 18 weeks at $544 a week
* First home owners grant boost to be extended for another six months, but at a reduced rate after three
* Private health insurance rebate to be means tested for singles earning over $75,000 and couples earning over $150,000
* Family tax benefits to be frozen at current for three years
* $2.7 billion for higher education, research and innovation
* Savings of $22.6 billion over four years

The Government will spend $22 billion on infrastructure projects across the country, including $8.5 billion on roads, rail and ports, $4.6 billion on metropolitan rail projects, $3.4 billion on road networks and $4.5 billion on a clean energy initiative.

Mr Swan says the Budget is focused on combating the global recession's "brutal impact" on growth, employment and Government revenue.

"This is a Budget about nation building for recovery," he said.

Mr Swan says the infrastructure spend will help create jobs now and says the bulk of the funds will be spent in the next two years.

The $8.5 billion will be spent on eight priority projects earmarked by Infrastructure Australia, including the Ipswich Motorway in Queensland, the regional Rail Express in Victoria and the Hunter Expressway in New South Wales.

Another six projects have been listed by Infrastructure Australia for possible funding.

Despite the huge deficit and gloomy economic conditions, the Government has still followed through on its pledge to increase the aged pension, with a $32.49 rise per week for singles and a $10.14 rise for couples, costing $14.2 billion over four years.

The $32.49 rise also applies to those on the carers, disabled and veterans pension.

However for every dollar earned, 50 cents will now be deducted from pension payments, up from 40 cents.

But only half of the first $500 of fortnightly income will be included in the income test.

The Government will also lift the retirement age to 67 progressively every six months from 2017.

Carers will also get a $600-a-year supplement.

The caps on superannuation concessions will also be lowered from $50,000 to $25,000, and from $100,000 to $50 000 for over 50s.

As expected, the Government will also fund an 18-week paid maternity leave scheme from 2011 at $544 a week, at a cost of $731 million over five years.

The Government will extend the first home owners grant scheme boost for six more months, but it will only continue at the full rate until September 30.

From October until December this year the grant will be reduced from $14,000 to $10,500 for established homes, and from $21,000 to $14,000 for newly built homes.

Higher income thresholds for family payments will be paused at current levels for three years until July 2012.

The Private Health Insurance Rebate will be progressively reduced for singles earning above $75,000 and couples earning above $150,000.

Mr Swan has defended the changes.

"Working families have been the recipients of some very significant reforms under this Government," he said.

The already legislated tax cuts will not be changed.

Budget forecasts

* A $210 billion revenue loss over four years, with the 2009-10 writedown expected to top $50 billion
* A 2009-10 deficit of $57.6 billion - 4.9 per cent of GDP, a 2010-11 deficit of $57.1 billion - 4.7 of GDP, a 2011-12 deficit of $44.5 billion and a 2012-13 deficit of $28.2 billion
* Unemployment at 8.25 per cent for 2009-10, 8.5 per cent for 2010-11 and 7.5 per cent for 2011-12
* Growth at -0.5 per cent for 2009-10, 2.25 per cent at 2010-11 and 4.5 per cent in 2011-12 and 2011-13
* Inflation at 1.75 per cent for 2009-10

However, Mr Swan has also defended the Government's spending as "absolutely essential" as the Government faces a $210 billion loss in revenues.

While net Commonwealth debt is forecast at 0.4 per cent of GDP for 2008-09, it is set to peak at 13.6 per cent of GDP in 2012-13 before dropping to 3.7 per cent in 2020.

Mr Swan has set out a path to economic recovery, with the Government hoping to return the Budget to surplus in 2015-16.

The Government will cap real spending growth at 2 per cent of GDP as the economy recovers and will also hold real spending growth below 2 per cent in 2011-12 and 2012-13 when growth is expected to rise above trend.

He also says the savings made now will offset new spending in the final year of forward estimates.

Alright - what will benefit me - tax cuts. Although its not that big a deal for me. What pisses me off more is how the WA state government is cutting my pay by cutting down over time unrealistically expecting us to do more work in less hours (oh, and there will be more work with various health reforms and the "four hour rule"). Fortunately next year my going up a level cancels the pay cut, but it still pisses me off.

What will hurt me
a) private health insurance rebate. The only reason a young and otherwise healthy person like myself is getting private health insurance is because I will get taxed extra to fund medicare unless I take private health. However if the rebate is becoming affected, I may end up paying more. Maybe I can drop the dentistry cover since I never end up using it after the first time.

b) stupid extension of the first home buyers grant boost. Stop trying to save property prices. Let the prices drop as the speculating bubble bursts. This is just going to put us into bigger debt just to appease home owners and investors. Once again those who haven't bothered to save up properly get a fucking big boost. Once again its protecting those who are already rich (because they got into the market at the right time) or those who over committed (and got into the market at the wrong time). Did he ever think about those who were responsible and decided to hold off buying property because of the prices? I guess not as IIRC 2/3 of the population fit into the home owners or investor category.
Ah fuck it. Wait for job losses to hit and see how these people who over extended themselves with multiple properties and dragging up the price like it. They most probably beg for more government assistance. Or blame immigrants.

[mr friendly guy]

more on health funding

Swan takes knife to health rebate

Posted 2 hours 56 minutes ago
Updated 1 hour 44 minutes ago

A record $64 billion in health and hospital funding has been flagged in the Federal Government's 2009-10 Budget, alongside reform that will see the Government grab back savings from high and middle-income earners.

The funding will be rolled out over the next five years and include $1.1 billion to train more doctors, nurses and allied health professionals.

* $64 billion over five years for public hospitals and health,
* $1.5b to upgrade hospitals around Australia,
* Private health insurance rebate to be means tested,
* $2 billion for cancer care infrastructure,
* Medibank Private to become a for-profit Government-owned business.

The Federal Government has also allocated $1.5 billion to upgrade hospitals and clinical training infrastructure across Australia.

However the full amount of this funding will not be rolled out until 2015.

This fund includes hospital development and expansions across all states and the Northern Territory.

A further $1.3 billion will focus on modernising cancer services across the country, including $460 million to build a network of up to 11 regional cancer centres across Australia.

Only $82 million will be rolled out until 2010, followed by $415 million in 2010-11, $336 million 2011-12 and $342 million in 2012-13.

Rebates capped

Meanwhile, the Government will scrap the private health insurance rebate for high income earners and cap the program for some middle-income earners.

Singles who earn $120,001 or more and couples who earn over $240,001 will no longer receive any private health insurance rebate.

The surcharge for these earners who choose not to take out private health insurance will be increased to 1.5 per cent.

Singles earning more than $90,001 and couples earning $180,001 will only receive a rebate of 10 per cent, and the surcharge for avoiding private health insurance will be increased to 1.25 per cent.

Singles earning more than $75,001 and couples earning more than $150,001 will get a rebate of 20 per cent. The surcharge for these earners who choose not to take out private health insurance will remain at 1 per cent.

The Government says capping the rebate will reap savings of $1.9 billion over the next four years.

Treasurer Wayne Swan says the private health insurance rebate is no longer affordable.

"Spending on the private health insurance rebate is growing unsustainably and disproportionately favours those on higher incomes," he said.

However, health authorities have warned that means testing the rebate will force people out of private health insurance and put more pressure on the public health system.

The Government will also cap some services under the Medicare safety net, including IVF treatment, obstetrics, cataract operations and varicose vein treatment.

The Government says it will reduce Medicare rebates for certain services to reflect advances in medical technology, saving the Government $153.4 million over four years.

Closing the gap

Over $200 million will be invested to close the gap in Indigenous health, including $131 million over the next three years for regional services in the Northern Territory.

A $120 million package has also been announced to improve choice and access to maternity services across Australia. This will include a new round-the-clock telephone support hotline for pregnant women and new mothers and families.

Medibank Private is set to become a for-profit Government-owned business under the Government's Budget health reform.

Finance Minister Lindsay Tanner says the conversion will allow Medibank Private to compete with other players in the private health insurance market.

"This is an important change as it will ensure competitive neutrality in the private health insurance industry," he said.

"For the first time, Medibank Private will pay tax on profits and return dividends to the Government."

I can agree with more hospital funding, but I bet you the Eastern states are going to get the lion's share.

I also agree with improving Aboriginal health. That has a been poor to say the least, and hopefully if this can be addressed some good can come of it.

Looks like I might be given only 10% instead of the 30% rebate. That sucks as I am saving up and hoping to buy a house. And to top it off the government's idea of extending first home buyer's boost just made it more difficult.

And I bet you of that money into hospitals, the state government won't use much of it to pay their staff. I have already ranted about how they use every opportunity they get to under pay staff blatantly making rules up as they go along to interpret a signed contract.

I can't say I am too thrilled with this budget.

[weemadando]

The Age pension age reforms are too little too late. The retirement age needs to go to 70, if not 75. And quicksmart.

The best indication of why Australia needs welfare reform. This is for this budget. That's almost 1:1 for individual tax dollars:welfare payments. Just wait until the boomer retirement frenzy hits. From Budget 2009.

[bobalot]

I don't get why people are whining about the budget going into deficit. That's exactly what is supposed to happen in bad times.

Projected revenue for the government has fallen by nearly 210 billion dollars over the next years (Source). Unless you want to slash spending and further deepen any recession, the budget has to go into deficit. No matter who is in power, the budget would have gone into deficit. Surplusses in good times and deficits in bad times.

Overall, the budget is not too bad. They should have clawed back on more middle class welfare. A real source of irritation for me was the extension of the first homebuyers grant.

Abolish the baby bonus, first home buyers grant, 30% for private health insurance, and the myriad of other middle class handouts. The huge hand outs to private schools should have gotten a real grilling, but that's too much of a political hot potato.

The 25 billion flagged for infrastructure is a good idea. They should have shelved the tax cuts and poured it all into infrastructure. However, that would have been political suicide. We should have really been investing in infrastructure and education during the good times, but John Howard (The ex PM) used the surpluses for inflationary tax cuts and pork barreling.

[Archaic`]

I don't get why people are whining about the budget going into deficit. That's exactly what is supposed to happen in bad times.

The problem isn't that it's in deficit, it's the degree to which it's in deficit, and the reasons for it being so badly in deficit. The money should be going to grand infrastructure projects on the scope of the Snowy Mountains Scheme (Nuclear Power Plants would be a good start), not to pork barrel welfare payments masquerading as stimulus packages. The 2nd stimulus package was $42 billion or so on its own. Sadly, the Rudd government's idea of infrastructure spending seems to be giving money to local councils to fix potholes.

[bobalot]

I don't get why people are whining about the budget going into deficit. That's exactly what is supposed to happen in bad times.

The problem isn't that it's in deficit, it's the degree to which it's in deficit, and the reasons for it being so badly in deficit. The money should be going to grand infrastructure projects on the scope of the Snowy Mountains Scheme (Nuclear Power Plants would be a good start), not to pork barrel welfare payments masquerading as stimulus packages. The 2nd stimulus package was $42 billion or so on its own. Sadly, the Rudd government's idea of infrastructure spending seems to be giving money to local councils to fix potholes.

The deficit is 56 billion out of a revenue stream of 290.6 billion. A debt of about 19% of their income stream. It is hardly anything compared to America, many countries in Europe or even Japan. The average gearing ratio for a non-financial company in Australia sits at about 65%. (Source).

This is why the AAA rating of Australia is not in any way threatened. The size of the deficit for a modern industrial country with huge mineral reserves is peanuts. When the world economy picks up in some time, the increased revenue will result in huge surpluses that will be used to pay off the deficits (which is exactly what happened last time we had a huge deficit.)

I agree that we should be doing major infrastructure projects. However, they aren't just doing odd council jobs like you said. Literally billions is being spent on ports, roads and rail.

Let's face it, today's generation of Australians are generally wusses who aren't willing to spend money or sacrifice anything in the way of nation building. We have gotten this strange mentality that all sorts of infrastructure can be built without anybody paying for it. We aren't prepared to think decades ahead and plan. If we had this sort of attitude 60-100 years ago, the harbor bridge, the rail systems, road systems, sewerage systems, power systems and the telecommunications system of Australia either wouldn't have been built or would be in a shambles.

Most of these systems didn't make a profit (Or never have) for decades, but people back then had the foresight to know the infrastructure was needed to build a nation and make the economy more efficient. I know for a fact, on average most of the passenger rail systems have never made a profit over the last 100 years. They are essential parts of the state economies, but are basically unprofitable entities. Imagine proposing building something like that in today's political climate.

Today we prefer handouts and pork barreling rather than visionary infrastructure building. Anybody who would propose anything remotely big would be pilloried by the media for wasting taxpayers money. Economists would point out that the infrastructure would be unprofitable for decades, and the opposition would promise to cancel the project and deliver the cash in tax cuts. The government would be ejected out by next election.

[Archaic`]

The deficit is 56 billion out of a revenue stream of 290.6 billion. A debt of about 19% of their income stream. It is hardly anything compared to America, many countries in Europe or even Japan. The average gearing ratio for a non-financial company in Australia sits at about 65%. (Source).

Conveniently ignoring the fact that this is the largest amount of debt Australia's government has ever had, and it's not being built up over time, but instead is coming directly from one single budget.

This is why the AAA rating of Australia is not in any way threatened. The size of the deficit for a modern industrial country with huge mineral reserves is peanuts. When the world economy picks up in some time, the increased revenue will result in huge surpluses that will be used to pay off the deficits (which is exactly what happened last time we had a huge deficit.)

And where's the evidence to assume that the world economy will pick up? It certainly won't happen quickly, and Rudd seems determined to run deficit budgets every year this depression continues. History lesson for you. The only reason we got out of the Great Depression was World War II. If that hadn't happened, the Great Depression would have continued a lot longer. It's time for governments to face facts and admit to themselves what the academics already figured out long ago. We're in the midst of the greatest economic crisis Capitalism has ever faced, and it's not going to be "over by Christmas".

I agree that we should be doing major infrastructure projects. However, they aren't just doing odd council jobs like you said. Literally billions is being spent on ports, roads and rail.

I would not call repairs, maintenance and relatively minor upgrades to be major infrastructure projects. The sad fact of the matter is that there's no point in improving transport infrastructure if they're trying to stimulate the economy in the short to middle term. Demand is dropping, less goods need to be transported, and increasing the carrying capacity and efficiency of transport systems will only result in that extra capacity not being used.

Let's face it, today's generation of Australians are generally wusses who aren't willing to spend money or sacrifice anything in the way of nation building. We have gotten this strange mentality that all sorts of infrastructure can be built without anybody paying for it. We aren't prepared to think decades ahead and plan. If we had this sort of attitude 60-100 years ago, the harbor bridge, the rail systems, road systems, sewerage systems, power systems and the telecommunications system of Australia either wouldn't have been built or would be in a shambles.

Most of these systems didn't make a profit (Or never have) for decades, but people back then had the foresight to know the infrastructure was needed to build a nation and make the economy more efficient. I know for a fact, on average most of the passenger rail systems have never made a profit over the last 100 years. They are essential parts of the state economies, but are basically unprofitable entities. Imagine proposing building something like that in today's political climate.

Today we prefer handouts and pork barreling rather than visionary infrastructure building. Anybody who would propose anything remotely big would be pilloried by the media for wasting taxpayers money. Economists would point out that the infrastructure would be unprofitable for decades, and the opposition would promise to cancel the project and deliver the cash in tax cuts. The government would be ejected out by next election.

You could probably generalize that to most 1st world nations, sadly. I don't know if you can lay the blame for it on the consumerist culture that's been steadily growing since the 1970's, but the average person really does seem to have lost the ability to make any sort of long term planning whatsoever. They'd rather have a bird in hand today than two in the bush tomorrow.

[bobalot]

Conveniently ignoring the fact that this is the largest amount of debt Australia's government has ever had, and it's not being built up over time, but instead is coming directly from one single budget.

Wrong, we got up to $96 billion in the last recession. So what if it is in one budget? Like I pointed out before, the and gearing and debt to GDP ratio is relatively small compared to other countries. Once we get up to 60% or 70%, then we should start worrying.

And where's the evidence to assume that the world economy will pick up? It certainly won't happen quickly, and Rudd seems determined to run deficit budgets every year this depression continues. History lesson for you. The only reason we got out of the Great Depression was World War II. If that hadn't happened, the Great Depression would have continued a lot longer. It's time for governments to face facts and admit to themselves what the academics already figured out long ago. We're in the midst of the greatest economic crisis Capitalism has ever faced, and it's not going to be "over by Christmas".

I never said it would happen quickly but eventually it will. China is still growing and requires our minerals we are not as screwed as the US or the UK. As for the great depression most countries that had left he gold standard were well on the way to recovery before world war II. The United States recovery began in 1933 after it left the gold standard.

I would not call repairs, maintenance and relatively minor upgrades to be major infrastructure projects. The sad fact of the matter is that there's no point in improving transport infrastructure if they're trying to stimulate the economy in the short to middle term. Demand is dropping, less goods need to be transported, and increasing the carrying capacity and efficiency of transport systems will only result in that extra capacity not being used.

I work on the railways. While the NSW government fucked up and made sure we didn't get any cash for rail projects by perusing it's fucking ridiculous metro, there are huge rail infrastructure projects being built by the feds. Billions of dollars being spent on intrastate freight and ports. It is not simple maintenance and repairs. During the previous years, there were huge bottlenecks in rail and the ports due to lack of investment which was costing Australia billions in delays and lost efficiency. It's a good idea to have the infrastructure in place when the economy does eventually pick up.

In fact its the best time for government to do such projects. It can get better prices for materials and labor (due to depressed demand and weak labor markets) and stimulate the economy via spending.