Posted on 05/11/2005 3:28:53 AM PDT by Aussie Dasher
LABOR today signalled it will block the Government's $21.7 billion tax cuts as Prime Minister John Howard failed to give an iron-clad guarantee that all measures outlined in the Budget would be delivered.
About $21.7 billion in tax cuts and a $3.6 billion move to push 190,000 people from welfare to work were the centrepieces of Treasurer Peter Costello's 10th budget handed down last night. (Tax cuts: Full story) Mr Costello and Mr Howard hit the airwaves to sell the main points today, both keen to focus on the Budget and not the leadership stoush between them.
Asked whether the measures in the Budget were iron-clad, Mr Howard told Southern Cross radio: "Well we don't intend to change it, but in any government something totally unforeseen could come along and affect any government, I can't make myself a hostage to that."
"But on all the available evidence this is a conservatively cast Budget," he said.
"I'll say that I have every intention of seeing this budget fully implemented, and I might remind you on that score, that subject to the change in relation to the Medicare safety net threshold, we have fully funded and implemented all of our election commitments."
Opposition Leader Kim Beazley today signalled taxpayers would have to wait for their tax cuts, committing Labor to blocking the proposals.
But Labor can only do so until July, when the Government takes control of the Senate.
Mr Beazley said single mums who failed to find part-time work would have their welfare payments cut as much as the nation's rich gained in terms of tax cuts.(Mums forced to work: Full story)
"We're going to vote against it, and we're going to invite the Government to go away and re-do the tax package so it's fair on middle Australia," he told ABC radio.
"It's not fair on middle Australia as it stands at the moment, where people on average weekly earnings get a $6 a week tax cut and the upper-income folk get 10 times that amount."
Mr Costello said the tax cuts would be an important incentive for people on middle incomes because they would no longer face losing any overtime or extra payments in higher tax.
"I think for middle-income earners, what it says to them (is) you will not have to fact the top marginal tax rate in Australia.
"You will not have to face it until you're on about three times average weekly earnings."
Mr Howard said the welfare changes, which aim at getting 190,000 single mothers and people on disability support pensions into work, were not a form of punishment. (New tests for disabled: Full story)
"It's overwhelmingly in the interests of a sole parent (to have) a single mother, once their youngest child has gone to school, to be in a part-time job," he told the Seven network.
"They're better off financially, from a social point of view, from a career development point of view (and) from a personal satisfaction point of view.
"We see this as helping people to better their lives."
Both Mr Costello and Mr Howard rejected suggestions the tax cuts would be eaten up with higher interest rates.
"I don't believe for a moment that this is going to be inflationary, I really don't," Mr Howard said.
The two fended off questions over leadership, but backbench Howard supporter Peter Lindsay heaped praise on Mr Costello, saying he had delivered his best Budget. (Analysis: Treasurer's bid to be loved)
"Last night Australia paid off the debt of current Australians and provided to look after the debt of future Australians," he said.
"The underlying fantastic proposition that we have secured the future is what's important for this country."
But Australian Council of Social Services president Andrew McCallum said it was clear the Government had a fixation with tax cuts and little focus on investment in services such as public hospitals.
"We don't mind returning bracket creep occasionally but we seem to have a tax preoccupation with tax cuts that goes disproportionately to the top end," he said.
Makes sense. The last person you want to work for is someone who can afford to pay you.
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