Prime Minister Julia Gillard tipped to announce big spending cut
By Malcolm Farr, National Political Editor
January 30, 201312:00AM
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The Gillard Government is hunting for money to cover extra education funding. Picture: Kym Smith Source: The Daily Telegraph
The Gillard Government is hunting for money to cover extra education funding. Source: Herald Sun
THE Government will soon pre-empt its May Budget by announcing a significant, single cut in spending which could see reductions in welfare payments or industry support.
Prime Minister Julia Gillard today will foreshadow the cuts and commit the savings to “key Labor priorities”.
The Government, hit by shrinking revenue, is hunting for money to cover extra education funding and pay for further steps in creation of its National Disability Insurance Scheme.
“This year we will make the tough, necessary decisions to ensure our medium-term fiscal strategy is delivered, and our centrepiece plans for Australian children and Australians with disability are funded, in this new low-revenue environment,” Ms Gillard is expected to tell the National Press Club.
She also will pledge to combat job insecurity, particularly in the manufacturing sector where hundreds of workers have been retrenched as the high Australian dollar makes our exports expensive.
And Ms Gillard will also confirm that in April she offer premiers more money for education in return for higher quality teaching and learning, new powers for principals, and new transparency on results.
The Prime Minister and Opposition Leader Tony Abbott will be making their first NPC addresses for the year this week with both hoping to set the issues and tone of the election campaign expected late in the year.
Ms Gillard will match Mr Abbott’s “five pillar economy”, announced at the weekend, with five of her own. She believes that while the Government can’t direct rein in the Australian dollar, it could improve the prospects of local industry by improving competitiveness and economic diversity.
“So we can and must focus on increasing skills, building a national culture of innovation, rolling out the national broadband network, investing in infrastructure, improving regulation and leveraging our proximity to and knowledge of a rising Asia into a competitive advantage,” her speech is expected to say.
The Government will release its Industry and Innovation Statement and respond to a taskforce report on manufacturing as part of its bid to make jobs more secure.
Ms Gillard said policies would involve “backing Australian firms to win work at home, win business abroad, and create new jobs and growth, above all through co-operative innovation, through firms and employees, researchers and governments all working smarter together”.
Her speech will outline “substantial new structural savings that will maintain the sustainability of the Budget and make room for key Labor priorities”.
“Our record of cutting wasteful programs, in line with our Labor values and purpose, is already strong,” she is expected to say.
“The dependent spouse tax offset, the tax breaks for golden handshakes, tax concessions on super for high income earners, the millionaires dental scheme and fringe benefits loopholes for executives living away from home … all gone.
“The private health insurance rebate is means-tested: something many said could never be achieved.
“This year we will make the tough, necessary decisions to ensure our medium-term fiscal strategy is delivered, and our centrepiece plans for Australian children and Australians with disability are funded, in this new low-revenue environment.”
The Opposition wants the Prime Minister to provide more detail on the economy.
Shadow treasurer Joe Hockey said Ms Gillard should use the speech to “reveal the true state of the Budget” following the Government’s retreat from guaranteeing a surplus for 2011-12.
And Mr Hockey suggested some questions to be put to the Prime Minister:
Will the Prime Minister explain to the Australian people how she intends to keep her promise of paying off net debt by 2020-2021 given that would require surpluses of almost $30 billion a year from 2016-2017?
How can (Treasurer) Wayne Swan and Julia Gillard claim to be lower taxing than the Howard Government when they have announced 27 new or increased taxes and when their total call on the community including taxes, borrowings and dividends – is the highest in recent times?
How can Wayne Swan and Julia Gillard talk about a decline in Government revenue when this year they are estimated to receive over $70 billion more revenue than the last Budget of the Howard Government?
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