Whilst Joe Hockey has attempted to replace the age of entitlement “not with an age of austerity, but with an age of opportunity,” by taking extreme fiscal measures, the government have focused the 2014-15 Budget on pulling the economy out of deficit in the future, they have not looked at how the Budget is affecting people at this present moment. As a result, Joe Hockey has failed to show fairness in this years’ budget.
Current State of the Economy
Where did the Labor Government leave Australia’s Economy?
The Labor Government have had a major impact on the Australian Economy, which has made it quite difficult for the Coalition to inherit. Joe Hockey stated that “Sixteen years of deficits without a recession, without any significant…show more content… Over the four years from 2009-10 to 2012-2013, Labor had met its fiscal rule of keeping the average spending growth rate to less than 2% a year (Musgrave, R. A. n.d). This was the lowest period of spending growth in 23 years, meaning that not enough money was being injected into the circular flow of income. This reduced aggregate demand as consumer spending was low. In order to ensure that key spending was sustainable, structural improvements were required for the 2014-15 Budget. Overall, the Labor government has left a disastrous legacy of high debt for the Liberal government to try and overcome.
2014-15 Budget Allocation Resources Revenue Expenditure
Education • Gonski Education funding reforms to be unwound, saving the commonwealth up to $30 billion
• University students to repay HELP loans earlier • Subsidies extended to private institutions, given the ability to set their own fees
• Funding commitments are honored
Health • Rudd-era hospital funding deal with states to be unwound, saving the commonwealth up to $50 billion
• Patients will pay a fee of $7 for every GP visit- capped at 10 payments a year for children and concession-card holders.
• $5 of the fee will fund a new medical research fund that will grow to $20 billion
• Medicare safety net will be cut for most people • No expenditure
Welfare • Family Tax Benefit Part B means-tested at $100 000 and removed once children turn six
• Under 30’s will have to wait six months