4 August 2014

Making welfare sustainable

The Government’s Budget recognises the welfare system is unsustainable in its current form.

Welfare changes announced in the Budget focus on supporting those most in need, while creating economic growth and jobs so people don’t need to live their lives on welfare.

Labor left a welfare system that was unsustainable, particularly when the population is ageing.

This Budget takes the decisions needed now to tackle Labor’s debt and deficit disaster. If Australia doesn’t take the hard decisions now, harder and more expensive decisions will be needed down the track.

Australia spends 35 per cent of expenditure on welfare alone - more than we spend on defence, education or health.

Even with the Government’s changes, a low income family will still receive over $12,500 per annum worth of assistance, including the child care benefit, child care rebate and other government assistance (see attached).

Families will also benefit from the abolition of the Carbon Tax, saving households, on average, around $550 this year alone. They will also keep the associated tax cuts - a windfall gain for lower income households.

The Abbott Government was elected to repair the Budget so that future generations would not be burdened with the current generation’s spending.

There’s nothing fair about Labor saddling every Australian with an average $25,000 debt legacy. We are already paying $1 billion each and every month of dead money just to service Labor’s debt, 70 per cent of which heads overseas.

Australians will benefit from bringing the Budget back to within sight of surplus in four years; compared to Labor, who delivered debt and deficits as far as the eye can see.

Attachment

Benefits and Concessions not included in the distributional analysis

  • Child Care Benefit (up to a maximum of $10,250 per year for non-school age child in care for 50 hours a week)
  • Child Care Rebate (up to $7,500 per child p.a)
  • Health Care Card
    • Pharmaceutical Concessions
    • Medicare
    • Private health insurance rebate
  • Job Commitment Bonuses
  • Super co-contribution
  • Relocation Assistance to Take up a Job
  • Transition to Independent Living Allowance (one of payment up to $1500 for young people moving out of home)
  • Trade Support Loans
  • Community Development Employment
  • Projects Participant Supplement (additional supplement for CDEP)
  • Remote Area Allowance

Concessions offered by State and Territory Governments

  • Transport concessions
  • Utility rate concessions
    • Property and water rates
    • Energy bills