How will the Budget affect you?

Wayne Swan has said that the 2011-12 Budget 'will get Australia back in the black, get more people in jobs and spread the opportunities of the mining boom to more Australians.' The Federal Treasurer hopes to achieve these goals by encouraging welfare recipients into the workforce and cutting tax concession and benefits for higher income earners.

On Australia’s economic outlook the Treasurer stated that 'we are moving from a period of short-term softness caused by natural disasters and a patchwork economy to a period of longer-term strength as the mining investment boom gathers pace.' As the economy hits capacity, Mr Swan believes that Australia will need as many people working as possible and stated that 'a wealthy country like ours has no excuse to leave people out of work.'

Opinion is mixed on just how tough this budget is as the Government attempts to rein in spending with the aim of bringing in a surplus by 2013. A minority Government behind in the polls however would be hard pressed to deliver a slash and burn budget and looks to have opted instead for a redistribution of spending priorities and the removal of middle class tax breaks. This redistribution of spending can be highlighted by showing some of the bigger losers and winners of the current Budget:

Less fortunate

• Sick - tougher criteria to get onto the disability support pension
• Defence – to reduce its burden on the budget by $1.6 billion in 2010/11 and $2.7 billion over the next four years
• Families – income tests for Family Tax benefits and Baby Bonus. Family Tax Benefit used to be paid until children turn 24, will now be cut-off when children turn 21
• Public Service – will do more with less as increased efficiencies save $1.1 billion in Government spending.

Those who are better off

• The unemployed - $233 million for skills upgrades and training places to get the long-term unemployed into the work force
• Teachers - schemes to reward top performing teachers costing $425 million
• Mentally ill - an additional $1.5 billion in funding
• Regional areas - $4.3 billion investment into regional hospitals, health care and skilled migrants programs
• Foreign aid – an addition $500 million dollars bringing the total spend to $4.84 billion.