Hockey threatens to bypass Senate on Budget

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ScreenHunter_01 May. 06 08.03

By Leith van Onselen

Treasurer Joe Hockey has threatened to bypass the Senate and cut government programs if the Senate continues to blocks the Government’s key Budget savings measures. From The AFR:

“The fact is that there are a number of initiatives that do not need legislation. The biggest savings measure in the budget was the reduction in foreign aid and obviously that does not require legislation now. If the Senate chooses to block savings initiatives, then we need to look at other savings initiatives which may not require legislation,” Mr Hockey told the ABC.

“And I would ask the Greens and the Labor party who between them hold 35 votes in the Senate to understand there are alternatives for the government – we are going to fix the budget, that’s what we promised the Australian people, because we want to create greater prosperity and more jobs for the Australian people.”

The Labor Party is sticking to its guns, however, arguing that “the Budget is fundamentally unfair” and calling on the Coalition to outline what its key savings alternatives are.

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But Treasurer Hockey has hit back calling for Labor to outline its alternative savings, as well as how it intends to restore the Budget to a more sustainable footing.

According to The Guardian, the Budget measures still facing blockage include:

  • The $7 Medicare co-payment and the $5 increase in a co-payment for medicines subsidies by the pharmaceutical benefits scheme.
  • Increasing the indexation in the aged pension to 70 for those born after 1966.
  • Some cuts to family tax benefits.
  • The repeal of personal income tax cuts legislated by the former government but then deferred.
  • Spending “paid for” by the mining tax, including the proposed repeal of the low income superannuation bonus and the low income support bonus.
  • The proposed repeal of the schoolkids bonus.
  • Re-indexation of fuel excise.
  • Denying most job-seekers under 30 unemployment benefits for six months.
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The circus continues…

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.