Treasurer Joe Hockey has appealed for all Australians to “contribute and build” in a budget repair effort.
Joe Hockey says the government needs to build a stronger Australia for its children, its seniors, individuals, families, the disabled and frail.
And in his first budget delivered on Tuesday, the Treasurer has ensured they will help pay for that stronger nation.
Older teenagers will find tertiary education more expensive with universities allowed to set their own tuition fees.
Pensioners will see the retirement age increased to 70 by 2035, while pension increases will be slowed by indexing them to inflation instead of wages.
High-income earners on more than $180,000 will pay an additional two per cent income tax for the next three years via a budget deficit levy, while .unemployed individuals under 30 face a six month wait before they can start work for the dole.
Families will see assistance rates frozen for two years, with some family tax benefits capped and limited to families where the youngest child is under six years of age.
Younger Australians on the disability support pension will be required to undertake work experience or some form of employment activity.
And sick people face a $7 co-payment to see a GP, while co-payments for tax-payer funded medicines will increase.
“It is time, for all of us, to contribute and build,” Mr Hockey said.
“We are a nation of lifters, not leaners.”
Under Mr Hockey’s self-assigned budget repair mission, Australia’s forecast gross debt will be reduced over the next decade to $389 billion – some $300 billion less than the $667 billion – a figure contested by the opposition as manufactured – projected for 2024.
The deficit levy is to raise $3.1 billion over its three-year life but deeper, structural savings are to come from changes to social welfare and family payments.
Capping eligibility for Family Tax Benefit B to people on less than $100,000 a year with a child under six will save $3.1 billion over four years, indexing pensions to inflation will save $449 million, and the government expects to save $1.2 billion from its changes to income support for the unemployed.
Mr Hockey defended the apparently light-handed treatment of business, which benefits from a reduction in company tax.
“At the end of the day it’s corporates that employ people,” he said.
For all the slashing of spending and repair work, economic growth is not expected to improve much in the near term.
The jobless rate is expected to stay at or above six per cent for the next three years and still be around 5.8 per cent in 2017, while economic growth is forecast to average 2.5 per cent in 2014/15 and pick up to 3.5 per cent by 2017.