Australian Budget for 2006-2007 released

Tuesday, May 9, 2006  The Australian Budget (Appropriation Bill No. 1) for 2006-2007 was released by the Australian Liberal Party-Australian National Party coalition government treasurer, Peter Costello (Higgins, Liberal).

Costello noted the resilience of the economy against natural disasters and terrorism, and through "disciplined and prudent management" the Government was able to "repay Labor's debt" of quoted 96 billion dollars of net debt and the Government was now "debt-free".

Costello noted that the Government budget was in "surplus for the ninth time" with a forecast surplus of 10.8 billion.

Infrastructure

Costello announced "new investment in physical infrastructure and research infrastructure". The AusLink program is to receive an additional 2.3 billion, an "increase of nearly 20 percent", and noted that the Budget would allocate "800 million to accelerate duplication of...the Hume Highway", and "270 million dollars to RailTrack" in the development of the north-south rail corridor.

Costello noted the Government's commitment to the health of the Murray River system by a "new injection of 500 millions to the Murray-Darling basin commission" for a "range of capital works and improvements".

Costello also announced funding for health and medical research, noting an increase in funding for the NHMRC to a base funding of 700 million dollars a year, a "fivefold increase", sixty-five additional fellowships for researchers, and 235 million dollars for "physical infrastructure".

Tax reform

Costello announced in regard to tax reform a "new comprehensive tax reform plan" "another installment in income tax reform", a "major improvement in business tax" and a "plan to simplify and streamline superannuation" "most significant change in nearly 20 years"

Costello remarked that if one could reduce the tax burden, one "should aim to do so", and thus announced he would "reduce marginal tax rates" at the other end of income tax scale, and would increase tax-free thresholds.

On superannuation reform, Costello proposed to "sweep away the current raft of complexity" and "increase retirement incomes". The core of the plan is the "proposal to exempt Australians age 60 or over from any tax" on particular superannuation arrangements.

Assistance to families

Costello announced changes in family assistance payments. The Family Tax Benefit payment is now available to those earning under AUD$40,000. The limit on the number of subsidised after school hour places would be removed.

Furthermore, Costello noted that "an additional 1000 to be paid this financial year to over 1000 people eligible for the carer payment".

Defence

Costello announced that 10.7 billion dollars would be allocated to the Australian Defence Force, and announced 2.2 billion would be spent to acquire C-17 heavy lift aircraft.

On intelligence, Costello announced an increase ASIO staffing to 1800 and improvements to its technical capabilities, and a further 125 million to enable increased operations for ASIO.

Costello also said that 389 million dollars would be allocated over four years to combat illegal fishing.

Conclusions

Costello concluded by forecasting that Australia's economy would grow to a "trillion dollar economy" and that the Budget would "build opportunities for the future".

Processing of accompanying bills then begun by Parliament.

The Federal Australian Labor Party Opposition will have a right-of-reply tomorrow.

Sources

• ABC NewsRadio broadcasts of Parliament, May 9, 2006.
• Australian House of Representatives Hansard, May 9, 2006.