Labor begins attack on ‘hoax’ budget, slams cuts to pensioners

Federal Shadow Treasurer Chris Bowen has come out swinging against the government’s 2018 Budget announcement, calling cuts to pensioners “cruel” and “cynical”.

Federal Treasurer Scott Morrison announced new budget measures on Tuesday night, and while he followed through on promises allow retirees to earn more cash while still claiming the Age Pension, he also revealed plans to scrap the energy supplement for pensioners and Newstart recipients.

Bowen told ABC’s Linda Mottram he was outraged the government hadn’t done more to help older Australians, especially after its criticism over Labor’s plan to undercut refunds on imputation credits for those drawing an income from their superannuation. 

“The government hasn’t learned lessons from the last five years on pension measures and tax cuts for big business,” Bowen said.

“This is a government that has the best economic circumstances in a decade and yet we’re still only getting waiver thin surplices. Gross debt will remain greater than half a trillion every year for the next decade, so there’s plenty for people to be concerned about.”

He also rubbished new funding measures for the aged care sector, including the $1.6 billion over four years that will allow 14,000 people to receive care in their homes rather than nursing homes.

“There’s not one new dollar for the aged care sector,” Bowen said. “This is all a reprioritising of exisiting money. Now I think this is cynical, it’s a hoax and it’s cruel. They’ve taken the money from elsewhere in aged care. Now we’ll need to find out exactly where because that’s not clear in the Budget papers, but aged care is no better off as a result of this budget.

“I’m absolutely outraged. This is taken a cyclical approach to aged care and misleading people.”

Opposition leader Bill Shorten will issue his official Budget reply on Thursday night, but Bowen indicated Labor will support some of the government’s tax cuts for low-income earners.

The government announced a range of tax savings for workers to be rolled out between July 1, 2018 and 2222. However, Labor is expected to only vote in favour of those that kick off from this year as the government “hasn’t shown” where the money is coming from.

The Budget has received mixed reviews so far. Low-impact cuts across the board, tax benefits for low-income earners, and a promise of a return to surplus by the early to mid-2020s, all point towards an election budget aimed at boosting the government’s standing in the polls before voters make their decision.

In his speech on Tuesday night, Morrison said the government was giving simply taxpayers the money they deserved.

“This is not spending or a giveaway,” he said. “We are simply enabling Australians to keep more of what they have earned.”

While pensioners will lose out on the energy supplement in new savings measures, they were awarded with a series of changes designed to increase retirement incomes.

If Labor agrees to the government’s plan, pensioners will able to earn up to $300 a fortnight – $50 more than the current earnings cap on the Pension Work Bonus – without seeing their pension payments cut. And the work bonus scheme will be extended for the first time to self-employed people, in the hope of encouraging older Australians to start their own businesses.

That means a potential $1,300 annual income boost to pensioners who take full advantage of the work allowance.

The government will also relax the Superannuation Work Test, to allow more people to increase their super balance even if they don’t fulfil the requirements of the current test.

Under the current rules, people aged between 65 and 74 can continue to make super contributions as long as they work for at least 40 hours in a period of 30 consecutive days in the financial year. But the relaxed test will allow people whose super balance is under $300,000 to make contributions in a single year even if they don’t meet the work test requirements in that year.

What are your thoughts on the budget? Does it sound fair to you? What do you hope to see in Bill Shorten’s reply?

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