The backdrop for Wayne Swan’s Budget press conference said it all: Rail>Roads>Ports>Jobs.
This is being pitched as a nation-building budget, “Nation Building for Recovery”. To fund it, the Government is using virtually all of its Building Australia, Health and Education funds built up during the Howard Government era of surpluses and its own salting away of funds last year.
The infrastructure package, drawn from Infrastructure Australia’s assessment process, has a strong rail emphasis, with $4.5b directed to rail passenger services, mainly in metropolitan areas. This marks the entry of a Commonwealth Government into urban mass transit, and not before time. There’s another $3.5b for roads and $400m for ports, but the big loser in the allocation is NSW. Sydney’s West Metro will get $91m, and the Kempsey Bypass and Hunter Expressway will get just over $2.1b, but that’s it for the Rees Government.
The Government has also plunged $2b on Carbon Capture and Storage technology, aiming to develop flagship projects. To counter accusations that it is failing to back renewables, there will also be a similar $1.5b fund for solar energy projects, and a new bureaucracy, “Renewables Australia”, to spend another $465m. About $3.5b of that $4.5b will be new money.
The big ticket item is a $32.49 a week rise in the single pension rate and a $10.14 rise for couples, along with $1200 per annum lump sum for carers ($600 per carer, and $600 for each person in their care), which will cost nearly $16b over four years and keep costing $4b+ year in, year out. As a partial offset, the Government has made a long overdue commitment to lift the retirement age, which will increase by six months every two years from 2017, until it reaches 67. This represents the first change in the male retirement age for a century and is more or less the biggest reform item in the whole Budget.
The Government has also responded to the Bradley Report on higher education, punting a billion dollars into improving university capacity and infrastructure and directing more funding to student income support, a move that will receive little attention but which should be applauded.
Probably the big absence in expenditure is any move to increase Newstart benefits; the Government is sticking to its commitment to address unemployment through training, more young people in education and job creation.
All up, an extra $13b in spending (including old money) in a budget supposedly about every Australian doing their bit.