Labor budget for big business

Vanguard June 2013 p. 2
Jim H.

The core of the Federal Budget delivered by Labor premier Wayne Swan is spending cuts on social programs and increased taxes on the people.

There is an obsession with achieving a large budget surplus by 2015/16 and a $6.6 billion surplus in the following year. A cut of $43 billion has been earmarked for the next four years to bring the budget into surplus.

Spelled out in Swan’s pronouncement is the Labor government’s ongoing commitment to big business. Above  all else, the budget aims to continue the  diversion of national income away from the majority and into the pockets of the small minority of corporate interests.

These interests have been behind the push for massive spending cuts and achieving a surplus  so as to further minimise the corporate sector’s taxation requirements.  It is no surprise that such demands are made in conditions of deepening economic crisis.

As the biggest corporations are overwhelmingly American in origin, the direction pursued by Labor locks us more firmly into the orbit of US imperialism. Australia’s severely curtailed sovereignty  is further reduced.

Labor seeks to do  this in the name of the very people it is betraying – working class Australians.  This year’s budget is more important for what it aims at, than for the scope of the immediate cuts. It does not make it any less important, when  considered in the longer term perspective.

Given  the direction it is taking, Labor  almost guarantees its own  parliamentary defeat. It also prepares the ground for even worse under the Coalition. They will simply build on Labor’s approach to intensify the burdens placed on the people.

Key budget measures

Quite a bit of noise has been made about helping empty nest older Australians to downsize their homes. This is all very good, but the reality is that the $12.4 million housing incentive is so restrictive in the fine print that not many will be able to take it up. Exemptions from tax on property sales stop at $200,000 and the owner must have lived in the property for at least 25 years. There is more smoke and mirrors here than substance.

New expenditure on the health system will be minimal. Some Medicare-subsidised items are to be reviewed however. There is some extra funding for disability services. That is positive. Overall health expenditure remains far short of what is required to overcome the many shortfalls of the existing, underfunded system.

There is some new funding for schools. While there is some top up for disadvantaged students, the proposed funding arrangements ensure that the elite private schools retain their privileged positions. Australia is unique among the OECD countries in using government funds to pay for private education.  It is a nonsense, and the new funding arrangement, if adopted, continues to enshrine it. Instead of hitting mining and the banking sector with realistic levels of taxation, Labor takes funds from universities to pay for school funding!

A billion dollars is to go from renewable energy and environmental programs.

Permanent jobs in the Department of Human Services will be slashed by 2400 and replaced by casual and  part-time workers.  As a result, the range of Centrelink, welfare and child protection services will be compromised.

Farmers will be hurt with the minimal $99.4 million Farm Household Allowance to support farmers in hardship under National Drought Program Reform program. But this funded by cuts to the Caring for our Country program. Natural resource management and the expansion of sustainable farming are inevitably weakened.

Some cuts to tax offsets that affect ordinary people will be scrapped, such as the medical expenses tax offset, which will only remain available for taxpayers for out of pocket medical expenses relating to disability aids, attendant care or aged care expenses.

The Government is also restricting work-related self-education expense deductions, putting an annual $2000 cap on these expenses from 1 July, 2014.

This is the gist of this year’s Federal budget.

  

The problem is that under capitalism, we will have a government of big business, regardless of whether it wears the Labor or Coalition colours. A government of big business is not prepared to and cannot do other than what we are seeing at present. The Australian people have good reason to demand differently and work to force through whatever concessions they can.

Ultimately they must put to rest all such governments by imposing their own political power to achieve anti-imperialist independence and socialism.

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Further reading:

http://www.probonoaustralia.com.au/news/2013/05/budget-gaping-hole-poorest-remains#