Audit wants sweeping financial change
Audit wants sweeping financial change

Vast swathes of the Federal Government would be out-sourced, States given the power to raise their own income taxes and welfare slashed to ordinary families under a radical plan unveiled by the Abbott Government’s Commission of Audit.

In a 900-page report with more than 250 recommendations, the Commission argues that without difficult decisions now, future generations will face either greatly higher taxes or dramatically reduced services.

COMMENT - REPORT ENOUGH TO FRIGHTEN ANY GOVERNMENT PLANS UNPOPULAR: HOCKEY

Key Recommendations

Reduce rate at which age pension is increased | Include family home in age pension asset test | Allow States to impose their own income tax | Abolish Family Tax Benefit B | Cut threshold to abolish a new single Family Tax Benefit | Reduce the rate of increase in minimum wage | Force young unemployed to move after 12 months on Newstart | Reduce planned Federal funding for hospitals | Toughen access to carers’ allowance | Force university students to pay more of their tuition, and at a faster rate


Amongst its most dramatic recommendations, the Commission recommends a $15 co-payment for any medical visit, including the family home in the age pension test, a cut in the minimum wage and an effective $300 a fortnight reduction in the age pension.

Some families would be up to $8000 a year worse off under a string of changes linked to family tax benefits including the abolition of Family Tax Benefit B.

The age pension access age would increase and be linked to expected improvements in longevity. The Commission estimates the age pension access age would reach 70 by around 2053.

States would be given their own share of Federal income tax that would be necessary to fund the new responsibilities they would inherit from Canberra.

The running and funding of schools would go back to the States while they would also have more responsibility for the health service.

States would be encouraged to look at imposing their own co-payment on people who turn up to a hospital emergency ward with a “non-urgent” condition.

The Pharmaceutical Benefits Scheme would be revamped with the sick facing higher charges to get necessary drugs.

Road users would face higher charges to drive with the Commission canvassing surcharges for driving at particular times, such as during the morning and afternoon peak.

In a challenge to the Government, it says a plan to lift Defence spending to 2 per cent of GDP should be re-visited. It also backs lifting the age at which a person can access their superannuation by five years to 65.

Australians in trouble overseas would be charged to get help from an embassy.

A raft of public authorities would be sold including Australia Post, Defence Housing Australia, the Royal Mint and eventually the NBN.

Other entities would be abolished, including the Clean Energy Finance Corporation while others such as the Family Court, the National Competition Council and Cancer Australia would be merged with other departments.

Even the corporate watchdog, the Australian Securities and Investment Corporation, would be ditched completely or merged with another organisation.

Commission chairman Tony Shepherd said without cuts now, the Budget would be in deficit for 16 consecutive years.

He said the biggest spending programs had to be brought under control.

“The Commission recognises the unfairness of saddling today’s children with our debts,” he said.

“With an ageing population there will be fewer people of working age to look after the retired. They should not inherit our debt as well as the burden of looking after us.”

The Commission backs one of the Barnett Government’s constant complaints about the annual GST carve-up.

It supported moving to a per capita allocation of GST in a move that would give WA more than $3 billion a year extra in cash.

But Canberra would be left to stump up more money to mendicant States such as Tasmania and South Australia.

While there are no detailed figures on how much would be saved by the Commission’s proposals, it estimates total spending could be between $60 billion and $70 billion lower by 2023-24.

Ahead of the Commission’s report, Treasurer Joe Hockey said he wanted to adopt a “vast majority” of the recommendations.

Key Recommendations

Reduce rate at which age pension is increased | Include family home in age pension asset test | Allow States to impose their own income tax | Abolish Family Tax Benefit B | Cut threshold to abolish a new single Family Tax Benefit | Reduce the rate of increase in minimum wage | Force young unemployed to move after 12 months on Newstart | Reduce planned Federal funding for hospitals | Toughen access to carers’ allowance | Force university students to pay more of their tuition, and at a faster rate

The West Australian

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