By Mehroz Siraj
Opposition Leader Tony Abbott’s budget reply speech to the parliament last week has come under renewed attacks from the federal government and other senior Labor members.
In his speech last week, Abbott heavily criticized the federal government’s excessive spending and the blow out in the final budget deficit, hat was close to $19bn.
Criticizing the government’s performance on tax reforms and collections, he said that his government, if elected in September would provide tax relief for ordinary Australians by undertaking a massive restructuring of the taxation regime.
“Within two years, an incoming Coalition government will consult with the community to produce a comprehensive white paper on tax reform,” he said, adding that the recommendations of the document would be taken on-board impartially.
“The carbon tax will go but no one’s personal tax will go up and no one’s fortnightly pension or benefit will go down,” he said.
“Weekly and fortnightly budgets will be under less pressure as electricity prices fall and gas prices fall and the carbon tax no longer cascades through our economy,” he added.
However, Abbott failed to produce any empirical financial data or any economic logic to back his claims.
These claims had been severely criticized by members of the ruling government.
Administration officials have labelled Abbott’s pledge on repealing the carbon tax as a fallacy.
His claim about bringing in broad based taxation restructuring has been viewed by government officials as a veiled statement about increasing the GST ratios, which they believe would worsen cost of living pressures for many Australians.
“In Tasmania, you know that he has plans to rip $600 million out of your GST every time he goes to Western Australia he says so,” Prime Minister Julia Gillard said on Friday, referring to the GST pay out issues that her government had to face up with the WA state government of Premier Colin Barnett.
While presenting the Coalition’s plans on cost cutting and saving, Abbott had said that his government had alternatives to many of the ALP’s high spending plans, which were equally viable.
He said that his government would deliver a broadband network at a cost of $30billion, roughly $60billion lesser than Labor’s NBN, according to the Coalition’s own statistics.
He announced that his government would delay the rise in compulsory superannuation payments from 9 to 12 percent by two years, saving the national exchequer $5billion.
He also did not announce a continuation of Labor’s proposed school funding program, the Gonski reforms.
Under this plan, as unveiled by the government last month, states that signed up would receive a total of $14bn worth of funding for their primary and secondary schools.
Abbott’s failure to commit to the Gonski reforms earned him sharp rebuke from the Labor frontbenchers.
“What Mr Abbott’s figure means is that schools around the country would be more than $16 billion worse off,” the Prime Minister said in parliament last week.
His delays to the rise in compulsory superannuation were sharply criticized by Gillard and former Prime Minister Paul Keating, the mastermind of Australia’s superannuation program.
Keating said that an average Australian worker would be worse off by $20,000 under Abbott’s superannuation restructuring.
Gillard however remarked that research showed that under Abbott’s plans, working Australians in the 30s would be worse off by $127,000 throughout the remainder of their working lives.
Refuting the government’s criticisms, Abbott said that the spending cuts that he announced in his budget reply speech were necessary as Labor’s collective deficit over the last six years had mothballed to a mammoth $220billion.
“The trouble with the current government is that it has never graduated from being an opposition to being a government,” he said in parliament last week.
In his budget reply speech, Abbott argued that Labor’s financial mismanagement could take Australia’s debts beyond $400billion.
Defending his spending cuts and tax restructuring, Abbott said that these measures would help in reducing financial burdens on Australian families and would make the local manufacturing industry more productive and competitive.