Greg Combet (Charlton, Australian Labor Party, Parliamentary Secretary for Defence Procurement) Share this | Hansard source

I rise to speak in this debate on the appropriations bills about some of the initiatives that were contained within the recent budget and how they will impact upon the residents of my electorate of Charlton in New South Wales. Residents in Charlton have, like families around the country, been feeling the pressures of the rising costs of living. Groceries, rent and petrol have all increased by more than 10 per cent over the last two years, and that has included increases of 14 per cent in the price of fruit and vegetables, 18 per cent in the price of bread and 16 per cent in the price of milk. With a median housing loan repayment of around $1,315 a month, families in Charlton have also felt sharply the pressure of rising inflation and interest rates in recent years. It is very important for them that the government does its part to help relieve these financial pressures.

That is why it is so crucial that in the recent budget the government announced the $55 billion Working Families Support Package to help support those who are finding it hard to make ends meet. By any measure, this announcement by the Treasurer in the budget is a hugely significant initiative. It is a substantial package including a number of components that will help residents of my electorate with some of the cost pressures they are now facing. As a whole, these components will benefit residents in my electorate to a very significant degree. I would like to explain briefly some of the components that will assist, but when you look at the combined measures in the budget at an aggregate level and analyse them against the nature of earnings in my electorate you will see just how significant they may be.

Within Charlton, the median family income is around $1,100 per week, or around $58,000 per year. I will outline what, on aggregate, many of the measures in the $55 billion Working Families Support Package in the budget mean to them. For example, it is estimated that a couple in my electorate earning a median income and with two children aged two and four both in long day care will be nearly $3,000 a year, or $57 a week, better off under this package. For a couple with two children—one aged four and in long day care and the other aged six and in after-school care—it could mean an increase of $2,760 a year, or around $54 a week. A couple with two children aged 10 and 13 and, obviously, not in child care could benefit from the budget measures in the order of $53 a week, or $2,775 a year. For a couple with two teenage children, also obviously not in child care, it could mean an increase of $3,300 a year, or $63 a week. For a couple with three children—for example, aged nine, 13 and 14—it could mean an increase in their annual income of $3,600, or $70 a week. That is why it is absolutely absurd and hypocritical to hear from the other side that the $55 billion Working Families Support Package contained in this budget is in some way harmful to working families. These are significant measures that will benefit many, many families throughout the country and in particular in my electorate.

I now turn to some of the individual components of the measures within the budget. The tax cuts contained in the budget total around $46.7 billion. The tax cuts are designed to help alleviate the pressures that people are now facing, while also providing incentives for increased participation in the workforce. The government’s tax cuts incorporate an increase in the low-income tax offset from $750 to $1,200, which will allow Australians to earn up to $14,000—effectively an increase of $3,000 in the threshold—in 2008-09 without having to pay any tax at all. That is a significant benefit for low-income earners and people in part-time work. About 30 per cent of my electorate currently work part time and they will welcome these changes. With a median individual income in my electorate of around $400 a week—only $21,000 a year—the low-income tax offsets will be an enormous contribution to helping family budgets.

The education tax refund is a crucial component of the package. The budget contained funding for the refund to the value of $4.4 billion in total over the forward estimates. Under this arrangement, parents entitled to family tax benefit A or whose children receive the youth allowance or a similar payment will be able to claim a 50 per cent tax refund of up to $750 in educational expenses for each child in primary school—that is a refund of $375—or a 50 per cent tax refund of up to $1,500 in expenses for each student in secondary school, a rebate of $750 per child per year. These are significant amounts of money for people who have children in school, and that is why the education tax refund initiative will be very welcomed by people. In fact, the majority of families in my electorate have two children, and the next highest group or family structure are families with three children. The education tax refund will directly benefit them. For families with two school-age children this new arrangement could mean a maximum family benefit of $14,200 over their full school life, and for families with three kids it could mean up to $21,000 benefit for those families over the full school period. No-one can argue that that is not a significant benefit for many working families, particularly those who are doing it tough in the current environment.

The childcare tax rebate is an extremely important initiative as well, costed at around $1.6 billion for an increase in the rebate from 30 to 50 per cent, and the annual cap in the amount paid increases too in the budget from $4,354 to $7,500 per child. The rebate will be paid quarterly, which will of course assist with cash flow management. But, for an average family in Charlton where one parent is considering returning to work, the increase in the threshold on some estimates could deliver a benefit of $2,000 more than has existed in the past.

Housing affordability measures are also extremely important in the context of my electorate, where about 21 per cent of households are currently renting—and of course many of those would be renting while they are saving to try and put a deposit together to buy a home. For them, the first home saver account to help young people save for their first home is extremely important.

The budget provided $491 million for the Teen Dental Plan. This again will be very important for people. Eligible families will be able to claim up to $150 per year for a preventative dental check for each of their teenage children, making it far more affordable for families to access dental services. The residents of my electorate will appreciate the high costs associated with a visit to the dentist—we all know that. The teen dental health plan can assist in family budgeting when there are teenagers, in their developmental years. Dental costs can be extremely high. As nearly 40 per cent of the families in my electorate have children under the age of 15—that is a significant number—this is a welcome initiative, and people have indicated that to me, for very obvious reasons.

The Medicare levy surcharge is also a measure which can provide significant relief for many people. Under the budget, from 1 July this year singles with incomes of up to $100,000 and families with incomes of up to $150,000 will no longer be subject to the Medicare levy surcharge if they do not take out private health insurance. This simply restores the thresholds effectively to the position that they were in when the levy and the surcharge were initially introduced in 1997. This will mean that singles without private health insurance can save up to $1,000 a year should they choose not to take out private health insurance, and families will save up to $1,500 a year potentially from these changes. That is significant relief for people.

The budget also provides a range of support measures for seniors and carers, and there are also a range of previous measures that have already been implemented. My electorate has a higher than average proportion of retirees and seniors. Many people retire to the electorate and the shores of Lake Macquarie, particularly from the Sydney region. To assist older Australians with the rising costs of living, the government has provided in the budget for an increase in a number of things that came into effect from late March: an increase in the utilities allowance from $107 to $500 per year, an increase in the seniors concession allowance from $218 to $500 per year, an increase in the telephone allowance from $88 to $132 per year and, of course, the $500 seniors bonus. No-one on that side of parliament can honestly look you in the eye and say that that is not significant assistance for seniors and carers in this country. It will result in a substantial rise in the income received by many of the people who are most deserving in our community. With 15 per cent of my electorate over the age of 65, I am very happy to see an increase in the support provided to that group.

These are simply some of the reasons why the budget is extremely important for working people. In aggregate, the budget of course tackles the inflation issue and it provides for the future with the establishment of a number of funds, particularly aimed at infrastructure, education and health. But, most importantly, the budget is designed to assist working families who are in need. The $55 billion Working Families Support Package will help people across the Australian community, in particular in my electorate, and I welcome it.

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