Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Government in the Senate) Share this | Hansard source

As part of this government’s pre-election savings commitments, we announced that we would reverse the family trust changes made by the previous government to fund more urgent budget priorities. Before finalising the implementation details of this measure, the government listened closely to the concerns affecting taxpayers, their agents and tax professionals. Some of the amendments introduced in 2007 were largely technical improvements to the family trust election system. The government has decided not to reverse all of the changes. Instead, only two of the changes will be reversed.

The government will amend the law to restore the previous definition of ‘family’, which did not include lineal descendants other than the children or grandchildren of the test individual or the test individual’s spouse. This change will take effect from 1 July 2008. The government will also preclude family trusts making a once-off variation to the test individual specified in a family trust election, other than in relation to a marriage breakdown. This change will have effect from the 2007-08 income year. The government’s pre-election commitment would have entailed reversing all seven of the family trust changes made by the previous government. This savings measure is largely consistent with the pre-election commitment and will provide cost savings estimated at $24 million over four years, because we take seriously the battle against inflation—unlike those opposite, who are still deluding themselves that it is a fairytale, who are deluding themselves that they have not left the country with the highest level of inflation in 16 years.

They have no policy whatsoever to deal with these challenges. They had spending running at four per cent—so much for the finance minister and the Treasurer and their tough economic measures. That was a government that had spending out of control, that was involved in nothing other than pork-barrelling, that ignored all the warnings from the Reserve Bank, that ignored the opportunity to spend on infrastructure that this country so desperately needs, infrastructure like a broadband network—