Thursday, April 02, 2015

2016 Budget Watch. Parliament Closed Until Budget Day. The Leaks Begin!

Last Budget Night was on Tuesday 13th May, 2014 and it is still not finalised -apparently $27Billion still unresolved!
We now look forward to see what we might see next time. I am sure that it will be fun.
Budget Night is May 12, 2015.
Articles looking forward and back this week include.

General Budget Issues.

A roadmap for the 2015 Budget: increasing tax revenue!

The Conversation 21 March 2015, 6:00am
Discussions of tax usually focus on tax rates, not on tax bases. But both offer possibilities to increase the total tax take, says University of Melbourne Economics Professor Peter Lloyd (via The Conversation).
PRIME MINISTER Tony Abbott has suggested that people will find the 2015 Federal Budget “pretty dull and pretty routine”, which has been interpreted as meaning the Federal Government is likely to continue its approach of cutting expenditure.
An odd feature of the budget discussion is the absence of measures that would increase total taxation revenue. This is a one-sided approach to preparing a budget.
A change in the size of the budget deficit can be achieved either by increasing tax revenues or by reducing total expenditures. I take as given the need to reduce the size of the structural budget deficit. So too is the need for reform of major expenditures such as health and income transfer programmes.

Editorial: It’s the time for ‘safety first’ politics – the electorate won’t take too much pain

  • The Editor
  • The Sunday Mail (Qld)
  • March 22, 2015 12:00AM
IT’S no coincidence that the Palaszczuk Government hasn’t picked a fight with anyone yet.
Learning a big lesson from the former Newman government, Ms Palaszczuk has adopted a steady-as-she-goes approach to legislative reform and getting on with the job of governing Queensland.
This will be a far different government to that of the LNP.
Over the past decade, politics has changed forever in Australia.
Gone are the days of governments having a big enough majority to believe they will be there for the long haul.

Hockey to explain Budget path

Nick Butterly and Shane Wright Canberra
March 23, 2015, 12:35 am
Deep dismay among Liberals at the Abbott Government's confused economic message will force Treasurer Joe Hockey to give a special address to the party room.
Mr Hockey is likely to face a meeting of coalition MPs tomorrow where he will make a statement on the nation's finances and make clear whether the Government will push ahead with its stalled program of cost cutting.
After years of warning that Australia was facing a "Budget emergency", Tony Abbott abruptly changed his rhetoric last week to say the situation was now "manageable" and predicted the coming May Budget would be "pretty dull" and "routine".
This change in language came despite a predicted worsening Budget bottom line, with falling commodity prices and the failure to get key policies through the Senate set to blow out this year's deficit beyond $40 billion.

There will be cuts in budget says Josh Frydenberg

  • AAP
  • March 22, 2015 2:43PM
JUST because Prime Minister Tony Abbott says the budget will be “dull”, it doesn’t mean there won’t be spending cuts says Josh Frydenberg.
The Assistant Treasurer says the government remains “absolutely” committed to cutting government spending.
“We have to lower it and ultimately we are cutting it,” Mr Frydenberg told Network Ten today.
But Labor finance spokesman Tony Burke said it would be better to have a 10-year plan to fix the budget that accurately identifies the problem to turn it around.
“There’s no point doing some massive, immediate fiscal consolidation that just hurts consumer confidence and has an ongoing impact on unemployment,” Mr Burke told ABC TV.

Business worried by budget approach

  • AAP with a staff reporter
  • March 23, 2015 8:30AM
Business groups are becoming increasingly uneasy about the Abbott government's relaxed approach to its second budget.
"The last thing we need ... is another year of paralysis and doubt about what the government can do," Australian Industry Group CEO Innes Willox told ABC Radio on Monday.
Prime Minister Tony Abbott has said Australians should expect a "quite dull" budget in May.
Mr Willox said "clean air and some very clear objectives" should be the budget priority over the next year to address structural problems in the economy.

Joe Hockey to tart up the budget with lipstick

Date March 24, 2015 - 2:23AM

Peter Martin

The Treasurer moans about Labor’s budget tricks, yet considers a similar sleight of hand.
Never have I less looked forward to a budget. The one due in seven weeks is going to make me feel dreadful; not because of what it will do, but because of what it won't do.    
Last year's budget (Abbott's and Hockey's first) genuinely attempted to bring spending and income into line. Sure, it gave away revenue by axing the mining and carbon taxes (fulfilling an election promise) but it also wound back the growth in pension payments, froze family payments and indexed fuel excise so it would grow over time.
Its gaping hole was any action on winding back Australia's gargantuan and expanding network of tax concessions, most of which are for superannuation. Treasury's most conservative estimate has the concession for contributions to super funds costing $15.5 billion this financial year, climbing to $18 billion over three years. The tax concession for the earnings of funds costs $12 billion and is set to almost double to $22 billion. By way of comparison, Medicare costs $20 billion.

Staying on message is vital to sustainable finances

The political constituency for repairing the structural defects in the federal budget is neither large nor steadfast, especially as the Abbott government keeps opting in and out of the reform movement.
On Tuesday, Joe Hockey told parliament the May budget, now less than seven weeks away, would be “responsible, measured and fair”. Yet in a presentation to Coalition MPs, the Treasurer said he would get the budget back to surplus “as soon as possible”. That’s irresponsible, lazy and unfair to future taxpayers. Economists can vacillate and obfuscate, but this lack of urgency and precision is as discomfiting as a Wayne Swan budget speech. Mr Hockey told colleagues all new spending would be offset by savings. Where have we heard that before? Oh yes, that comes from the failed treasurers’ little book of talking points.

Apparent Leaks.

Tax on bank deposits in federal budget

by Phillip Coorey, Lisa Murray and James Eyers
The federal government is planning a tax on bank deposits at the May budget in a move that will raise about $500 million a year but which bankers warn could be passed on to customers.
Sources have told AFR Weekend that the government is set to proceed with the bank deposits insurance levy, first proposed by the former Labor government, to shore up revenue and to act as an alternative to forcing banks to hold extra capital as insurance against collapse. 
Tony Abbott has ruled out going after households in the May 12 budget following the negative reaction to measures in the 2014 budget.
The bank tax, as proposed by Labor ahead of the 2013 election, where it lost government, would be a 0.05 per cent levy on every deposit of up to $250,000. It was scheduled to start on January 1, 2016, and budgeted to raise $733 million in its first 18 months of operation. 

Political Instability.

Budget, state troubles hit Liberal brand: Kemp

Rick Wallace

The Abbott government’s unpopular 2014 budget has been blamed as a contributing factor to the Victorian Coalition’s electoral defeat last year in a frank post-mortem delivered by party elder and former federal minister David Kemp today.
Dr Kemp said Joe Hockey’s 2014 Budget had damaged “perceptions of the Liberal brand” and some of the decisions of the Abbott government on fuel excise and other issues had stifled the premier Denis Napthine’s chances of winning a second term in November 2014.
“There can be no doubt that federal perceptions impacted on the result,” he said.
“The campaign occurred in a context where the Liberal Party’s standing federally, and in each state, had declined significantly.
“The poor reception of the 2014 federal Budget led to another decline in public perceptions of the Liberal brand.

Tony Abbott’s fate is largely in Treasurer Joe Hockey’s hands

Chris Kenny

For Tony Abbott, today’s NSW election will be like a medieval witch trial — if Mike Baird sinks everyone will blame Abbott but if the Premier floats the commentators will praise him for prevailing despite the Abbott drag.
Truth be known, a solid performance by the NSW Coalition has to be seen as another fillip for Abbott, who has been steadily recovering since his spill scare.
Defining a strong performance is the difficulty because after the shock of the Queensland election any state government might be forgiven for accepting any win, regardless of the margin. The Baird government is up against a dispirited, undermanned and ideologically aimless NSW ALP that has been tainted by serious corruption.
And while the nation is gripped by economic uncertainty, Baird has seen his state regain its place at the economic vanguard of the nation. Yet Baird has significant factors working against him. There is the natural return of the electoral pendulum to some normality after Labor suffered the worst loss in Australian political history four years ago.

Health Budget Issues.

Medicare freeze to cost Australians $10 for each GP visit

Date March 23, 2015 - 12:15AM

Jenna Price

The decision to freeze Medicare payments until 2018 will cost Australians about $10 -double the government's failed copayment - every time they visit the doctor.
Doctors say the freeze will affect the quality of care. General practitioners will be forced to either charge patients more for consultations because medical practices can no longer absorb the cost of running local medicine or see more patients to ensure consistent income.
New research published in the Medical Journal of Australia on Monday today reveals that GPs' income will decline for each consultation. GPs will be at least $4 worse off for each patient, but because they usually only charge a gap to non-concessional patients, they will be forced to charge a minimum of $8.43 or absorb the cut of 7.1 per cent.
Chris Harrison, lead researcher and senior research analyst at the Family Medicine Research Centre at the University of Sydney, says: "The government is now forcing GPs to hold the hat out."
23 March 2015, 6.15am AEDT

High cost of GP rebate freeze may see co-payments rise from the dead

WWith GPs facing greater economic pressure and the health minister considering legislative change to make it easier for GP to charge them, GP co-payments, like Lazarus, may rise again from the dead.

Authors Christopher Harrison, Clare Bayram , Graeme Miller, Helena Britt

Prime Minister Tony Abbott has declared that GP co-payments are “dead, buried and cremated”. This contrasts with health minister Sussan Ley’s desire to “reduce the number of bulk-billed consultations to people who can afford to pay something”.
So, what is likely to emerge from Ley’s Medicare reform consultations?
In a paper published today in the Medical Journal of Australia, our new modelling shows the freeze on Medicare fees paid to GPs will leave doctors A$8.43 worse off per consultation with non-concessional patients by 2017-18. That’s a bigger shortfall than the now-abandoned A$5 rebate cut – and is likely to prompt many GPs to start charging a co-payment.
Currently, legislative restraints mean that GPs are only able to charge the government directly for patient care (bulk-billing) if they do not charge the patient a co-payment.

Name and shame high-charging specialists to rein in excessive fees: ex-Abbott advisor

Date March 23, 2015 - 11:40PM

Dan Harrison

Health and Indigenous Affairs Correspondent

Medical specialists who charge exorbitant fees should be "named and shamed" in a bid to rein in excessive charging, according to a former advisor to Tony Abbott.
Policy consultant Terry Barnes, who advised Mr Abbott when he was health minister in the Howard government, also argues government should define what constitutes unreasonably high fees, and make debts on these unenforceable.
Mr Barnes, who kickstarted debate about a Medicare co-payment with his 2013 submission to the Commission of Audit, told a private hospitals conference in Melbourne on Monday that patients should be allowed to assign their choice of specialist and hospital to their health fund or an advocate, to help them get a better deal.

Budget uncertainty ‘placing lives at risk’

7:15am, Mar 25, 2015
Kaitlin Thals PM News Reporter
Mental health and disability groups are uncertain whether funding for critical support services and programs will continue past June 30.
Uncertainty lies with thousands of Australians seeking help.
Disability and mental health groups say funding uncertainty related to the federal government’s upcoming budget is putting people’s lives at risk.
Thousands of Australians seeking help for mental health problems and disability are unsure if funding for critical support services and programs will continue past June 30.
Treasurer Joe Hockey reportedly told his party room on Tuesday that the savings he will propose in the May budget will be “responsible, measured and fair”, but fears about cuts to funding have motivated 70 mental health groups to combine forces.
The groups, including Mental Health Australia, Headspace, and the Black Dog Institute, wrote an open letter to Mr Abbott and Health Minister Sussan Ley, with a clear message –  “ensure the continuity of services or risk a mental health system failure in the very near future”.
The letter says: “We have not received any definitive advice regarding the future of programs.”

Public hospitals pass the buck on cost of scans to federal government

Sean Parnell

An investigation has identified 77 public hospitals where X-rays, scans and expensive diagnostic tests have been wrongly billed to Medicare.
The widespread and, in some cases, fraudulent cost-shifting has embroiled about one in 10 public hospitals in Australia, adding another dimension to the ongoing debate over federal-state funding agreements. The Abbott government has caused ructions in the health sector by scaling back funding agreements by billions of dollars, freezing Medicare rebates and imposing other cuts.
Documents obtained by The Australian under Freedom of Information laws show the 77 hos­pitals relieved pressure on their budgets by billing hundreds of thousands of dollars worth of ­diagnostic imaging to Medicare each month. Funding agreements require such services to be paid for by the state government, with some money from the commonwealth, not diverted into a payment system meant for commonwealth-funded primary and private healthcare.

ACT health spending still rising sharply, federal funding not keeping up

Date March 28, 2015 - 11:00PM

Ben Westcott

Reporter at The Canberra Times

ACT Health Minister Simon Corbell says steps have been taken to bring the budget under control, but the federal government had yet to recognise the ACT's special status as a provider for a larger region.
NSW patients utilising ACT hospitals for healthcare havecaused territory health spending to continue to rise, leading the ACT Health Minister to call once again for the territory to be paid according to its role as healthcare provider for the region.
Between 2007 and 2013, ACT government spending on hospitals rose by 4.9 per cent per person, the highest of any jurisdiction in Australia and 2 per cent above the national average.

Pharmacy Issues.

Was the 5CPA a funding black hole?

24 March, 2015 Chris Brooker
A Guild leader has taken to task claims in a GP publication that $15 billion in pharmacy funding has been "lost in space".
Anthony Tassone, president of the Pharmacy Guild of Australia (Victoria) says the Fifth Community Pharmacy Agreement delivered equity and access to medicines, rather than being a "$15 billion black hole" as claimed by Australian Doctor.
In a letter, Mr Tassone (pictured) said: "Far from a ‘$15 billion black hole’ the 5th community pharmacy agreement helped deliver equitable access to lifesaving medicines across a national network of over 5000 pharmacies in our geographically sparse and diverse country.
"What is even more remarkable is that the superior accessibility of community pharmacy is achieved despite there being 15% less pharmacies than medical centres. That is the efficient distribution that results from the pharmacy location rules".

Pharmacy Guild asked to explain how it spent hundreds of millions taxpayers money

  • March 26, 2015
  • Sue Dunlevy
The Pharmacy Guild could have to explain how it spent hundreds of millions in taxpayer funds after the Greens requested an audit investigation.
It comes after an audit report this month revealed the Pharmacy Guild could not say how many staff it employed with $29 million taxpayer funds it was given for administration.
The audit was told some chemists were counting SMS reminders to patients that their scripts were ready to be picked up as “clinical interventions” that attracted a taxpayer fee.
And it found a $1.50 per script was paid to chemists to swap cheaper medicines for those with a premium was paid even when there was no swap.
I also have to say reading all the articles I still have no idea what is actually going to happen with the 2016 Budget (or the Government) at the end of the day.
Nonetheless I am sure there will be lots of fun to observe over the next few weeks.

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