June 03 Edition
With the Budget on May 3 now almost forgotten we are now off and rolling in the election campaign. We are seeing a lot of promises with Health from Labor with Medicare well and truly in focus.
As we move further into the campaign I am sure it will become more interesting - with the polls as tight as they are at present - and seemingly getting tighter.
I also note concerns on economic growth, the changes to superannuation as well as continuing cuts in other areas. It will be a while yet before it is clear just what the final outcomes of policy in both parties will be.
General Budget Issues.
Worries about budget in election of choice
- on May 22, 2016, 1:47 pm
Labor argues the budget can't afford the Turnbull government's $50 billion in business tax cuts, but that's not stopping the opposition redirecting the money for its own agenda.
It's all about choice.
But such choices come at a time when the heads of Treasury and the Department of Finance, as well as a major global rating agency, express concern about the budget outlook.
After the Pre-election Economic and Fiscal Outlook was released on Friday, Moody's Investors Service again described as "challenging" the government's plan to bring the budget back to surplus in 2021.
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Deflation looms: how to be alert amidst the gloom
By Tony Featherstone | 23.05.2016
The dreaded D-word, “deflation”, is getting more airplay in financial markets. Australia is following international trends with lower interest rates and expectations are rising that the Reserve Bank will cut interest rates at least once more this year.
Could Australia fall into a deflationary spiral where even zero interest cannot stop price fallings? And where consumers defer purchases because they expect lower future prices, and lower-than-expected inflation increases the real burden of debt?
An all-time low of 2.2 per cent on the 10-year Australian Government bond this week shows just how concerned the market has become about future economic growth. For context, the Government bond yield fell to 4 per cent after the 2008-09 Global Financial Crisis. Even a 2.2 per cent bond yield looks like a luxury compared with several advanced economies that have negative bond yields.
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- May 22 2016 at 11:45 PM
- Updated May 22 2016 at 11:45 PM
Election 2016: Shorten's $8b drag on budget
by Laura Tingle
A Labor commitment to unwind another Coalition budget saving has taken the cost of major promises on schools and health over the next four years to at least $8 billion, raising the prospect that pledges to date could leave the budget worse off in the short term.
An initial look at Labor's major spending and saving promises appears to leave the opposition with significant room to move to spend more over the budget period and still claim an improvement in the budget bottom line of around $8 billion.
But a number of its tax increases and savings measures have subsequently been taken up by the government, meaning that the claimed budget improvement may not be anywhere near as great.
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Why you can’t believe the budget forecasts
- The Australian
- May 21, 2016 12:00AM
Terry McCrann
Treasury’s pre-election economic and fiscal update was never going to contradict the budget and the retiring government. Properly ‘‘managed’’, it never does.
But retiring — more accurately, sacked — Reserve Bank director John Edwards certainly does, and will continue to do so, whichever side wins the election. I can’t help feeling that any criticisms from him would be more frequent and more powerful if the government is re-elected.
We should long ago have been disabused of the belief that just once, every three years — like a fiscal version of the fantasy musical Brigadoon — the fiscal and economic truth would erupt from the mouths of the Treasury and finance secretaries in their pre-election exercise known as PEFO.
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Election 2016: The black hole in ScoMo's $67b black hole
Date May 24, 2016 - 6:18PM
James Massola
Chief Political Reporter
Treasurer Scott Morrison has denied there is a black hole of as much as $35 billion in the government's own claim that Labor has a $67-billion, four-year black hole in its budget costings.
As debate over policy costings erupted on Tuesday ahead of Friday's economic debate at the National Press Club, the Coalition's attempt to attack Labor's costings backfired and the Treasurer was forced to admit an $18 billion error - which may grow as high as $35 billion - in its $67 billion claim.
The under-pressure Treasurer, when confronted by errors in government calculations of Labor policies, back-tracked and conceded that the claimed Labor funding shortfall was "at least $32 billion and as much as $67 billion. They are well behind".
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- May 25 2016 at 11:45 PM
- Updated May 25 2016 at 11:45 PM
We are not living within our means
by The Australian Financial Review
In late 2014, Reserve Bank governor Glenn Stevens told The Australian Financial Review that Australians had voted for lots of new public services, but were yet to vote on how to pay for them. With spending still climbing and the revenues of the resources boom continuing to crumble, the budget deficit outlook has got worse. On Tuesday, Mr Stevens warned that whoever wins the July 2 election will face years of hard and unpopular decisions to fix the mess.
Last Friday, two other top econocrats, the Treasury and Finance departmental secretaries John Fraser and Jane Halton, in an unprecedented commentary in their independent pre-election economic and fiscal outlook (PEFO) spelled out what that means. To remain on any medium term track to a surplus, they said, either spending will have to be cut substantially, or taxes will have to rise above the average for the last 30 years. And expressing as much scepticism as public servants are able, they suggested that neither side of politics has much of a record at cutting spending. Their PEFO forecasts also assumed that we can keep up the same pace of policy reform to boost productivity, the economy and the tax base that we have for the last 30 years. That was the time we floated the dollar, dismantled import protection, privatised a bunch of government businesses and genuinely reformed the tax system. In today's political climate, a repeat performance seems like a fantasy.
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Federal election 2016: budget problem bigger than both sides think
- The Australian
- May 26, 2016 12:00AM
David Uren
One of the dividing lines between Labor and the Coalition is whether the budget has a revenue or a spending problem. Labor’s Chris Bowen says revenue is falling short and the answer is to raise more in taxes, through tax increases and closing loopholes.
The Coalition’s Scott Morrison says revenue will be at its long-term average level by 2017-18 but spending will remain at elevated levels far into the future and can be brought back into balance only with significant spending restraint.
The truth is that the budget is in trouble on both the revenue and spending side; however, cranking up taxes, as Labor proposes, is no solution. The problem with the Treasurer’s analysis is that it assumes revenue will grow at an average rate of 7 per cent a year into the future to reach the long-term average. That assumption is not unreasonable measured against long-term averages, but it misses the cause of the repeated blowouts in budget deficits across the past four years.
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Election 2016: Forget about searching for budget black holes, they're not there
Date May 25, 2016
Peter Martin
Economics Editor, The Age
This time last election the Rudd Labor government blew itself up with a document purporting to find a $70 billion black hole in the Coalition's costings.
The mistakes say much about the helplessness of government staffers when they are without the support of the bureaucracy.
There wasn't. The error-ridden claim was rated "false" in the first Fairfax-Politifact fact check and set the tone for the rest of the campaign.
Rattled, Labor had jumped at shadows. Twenty billion of its total shouldn't have been there and much of the rest was guesswork based on figures the Coalition hadn't yet provided, or had provided but Labor chose not to believe.
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Another day, another billion dollars: we are deep in debt and deficits denial
Date May 26, 2016 - 6:30PM
Jessica Irvine
Senior Writer
It happened again on Wednesday, at precisely 11am.
A few days prior, an official sitting at a computer in the Treasury building in Canberra sent out an alert.
Across the Sydney trading rooms of the big four Aussie banks and the local arms of international banks – about 15 of them in total – an alarm sounded and a message flashed on screen to notify them of the upcoming event.
Hey buddy, can you spare a billion dollars? Australian government debt is on course to top the $500 billion limit next year.
Traders hit the phones, talking to bank clients to see: "Do we want in?"
At 10.45am on Wednesday, the traders logged in to a special computer application called "Yieldbroker" where they began to make bids.
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http://www.smh.com.au/comment/the-alarm-bells-that-our-politicians-are-ignoring-20160527-gp5ipa.html
The alarm bells that our politicians are ignoring
Date May 28, 2016 - 12:00AM
Peter Hartcher
Sydney Morning Herald political and international editor
At a corporate handwringing session this week, business leaders piled one political worry on top of another and pretty soon you might have expected Chicken Little to rush in and scream that the sky was falling.
Instead, a respected businesswoman arrested the growing hysteria over global and local political dangers.
Neither side is ready to tell us yet exactly how much more debt they are going to get us into.
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'Growth and jobs': the numbers that debunk a company tax cut
Date May 28, 2016 - 12:15AM
Ross Gittins
The Sydney Morning Herald's Economics Editor
OPINION
Malcolm Turnbull and the many economists supporting his plan for a 10-year phased cut in the rate of company tax have failed to make the case that this expensive measure would deliver a significant increase in "growth and jobs".
Economists are meant to be too hard-headed to believe in the existence of a magic bullet – the single measure that will work wonders in solving our problems.
After 20 or 25 or 30 years, the level of real after-tax wages will be 0.4 per cent higher than otherwise.
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Health Budget Issues.
Labor promises to keep medication cheaper at cost of $3.6bn over 10 years
Bill Shorten pledges to axe 2014 budget cut to pharmaceutical benefits scheme, which has been booked as saving $1.3bn but is blocked by the Senate
Bill Shorten at Drummoyne medical centre in Sydney, where 15 month old Eleanor Luopis and her mum Katherine were getting a cough checked out. Photograph: Mike Bowers for the Guardian
Paul Karp with agencies
Sunday 22 May 2016 09.00 AEST Last modified on Sunday 22 May 2016 12.30 AEST
Patients will pay less for taxpayer-subsidised medication if federal Labor wins the election, but the move will cost $3.6bn over a decade.
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22 May 2016 - 4:20pm
False economy to cut health funding: Labor
Source: AAP 22 May 2016 - 4:20 PM
Federal Labor won't make any major funding cuts to health amid warnings about the state of the budget.
After the Pre-election Economic and Fiscal Outlook was released on Friday, Global credit rating agency Moody's Investors Service warned the rising government debt burden would constrain the ability to buffer "potential negative economic shocks".
Opposition health spokeswoman Catherine King insists Labor has been pretty cautious when it comes to saving money in the health budget.
"We are not proposing to make major cuts," she told Sky News on Sunday.
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Labor sticks to indexed medicines charge
- on May 22, 2016, 3:11 pm
Most Australians wouldn't know it, but each year they pay a little bit more for taxpayer-subsidised medicines.
Labor wants to keep it that way while the coalition wants a one-off increase to the amount we contribute towards the cost of every prescription.
Under a plan, first included in the Abbott government's infamous 2014 budget and retained in the latest edition, most Australians would pay an extra $5 for each prescription under the Pharmaceutical Benefits Scheme.
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Advocates call for end to aged care 'lottery': 'I want him to enjoy the time he's got left'
Date May 23, 2016 - 8:39AM
Jane Lee
Legal affairs, health and science reporter
Exclusive
Doctors told Dominica Vevile shortly before Christmas last year that after almost a year in hospital her father Giovanni may not live beyond the new year.
Giovanni has one kidney left, which works at 5 per cent capacity. He has been diagnosed with chronic renal failure and chronic heart disease.
Last year, he was found to be eligible for a "level four" federally funded aged care package to help care for him at home. This would pay for aged care workers to take him out twice a week, which would also provide respite for his wife.
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2016 Federal Election: Live coverage of Day 14 of the campaign
May 23, 2016 9:30am
FEDERAL Health Minister Sussan Ley has broken ranks with Cabinet, revealing it is her preference to have the Medicare rebate freeze lifted as soon as possible.
Speaking on ABC radio this morning, the Health Minister said: “I said to doctors I want that freeze lifted as soon as possible, but I appreciate that Finance and Treasury aren’t allowing me to do it just yet.”
The admission is set to take the wind out of the Coalition’s sails as it sought to push home a message that Labor’s ‘spendometer’ was out of control.
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Election 2016: Health Minister Sussan Ley 'not allowed' to lift Medicare freeze
Date May 23, 2016 - 3:01PM
Jane Lee
Legal affairs, health and science reporter
Health Minister Sussan Ley says she wanted to lift the freeze on Medicare rebates but was prevented from doing so by "Finance and Treasury".
Labor has pledged to lift the freeze from next January if elected, which is expected to cost $2.4 billion over the first four years, the most expensive spending commitment of the election campaign yet.
Doctors have said they had understood that the freeze would be lifted, rather than extended, at this year's budget. The Royal Australian College of General Practitioners and the Australian Medical Association have both launched public campaigns over the move, warning this would force more doctors to charge patients a co-payment, rather than bulk-billing them.
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Federal election 2016: Shorten warning over GP rebate freeze
- The Australian
- May 24, 2016 12:00AM
Joe Kelly
Bill Shorten has dismissed the Coalition’s superior record of delivering higher bulk billing rates since winning government, saying the extension of a contentious freeze on GP rebates means more doctors will cease the practice.
The Opposition Leader is relying heavily on doctors’ groups such as the Australian Medical Association to give credibility to his campaign against the freeze on the indexation of rebates paid to GPs under the Medical Benefits Schedule, a move Labor warns will increase patient fees by $20 a visit.
Mr Shorten campaigned on health yesterday in the West Australian seat of Hasluck, held by Liberal MP Ken Wyatt, and declared the election a referendum on the future cost of medicine and going to the doctor.
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Federal election 2016: PBS fee means we fund new drugs: Turnbull
- The Australian
- May 23, 2016 12:00AM
Sarah Martin
Labor’s pledge to scrap a proposed fee for subsidised medicines has been countered by government claims that patients could miss out on lifesaving new drugs without the measure, worth almost $1 billion.
Arguing that a new charge for prescription medicines would adversely affect millions of people, Bill Shorten promised yesterday to reverse the “co-payment by stealth” announced in the 2014 budget but blocked by the Senate.
“Sick people should not be deterred from going to the doctor because of the price of seeing the GP or the cost of medicine,” the Opposition Leader said of the government’s plan to lift the cost of subsidised prescriptions by $5 for general patients and 80c for concessional patients.
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Guild, PSA welcome Labor PBS plan
Pharmacy stakeholders have welcomed Labor’s announcement that if elected, it will scrap the Turnbull Liberal Government’s cuts to the PBS.
Labor says this will ensure that there will be no increase to PBS copayments or safety net thresholds in addition to regular indexation.
“Labor’s announcement provides patients with certainty about what they would be expected to contribute to the cost of their medicines under a Shorten Government,” the Pharmacy Guild of Australia said in a statement.
“Health Minister Sussan Ley has previously indicated she does not intend to proceed with these co-payment and safety net threshold increases, but they have been kept in the forward estimates.
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Federal election 2016: Shorten warning over GP rebate freeze
- The Australian
- May 24, 2016 12:00AM
Joe Kelly
Bill Shorten has dismissed the Coalition’s superior record of delivering higher bulk billing rates since winning government, saying the extension of a contentious freeze on GP rebates means more doctors will cease the practice.
The Opposition Leader is relying heavily on doctors’ groups such as the Australian Medical Association to give credibility to his campaign against the freeze on the indexation of rebates paid to GPs under the Medical Benefits Schedule, a move Labor warns will increase patient fees by $20 a visit.
Mr Shorten campaigned on health yesterday in the West Australian seat of Hasluck, held by Liberal MP Ken Wyatt, and declared the election a referendum on the future cost of medicine and going to the doctor.
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Federal election 2016: doctors urged to help rein in costs
- The Australian
- May 24, 2016 12:00AM
Sean Parnell
One of the doctors seeking to replace Brian Owler as president of the Australian Medical Association believes the lobby group should be working with the federal government to find savings in the health budget.
Perth gynaecologist Michael Gannon, state AMA president, will run against federal vice-president Stephen Parnis on Sunday and believes the doctors’ lobby needs to be “in the game” or risk a repeat of the bad policies the Coalition adopted without its input.
“It would be really unfair to criticise Brian for the things that have gone wrong this term, but I would hope the AMA would have a more constructive relationship with the government in future,” Dr Gannon said yesterday.
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Federal election 2016: Greens’ Di Natale $6.6bn extra for health
- The Australian
- May 26, 2016 12:00AM
Sid Maher
Greens leader Richard Di Natale has pledged more than $6.6 billion in extra funds for a range of health measures that would see dramatic increases in spending on hospitals and higher government payments for doctors.
In Goulburn in southern NSW yesterday, Senator Di Natale pledged $4bn in additional funding to public hospitals to 2020. The funding would reverse the Coalition’s lower health spending trajectory announced in the 2014 budget.
Senator Di Natale, a former GP, also pledged $2.4bn in extra funding for the Medicare Benefits Scheme, to end the freeze on payments to doctors.
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Doctors around the country bringing an end to bulk billing
May 26, 2016 12:00am
News Corp Australia Network
EXCLUSIVE.
Bulk billing is being killed off at GP practices around the country as doctors respond to the Government’s plan to freeze the Medicare rebate at $37 for six years.
A survey of over 500 doctors by the Royal Australian College of Medical Practitioners to be released today finds 14.5 million patients will face new charges to see a doctor.
Twenty nine per cent of doctors will end bulk billing for all patients as a result of the freeze.
Another 22 per cent will end bulk billing for all and introduce capped fees for low income earners, the survey shows.
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Federal election 2016: Labor pledges to set up reform commission
- The Australian
- 12:00AM May 27, 2016
Sean Parnell
Labor will set up a permanent health reform commission if elected on July 2, abandoning the various bureaucracies it established in government in favour of a new agency focused on making better use of limited budgets.
Amid mounting concern over costs to patients, governments and insurers, the new Australian Healthcare Reform Commission would seek to advise the commonwealth and the states on ways to improve outcomes and reduce disparities. Labor wants the agency to examine and evaluate structural changes to the system and also have a role in funding agreements and new payment models.
Within the new commission would be a centre for Medicare and healthcare system innovation charged with examining new payment and service delivery models to improve efficiency and efficacy.
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AMA's Brian Owler delivers scathing attack on Coalition government
Outgoing head of peak medical body calls past two years ‘a period of lost opportunity in health policy’, characterised by lack of consultation
Brian Owler also criticises government’s medical treatment of asylum seekers in detention, saying he is proud the AMA has taken a strong stance on the issue. Photograph: Lukas Coch/AAP
Friday 27 May 2016 13.02 AEST Last modified on Friday 27 May 2016 13.04 AEST
The outgoing president of the Australian Medical Association, Associate Professor Brian Owler, has delivered a scathing attack on the Coalition government, describing the past two years as “a period of lost opportunity in health policy”.
Speaking at the peak medical body’s national conference on Friday, Owler said his presidency, which began in 2014, coincided with “a turbulent time in Australian politics” including the government’s budget announcement of a patient co-payment for GP visits.
The government refused to consult with the AMA on the issue, Owler said.
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A third of GPs plan to cease all bulk-billing
27 May 2016
A THIRD of GPs will cease bulk-billing patients - including concession card holders - because of the continued freeze on Medicare rebates, an RACGP poll suggests.
Asked how the recently announced freeze extension would impact their billing policy, 163 out of 564 respondents - 29% - said they would cease all bulk-billing.
Some 122 - or 22% - said they would privately bill but cap yearly out-of-pocket fees for concession card holders.
About half said they had no plan to change their billing policy.
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Health Insurance Issues.
Public hospitals lure patients to pay for treatments with private insurance, costing funds $1 billion
May 23, 2016
News Corp Australia Network
EXCLUSIVE
NEARLY half the patients in some public hospitals are using their private insurance to pay for care in a move that is costing health funds $1 billion a year and driving up health fund premiums.
The industry estimates premiums could be slashed by $250 a year if public hospitals stopped asking patients to get their health funds to pay for their care.
Every Australian is entitled to free care in public hospitals under Medicare, but cash strapped hospitals are now making a practice of asking patients to charge their health funds to get extra revenue.
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Applied Medical criticises government pricing
- The Australian
- May 26, 2016 12:00AM
Sarah-Jane Tasker
US-based medical devices major Applied Medical has warned that competition in Australia’s health system is suppressed, calling for the scrapping of the controversial list that designates the pricing of prostheses that qualify for insurance rebates.
Applied Medical founder Nabil Hilal, who failed in his attempt to sue the health minister last year over the inefficiency of the list, said no other public market in the world operated a system with a government-sanctioned list that set the rebate for medical devices. He also said the government was dictating the price for devices used in private hospitals at many times above what public hospitals pay for the same device.
Mr Hilal said things were further complicated by large manufacturers offering private hospitals a rebate of that inflated price, to encourage them to buy their product.
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Superannuation Issues.
BT Investment chief blasts changes to superannuation
- The Australian
- May 23, 2016 12:00AM
Glenda Korporaal
The federal government had undermined community trust and confidence in its policy making with its wide-sweeping changes to superannuation in the budget, BT Investment Management chief executive Emilio Gonzalez said yesterday.
Speaking on the side of the Australian Leadership Retreat on Hayman Island, he said there was support in the community for tightening up the concessions on superannuation, including limiting post tax contributions to superannuation. But he said the government’s total package was trying to “claw back” money that people had put into super in a way that had been encouraged by government.
“The government had a very good opportunity to position the superannuation debate right with the support of the industry — around superannuation being a vehicle to fund your retirement as a supplement or a replacement for the pension.
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Unsettling the political heartland
The Government appears to have upset some rusted-on Liberal voters with its Budget changes to superannuation but it remains to be seen whether it will actually matter on polling day, Mike Taylor writes.
It is highly unusual for a Federal Budget to be brought down only days before the Parliament is prorogued ahead of what amounts to a two-month Federal Election and it seems probable the Government will come to rue the timetable it has imposed upon itself.
Looked at objectively, the 2016 Federal Budget was not an election Budget. Rather, it was arguably a mid-term Budget; one which accommodated a number of policy decisions which, while mostly sensible, are already proving problematic with respect to political saleability.
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Federal election 2016: Liberals push Morrison for super retreat
- The Australian
- May 25, 2016 12:00AM
Dennis Shanahan
Scott Morrison is resisting pressure from within the Liberal Party to review his contentious superannuation proposals aimed at raising revenue from high-income earners.
The Treasurer said yesterday he was not planning to adopt a similar review for superannuation as he has agreed on the backpackers tax announced in the budget.
The government gave in to pressure from farmers, tourism operators and National Party MPs over a proposed tax on foreign workers which threatened to undermine the market for fruit-picking and seasonal work.
The decision was deferred for six months and would be reviewed before being legislated, with many National MPs believing it would be dumped.
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Federal election 2016: Labor slams ‘chaotic’ super change
- The Australian
- May 26, 2016 12:00AM
Dennis Shanahan
The Labor Party is directly challenging the government’s contentious $500,000 “retrospective” lifetime cap on concessional super contributions that is causing deep dissent in the Liberal Party.
Bill Shorten has accused Scott Morrison and Malcolm Turnbull of sending “a shock wave through superannuation” by retrospectively “changing the goalposts”.
Opposition superannuation spokesman Jim Chalmers will today warn that the Coalition’s “chaotic” super changes announced in the budget are undermining confidence in superannuation far beyond those directly affected. “In the immediate post-budget world, you will be grappling with a set of proposed changes to superannuation which are among the most drastic since compulsory super was brought in,” Dr Chalmers says in a draft speech to be given at a superannuation conference in Sydney.
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http://www.sbs.com.au/news/article/2016/05/26/older-women-worst-affected-budget-super-changes-report
27 May 2016 - 8:04am
Older women worst-affected in budget super changes: report
Changes to tax on super contributions in the May budget will affect older women the most, modelling from NATSEM suggests.
By Jason Thomas
Source: SBS News 26 May 2016 - 1:57 PM UPDATED 1 HOUR AGO
The May budget’s changes to superannuation will affect women over the age of 65 the most, new research from NATSEM suggests.
Changes in the 2016-17 Budget have lowered the threshold for paying tax on superannuation contributions.
Modelling from the National Centre for Social and Economic Modelling (NATSEM) says the changes will discourage some people from making voluntary contributions to their superannuation, particularly women aged 65 and older.
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I look forward to comments on all this!
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David.
