Budget 2019: Labor spends big in voter pitch

Leader of the Opposition Bill Shorten waits to deliver the 2019-20 Federal Budget Reply speech. (AAP Image/Mick Tsikas)

Australian opposition leader Bill Shorten has put healthcare, apprenticeships and tax cuts for lower-paid workers at the centre of his electoral pitch as the Australian Labor Party sought to outbid the federal government’s budget measures in its appeal to voters.

In reply to the federal budget earlier this week, Opposition Leader Bill Shorten’s speech has laid the ground not only for fiscal policy, but also for a hard-fought campaign as Australia heads towards an election.

Central to Labor’s plan is the reallocation of the government’s proposed tax cuts away from higher income earners to an estimated 3.6 million lower-paid workers.

The Opposition would do this by rejecting the second stage of the government’s tax cuts, planned to begin in July 2022.

Labor would scrap A$143 billion in stage two and stage three tax cuts, which the government says would lower the tax rate for more than 1.1 million people earning between A$90,000 and A$120,000 per year.

Flatter tax system

Labor has already rejected the stage three cuts, proposed to start in 2024, to create a flatter tax system in which a worker earning A$45,000 per year would pay the same rate of tax as another on A$200,000. 

This government proposal would mean that more than 90 per cent of Australian workers would pay the same rate of tax.

“We won’t back a tax plan that gives a retail worker on A$35,000 less than A$5 a week while an investment banker pockets more than A$11,000 a year,” Shorten said in his budget reply delivered on 4 April 2018.

Instead, the tax relief would be targeted towards lower-paid workers, with 3.6 million workers earning under A$48,000 per year, the majority of them women, receiving deeper tax cuts under Labor than the Coalition plan.

Where a worker earning A$37,000 per year would receive a A$255 tax cut under the Coalition plan, under Labor their tax cut would be A$350.

For those on incomes of between A$37,000 and A$48,000, the maximum rebate under Labor would be A$1080 compared with A$580 under the Coalition.

Tax cuts for lower-paid workers

These tax cuts for the lower paid would be enacted immediately, Shorten said, adding that overall 10 million Australians would receive either the same or a bigger tax cut under Labor.

A Labor Government would pocket an estimated A$150 billion from not implementing the government tax plan, and this would be used to pay down government debt.

The other main theme in the Labor leader’s speech was healthcare, and specifically cancer care and treatment. The Opposition is pledging to spend A$2.3 billion over four years to guarantee free or low-cost treatment for cancer sufferers.

The A$2.3 billion would be used to make diagnostic imaging free, and it would also fund free consultations with oncologists and surgeons. 

All cancer drugs listed under the Pharmaceutical Benefits Scheme would also be available free of charge.

Medicare reform

Calling this the most important reform to Medicare since it was introduced as a universal scheme by the Hawke Labor Government in 1984, Shorten said it “should be your Medicare card, not your credit card, which guarantees access to quality healthcare”.

A third key plank of Labor’s budget plan is a A$1 billion boost to vocational training and the TAFE (technical and further education) system, which Shorten said would create 150,000 new apprenticeships.

This would include covering upfront fees for 100,000 vocational students, up to 20,000 of whom will be in the aged and disability care sectors.

“We will help train 150,000 apprentices for the jobs of the future, and we will provide additional support for the businesses which take them on, both young people and mature-aged workers looking to retrain and to learn new skills,” Shorten said.

In its budget, the government pledged to create up to 80,000 apprenticeships by funding payments to employers.

Read next: Federal Budget 2019: more winners than losers


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