It’s the make-or-break Budget that will finally nail what the upcoming federal election means to Australian families.
And already, both sides of politics are agreeing that helping families cope with rising prices – food bills are predicted to soar by up to seven per cent this year – will be the main battle ground.
Household budgets – usually considered a key element of how women cast their votes – will be under the spotlight in coming weeks.
But the divide between Labor and the Liberal Coalition now looks more profound – with the Morrison government going for caution because of the current economic climate, while Labor are suggesting there is room for investment and quality of life considerations.
The cost of living cannot just be attributed to normal inflation, which sat at 3.5% in the 12 months to the December 2021 quarter. Russia’s invasion of Ukraine, which has affected the supply chain and caused disruption.
Federal treasurer Mr Josh Frydenberg has assured Australians that Russia’s invasion and the recent east coast flooding will not halt Australia’s post-pandemic economic recovery.
So with the cost of goods and services increasing, can Australians expect any relief in the budget?
One-off cash payments of $200-$400
Whilst it has not yet been confirmed, it is likely that millions of Aussies will receive a one-time cash payment of between $200 and $400 to help address the rising cost of living. Seven News political editor, Mr Mark Riley told Weekend Sunrise that the cash payment was likely to be around $250.
Previous recipients of bonus payments have been Aussies receiving income support payments, those getting family assistance payments, veterans, concession and health card holders and students receiving ABSTUDY or a Farm Household Allowance.
Tax cuts for women under 25
Australians earning up to $37,000 can expect to be $255 better off due to the LMITO (Low and Middle Income Tax Offset). Those earning up to $48,000 will have an extra $255 plus 7.5 cents in every dollar above $37,000 and Aussies earning between $48,000 and $90,000 will have an extra $1,080 in their pocket.
Women under 25 are expected to be the main beneficiaries if the LMITO is extended again like it was in 2020 and 2021 because of the pandemic.
Fuel excise cuts
The cost of fuel is over $2.20 in some parts of the country with the government under mounting pressure to address the cost of living. The fuel excise accounts for 44 cents of the cost. Whilst it has not been confirmed, Prime Minister Mr Scott Morrison has hinted that it could be slashed in next week’s budget.
Parents with two or more children under the age of five will pay less in childcare. Currently the government allocates $10.3 billion to childcare and that is expected to increase to $12 billion in this year’s budget.
The subsidy cap of $10,560 for families earning more than $189,390 will be removed, which will lead to them being better off. The changes target low and middle-income families, with around half having a household income of under $130,000.
The government has announced the establishment of Family Home Guarantee, which will give 10,000 guarantees over four years to single parents with children. The parents will be able to purchase a home with a deposit of 2%, while the government will guarantee the other 18% that is normally required for a home deposit.
The government will also increase the First Home Super Saver Scheme, which will allow Australians to access $50,000 instead of $30,000 to buy a property.
It is anticipated that defence spending will account for 2.1% of GDP, with Prime Minister Mr Scott Morrison announcing $10 billion over two decades for a submarine base on the east coast of Australia. A further $4.3 billion will be invested in the construction of a new dry dock facility in Western Australia and $282 million in the Northern Territory for 34 capability projects.
Mental health has recently garnered the attention of politicians and is likely that $383 million will be spent on mental health and suicide prevention in New South Wales over the next five years. $128 million will be allocated to South Australia over the same period. The government will allocate $189 million to increase early intervention in family, domestic and sexual violence over the next five years and $104 million will be allocated to preventative measures.
The government has also committed $61.2 million to cancer research and the development of drugs through the Australian Genomic Cancer Medical Centre.