Treasurer Says Budget 2017 Offers Fairness, Opportunity and Security

The federal government has unveiled its 2017 budget with Treasurer Scott Morrison describing it as a budget of “fairness, opportunity and security” – making housing and homelessness and fully funding the National Disability Insurance Scheme a centrepiece of its program.

The treasurer revealed an increase in the Medicare levy to fully pay for the NDIS while also delivering a crackdown on people who abuse the welfare system.

“This budget is about making the right choices to secure the better days ahead,” Morrison told federal Parliament.

“Our choices are based on the principles of fairness, security and opportunity.”

Morrison said the government had chosen to close the funding gap for the NDIS “once and for all”.

“The funding gap is currently $55.7 billion over the next 10 years. We have previously sought to close this gap with budget savings that we have not been able to get through the Parliament,” he said.

“To ensure the NDIS is fully funded we will legislate to increase the Medicare Levy by 0.5 percentage points in two years’ time, when the extra bills start coming in.

“I also announce a commitment of $80 million for Australians with a mental illness such as severe depression, eating disorders, schizophrenia and post-natal depression resulting in a psychosocial disability, including those who had been at risk of losing their services during the transition to the NDIS.”

On the housing front the government is set to replace the National Affordable Housing Agreement (NAHA) with a new set of agreements with the same funding.

“The Commonwealth will replace the National Affordable Housing Agreement that provides $1.3 billion every year to the states and territories, with a new set of agreements, with the same funding, requiring the states to deliver on housing supply targets and reform their planning systems,” he said.

“We will also establish a $1 billion National Housing Infrastructure Facility, based on a UK model, to fund ‘micro’ city deals that remove infrastructure impediments to developing new homes.

“And tonight I announce $375 million for a permanent extension of homelessness funding to the states, with a continued focus on supporting young people and victims of domestic violence.”

An online Commonwealth land registry will be established detailing sites that can be made available for residential development.

The budget also delivers a crackdown on “people trying to take an easy ride” on the welfare system.

“Those who do not meet their responsibilities and either fail to turn up to appointments or take on suitable work will face escalating financial penalties, ranging from reduced to cancelled payments,” Morrison said.

“We want to support job seekers affected by drug and alcohol abuse, but to protect taxpayers, it has to be a two-way street.

“We will no longer accept, as an excuse from repeat offenders, that the reason they could not meet their mutual obligation requirements was because they were drunk or drug-affected.

“In addition we will commence a modest drug testing trial for 5,000 new welfare recipients.”

Controversially, he said jobseeker recipients who tested positive would be placed on the Cashless Debit Card for their welfare payments and be subjected to further tests and possible referral for treatment.

Other welfare measures included: strengthening verification requirements for single parents seeking welfare, a crackdown on those attempting to collect multiple payments, stricter residency rules for new migrants to access Australian pensions, and denying welfare for a disability caused by substance abuse.

“Tonight, we put to rest any doubts about Medicare and the Pharmaceutical Benefits Scheme. We are lifting the freeze on the indexation of the Medicare Benefits Schedule,” the treasurer said.

“We are also reversing the removal of the bulk billing incentive for diagnostic imaging and pathology services and the increase in the PBS co-payment and related changes. The cost of reversing these measures is $2.2 billion over the next four years.”

He said the Commonwealth would increase hospital funding by an additional $2.8 billion over four years.

“Significantly, we will invest an additional $115 million in mental health, including funding for rural telehealth psychological services, mental health research and to prevent suicide,” Morrison said.

“We will also invest $1.4 billion in ground-breaking health research over the next four years, including $65.9 million this year, to help research into children’s cancer.

“All up, our commitments equate to a $10 billion re-investment in Australia’s health care over four years, including the $2.8 billion increase in hospital funding.”

However welfare not for profit Anglicare said the budget “forgets that we’re all in this together”.

“This year’s budget is a lost opportunity to tackle inequality. Instead, we’ve gotten another budget that pits Australians against each other,” Anglicare Australia executive director, Kasy Chambers said.

“Support payments for job seekers, pensioners, and people with disabilities have become a poverty trap. They’re so low that paying rent means you can’t then afford to buy food, clothing, transport or go to the doctor.

“This budget has frozen those payments at dangerously low levels, ignoring calls from the business and community sectors to increase them as a matter of urgency.

“Australians on low incomes are struggling to make ends meet. But instead of offering relief, people who need help from the government are being scapegoated, with the budget targeting centrelink recipients with a demerit scheme and expanding the cashless welfare trial.

“And anyone who has had much to do with Centrelink will see the irony in the demerit system. Cuts to Centrelink and its staff have led to rampant mistakes to the point where nobody could have confidence in its accuracy when doling out ‘demerit points’.

“We’re also disappointed to see another attempt to cut family tax benefits. These families were already experiencing financial stress. It is not fair to ask them to shoulder the burden of balancing the budget.”

Chambers welcomed positive aspects of the budget on housing and the NDIS.

But according to aid agencies the federal government has “raided” the Australian aid budget for the fourth consecutive year.

“Following cuts in 2014, 2015 and 2016 that take Australian aid to its lowest level ever, the government is raiding the aid budget yet again in 2017 with a further $303.3 million cut,” director of Campaign for Australian Aid, Tony Milne said.

“This is the Great Australian Raid Budget.”

Welfare peak body Australian Council on Social Service (ACOSS) has welcomed a change of tack to invest in health, education and housing, but said the 2014 budget mindset “to demonise and impoverish the most disadvantaged” continued.

“The government is trying to put the 2014 horror budget behind it, securing the National Disability Insurance Scheme and putting housing affordability on the agenda but the government still neglects, blames and targets the most disadvantaged in the social security system,” ACOSS CEO Cassandra Goldie said.

“The government’s significant change of tack on Medicare and schools funding is welcome, recognising that people value essential services. The challenge is to properly fund them.

“The government has begun to strengthen the revenue side, by increasing the Medicare levy and taking further steps to stem tax avoidance by international businesses.

Goldie welcomed what she said was the “first steps to address housing affordability”, including key elements to encourage private investment in affordable housing and secure funding for homelessness services.

“This start will only deliver for those on the lowest incomes if the next step is taken: new public investment in social housing and improved rent assistance for tenants,” she said.

“But in social security, the government remains stuck in the 2014 budget mindset that demonises and impoverishes people who are unemployed.