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Federal budget dismantles welfare rights, hands over government finance to corporations

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by Max O.

In line with the trend throughout the Western capitalist world, the Hockey-Abbott budget is implementing the demands of international finance capital by tearing down the poor and workers’ welfare rights, as well as the nation-wrecking sell-off of government assets.

Using the spin, that readers have become all to familiar with, ('end of the age of entitlement', 'pain with purpose', 'nation of lifters not leaners') the government has used a manufactured 'debt crisis'  to justify the enormous cutbacks to government welfare and vital public institutions. 

The real purpose of the budget cuts is to shift billions of dollars over the next couple of years from the less well-off to the wealthy, large corporations and financial institutions. It will also have an ideological function of instilling fear and misery into the poor and working class.

Hockey's budget announcements, in the main coming straight from the Business Council's and Audit Commission's wish list, amount to the following:

• It will now prevent people who are aged 30 or younger from getting Newstart (unemployment benefits) unless they’ve done an “employment services activity” for six months.

• The under 25 will have to scrape by on the pitiful Youth Allowance because they will no longer be eligible for Newstart.

• The pension age to be increased to 70 by 2035.

• From 2017 the age pension and the disability support pension will be indexed to inflation, rather than average weekly earnings and so fall behind the cost of living. 

• Family payments are to be cutback by $8 billion!

• Sole parents and stay at home parents are to be penalised. Parents (essentially women) with children over the age of six, with no regard to their circumstances, will be pushed and poked back into work.

• Through the use of co-payments Hockey has attacked the universal nature of Medicare. The sick will be hit with a $7 charge to see their GP, or get a pathology test and for X rays.

• There will be a $5 increase to the cost of every single prescription drug. This in effect is double dipping with the 'user pay' philosophy, because people already pay for their Medicare through the 1.5% tax levy.

• Reintroduction of the six monthly fuel excise indexation will raise $2.2 billion. This will go to fund road infrastructure, with public transport being overlooked.

• In fact there’s plenty of handouts to the construction companies and property developers, with $12 billion from the government thrown their way to build infrastructure for the benefit of big business - more and bigger polluting roads (like Melbourne’s East West link), ports, railways and airports. 

• University funding will suffer a massive cut, but Hockey will now allow vice chancellors to charge students whatever fees they like.

• Government contributions to HECS will shrink and repayments will start earlier and at a higher rate.

• Over the next decade the budget tears out $80bn funding to the states for hospitals and schools. This is an arrant attempt by Hockey and Abbott to push the states into agreeing to increase the unpopular GST.

• The Coalition have now blatantly reneged on the promised Gonski funding, aggravating the widening gap between private and public schools.

• A deficit tax will be levied for three years of 2% on incomes of over $180,000. This to feign the impression that all (rich and poor alike) must share the burden of the debt crisis, and predictably was disapproved by the likes of Tony Shepherd from the Audit Commission and Business Council. 

• To make co-payments more palatable finance raised from them will go to a dubious Medical Research Future Fund, which will receive $20 billion by 2020.

• Company tax to be reduced down to 28.5%, a 1.5% reduction.

• $10,000 subsidy over 24 months for businesses who employ over 50s.

Make the rich pay!
There is money to be had, but it is in the wrong hands. Governments could quite easily redress their revenue problems by making the RICH PAY! For example a proper Super Profit Mining Tax of 40% on all minerals, with a fixed state royalty and a change to depreciation would collect $35 billion straight away. 

They could also look at permanent options like trusts, superannuation tax concessions and negative gearing. The forgone tax revenue cost the budget this year $34 billion rising to over $50 billion in 2016/17.

Let’s not forget the deceitful scheme of profit shifting to tax havens by multinational corporations.  This is wealth produced from workers’ labour power that is sneaked out of the country instead of being used here to fund social programs. 

More austerity attacks to come
But of course this won't happen, because our 'parliamentary democracy' is in fact a covert capitalist dictatorship, a social and economic system that only exists to serve the needs of capital accumulation/profiteering for Australia's comprador capitalist class.

The Abbott Coalition government have just started stage one of their austerity attacks. Following stages will include increasing and extending the Goods and Services Tax (which hurt the poor and workers), more nation-wrecking privatisation and further outsourcing of public sector services, and vicious attacks on minimum wages and worker rights.

Rely on the people!
By now many people don't have faith in parliamentary parties and are beginning to lose faith in parliament itself because of its perpetual service to capitalism and the continual neglect of their needs. Resistance to this budget and other attacks on the working class can best be sustained through workplace and community based organisation. 

Mass/participatory democracy is the weapon that ordinary people can use in their workplace, suburbs and the streets to start the fightback against this budget and parliament that has declared class war on them.


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