• Federal Treasurer Joe Hockey delivers his first budget in the House of Representatives (AAP)
Major changes to education, health and welfare have been outlined as part of the Abbott Government’s first federal budget.
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13 May 2014 - 8:20 PM  UPDATED 14 May 2014 - 12:15 AM
  • Government wants to press ahead with the abolition of the carbon and mining taxes
  • Medicare co-contribution fees of $7 introduces
  • 16,500 public services jobs and 230 programs abolished
  • Budget 2014: Hockey outlines federal budget

Major changes to education, health and welfare have been outlined as part of the Abbott Government’s first federal budget.

A $7 co-contribution fee for Medicare will be introduced.

Changes to the age pension were also highlighted, while young welfare recipients will be forced to wait for support under widespread shake-up of the welfare sector.

Treasurer Joe Hockey defended the budget when addressing media inside the lock up, stating that "it was important that people understand that there is a cost associated with delivery of a surplus".

"Currently it’s a taxpayer cost," he said.

Mr Hockey said the budget deficit was estimated to fall from its current $49.9 billion to $29.8 billion next year due to a series of savings measures, including a freeze on MPs and senior public servant salaries.
Health

A $7 co-contribution fee for Medicare will be introduced, and an indexation freeze will apply for the Medicare safety net threshold.

Patients with concession cards and children under 16 will have their contributions capped at 10 visits.

The budget also outlined a $20 billion Medical Research Future Fund, described by Treasurer Joe Hockey as the "biggest medical research endowment fund" in the world within six years. He wants to fund the research centre using money from savings in the health portfolio.

The fund is expected to be established by January 2015.
Tax

The Abbott Government will introduce a temporary deficit levy this year, targeting high wage earners until June 2017.

From July, the Temporary Budget Repair Levy will effectively increase the top marginal tax rate by two percentage points for people earning more than $180,000 a year.

People with a taxable income of $200,000 will pay $400, while people earning $300,000 will pay $2400.

Karen Middleton speaks with Joe Hockey



The fuel excise will be reintroduced, earning the government an estimated $168 million in 2014-15.

The government wants to press ahead with the abolition of the carbon and mining taxes, despite opposition from Labor and the Greens.

About 800,000 businesses will receive a cut to company tax of 1.5 percentage points.
Immigration

Australia’s immigration services are set to be overhauled as the government faces millions of dollars in expenditure.

The Department of Immigration and Border Protection will spend $281.5 million over the next four years, growing from costs of $65.6 million in the coming financial year to $84.9 million in 2015-16.

The government will commit $711 million over six years to border management, which will help fund the establishment of the Australian Border Force.

A total of 4000 places allocated to asylum seekers arriving by boat under the Migration Program will be axed, resulting in no growth on figures from 2013-14 at 190,000 places.

The government is also due to make savings through renegotiating contracts with offshore detention centre service providers, estimated at cutting $77.5 million from the budget over five years.
Welfare

Older Australians will be working for longer and young welfare recipients will be forced to wait for support under widespread changes to the welfare sector.

The Abbott Government will begin increasing the qualifying age for the age pension from 2025 to its target of 70, while changes to Youth Allowance and Newstart payments will mean Australians under 30 years of age will be "earning or learning".

Unemployed people under 25 will get Youth Allowance instead of Newstart, while all recipients of both payments aged under 30 will have to wait six months before receiving payments.

The government is also expecting major savings through changes to the Family Tax Benefit scheme.

Eligibility for the Family Tax Benefit Part B will be tightened, reducing the primary earner income limit from $150,000 to $100,000 per year from July 2015. Payments will also be limited to families whose youngest child is younger than six years old, in an attempt to increase workforce participation among parents.

A new annual payment of $750 will be made to low-income families who have a child aged between 6 and 12.
Education

From January 1 in 2016, higher education providers in Australia will be able to set their own tuition fees for the course they offer.

Existing arrangements will remain in place until the end of 2020 for students already paying fees.

Commonwealth scholarships for disadvantaged students will be funded by the changes, with 20 per cent of additional revenue raised by institutions to be committed.

Changes to HELP debt will also come into effect on from July 1, 2016, when graduates earning more than $50,638 will have to start repaying student debt.

Karen Middleton speaks with Chris Bowen



Students will fork out more when the government changes the rate at which they pay back their student loans.

Instead of remaining linked to the inflation rate, the government will lend money to students at a rate that reflects the cost of government borrowings to fund their student loans, with a maximum rate of 6 per cent.
Public broadcasters

Prime Minister Tony Abbott has broken a key election promise with public broadcasters to face cuts in the wake of his government’s first federal budget.

Funding to both the Australian Broadcasting Corporation (ABC) and the Special Broadcasting Service Corporation (SBS) will be cut under the Abbott Government, which has proposed a one per cent reduction in the base funding.

The measure translates into a loss of $8 million in funding over four years for SBS and $35.5 million for ABC.

The Australia Network will also be axed.
Indigenous issues

The Government hopes to save over $500 million over the next few years by merging over 150 Indigenous programs and services into just five, to be controlled by the Department of Prime Minister and Cabinet.

The Abbott Government will not cease funding the Australia’s peak body for Indigenous people. Budget figures show the government hopes to save $15 million over three years by cutting off funding to the National Congress of Australia’s First Peoples.

More than $50 million will be spent on improving policing in remote Aboriginal communities in Queensland, South Australia, Western Australia and the Northern Territory.

The government’s Remote School Attendance Strategy will continue to get funding to the tune of $18 million over the next few years.

Reaction to Budget 2014: Brian Thomson reports.



A total of $26 million will be spent on improving Indigenous teenage sexual and reproductive health.
Public Service

An estimated 16,500 public service jobs will be cut, up from the previous government’s target of 14,000.

A total of 3000 jobs are expected to be cut from the Australian Taxation Office.

Dozens of government agencies will be abolished or merged, while key assets including the Royal Australian Mint will be sold off.
Environment

The budget outlined the establishment of a $40 million Reef Trust as part of plans to protect the Great Barrier Reef, while $525 million was committed over four years for the establishment of the Green Army of environmental volunteers.

A total of $2.55 billion was also committed to establish the Emissions Reduction Fund by July.
Additional measures

Infrastructure was also among the measures outlined in the budget, estimated to take the total investment by government to $50 billion by the end of the decade and encourage more than $125 billion in spending on new infrastructure.

The budget also included figures for the search for Malaysian Airlines Flight MH370, budgeted at nearly $90m over two years.