The headlines might look pretty, but there’s little substance behind the government’s core budget spends.
Josh Frydenberg is walking in Wayne Swan’s shoes.
In an echo of Mr Swan’s GFC cash splash – the $900 cheques to keep Australia spending in an emergency – Mr Frydenberg is giving average Australians $1080 direct deposits in July-August.
The emergency this time is both political and economic.
Politically, the Coalition obviously wants to be re-elected next month so it’s pretty much matching the opposition’s tax cut offer. (Stand by for a higher bid from Labor.)
Economically, the government is acknowledging that consumer spending is stalling. And when the consumer stalls, the economy overall is in trouble.
So doubling the cash rebate that was promised by Scott Morrison in May is most welcome and absolutely necessary.
For someone with a taxable income of $60,000 (not far off the median income), it’s the equivalent of a pre-tax wage rise of 2.7 per cent.
If the latest wages index growth of 2.3 per cent is maintained (and that’s a considerable “if”), it means the median worker would get the equivalent of a 5 per cent wage rise in 2019-20 – the first increase in average, real, take-home pay in half a dozen years.
But now the bad news: That’s all there is.
Contrary to the budget speech rhetoric, there is no “plan” for strong, sustainable economic growth.
To read the full article re-printed in JOHN MENADUE'S Pearls and Irritations Blog - click HERE