By SONJA KOREMANS
SMALL businesses, families and pensioners will be at the centre of this year’s Federal Budget to be handed down next week.
Already we know there will be a “families assistance package” targeted at working parents paying for childcare, and a small business tax cut.
Plans are also locked in to tighten access to the pension, which is set to scale back payments for hundreds of thousands of older Australians.
The government has hinted that Tuesday night’s budget won’t seek to protect federal coffers at the expense of households, with Tony Abbott calling it “dull and routine”.
What that really means is the government must emerge with a budget it can sell, after the furious reaction to last year’s effort.
Some economists say the budget will be anything but routine.
Flat wages growth and sliding iron ore prices have left a multi-billion dollar hole in federal revenue, with predictions the government will sink $14 billion deeper into deficit next financial year.
Deloitte Access Economics partner Chris Richardson said key contributors to the budget blowout included the retreat of the Chinese commodity boom, shortcomings of the domestic political climate and the resulting gridlock in the senate on a range of savings measures.
“We still see deficits as far as the eye can see, with the repair task getting harder both because of economics – commodity prices and wages – and because of politics,” Mr Richardson said.
