Subject:
Budget 2007
E&OE...
KOCH:
So what does it really mean for you? Let's ask the Prime Minister John Howard. Prime Minister, good morning to you.
PRIME MINISTER:
Good morning David.
KOCH:
More tax cuts, which is terrific. Centrepiece of the Budget. A lot of concern from markets and the economists, the impact of pushing up interest rates. Do you reckon you've balanced that up okay?
PRIME MINISTER:
I think we've got the balance right David. It's a very important balance, but there is still a very healthy surplus - one per cent of GDP - and this is the 10th surplus Budget of the Coalition and when he gave his testimony to the House of Representatives in February of this year, the Governor of the Reserve Bank, said that at present fiscal policy which is the thing that determines whether there is upward pressure on interest rates was not causing the Bank any concern at the present time and there certainly has been no relaxation of fiscal policy in this Budget. So our judgement and we believe the judgement of a large number of economists is that we have struck the right balance. But it is a delicate balance. Unlike our opponents of course we run surplus budgets. They used to run deficit budgets and that is why interest rates were much higher under Labor governments.
DOYLE:
All right, Prime Minister can I put a few cases to cases to you and get you to explain what they mean for the people involved? We've had an SMS from a family. "My husband and I would like to know what we get out of the Budget. We have two kids and a mortgage. We're a one-income family and earn under $100,000 a year. What do we get?"
PRIME MINISTER:
Well this year they would get, they get the tax cut of $14 a week. Say they are under $100,000 well I assume that they are somewhere in the order of $60,000 or $70,000 a year. They would get the tax cut of about $14 a week. They would get the lump sum child care payment in September or October in relation to their child care, if there are child care expenses. I don't know whether there are in relation to them or not. It depends on what their personal arrangements might be. If there are childcare expenses, perhaps there aren't. On top of that of course if, once again depending on what their income is, if it's below about $57,000 a year they would get the additional help in relation to the superannuation co-contribution. Without knowing exactly what their income is because these income levels affect entitlements; without knowing whether or not they're paying any child care expenses, if they are one-income family, perhaps they are not. But so it really depends on what the detail of their circumstances might be but they would certainly get the tax reduction.
DOYLE:
All right. Fantastic. Now look I know these are fairly general and exact specifics will make a difference....
PRIME MINISTER:
Yes you really have to know, you have to know whether there is there is child care, you have got to know the exact level of income and so forth before. But certainly everybody gets a tax cut. Once you get beyond about $45,000 a year, it's a flat amount of about $14 to $16 a week. If you have a smaller income than that, well the tax cut can be up to $21 a week because you get the benefit of the Low Income Tax Offset which phases out at a certain level. I know it is complicated but it just depends on your particular circumstance.
KOCH:
Yeah. And it's a good win for families; good win for singles as well. What about pensioners though because we often get feedback from viewers who are pensioners saying