Howard to blame for horror budget: Swan

Single age pensioners and new parents will be among the few winners in a budget
expected to inflict pain on Australians across the board.
Prime Minister Kevin Rudd and Treasurer Wayne Swan spent budget eve blaming the
Howard government's decade of "unsustainable" spending as partly to blame for the
horror budget to be unveiled on Tuesday night.
Mr Rudd said the previous government's spending and the global financial crisis
meant the government needed to continue investing in short-, medium- and long-term
infrastructure building to support jobs.
"All to support jobs, apprenticeships and training opportunities while building and
investing in the nation-building infrastructure we need for tomorrow," Mr Rudd said.
"That's our strategy. We think it's the right strategy for Australia."
Mr Rudd said that without the nearly $90 billion spent by the government stimulating
the economy since October, Australia's forecast jobless rate would be 10 per cent
instead of the expected 8.5 per cent.
The government is expected to unveil all manner of nasties in the form of cuts to
welfare, health and other programs in a bid to wind back spending in the face of a
massive drop in government revenue expected to reach $200 billion.
But it is also expected to increase spending on job training, large scale
infrastructure projects, and research and development.
Opposition Leader Malcolm Turnbull rejected Labor's attempt to blame the former
Howard government for the state of the nation's finances, saying the coalition
retired $96 billion of "Labor debt" after it won office in 1996.
"The Howard government used those years of strong economic growth wisely and
prudently, and that is why Mr Rudd was dealt the best hand of economic cards any
prime minister could ever ask for," Mr Turnbull said.
The government on Sunday confirmed it will introduce a parental leave scheme giving
primary carers 18 weeks of pay at the minimum wage provided they earn less than
$150,000 a year.
It has also pledged to stick by its promise to raise the pension but the increase is
expected to be confined to a $30-a-week rise for single age pensioners who receive
$569.80 a fortnight.
It is in the area of so-called middle-class welfare built up by the previous
government where Labor is expected to slash benefits to households with incomes
above $150,000 as a rule of thumb.
The reining-in of costs could also mean the spread of benefits available under the
seniors concession card, once confined to those on the age pension, could be wound
back by means testing self-funded retirees.
Already one big ticket item which is widely known and which has not been denied by
the government is the plan to means test the 30 per cent private health insurance
rebate.
Those earning $74,000 a year and families with combined incomes of $150,000 would
find the rebate tapered down the higher their earnings.
It is also mooted there will be a cut of around 7,000 to the skilled migrant intake,
a trimming of the Medicare safety net with means testing, and cuts to superannuation
salary sacrificing and government super co-contributions.
While the bulk of the Medicare safety net goes on obstetrics and gynaecology
services, a cut to subsidies would reflect the government's stated desire to crack
down on rorting by high-charging specialists.
On the positive side, the government has confirmed a decision to add cancer
treatment drugs Avastin for bowel cancer and Herceptin for breast cancer, to the
subsidy list in the Pharmaceutical Benefits Scheme.
The budget is also likely to unveil a $25 billion list of large infrastructure
projects as part of the promised third stimulus package, following the nearly $90
billion already spent on stimulus since October.
Mr Turnbull warned the government must set out a "coherent" plan for economic
recovery and the creation of jobs.
He again accused the government of having plans for "spending like Paris Hilton one
minute and then cutting back on essential services the next".
"Now that he faces a bit of rough weather, he wants to blame it all on John Howard.
Really, tomorrow night Mr Swan's got to get his story straight. That's the big
challenge for him," Mr Turnbull said.