Federal public service boom

Original article by John Rolfe
Herald Sun – Page: 8 : 13-May-21

The May 2021 Budget papers show that the ranks of the federal public service will swell to 174,300 in 2021-22, with almost 5,400 new staff to be recruited during the coming financial year. Government agencies that are taking on additional staff include the Australian Commission for Law Enforcement Integrity and the Productivity Commission. Public servant numbers peaked at 182,500 under the former Labor government, and the Coalition had reduced this to 165,600 by 2015-16. The public service’s operating expenses will rise from $76bn in 2020-21 to $78.1bn.

CORPORATES

Battle over high-income tax cuts

Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 6 : 13-May-21

Treasurer Josh Frydenberg has defended the decision to extend the low and middle income tax offset for another year in the May 2021 Budget. He argues that the tax offset will support aggregate demand and job creation, while he has not ruled out extending it again if circumstances warrant such a move. However, Frydenberg contends that the tax offset was never intended to be permanent and must end before the legislated stage-three income tax cuts take effect in 2024. Labor has not yet committed to supporting the tax cuts, which will benefit people on high incomes in particular.

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AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY

Nursing home reforms set to raise standards

Original article by Andrew Tillett
The Australian Financial Review – Page: 13 : 13-May-21

Changes announced in the May 2021 Budget will shift aged-care funding out of the hands of providers and give older Australians greater choice of nursing homes. Aged-care experts contend that this will increase competition in the sector and force poorly-performing aged-care facilities to lift their standards. Aged-care homes will also be required to provide each resident with a minimum of 200 minutes of care each day from October 2023. However, unions contend that the sector will continue to face staff shortages unless the government takes action to increase the wages of aged-care workers.

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AAA rating likely to be downgraded

Original article by Michael Read
The Australian Financial Review – Page: 15 : 13-May-21

S&P Global Ratings placed Australia’s triple-A credit rating on negative outlook in April 2020, in response to the COVID-19 pandemic. The Commonwealth Bank has warned that Australia could potentially be downgraded to AA+ when S&P undertakes its annual review of the nation’s credit rating in September. Fixed income strategists Philip Brown and Martin Whetton attribute this to Australia’s rapidly growing net debt. However, ratings agencies are generally positive about Budget measures aimed at further stimulating the economy.

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S&P GLOBAL RATINGS, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Budget 2021: Stock winners and losers

Original article by David Rogers
The Australian – Page: 24 : 13-May-21

Macquarie Equities has identified stocks that are likely to benefit from measures in the federal government’s May 2021 Budget. The extension of the instant asset write-off for businesses should boost the sales of companies such as JB Hi-Fi and Wesfarmers, while CSR, CIMIC and Seven Group are among the stocks that should benefit from the government’s move to ramp up infrastructure investment and provide further stimulus for the housing sector. Meanwhile, travel-related stocks were sold down on 12 May after the government signalled that Australia’s international borders will not re-open for some time.

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JB HI-FI LIMITED – ASX JBH, WESFARMERS LIMITED – ASX WES, CSR LIMITED – ASX CSR, CIMIC GROUP LIMITED – ASX CIM, SEVEN GROUP HOLDINGS LIMITED – ASX SVW, MACQUARIE EQUITIES LIMITED

‘Completely excluded’: budget delivers $58.6m to media but ABC misses out

Original article by Amanda Meade
The Guardian Australia – Page: Online : 13-May-21

Former ABC bureaucrat Michael Ward has criticised the lack of funding for the public broadcaster in the federal government’s May 2021 Budget. He contends that the ABC is among the few media companies that are excluded from the $58.6m funding package. Amongst other things, SBS will receive a $30m funding boost, some $8m has been allocated to community broadcasting and the privately-owned AAP newswire service will receive $15m. The Australian Communications & Media Authority will receive an additional $4.2m to implement the news media bargaining code.

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AUSTRALIAN BROADCASTING CORPORATION, SPECIAL BROADCASTING SERVICE (SBS), AUSTRALIAN ASSOCIATED PRESS PTY LTD, AUSTRALIAN COMMUNICATIONS AND MEDIA AUTHORITY

Iron ore fear tax helps to boost budget

Original article by Ronald Mizen
The Australian Financial Review – Page: 8 : 14-Dec-20

The federal government’s Mid-Year Economic and Fiscal Outlook will reflect the surge in the price of iron ore since it handed down the Budget just two months ago. Its forecasts were based on an iron ore price of just $US55 per tonne free-on-board; the steel input is currently fetching around $US152 per tonne free-on-board, and the spot price has reached a seven-year high. Meanwhile, Deloitte Access Economics now expects 2020-21 GDP to be $33bn higher than had been forecast in the Budget, while the firm says the underlying cash deficit could be up to $3bn better than had been expected in October.

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DELOITTE ACCESS ECONOMICS PTY LTD

Pressure to extend wage plan to all ages

Original article by Geoff Chambers, Ewin Hannan
The Australian – Page: 6 : 12-Oct-20

Prime Minister Scott Morrison says the federal government will not agree to any concessions to get its JobMaker wage subsidy scheme through Parliament. Labor and the Senate crossbenchers have expressed concern that the scheme could be rorted and is too focused, given that it is only available to employers who hire people aged up to 35. Shadow treasurer Jim Chalmers says the JobMaker scheme leaves 928,000 older Australians "in the lurch", and says the existing incentive scheme for employing people aged 50+ has been a "monumental failure". Unions have warned that the government’s wage subsidy scheme for apprentices could also be exploited.

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AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIAN LABOR PARTY

Cash to go: the tax cuts start to flow

Original article by Greg Brown
The Weekend Australian – Page: 1 & 7 : 10-Oct-20

The omnibus bill containing the federal Budget’s key tax measures was passed by both houses of Parliament on 9 October. The stage-two income tax cuts are expected to begin flowing through to workers’ take-home pay in November, after the Australian Taxation Office adjusts its withholding tax schedules. The omnibus bill also provides tax relief for corporate Australia, including a business investment allowance, a loss carry-back scheme and changes to the fringe benefits tax regime that will benefit small businesses.

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AUSTRALIAN TAXATION OFFICE

Budget updates to push growth agenda

Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 4 : 28-Apr-20

The federal government will release a statement on the impact of the coronavirus on the domestic economy when parliament resumes in May. Amongst other things, it will outline how much the government has spent on stimulus measures to date. The Coalition also intends to release new economic forecasts in June, which take into account the likely future impact of the pandemic. Labor and former Treasury official Greg Smith have previously urged the government to release an economic update in the near-term, arguing that it is too long to wait until the Budget in October.

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AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY