GOVERNMENT SPENDING POLICY – AUSTRALIA

No respite from bracket creep for another five years

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Original article by Adam Creighton
The Australian – Page: 1 & 7 : 21-Jul-17

Professor Bob Gregory has told a conference in Melbourne that the Federal Government appears to be hoping that increased tax revenue will restore the Budget to surplus. He also noted that it had not been able to reduce expenditure in terms of its share of GDP, although it is managing to control it. Prime Minister Malcolm Turnbull told the conference that he hopes to reintroduce legislation to have the company tax lowered to 25 per cent by the end of 2017, while he noted that the government has prevented around 500,000 taxpayers being placed in a higher tax bracket by increasing the second-highest tax threshold by $A7,000.

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, RESERVE BANK OF AUSTRALIA

Gonski win looms after $5bn deals

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Original article by Stefanie Balogh, Simon Benson
The Australian – Page: 1 & 4 : 22-Jun-17

The Australian Government has agreed to increase the value of its schools funding package from $A18.5bn to $A23.5bn to get it through the Senate. The upper house is tipped to vote on the revised package on 22 June, and the Government will need the support of at least 10 crossbenchers. However, Catholic Education Melbourne executive director Stephen Elder says Catholic schools will continue to be disadvantaged under the proposed funding model. The Catholic education sector intends to campaign against the Government in the lead-up to the next federal election.

CORPORATES
CATHOLIC EDUCATION MELBOURNE, AUSTRALIA. DEPT OF EDUCATION AND TRAINING, NICK XENOPHON TEAM, ONE NATION PARTY, AUSTRALIAN GREENS, LIBERAL PARTY OF AUSTRALIA, AUSTRALIAN EDUCATION UNION

Australia ‘must deal with quite spectacular housing bubble’

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Original article by David Rogers
The Australian – Page: 28 : 1-Jun-17

A sharp downturn in the residential property market and an economic slowdown in China are among the biggest risks to the Australian economy, according to Willem Buiter of Citigroup. The investment bank’s global chief economist warns that the Federal Government’s plans to invest $A75bn in infrastructure over 10 years will not be sufficient to offset the impact of a property market downturn. He says the Government must take action to ensure that the housing market has a soft landing.

CORPORATES
CITIGROUP INCORPORATED, THE GOLDMAN SACHS GROUP INCORPORATED, LONDON SCHOOL OF ECONOMICS, BANK OF ENGLAND, WORLD BANK, EUROPEAN COMMISSION, EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, CORELOGIC AUSTRALIA PTY LTD, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

Ratings agency warns Coalition

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Original article by Jacob Greber, Phillip Coorey
The Australian Financial Review – Page: 1 & 6 : 9-May-17

The Australian Government’s May 2017 Budget is tipped to forecast a surplus in 2020-21. However, ratings agency Moody’s Investors Service has doubts regarding the Government’s ability to meet this target, as well as the economic growth forecasts in the Budget. Marie Diron of Moody’s says the firm will consider all aspects of the Government’s Budget consolidation policy over the next five years. She adds that the Australian economy’s trend growth is unlikely to be any higher than 2.75 per cent.

CORPORATES
MOODY’S INVESTORS SERVICE INCORPORATED, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. PRODUCTIVITY COMMISSION, AUSTRALIAN BANKERS’ ASSOCIATION, RESERVE BANK OF AUSTRALIA

RBA: road and rail a house price fix

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Original article by Jacob Greber, Mark Ludlow
The Australian Financial Review – Page: 1 & 4 : 5-May-17

The Australian Government’s May 2017 Budget is tipped to include funding for road and rail infrastructure, as part of its policy on housing affordability. Reserve Bank governor Philip Lowe says improved transport infrastructure is the best way to making housing more affordable. He adds that the Australian Prudential Regulation Authority’s move to crack down on lending to property investors is intended to provide "breathing space" to allow the supply-demand imbalance to correct itself, rather than being aimed at reining in house price growth.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

PM steals Gonski away from Labor

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Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 4 : 3-May-17

The Australian Government has asked David Gonski to undertake a second review of school funding, after announcing that it will adopt the needs-based funding model that he had recommended in 2011. The Government had previously resisted the needs-based model, which had been backed by the former Australian Labor Party government. Education Minister Simon Birmingham has advised that government funding for schools will increase by $A18.6bn over the next decade.

CORPORATES
AUSTRALIA. DEPT OF EDUCATION AND TRAINING, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIAN LABOR PARTY, NEW SOUTH WALES. DEPT OF EDUCATION AND COMMUNITIES, VICTORIA. DEPT OF EDUCATION AND TRAINING, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL CATHOLIC EDUCATION COMMISSION

Badgerys airport plan: build, operate and sell

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Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 6 : 3-May-17

The Australian Government’s May 2017 Budget will include funding for the proposed Western Sydney Airport at Badgerys Creek, which is slated to cost between $A5bn and $A6bn. The Government has also signalled that it will seek a buyer for the new airport after it becomes operational. Prime Minister Malcolm Turnbull has emphasised the airport’s contribution to the economy and growth in jobs. Australian-listed Sydney Airport has ruled out developing the airport, citing the high level of risk associated with the project.

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, SYDNEY AIRPORT – ASX SYD, KINGSFORD SMITH AIRPORT, AUSTRALIA. DEPT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT, AUSTRALIA. DEPT OF THE TREASURY, NEW SOUTH WALES. DEPT OF PREMIER AND CABINET, AUSTRALIA. DEPT OF FINANCE, NBN CO LIMITED

Budget debt will finance airport, rail

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Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 6 : 28-Apr-17

Prime Minister Malcolm Turnbull has identified the proposed inland rail link between Melbourne and Brisbane as a "very high priority". He has also given indications that the rail link and Sydney’s second airport will be at least partially funded by the government via "good" debt. The May 2017 Budget will make a distinction between "good" and "bad" debt. Treasurer Scott Morrison notes that while the former generates income that can be used to repay debt, the latter is still needed to provide essential services.

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. DEPT OF HUMAN SERVICES. MEDICARE AUSTRALIA, AUSTRALIAN LABOR PARTY, RESERVE BANK OF AUSTRALIA, NBN CO LIMITED, AUSTRALIA. DEPT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT, SYDNEY AIRPORT – ASX SYD

Forecast tax take out by $30bn

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Original article by David Uren
The Australian – Page: 2 : 13-Jan-17

The Parliamentary Budget Office has released its review of the Australian Government’s mid-year budget update. It shows that the forecast for revenue from personal income tax was $A21.1bn lower than in the May 2016 Budget, while company tax revenue was scaled back by $A6.7bn. Meanwhile, the budget update included savings of some $A10bn due to a reduction in the forecast cost of age pensions, carers’ payments and childcare subsidies. The forecasts for spending on health and education were largely unchanged from the Budget.

CORPORATES
AUSTRALIA. PARLIAMENTARY BUDGET OFFICE, AUSTRALIA. DEPT OF HUMAN SERVICES. CENTRELINK

Smelter’s future hanging on power supply deal

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Original article by Pia Akerman, Tessa Akerman
The Australian – Page: 2 : 22-Dec-16

The Federal and Victorian environment ministers, Greg Hunt and Wade Noonan, have held talks with Alcoa CEO Roy Harvey in New York. Harvey declined to make a commitment regarding the future of the Portland aluminium smelter, despite being offered some $A230m worth of federal and state financial assistance to keep the plant open. He said the smelter’s fate depends on the outcome of negotiations with AGL Energy regarding a new power supply agreement.

CORPORATES
ALCOA INCORPORATED, AUSTRALIA. DEPT OF INDUSTRY, INNOVATION AND SCIENCE, VICTORIA. DEPT OF ECONOMIC DEVELOPMENT, JOBS, TRANSPORT AND RESOURCES, AGL ENERGY LIMITED – ASX AGL, AUSTRALIA. CLEAN ENERGY FINANCE CORPORATION, AUSTRALIAN GREENS, AUSTRALIAN WORKERS’ UNION-FEDERATION OF INDUSTRIAL, MANUFACTURING AND ENGINEERING EMPLOYEES, KEPPEL PRINCE ENGINEERING PTY LTD