Abbott dodges booby trap

Tony Abbott appears set to defy the Gillard government’s expectations and allow the axing of the baby bonus and cuts to family payments in the federal budget to pass through Parliament.

The Opposition Leader is expected to ignore one of the biggest ”booby traps” in the government’s pre-election budget and blame the the loss of almost $5 billion in payments to middle-class families over four years on Labor’s economic mismanagement.

Several Coalition MPs told Fairfax Media they expected Mr Abbott to accept the vast bulk of the budget cuts and avoid the trap of having to find additional savings to restore the payments. One said Treasurer Wayne Swan had done Mr Abbott’s work for him, adding: ”Someone had to hit middle class welfare.”

While Mr Abbott and his shadow Treasurer, Joe Hockey, ridiculed the promise of a return to surplus in 2016-17, they were more restrained when it came to the $43 billion in savings in the budget and the axing of the baby bonus introduced by the Howard government.

”What we’re not going to do is engage in the kind of knee-jerk politics designed to get a headline rather than to govern the country, and that’s been this government’s failure all along,” said Mr Abbott, who delivers his formal budget reply on Thursday evening.

Mr Hockey signalled a decision on the baby bonus would not be made quickly, saying: ”I will consult very carefully with my colleagues … We will be very, very thorough about it, and then we will announce our position before the election.”

Mr Abbott is likely to argue the axing of the bonus strengthens the case for his expensive paid parental leave scheme, which is seen by business and some of his colleagues as unaffordable.

Julia Gillard defended Labor’s decision to axe the baby bonus, declaring: ”I’ve made a values judgment that that money would be better spent making sure that that child, that new baby – indeed every Australian child – gets a world-class education.”

Finance Minister Penny Wong has challenged Mr Abbott to spell out his plans in his budget reply, saying his starting point, if he chooses not to accept any of the budget

savings, would be a $50 billion shortfall over the forward estimates.

Speculation on the Coalition’s intentions came as Mr Swan promoted the budget’s commitments to school funding and DisabilityCare, the national disability insurance scheme, and attacked Mr Hockey for repeatedly saying the budget offered no hope.

”I wonder if he’d have the guts to stand up in front of our teachers and school kids and say there was no hope for them in last night’s budget,” Mr Swan said in an address to the National Press Club. ”I wonder if he’d have the guts to say it in front of the 410,000 Australians with a permanent and severe disability. Australians expect all of the members of this Parliament to rise above the politics and make the investments we need as a nation.”

A defiant Treasurer also conceded that the budget’s failure to produce the surplus predicted in last year’s budget had hurt the government and his own reputation, but maintained he had acted in the national interest in response to changed circumstances.

”I’m happy to be judged by the people on all of those matters when the time comes.”

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