Finance Your Budget PM pushes on with loathed Abbott cuts
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PM pushes on with loathed Abbott cuts

malcolm turnbull tony abbott
With enemies like these: Malcolm Turnbull is fighting his own backbench
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The Coalition government will attempt to scale back family tax benefits on Wednesday, one of the most unpopular measures of last year’s doomed budget.

Prime Minister Turnbull has reportedly softened the cuts wanted by Abbott and Treasurer, perhaps an admission that the 2014 budget measures were too harsh — or too unpalatable.

Originally, benefit payments were to be stopped when a family’s youngest child turned six, but the ABC reported the age would be raised to 13 in the redrafted bill.

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Currently, some families receive part B payments with children aged up to 18 or 19. 

Social Services Minister Christian Porter reportedly outlined the plan to the Coalition in a party room meeting on Wednesday morning.


Scroll down for full details of the new package


Under the changes, the government would stop end-of-year supplement payments to eligible families, but will rase the base rate of family tax benefit part A by $10 a fortnight, Fairfax Media reported.

The government would phase out supplement payments across the board, saving a reported $4 billion over four years.

When probed on the issue in Question Time on Wednesday, Mr Porter accepted the Abbott government plan had insufficient support.

social services minister christian porter
Social services minister Christian Porter will introduce the scaled-back plan on Wednesday. Photo: AAP

“There are a number of measures, as you know, that were introduced as part of the budget and we know that they are unlikely to pass in their current form,” he said.

“The Minister for Social Services has been working very carefully with the Cabinet, with his colleagues, to ensure that a revised family payments reform package will strike a balance between achieving significant savings while still providing sufficient financial support to those families most in need.”

Two-parent and single-parent families with a primary breadwinner earning $100,000 or less annually can receive the payments.

The initial package from the 2014 Budget had been blocked by the Senate thanks to cross bench representatives.

It was rejected again when the Coalition tied the cuts to its $3.5 billion childcare package.

Labor is reportedly more open to the revised plan, as opposed to the complete rejection of the first.

The initial plan to cut the benefit payment was projected to generate over $1.9 billion in five years in budget savings.

The Opposition’s spokeswoman for families Jenny Macklin welcomed the news.

“It’s a big win for families,” she told ABC radio.

She did not say if Labor would support the changes.

Greens spokeswoman Rachel Siewert said the watered-down measures still disproportionately target the most vulnerable.

But the changes are needed to help fund the government’s childcare package, Finance Minister Mathias Cormann said.

“We’ve said for sometime now that our next challenge was to get our revised families package through the parliament,” he said.

Independent senator Glenn Lazurus said he was pleased with the compromise, but was still considering the changes.

Details of the governments fresh family tax package:

– Increases Family Tax Benefit Part A by $10.08 a fortnight for each child from July 2018.

– Boosts fortnightly payments for under-18s living at home on Youth Allowance by $10.44 .

– Family Tax Benefit Part B for families with a child under the age of one will increase by $1000.10 annually for each child.

– FTB Part B cut off at age 13, down from 16.

– Single parents and grandparents with a child between 13 and 16 will get a mitigating payment of $1000.10

– FTB Part A and Part B supplements will be phased out by 2018.

– $4.8 billion savings will fund government’s childcare package.

– with AAP

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