The government’s long awaited audit commission, containing 86 recommendations aimed at saving the budget up to $70 billion annually, was released in Canberra on Thursday.
The big savings focus was on health, the ageing and education, with recommendations to boost the pension age, introduce a $15 co-payment to see the doctor and slow the roll-out of the national disability insurance scheme.
The audit recommends lifting the pension age to 70 by 2053, including the family home in the pension assets test and increasing the superannuation preservation age to 62 by 2027.
Even Prime Minister Tony Abbott’s signature paid parental leave scheme is considered too expensive with the commission recommending it be capped at the annual average earnings rate – currently $57,460.
The government has decided to let people sweat it out for another 10 days before revealing which, if any, of the recommendations it will accept, defer or just plain reject.
Treasurer Joe Hockey has no doubt many of the recommendations of the commission of audit will be unpopular, but the federal government has to make the budget “fit for the future”.
“I have no doubt that there’ll be many issues that are highly contentious, and somewhat difficult for various stakeholder and some in the community to accept,” Mr Hockey told reporters in Canberra.
“But there is an overwhelming challenge here, and that is to ensure that the budget is structurally fit for the future.”
The audit’s broad-brush recommendations will account for 70 per cent of total commonwealth spending over the next decade.
The commission estimates total spending will balloon to $690 billion over the next 10 years, from $409 billion.
Its chairman, former Business Council of Australia president Tony Shepherd, said Australians must reassess their expectations for the overall good of the nation.
“National interest and not special interest must prevail,” he told reporters in Canberra.
Mr Abbott succumbed to backbench pressure on Wednesday by reducing the paid parental leave cap to $100,000, from $150,000.
On school funding, the commission says all responsibilities should be transferred to the states and the size of the commonwealth education department should be significantly reduced.
The commission also recommends the budget include a 10-year outlook rather than the current four, and that each new spending commitment be evaluated in that timeframe.
It also backs the government’s review of the interaction between the commonwealth and states.
Mr Shepherd said the duplication and complexities between the two were “mind-boggling”.
Finance Minister Mathias Cormann says some of the recommendations will be taken up straight away, others will be further considered, while some will be rejected outright.
“We will not be providing a detailed response to each recommendation today,” he told reporters.
“The response to the commission of audit report will be in the budget.”