Shorten to Turnbull: here are my budget repair ideas

Bill Shorten will say in a speech that his package would save more than $80 billion over a decade. Tracey Nearmy/AAP

Opposition Leader Bill Shorten on Wednesday will propose a budget repair package worth A$8 billion over the forward estimates, as the government and Labor jostle over the nation’s finances ahead of next week’s start of the new parliament.

The eight measures, recycling policies Labor took to the election, include only one – a rise in tobacco excise, worth $4.7 billion – to which the government has agreed.

In an address to the National Press Club, Shorten will seek to go on the front foot after Malcolm Turnbull last week demanded the opposition support $6.5 billion in savings that the government will present in an “omnibus” bill. These are savings Labor banked in the budget numbers it took to the election.

The opposition says it wants to see the fine detail of the bill before signing off on it. Although there has been some argy-bargy over the savings from the Australian Renewable Energy Agency, Labor is expected to pass the omnibus bill.

Shorten will say in his speech that Labor will look “constructively” at the bill. “Our position will reflect the position we took to the election. But let’s be frank – our budget and our economy need something a lot more serious and a lot more substantial than Mr Turnbull’s stunt.”

Urging the government to accept the various Labor measures, Shorten will say his package would save more than $80 billion over a decade.

The other measures, with their savings over the forward estimates, are:

  • reform of negative gearing and capital gains tax ($1.9 billion);

  • $8000 annual cap on VET FEE-HELP loans ($380 million);

  • changes to private health insurance rebate to remove natural therapies and the like ($309 million);

  • continuing the pause on indexation of the Medicare levy surcharge and the private health insurance rebate tiers for five years (no savings over the forward estimates but nearly $2.3 billion over ten years);

  • extending existing freezes on family payments thresholds to 2019-20 ($162 million);

  • capping deductions for managing tax affairs at $5000 ($295 million); and

  • opposing the return of the baby bonus ($362 million).

Shorten will call on Turnbull “at the beginning of the new parliament … to help set a new tone”.

“Put the nation ahead of partisan politics, join with me in locking in these changes with lasting benefit to our nation’s bottom line,” he will say.

“Have the courage to lead your party. Be big enough to stand up and say, ‘these are good policies, that will help the budget – let’s put the campaign aside and adopt them’. Recognise that this is fair dinkum fiscal repair that is both urgent and achievable in the 45th parliament.”

Shorten will claim that if the government supported his measures “you won’t hear me jeering about backflips and backdowns”.

He will also keep up his attack on the government over Medicare, saying this was the biggest issue of the election campaign and protecting Medicare must be a priority for this parliament.

He will say that despite what Turnbull said about wanting Australians to believe that commitment to Medicare is bipartisan, “there’s been no shift in the government’s plans to hollow-out Medicare”.

An Essential poll released on Tuesday had health at the top when people were asked which of a list of issues were the most important for the federal government to address over the next 12 months. Improving our health system (45%), was followed by national security and terrorism (37%), and – each on 31% – reducing unemployment, tax avoidance by big companies, and housing affordability.

In a taunt at the opposition leader over budget repair this week, Finance Minister Mathias Cormann said: “Will Bill Shorten step up to the plate on budget repair in this parliament? Or will he be like jelly on that plate – the Wibble Wobble Wibble Wobble Jelly on a Plate, first opposing, then supporting, then not knowing what to do?”