Fed: PM says he opted for $5 tax cut rather than family focus

AAP General News (Australia)
02-16-2004
Fed: PM says he opted for $5 tax cut rather than family focus

CANBERRA, Feb 16 AAP - The federal government opted for across-the-board tax cuts rather
than work and family reforms in last year's Budget, Prime Minister John Howard said today.

He was defending his government's failure to overhaul family assistance payments, childcare
subsidies and return to work benefits for mothers in the 2003 Budget.

A leaked cabinet document has revealed the government toyed with the idea of introducing
the new work and family package in last year's Budget, but failed to do so.

Cabinet instructed a taskforce to develop proposals for possible inclusion in the Budget,
including improved financial assistance at the birth of a child, stronger unpaid parental
leave provisions and measures to stop the loss of welfare benefits when mothers returned
to the workforce.

"In recent days, the opposition has claimed that the government failed to act on advice
that Australia's system of family and child care benefits requires an urgent overhaul,"

Mr Howard said in a statement.

"I reject completely the claim that the government has received advice to this effect."

He said the government made the decision to deliver the $5 a week tax cut for all workers
rather than focus on families.

"In preparing the 2003-04 Budget, after providing for a necessary additional investment
in national security and defence, it was decided that priority should be given to across-the-board
tax relief," Mr Howard said.

He said the general thrust of the advice from the work and family taskforce was that
enhancements since 1996 to the tax system, financial assistance to families, workplace
relations and child care had improved the framework within which Australians could make
choices about balancing work and family life.

Mr Howard said modelling carried out on the impact of current tax arrangements and
financial assistance for families showed the arrangements were generally adequate in supporting
choices by parents to stay at home or participate in the paid workforce and did not favour
dual-income or single-income families.

"At the government's request, options for further enhancements were referred to the
taskforce review," he said.

"The tenor of this advice was reflected in my presentation at last year's convention
of the Liberal Party in Adelaide.

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KEYWORD: FAMILY HOWARD

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