Pre Budget 2018 and Economic Trends
- April 22, 2018
- Posted by: wpgroup
- Category: Economics, Future trends
In April the budget will be brought down by the Treasurer and we can be sure it will have election sweeteners which is common by all political persuasions. The talk of tax cuts has been muted to keep the Australian people living in hope. Whatever tax cut will be neutralised by the increased medicare levy.
Fortunately we are seeing the coffers flushed as the coal prices have improved and well ahead of the price of $55.00 factored into the last budget. This improvement will perhaps assist the chances of the budget getting into surplus sooner which is a good thing if managed appropriately.
The nonsense of 420 jobs created is merely a myth, the country is facing a serious problem with under employment. The unemployment rate would be very much higher if the 1 million or so people who have given up looking for work is factored into the mix. We have seen for the first time in over several decades part time and casual work reaching nearly 30% when it was around 10%. People are looking for extra work but employers are resisting.
The ramifications is the negative wage growth currently at 1.9% well below inflation while company profits are growing at around 24%+. Youth unemployment is in double digits in many parts of the country due to the demolition and funding to TAFE. Youth are no longer prepared for work after school through a training program, instead we have private educators who are milking the system and destroying our youth with no hope of a future.
The much bigger issued is the growth in private hire companies used to employ for low wages as employees are not paid superannuation and offered below award wages on a casual basis.
The debate about reducing corporate tax with the hope that it will create more jobs and improve wages is a fallacy. The tax cuts to business in the USA has not delivered the outcome that was forecasts furthermore, employments has not taken of with only 103,000 jobs created since. Make no mistake tax breaks will improve the bottom line of big business. In the current climate and the ballooning budget deficit it would be prudent to focus on fixing the mess and reducing the deficit.
Debt has ballooned to 243 billion and has passed through half a trillion for the first time in the history of this country and is growing. There have been severe cuts to health and education combined with cuts to pensioners and the list goes on. This is putting many families to the brink of poverty, besides it is changing the social fabric of our society. The further down side will be more theft, break ins, etc.etc. In spite of these huge cuts the budget is in a huge mess.
In conclusion the upcoming budget will no doubt have sweeteners to compensate for the brutal cuts and in readiness for the forthcoming election.