Australia budget 2017: Treasurer promises fairness and growth

Australia budget 2017: Treasurer promises fairness and growth

Australia budget 2017: Treasurer promises fairness and growth

The budget was the first since PM Malcolm Turnbull's government was re-elected on a tiny majority past year.

Instead it seriously antagonised a Treasurer looking for a swift, neat, way to sweep billions off his budget deficit.

The 2017 Budget also seeks to entirely recover from Labor's Mediscare campaign that almost cost the Coalition the election while tackling the Opposition's main arguments on schools' funding, training and a calls for a Royal Commission into the banks.

Schools will received $18.6 billion in extra funding.

The Treasurer was unrepentant when speaking about the new tax, which he admits will be used for budget fix after he was forced to dump more than $13 billion of "zombie" savings measures from the 2014 federal budget that had failed to pass the parliament.

Mr Morrison said: "What the commission will be doing will be keeping an eye on them to make sure they don't lie to their customers about this".

The Treasurer believes better days are ahead, thanks to an uptick in the global economy.

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Treasurer Scott Morrison said the country's profitable banks, which have been under fire in recent months amid a series of misconduct scandals, would bear the brunt of a budget "re-set" as he abandoned so-called "zombie savings" worth some A$13 billion.

According to Deloitte, the Budget balance is expected to gradually improve on the deficit of $40 billion in 2015-16, easing slightly to $38 billion in 2016-17, $29 billion in 2017-18, $21 billion in 2018-19, $2.5 billion in 2019-20 and a projected return to a small surplus of $7 billion in 2020-21.

"Around three quarters of the increase in our debt since 2007-08 has been driven by welfare, health and education spending", the treasurer said.

"I know this has put real pressure on Australians and on their families".

It has been suggested the major banks may move quickly to raise mortgage rates by up to 0.15 per cent to compensate for the budget measure.

Mr. Morrison said $6.2bn (US$4.6bn) would be raised over the next four years by the new levy on the big five - ANZ Bank, Westpac, National Australia Bank, Commonwealth Bank and Macquarie.

This will cover nearly half of the "zombie" savings measures the Turnbull Government has been unable to get through the senate.

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ABC host Michael Rowland told Mike Hosking two of the big shocks are a half a percent increase in Medicare and hitting the banks with a new levy.

Ms Bligh said it was unacceptable to keep banks and the broader community "in the dark" and has demanded to see the modelling by 5pm on Tuesday, May 16, the day before the ABA expects to see the draft legislation for the new levy.

A fee subsidy for New Zealanders is also to be ended.

The government also plans an AU$8.4 billion ($6.2 billion), 1,700 kilometer (1,000 mile) new railway corridor between Melbourne, Australia's second largest city, and the third largest city, Brisbane.

Wayne Swan, a former deputy prime minister for an opposition Labour party government, took a relatively sanguine view of the levy.

Commonwealth Bank CEO Ian Narev did not rule out a mining lobby-style public campaign against the levy when asked about it on Friday.

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