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Mining boom delivers record $22 billion surpl -

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Mining boom delivers record $22 billion surplus

Broadcast: 14/05/2008

Reporter: Hayden Cooper

Federal Treasurer Wayne Swan has posted a record surplus of $22 billion in his first Budget. It is
the bedrock that has allowed him to reward 'working families', honour the election commitments they
voted for, and still have enough to put aside for health, education and building projects.


TONY JONES: On and on it goes, the revenue flows and the bounty of a surging economy becomes the
stuff of another Budget bonanza.

Tonight, Wayne Swan has posted a record surplus of $22 billion. It's the bedrock that's allowed him
to reward so-called "working families", honour the election commitments they voted for, and still
have enough to put aside for health, education and building projects.

But the Labor Government is cutting into middle class welfare for the wealthiest Australians, as
part of a $7 billion savings drive.

Hayden Cooper reports.

SPEAKER OF THE HOUSE: I call the Treasurer.

HAYDEN COOPER: A heavy surplus to lighten the load.

WAYNE SWAN, TREASURER: Tonight, we tip the scales in favour of working families.

HAYDEN COOPER: A budget weighed down by revenue, has allowed Wayne Swan to target the battlers, and
predict a whopping surplus, almost $22 billion, or 1.8 per cent of GDP.

WAYNE SWAN: The largest Budget surplus as a share of GDP in nearly a decade.

HAYDEN COOPER: The razor gang has clawed back more than $7 billion in the next year, through cuts
and increased taxation receipts.

And one early savings surprise is found in the means testing of welfare. From January the baby
bonus will go only to families earning under $150,000 a year.

The same threshold will apply to Family Tax Benefit B, lower than expected.

WAYNE SWAN: Some Australians have been asked to bear a greater burden than others, that's true. But
in the end, if we are to beat inflation and build prosperity, we have no choice.

HAYDEN COOPER: But the spending goes on, across the spectrum, combined with a continuation of the
recent tax cut tradition.

As promised, average wage earners will be $20 a week better off from July, the high-flyers will
have to wait.

Education was a recurring theme during the campaign, tonight is no different.

The Budget delivers on a 50 per cent refund of schooling expenses, up to $750 for high school
students, $375 for primary.

At the other end of the system, there's an immediate $500 million for universities to improve their

Child care costs will be eased somewhat by a lifting of the rebate to 50 per cent of expenses, up
to a ceiling of $7,500 a year.

And on housing, Wayne Swan's setting out to make life easier for those looking to buy.

First Home Saver accounts will attract a lower tax rate of 15 per cent and for the first $5,000 the
Government will add a contribution of 17 per cent.

In all, the Treasurer's forking out $5 billion in spending next year, and the bill will be paid
courtesy of the biggest boom in trade figures for 50 years, a product of surging coal and iron ore

So the resources boom allows headroom for plenty of spending, even with the comfortable buffer of
the massive $21 billion surplus. And that posed an equally large question: What to do with all the

The answer is to invest. Labor's election rhetoric about setting the nation up for long-term
challenges rings true tonight. Three investment funds will be pumped full of cash and a mandate to
find and fund so-called "nation building" projects.

It's one Budget measure Wayne Swan is most proud of.

WAYNE SWAN: Someone said to me that there wasn't much new. What about $40 billion to modernise the

HAYDEN COOPER: The headline act is the Building Australia Fund, for infrastructure works like road
rail and ports. It'll get $20 billion.

The previous government's Education Fund gets a revamp and a bumped up balance of $11 billion for

And the new Health and Hospitals Fund will get a kick-start of $10 billion.

All the money comes from present and future surpluses.

MALCOLM TURNBULL, FEDERAL SHADOW TREASURER: This is a high taxing, hish spending budget. It is the
complete reverse, the complete opposite of what Mr Swan has been saying he would do for months and

HAYDEN COOPER: And so the journey begins. The Treasurer has overcome his biggest career challenge.
Now, for the reaction.

WAYNE SWAN: It is a Labor budget for the nation. For Australia's future and for all Australians. I
commend the Bill to the House.

HAYDEN COOPER: And he's hoping there's more than a couple to come.

Hayden Cooper, Lateline.