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Government advisers set the record straight



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/C3

Peter Reith

DEPUTY LEADER of the OPPOSITION PRESS RELEASE SHADOW TREASURER

A DOCUMENT OF OVER 60 PAGES ANALYSING FIGHTBACK HAS BEEN LEAKED TO THE FEDERAL OPPOSITION

GOVERNMENT ADVISERS SET THE RECORD STRAIGHT

Within 48 hours of the release of Fightback, the Government received this detailed analysis from the federal bureaucracy.

By and large, the reactions of the Government's advisers have been favourable to Fightback. This explains why the Government has been so slow in launching a detailed attack. The analysis failed to find any major flaw.

It has given the green light to some important elements in the Coalition's package. Noting the qualifications in the extensive material that has been obtained by the Opposition, the Government's analysis states that:

1 The 8% compensation for pensioners appears to be adequate. This is an important initial endorsement of the over-compensation provided in Fightback for pensioners.

2 Under the new superannuation policy, contributors will be better off - particularly low income earners.

3 The new superannuation arrangements involve possibly a lower revenue cost (a useful admission of the accuracy of Note (b), p319 of Fightback).

4 On health, it is stated that:

- the reduction of the Medicare rebate to 75% will have a similar impact as the Government's $5 benefit reduction as from 1 November 1992

- the package may benefit State governments if the anticipated reduction in the pressure on public hospitals occurs.

5 Equalising the top marginal rate and the corporate rate will cut tax avoidance.

6 On housing, the analysis notes that the HIA and ACTU have been calling for a measure by which home buyers could gain access to their superannuation savings and that it has been given serious consideration by the Housing Strategy (Issues Paper (No 3)). It may have the benefit of encouraging young people to take out superannuation and removing any existing conflict between saving to achieve home ownership and saving for retirement.

COMMONWEALTH PARLIAMENTARY LIBRARY M iC A H

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Assuming the accuracy of the HIA's estimates, the analysis states that the compensation for first home buyers is adequate.

The Government has had nearly a week now to analyse significant elements of the package and obviously would have been receiving a stream of advice from the federal bureaucracy. It is time that the Government stopped running

its scare campaign and started to acknowledge, as its advisers have done, that many benefits will flow to the Australian people as a result of the Fightback package.

28 November 1991 Canberra

D149/91

Contact: David Turnbull (06) 277 4277

NB. The Coalition will not be releasing the material provided to us for the simple reason that we are not prepared to, in any way, disclose our sources.