Source: News Limited, with The Australian

• Labor plans to scrap $500 seniors' bonus
• Follows plan to scrap $1600 carers' payment
• Blames Howard's "unsustainable spending"

THE Federal Opposition has condemned any move by the Rudd Government to scrap bonus payments to seniors.

Labor is reportedly planning to scrap a $500 seniors' bonus payment created by John Howard last year to help the over-65s deal with rising costs, despite a massive community backlash over plans to abolish the $1600 carers' payment in the May budget.

Opposition families and community services spokesman Tony Abbott today said the seniors' payments had helped more than two million pensioners last year and should be preserved.

"The Howard government thought this was an important way of allowing less well-off people to share in our economic prosperity. This was the social dividend of the economic boom,'' he said.

This year's budget surplus was predicted to be huge, he said, and it was only fair that Prime Minister Kevin Rudd give something back.

"This year, there's going to be an even bigger budget surplus - $20 billion - and yet the Rudd Government is not going to give carers bonuses and now it's not going to give seniors bonuses either,'' Mr Abbott said.

"Kevin Rudd criticised John Howard as being mean and tricky, but as soon as he gets his hands on the levers of power he starts taking things away from the most vulnerable people in society.

"Kevin Rudd has been parading his Christian virtue, yet he's taking away from the most vulnerable that little bit extra the government was giving as some way of sharing in the good times.''

Howard's fault

The Treasury yesterday said spending under the Howard government was unsustainable and likened its profligacy to that of the Whitlam Labor government.

A Treasury report provided crucial support for Wayne Swan's insistence on the need for deep spending cuts in the 2008-09 budget to ease pressure on inflation and interest rates.

"The recent growth in spending stands out, along with the growth in spending under Whitlam in 1974-75 and the increased spending following the recessions in 1982-83 and 1990-91," the Treasury report stated.

The Australian revealed yesterday that the Government planned to axe the $1600 carers' payment as part of its May budget savings.

As the Treasurer refused to confirm the plans, other government sources said the $500 seniors' bonus, created last year, was also in the budget razor gang's sights.

Sources said the Government maintained its determination to deliver all election promises, but that all Howard government programs faced a line-by-line search for spending cuts.

The carers' bonus was paid to 400,000 Australians for the past four years, providing up to $1600 each, while Mr Howard created the seniors' bonus last year at a cost of $1.3 billion.

Both payments were said to be one-off - meaning they were funded out of budget surpluses and were not written into the budget forward estimates.

Carers Australia chief executive Joan Hughes said many family carers lived below the poverty line and used the $1600 to augment their living expenses.

"It's going to be a very tough time for carers," she said.

Mental Health Council of Australia spokesman Simon Tatz said carers needed the payment to help with medication, food, transport and accessing services.

"The utilities allowance cannot substitute for what the carer bonus can buy," Mr Tatz said.

The move sparked a warning from the Australian Services Union that the Rudd Government's "social inclusion" agenda might be damaged before it had even started. The ASU covers non-government workers providing housing, counselling and other support services.

National assistant secretary Linda White said the budget would have to be carefully thought through, and that taking money from programs that helped the people on the margins of society would be counter-productive.

"Taking money out of programs in a circumstance where there is already some difficulty being experienced at the front line getting labour - there is already significant difficulty getting workers for the pay on offer - then the Government's social inclusion agenda could be in jeopardy before it starts," Ms White said.

With The Australian

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