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The Morrison Government will increase funding to corporate and bank supervisors by $ 550 million when it introduces a pre-election budget that may include tax cuts and business expenses. 39, infrastructure, as well as a surplus in 2019-2020.
As part of the response to the Hayne Royal Commission, the government will allocate an additional $ 400 million to the Australian Securities and Investments Commission and $ 150 million to the Australian Prudential Regulation Authority over the next four years. .
The government will also allocate $ 35 million to the federal court, anticipating the actions brought by the regulator as a result of the royal commission of inquiry on banks, the funds covering the appointment of two judges, the salaries of 11 members registration and support staff and new facilities.
Judge Kenneth Hayne recommended that 24 cases of misconduct be referred to financial regulators for civil or criminal prosecution. The referrals concerned all major banks except Westpac.
Tony Abbott cut $ 120 million from Asic in the 2014 budget, a funding that was later largely reinstated by Scott Morrison as treasurer, in part by imposing a fee on banks.
At a pre-budget interview with Guardian Australia, Treasurer, Josh Frydenberg, has not ruled out postponing the current income tax cuts planned for 2022, which would cost about $ 8 billion per year. year, nor offer the voters a one-time solution. pre-election payment to boost consumption at a time when economic growth is weakening.
The second stage of the tax cuts already in force, which begin in 2022, is for taxpayers earning more than $ 90,000.
Frydenberg confirmed that the budget would indicate a surplus in 2019-2020, adding that it would be accompanied by "targeted and responsible spending", including investments in infrastructure to boost productivity growth, as well as financing. of the Royal Commission on Persons with Disabilities.
The Coalition hopes that the budget will help restore the government's political situation ahead of the May elections, but Frydenberg said he does not feel compelled to give political impetus to his first economic record as treasurer. "No. I am focused," he said.
"It has been great to work with a prime minister and a finance minister who have more experience in budgeting," said the treasurer. "My goal is to create a supportive economic environment, grow the economy, provide services and balance accounts, and the policy will do it all by itself."
Frydenberg insisted that the economy was doing well despite the weak performance of the latest national accounts figures, which confirmed growth of 2.3% in 2018 and 0.3% over the course of the year. quarter. But he acknowledged that the economy was facing emerging risks.
He said trade volumes had fallen as a result of the US-China trade war and because of lingering uncertainty about Brexit, and that growth had slowed in Japan, China and the United States. in the European zone.
"We are concerned that lower house prices will affect building approvals and declining household consumption, which is important because household consumption accounts for nearly 60 percent of GDP," Frydenberg said.
He added that the drop in real estate investment had hurt growth in December, drought affected agricultural production and floods in Queensland had not yet been recorded in the economic data.
Frydenberg said the risks would be managed as long as federal policies would give businesses the confidence to invest and trust consumers.
When asked if the government would propose income tax cuts to bolster consumer confidence, Frydenberg said the coalition was still "the party of tax cuts," but that "I do not have to do it." dismissed nothing.
He said the budget would help frame the next race "which will focus on the kind of country Australians want in the next decade."
Despite the obvious pressure for spending to be reduced to help the government's chances in the elections, Frydenberg insisted that he had backed off during the Expenditure Review Committee (ERC) process.
"Of course, there is a lot of no in the process of the ERC," said the treasurer. "I will not go into details. This ERC process was no different from the others.
"Ministers make proposals. Some are approved and others are not. It's all about what can be included in the envelope and what is in the best interest of the economy and the community. "
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