A package of support:
The Working Families Support Package targets the things that put most pressure on family budgets housing, child care, education expenses, and petrol and grocery prices and reduces the burden of tax on families.
Patrick and Susie have two small children, Josh is 6 years old and Megan is 4. Patrick works full time and earns $60,000 a year and Susie has recently returned to paid work at three days per week, earning $27,000.
Thanks to the Government's Working Families Support Package, Patrick and Susie will be around $4,160 a year or $80 a week better off for 2008‑09. Megan's child care costs and Josh's after school care costs will be reduced by $1,255 due to the increase in the Child Care Tax Rebate from 30 to 50 per cent. Receiving the rebate quarterly will also make their family's budgeting easier. The new Education Tax Refund will help to buy a computer and children's educational software for Josh who is at primary school.
Importantly, Susie and Patrick will keep more of what they have earned from their days at work. The Government's tax cuts will reduce their family's tax bill by $1,050 in 2008‑09.
Susie and Patrick have started saving to buy their first home, but it seems like it will be years before they can raise the deposit.
The Government's First Home Saver Accounts (FHSAs) will help them save for their own home, with the Government contributing 17 per cent on the first $5,000 of contributions that they each make into their individual accounts each year. Susie and Patrick set aside 10 per cent of their combined earnings into their FHSAs in 2008‑09 ($8,700, split evenly between their FHSAs). For Susie and Patrick this will mean around $1,480 of Government contributions will go towards saving for their own home. After 5 years of such saving they will have a combined balance of around $64,800 for their own home and be around $10,100 better off than if they had used term deposits with the same 7 per cent earnings rate and the same contributions.
In the meantime, the Grocery Price Inquiry and the National FuelWatch Scheme will also help Susie and Patrick get a better deal at the checkout and bowser.