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Has Hockey bowled up a winner?


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They’ll say otherwise, but Joe Hockey and his ministerial colleagues are like a cricket side in the field – crouched in the slips waiting for the next round of opinion polls and confidence gauges.

But it will take a few months to determine whether they have caught the imagination of voters and found lasting support for the treasurer’s second budget.

While it’s been portrayed as a softer and cuddlier budget, after Hockey’s harsh and brash version 12 months earlier, acceptance is not guaranteed.

Two consumer confidence readings due next week – one weekly and one monthly – will provide an initial gauge of reaction.

Commonwealth Securities economist Savanth Sebastian says the lack of “nasties” in the budget should provide some comfort for consumers.

But it might be relief rather than people jumping for joy.

Already there are grumblings over Hockey’s move to end “double dipping” of paid parental leave from July 2016.

The treasurer suggests new mums were doing something untoward – even illegal – by getting benefits from both the government and employer schemes.

The much-touted family package that includes changes to childcare funding is partly paid for by 2014 budget measures to cut family benefits, which are still meeting opposition from a hostile Senate.

Changes to pensions that caused so much angst last year have been watered down.

The other big ticket item in the budget, the jobs and small business package, has been met with rapturous applause by the sector.

They’re now known as “Tony’s Tradies”, supposedly Prime Minister Tony Abbott’s equivalent of Howard’s battlers.

The package is largely paid for from Abbott’s own generous paid parental leave scheme that he was forced to ditch earlier this year.

It provides a 1.5 per cent tax cut for small businesses that pay corporate tax or a five per cent tax discount if they don’t.

There’s also a $20,000 instant asset write-off for two years and a suite of measures aimed at helping entrepreneurs set up a business.

It’s all meant to help people “have a go”, as Hockey proclaimed ahead of his budget speech to parliament.

If nothing else the budget has generated two new slogans for the coalition to peddle.

But success rests with consumers coming to the party.

It’s all very well for restaurant owners, for example, kitting out their kitchens and dining areas with the latest gear if people aren’t coming through the door to eat.

New figures this week indicated that employers aren’t necessarily lavishing cash on their staff, with annual wage growth slowing to just 2.3 per cent, the lowest in 18 years.

That’s even less than Hockey’s prediction for 2.5 per cent wage growth in 2014/15 – and the ink on the budget papers is barely dry.

Hockey points out that families are enjoying the benefit of benign inflation, record low interest rates and cheaper petrol prices.

But obviously it doesn’t do much for his income tax revenue if wages are growing at a snail’s pace.

The budget also predicts the jobless rate edging up 6.5 per cent by mid-2016, higher than the recent 12-year high of 6.3 per cent.

Yet financial markets gave the budget the thumbs up, helped by the world’s major credit rating agencies saying Hockey’s more generous second effort won’t harm Australia’s triple-A rating.

So it’s down to the polls and confidence gauges to determine whether Hockey has taken a wicket or fumbled a catch.

It will also determine whether he stays in the side.


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