So, what’s in the Federal budget?

You will get a tax cut tomorrow night’s Federal budget – but it will be small.

Indeed, the Federal Treasurer,Wayne Swan, who made the promise, said the cut would be “modest,” for Australians on average weekly earnings.

These cuts have been scheduled for some time.  The first tranche was paid in the Rudd government’s first budget and the second last year.

Mr Swan recalled all this, in a pre-budget television interview yesterday.

“…of course, as you know, we  are delivering the third tranche of our tax cuts,” the Treasurer said.

Mr SWan also said, though, that the most important thing Australians would see, in this year’s budget, would be the funding of overdue improvements to Australia’s health system.

“This is a very significant reform in the budget,” he said.

Tomorrow night’s budget, though, will definitely not be a traditional, big-spending election year budget.

Mr Swan is adamant about that.

The big spending, that came with the Federal government’s stimulus measures, in the wake of the global economic crisis, have now largely passed.

However Mr Swan  said that they had, definitely, been worthwhile.

“We were terribly exposed and what we did do was act decisively to put in place the most effective fiscal stimulus among advanced countries.” Mr Swan said.

There will be some late surprises in the budget, though.

One will be a new scheme, negotiated with Australian airlines, which will save the Federal government $160 million over four years, by wiping out frequent flyer points for MPs and their staff.

A 2 per cent cap will also be placed on rises in Federal spending, in this year’s budget.

Australia’s new mining boom will also be reflected in this year’s budget.

Mr Swan admitted that this would allow the government to return to budget surpluses earlier than had been previously expected, after the crisis.

However we certainly won’t see a budget surplus tomorrow night.

Mr Swan  also said yesterday he would spend the rest of his weekend putting “the finishing touches” to what he  called “a no frills budget.”

“Our public finances are among the strongest in the world,” Mr Swan said.

Indeed, the Reserve Bank Governor, Glenn Stevens, had described them as being in “terrific shape,” the Treasurer added.

Some may regard the list of features, that Mr Swan spelt out, as impressive.

These were:-
-Very strict spending limits
-The biggest health reforms since the introduction of Medicare
-A big boost for superannuation Tax cuts for small business and
-More infrastructure investment.

However, with the Rudd government slipping badly, in recent opinion polls – and an election due later this year – there can be little doubt that Mr Swan would be feeling much more comfortable tomorrow night, if he could throw in one or two solid vote grabbing announcements.

The Treasurer says he won’t be doing that.

His brave statements, though, must hurt.