If it succeeds, the rebate would start to fade out for singles on incomes of $83,000 a year and families with combined incomes of $166,000.

It would disappear altogether for singles earning $129,000 and couples earning more than $258,000.

The Federal Health Minister, Tanya Plibersek, said this would save the Federal government $2.4 billion over three years.

The government will need the votes of at least three independents, to get this bill through the House of Representatives.

If it does, passage of this measure in the Senate would be virtually assured, as the Greens, who hold the balance of power in the upper house, support it.

The support of one independent in the lower house, Rob Oakshott, is seen as critical to the government’s chances.

Mr Oakshott has not yet declared his decision.

He is expected to do so next week.

If the measure is passed, people whose incomes are above the limits set by the government, could expect to pay more for their private health insurance.

Ms Plibersek, herself, is confident.

“Well I think that this is a very important piece of legislation and I think it will pass because of the merits of the case,” she said.

Speaking in an ABC radio interview, Ms Plibersek added “We’re talking about a fairness issue here.

“ We’re talking about people in the community – some of them on say $50,000 a year who can’t afford private health insurance themselves – subsidising the private health insurance of people including very high income earners, through the tax system.”

Ms Plibersek said Labor believes that is not fair.

“So we’re seeking to reduce the subsidy given to high income earners and remove the subsidy given to the highest income earners,” she said.

The $A was fetching 107.97 US cents early today

Headlines

Doubts over Greek bail out weigh on European stock markets

The ANZ bank has signalled that it will make an announcement then.

The three other big banks will be watching closely.

Meanwhile, the Federal Treasurer, Wayne Swan, has some advice for Australians who find that they are expected to pay more.

Put bluntly, it is “walk.”

“We’ve empowered the consumer,” Mr Swan said.

“So if the bank takes a decision with which they disagree they can walk down the road and get a better deal.

“ The standard variable rate on average from the major banks at the moment is 7.3 per cent.

“You can get far better deals than that elsewhere in the financial system right now,” Mr Swan said.

Where?

He had some hints to offer about that, too.

“We’ve strengthened the credit unions,” Mr Swan said.

“We’ve strengthened the smaller banks.

“What I want to see is red hot competition out there.

“That’s what we need in this system,” the Treasurer said.

Once again, Mr Swan described Australia’s big four banks are “extremely profitable.”

“So the notion that our banks can cry poor in this environment is simply not credible,” he added.

The banks are insisting though that they must be able to cover the now higher costs of the funds they borrow overseas, to lend to Australian home buyers and small businesses.

The Reserve Bank acknowledged that Australia’s banks are, indeed,  having to meet higher costs of this kind.

It did that when it surprised markets on Tuesday by keeping its marker rate at 4.25 per cent.

One well placed source said offshore funding accounted for about 20 per cent of the funds raised for  bank lending.

He estimated that this would add at least 0.1 per cent to their costs.

The Prime Minister Julia Gillard said clean-up and recovery grants of up to $25,000 would be provided to communities in Queensland.

Similar grants, of up to $15,000, are being offered in New South Wales.

In Queensland primary producers, small businesses and not-for-profit organisations in the local government areas (LGAs) of Balonne, Barcaldine, Blackall-Tambo, Maranoa, Murweh and Paroo will be eligible.

In New South Wales, Ms Gillard the said the local government areas of  Moree, Narrabri and Gwydir would qualify.

Full details

Another small cut had been widely expected.

However, the Bank’s Governor, Glenn Stevens, said  a “moderate” economic expansion is occurring in the United States.

He said too that  “acute financial pressures” in Europe  had been “alleviated considerably” late last year.

Mr Stevens also said that the two rate cuts, that the bank announced late last year, had left the rates Australia’s borrowers pay close to their “medium term average.”

“With (domestic) growth expected to be close to trend and inflation close to target, the Board judged that the setting of monetary policy was appropriate for the moment,” the Reserve Bank Governor added.

The decision has, at least, postponed a looming stand off between the Federal government and Australia’s big four banks.

The Treasurer, Wayne Swan, had called on those banks to pass on any rate cut in full.

He said that  banks which did not do so would be acting to protect their “huge profitability.”

The banks might well have resisted that demand, if the Reserve Bank had cut its marker rate.

Bank executives, including Westpac’s chief, Gail Kelly, argue that the costs Australia’s banks now incur, raising funds for home and business loans, has risen as a result of the European debt crisis.

The risk of an all out confrontation between the Federal government and the banks eased when the Reserve Bank kept rates on hold.

Mr Stevens did admit that more needs to be done to bring Europe’s debt problems under control,

“Much remains to be done to put European sovereigns and banks on a sound footing, but some progress has been made,” he said.

Mr Stevens admitted, though, that financial market sentiment “remains skittish.”

He also said : “information on the Australian economy continues to suggest growth close to trend,

Mr Stevens admitted, though, that differences between sectors still persist.

“Labour market conditions softened during 2011 and the unemployment rate increased slightly in mid year, “ he said.

However unemployment had been steady over recent months.

Consumer price inflation “has declined as expected,” he added,

Mr Stevens said that had happened as fresh food prices eased, as the large rises resulting  from last year’s floods, passed.

“Year-ended CPI inflation will fall further over the next quarter or two,” he added.

“In underlying terms, inflation is around 2½ per cent,” Mr Stevens said.

This suggests that the Australian economy is still gathering strength, however slowly.

The Bureau reports that, in trend terms, the nation’s retail sales rose by 0.2 per cent in December, despite a fall of 0.1 per cent, on seasonally adjusted figures.

The trend movement has now been steadily upwards since 2009.

So Australians are starting to spend again, even though they are still worried by Europe’s unresolved debt problems.

There is much, though, that was distinctly unseasonal, about the December retail sales figures.

On seasonally adjusted figures, for example, we  cut our spending on Christmas cake – and other food – by 0.7 per cent that month.

We cut our spending in restaurants, cafes and take away food stores, too, by 1.8 per cent.

We spent more, though, on clothes, shoes and accessories.

Even our long suffering Department Stores managed to chalk up higher sales in December, without putting on extra staff.

Job figures, that the Bureau had released earlier, showed that many young women missed out on their usual part time and casual shop assistant jobs, last year, in the pre-Christmas period.

Oddly, too, the Bureau reported that Australia’s resource rich States, Queensland and Western Australia – led the way down  in December’s retail sales – on seasonally adjusted estimates.

The Bureau, though, prefers its trend figures, even though they contain elements of averaging, from previous periods.

Journalists, who want nothing but the latest, have been difficult to persuade, on that matter.

This time, at least, though the Bureau has a good point.

The trend, in retail sales, is clearly upwards.

If  it continues, that will soon put new strength in the economy, as Australians, once again, start flashing their credit cards in the nation’s shops.

Up to 100,000 Australian families that might be eligible are not getting this help.

That estimate comes from the Minister for Early Childhood and Child Care, Kate Ellis.

She urged people  to check their situation.

“I would urge families using child care to visit the mychild.gov.au website and access the estimator tool, in order to find out what assistance they could be missing out on,” Ms Ellis said.

The Child Care Benefit and the Child Care Rebate payments are designed to help working families meet the costs of child care and support parents who are returning to the workforce.

“Our Government is delivering record levels of investment in child care affordability and we want to make sure that all eligible Australian families are taking that assistance up,” Ms Ellis added.

She said it would set aside a record $18.1 billion, for this kind of assistance, over the next four years.

So what is available?

Ms Ellis said  that in 2008, the Federal Government had increased the Child Care Rebate from 30 to 50 per cent of parents’ out of pocket costs.

It had also increased the maximum amount per child from $4,354 to $7,500 a year.

“As a result of these changes, the percentage of family income spent on child care fell from 13 per cent in 2004 to 7.5 per cent in 2011.,” Ms Ellis said

Since July last year the Government has also given parents the option to receive Child Care Rebate payments fortnightly, to help ease cost of living pressures being faced by many families, Ms Ellis said.

Still confused?

Why not ring the Family Assistance Office on 13 61 50 to make inquiries?

Despite an improvement in the latest Herald Neilsen poll, published in The Sydney Morning Herald  today, Labor still trails the Coalition 47 -53.

Ms Gillard also saw a 6 point rise in her approval as Prime Minister.

Even on these figures, though,  Labor would still be soundly defeated in a general election.

Even so, that was still an 8 point improvement for Labor.

Meanwhile, the Opposition Leader Tony Abbott has also virtually ruled out an attempt to bring down the Gillard government, by mounting a no confidence motion, when parliament resumes this week.

Instead, the Prime Minister told reporters she was looking forward to a planning session with Labor MPs, when she arrived for a Caucus meeting yesterday.

The meeting decided to attack the opposition on the economy, with MPs saying Mr Abbott had failed to set out an alternative plan for Australia’s economic management, when he addressed the National Press Club last week.

Ms Gillard told the meeting that Labor needed to present its message more clearly.

She also called for discipline, warning MPs to stop backgrounding reporters.

Meanwhile the Treasurer, Wayne Swan, who strongly supports Ms Gillard, reminded the public of Labor’s achievements, since it took office.

Mr Swan said families with a typical $300,000 home loan,  are now saving $3,000 a year on repayments, through lower interest rates.

He also said the Reserve Bank’s marker cash rate, which had been 6.75 per cent, when Labor came to power, is now 4.25 per cent.

Mr Swan also described Australia’s big four banks as “hugely profitable.”

He said they would be well able to pass on any rate cut the Reserve Bank might announce on Tuesday, in full. (see separate story)

Mr Swan claimed, too, that the government’s record of job creation is “outstanding” with 700,000 Australians gaining jobs over the past four years.

Tony Abbott, though, insisted that Australians still  needs a “better government right now.”

“I think we need an election,” Mr Abbott said.

However, Mr Abbott  said that while ever Craig Thompson is in Parliament “I think this government is firewalled against a no confidence motion…”

In a television interview, Mr Abbott also accused Fair Work Australia “or elements of it” of collusion with the government, in the Craig Thompson case.

Fair Work Australia has been investigating allegations that Mr Thomson, now a Labor MP,  misused union credit cards.

However FWA has not yet produced a report on the case, despite long proceedings.

Mr Rudd, the Foreign Minister, who is overseas on duty, did not attend the Caucus meeting, which was followed by a barbeque Ms Gillard held for Labor MPs, at the Lodge.

Although she is likely to survive as Prime Minister, at least in the short term, Ms Gillard’s position remains weak.

Both public and private polling has shown, consistently, that she does not have the public support she would need, to win the Federal election due next year.

That polling also shows that Kevin Rudd, the man she deposed from the nation’s top job, would have a much better chance of victory in that election.

Ms Gillard dismisses talk of a Rudd challenge as media “chatter.”

But Labor party bosses are not completely convinced.

And the chance of even a highly embarrassing victory next year, with a recycled Rudd leading the campaign still tempts them.

The Treasurer was speaking, in a television interview,  just days before the Reserve Bank board meets to review Australia’s interest rates.

A third rate cut, also of 25 basis points, is widely expected.

However, bank executives, including Westpac’s chief Gail Kelly, have been signalling that they might not pass on the full amount of any rate cut, that the Reserve Bank might announce on Tuesday.

Mr Swan’s pre-emptive response was swift and sharp.

“Customers would have every right to be angered if their bank decided to hang on to part of a rate cut to boost their profits,” he said.

“There’s no doubt Australia’s major banks are hugely profitable,” the Treasurer added.

“Despite the current global volatility, their net interest margins are still around pre-crisis levels and are around their average over the past decade.

“Their return on equity is much higher than most of their global peers,” Mr Swan said.

That is not what the banks have been saying.

Ms  Kelly, for example, has said that the funding costs Australia’s banks face rose quite strongly in the second half of last year.

Westpac, itself, admitted last week that it is planning to cut 300 to 400 jobs and union sources have said that as many as 560 jobs could well disappear at that bank.

The ANZ bank, too, has already cut more than 100 jobs and more jobs are expected to go at the ANZ over coming months.

Other banks are also understood to be reviewing their staff levels, in the light of recent developments.

Mr Swan described recent announcements of job cuts,  most notably in the banking and car industries, as “disappointing.”

Speaking principally of the car industry, he said: “There’s no doubt that many sectors are doing it tough at the moment, particularly with the high Australian dollar.”