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 Federal Health Minister Tanya Plibersek , who made this claim, described these ads as “the last bastion of tobacco advertising” in Australia.

She said the Australian Senate has now passed legislation restricting online tobacco advertising in this country.

“This legislation has extinguished the last remaining opportunity for tobacco companies to freely promote their harmful products to the Australian public,”  Ms Plibersek said.

“Sales of tobacco on the internet will be subject to the same restrictions as everywhere else, and online retailers won’t be able to spruik cigarettes with words such as ‘cheap’ and ‘tax-free,’” she added

Ms Plibersek said the new law will bring restrictions on tobacco advertising on the internet into line with those applying to other media.

She said the new law complements the Australian Government’s world-first plain packaging legislation, which removes tobacco companies’ ability to advertise on tobacco packaging.

Smoking related illnesses kill an estimated 15,000 Australians each year.

They cost the community more than $A 30 billion ($US27.8 billion).

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.

The Bureau of Statistics reports that retail sales fell more in Queensland and Western Australia in December, than in other parts of the nation.

On seasonally adjusted figures, the Bureau reports that Australia’s retail sales fell by 0.1 per cent in December, after a rise of the same size the previous month.

Queensland and Western Australia led the way down, with falls of 1.4 and 0.7 per cent, respectively.

Sales in the Northern Territory also dropped sharply, falling by 2.6 per cent.

The Bureau reports that pre-Christmas sales also fell in New South Wales, South Australia and Tasmania.

However pre-Christmas sales rose by 1.5 per cent in Victoria and 1.8 per cent in the ACT.

Food sales fell by 0.7 per cent in December, while sales in cafes, restaurants and take away food stores dropped by 1.8 per cent.

However, we spent more on clothes, shoes and personal accessories in December.

Department stores also chalked up a 1.1 per cent rise in their sales that month, while sales of household goods rose 0.2 per cent.

For other retailers, though, sales were mostly flat.