How the federal election could impact your personal finances
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How the federal election could impact your personal finances

Federal election time

The people in charge and their policies can have a significant impact on the state of your finances. With a federal election looming, we asked writer Nigel Bowen, to examine both Labor and the Coalition’s economic policies.

Your bank account doesn’t get a vote come September 7. But if it did, would it be putting a tick in the box next to Abbott or Rudd? Here are some things for those voters with a sensitive hip pocket to consider.

Labor economic policy

1. Employment: The Coalition is looking to cut 12,000 public service jobs by natural attrition and it’s widely believed that more would end up going if Tony Abbott became PM. The Liberals are also unenthusiastic about lavish subsidies for the local car industry and high penalty rates, which might be something to consider if you’re an auto worker or employed in the retail or hospitality industries.

2. Education:  Labor has committed to pumping $15 billion into the school system over the next six years and maintaining the Schoolkids Bonus, which can amount to $820 a year per high school student. (The Coalition will end the Schoolkids Bonus but has agreed to honour any education funding deals Labor has struck with individual states.)

3. Economic management: Labor, which ‘believes’ it never got the credit it deserves for steering Australia through the GFC unscathed, will continue with its steady-as-she-goes approach. That means things aren’t likely to change radically for better or worse if Labor gets a third term.

Coalition economic policy

The Coalition has traditionally been seen as the party of business, though it’s attracted a lot of blue-collar support over the past 20 years.

1. Paid parental leave: Tony Abbott has confounded his critics and enraged many traditional conservatives by introducing one of the world’s most generous parental leave schemes. If you’re of childbearing age, you can look forward to receiving your full salary (if you earn $150,000 or less) for six months post-baby if Abbott is victorious.

2. Lower taxes: The Coalition is determined to get rid of Mineral Rent Resource Tax (MRRT) and the carbon tax. Ditching the MRRT, which hasn’t raised much revenue, isn’t likely to have much impact, but abandoning carbon pricing is likely to save the average citizen hundreds of dollars a year.

3. Economic management: With the Coalition simultaneously promising to lower taxes, ramp up spending in areas such as paid parental leave and get the budget back into surplus as soon as possible, Tony Abbott will be faced with some tough choices if elected.

Australia is in the fortunate position of having an economy in relatively good shape.  Luckily, that’s unlikely to change much regardless of which side of politics is occupying the treasury benches come September 8.

What are your thoughts on the upcoming election, are there any policies that really concern you?

The views expressed in this article are those of the author and are not necessarily those of the Rabobank Group.

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