Rudd threatens early election as Opposition lashes budget spending on SMEs

Prime Minister Kevin Rudd has threatened calling an early election if the Opposition, Greens and independent senators decide to pick apart the federal budget.

While Rudd says he has a conservative view on early elections, and believes Governments should serve out their full term, he claims that Labor as “got to ensure that the financial integrity of the budget that we just put before the Parliament … is upheld”.

“When people start cherry-picking about one bit after another, you’ve got to be very, very careful that we don’t put the financial integrity of the budget, long term, at risk.’

“My intention … is to serve the term for which we were elected, but we also have responsibilities and we’ll continue to prosecute those.”

The Opposition has slammed the Government over the $58 billion deficit in 2009-10 and its forecast that the budget will not be back in surplus until 2015.

Shadow Treasurer Joe Hockey has also described the Government’s growth forecast – which see growth rebounding from -0.25% in 2009-10 to 2.25% in 2010-11 and 4.25% the year after – as ridiculously optimistic.

Opposition small business spokesperson Steven Ciobo has also lashed the Government’s measures to help SMEs, including the increased tax break for investment, and says more should have been done to help businesses with cashflow problems.

“The fact is that the small business tax break is a mirage,” he says. Ciobo points to MYOB’s latest Australian Small Business Survey, which showed only 30% of small business owners expect to make capital investments in their business over the next six months.

“Labor does not understand small businesses must have a dollar to be able to invest a dollar. That’s why it was important for Labor to assist small business cashflow.”

Ciobo says the Government should have considered the Coalition’s six-point action plan, released earlier this year. It included measures such as allowing SMEs to carry-back tax losses incurred this year against tax paid in previous years and subsidies to help SMEs pay superannuation.  

More budget 2009 coverage:

• Budget 2009: Small business tax break boosted from 30% to 50%
• Budget 2009: Exporters get extra funding
• Budget 2009: Do Not Call register expanded
• Budget 2009: $22 billion for infrastructure in budget
• Budget 2009: First home owner grant extended for three months
• Budget 2009: High and middle-income earners hit by changes to private health insurance, super
• Budget 2009: Innovation spending boost, but new R&D tax breaks delayed
• Budget 2009: Key budget measures at a glance
• Budget 2009: Holiday shack attack
• Budget 2009: Funds for textile, clothing and footwear sector