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Chart 3.1: Government spending

The proportion of Commonwealth and State spending on various items is shown.

The six major Commonwealth spending items are Social Security and Welfare (33 per cent), Health (16 per cent), Education (8 per cent), Defence (6 per cent), Public Services (5 per cent), and Other Purposes, including GST (19 per cent), with remaining spending being 12 per cent.

The six major State spending items are Health (26 per cent), Education (24 per cent), Public Order and Safety (10 per cent), Transport and Communications (10 per cent), Social Security and Welfare (8 per cent), and Housing (5 per cent), with remaining being 16 per cent.

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Chart 3.2: Spending on selected functions of government

Twelve charts show how much the Commonwealth, the States, and the States spending Commonwealth funded money on various items.

The Commonwealth is the primary spender on Defence, Higher Education, Health excluding Hospitals, Social Security, and Environmental Protection.

The States are the primary spenders on Public Order & Safety, Primary & Secondary Education, Hospitals, Housing, and Transport & Communication.

Spending in evenly split on Welfare Services and Recreation & Culture.

The Commonwealth makes significant contributions to States’ spending on Primary & Secondary Education, Higher Education, Hospitals, Welfare Services, Housing, and Transport & Communication.

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Chart 3.3: Vertical fiscal imbalance in Australia

Panel A: Commonwealth major own source revenues and expenses

The major expenses and revenues of the Commonwealth are shown.

The largest expenses are Social Security ($127 billion), Health ($62 billion), Other ($52 billion), Education ($29 billion), Defence ($21 billion), and General Public Services ($20 billion).

The largest revenues are Personal Income Tax ($150 billion), Company Income Tax ($68 billion), Goods and Services Tax ($49 billion), Excises and Levies ($26 billion), and Superannuation Taxation ($8 billion).

Panel B: States major own source revenues and expenses

This chart shows the States main sources of revenue (property taxes, payroll taxes, etc) and, on the same scale, the main expenses (health, education, transport, etc). Expenses are significantly higher than the revenue.

Panel C: Total revenues and expenses

This chart shows the imbalance in the revenue raising capacities and spending responsibilities of the Commonwealth and the States, the Commonwealth raises revenues in excess of its spending responsibilities, while State governments have insufficient revenue from their own sources for their spending responsibilities.

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Chart 9.5.1: FTB-A income test for a family with two children under 13 years

This chart shows the current rates and income test for Family Tax Benefit A for a family with two children under 13. Families receive the maximum rate of $10,607 up to an income of $48,837 above which the payment is reduced by 20 cents for each additional dollar of income. At an income of $79,862 payment reaches the base rate of $4,402 and remains at this rate for incomes up to $98,112. Payment is reduced by 30 cents in the dollar for incomes greater than this, and cuts out at an income of $112,785.

Return to Chart 9.5.1

Chart 9.5.2: FTB-B secondary earner income test for family with youngest child under five years

This chart shows the current rates and secondary earner income test for Family Tax Benefit Part B for a family whose youngest child is under five. Families receive the maximum rate of $4,242 if the secondary earner's income is below $5,183. Payment is withdrawn by 20 cents for each additional dollar of income until it reaches nil at an income of $26,390.

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Chart 9.5.3: Distribution of income for all families with children, 2012-13, and current and proposed means tests for FTB-A for a family with two children under 13

This chart overlays the current and proposed Family Tax Benefit A income tests for a family with two children aged under 13 with the distribution of income for all families with children. The median income for all families is $96,500. Under the current means test payment is phased out at $112,785 and under the proposed means test it would be phased out at $99,220.

Return to Chart 9.5.2

Chart 9.5.4: Impacts of the proposed package on selected example family types

This chart compares the total amounts of Family Tax Benefit received under the current and proposed arrangements for 15 example family types. A sole parent with two children aged four and six and income of $50,000 receives $14,616 currently and would receive $14,085 under the proposed system. A sole parent with two children aged nine and 11 and income of $50,000 receives $13,444 currently and would receive $9,844 under the proposed system. A sole parent with two children aged nine and 11 and income of $80,000 receives $7,472 currently and would receive $3,844 under the proposed system. A couple with two children aged four and six where one partner earns $50,000 receives $14,616 currently and would receive $9,844 under the proposed system. A couple with two children aged four and six where one partner earns $80,000 receives $8,643 currently and would receive $3,844 under the proposed system. A couple with two children aged four and six where one partner earns $100,000 receives $8,077 currently and would receive no assistance under the proposed system. A couple with two children aged four and six with income of $80,000 split 50:50 between two earners receives $4,402 currently and would receive $3,844 under the proposed system. A couple with two children aged four and six with income of $100,000 split 50:50 between two earners receives $3,836 currently and would receive no assistance under the proposed system. A couple with two children aged four and six with income of $50,000 split 75:25 between two earners receives $13,152 currently and would receive $9,844 under the proposed system. A couple with two children aged four and six with income of $80,000 split 75:25 between two earners receives $5,680 currently and would receive $3,844 under the proposed system. A sole parent or couple with three children aged nine, 11 and 13 where one earner earns $80,000 receives $14,437 currently and would receive $9,993 under the proposed system. A sole parent with one child aged four and income of $50,000 receives $9,312 currently and would continue to receive the same amount under the proposed system. A couple with one child aged four where one partner earns $50,000 receives $9,312 currently and would receive $5,071 under the proposed system. A couple with one child aged four with income of $50,000 split 50:50 between two earners receives $5,349 currently and would receive $5,071 under the proposed system. A couple with one child aged four where one partner earns $80,000 receives $6,442 currently and would receive no assistance under the proposed system.

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Chart 9.7.5: Projected combined government expenditure on schooling

This chart shows Commonwealth and State funding for government schools. As outlined in the text, the Better Schools Plan would see the Commonwealth's share of government schools funding increase from less than 17 per cent in 2014-15 to around 25 per cent by 2022-23 of public funding.

This chart shows Commonwealth and State funding for non-government schools. Under the Better Schools Plan, the Commonwealth's share of funding for non-government schools would remain relatively constant at around 75 per cent of public funding.

Return to Chart 9.7.5