Policy Assembly Federal Report The Hon Peter Costello MP Treasurer 13th June 2003

Defence spending Underlying funding $billion Budget (excluding Iraq) International operations (including East Timor, Afghanistan & Iraq) Enhanced ADF capabilities White Paper $billion

Higher education spending Baseline funding Additional funding Estimates $billion

Health spending Other Australian Health Care Agreements Pharmaceutical Benefits Scheme Medicare Benefits Schedule $billion

Ability to redirect spending Assistance to Families & Children Hospitals & Schools Assistance to Families & Children Public Debt Interest Hospitals & Schools Public Debt Interest $billion

International budget comparisons Japan United States OECD European Union Australia Per cent of GDP

Commonwealth net debt ProjectionsEstimates Outcomes Per cent of GDP

International net debt comparisons GermanyTotal OECDEuropean Union JapanUnited States Australia Decade from 1995 to 2004 Per cent of GDP

Personal tax cuts ,00020,00030,00040,00050,00060,00070,000 Taxpayer's annual income ($) Tax savings - $ per year (RHS) Tax cut per year (%)Tax cut per year ($) Tax savings - percentage reduction (LHS) Large percentage reduction for taxpayers with incomes between $20,000 and $27,475

Queensland, WA, Tasmania, ACT and NT are now better off than they would have been had tax reform not been implemented by the Government in 2000 $32 billion GST to the States