Move on migrants to save $1.3b

NEW migrants will now face a three-year wait before becoming eligible for a range of welfare payments under a bid to shave $1.3 billion from the Federal Budget.

A push to “encourage selfsufficiency” among new Australians will lead to an additional year for qualification before they can receive Newstart or family tax benefits, paid parental leave or carer allowances.

The new measures — along with more than $2 billion in changes to the university system — enabled Treasurer Scott Morrison to outline drastic improvement in the government’s book since May, with the bottom line more than $9 billion better off than forecast earlier this year.

The Turnbull Government’s mid-year economic update is now predicting it can reach a $10.2 billion surplus in 2020-21, which would be enough to cover an incometax cut for low-and-middle salary earners.

Mr Morrison said the Government was “turning the debt ship around”, and reduced the growth of debt by more than two-thirds since 2013.

“We have ensured that the debt that we expect at the end of the forward estimates to be $23 billion less, $40 billion over the next 10 years,” he said.

“That means lesser interest payments, which means we can continue to make progress on balancing the Budget in line with what we said at the last election, and you put this all down to the jobs and growth plan of the government.”

The $9.3 billion improvement over the four years to 2020-21, is helped by $6.5 billion in lower-than-expected spending.

This financial year, wage growth was downgraded from 2.5 per cent to 2.25 per cent and, next year, from 3 per cent to 2.75 per cent.

The jobless rate is expected to fall from 5.5 per cent this year to 5.25 per cent next year.