Kevin Rudd’s cash splash financial stimulus continues to show its flaws

The dust has long settled with the newest Australian budget, and while the pain of some of the changed laws are still to be felt, again the question must be asked - was handing out bundles of money to individuals worth it?

Naturally, there are people – a lot of people – that would say it was worth every cent. Numerous families, especially those with many children, as well as some other denominators, received multiple amounts.

At the end of last year close to $10 billion was handed out, and this time round over $8 billion has been given.

Of course, the injection of financial stimulus into stalled economies is crucial to most nations’ recoveries.

For the basic principle of any economic engine is money or credit being moved around through the system.

Or, essentially, people spending money.

But this stimulus and cash handout has not only been poorly conceived, but now evidence is being revealed that the system is being rorted.

First of all, as nearly a million Australians have found out, the criteria for determining who received this money is a bit misleading.

It is not based on whether you earned up to $80,000.

You actually had to have paid tax.

So if you were a low income earner, say on anything from $13,000 and lower, you don’t receive a cent of the stimulus.

This is damningly ironic, as in Parliament today; the Rudd government launched a scathing attack on the oppositions (Liberals) traditional mindset of only looking after the rich.

Despite having this recent fuel for retaliation, it was something that the Lib’s didn’t pick up on.

But, terrible loopholes are now emerging in regard to the payments themselves.

16,000 dead Australian citizens have received payments, some reports state that this in excess of $10 million dollars.

27,000 Expats have received this money as well. So if you have recently moved away from Australia, and filled in a 2007/08 tax return (the basic criteria) check your mailbox and bank account.

You could be up to $900 richer.

Bankers working in America and the Middle East who are Australian citizens are receiving these cheques if they have assets back home, and are paying tax on their property or assets.

Also thousands of backpackers from overseas have received the payments.

But it is the rich who have benefited the most.

Accountants have revealed all throughout Australia than some people have claimed up to six of the $900 bonus payments; all done quite legally, due to the various ways that high income earners can split their “earnings”.

One Melbourne accountant revealed that a client that earned $360,000 received six payments, while another client who earned $13,000 as a carer received nothing.

Other people have reported receiving extra payments for no reason.

And what happens when they contact the Tax office to inform of the error?

A blessing to go and spend the “misdelivered money”; it is almost as if they know the system was poorly conceived.

Treasurer Wayne Swan has tried to defend the stimulus payments. "The stimulus measures have gone overwhelmingly to low and middle-income families, singles and pensioners, and were delivered as quickly as possible on the ATO's advice," Mr Swan said.

The prime minister has stated that these payments, as well as creating jobs, were absolutely necessary in the face of a crisis.

Even though Australia has suffered the least of any first world countries.

"I recognise that a temporary deficit may not be popular," Mr Rudd said.

"But that is the global reality we face with virtually all Governments now in deficit. I cannot remove the impact of the global recession on Australian jobs.

"But by Government action we can reduce it."