CANBERRA (Reuters) - Key policies of Australia's new conservative Prime Minister Tony Abbott, who swept into office in Saturday's national elections, ending six years of center-left Labor party rule.
The election is unlikely to have any major foreign policy implications. The new Liberal-National Party coalition government is a strong supporter of a long-standing military alliance with the United States, and supports the rotation of U.S. Marines through northern Australia. It also strongly supports closer ties with China, which is Australia's top trading partner, and wants to push ahead with negotiations for a free trade deal with China.
Incoming Prime Minister Tony Abbott, however, promised to cut A$4.5 billion ($4.1 billion) from Australia's foreign aid program over four years.
Australia's A$1.5 trillion economy is in transition as the investment phase of a big mining boom comes to an end. The economy has marked up 22 years of continuous growth, with gross domestic product (GDP) rising 2.6 percent in the year to the end of June. Unemployment is 5.7 percent, and interest rates are at a record low 2.5 percent. Both the central bank and the government would like to see a lower Australian dollar, to help ailing manufacturers and exports.
Abbott has promised stronger control on government finances to guard Australia's AAA credit rating. He said his government would ensure a budget surplus of around 1 percent of GDP within a decade and plans to cut 12,000 public service jobs to help control spending.
He has also promised to cut company tax by 1.5 percentage points to 28.5 percent from July 1, 2015, at a cost of A$5 billion in its first two years. But the biggest 3,000 companies will be hit with a 1.5 percent levy, to help fund a paid parental leave scheme.
The latest budget update forecasts the budget will have a small surplus by 2016, with net debt forecast to peak at A$191.6 billion, or 11.4 percent of GDP, in 2014-15 - still less than one eighth of the debt levels of major advanced economies.
Abbott has promised to scrap a controversial 30 percent profits tax imposed on major coal and iron ore mines.
Former prime minister Julia Gillard introduced the tax, which began in July 2012, after negotiations with global miners Rio Tinto, BHP Billiton and Xstrata, now Glencore Xstrata.
However, the tax take has fallen short of forecast and is expected to raise only about A$3.0 billion in its first four years, down from initial estimates of A$13.4 billion.
CARBON PRICE, ENERGY
Abbott has promised to abolish an unpopular carbon tax, currently set at A$24.15 a metric ton (1.1023 tons) and imposed on Australia's top 300 polluters.
Abbott has also committed to cut Australia's carbon emissions by 5 percent of year 2000 levels by 2020, through a direct action policy.
The former Labor government had set a 20 percent renewable energy target, set at 41,000 gigawatts, by 2020. But falling electricity demand might see Abbott' government review the target to 20 percent of real demand by 2020, which would see the target drop to about 27,000 gigawatt hours.
The steady flow of refugee boats from Indonesia is a hot political issue, particularly in a clutch of marginal seats. About 400 boats have arrived in the past 12 months, and 45,000 asylum seekers have arrived since Labor won office in late 2007.
Abbott has promised to stop the boats, and to use the navy to turn back boats to Indonesian waters. However, there are few details on how that will be done.
He also wants to expand the number of asylum seekers who can be processed outside of Australia on the remote Pacific island nation of Nauru.
Abbott's landmark election policy is a promise to give women up to six months leave, on full pay, upon the birth of a baby. The scheme would start on July 1, 2015, and is caped at A$75,000. It will be partly funded by a 1.5 percent levy on companies with income above A$5 million.
Business thinks the scheme is too generous. And the Greens, who may hold the balance of power in the upper house Senate, will move to lower the maximum payment to A$50,000.
Abbott has promised to suspend work on a A$38 billion national high-speed broadband network, delivered to households via fiber-optic cables with broadband speeds of 100 megabits per second. The new government wants to complete the broadband network at a lower cost, of about A$29.5 billion, but with slower speeds of 25 megabits per second. It will use fiber optic cables to suburban hubs, but then rely on existing copper wires to deliver the network the final meters to each house.
(Reporting by James Grubel; Editing by Michael Perry)