Action needed now to boost budget: Grattan Households, people heading towards retirement and superannuants could be affected if the federal government accepts a proposal to boost the budget by billions a year. As the coalition awaits the findings of its whole-of-government commission of audit to cut expenditure, the Grattan Institute warns tough action must be taken now if Australia is to avoid massive deficits in the future. Rising health and welfare costs and big-ticket spending could collectively lead to deficits of $60 billion within a decade, it says. The Grattan Institute says the federal government will need to make a start on the fiscal bill facing the nation when it hands down its first budget in May. "You have to do something pretty material in your first budget, otherwise people will not take you seriously," institute chief executive John Daley told AAP. The institute has constructed a package that would boost the budget by more than $30 billion a year. It includes broadening the base of the 10 per cent GST by removing exemptions on fresh food, health and education, to bring in about $13 billion a year. The institute also supports the Productivity Commission's call last week for the pension age to be increased to 70. The current transition from 65 to 67 years in 2023 is "way too slow and not enough," Mr Daley said. He recommends the pension age rise by six months each year to 70 years by 2025. Delaying access to the aged pension and superannuation would bring in $12 billion a year, through increased income tax and reduced pension outlays. Another recommendation is that the superannuation concessional contributions threshold on accounts should be cut to $10,000. Superannuation was originally designed so a younger generation could pay for its own retirement, Mr Daley argues. "Instead, it has become a mechanism that means older people pay less tax given their income than everybody else," he said. The Grattan Institute also recommends changes to the age pension asset test by ending the owner-occupier housing exemption to save $7 billion. Asset-rich households could still claim a part pension, but this would accumulate as debt against the house, which would be collected when the house was sold. "All it is doing is saying to households that are very well off, `you don't get to collect the pension just because you have put all your assets into a house'," Mr Daley said. Mr Daley says he is acutely aware the proposals, outlined in the Grattan Institute's latest report released on Sunday, are sensitive.