Kevin Rudd's comments that we should increase savings may be the first indication that the government is rethinking the tax give-aways planned for this year's budget.

With inflation on the rise and the Reserve Bank poised to increase interest rates, now is not the right time to provide a tax break.

Given that the planned tax cuts are a result of the previous government trying to buy its way back into office, and the mood of the electorate was for the revenues to be used to restore services that were neglected by Howard and Co, I think the government would be forgiven if they reneged on at least a portion of the cuts.

Alternatively, they could cut the tax rates while simultaneously increasing the percentage of compulsory superannuation contributions.

Rudd is keeping faith with the voters by staying true to his election promises, no matter how outlandish. That faith will be tested if the promised cuts are provided only to be removed by the Reserve Bank.