Sarah Gall is a political data scientist and membership secretary for the UK’s Conservative Friends of Australia. She previously headed up political and policy research for the Prime Minister of Australia.
Last week, the Australian Treasurer (the equivalent of the Chancellor of the Exchequer) handed down Labor’s first Federal Budget since coming into office.
To say it went down like a lead balloon would be an understatement. Almost half of voters believe that they will be worse off in the next year, just over half believe the budget didn’t do enough to address cost-of-living pressures, and only three in ten believe it will be good for the economy – the lowest level for any budget on record.
So where did the newly elected Labor government go so horribly wrong?
To use Anthony Albanese’s own attack line while he was opposition leader, “everything is going up except wages”. Cost-of-living, energy bills, interest rates, unemployment, taxes, and the debt and deficit. Labor’s first budget was an outline of problems with no solutions.
This is despite the Prime Minister telling voters during the election campaign that Labor was the party that had a plan to ease cost-of-living pressures, create jobs, and to get real wages growing again.
It was also the party that promised to cut power bills for Australians by $275 per year; a now-broken promise that the Opposition has seized on, reminding voters of the 97 occasions when Albanese promised to cut their power bills.
Voters were deceived and they should be angry. According to the Government’s own forecasts, electricity bills will increase by more than 56 per cent over the next two years – up to 80 per cent in some parts of the country – and gas prices are set to go up by 44 per cent. Moreover, it predicts inflation to increase, which will continue to constrict household budgets.
While the Government is not responsible for the rising level of inflation, they are responsible for the response.
In this budget, Labor has reshuffled the deck by repurposing the previous government’s spending commitments to fund its own election promises. This means it is good news for parents with children who will benefit from generous subsidies, but bad news for everyone else who was hoping to receive some relief.
The greatest issue however, lies in the fact that around half of Labor’s spending will be on aged care, health, disability support, and of course the interest on public debt. While these are worthy causes, the medium-term projections show that Labor’s economic management – or lackthereof – will ensure there is no pathway back to surplus and no responsible approach to reducing the debt.
This was despite the Government inheriting a better-than-expected budget outcome from the Coalition, providing an additional $54.4 billion in tax receipts largely driven by higher-than-expected commodity prices and strong employment growth.
With an aging population, a forecast that the commodity price boom is only temporary, and that unemployment will begin to rise, Labor finds itself with a structural budget deficit. This is of course unless they cut spending elsewhere or increase taxes.
Neither of these are good electoral options given the already poor reception of this budget which has been seen as the second worst budget since Tony Abbott’s austerity budget in 2014-15 following the Coalition returning to office in 2013.
Fortunately for Labor, they are still well ahead in the polls, as voters have yet to warm to the Opposition. This may begin to shift however, as the opposition leader, Peter Dutton, has used his budget-in-reply speech to re-establish conservative values and demonstrate that the Coalition is the party to ensure a strong recovery.
What Labor has shown is that it has not changed since its reckless spending days when it was last in office between 2007 and 2013. The Government is continuing the general trend which sees Labor use its time in government as a spending wrecking-ball with no fiscal responsibility, racking up public debt.
This then leaves the Coalition to use their time in government making unpopular, and tough choices to get the budget back on track to repay Labor’s debt.
This budget is confirmatory of Labor’s first 100 days in office, in that it continues to do nothing to address cost-of-living pressures and only focus on the superficial. It is proof that it is the same old Labor who can’t manage money and do indeed have a spending problem.
The issue with that is that the electoral cycle is enough time for Labor to do considerable damage to the economy, leaving Australians worse off.
Sarah Gall is a political data scientist and membership secretary for the UK’s Conservative Friends of Australia. She previously headed up political and policy research for the Prime Minister of Australia.
Last week, the Australian Treasurer (the equivalent of the Chancellor of the Exchequer) handed down Labor’s first Federal Budget since coming into office.
To say it went down like a lead balloon would be an understatement. Almost half of voters believe that they will be worse off in the next year, just over half believe the budget didn’t do enough to address cost-of-living pressures, and only three in ten believe it will be good for the economy – the lowest level for any budget on record.
So where did the newly elected Labor government go so horribly wrong?
To use Anthony Albanese’s own attack line while he was opposition leader, “everything is going up except wages”. Cost-of-living, energy bills, interest rates, unemployment, taxes, and the debt and deficit. Labor’s first budget was an outline of problems with no solutions.
This is despite the Prime Minister telling voters during the election campaign that Labor was the party that had a plan to ease cost-of-living pressures, create jobs, and to get real wages growing again.
It was also the party that promised to cut power bills for Australians by $275 per year; a now-broken promise that the Opposition has seized on, reminding voters of the 97 occasions when Albanese promised to cut their power bills.
Voters were deceived and they should be angry. According to the Government’s own forecasts, electricity bills will increase by more than 56 per cent over the next two years – up to 80 per cent in some parts of the country – and gas prices are set to go up by 44 per cent. Moreover, it predicts inflation to increase, which will continue to constrict household budgets.
While the Government is not responsible for the rising level of inflation, they are responsible for the response.
In this budget, Labor has reshuffled the deck by repurposing the previous government’s spending commitments to fund its own election promises. This means it is good news for parents with children who will benefit from generous subsidies, but bad news for everyone else who was hoping to receive some relief.
The greatest issue however, lies in the fact that around half of Labor’s spending will be on aged care, health, disability support, and of course the interest on public debt. While these are worthy causes, the medium-term projections show that Labor’s economic management – or lackthereof – will ensure there is no pathway back to surplus and no responsible approach to reducing the debt.
This was despite the Government inheriting a better-than-expected budget outcome from the Coalition, providing an additional $54.4 billion in tax receipts largely driven by higher-than-expected commodity prices and strong employment growth.
With an aging population, a forecast that the commodity price boom is only temporary, and that unemployment will begin to rise, Labor finds itself with a structural budget deficit. This is of course unless they cut spending elsewhere or increase taxes.
Neither of these are good electoral options given the already poor reception of this budget which has been seen as the second worst budget since Tony Abbott’s austerity budget in 2014-15 following the Coalition returning to office in 2013.
Fortunately for Labor, they are still well ahead in the polls, as voters have yet to warm to the Opposition. This may begin to shift however, as the opposition leader, Peter Dutton, has used his budget-in-reply speech to re-establish conservative values and demonstrate that the Coalition is the party to ensure a strong recovery.
What Labor has shown is that it has not changed since its reckless spending days when it was last in office between 2007 and 2013. The Government is continuing the general trend which sees Labor use its time in government as a spending wrecking-ball with no fiscal responsibility, racking up public debt.
This then leaves the Coalition to use their time in government making unpopular, and tough choices to get the budget back on track to repay Labor’s debt.
This budget is confirmatory of Labor’s first 100 days in office, in that it continues to do nothing to address cost-of-living pressures and only focus on the superficial. It is proof that it is the same old Labor who can’t manage money and do indeed have a spending problem.
The issue with that is that the electoral cycle is enough time for Labor to do considerable damage to the economy, leaving Australians worse off.